Risk Factors Update Summary

• Added taxes and tax collection obligations in various jurisdictions, with potential fines up to $20 million.
• Increased risk of significant civil claims, including class actions, potentially amounting to significant compensation or damages liabilities.
• An aggregate payment of 576 million Euro ($621 million) was made to settle a dispute with the Italian Revenue Agency. This significant payment could impact the company's financial condition.
• Addition of investments in private companies, potentially risky, impacting financial condition.
• Introduction of the EU AI Act and Directives impacting AI governance and civil liability in the EU.
• Expanded risk factors include broader supply chain sustainability issues, increased energy and water consumption.
• Increased compliance requirements and potential penalties under anti-corruption laws, exposing the company to significant financial and reputational harm.
• A significant portion of our costs are typically fixed across quarters or vary, impacting Free Cash Flow. This change might result in decreased Free Cash Flow.
• Change in voting power with founders holding a majority, affecting decision-making.
• Potential impact of regulatory changes on performance marketing effectiveness, leading to increased costs and liabilities.
• Increased regulatory action and uncertainty around international operations due to CJEU ruling.
• Surge in widespread cyber-attacks during the COVID-19 pandemic, increasing cybersecurity risks and potential for incidents.
• Increased regulatory scrutiny and potential liability related to information or content on the platform.
• Increased focus on media, legislative, and government scrutiny affecting brand and reputation.
• Introduction of corporate minimum tax on certain corporations with adjusted financial statement income over $1 billion.
• The company relies on Hosts and users to decide on bookings, with procedures in place to prevent fraud. This reliance on users could impact the safety and trustworthiness of the platform.
• Implementation of a foreign exchange cash flow hedging program to minimize effects of currency fluctuations.
• Heightened risk of cyberattacks and security incidents due to international operations and evolving technology systems.
• Enhanced emphasis on community support quality, technology, and staffing challenges due to significant growth.
• Potential significant fluctuations in results of operations due to seasonal trends and geographic mix.
• Potential dilution from sales or issuances of Class A common stock, impacting ownership.
• The number of offices increased from 54 to 57, with approximately 3,820,000 employees internationally. This indicates a significant expansion in the company's physical presence and workforce.
• Enhanced focus on AI, machine learning, and automated decision-making legal, business, and operational risks.
• The European Union unanimously agreed to implement minimum tax rate legislation by December 31, 2023, in all EU member states. This change could affect the company's tax obligations and financial performance.
• Increased focus on brand marketing to attract and retain Hosts and guests, with a shift from performance marketing.
• Growing importance of ESG issues, evolving regulations, and potential impact on operations and financial condition.
• Revenue generated from listings increased from 54% to 57%. This change reflects a notable shift in revenue sources for the company.
• The company entered into a settlement agreement with the Italian Revenue Agency for the 2017-2021 audit periods. This settlement indicates a resolution of tax-related issues in Italy.
• Heightened risks related to data privacy and security laws, potential penalties, and compliance costs.
• Increased regulatory scrutiny and potential legal claims related to data privacy and security practices.
• Potential impact of technological innovations on trust and safety verification procedures and unintended consequences.