H World Group Achieves Strong Q2 Performance with Innovative Asset-light Strategy

In a significant financial update, H World Group Limited, operating on NASDAQ under the ticker HTHT, revealed its solid second-quarter results for 2025, showcasing a remarkable 22.8% year-on-year increase in asset-light revenues. This growth is a testament to the company's effective execution of its asset-light strategy, which has strengthened its market position and operational efficiency. Setting the stage for future expansion, H World Group is making significant strides in the hospitality sector.

Impressive Financial Highlights

During the second quarter, the company's hotel turnover surged by 15.0% year-on-year, reaching RMB 26.9 billion. This achievement is accompanied by a solid adjusted EBITDA increase of 11.3% to RMB 2.3 billion. The H World Group continues to demonstrate its commitment to transparency, with a clear distinction drawn between its manachised and franchised hotels and its leased and owned establishments for the first time.

The manachise and franchise segment alone reported a gross operating profit of RMB 1.9 billion, reflecting a notable 23.2% increase from the previous year. This segment now accounts for 64% of the group's total gross operating profit, a leap from 57% during the same period last year. Jin Hui, the CEO of H World Group, remarked on the sustained growth trajectory, stating, "Despite a slight decline in year-over-year RevPAR, our asset-light strategy has spurred significant operating profit growth, supported by our network expansion."

Expanding Network and Brand Presence

As H World Group celebrates its 20th anniversary, it proudly operates over 12,137 hotels worldwide, translating to more than 1.18 million hotel rooms as of June 30. This expansion includes its flagship brand, Hanting Hotel, which has been ranked as the number one hotel brand by HOTELS Magazine, boasting 4,401 locations. Notably, Orange Hotel has also reached a significant milestone with over 1,000 operational hotels.

The company is making strides in the upper-midscale market with more than 1,500 hotels in operation across China. Notably, InterCity Hotel has emerged as a key player in this segment, marking a 57.1% increase year-on-year, underscoring the growing demand for higher-end hotel offerings.

Customer Engagement and Digital Transformation

Customer loyalty remains one of H World Group's strong suits, with membership in its loyalty program reaching an impressive 288 million as of June 30 this year. Additionally, direct bookings through the company's central reservation system accounted for 65.1% of total reservations, marking a 5.2 percentage point rise compared to the previous year. This shift reflects a successful pivot towards enhanced digital engagement strategies.

Outlook for Future Growth

Looking ahead, H World Group remains optimistic about the long-term growth prospects of China's travel and hospitality sectors. Jin Hui emphasized the company's commitment to building essential competencies, enhancing the quality of its global network, improving supply chain operations, and bolstering brand positioning alongside delivering exceptional service.

In a display of confidence, the Board of Directors declared a substantial cash dividend of approximately US$250 million for the first half of 2025, adhering to its dedication to shareholder returns. This amounts to a dividend of US$0.081 per ordinary share or US$0.81 per American Depositary Share.

As H World Group pushes forward with ambitious plans, including the opening of 595 new hotels in the quarter, it is steadily on its way to meet its target of 2,300 gross openings for the full year of 2025. The company's innovative strategies and commitment to excellence position it well for sustained growth and market leadership in the hospitality industry.

For additional details, visit their official site: H World Group.