Short-term home rental company Airbnb said on Wednesday it filed confidentially for an initial public offering with US regulators, setting the stage for one of 2020’s marquee stock market debuts.

The move underscores a rebound in parts of the travel industry, which was battered this year by restrictions and shutdowns due to the Covid-19 pandemic.

San Francisco-based Airbnb said in July that customers had booked more than a million nights in a single day for the first time since 3 March, in part as US travellers shy away from hotels and prefer to drive to local holiday rentals.

Shares of US online travel agency Booking Holdings have rebounded around 14% in the past three months but are still down for the year.

Companies can confidentially submit an IPO registration with the US Securities and Exchange Commission. If Airbnb moves forward with the IPO, the filing would be made public closer to the time of the listing.

The number of shares Airbnb will sell and the valuation it will seek have not yet been determined, Airbnb said in a statement. It did not give a timeline for when it may complete its IPO. The company is targeting a listing before the end of the year, according to a person familiar with the matter, cautioning this is dependent on market conditions.

Job cuts

The collapse of Airbnb’s core home-rental business due to the Covid-19 pandemic had prompted Airbnb to suspend marketing activities for the year and cut about 25% of its workforce. The company in April also raised US$2-billion in debt from investors, which valued it at $18-billion, well below the $26-billion Airbnb cited as an internal valuation in early March.

“The company may be thinking that the lost value they’ve realised in 2020 could be recouped as a public company and that will be reflected in the upside in their stock price,” said Andrea Walne, general partner at Manhattan Venture Partners, an Airbnb investor.

Airbnb’s decision to go public came as US capital markets stage a stunning recovery, with the likes of online used car seller Vroom and business intelligence platform ZoomInfo Technologies seeing their shares surge after going public.

“We believe that investors are willing to look beyond Covid issues and value companies based upon post-Covid scenarios. It’s a constructive IPO market,” said Kathleen Smith, principal at Renaissance Capital, a provider of institutional research and IPO ETFs.