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Hilton sees 2025 profit below estimates on weak leisure travel demand
February 06, 2025 04:35 PM IST | By EODHD
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(Reuters) - Hotel operator Hilton Worldwide forecast 2025 profit below Wall Street estimates on Thursday, weighed down by weak leisure travel demand in the U.S. While wealthy Americans are taking advantage of a strong dollar and traveling abroad, low- to middle-income people are grappling with increasing costs and have cut back on discretionary expenses like vacations. The McLean, Virginia-based company expects 2025 adjusted profit between $7.71 and $7.82 per share, compared with analysts' average estimate of $8.02 per share, according to data compiled by LSEG. It expects systemwide revenue per available room (RevPAR) to increase between 2% and 3% from a year earlier, and net unit growth of about 6% to 7%. Hilton's RevPAR grew 3.5% for the fourth quarter, while occupancy remained fairly steady at 69.9%, up 110 basis points from a year earlier. RevPAR in the U.S., the company's biggest market in terms of hotel rooms, came in at $114.18, up 2.9% from a year earlier, but down nearly 10.7% on a sequential basis. Quarterly RevPAR in Asia-Pacific rose 1.7% as travel demand in China remains muted, but the region is now showing signs of recovery after contracting 3.4% in the third quarter. Hilton's development pipeline during the quarter grew 8% to 498,600 rooms. Incentive management fees came in at $86 million, up 11.7% from a year earlier. The company posted a fourth-quarter profit of $1.76 per share, compared with analysts' average estimate of $1.68. It reported a total revenue of $2.78 billion, roughly in-line with expectations of $2.77 billion. (This story has been corrected to say that incentive management fees rose 11.7% from a year ago, not fell 10.5%, in paragraph 8) (Reporting by Aishwarya Jain; Editing by Shinjini Ganguli) View Comments