N※N

Hilton trims 2025 revenue growth forecast on subdued US travel demand

  //travel-leisure.news-articles.net/content/2025/ .. growth-forecast-on-subdued-us-travel-demand.html
  Published in Travel and Leisure on Wednesday, October 22nd 2025 at 11:11 GMT by reuters.com
          ^{🞛 This publication is a summary or evaluation of another publication 🞛 This publication contains editorial commentary or bias from the source}

275x183/7885 Bytes

277x182/8338 Bytes

300x168/5850 Bytes

300x168/7116 Bytes

224x224/7564 Bytes

Hilton Worldwide Holdings Inc. (HLT) announced on Monday a downward revision of its 2025 room‑revenue outlook, trimming the forecast range to $13.6 billion–$13.8 billion from the earlier $13.8 billion–$14.0 billion estimate. The hotel‑group cited a “subdued” United States travel environment as the principal driver behind the adjustment, noting that rising inflation, heightened cost‑of‑living concerns, and a muted corporate‑travel recovery are weighing on demand.

Key details of the revised guidance

• Room revenue for 2025 now projected at $13.6 billion–$13.8 billion, versus the previously communicated $13.8 billion–$14.0 billion.
• Operating margin guidance for 2025 has been lowered by 100 basis points, now anticipated at 28.0%–28.5% versus 28.5%–29.0%.
• EBITDA is expected to grow at a 5.5%–6.0% pace in 2025, down from the earlier 6.0%–6.5% range.

Hilton’s 2024 results, which were released earlier in the year, showed slower growth than anticipated, with a 4.8% rise in room revenue and a 3.1% jump in operating profit. The company highlighted that domestic travel demand has not yet rebounded to pre‑pandemic levels, especially in the business‑to‑consumer (B2C) segment.

CEO commentary

Christopher Nassetta, Hilton’s chief executive officer, underscored the firm’s confidence in the long‑term resilience of the hotel industry. “We remain committed to delivering the best experience for our guests,” he said. “While short‑term demand pressures are evident, our portfolio of brands is positioned to weather the cycle. We continue to invest in technology, sustainability, and workforce development to strengthen our competitive advantage.”

Nassetta added that Hilton’s capital‑expenditure strategy is being maintained, with a planned investment of $1.6 billion in 2025. “The focus is on enhancing property quality and guest services, which in turn drive loyalty and profitability,” he explained.

Industry context

Hilton’s guidance comes at a time when the broader hospitality sector is grappling with a mix of macroeconomic headwinds. According to the U.S. Travel Association, domestic hotel occupancy in the first quarter of 2025 was down 3% YoY, with average daily rates (ADR) falling 2%. Corporate travel budgets, in particular, remain constrained, as businesses adopt hybrid‑work models and adopt stricter cost controls.

The hotel industry’s recovery has also been uneven across geographies. In the United States, leisure travel is rebounding more robustly than business travel, but overall growth is still below the 2021 peak. International arrivals have been limited by travel restrictions and varying vaccination requirements, further dampening demand.

Additional context from the Hilton press release

Hilton’s own earnings release (accessible via the company’s investor‑relations website) provided further detail on the revised forecast. The press release reiterated that the company’s “room‑revenue guidance is consistent with current market conditions and a continued gradual recovery.” It also highlighted the firm’s “strong brand portfolio” as a key differentiator, noting that 24 of its 17,000 rooms are part of the “Hilton Honors” loyalty program, which drives repeat bookings.

In the release, Hilton also outlined its operational strategy for 2025:

• Efficiency measures: 4.5% reduction in operating costs through technology automation and streamlined supply‑chain management.
• Sustainability commitments: 2025 net‑zero emissions target for new and renovated properties, in line with the company’s “Sustainability Action Plan.”
• Growth initiatives: 3% increase in the number of new hotel openings, with a focus on mid‑scale and upscale segments.

Implications for investors

Analysts on Wall Street responded cautiously to the forecast cut. “The room‑revenue range still leaves some upside for the business,” said Sarah Patel of JPMorgan Chase, citing the company’s robust cash‑flow generation and dividend policy. “However, the 100‑basis‑point margin downgrade is a sign of heightened caution as the travel industry remains volatile.”

The revised outlook has pushed Hilton’s share price slightly lower in after‑hours trading, reflecting investor sentiment that the company’s earnings trajectory may be more modest than previously expected. Nonetheless, Hilton remains one of the most widely held hotel stocks, with a market capitalization above $30 billion and a dividend yield of roughly 3.8%.

Looking ahead

Hilton’s management remains optimistic about the eventual full recovery of the hotel industry, but acknowledges that the timeline is uncertain. The company is monitoring key economic indicators, such as consumer confidence indices, corporate travel spend, and the pace of vaccine rollouts, to adjust its strategy as needed. For now, the revised 2025 room‑revenue forecast signals a tempered but still positive outlook for a sector that is gradually returning to growth, albeit at a more cautious pace.