Hilton's Q1 Earnings Surpass Estimates, Revenues Rise Y/Y

Hilton Worldwide Holdings Inc. HLT reported first-quarter 2025 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. Earnings surpassed the estimate for the sixth straight quarter.Hilton’s president and CEO, Christopher J. Nassetta, expressed satisfaction with its first-quarter performance, highlighting solid bottom-line results despite a softer macroeconomic environment. He emphasized confidence in Hilton’s ability to sustain strong net unit growth, driven by its top-tier brands and robust commercial strategy. Looking ahead, Nassetta said the company remains optimistic about its long-term growth prospects and is well-positioned to deliver continued value to stakeholders through 2025 and beyond.Hilton’s Q1 Results in DetailHilton reported adjusted earnings per share (EPS) of $1.72, which beat the Zacks Consensus Estimate of $1.61. In the year-ago quarter, it reported an adjusted EPS of $1.53. (See the Zacks Earnings Calendar to stay ahead of market-making news.)Total revenues of $2,695 million missed the consensus mark of $2.707 million, but grew 4.7% on a year-over-year basis.Hilton Worldwide Holdings Inc. Price, Consensus and EPS Surprise Hilton Worldwide Holdings Inc. price-consensus-eps-surprise-chart | Hilton Worldwide Holdings Inc. QuoteThe quarter’s franchise and licensing fees improved year over year to $625 million from $571 million. Our estimate for the metric was $624.3 million.Base and other management fees declined year over year to $88 million from $106 million, while incentive management fees were up 2.9% to $72 million. Our model projected base and other management and incentive management fees to be $80.2 million and $58.6 million, respectively.Ownership revenues were $234 million compared with the year-ago quarter’s level of $255 million. We expected the metric to be $266.1 million.HLT’s RevPAR and Adjusted EBITDAIn the quarter, the system-wide comparable RevPAR grew 2.5% year over year (on a currency-neutral basis), owing to an increase in occupancy and ADR.Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $795 million, up 6% year over year. Our estimate for adjusted EBITDA was $789.2 million.Balance Sheet of HLTAs of March 31, 2025, Hilton’s total cash and cash equivalents were $807 million compared with $1.376 billion as of Dec. 31, 2024. As of the first quarter, the long-term debt outstanding (including current maturities) was $11.15 billion, almost flat compared with Dec. 31, 2024.In first-quarter 2025, the company repurchased 3.7 million of its common stock for $242.92 per share. It paid dividends worth $37 million during the quarter.Management declared a quarterly cash dividend of 15 cents per share, which will be payable on June 27, 2025, to its shareholders of record as of May 23.Hilton’s Business UpdatesIn the first quarter of 2025, Hilton added 186 hotels, comprising 20,100 rooms and achieved net room growth of 14,000. The company continued to expand its portfolio of lifestyle brands, including the introduction of Tempo by Hilton in the United Kingdom, the brand’s first location outside the United States, along with the debut of Tapestry Collection by Hilton and Curio Collection by Hilton in Athens, Greece, and the launch of Canopy by Hilton in Utah, marking the brand’s entry into ski destinations.Hilton also expanded its luxury footprint in April with the openings of Waldorf Astoria Osaka and Waldorf Astoria Costa Rica Punta Cacique.As of March 31, 2025, Hilton's development pipeline comprised 3,600 hotels representing 503,400 rooms across 123 countries and territories, including 27 countries and territories where it had no existing hotels. For 2025, HLT expects net unit growth to be in the range of 6-7%.HLT Q2 & 2025 OutlookFor second-quarter 2025, Hilton anticipates net income to be in the range of $455-$469 million compared with $421 million reported in the year-ago quarter. Adjusted EBITDA is expected to be between $940 million and $960 million compared with $917 million reported a year ago. It predicts adjusted EPS between $1.97 and $2.02, up from $1.91 reported in last year’s quarter.For the second quarter of 2025, management forecasts system-wide RevPAR (on a currency-neutral basis) to increase in the band of 2.5-3.5% on a year-over-year basis.For 2025, HLT estimates net income to be in the range of $1.829-$1.858 billion. Adjusted EBITDA is expected to be between $3.7 billion and $3.74 billion. It predicts general and administrative expenses to be in the range of $420-$430 million.Full-year adjusted EPS is projected to be in the range of $7.76-$7.94 compared with the prior estimate of $7.71-$7.82. The capital return is anticipated to be about $3.3 billion.Management anticipates 2025 system-wide RevPAR (on a currency-neutral basis) to be flat to up 2% year over year.HLT’s Zacks Rank & Key PicksHilton currently has a Zacks Rank #3 (Hold).Some better-ranked stocks from the Zacks Consumer-Discretionary sector are TEGNA Inc. TGNA, Life Time Group Holdings, Inc. LTH and American Outdoor Brands, Inc. AOUT.TEGNA presently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. TEGNA delivered a trailing four-quarter earnings surprise of 6.3%, on average. The stock has gained 19.6% in the past year. The consensus estimate for TEGNA’s 2026 sales and EPS implies growth of 11.3% and 93.8%, respectively, from the year-ago levels. Life Time Group presently sports a Zacks Rank #1. The company delivered a trailing four-quarter earnings surprise of 21.6%, on average. The stock has surged 128.6% in the past year. The consensus estimate for Life Time Group’s 2025 sales and EPS implies growth of 12.9% and 37.9%, respectively, from the year-ago levels. American Outdoor carries a Zacks Rank #2 (Buy) at present. The company delivered a trailing four-quarter earnings surprise of 79.6%, on average. The stock has gained 42.7% in the past year. The Zacks Consensus Estimate for American Outdoor’s fiscal 2025 sales and EPS indicates growth of 3.7% and 93.8%, respectively, from the year-ago levels.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Hilton Worldwide Holdings Inc. (HLT): Free Stock Analysis Report TEGNA Inc. (TGNA): Free Stock Analysis Report American Outdoor Brands, Inc. (AOUT): Free Stock Analysis Report Life Time Group Holdings, Inc. (LTH): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks