H World International Makes Profit as Cost Cuts Meet Stronger Demand

H World International reported its first profitable year since H World Group bought Deutsche Hospitality in 2019.

The international hotel business made about €63 million ($73.7 million) in adjusted EBITDA in 2025, compared with a loss of about €19 million ($22.2 million) a year earlier. Its portfolio includes 118 hotels under brands such as Steigenberger, IntercityHotel, Zleep, MAXX, and House of Beats.

Better hotel trading helped the turnaround

The company’s hotels performed better in 2025. Hotel turnover rose 8.5 percent for the year and 13.7 percent in the fourth quarter. Average daily rate reached €120 ($140.4) in the fourth quarter, up from €115 ($134.55) a year earlier. Occupancy also improved to 72.6 percent from 70.5 percent.

H World International also changed how it manages different hotel brands. Steigenberger, its upscale brand, is focused on higher room rates and stronger positioning.

Select-service hotels follow a different model. They need high occupancy, competitive pricing, and tight cost control because guests in that segment are usually more price-sensitive.

Cost cuts and lease changes remain central

The profit improvement was not only about stronger demand. H World International also made difficult internal changes. It exited around 16 loss-making hotels, cut more than 200 central roles, and renegotiated several leases. These steps helped reduce pressure from hotels and overhead costs that were holding back the business.

H World wants to use Chinese scale in Europe

The next opportunity is to connect the European business more closely with H World’s much larger Chinese platform. At the end of 2025, H World operated 12,858 hotels and more than 1.26 million rooms worldwide.

For H World International, this scale could lower costs and improve operations. Buying supplies or hotel equipment through a group with more than 12,000 hotels is very different from buying for only 118 hotels.

H World’s parent company shows the path forward

H World Group ended 2025 with stronger profit and asset-light growth, showing how the parent company is using franchising, management contracts, and scale to expand more efficiently. The international business is now trying to follow the same logic: reduce lease pressure, improve brand performance, and use H World’s larger platform to make its European portfolio more profitable.

Photo by Mike Swigunski on Unsplash