12:28 PM EDT, 08/07/2024 (MT Newswires) -- Airbnb's ( ABNB ) Q2 earnings performance was "tough" due to slower demand and increased marketing expenses, RBC Capital Markets said in a note Wednesday.

"We believe the company is facing a textbook multiple compression situation driven by higher marketing spend into slowing demand," RBC said in the note.

Airbnb ( ABNB ) on Tuesday posted Q2 earnings of $0.86 per share on revenue of $2.75 billion. Analysts polled by Capital IQ expected EPS of $0.91 on revenue of $2.74 billion.

Management's focus on "product cycle opportunities as a way to reignite growth was constructive" and a significant opportunity could exist, RBC said. However, the "marketing to counter deceleration" tactic led to a lowering of estimates, the brokerage said.

RBC cut its price target on Airbnb's ( ABNB ) stock to $120 from $150 and maintained sector perform rating.

Airbnb ( ABNB ) shares were down by nearly 13% in recent trading.

Price: 113.24, Change: -17.23, Percent Change: -13.21