Hilton Beats Expectations on Heavy Demand for U.S. Vacations

(Bloomberg) -- Hilton Worldwide Holdings Inc. reported better-than-expected results for the second quarter, as travelers made up for lost vacations.

• The company reported adjusted earnings per share of 56 cents, according to a statement Thursday, beating the average analyst estimate of 39 cents. Its shares surged as much as 4.2%, the biggest intraday jump in more than five months.

Key Insights

• U.S. Room demand continued to improve in July even as Covid-cases spiked, Chief Executive Officer Christopher Nassetta said on a conference call with investors. With occupancy rates rising, labor availability remains a key issue, Nassetta said.
• Still, the spread of the highly transmissible delta variant is threatening the travel rebound. Hilton is seeing a slower recovery in parts of the world with lower vaccination rates. Occupancy rates were 64% in the U.S., compared to 56% in Asia and 32% in Europe.

Market Reaction

• Hilton shares jumped to $134.99 on Thursday in New York. The stock had gained 16% this year through Wednesday’s close, compared with a 2% gain for the Bloomberg Americas Lodging Index.

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