H World Group, the Shanghai-based hotel operator behind brands such as HanTing, JI Hotel, and Orange, posted a 10.8% year-over-year increase in second-quarter revenue to RMB7.1 billion (USD 1.1 billion). The growth was largely powered by its domestic China operations, while its international arm continued to weigh on overall performance.
Hotel turnover—a key industry metric reflecting total room sales—rose 13.2% year-over-year to RMB30.5 billion in the quarter. The H World China (HWC) segment saw turnover climb 15.3%, while H World International (HWI) posted a 9.4% decline, reflecting ongoing softness in overseas markets, particularly in Europe.
China leads, international lags
Revenue from HWC reached RMB5.9 billion, up 14.9% from the same period last year. The segment benefited from a 2.6% rise in blended average daily rate (ADR) and a 1.1% increase in revenue per available room (RevPAR), driven by product upgrades and revenue-management initiatives. In contrast, HWI revenue fell 5.8% to RMB1.3 billion, as the company continues to integrate its overseas portfolio, which includes brands like Steigenberger and IntercityHotel.
Manachised and franchised (M&F) revenue—a key indicator of asset-light growth—jumped 25.2% to RMB3.6 billion (USD 529 million). This underscores H World's strategic shift toward management and franchise models, reducing capital intensity while expanding its footprint.
Net income attributable to H World Group Limited came in at RMB1.6 billion (USD 232 million), up from RMB1.5 billion in the year-ago quarter and RMB817 million in the previous quarter. The sequential improvement reflects stronger seasonal demand and operational leverage.
Network expansion on track
H World opened 498 new hotels in China during the quarter, bringing its total pipeline to a record level. The company reaffirmed its full-year gross opening guidance of 2,200 to 2,300 hotels, a target that appears achievable given the current pace.
CEO Jin Hui commented: “During the second quarter, we delivered another quarter of RevPAR expansion. Our blended HWC ADR rose 2.6% year-on-year, fueling a 1.1% year-over-year lift in blended RevPAR. This performance was underpinned by ongoing product upgrades and a suite of revenue-management optimization initiatives. Meanwhile, our hotel network kept expanding at a solid pace, with 498 newly-opened hotels across China; and the number of hotels in our pipeline grew both year-over-year and quarter-over-quarter. We remain firmly on track to hit our full‑year gross opening guidance of 2,200‑2,300 hotels. Looking ahead, we will continue to pursue ‘brand-led’ high-quality hotel network expansion, backed by our H Rewards membership program and technology development.”
The company's focus on brand-led growth is part of a broader industry trend. As aging hotels in China become prime targets for conversions, H World's strategy of upgrading existing properties and leveraging its loyalty program is likely to resonate with franchisees and investors alike.
However, the international segment remains a drag. The 9.4% decline in HWI turnover suggests that recovery in Europe is slower than anticipated, possibly due to macroeconomic headwinds and changing travel patterns. H World has been cautious about expanding overseas, focusing instead on optimizing its existing international portfolio.
For travel professionals, H World's results offer a mixed picture: robust domestic demand in China, but persistent weakness in international markets. The company's ability to maintain RevPAR growth through pricing power and operational efficiency will be key to sustaining momentum.
Looking ahead, H World's pipeline of new hotels and its commitment to technology and membership engagement position it well for continued growth in China's competitive hospitality market. As Chinese outbound travel patterns shift, H World's domestic strength may partially offset softer international performance.
