Hilton Worldwide Holdings Inc. reported a systemwide comparable RevPAR increase of 1.4%, on a currency-neutral basis, for the third quarter compared to the same period in 2023. Net income was $344 million for the period.
“We were pleased to deliver continued strong bottom line results that exceeded our guidance, despite slower top-line growth which was driven by modestly slower macro trends, weather impacts and unfavorable calendar shifts,” said Christopher J. Nassetta, president/CEO, Hilton. “We continued to demonstrate the strength of our model, opening more rooms than any other quarter in our history, surpassing 8,000 hotels and achieving net unit growth of 7.8%.”
Third-quarter highlights include:
- Adjusted EBITDA was $904 million.
- Diluted EPS was $1.38 and diluted EPS, adjusted for special items, was $1.92.
- Approved 27,500 new rooms for development during the quarter, bringing the development pipeline to 492,400 rooms as of Sept. 30, representing growth of 8% from Sept. 30, 2023
- Added a record 36,600 rooms to the system in the quarter, resulting in 33,600 net additional rooms, contributing to a record net-unit growth of 7.8% from Sept. 30, 2023
- Repurchased 3.3 million shares of Hilton common stock during the quarter; bringing total capital return, including dividends, to $764 million for the quarter and $2.422 billion year-to-date through October
- Issued $1.0 billion aggregate principal amount of 5.875% Senior Notes due 2033 in September Full-year 2024 systemwide RevPAR is projected to increase between 2% and 2.5% on a comparable and currency-neutral basis compared to 2023; full-year net income is projected to be between $1.405 billion and $1.429 billion; full-year adjusted EBITDA is projected to be between $3.375 billion and $3.405 billion
- Full-year 2024 capital return is projected to be approximately $3.0 billion
- Net unit growth for 2025 is expected to be between 6% and 7%
Overview
For the three months ended Sept. 30, systemwide comparable RevPAR increased 1.4% compared to the same period in 2023 due to increases in both occupancy and ADR, and management and franchise fee revenues increased 8.3% compared to the same period in 2023.
For the nine months ended Sept. 30, 2024, systemwide comparable RevPAR increased 2.4% compared to the same period in 2023 due to increases in both occupancy and ADR, and management and franchise fee revenues increased 10.7% compared to the same period in 2023.
For the three months ended Sept. 30, 2024, diluted EPS was $1.38 and diluted EPS, adjusted for special items, was $1.92 compared to $1.44 and $1.67, respectively, for the three months ended Sept. 30, 2023. Net income and adjusted EBITDA were $344 million and $904 million, respectively, for the three months ended Sept. 30, compared to $379 million and $834 million, respectively, for the year-ago three-month period.
For the nine months ended Sept. 30, diluted EPS was $4.09 and diluted EPS, adjusted for special items, was $5.36 compared to $3.74 and $4.53, respectively, for the nine months ended Sept. 30, 2023. Net income and adjusted EBITDA were $1.034 billion and $2.571 billion, respectively, for the nine months ended Sept. 30, compared to $1.001 billion and $2.286 billion, respectively, for the nine months ended Sept. 30, 2023.
Development
In the third quarter, Hilton opened 531 hotels, totaling 36,600 rooms, resulting in 33,600 net room additions. During the quarter, NoMad, Graduate by Hilton and Small Luxury Hotels of the World became available for reservations on Hilton’s booking channels. The addition of SLH hotels brings the hotel portfolio to 10 additional countries and territories. The company continued to expand its portfolio in the Asia-Pacific market, surpassing 900 hotels in the region and opening the 700th hotel in China. Additionally, the Spark by Hilton brand continues to grow, with more than 20 hotels opening during the third quarter, including the debut of the first Spark hotel in Canada.
The company added 27,500 rooms to the development pipeline during the third quarter, and, as of Sept. 30, the development pipeline totaled 3,525 hotels representing 492,400 rooms throughout 120 countries and territories, including 28 countries and territories where Hilton had no existing hotels. Additionally, of the rooms in the development pipeline, 235,400 were under construction and 280,700 were located outside of the U.S.
Outlook
Full-year 2024
- Systemwide comparable RevPAR, on a currency neutral basis, is projected to increase between 2% and 2.5% compared to 2023.
- Diluted EPS is projected to be between $5.58 and $5.68.
- Diluted EPS, adjusted for special items, is projected to be between $6.93 and $7.03.
- Net income is projected to be between $1.405 billion and $1.429 billion.
- Adjusted EBITDA is projected to be between $3.375 billion and $3.405 billion.
- Contract acquisition costs and capital expenditures, excluding amounts reimbursed by third parties, are projected to be between $200 million and $250 million.
- Capital return is projected to be approximately $3 billion.
- General and administrative expenses are projected to be between $415 million and $430 million.
- Net unit growth is projected to be between 7% and 7.5%.
Fourth-quarter 2024
- Systemwide comparable RevPAR, on a currency neutral basis, is projected to increase between 1% and 2% compared to the fourth quarter of 2023.
- Diluted EPS is projected to be between $1.49 and $1.59.
- Diluted EPS, adjusted for special items, is projected to be between $1.57 and $1.67.
- Net income is projected to be between $371 million and $395 million.
- Adjusted EBITDA is projected to be between $804 million and $834 million.
