Topline
This week, major hotel chains Hilton, Hyatt, and Wyndham revised their annual forecasts downward, pointing to a difficult overall economic climate and weakening consumer spending. These adjustments reflect worries that travelers may be postponing vacations as the summer travel season draws near.
Key Facts
On Thursday, both Hyatt Hotels and Wyndham Hotels & Resorts revised their forecasts for annual room revenue downwards by multiple percentage points.
During his company’s first-quarter earnings call, Hyatt CEO Mark Hoplamazien informed investors that “the short-term outlook has been affected” with reservations decreasing by “a figure in the high single digits compared to last year, particularly in recent weeks.”
Wyndham CEO Geoff Ballotti told Wall Street analysts “consumer sentiment resulting from the macro uncertainty” was weighing on the leisure segment.
On Tuesday, Hilton revised its 2025 room revenue growth projection to 0% to 2%, a decrease from their earlier estimate of 2% to 3%.
Marriott and Choice Hotels report their first-quarter earnings next week.
The Dow Jones U.S. Hotel Index is down 14% in the past three months.
Key Background
Consumer confidence
plummeted in April
to pandemic-level lows, which has Americans pulling back discretionary spending on items like vacations. Big data on credit card spending indicates that President Donald Trump’s tariff announcement on April 2 was an inflection point. Year-over-year growth in U.S. hotel sales fell by about 9%—from growing at a rate of about 3% at the end of March to shrinking by 6% by mid-April, according to an analysis of over 110 million anonymized credit and debit cards by
Consumer Edge
, a source for consumer expenditure information. This “significant change might indicate that people are beginning to delay travel reservations,” Michael Gunther, Vice President and head of insights at Consumer Edge, mentioned to .
What We Don’t Know
As to whether consumer confidence might drop before the busy summer travel season. “Although spending increased consistently from January through March following typical seasonal trends, this upward trend seems to stall in April, which could signal concern for both hotels and overall consumer behavior,” Gunther stated, suggesting that travelers may delay their vacations pending greater clarity regarding the economy. During Hilton’s first-quarter earnings conference, CEO Christopher Nassetta mentioned that weaker conditions persist into the second quarter.
Big Number
In 2024, U.S. hotel visitors shelled out $747 billion, as reported by the American Hotel and Lodging Association.
Tangent
Leading U.S. airlines were among the first to raise concerns that demand for travel is weakening. Almost all of the major carriers have signaled this trend.
Delta
,
American
, Southwest, Alaska and JetBlue—has withdrawn its full-year outlook, while
United
offered two forecasts—one if there is a recession and a second if the economy stabilizes.
Further Reading
Hotel Stocks Hit By Tariff Turndown
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Americans Are Pulling Back On Travel Spending In 2025, New Data Shows
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