Airbnb (ABNB 0.26%) reported first-quarter results after the markets closed on Tuesday, May 3. The worldwide travel facilitator is experiencing a surge in revenue as consumers unleash pent-up demand for travel. 

Thankfully, the world is progressing in its battle against COVID-19, making folks more comfortable with traveling again. After people were cooped up at home for so long, the boom could last beyond this year. Let's look closer at Airbnb's results for details. 

Two kids with luggage walking towards a home.

Image source: Getty Images.

Revenue is exploding from a year ago -- and longer

In the first quarter, which ended on March 31, Airbnb's revenue exploded by 70% from the same time last year. Interestingly, it was also 80% higher than in the same quarter before the outbreak. So, after experiencing a decrease in revenue at the pandemic's onset, Airbnb's business is back and stronger than ever.

ABNB Revenue (TTM) Chart

ABNB Revenue (TTM) data by YCharts.

Note that Airbnb does not own the properties listed on its platform. Instead, it chooses to bring together those with a place they would like to rent out and those looking for a place to stay. One of the benefits of the business model is that it's asset-light, allowing Airbnb to expand with relatively little capital investment. 

Gross booking value, which measures the dollar value of reservations made on Airbnb's platform, increased by 67% from the same quarter last year, and 73% from the same quarter in 2019. The figure is crucial because this is the base from which Airbnb takes a percentage for itself as revenue. The surge in gross booking value highlights that Airbnb's growth is from organic consumer demand rather than an increase in the fees it charges guests and hosts.

Worldwide spending on hotels and resorts decreased by a whopping $837 billion in 2020 due to the pandemic. In 2021, spending on the category rebounded by $340 billion. Still, there is nearly $500 billion in lost revenue from the pandemic that the travel industry has yet to recover. The gap is good news for Airbnb, which is already boasting higher revenue than before the outbreak. As worldwide spending on travel continues to rebound, Airbnb should ride that tailwind higher.

Airbnb boasts excellent prospects and a bargain price

The recovery helped Airbnb report its first-ever first quarter, where adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were positive. At $229 million, adjusted EBITDA improved from a loss of $59 million in the metric in the same quarter last year.

Management expects this momentum to continue and provided insights into the rest of 2022 in the shareholder letter that accompanied its Q1 earnings release: "Looking ahead, we see strong sustained pent-up demand. As of the end of April 2022, we had 30% more nights booked for the summer travel season than at this time in 2019, and the growth from 2019 is higher the further we look out this year."

ABNB Price to Free Cash Flow Chart

ABNB Price to Free Cash Flow data by YCharts.

Unsurprisingly, the stock was higher just following the earnings release. Still, Airbnb is trading at a price-to-free-cash-flow ratio of 45, near to its lowest level ever. With such excellent prospects and an attractive valuation, investors can put Airbnb on the top of their list of stocks to buy.