Bengaluru — Hilton Worldwide lifted its 2025 profit forecast on expectations of a complete recovery in domestic travel demand in the US after a sharp pullback earlier this year.
But the company’s projection for third-quarter profit came in below analysts’ expectations, sending the hotel operator’s shares down over 2% in premarket trading.
Some travel companies, including Delta Air Lines and United Airlines, recently said US travel demand has steadied after a setback in March driven by President Donald Trump’s trade war.
“We believe the (US) economy... is set up for better growth over the intermediate term, which should accelerate travel demand,” said Hilton CEO Christopher Nassetta.
But international tourists from Canada and Europe have cut down US visits.
Hilton’s second-quarter US room revenue fell 1.5% compared to a year earlier.
The McLean, Virginia-based company expects third-quarter adjusted profit in the range of $1.98 to $2.04 per share, compared with Wall Street estimates of $2.13.
Bernstein analyst Richard Clarke also raised concerns about the company’s ability to meet its 6% to 7% projection for 2025 net unit growth, which refers to the number of rooms added to the company’s portfolio.
Hilton will need a record second half to meet even the low end of its full-year net unit growth forecast, prompting concerns of a potential downgrade, Clarke said.
The company forecast its full-year adjusted profit to be in the range of $7.83 and $8 per share, compared with its earlier forecast of $7.76 to $7.94.
The Waldorf Astoria-parent, which last week reopened its flagship hotel in New York after eight years of restoration, posted an adjusted profit of $2.20 per share in the second quarter, beating Wall Street estimates of $2.04, according to data compiled by LSEG.
Total revenue for the quarter ended June 30 was $3.14bn, up 6.3% from a year earlier.
Reuters
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