Hotel Earnings: 7 Things We Learned From Companies in the Skift Travel 200

Hotel earnings season has ended, so Skift reviewed what executives at hotel companies belonging to the Skift Travel 200 (ST200) said. We looked at companies beyond the half-dozen largest hotel groups.

Here are seven themes that stood out.

1. Hotels Adjust to "Normalized" Labor Patterns

Perhaps the most used term on earnings calls was "normalization." Much media coverage has focused on the revenue side, as leisure travelers pull back from their post-pandemic surge while business travelers return to booking Tuesday and Wednesday nights at past levels.

Less discussed has been how the cost side of the hotel business is also normalizing. Executives are pleased to see inflation moderate, and supply chain issues ease.

Exhibit A: Apple Hospitality, the largest real estate investment trust that owns hotels, said its labor costs are easing. A more competitive job market is leading to higher worker retention at its 224 hotels on average. Contract workers now comprise 8.6% of staff, down from 10.6% a year ago.

"With lower turnover and less reliance on contract labor, we are better positioned to drive incremental property level productivity," Knight said.

CEO Justin Knight sees an upside in the return of business travelers. Their midweek stays are less costly to service than leisure guests' because they are typically in and out. If leisure travelers become more price-conscious, rising numbers of business travelers could offset some pressure.

2. The Inflation Impact Is Moderating But Still a Factor

Chatham Lodging Trust, which owns nearly 40 U.S. hotels, said it was pleased to see a taming of operational cost inflation beyond wage hikes. However, Dennis Craven, chief operating