H World Group (HTHT) Q4 2024 earnings summary

Executive summary

• Achieved milestone of over 10,000 hotels in 1,000+ cities/counties, with record 2,442 new hotel openings in 2024, driven by expansion in lower-tier cities and upper-midscale segment growth.

• Operated 11,147 hotels with 1,088,218 rooms as of December 31, 2024, with rapid network expansion in China and a growing asset-light model.

• Asset-light model transformation accelerated, with asset-light revenue exceeding 50% for Legacy business and 40% for the group.

• Membership base grew to nearly 270 million, with direct corporate bookings up 39% year-over-year.

• Strategic focus for 2025 includes further penetration into lower-tier cities, strengthening upper-midscale presence, and enhancing direct sales and membership engagement.

Financial highlights

• Group revenue rose 9.2% year-over-year to RMB23.9 billion in 2024; Q4 revenue up 7.8% to RMB6.0 billion.

• Adjusted EBITDA increased 8.8% year-over-year to RMB6.8 billion; core adjusted EBITDA up 13.9% to RMB7.5 billion.

• Adjusted net income grew 5.8% year-over-year to RMB3.7 billion; operational cash inflow reached RMB7.5 billion.

• Legacy-Huazhu revenue up 9.1% to RMB19.0 billion; Legacy-DH revenue up 9.6% to RMB4.9 billion.

• Net income attributable to H World was RMB3.0 billion for 2024, down from RMB4.1 billion YoY, mainly due to FX loss, DH restructuring, and higher withholding tax.

Outlook and guidance

• Group revenue expected to grow 2%-6% year-over-year in 2025, or 5%-9% excluding DH; managed and franchise revenue projected to grow 17%-21%.

• Plan to open around 2,300 hotels and close about 600 in 2025, targeting 15% network growth.

• Q1 2025 RevPAR expected to see a low single-digit decline year-over-year due to seasonality, but full-year RevPAR to stabilize or slightly increase.