Huazhu Group Ltd
NASDAQ:HTHT
Huazhu Group Ltd
Huazhu Group Ltd., founded in 2005 by visionary entrepreneur Qi Ji, has blossomed into a formidable force within the hospitality industry, standing as one of China’s largest hotel operators. Initially inspired by the rising demand for budget-friendly accommodations among China's middle class, Huazhu carved its niche by offering a wide array of hotel brands, each tailored to distinct customer segments. From the economic Hanting Hotel to the more upscale Joya Hotel brand, the company effectively taps into a range of consumer preferences, ensuring that travelers from all walks of life find fitting comfort under its umbrella. By 2023, Huazhu had not only cemented its dominance in China with thousands of properties under its management but expanded its footprint internationally through strategic acquisitions and partnerships, notably with its acquisition of Deutsche Hospitality, a move that opened doors to the European market.
In terms of operations, Huazhu employs an asset-light model that focuses on franchise and lease-and-operate arrangements, allowing it to accelerate growth without heavy capital outlays typical of hotel ownership. This efficiency is reflected in its revenue streams that primarily flow from room bookings, complemented by membership programs that bolster customer loyalty and frequent engagement. The group's model is further supported by digital innovations, leveraging robust IT infrastructure to streamline operations, enhance customer experience, and collect data insights. By continuously refining its offerings and tapping into technological advancements, Huazhu not only secures its income through high occupancy rates and consistent pricing strategies but also positions itself as a dynamic leader ready to capitalize on shifting travel trends in the post-pandemic landscape.
Huazhu Group Ltd., founded in 2005 by visionary entrepreneur Qi Ji, has blossomed into a formidable force within the hospitality industry, standing as one of China’s largest hotel operators. Initially inspired by the rising demand for budget-friendly accommodations among China's middle class, Huazhu carved its niche by offering a wide array of hotel brands, each tailored to distinct customer segments. From the economic Hanting Hotel to the more upscale Joya Hotel brand, the company effectively taps into a range of consumer preferences, ensuring that travelers from all walks of life find fitting comfort under its umbrella. By 2023, Huazhu had not only cemented its dominance in China with thousands of properties under its management but expanded its footprint internationally through strategic acquisitions and partnerships, notably with its acquisition of Deutsche Hospitality, a move that opened doors to the European market.
In terms of operations, Huazhu employs an asset-light model that focuses on franchise and lease-and-operate arrangements, allowing it to accelerate growth without heavy capital outlays typical of hotel ownership. This efficiency is reflected in its revenue streams that primarily flow from room bookings, complemented by membership programs that bolster customer loyalty and frequent engagement. The group's model is further supported by digital innovations, leveraging robust IT infrastructure to streamline operations, enhance customer experience, and collect data insights. By continuously refining its offerings and tapping into technological advancements, Huazhu not only secures its income through high occupancy rates and consistent pricing strategies but also positions itself as a dynamic leader ready to capitalize on shifting travel trends in the post-pandemic landscape.
Revenue Beat: H World posted Q3 2025 group revenue of RMB 7 billion, up 8.1% YoY, surpassing the high end of prior guidance.
Strong Asset-Light Growth: Manachised and franchised (M&F) business revenue jumped 27.2% YoY to RMB 3.3 billion, with gross operating profit up 28.6% YoY.
Margin Expansion: Group adjusted EBITDA margin improved by 3.3 percentage points YoY to 36.1%, driven by the asset-light strategy and cost controls.
Network Expansion: Over 2,000 new hotels opened in the first 9 months; full-year openings expected to surpass 2,300, with a focus on quality growth.
Membership Milestone: H Rewards membership base surpassed 300 million, up 17.3% YoY, with members accounting for 74% of total room nights sold.
RevPAR Stabilization: RevPAR stayed largely stable YoY in Q3, with leisure demand offsetting business weakness; Q4 RevPAR expected to be flattish to slightly positive.
Q4 Guidance: Group revenue expected to grow 2–6% YoY (3–7% ex-DH), and M&F revenue expected to rise 17–21% YoY.
