InterContinental Hotels Group (IHG) reported a global RevPAR increase of 3.3% in the first quarter of 2025, driven by a 2.2% rise in Average Daily Rate (ADR) and a 0.6 percentage point increase in occupancy. All three demand drivers—Leisure, Business, and Groups—contributed positively, with comparable rooms revenue up 2%, 3%, and 5% respectively.
Regionally, the Americas saw RevPAR increase by 3.5% (U.S. also 3.5%), with occupancy up 0.7 percentage points and rate growing by 2.4%. The EMEAA region delivered strong growth with RevPAR up 5%, driven by a 4% rate increase and a 0.6 percentage point rise in occupancy. Greater China's RevPAR was down 3.5% due to strong comparatives and increased outbound leisure travel.
IHG opened 14,600 rooms across 86 hotels in Q1 2025, more than double the openings from the same period last year, contributing to 7.1% gross growth year-on-year and 4.3% net growth (5% excluding The Venetian removal). The company added nearly 26,000 rooms to its pipeline, pushing the total pipeline to over 300,000 rooms for the first time, representing a 9% increase year-over-year.
Management expressed confidence in meeting current full-year consensus profit expectations for 2025, with operating profit from reportable segments currently at $1.251 billion, implying an 11% growth on 2024 results. The adjusted EPS consensus of $4.97 suggests a 15% growth, partly due to an anticipated 130 basis points of fee margin expansion from ancillary fee streams.
The System Fund changes implemented in April 2025 are projected to add an estimated incremental $25 million to IHG's revenue and operating profit in 2024, doubling to $50 million in 2025. This, along with the acquisition of the Ruby Urban Lifestyle brand adding 30 hotels to the pipeline, underscores IHG's strategic initiatives to boost ancillary fee streams and expand fee margins.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.