IHG revenue rises on Europe, Asia travel growth despite US decline

InterContinental Hotels Group reported stronger-than-expected global hotel revenue in the fourth quarter, supported by travel demand across Europe, the Middle East, and the Asia Pacific.

Growth in these regions helped offset continued weakness in the United States, where leisure travel has slowed as consumers rein in spending.

The company exceeded analyst expectations for global room revenue, highlighting how international markets are sustaining performance even as economic pressures affect travel patterns in its largest market.

The results reflect shifting global demand trends as hotel operators increasingly rely on regional diversification to maintain revenue stability and reduce reliance on slower domestic markets.

Global room revenue beats forecasts

IHG reported a 1.6% increase in global revenue per available room for the quarter ended December 31.

The performance indicates steady global travel demand, supported by strong activity across several international markets.

Revenue per available room remains a key industry metric, reflecting hotel occupancy and pricing trends across business and leisure segments.

The company, which operates brands including Holiday Inn and Avid Hotels, benefited from stronger trading conditions outside North America during the period.

IHG said it opened 65,1000 rooms during the period, up 10% on the year, across a record 443 hotels.

Europe and Asia drive growth

Europe, the Middle East, and the Asia Pacific played a central role in supporting overall performance.

Stronger travel demand across these regions helped counterbalance declining revenue in the US market.

International travel activity has remained resilient, helping hotel operators maintain revenue growth even as some markets face economic pressure.

These regions provided an important buffer against weakness in IHG’s largest market.

IHG’s global footprint has allowed it to capture travel demand across multiple regions, reducing dependence on any single market and strengthening revenue stability.

US market faces continued pressure

Revenue per available room in the US declined 2% in the fourth quarter.

This marked the third consecutive quarterly decline and followed a 1.6% drop in the previous quarter.

The decline reflects weaker leisure travel demand as cost-conscious consumers limit discretionary spending amid economic uncertainty.

Reduced travel activity has affected hotel occupancy levels and pricing power across the country.

IHG’s US performance also lagged behind competitors Hilton and Marriott, which recorded relatively stronger results in the same region during the quarter.

Demand to stabilise

IHG indicated that trading conditions in the US are expected to improve as travel demand strengthens and market conditions stabilise.

The company also expects growth in corporate travel budgets.

Industry expectations suggest less volatility ahead, which could support hotel performance and restore momentum in the region.

Chief executive Elie Maalouf said the company had delivered an "excellent" financial performance despite facing turbulent trading conditions.

"Our cash generation and strong balance sheet support our investments to drive growth, and we continue to sustainably increase our ordinary dividend as well as regularly return surplus capital through share buybacks," he said.

The company also announced it will start a share buyback program of upto $950 million.