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Hilton’s Q3 Earnings Exceed Expectations, but Q4 Outlook Falls Short


Shares of Hilton Worldwide Holdings Inc. (HLT) experienced a 1.1% decline in premarket trading on Wednesday following the release of their third-quarter earnings report. While the hotel operator reported earnings that surpassed expectations, their outlook for the current quarter fell short. Despite this setback, Hilton remains optimistic as they anticipate a significant increase in hotel openings.

Strong Financial Performance

Hilton’s net income for the third quarter rose to $377 million, equivalent to $1.44 per share, compared to $347 million, or $1.26 per share, during the same period last year. Adjusted for nonrecurring items, their earnings per share reached $1.67, slightly above the FactSet consensus of $1.66. The company’s revenue also experienced healthy growth with a 12.9% increase to $2.67 billion, surpassing the FactSet consensus of $2.62 billion.

Impressive Revenue per Available Room

A key metric for the hotel industry, revenue per available room (RevPAR), saw a solid uptick of 6.8%. This growth brought the RevPAR figure to $121.37, exceeding the projected expectation of $120.30.

Unfavorable Outlook for Q4

Despite their strong performance in Q3, Hilton’s outlook for the fourth quarter was not as positive as expected. The company estimates an adjusted EPS range of $1.51 to $1.56, falling slightly behind the FactSet consensus of $1.56.

Positive Forecast for 2023

On a brighter note, Hilton raised their guidance ranges for adjusted EPS and RevPAR growth for the year 2023. The new range for adjusted EPS is between $6.04 and $6.09, up from the previous range of $5.93 and $6.06. Additionally, the expected RevPAR growth has been adjusted to between 12.0% and 12.5%, surpassing the earlier range of 10% to 12%.

Market Performance

Over the past three months, Hilton’s stock has experienced a 1% decline, while the S&P 500 has seen a 7% drop during the same period.

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