Airbnb's share price more than doubles in much-anticipated debut

Airbnb, Inc. enjoyed a spectacular debut Thursday on Wall Street, attracting a surge of interest from investors that caused its share price to more than double.

The share price of that San Francisco-based peer-to-peer lodging service, which had priced its initial public offering at $68 per share, skyrocketed to $165 before closing up 112.8 percent at $144.71 in trading on the tech-heavy Nasdaq stock exchange.

Airbnb's market capitalization now stands at around $86.5 billion, slightly more than more established rival Booking Holdings, an owner and operator of several travel fare aggregators and metasearch engines.

Its market cap now also far exceeds that of large hotel chains like Marriott and Hilton, which currently have a valuation of $42 billion and $29 billion, respectively.

Airbnb's market cap is at a level that was virtually unimaginable just a few months ago, when it was hammered by the onset of the coronavirus crisis and was valued at just $18 billion during a private fundraising round in April.

The health emergency prompted the company to lay off roughly one-fourth of its 7,600 employees, slash marketing costs and salaries, seek out capital injections, scale back bets on its secondary offerings and refocus on its core business of home-sharing.

CEO Brian Chesky recalled on Thursday in an interview with American financial news network CNBC that Airbnb lost 80 percent of its business at the early stages of the lockdown.

But reservations on its platform started to recover in the third quarter thanks above all to many American vacationers' decision to stay at rural houses near their homes.

Between July and September, Airbnb managed to post a $219 million profit despite a sharp drop in year-over-year revenue.

Airbnb's Wall Street debut was one of the most anticipated of 2020 and came a day after San Francisco-based food delivery service DoorDash's shares soared by 80 percent in its first day of trading in New York on Wednesday.

Founded in 2008, Airbnb disrupted the hotel industry by popularizing the idea of renting out a house for a short time frame.

Despite numerous legal battles over its business model, it has managed to expand nearly worldwide and now not only offers house and room rentals on its platform but also the possibility of reserving stays at tourist establishments and different types of vacation activities.