Bullish Hoplamazian talks AI, 2026 pace, more

CHICAGO – As Hyatt Hotels Corp. moves further toward its stated goal of becoming a predominantly asset light business model, it reported third quarter earnings last week that reflected strength within its luxury-biased portfolio. While leisure transient RevPAR increased 1.6% year-over-year, 3Q25 RevPAR was up 6% across luxury brands with net package RevPAR growth across its high-end all-inclusive business up 7.6%.

Hyatt President and CEO Mark Hoplamazian also stated they have three more hotels under contract for sale and an additional three with signed letters of intent. Hyatt expects all six hotels to close in the early part of 2026, keeping it on track to exceed a 90% asset light earnings mix in the near term.

During the earnings call, Hoplamazian was particularly insightful about Hyatt’s cost-saving initiatives, which he said includes a bigger goal of moving toward an insight-led and brand-focused organization.

“That sounds like corporate speak, but it’s real in the sense that we are going deep on being able to understand the different customer groups that we serve across our portfolio, and they are different,” Hoplamazian said. “How we get to them through distribution channels and marketing are different, as well.”

I think there’s a lot of tailwind into economic activity in the United States as we look forward. Part of that, I think, is anticipated, and maybe driving some of the group pace that we see into next year.

Mark Hoplamazian

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Hoplamazian further explained that Hyatt has divided its business into five brand groups, which is how they will operate the business moving forward.

He added that this is happening concurrently with a significant elevation of “practicing agile ways of working,” which has been a work in progress for four years. “It is designed to test and learn, experiment and innovate more quickly,” Hoplamazian said.

A third element related to business transformation and cost savings, Hoplamazian continued, is the use artificial intelligence – expanded use of machine learning and models. “We have built several agentic platforms already internally,” he said. “Some have been solely focused on driving top lines; some have been really focused on cost efficiency; they’re all focused on driving performance, including providing a platform that our hotel teams can use to maximize performance of their hotels, which has a direct impact on owners.”

With the AI platform, Hoplamazian said there are already direct, measurable impacts on the business.

Bigger picture, Hoplamazian said they changed the organization of the company and found tremendous levels of efficiency in how they’re staffed. “Some will be also in third-party costs because we are automating a significant number of functions and processes at a fraction of the cost of paying third parties to do it for you,” he said. “We’ve just scratched the surface. We are leaning into this very heavily, and you will see this as a tailwind for us for years to come.”

2026 tailwinds

When asked about his confidence in next year’s RevPAR environment reaccelerating, Hoplamazian first pointed to the potential tailwinds of the World Cup and the America 250 celebrations.

He also said the infrastructure bill continues to pace and hyperscalers are moving from planning stage to construction phase in their data center constructions with the minimum size of investment in those projects at $5 billion.

“There’s a tremendous level of activity in terms of mobilization of resources to lean into the data requirements of AI of the future,” Hoplamazian said. “So, I think there’s a lot of tailwind into economic activity in the United States as we look forward. Part of that, I think, is anticipated, and maybe driving some of the group pace that we see into next year.”

He added that leisure demand continues to be very strong with October showing the U.S. up 3%  and international up 7%. “This is not abating... We’re seeing it in all of our numbers and, yes, we do serve a different customer base. So, I’m not making any comments about the midscale and below. I am making a comment about us.”

Performance, pipeline

Other highlights of the earnings call included:

Performance. Overall, in the United States, RevPAR declined 1.6% year-over-year, matching expectations. Soft select-service leisure transient demand was the main culprit. The fourth quarter is off to a good start with October RevPAR increasing in the U.S. by approximately 1% and globally by 5%.

Homeinns Hotel Group plans to open 50 Hyatt Studios branded hotels in China.

Business transient RevPAR was flat in 3Q25, but Hyatt saw a 3% year-over-year improvement in the U.S. with select-service delivering positive quarterly growth for the first time in 2025.

Group pace for the fourth quarter is up approximately 3% as Hyatt laps easier comparisons. Hoplamazian said they are encouraged by the forward-looking booking trends with group pace for full-service U.S. hotels up in the high single digits and expected to benefit for special events like the World Cup and America 250 celebrations.

Pace for all-inclusive resorts in the Americas, excluding Jamaica, is up over 10% for the first quarter of next year, reflecting the continued prioritization of leisure travel.

Pipeline. Hyatt achieved net rooms growth of over 12% during the quarter, or 7% when excluding acquisitions. It ended the quarter with a development pipeline of approximately 141,000 rooms, an increase of more than 4% to last year. Upper midscale brands now represent 13% of its pipeline, up from 10% at the end of 2024 and more than half of Hyatt Select, Hyatt Studios and Unscripted by Hyatt opportunities are in markets where they currently have no brand representation.

Hoplamazian added that organic growth is extremely strong with Hyatt on track to more than double its core organic growth rate year-over-year.