financetom
Economy
financetom
/
Economy
/
Travel companies rein in their forecasts as US consumers cut spending
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Travel companies rein in their forecasts as US consumers cut spending
Aug 8, 2024 3:20 AM

NEW YORK (Reuters) - Travel companies including Airbnb and Marriott International ( MAR ) are forecasting a slowdown in leisure travel as U.S. consumers wait longer to book vacations in a time when the economic outlook remains uncertain. 

After several years in which robust demand padded the industry's bottom line while regions in other parts of the world were still recovering from the pandemic, travel companies have warned investors that U.S. bookings in the third quarter will be flat.

"They have less available, less disposable income and (less) capacity to do anything including travel," Hilton Worldwide ( HLT ) CEO Christopher Nassetta told analysts on an earnings call on Wednesday. 

The company said it expects growth in all travel segments but cautioned that growth in leisure travel will be "very, very low." 

Hilton Worldwide ( HLT ) raised its profit forecast for 2024 as international revenue offset losses from slowing U.S. demand.

Other companies are feeling the effects as well, from Delta Air Lines and United Airlines to Walt Disney, which flagged weakness in its parks division in its quarterly results on Wednesday. 

Hilton peer Marriott ( MAR ) lowered its forecast for growth in room revenue in 2024, in part due to softer demand in North America. Leisure room revenue in the region grew just 1% in its most recent quarter.

Vacation rental company Airbnb ( ABNB ) and online travel agency Booking Holdings ( BKNG ) both said they are seeing slowing growth in the United States. Some consumers are trading down for lower-priced options while others are booking trips at the last minute, which is another signal of weakening demand. 

"We're not seeing as many people book all of their vacations at the beginning of the calendar year any longer," said Julie Brinkman, chief executive of short-term rental management platform Beyond. "They're now waiting until they get closer to the travel date, and can confirm that they have the funds to actually take a trip." 

Airbnb ( ABNB ) shares closed 13.4% lower on Wednesday at $113, their lowest close since May 26, 2023. Shares of Booking Holdings ( BKNG ) closed 3.3% lower on Wednesday. The company said room night bookings in the second quarter grew more slowly in the United States than in the rest of the world.

"As we look ahead to the third quarter, we believe room night growth will be impacted by a booking window that expands less than it did in the second quarter," said Glenn Fogel, Booking Holdings' ( BKNG ) CEO. 

Investors will get another look at trends in leisure travel on Thursday when online travel agency Expedia Group ( EXPE ) reports second-quarter earnings after the bell. 

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
US Dollar Falls Early Tuesday Ahead of Redbook, Factory Orders, JOLTS, Fed Speakers
US Dollar Falls Early Tuesday Ahead of Redbook, Factory Orders, JOLTS, Fed Speakers
Apr 2, 2024
07:51 AM EDT, 04/02/2024 (MT Newswires) -- The US dollar fell against its major trading partners early Tuesday, except for an increase against the yen, ahead of a busy day of economic data releases and appearances by Federal Reserve officials. The dollar got a boost from an unexpected increase in the ISM's manufacturing index for March on Monday morning that...
US factory orders increase solidly in February
US factory orders increase solidly in February
Apr 2, 2024
WASHINGTON (Reuters) - New orders for U.S.-manufactured goods rebounded more than expected in February, boosted by demand for machinery and commercial aircraft as manufacturing regains its footing. Factory orders increased 1.4% after dropping 3.8% in January, the Commerce Department's Census Bureau said on Tuesday. Economists polled by Reuters had forecast orders rebounding 1.0%. They rose 1.0% year-on-year in February. Manufacturing,...
US job openings little changed in February; quits edge up
US job openings little changed in February; quits edge up
Apr 2, 2024
WASHINGTON (Reuters) - U.S. job openings held steady at higher levels in February, while the number of people quitting their jobs rose marginally. Job openings, a measure of labor demand, edged up 8,000 to 8.756 million on the last day of February, the Labor Department's Bureau of Labor Statistics said in its monthly Job Openings and Labor Turnover Survey, or...
Bitcoin Drops Over 5% as Upbeat U.S. Factory Data Powers Dollar Index to Nearly 5-Month High
Bitcoin Drops Over 5% as Upbeat U.S. Factory Data Powers Dollar Index to Nearly 5-Month High
Apr 1, 2024
Bitcoin fell below $66,500 during the Asian hours as the dollar index rose above 105.00 for the first time since mid-November.Data released on Monday shows that U.S. manufacturing activity unexpectedly picked up the pace in March.June Fed rate cut probability dipped below 50% after the manufacturing data.Bitcoin {{BTC}} faced selling pressure during Asian trading hours on Tuesday as upbeat U.S....
Copyright 2023-2025 - www.financetom.com All Rights Reserved