H World 4Q25 First Take: Overall, Q4 sustained the strong Q3 momentum, with revenue beating the top end of guidance. On profitability, a higher franchise mix and digital-driven efficiency lifted core OP well above market expectations.
1) Revenue: total revenue rose 8.3% YoY, exceeding the prior 2%–6% guide and showing a modest QoQ acceleration. From an expectations lens, the market already anticipated rapid franchise growth, so self-operated hotels were the key driver of the revenue beat. Dolphin Research believes Tier-1 business activity recovered, with higher ADR pushing RevPAR up sharply.
2) Profit: with franchise revenue mix up materially vs. last year, GPM expanded by 950bps. Q4 saw a tactical push to raise mid-to-upscale brand exposure via social media seeding and ads, lifting the sales expense ratio.
However, the rising franchise mix drove a sharp decline in the management expense ratio, and Adj. EBITDA came in well above market expectations.
3) Guidance: for 2026, the company guided revenue growth of 2%–6%. Franchise revenue is expected to grow 12%–16%, a step-down vs. 2025, but new openings are still brisk at 2,200–2,300. $HWORLD-S(01179.HK) $H World(HTHT.US)
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