Difficult times are coming in tourism

By: Trademagazin Date: 2024. 02. 23. 11:57

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Large companies interested in tourism are exasperating their shareholders with increasingly poor forecasts, as the travel fever in America has peaked at pre-pandemic levels, and there is only a narrow path leading up from here. Booking Holdings, one of the leading online travel companies, said in its latest release that the recovery in the travel industry has slowed and their share price has fallen sharply, reducing the company’s market value by $12 billion in a single trading day.

According to a recent report by Booking.com, the total value of reservations finalized on its platforms increased by 24 percent compared to the previous year, reaching 150.6 billion dollars. The company’s revenue growth was also favorable, rising 25 percent to $21.4 billion. Net profit after tax also increased, by 40 percent to 4.3 billion dollars.

However, investors were disappointed by Booking Holdings’ forecasts for the first quarter of the year, which showed only 5-7 percent overall booking volume growth, significantly below the previous year. The company owed its previous success to the boom in Asian travel, but the Hamas-Israeli war had a negative impact on them.

The Hilton and Marriott hotel chains also disappointed with weaker forecasts, indicating a slowdown in the tourism boom. Marriott expects only 3-5 percent growth in annual revenue per available room, compared to 15 percent last year. At Hilton, the 12.6 percent expansion in 2023 will be replaced by an increase of only 2-4 percent.