Brian Chesky, CEO and Co-founder of Airbnb, speaks to the Economic Club of New York at a luncheon at the New York Stock Exchange (NYSE) in New York, U.S. March 13, 2017. REUTERS/Mike Segar

  • Airbnb was unprofitable during the first nine months of 2019, according to a report Tuesday from the Wall Street Journal.
  • The report said Airbnb lost $322 million, compared to a $200 million profit during the same period a year prior, and that costs climbed faster than revenue in its third quarter.
  • Airbnb’s latest internal audit estimated the company at significantly lower than its previous private valuation of $31 billion, according to the report.
  • Sources also told the paper that the coronavirus outbreak, which forced Airbnb to suspend bookings in China, could impact its timing as it looks to go public in 2020.
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Airbnb may have additional challenges to navigate as it looks to go public in 2020.

The multibillion-dollar travel company reportedly lost money during the first nine months of last year, according to a report published by the Wall Street Journal on Tuesday.

The report said Airbnb posted a net loss of $322 million through September 2019, after making a profit of $200 million the previous year. It also said that, while the company’s revenue increased to $1.65 billion in the third quarter, up $400 million from the year prior, costs grew faster.

That could give pause to investors, many of whom have become wary of businesses without a clear path to profit after last year’s crop of money-losing companies going public with mixed results and WeWork’s cancelled IPO.

Airbnb appears to be facing rising costs as it continues to grow, including a $150 million investment in improving the safety of its platform, as well as increased overhead expenses and sales and marketing costs.

The company reportedly has around $3 billion in cash on hand and some investors think the company has a stronger business model than multibillion-dollar predecessors like Uber and WeWork, but Tuesday’s report could mean the company will face increased pressure to prove that its financials add up.

Airbnb said last fall that it expects to become a public company sometime in 2020, but sources told the Wall Street Journal that could likely mean the third quarter at the earliest and that the timing could be affected by the Wuhan coronavirus outbreak.

Airbnb has worked hard to gain a foothold in China, but according to Tuesday’s report, those numbers may have taken as much as an 80% hit this year. The company has suspended bookings within Beijing and allowed customers to cancel trips free of charge, but it’s unclear how significantly the outbreak has impacted its business.

Airbnb declined to comment on the Wall Street Journal’s report.

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