On October 25, 2023, Hilton Worldwide Holdings Inc (HLT, Financial) released its third-quarter earnings report for 2023. The company reported strong results, exceeding expectations for system-wide RevPAR growth and leveraging its industry-leading portfolio of brands to drive further growth of its global network.
Financial Highlights
The company reported a diluted EPS of $1.44 for the third quarter, with an adjusted EPS of $1.67. The net income for the quarter was $379 million, and the adjusted EBITDA was $834 million. System-wide comparable RevPAR increased by 6.8% on a currency-neutral basis compared to the same period in 2022. The company also approved 35,500 new rooms for development during the third quarter, bringing Hilton's development pipeline to a record 457,300 rooms as of September 30, 2023.
Development and Expansion
Hilton added 15,700 rooms to its system in the third quarter, resulting in 14,300 net additional rooms in Hilton's system during the period. The company also expanded its brand portfolio of open hotels, with the openings of the first Spark by Hilton and the first Tempo by Hilton during the third quarter.
Share Repurchase and Dividends
The company repurchased 4.5 million shares of Hilton common stock during the third quarter, bringing total capital return, including dividends, to $723 million for the quarter and $1,938 million year to date through October.
Outlook
For the full year 2023, Hilton expects system-wide RevPAR to increase between 12.0% and 12.5% on a comparable and currency-neutral basis compared to 2022. Full year net income is projected to be between $1,375 million and $1,389 million, and full year Adjusted EBITDA is projected to be between $3,025 million and $3,045 million.
Commentary
Christopher J. Nassetta, President & Chief Executive Officer of Hilton, commented on the results:
We continued to see strong results during the third quarter, exceeding our expectations for system-wide RevPAR growth, with growth across all customer segments. We also continue to leverage our industry-leading portfolio of brands to drive further growth of our global network. We believe we have hit an inflection point and expect a meaningful uptick in openings in the fourth quarter with continued positive momentum into next year. With a record number of approvals year-to-date driving the largest pipeline in our history, we are confident in our ability to accelerate net unit growth to 5.5 percent to 6.0 percent next year."
