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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
Net Operating Profit after Taxes (NOPAT)
Cash Operating Taxes
Invested Capital
Cost of Capital
Economic Spread Ratio
Economic Profit Margin

Airbnb Inc., economic profit calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net operating profit after taxes (NOPAT)¹	1,681)	2,070)	465)	(4,675)
Cost of capital²	15.70%	15.66%	15.67%	15.87%
Invested capital³	5,829)	6,849)	5,836)	4,764)

Economic profit⁴	765)	997)	(450)	(5,431)

Based on: 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).

¹ NOPAT. See details »

² Cost of capital. See details »

³ Invested capital. See details »

⁴ 2023 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 1,681 – 15.70% × 5,829 = 765

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Item	Description	The company
Economic profit	Economic profit is a measure of corporate performance computed by taking the spread between the return on invested capital and the cost of capital, and multiplying by the invested capital.	Airbnb Inc. economic profit increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Airbnb Inc., NOPAT calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income (loss)	4,792)	1,893)	(352)	(4,585)
Deferred income tax expense (benefit)¹	(2,875)	(1)	11)	(20)
Increase (decrease) in customer receivable reserve²	5)	8)	(60)	39)
Increase (decrease) in unearned fees³	245)	278)	496)	(267)
Increase (decrease) in equity equivalents⁴	(2,625)	285)	447)	(247)
Interest expense	83)	24)	438)	172)
Interest expense, operating lease liability⁵	23)	25)	30)	32)
Adjusted interest expense	106)	49)	467)	204)
Tax benefit of interest expense⁶	(22)	(10)	(98)	(43)
Adjusted interest expense, after taxes⁷	83)	39)	369)	161)
(Gain) loss on marketable securities	—)	—)	13)	22)
Interest income	(721)	(186)	(13)	(27)
Investment income, before taxes	(721)	(186)	1)	(5)
Tax expense (benefit) of investment income⁸	151)	39)	—)	1)
Investment income, after taxes⁹	(570)	(147)	1)	(4)
Net operating profit after taxes (NOPAT)	1,681)	2,070)	465)	(4,675)

Based on: 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).

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 2023 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 313 × 7.20% = 23

⁶ 2023 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 106 × 21.00% = 22

⁷ Addition of after taxes interest expense to net income (loss).

⁸ 2023 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 721 × 21.00% = 151

⁹ Elimination of after taxes investment income.

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Item	Description	The company
NOPAT	Net operating profit after taxes is income from operations, but after removement of taxes calculated on cash basis that are relevant to operating income.	Airbnb Inc. NOPAT increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Airbnb Inc., cash operating taxes calculation

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Provision for (benefit from) income taxes	(2,690)	96)	52)	(97)
Less: Deferred income tax expense (benefit)	(2,875)	(1)	11)	(20)
Add: Tax savings from interest expense	22)	10)	98)	43)
Less: Tax imposed on investment income	151)	39)	—)	1)
Cash operating taxes	56)	68)	139)	(36)

Based on: 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).

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Item	Description	The company
Cash operating taxes	Cash operating taxes are estimated by adjusting income tax expense for changes in deferred taxes and tax benefit from the interest deduction.	Airbnb Inc. cash operating taxes decreased from 2021 to 2022 and from 2022 to 2023.

Airbnb Inc., invested capital calculation (financing approach)

US$ in millions

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Current portion of long-term debt	—)	—)	—)	10)
Long-term debt, net of current portion	1,991)	1,987)	1,983)	1,816)
Operating lease liability¹	313)	354)	436)	487)
Total reported debt & leases	2,304)	2,341)	2,418)	2,313)
Stockholders’ equity	8,165)	5,560)	4,776)	2,902)
Net deferred tax (assets) liabilities²	(2,881)	(16)	(15)	(26)
Customer receivable reserve³	44)	39)	31)	91)
Unearned fees⁴	1,427)	1,182)	904)	408)
Equity equivalents⁵	(1,410)	1,205)	920)	473)
Accumulated other comprehensive (income) loss, net of tax⁶	49)	32)	7)	(3)
Adjusted stockholders’ equity	6,804)	6,797)	5,703)	3,372)
Construction in progress⁷	(82)	(45)	(30)	(11)
Short-term investments⁸	(3,197)	(2,244)	(2,255)	(911)
Invested capital	5,829)	6,849)	5,836)	4,764)

Based on: 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).

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 construction in progress.

⁸ Subtraction of short-term investments.

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Item	Description	The company
Invested capital	Capital is an approximation of the economic book value of all cash invested in going-concern business activities.	Airbnb Inc. invested capital increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.

Airbnb Inc., cost of capital calculations

Dec 31, 2023

	Capital (fair value)¹	Weights					Cost of capital
Equity²	98,684)	98,684)	÷	100,797)	=	0.98	0.98	×	16.02%	=	15.68%
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					15.70%

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 »

Dec 31, 2022

	Capital (fair value)¹	Weights					Cost of capital
Equity²	84,294)	84,294)	÷	86,348)	=	0.98	0.98	×	16.02%	=	15.64%
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					15.66%

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 »

Dec 31, 2021

	Capital (fair value)¹	Weights					Cost of capital
Equity²	99,703)	99,703)	÷	102,103)	=	0.98	0.98	×	16.02%	=	15.64%
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					15.67%

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 »

Dec 31, 2020

	Capital (fair value)¹	Weights					Cost of capital
Equity²	125,551)	125,551)	÷	128,338)	=	0.98	0.98	×	16.02%	=	15.67%
Debt³	2,300)	2,300)	÷	128,338)	=	0.02	0.02	×	12.31% × (1 – 21.00%)	=	0.17%
Operating lease liability⁴	487)	487)	÷	128,338)	=	0.00	0.00	×	6.60% × (1 – 21.00%)	=	0.02%
Total:	128,338)					1.00					15.87%

Based on: 10-K (reporting date: 2020-12-31).

¹ US$ in millions

² Equity. See details »

³ Debt. See details »

⁴ Operating lease liability. See details »

Airbnb Inc., economic spread ratio calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Selected Financial Data (US$ in millions)
Economic profit¹	765)	997)	(450)	(5,431)
Invested capital²	5,829)	6,849)	5,836)	4,764)
Performance Ratio
Economic spread ratio³	13.13%	14.55%	-7.71%	-114.01%
Benchmarks
Economic Spread Ratio, Competitors⁴
Booking Holdings Inc.	16.91%	6.01%	-11.41%	-11.09%
Chipotle Mexican Grill Inc.	7.67%	3.65%	-1.04%	-3.06%
McDonald’s Corp.	8.86%	6.07%	8.48%	4.22%
Starbucks Corp.	9.38%	6.96%	8.22%	-4.50%

Based on: 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).

¹ Economic profit. See details »

² Invested capital. See details »

³ 2023 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 765 ÷ 5,829 = 13.13%

⁴ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic spread ratio	The ratio of economic profit to invested capital, also equal to the difference between return on invested capital (ROIC) and cost of capital.	Airbnb Inc. economic spread ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Airbnb Inc., economic profit margin calculation, comparison to benchmarks

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Selected Financial Data (US$ in millions)
Economic profit¹	765)	997)	(450)	(5,431)

Revenue	9,917)	8,399)	5,992)	3,378)
Add: Increase (decrease) in unearned fees	245)	278)	496)	(267)
Adjusted revenue	10,162)	8,677)	6,488)	3,111)
Performance Ratio
Economic profit margin²	7.53%	11.49%	-6.93%	-174.56%
Benchmarks
Economic Profit Margin, Competitors³
Booking Holdings Inc.	9.03%	4.80%	-15.62%	-23.77%
Chipotle Mexican Grill Inc.	4.66%	2.27%	-0.75%	-2.51%
McDonald’s Corp.	17.40%	11.88%	17.42%	10.26%
Starbucks Corp.	5.80%	4.43%	6.70%	-4.39%

Based on: 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).

¹ Economic profit. See details »

² 2023 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × 765 ÷ 10,162 = 7.53%

³ Click competitor name to see calculations.

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Performance ratio	Description	The company
Economic profit margin	The ratio of economic profit to sales. It is the company profit margin covering income efficiency and asset management. Economic profit margin is not biased in favor of capital-intensive business models, because any added capital is a cost to the economic profit margin.	Airbnb Inc. economic profit margin improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Airbnb Inc. (NASDAQ:ABNB)

Economic Value Added (EVA)

Economic Profit

Net Operating Profit after Taxes (NOPAT)

Cash Operating Taxes

Invested Capital

Cost of Capital

Economic Spread Ratio

Economic Profit Margin