Enterprise Value to FCFF (EV/FCFF)
Free Cash Flow to The Firm (FCFF)
Airbnb Inc., FCFF calculation
US$ in millions
Based on: 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), 10-K (reporting date: 2020-12-31).
The data reveals a clear positive trend in both net cash provided by operating activities and free cash flow to the firm (FCFF) over the five-year period.
- Net Cash Provided by (Used in) Operating Activities
- There is a significant turnaround from a negative cash flow of -630 million US dollars in 2020 to a positive inflow in subsequent years. The amount increased substantially to 2190 million US dollars in 2021, followed by continuous growth through 2022 (3430 million), 2023 (3884 million), and reaching 4518 million US dollars in 2024. This indicates improved operational efficiency and stronger cash generation capabilities over time.
- Free Cash Flow to the Firm (FCFF)
- FCFF follows a similar trajectory as net cash from operations, starting from a negative 540 million US dollars in 2020 and jumping to 2204 million in 2021. The positive momentum continues with increases to 3413 million in 2022, 3880 million in 2023, and 4486 million in 2024. The close alignment of FCFF values with net cash provided by operating activities suggests that capital expenditures and other investments have not significantly offset the company's cash-generating ability.
- Overall Insights
- The data reflects a strong recovery and steady improvement in liquidity and financial health, particularly after 2020. The consistent increases point to effective operational management and possibly expanding business activities that generate increasing cash flows. The improvements in FCFF confirm the firm's capacity to generate cash after necessary investments, further supporting sustainable growth and financial stability.
Interest Paid, Net of Tax
Airbnb Inc., interest paid, net of tax calculation
US$ in millions
Based on: 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), 10-K (reporting date: 2020-12-31).
2 2024 Calculation
Cash paid for interest, tax = Cash paid for interest × EITR
= 2 × 20.50% = 0
- Effective Income Tax Rate (EITR) Trend Analysis
- The effective income tax rate exhibits considerable volatility over the five-year period. It started at a very low level of 2.1% in 2020, jumped significantly to 21% in 2021, then sharply declined to 4.8% in 2022. Following this dip, the tax rate rose again to 21% in 2023 and slightly decreased to 20.5% in 2024. This pattern indicates irregular fluctuations in tax liabilities or tax planning outcomes, with rates aligning closer to the standard corporate tax rate in the latter years except for the dips in 2020 and 2022.
- Cash Paid for Interest, Net of Tax (Millions) Trend Analysis
- The cash paid for interest, net of tax, shows a clear declining trend from 2020 through 2024. Starting at 127 million US dollars in 2020, it sharply fell to 39 million in 2021, then continued to decrease to a low of 8 million in 2022. There was a slight increase to 43 million in 2023, followed by a drop to just 2 million in 2024. This trend suggests a progressive reduction in interest expenses or an overall decrease in debt levels, with a brief resurgence in 2023 before the substantial decrease in the final year.
Enterprise Value to FCFF Ratio, Current
Airbnb Inc., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | 75,649) |
| Free cash flow to the firm (FCFF) | 4,486) |
| Valuation Ratio | |
| EV/FCFF | 16.86 |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Booking Holdings Inc. | 21.44 |
| Chipotle Mexican Grill Inc. | 47.50 |
| McDonald’s Corp. | 31.34 |
| Starbucks Corp. | 31.12 |
| EV/FCFF, Sector | |
| Consumer Services | 26.53 |
| EV/FCFF, Industry | |
| Consumer Discretionary | 39.34 |
Based on: 10-K (reporting date: 2024-12-31).
1 Click competitor name to see calculations.
If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.
Enterprise Value to FCFF Ratio, Historical
Airbnb Inc., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Enterprise value (EV)1 | 80,315) | 90,604) | 76,659) | 93,363) | 120,985) | |
| Free cash flow to the firm (FCFF)2 | 4,486) | 3,880) | 3,413) | 2,204) | (540) | |
| Valuation Ratio | ||||||
| EV/FCFF3 | 17.91 | 23.35 | 22.46 | 42.36 | — | |
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Booking Holdings Inc. | 19.06 | 17.62 | 14.11 | 36.39 | — | |
| Chipotle Mexican Grill Inc. | 49.96 | 57.71 | 51.53 | 50.61 | 146.36 | |
| McDonald’s Corp. | 33.05 | 30.11 | 35.39 | 26.32 | 34.80 | |
| Starbucks Corp. | 32.92 | 32.25 | 42.44 | 28.09 | 281.97 | |
| EV/FCFF, Sector | ||||||
| Consumer Services | 26.84 | 26.60 | 27.99 | 31.26 | 115.64 | |
| EV/FCFF, Industry | ||||||
| Consumer Discretionary | 41.92 | 33.08 | 50.80 | 60.24 | 46.23 | |
Based on: 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), 10-K (reporting date: 2020-12-31).
3 2024 Calculation
EV/FCFF = EV ÷ FCFF
= 80,315 ÷ 4,486 = 17.91
4 Click competitor name to see calculations.
The financial data from the recent five-year period reveals distinct trends regarding the company's enterprise value, free cash flow to the firm, and the valuation ratio derived from these figures.
- Enterprise Value (EV)
- The enterprise value demonstrates a general downward trend from 2020 through 2024. Starting at a peak of approximately 120.9 billion USD in 2020, it declined significantly to 93.4 billion USD in 2021, followed by a further decrease to 76.7 billion USD in 2022. In 2023, the enterprise value exhibited partial recovery, rising to 90.6 billion USD before declining again to 80.3 billion USD in 2024. This pattern suggests fluctuations in market perception of the company's value, with a notable reduction over the five-year horizon in spite of a moderate rebound in the penultimate year.
- Free Cash Flow to the Firm (FCFF)
- There is a clear positive trajectory in free cash flow to the firm over the examined timeframe. Initially negative at -540 million USD in 2020, the metric turned positive and showed substantial growth in the following years. By 2021, FCFF rose sharply to 2.2 billion USD, increased further to 3.4 billion USD in 2022, then continued its upward trend, reaching 3.9 billion USD in 2023 and expanding to 4.5 billion USD in 2024. The steady improvement in FCFF indicates enhanced operational efficiency and cash generation capability.
- EV to FCFF Ratio
- The EV/FCFF ratio exhibits a descending trend, starting from a high multiple of 42.36 in 2021, decreasing to 22.46 in 2022, then slightly increasing to 23.35 in 2023, before dipping again to 17.91 in 2024. The substantial drop from 2021 to 2022 suggests improved valuation relative to cash flow, potentially signaling that the firm's market value became more aligned with its cash-generating ability. The marginal increase in 2023 is reversed in 2024, continuing the downward trajectory, which reflects a market adjusting towards a more attractive valuation basis relative to free cash flow.
In summary, despite a decline in enterprise value over the period, the company has exhibited strong improvements in free cash flow generation. The decreasing EV/FCFF ratio may indicate increasing investor confidence in the sustainability and quality of the firm's cash flows or a market reassessment leading to a more favorable valuation relative to cash flow performance.