U.S. travel firms brace for split second-quarter earnings outlook

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US travel split earnings outlook

Highlights

Hotel operators are set to report strong Q2 results due to resilient demand and elevated pricing driven by the FIFA World Cup, but may need to raise full-year guidance.
Online travel firms, including Booking Holdings, face headwinds from Middle East geopolitical risks and AI adoption, prompting BTIG to expect softer full-year outlooks.
Airbnb stands out as the prime online travel beneficiary of the World Cup, thanks to increased supply initiatives directly targeting event-driven demand spikes.

World Cup demand shapes earnings expectations

As reported by Reuters, hotel operators are expected to benefit from resilient travel demand and firm hotel and airfare pricing tied to the FIFA World Cup, while online travel companies such as Booking Holdings are likely to offer more cautious forecasts.

Analysts at BofA Global Research say hotels are the clearest winners from the event, but they also note that operators may need to lift full-year guidance to sustain momentum in the sector. Jefferies says strong domestic demand and premium pricing, especially in luxury and upper-upscale segments, are set to support solid second-quarter hotel results even as Middle East revenue softens.

Even so, some industry executives question how durable the boost is. Bookit CEO Lin Dai tells Reuters that any improvement in host-market hotel earnings is a short-lived effect rather than a lasting demand trend, adding that higher revenue reflects pricier rooms more than a meaningful rise in traveler volumes.

Online platforms face geopolitical and technology pressures

Brokerage BTIG expects softer forecasts from online travel firms because of uncertainty linked to tensions in the Middle East, where cancellations peak in March and April. The firm says that risk weighs most heavily on Booking Holdings, whose full-year guidance had assumed the U.S.-Israeli war on Iran would end by June 30.

Analysts also say online travel stocks are increasingly affected by concerns that AI agents such as ChatGPT and Gemini could take over parts of the booking process. Windsor Drake managing director Jeff Barrington says Expedia's core search, comparison and aggregation role is especially exposed to that shift.

Airbnb is viewed as an exception within the online travel segment. Bernstein analyst Richard Clarke says Airbnb is likely the biggest World Cup beneficiary among online platforms because of its push to add supply around the event.

Hilton Worldwide is scheduled to report on July 28, followed by Marriott International on August 3, Booking Holdings on August 4, Expedia Group on August 5 and Airbnb on August 6. Baird analyst Michael Bellisario says the key issue for investors is the underlying growth trend beyond any temporary World Cup effect.

Our earlier analysis of Booking Holdings (BKNG) highlighted a bearish technical setup alongside weakening institutional sentiment after a major shareholder sharply reduced its stake. We noted the stock was trading below key moving averages, with downside risk concentrated around the $165.4–$175.1 range and $175.82 flagged as a key level to reclaim for any meaningful rebound.

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