In its first earnings call since going public in January, short-term rental provider Sonder reported a 28 percent year-over-year increase in fourth-quarter revenue and detailed its strategy for the corporate travel market.
Sonder went public on Jan. 19 through a merger with special purpose acquisition company Gores Metropoulos II.
In the fourth quarter of 2021, the San Francisco-based company posted $86.7 million in revenue, a 28 percent increase compared to fourth quarter 2020; and a net loss of $77.3 million, compared with a net loss of $72 million in the same period in 2020. Full-year Sonder revenue totaled $232.9 million in 2021.
Sonder pointed to recent corporate travel highlights, including what it called 100 new corporate clients signed during the pandemic and partnerships with travel management companies Egencia and TripActions and booking platform Hotel Engine. Revenue growth in the fourth quarter was attributed in part to the corporate travel focus.
Sonder founder and CEO Francis Davidson noted the company's inventory is listed in global distribution systems as evidence of the company's corporate travel strategy.
Davidson characterized corporate travel as “incremental revenue” compared with leisure demand, but the company's strategy includes “corporate housing, or internships and relocations—those are all sources of demand that are additive to what we were capable of doing prior to the pandemic.”
Also citing a nomadic workforce created in part by the pandemic, Davidson said, “There are going to be a lot of important changes [in the corporate travel sector], and we're ready to take advantage of them as the market recovers.”
Key Performance Metrics
Sonder’s fourth-quarter 2021 revenue per available room reached 112 percent compared to fourth quarter 2019. Full-year 2021 RevPAR reached 82 percent of the full-year 2019 level. The company's fourth-quarter occupancy 2021 grew 1 percent year over year. Bookable nights in the Sonder portfolio increased 59 percent during the same period.
Sonder’s total unit portfolio, which numbered 18,100 at the end of December 2021, grew by more than 6,000 units since the same period in 2020. But when asked about future pipeline, Davidson only said, “Our deep pipeline of prospective properties that will deliver in 2023 and beyond makes us very excited about the future growth prospects. But of course, we're not going to provide outlook for 2023 or future years.”
2022 Outlook
“We entered this year with strong momentum,” said Sonder president and CFO Sanjay Banker, “and we're optimistic about our trajectory and the large market opportunity ahead of us. In the first quarter of 2022, we anticipate revenue of more than $75 million, representing a 138 percent year-over-year growth, versus $32 million in the first quarter of 2021.” Banker added that the decrease from fourth-quarter 2021 revenue was to RevPAR seasonality, which was also impacted by the omicron variant of Covid-19. “As a result, we expect Q1 2022 RevPAR to decline versus Q4 2021, but still meaningfully improve year-over-year versus Q1 2021.”