HYATT REPORTS FIRST QUARTER 2025 RESULTS
Hyatt Hotels Corporation today reported first quarter 2025 results. |
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HYATT REPORTS FIRST QUARTER 2025 RESULTS
Hyatt Hotels Corporation today reported first quarter 2025 results. |
Category: Worldwide - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2025-05-02
Highlights include:
- Comparable system-wide hotels RevPAR increased 5.7%, compared to the first quarter of 2024
- Net rooms growth was 10.5%
- Net income attributable to Hyatt Hotels Corporation was $20 million and Adjusted Net Income was $46 million
- Diluted EPS was $0.19 and Adjusted Diluted EPS was $0.46
- Gross fees were $307 million, an increase of 16.9%, compared to the first quarter of 2024
- Adjusted EBITDA was $273 million, an increase of 5.4%, or an increase of 24.4% after adjusting for assets sold in 2024, compared to the first quarter of 2024
- Pipeline of executed management or franchise contracts was approximately 138,000 rooms
- Repurchased approximately 1.1 million shares of Class A common stock for an aggregate purchase price of $149 million
- Full Year 2025 Outlook:
- Comparable system-wide hotels RevPAR growth is projected between 1% to 3%, compared to the full year 2024
- Net rooms growth is projected between 6% to 7%, compared to the full year 2024
- Net income is projected between $95 million and $150 million
- Adjusted EBITDA is projected between $1,080 million and $1,135 million, an increase of 6% to 12% after adjusting for assets sold in 2024, compared to the full year 2024
- Adjusted Free Cash Flow is projected between $450 million and $500 million, excluding approximately $117 million of cash taxes on asset sales and approximately $43 million of costs associated with the Playa Hotels Acquisition
Mark S. Hoplamazian, President and Chief Executive Officer of Hyatt, said, "In the face of growing volatility in the economy and financial markets, we continue to deliver strong performance, highlighted by our first quarter results. As we look ahead, recent shifts in booking behavior—particularly in shorter-term demand—have led us to modestly revise our outlook for the remainder of the year. That said, we remain confident in the resilience of our asset-light business model, the strength of our brand portfolio, and our ability to adapt to evolving market conditions. We are excited about the momentum in our pipeline and the continued strong demand we're seeing for our brands around the world."
First Quarter Operational Commentary
- Business transient and group travel drove system-wide and United States RevPAR growth. The quarter was impacted by Easter, which took place in the second quarter, whereas the holiday fell in the first quarter last year.
- Gross fee growth of 17% in the quarter with properties from the Bahia Principe and Standard International Transactions contributing approximately $17 million, or 38%, of the total gross fee growth.
- Base management fees: increased 16%, driven by managed hotel RevPAR growth and the contribution of newly-opened hotels.
- Incentive management fees: grew 18%, led by newly-opened hotels, Americas all-inclusive resorts, favorable FX, and international hotels, notably in Asia Pacific (excluding Greater China).
- Franchise and other fees: expanded 17%, due to non-RevPAR fee contributions, RevPAR growth in the United States, and newly-opened hotels.
- Owned and leased segment Adjusted EBITDA grew 18% after adjusting for assets sold in 2024, compared to the first quarter of 2024. Comparable owned and leased margin increased by 70 bps in the first quarter compared to the same period in 2024.
- Excluding the impact of the UVC Transaction, distribution segment results improved by 10%, compared to the first quarter of 2024, from higher pricing, effective cost management, and favorable foreign currency exchange despite lower booking volumes in the quarter.
Openings and Development
During the first quarter, the Company:
- Opened 11,253 rooms, including:
- The first Hyatt Studios property, Hyatt Studios Mobile / Tillmans Corner.
- The Venetian Resort Las Vegas, with 7,092 rooms, which became available through Hyatt booking channels in January; these rooms were not included in the 2024 year end pipeline figures.
- Other notable openings; Andaz Doha, Hotel La Compañia del Valle, part of The Unbound Collection by Hyatt, and seven UrCove properties.
- Announced a new brand, Hyatt Select, an upper midscale, transient conversion brand designed to meet the needs of modern travelers while delivering an efficient, cost-effective model for owners.
Transactions
The Company has provided the following updates on the planned Playa Hotels Acquisition:
- Continues to advance discussions for the sale of Playa's real estate and expects to be in a position to enter into an agreement to sell that real estate in the near future.
- Announced on April 28, 2025 the extension of the tender offer period to 5:00 p.m., New York City time on May 23, 2025.
- Issued $500 million of 5.050% senior notes due 2028 and $500 million of 5.750% senior notes due 2032, and received approximately $990 million of net proceeds. The Company intends to use the net proceeds to finance a portion of the Playa Hotels Acquisition.
- Entered into a credit agreement with a syndicate of lenders on April 11, 2025 for a $1.7 billion delayed draw term loan facility whereby proceeds will be used to finance the remaining portion of the Playa Hotels Acquisition.
Balance Sheet and Liquidity
As of March 31, 2025, the Company reported the following:
- Total debt of $4.3 billion.
- Total liquidity of $3.3 billion, inclusive of:
- $1,805 million of cash and cash equivalents, and short-term investments, and
- $1,497 million of borrowing capacity under Hyatt's revolving credit facility, net of letters of credit outstanding.
- Total remaining share repurchase authorization of $822 million. During the first quarter, the Company repurchased a total of 1,078,511 shares of Class A common stock for approximately $149 million.
- During the first quarter, the Company repaid the outstanding $450 million of 5.375% senior notes due 2025 at maturity for approximately $460 million, inclusive of $10 million of accrued interest.
The Company's board of directors has declared a cash dividend of $0.15 per share for the second quarter of 2025. The dividend is payable on June 11, 2025 to Class A and Class B stockholders of record as of May 29, 2025.
2025 Outlook
The Company is providing the following updated outlook for the 2025 fiscal year:
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2025 Outlook |
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vs. 2024 |
| System-Wide Hotels RevPAR Growth |
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|
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1% to 3% |
| Net Rooms Growth |
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|
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6% to 7% |
| (in millions) |
|
|
|
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| Net Income |
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$95 - $150 |
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(93)% to (88)% |
| Gross Fees |
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$1,185 - $1,215 |
|
8% to 11% |
| Adjusted G&A Expenses1 |
|
$450 - $460 |
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1% to 4% |
| Adjusted EBITDA1 |
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$1,080 - $1,135 |
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6% to 12%2 |
| Capital Expenditures |
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Approx. $150 |
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Approx. (12)% |
| Adjusted Free Cash Flow1 |
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$450 - $500 |
|
(17)% to (7)% |
1 Refer to the tables on schedule A-10 for a reconciliation of estimated net income attributable to Hyatt Hotels Corporation to Adjusted EBITDA, G&A expenses to Adjusted G&A Expenses, and net cash provided by operating activities to Free Cash Flow and Adjusted Free Cash Flow.
2 Adjusted EBITDA outlook growth excludes the $80 million contribution from sold assets in 2024. Refer to the tables on schedule A-9 for further details.
- Our outlook for system-wide RevPAR implies balance of year growth of 0% at the low end of our range and 2% at the high end of our range, and reflects a continuation of booking trends seen during the past four weeks.
- Net income outlook projected year over year decline is driven by 2024 gains on sale of real estate that are not expected to repeat at the same levels in 2025.
- Adjusted EBITDA outlook is projected between $1,080 million - $1,135 million, growing between 6% to 12% compared to the full year 2024 after adjusting for assets sold in 2024.
- Adjusted Free Cash Flow growth compared to full year 2024 is impacted by elevated levels of interest expense and cash taxes.
- While the Company is not providing an outlook for capital returns to shareholders at this time due to the planned Playa Hotels Acquisition, Hyatt remains committed to its capital allocation strategy including returning capital to shareholders through a combination of quarterly dividends and share repurchases.
No disposition or acquisition activity beyond what has been completed as of the date of this release has been included in the 2025 Outlook. Our 2025 Outlook does not account for the planned Playa Hotels Acquisition, however, our Adjusted Free Cash Flow excludes certain costs associated with the Playa Hotels Acquisition. The Company's 2025 Outlook is based on a number of assumptions that are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company's expectations may change. There can be no assurance that Hyatt will achieve these results.
Refer to the table on schedule A-8 for a summary of special items impacting Adjusted Net Income and Adjusted Diluted EPS for the three months ended March 31, 2025.
Note: All RevPAR and ADR growth percentage changes are in constant dollars. All Net Package RevPAR and Net Package ADR growth percentage changes are in reported dollars. This release includes references to non-GAAP financial measures. Refer to the non-GAAP reconciliations included in the schedules and the definitions of the non-GAAP measures presented beginning on schedule A-6.
Non-GAAP Financial Measures
The Company refers to certain financial measures that are not recognized under U.S. generally accepted accounting principles (GAAP) in this press release, including: Adjusted Net Income; Adjusted Diluted EPS; Adjusted EBITDA; Adjusted G&A Expenses; Free Cash Flow; and Adjusted Free Cash Flow. See the schedules to this earnings release, including the "Definitions" section, for additional information and reconciliations of such non-GAAP financial measures.
About Hyatt Hotels Corporation
Hyatt Hotels Corporation, headquartered in Chicago, is a leading global hospitality company guided by its purpose – to care for people so they can be their best. As of March 31, 2025, the Company's portfolio included more than 1,450 hotels and all-inclusive properties in 79 countries across six continents. The Company's offering includes brands in the Luxury Portfolio, including Park Hyatt, Alila, Miraval, Impression by Secrets, and The Unbound Collection by Hyatt; the Lifestyle Portfolio, including Andaz, Thompson Hotels, The Standard, Dream Hotels, The StandardX, Breathless Resorts & Spas, JdV by Hyatt, Bunkhouse Hotels, and Me and All Hotels; the Inclusive Collection, including Zoëtry Wellness & Spa Resorts, Hyatt Ziva, Hyatt Zilara, Secrets Resorts & Spas, Dreams Resorts & Spas, Hyatt Vivid Hotels & Resorts, Sunscape Resorts & Spas, Alua Hotels & Resorts, and Bahia Principe Hotels & Resorts; the Classics Portfolio, including Grand Hyatt, Hyatt Regency, Destination by Hyatt, Hyatt Centric, Hyatt Vacation Club, and Hyatt; and the Essentials Portfolio, including Caption by Hyatt, Hyatt Place, Hyatt House, Hyatt Studios, Hyatt Select, and UrCove. Subsidiaries of the Company operate the World of Hyatt loyalty program, ALG Vacations, Mr & Mrs Smith, Unlimited Vacation Club, Amstar DMC destination management services, and Trisept Solutions technology services.
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