IHG reports forecast-beating Q3 revenue per available room; shares slip

InterContinental Hotels Group (IHG) reported a Q3 revenue per available room (RevPAR) growth of 5.3%, exceeding the consensus forecast of 4.4%, although its shares dipped by 3% early on London trading. IHG, which operates brands such as Holiday Inn and voco, experienced an acceleration in RevPAR growth from 4.6% year-to-date to 5.3% in Q3, fueled by strong performance in the Americas region, where RevPAR surged by 6.8% and occupancy rose by 2.1 percentage points to 73.9%.

Conversely, RevPAR in Greater China decreased by 3.3% due to weather events and alterations in public holiday schedules affecting demand. EMEAA demonstrated an improvement with a 5.0% RevPAR growth. IHG has expressed confidence in meeting the consensus expectations for fiscal 2026, aiming for adjusted EPS around the upper end of its growth algorithm target of 12-15% annually on average over the medium to long term.

Elie Maalouf, Chief Executive Officer, attributed the Q3 RevPAR growth acceleration to IHG's geographic, brand, and stay occasion breadth, which captured growing guest demand worldwide. The company opened 289 hotels so far this year, adding 44,400 rooms, and signed 516 hotels totaling 70,300 rooms. IHG now operates 1.06 million rooms across 7,186 hotels, marking a 4.9% year-over-year net system growth.

By customer segment, third-quarter rooms revenue on a comparable hotels basis increased by 10% for Groups, 5% for Leisure, and 4% for Business. Average daily rate climbed by 3.9% with occupancy rising by 0.9 percentage points. IHG has finalized $707 million of its $950 million share buyback program, decreasing the share count by 3.1%.

With approximately $285 million in dividend payments, IHG is on track to return over $1.2 billion to shareholders in 2026.