Hilton hotel group lifts profit forecast as US travel demand recovers
But the company's projection for third-quarter profit came in below analysts' expectations, sending the hotel operator's shares down more than 2% on Wednesday.
Some travel companies, including Delta Airlines and United Airlines, recently said US travel demand had 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 and, when paired with low industry supply growth, unlock stronger revenue per available room," said Hilton chief executive Christopher Nassetta.
'On the development side, we achieved the largest pipeline in our history, and we remain confident in our ability to deliver net unit growth between 6% and 7% for the next several years,' he added.
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. However, total revenue for the quarter ended June 30 was $3.14bn (€2.69bn), up 6.3% from a year earlier..
Hilton operates 15 hotels in Ireland including the Montenotte Hotel and the Ballymaloe House Hotel — both of which are in Cork.
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, Mr 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.
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