Hilton Worldwide's first-quarter business transient revenue per available room increased 2.7 percent year over year in what CEO Christopher Nassetta on a Tuesday earnings call described as a four-point step up in demand from the fourth quarter of 2025, driven by strengthening midweek demand across all chain scales.
The quarter's performance delivered on the optimism Nassetta expressed in recent quarters that corporate travel volume would improve. Group RevPAR, too, grew 4.3 percent year over year in the quarter, bolstered by growth in company meeting and convention demand.
Nassetta said Hilton continues to see "healthy underlying momentum for group" supported by corporate volume.
"We're seeing real lead volumes and bookings in line with the forecasting we have," he said. "Atmospherically, the discussions our sales folks are having broadly about sentiment in that space, and the corporate space for that matter, are much better. … I think people are feeling better, they're spending more, they need to move more, they need to aggregate people more, and we're seeing it show up."
First-quarter systemwide comparable RevPAR increased 3.6 percent year over year, fueled by growth across all chain scales, brands and segments.
Hilton updated its full-year 2026 RevPAR outlook to 2 percent to 3 percent growth year over year, up from the 1 percent to 2 percent growth projected in its fourth-quarter earnings update. Its second-quarter RevPAR growth outlook also is 2 percent to 3 percent year over year.
In recent quarters, luxury and upper-upscale have outperformed other segments across the global hotel industry. Nassetta said he expects to see a shift in 2026 "with RevPAR strength continuing to move downstream from luxury and upper upscale toward a more balanced convergence demand shape," particularly in the United States. He cited what he described as a more relaxed regulatory environment, business-friendly tax policy and a surge in private investment around AI, data centers and infrastructure as factors that he projected would improve hotel performance in the midmarket.
Middle East Impact
RevPAR for Hilton's Middle East and Africa region declined 1.7 percent year over year "as strong early-quarter performance was offset by weakness following travel disruptions from the conflict across the Middle East," according to CFO Kevin Jacobs. The region's occupancy declined 4.1 percentage points year over year during the quarter to 64.3 percent.
The Middle East represents 3 percent of Hilton's overall portfolio. Jacobs said Hilton expects RevPAR in the region to be down in the "mid-to-high teens" for the full year and for the largest impact to be seen in the second quarter.
Hilton's Q1 Metrics
Hilton's first-quarter systemwide occupancy stood at 67.4 percent, up 1.4 percentage points from the prior year. Average daily rate rose 1.5 percent to $157.14.
In the U.S., RevPAR increased 3.4 percent year over year to $115.40. Occupancy increased 1.3 percentage points to 68.7 percent and ADR grew 1.4 percent to $168.08.
For the first quarter, total revenue rose 9 percent year over year to $2.9 billion.
Hilton's development pipeline as of March 31 included about 527,000 rooms, up 5 percent from the prior year. Net unit growth was about 6.3 percent.
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