US hotel profits grow despite dip in demand

Revenue from hotel food and beverage operations helped to drive U.S. hotel profitability in October

Fewer room nights were booked at U.S. hotels in October than in September, but total hotel revenues and profits increased month to month and year over year. One explanation for that is that the demand for hotel rooms in October was predominantly driven by groups and events, and those guests tend to spend more on hotel food and beverage.

Key takeaways

• October was another month of weak demand for hotels in the U.S. Room nights sold dropped 1.2% year-over-year, making October’s performance the weakest since April;
• Food-and-beverage revenues per occupied room reached a new record at $82.99 in October 2023 an increase of 9.2% year over year. This has been the highest level of revenue per occupied room since October 2018;
• Luxury and upper-upscale hotels in the U.S. reported the highest group demand since October 2018. Upper-upscale chains continue to lead the growth in revenues and profits, with more than 16% GOPPAR growth through October year to date.

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