InterContinental Hotels Group (IHG), the owner of Holiday Inn, reported a slowdown in global revenue per available room (RevPAR) in the second quarter due to weakened travel demand in the U.S., its largest market. Economic uncertainties, including U.S. trade tariffs and geopolitical tensions, have impacted consumer confidence, threatening the post-pandemic recovery of the hospitality industry. IHG’s U.S. RevPAR declined by 0.9% in Q2, a sharp drop from the 3.5% growth seen in the first quarter.
CEO Elie Maalouf acknowledged short-term macroeconomic challenges but expressed confidence in meeting annual profit expectations. The company remains cautiously optimistic despite recession fears and tighter consumer spending. Meanwhile, competitors like Marriott lowered their full-year revenue guidance, while Hilton raised its 2025 profit forecast, reflecting mixed signals in the U.S. travel sector.
The slowdown extended to IHG’s Greater China market, where RevPAR fell 3% in Q2 due to sluggish domestic demand. Globally, RevPAR growth slowed to just 0.3%, compared to 3.2% a year earlier. Rising inflation and trade tensions have pressured cost-conscious travelers, but recent data suggests a potential rebound in bookings and consumer sentiment in July.
Despite near-term challenges, the hospitality industry is watching for signs of stabilization. While economic headwinds persist, companies like IHG are banking on improving travel trends in the second half of the year to offset earlier weaknesses. The sector’s recovery remains uneven, with regional variations shaping the outlook for major hotel operators.
