Airbnb (NASDAQ:ABNB) shares dropped over 3% on Tuesday as Spain ordered the removal of 65,000 rental listings from the platform, citing violations of tourist accommodation regulations. This regulatory action comes amid growing anti-tourism sentiment in popular Spanish destinations, adding pressure to the company’s European operations.
Spain shuts down 65,000 Airbnb Rentals
The Spanish government has ordered Airbnb to remove approximately 65,000 property listings from its platform, representing a significant regulatory blow to the vacation rental company in one of the world’s most popular tourist destinations. According to Spain’s Consumer Rights Ministry, the targeted listings violated various regulations, primarily failing to include proper license numbers or not specifying whether the owner was operating as an individual or corporation.
The crackdown gained legal traction when a Madrid court ruled that Airbnb must immediately withdraw 5,800 of these properties, with decisions on the remaining 60,000 listings still pending.
Consumer Rights Minister Pablo Bustinduy framed the action as a necessary step to end what he called the “lack of control” and “illegality” in the holiday rental sector, stating emphatically: “No more excuses. Enough with protecting those who make a business out of the right to housing in our country.”
The government’s move represents part of a broader effort to address Spain’s housing crisis, with officials increasingly targeting short-term rentals as a factor driving up housing costs for local residents. The intervention comes against a backdrop of housing becoming Spaniards’ primary concern, with average rental prices having doubled over the past decade while salaries failed to keep pace.
Spain’s Prime Minister Pedro Sánchez recently stated that “there are too many Airbnbs and not enough homes,” pledging to prevent the “uncontrolled” expansion of properties used for tourism.
Airbnb has responded defiantly, announcing it will appeal the decision and arguing that the ministry lacks proper authority over short-term rentals. The company maintains that the government failed to provide evidence-based identification of non-compliant accommodations and noted that some of the targeted listings are seasonal rentals not subject to tourism regulations. Airbnb cited a 2022 Spanish Supreme Court ruling that placed responsibility for listing information with individual hosts rather than the platform itself, which it described as a “neutral intermediary.”
The company further argued that regulating its operations won’t solve Spain’s housing challenges, claiming “the root cause of the affordable housing crisis in Spain is a lack of supply to meet demand.” This regulatory clash coincides with intensifying anti-tourism sentiment across Spain, with thousands protesting in the Canary Islands on Sunday under the slogan “Canaries have a limit.”
Similar demonstrations are planned in Majorca for June 15 by a group called “Less Tourism, More Life.” The backlash against mass tourism is growing as Spain approaches 100 million annual foreign visitors, having hosted 94 million in 2024 (a 13% increase from the previous year).
Local governments are also taking independent action, with Barcelona’s city council announcing plans to eliminate all 10,000 short-term tourist apartments by the end of 2028.
Airbnb Stock Slides Amid Regulatory Uncertainty in Spain
Airbnb stock (ABNB) was trading at $132.46 as of 10:16 AM EDT on Tuesday, down sharply by $4.14 or 3.03% from the previous close of $136.60. The stock opened at $133.75 and has traded within a day range of $132.16 to $134.60, showing moderate volatility amid the negative news from Spain. Trading volume has reached 1,426,176 shares, still below the average daily volume of 5,806,721, suggesting that while the news has impacted the share price, it hasn’t triggered extraordinarily heavy selling pressure.
The stock’s performance metrics present a mixed picture across different timeframes. Year-to-date, Airbnb shares have eked out a modest gain of 0.80%, slightly underperforming the S&P 500’s 1.04% rise over the same period. More concerning for investors is the one-year performance, with ABNB down 9.50% while the broader market has gained 11.95%.
The three-year return shows stronger performance at +17.69%, though this still significantly trails the S&P 500’s +52.32% over the same period. The five-year picture is similarly underwhelming, with Airbnb down 9.27% compared to the S&P 500’s nearly 100% gain, though this timeframe includes the company’s 2020 IPO and the challenging pandemic period for travel companies.
From a valuation perspective, the stock trades at a trailing price-to-earnings ratio of 34.67 and a forward P/E of 31.35, reflecting the premium investors are willing to pay for the company’s growth potential despite regulatory headwinds.
The company maintains solid profitability metrics with a 22.60% profit margin and trailing twelve-month revenue of $11.23 billion with net income of $2.54 billion. Airbnb’s balance sheet appears strong with $11.49 billion in cash and a relatively modest debt-to-equity ratio of 28.73%, providing financial flexibility as it navigates regulatory challenges in key markets.
Wall Street maintains a cautious outlook on the stock, with a consensus price target of $139.33, suggesting limited upside potential of approximately 5% from current levels. The company is expected to report its next quarterly earnings between August 4-8, 2025, with analysts forecasting earnings per share of $0.93.
Technical analysts note that the stock is now trading below all major moving averages, with the breaking of support at $135 potentially opening the door to further declines toward the $130 level if negative sentiment persists around regulatory risks in key markets like Spain.
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Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.
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