Airbnb’s stock on Thursday fell more than 4% after the company reported its second-quarter earnings. The company beat Wall Street’s expectations for revenue and bookings but warned about expected volatility from the Covid delta variant.

Here’s how the company did:

• Earnings: Loss of 11 cents per share
• Revenue: $1.34 billion vs. $1.26 billion forecast by Refinitiv

The company reported 83.1 million nights and experiences booked, up 29% from the first quarter and up a whopping 197% year over year after the travel industry collapsed a year ago amid the Covid-19 pandemic. Analysts polled by StreetAccount had expected 79.2 million nights and experiences booked.

Revenue came in at $1.34 billion, up nearly 300% year over year.

Airbnb’s sales and marketing expenses for the second quarter were up 175% year over year, reaching $315 million. The company attributed the rise in marketing expenses to its Made Possible by Hosts campaign. Airbnb had warned in February that it expected its sales and marketing expenses as a percentage of revenue in the first half of 2021 to be higher than that of the second half.

Gross booking value, Airbnb’s way of tracking host earnings, service fees, cleaning fees and taxes, totaled $13.4 billion, up 320% year over year and above the $11.56 billion FactSet consensus.

Airbnb’s net loss narrowed to $68 million for the quarter, down more than 88% from a net loss of $575.6 million a year prior.

Its average daily rate rose to $161, up from $160 in the prior quarter, reflecting an increase in the amount customers are spending for homes and experiences. That figure was up 41% year over year.

In its letter to shareholders, the company warned that it is bracing for volatility as a result of the Covid-19 delta variant. Airbnb said it expects delta to affect travel behavior, specifically in regard to how often and when guests book and cancel.

The company said that although it expects the third quarter to deliver its strongest quarterly revenue on record, it expects Q3 nights and experiences booked to be below that of Q2 and Q3 2019.

“As we exit Q2 and come into Q3, we have a combination of fewer bookings for the fall, just given the nature of some of the seasonality, and any kind of impact potentially on Covid concerns,” Airbnb CFO Dave Stephenson said on a call with analysts. 

Airbnb said vaccination progress and containment of new variants will be variables that impact how the company performs in the fourth quarter.

“We do not yet know how willing people will be to travel in the fall as compared to summer,” the company said in its shareholder letter.