Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
Economic Profit
Airbnb Inc., economic profit calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 2,486 – 18.86% × 5,761 = 1,400
The financial trajectory from 2021 to 2025 reveals a significant transition from value destruction to consistent value creation. A critical pivot occurred between 2021 and 2022, marking the shift from a negative economic profit to a positive state, indicating that operating returns began to exceed the required return on invested capital.
- Net Operating Profit After Taxes (NOPAT)
- A strong overall growth trend is observed in NOPAT, which rose from US$ 465 million in 2021 to a peak of US$ 2,644 million in 2024. Although a contraction occurred in 2023 (US$ 1,681 million) and a slight decline was noted in 2025 (US$ 2,486 million), the operational earning capacity remains substantially higher than the 2021 baseline.
- Cost of Capital and Invested Capital
- The cost of capital remained remarkably stable across the five-year period, fluctuating minimally around the 19% mark. Invested capital reached a peak of US$ 6,894 million in 2022 before trending downward to US$ 5,761 million by 2025. This reduction in the capital base, occurring alongside rising NOPAT, suggests an improvement in capital efficiency.
- Economic Profit Evolution
- Economic profit moved from a deficit of US$ 650 million in 2021 to a positive US$ 760 million in 2022. Following a dip to US$ 555 million in 2023, a sharp increase was recorded in 2024, reaching US$ 1,479 million, and remaining robust at US$ 1,400 million in 2025. The expansion of economic profit is primarily attributed to the growth in NOPAT and the optimization of invested capital against a constant cost of capital.
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Net Operating Profit after Taxes (NOPAT)
Airbnb Inc., NOPAT calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in customer receivable reserve.
3 Addition of increase (decrease) in unearned fees.
4 Addition of increase (decrease) in equity equivalents to net income (loss).
5 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 272 × 7.40% = 20
6 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 23 × 21.00% = 5
7 Addition of after taxes interest expense to net income (loss).
8 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 705 × 21.00% = 148
9 Elimination of after taxes investment income.
Net operating profit after taxes (NOPAT) exhibited considerable fluctuation over the five-year period. While net income demonstrated a significant recovery from a loss in 2021, NOPAT presents a more nuanced picture of operational profitability. An initial increase in NOPAT was followed by a decline and subsequent recovery.
- Overall Trend
- NOPAT increased from US$465 million in 2021 to US$2,070 million in 2022, representing substantial growth. However, this was followed by a decrease to US$1,681 million in 2023. A recovery was then observed in 2024, with NOPAT reaching US$2,644 million, and this level was largely maintained in 2025 at US$2,486 million.
- Year-over-Year Changes
- The largest year-over-year increase in NOPAT occurred between 2021 and 2022, with a growth of US$1,605 million. The subsequent decline between 2022 and 2023 was US$389 million. The recovery from 2023 to 2024 amounted to US$963 million, and the change from 2024 to 2025 was a decrease of US$158 million.
- Relationship to Net Income
- While both NOPAT and net income increased significantly from 2021 to 2022, the divergence between the two metrics in 2023 suggests factors beyond core operational profitability influenced net income. The continued growth in NOPAT in 2024, despite a decrease in net income compared to 2023, further supports this observation. The relatively stable NOPAT in 2025, alongside a slight decrease in net income, indicates a consistent operational performance despite potential non-operating influences on the bottom line.
The fluctuations in NOPAT suggest that operational performance is subject to external factors or strategic decisions that impact profitability after considering operating taxes. Further investigation into the components of NOPAT and net income would be necessary to fully understand the drivers behind these trends.
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Cash Operating Taxes
Airbnb Inc., cash operating taxes calculation
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The provision for (benefit from) income taxes exhibits significant volatility over the observed period. Beginning at US$52 million in 2021, it increased to US$96 million in 2022 before experiencing a substantial negative swing to a benefit of negative US$2,690 million in 2023. This was followed by a return to positive provisions of US$683 million in 2024 and US$626 million in 2025.
Cash operating taxes demonstrate a generally increasing trend, albeit with fluctuations. The value decreased from US$139 million in 2021 to US$68 million in 2022, then declined further to US$56 million in 2023. A subsequent increase is observed in 2024, reaching US$88 million, and continuing into 2025 with a value of US$107 million.
- Provision for Income Taxes Trend
- The dramatic shift from a provision to a significant benefit in 2023 warrants further investigation. This could be attributable to changes in tax laws, utilization of net operating loss carryforwards, or other tax planning strategies. The return to positive provisions in 2024 and 2025 suggests a normalization of the tax position, but the levels remain below those seen in 2021 and 2022.
- Cash Operating Taxes vs. Provision for Income Taxes
- A divergence is apparent between the provision for income taxes and cash operating taxes. While the provision for income taxes experienced extreme fluctuations, cash operating taxes remained relatively stable, albeit with a general upward trend. This discrepancy suggests timing differences between reported income tax expense and actual cash payments, or the impact of deferred tax items. The cash operating taxes are consistently lower than the provision for income taxes, except in 2023 where the benefit from income taxes is significantly larger than the cash operating taxes.
- Overall Tax Impact
- The company’s effective tax rate, while not directly calculable from this information, is clearly impacted by the volatility in the provision for income taxes. The large benefit in 2023 likely resulted in a significantly reduced effective tax rate for that year. The increasing cash operating taxes in the later years may indicate a growing tax burden as profitability increases, despite the continued presence of deferred tax assets or other tax benefits.
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Invested Capital
Airbnb Inc., invested capital calculation (financing approach)
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of unearned fees.
5 Addition of equity equivalents to stockholders’ equity.
6 Removal of accumulated other comprehensive income.
7 Subtraction of short-term investments.
The composition of the company’s capital structure exhibits notable shifts over the five-year period. Total reported debt and leases demonstrate a consistent, albeit modest, decline annually, decreasing from US$2,418 million in 2021 to US$2,271 million in 2025. Conversely, stockholders’ equity experienced substantial growth between 2021 and 2023, increasing from US$4,776 million to US$8,165 million, before stabilizing and experiencing a slight decrease to US$8,199 million in 2025. Invested capital initially increased from 2021 to 2022, then decreased in 2023, followed by a slight increase in 2024, and a further decrease in 2025.
- Total Reported Debt & Leases
- A consistent downward trend is observed in total reported debt and leases throughout the period. This suggests a deliberate strategy to reduce reliance on debt financing, potentially improving financial flexibility or reducing interest expenses. The rate of decline is relatively stable, indicating a consistent approach to debt management.
- Stockholders’ Equity
- Stockholders’ equity demonstrates significant growth from 2021 to 2023, indicating strong earnings retention or successful equity issuance. The growth rate slows considerably in 2024 and 2025, with a slight decrease in the latter year. This stabilization may reflect changes in profitability, dividend payouts, or share repurchase activity.
- Invested Capital
- Invested capital initially rose in 2022, likely driven by increases in both debt and equity. However, a decrease is observed in 2023, despite the continued growth in stockholders’ equity. This suggests a potential reduction in operational assets or a change in working capital management. A slight recovery in 2024 is followed by a further decrease in 2025, indicating continued volatility in capital deployment. The fluctuations in invested capital warrant further investigation to understand the underlying drivers.
The interplay between these components suggests a shift in the company’s capital structure towards greater reliance on equity financing. While debt levels are decreasing, the growth in equity has not consistently translated into increased invested capital, indicating potential changes in asset utilization or investment strategies.
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Cost of Capital
Airbnb Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 70,586) | 70,586) | ÷ | 72,858) | = | 0.97 | 0.97 | × | 19.44% | = | 18.83% | ||
| Debt3 | 2,000) | 2,000) | ÷ | 72,858) | = | 0.03 | 0.03 | × | 0.20% × (1 – 21.00%) | = | 0.00% | ||
| Operating lease liability4 | 272) | 272) | ÷ | 72,858) | = | 0.00 | 0.00 | × | 7.40% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 72,858) | 1.00 | 18.86% | ||||||||||
Based on: 10-K (reporting date: 2025-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 88,931) | 88,931) | ÷ | 91,130) | = | 0.98 | 0.98 | × | 19.44% | = | 18.97% | ||
| Debt3 | 1,900) | 1,900) | ÷ | 91,130) | = | 0.02 | 0.02 | × | 0.20% × (1 – 21.00%) | = | 0.00% | ||
| Operating lease liability4 | 299) | 299) | ÷ | 91,130) | = | 0.00 | 0.00 | × | 7.30% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 91,130) | 1.00 | 18.99% | ||||||||||
Based on: 10-K (reporting date: 2024-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 98,684) | 98,684) | ÷ | 100,797) | = | 0.98 | 0.98 | × | 19.44% | = | 19.03% | ||
| Debt3 | 1,800) | 1,800) | ÷ | 100,797) | = | 0.02 | 0.02 | × | 0.20% × (1 – 21.00%) | = | 0.00% | ||
| Operating lease liability4 | 313) | 313) | ÷ | 100,797) | = | 0.00 | 0.00 | × | 7.20% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 100,797) | 1.00 | 19.05% | ||||||||||
Based on: 10-K (reporting date: 2023-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 84,294) | 84,294) | ÷ | 86,348) | = | 0.98 | 0.98 | × | 19.44% | = | 18.98% | ||
| Debt3 | 1,700) | 1,700) | ÷ | 86,348) | = | 0.02 | 0.02 | × | 0.20% × (1 – 21.00%) | = | 0.00% | ||
| Operating lease liability4 | 354) | 354) | ÷ | 86,348) | = | 0.00 | 0.00 | × | 7.00% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 86,348) | 1.00 | 19.00% | ||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 99,703) | 99,703) | ÷ | 102,103) | = | 0.98 | 0.98 | × | 19.44% | = | 18.98% | ||
| Debt3 | 1,964) | 1,964) | ÷ | 102,103) | = | 0.02 | 0.02 | × | 0.20% × (1 – 21.00%) | = | 0.00% | ||
| Operating lease liability4 | 436) | 436) | ÷ | 102,103) | = | 0.00 | 0.00 | × | 6.80% × (1 – 21.00%) | = | 0.02% | ||
| Total: | 102,103) | 1.00 | 19.01% | ||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in millions
2 Equity. See details »
3 Debt. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Airbnb Inc., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | 1,400) | 1,479) | 555) | 760) | (650) | |
| Invested capital2 | 5,761) | 6,133) | 5,911) | 6,894) | 5,866) | |
| Performance Ratio | ||||||
| Economic spread ratio3 | 24.30% | 24.12% | 9.38% | 11.02% | -11.09% | |
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| Booking Holdings Inc. | 24.25% | 29.11% | 14.66% | 3.80% | -13.64% | |
| Chipotle Mexican Grill Inc. | 9.14% | 8.60% | 7.02% | 2.82% | -1.67% | |
| DoorDash, Inc. | -18.94% | -26.98% | -39.42% | -53.20% | -39.71% | |
| McDonald’s Corp. | 9.05% | 8.56% | 8.64% | 5.84% | 8.26% | |
| Starbucks Corp. | -4.64% | 3.51% | 5.21% | 2.81% | 4.06% | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 1,400 ÷ 5,761 = 24.30%
4 Click competitor name to see calculations.
The financial trajectory from 2021 to 2025 demonstrates a significant transition from economic value destruction to sustainable value creation. This progression is characterized by a reversal in economic profit and a substantial expansion of the economic spread ratio, indicating a strengthened ability to generate returns above the cost of capital.
- Economic Profit
- A marked recovery is observed starting in 2022, where economic profit shifted from a deficit of 650 million USD in 2021 to a surplus of 760 million USD. Despite a slight contraction to 555 million USD in 2023, a sharp increase occurred in 2024, peaking at 1,479 million USD before stabilizing at 1,400 million USD in 2025. This trend reflects a substantial improvement in operational efficiency and profitability.
- Invested Capital
- The capital base remained relatively stable over the five-year period, fluctuating between a low of 5,761 million USD in 2025 and a peak of 6,894 million USD in 2022. The observation that economic profit increased significantly while invested capital generally trended downward or remained flat suggests an optimization of asset utilization and capital efficiency.
- Economic Spread Ratio
- The economic spread ratio exhibits the most dramatic volatility and growth, moving from -11.09% in 2021 to 24.30% by 2025. The transition to a positive ratio in 2022 marks the point where the return on invested capital began to exceed the cost of capital. The subsequent surge to over 24% in 2024 and 2025 indicates a widening gap between the generated returns and the capital costs, signifying a high level of economic value added per unit of capital employed.
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Economic Profit Margin
Airbnb Inc., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Economic profit1 | 1,400) | 1,479) | 555) | 760) | (650) | |
| Revenue | 12,241) | 11,102) | 9,917) | 8,399) | 5,992) | |
| Add: Increase (decrease) in unearned fees | 127) | 189) | 245) | 278) | 496) | |
| Adjusted revenue | 12,368) | 11,291) | 10,162) | 8,677) | 6,488) | |
| Performance Ratio | ||||||
| Economic profit margin2 | 11.32% | 13.10% | 5.46% | 8.75% | -10.03% | |
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| Booking Holdings Inc. | 11.63% | 15.91% | 7.83% | 3.04% | -18.68% | |
| Chipotle Mexican Grill Inc. | 5.59% | 5.17% | 4.26% | 1.75% | -1.21% | |
| DoorDash, Inc. | -15.53% | -15.76% | -23.91% | -42.99% | -25.83% | |
| McDonald’s Corp. | 18.03% | 16.40% | 16.95% | 11.43% | 16.97% | |
| Starbucks Corp. | -3.01% | 2.29% | 3.22% | 1.79% | 3.31% | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Economic profit. See details »
2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × 1,400 ÷ 12,368 = 11.32%
3 Click competitor name to see calculations.
A significant transition in value creation is evident over the five-year period, moving from a state of economic value destruction in 2021 to consistent economic profit generation through 2025. This trajectory is supported by a steady increase in adjusted revenue, indicating a scalable growth model that has successfully optimized capital efficiency over time.
- Adjusted Revenue Growth
- A consistent upward trend is observed in adjusted revenue, which grew from 6,488 million US dollars in 2021 to 12,368 million US dollars by 2025. This represents a continuous expansion of the top line, providing a broader base for generating economic profit.
- Economic Profit Volatility and Recovery
- Economic profit experienced a sharp turnaround, shifting from a deficit of 650 million US dollars in 2021 to a positive 760 million US dollars in 2022. Although a moderate decline to 555 million US dollars occurred in 2023, a substantial surge followed, peaking at 1,479 million US dollars in 2024 before stabilizing at 1,400 million US dollars in 2025.
- Economic Profit Margin Analysis
- The economic profit margin mirrors the profit trends, starting at -10.03% in 2021. The margin became positive in 2022 at 8.75%, dipped to 5.46% in 2023, and reached a period high of 13.10% in 2024. The final observation in 2025 shows a slight contraction to 11.32%, suggesting that while the company remains highly value-additive, the rate of economic profit growth slightly trailed revenue growth in the final year.
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