(Reuters) – Hotel operator Hilton Worldwide said on Wednesday it forecast 2024 profit below expectations due to signs of slowing demand for leisure travel in the United States.
On the New York Stock Exchange, the stock fell almost 3% in electronic transactions before the opening.
While Hilton and other hotel groups have benefited from the strong recovery in travel after the COVID-19 pandemic, the growing appetite for other forms of tourism, such as cruises, as well as high room rates, are weighing on hotel demand in the United States.
“We recorded another year of strong results, both in terms of revenue and bottom line, and we continued to execute on our development strategy,” said Christopher Nassetta, chief executive officer of Hilton.
Hilton, owner of brands including Waldorf Astoria Hotels & Resorts, said its revenue per available room, or RevPAR, a key industry metric, rose 5.7% in the fourth quarter from a year earlier, to reach 107.69 dollars.
The company forecast full-year adjusted earnings of between $6.80 and $6.94 per share, compared with analysts’ expectations of $7.07 per share, according to LSEG data.
Hilton forecasts net profit of between 1.69 and 1.72 billion dollars (1.57 and 1.60 billion euros) in 2024.
Competitor Marriott International is due to report results next week.
(Reporting by Aishwarya Jain and Doyinsola Oladipo in New York; Diana Mandiá, editing by Blandine Hénault)
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