H World Group Reports Robust Q2 Results, Driven by Asset-light Strategy

Rhea-AI Summary

H World Group (NASDAQ: HTHT) reported strong Q2 2025 results, with hotel turnover increasing 15.0% year-over-year to RMB 26.9 billion. The company's asset-light strategy drove a 22.8% rise in asset-light revenues, with manachise and franchise hotels contributing 64% of total gross operating profit.

Key highlights include: total adjusted EBITDA growth of 11.3% to RMB 2.3 billion, addition of 595 new hotels in Q2, and expansion to 12,137 total hotels globally. The company's loyalty program reached 288 million members, with direct bookings accounting for 65.1% of reservations.

The Board declared a cash dividend of US$0.81 per ADS, totaling approximately US$250 million for H1 2025. The company maintains its target of 2,300 gross hotel openings for full-year 2025.

Positive

• Asset-light revenues increased 22.8% year-over-year
• Manachise and franchise gross operating profit grew 23.2% to RMB 1.9 billion
• Total adjusted EBITDA rose 11.3% to RMB 2.3 billion
• Direct bookings increased by 5.2 percentage points to 65.1%
• Declared cash dividend of US$250 million for H1 2025
• On track to achieve 2,300 gross hotel openings target for 2025

Negative

• Modest year-over-year RevPAR decline reported in Q2

Insights

Hospitality Financial Analyst

H World's asset-light strategy delivers strong Q2 growth with 22.8% YoY rise in asset-light revenues despite RevPAR decline.

H World Group has delivered an impressive quarter that validates its strategic pivot toward an asset-light business model. The 22.8% year-over-year increase in asset-light revenues alongside the 23.2% jump in manachise and franchise gross operating profit demonstrates that this transition is gaining significant momentum. Most telling is that manachise and franchise hotels now account for 64% of total gross operating profit, up from 57% in the prior year—a clear indication that the higher-margin segments are increasingly driving the company's financial performance.

The company's hotel turnover growth of RMB 26.9 billion (+15.0% year-over-year) and adjusted EBITDA increase to RMB 2.3 billion (+11.3%) illustrate healthy overall expansion despite management's acknowledgment of a modest RevPAR decline. This suggests H World is effectively compensating for softness in same-store performance through aggressive network expansion, having added 595 hotels in Q2 alone. With 2,947 hotels in the development pipeline globally, this growth trajectory appears sustainable.

The increased transparency in financial reporting—specifically separating results between asset-light and owned properties—signals management's confidence in the asset-light strategy and should enable investors to better evaluate the company's transformation. Meanwhile, the 5.2 percentage point increase in direct bookings (now 65.1% of reservations) reflects strengthening customer relationships and reduced dependence on third-party distribution channels, which typically improve margins. The declared dividend of US$250 million ($0.81 per ADS) further demonstrates management's confidence in the company's financial health and commitment to shareholder returns.

SINGAPORE and SHANGHAI, Aug. 20, 2025 /PRNewswire/ -- H World Group Limited (NASDAQ: HTHT) (HK: 01179), one of the world's leading hospitality groups, delivered robust second-quarter results for 2025, including a 22.8% year-on-year rise in asset-light revenues. Growth in hotel GMV, loyalty engagement, and network expansion further demonstrated the company's robust momentum and effective execution of its strategy.

Continuous Asset-light Push Yields Strong Results

Hotel turnover^[1] increased 15.0% year-over-year to RMB 26.9 billion in the second quarter of 2025. Total adjusted EBITDA rose 11.3% y-o-y to RMB 2.3 billion.

In line with its commitment to transparency and focus on an asset-light strategy, H World Group has, for the first time, separated results between its manachised and franchised hotels and its leased and owned hotels. Manachise and franchise gross operating profit reached RMB 1.9 billion in the second quarter of 2025, a 23.2% increase from the prior year. Manachise and franchise hotels accounted for 64% of total gross operating profit in that quarter, compared with 57% in the prior year.

Jin Hui, CEO of H World, says, "Supported by our asset-light strategy, we delivered robust operating profit growth in the second quarter, driven by network expansion, despite a modest year-over-year RevPAR decline. On the development front, we opened another 595 hotels in the quarter, well on track to achieve our 2,300 gross opening target for the full year of 2025."

Expanding Scale, Loyalty, and Brand Leadership

H World Group, celebrating its 20^th anniversary this year, operates a total of 12,137 hotels or 1,184,915 hotel rooms globally as of June 30.

One of the Group's flagship brands, Hanting Hotel, was ranked No. 1 by HOTELS Magazine's "World's Top 50 Hotel Brands" list, with 4,401 hotels or 378,569 rooms in operation. Orange Hotel also reached a milestone, surpassing 1,000 hotels in operation.

The Group accelerated its presence in the upper-midscale market in Q2 2025, with more than 1,500 hotels in operation and pipeline across China. InterCity Hotel drove the segment's performance, delivering a 57.1% year-on-year increase, reflecting strong demand for higher-end offerings. Alongside the achievements of Hanting and Orange, this underscores the appeal of the Group's strong and diverse brand portfolio to guests and partners alike.

Customer loyalty and direct engagement continued to strengthen, with membership reaching 288 million as of June 30. Direct bookings through H World CRS accounted for 65.1% of total reservations, representing a 5.2 percentage point increase from the prior year, reflecting the effectiveness of the Group's digital platforms.

Optimistic on Growth Momentum

As of June 30, H World had a total of 2,947 hotels in the development pipeline globally.

"We are positive on the long-term growth for China's travel and hospitality industry. We will continue focusing on building our own core competencies, expanding our high-quality network, upgrading our supply chain, enhancing our brand positioning and 'service excellence', and strengthening our sales capabilities." Jin Hui said.

For the first half of 2025, the Company's Board of Directors has declared a cash dividend of approximately US$250 million, reflecting its continued commitment to delivering shareholder returns. The dividend amounts to US$0.081 per ordinary share, or US$0.81 per American Depositary Share (ADS).

For the full release please visit:
(https://ir.hworld.com/news-releases/news-release-details/h-world-group-limited-reports-second-quarter-and-interim-2025)

About H World Group Limited

Originated in China, H World Group Limited (NASDAQ:HTHT) (HK:01179) is a key player in the global hotel industry. H World's brands include HanTing Hotel, JI Hotel, Crystal Orange Hotel, Steigenberger Hotels & Resorts, MAXX, Jaz in the City, IntercityHotel, Zleep Hotels and Steigenberger Icons. In addition, H World also has the rights as master franchisee for Mercure, Ibis and Ibis Styles, and co-development rights for Grand Mercure and Novotel, in the pan-China region.

For more information, please visit H World's website: https://ir.hworld.com

H World undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

For media inquiry, please contact:

Lihuan Wang media@hworld.com
Zheming Xing zheming@taskforce-china.cn
Zhibin Lang  zhibin.lang@taskforce-china.cn

¹Hotel turnover refers to total transaction value of room and non-room revenue from H World hotels (i.e., leased and operated, manachised and franchised hotels).

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SOURCE H World Group

FAQ

What were H World Group's (HTHT) key financial results for Q2 2025?

H World reported hotel turnover growth of 15.0% to RMB 26.9 billion, total adjusted EBITDA increase of 11.3% to RMB 2.3 billion, and asset-light revenues growth of 22.8% year-over-year.

How many hotels does H World Group (HTHT) operate as of Q2 2025?

H World Group operates 12,137 hotels with 1,184,915 hotel rooms globally as of June 30, 2025, with an additional 2,947 hotels in the development pipeline.

What dividend did H World Group (HTHT) declare for H1 2025?

H World Group declared a cash dividend of US$0.81 per ADS (US$0.081 per ordinary share), totaling approximately US$250 million for the first half of 2025.

How many loyalty program members does H World Group (HTHT) have?

H World Group's loyalty program reached 288 million members as of June 30, 2025, with direct bookings through their CRS accounting for 65.1% of total reservations.

What is H World Group's (HTHT) hotel opening target for 2025?

H World Group aims to achieve 2,300 gross hotel openings for the full year of 2025, having already opened 595 hotels in Q2 2025.