How Resorts Are Redefining 2024 Hospitality Profits

Resorts across the Americas and Europe are leading the charge in profitability, consistently outperforming regional averages and pre-pandemic benchmarks. These leisure destinations have proven their enduring appeal, particularly in Europe, where flow-through rates highlight a remarkable ability to convert revenue into profit—outpacing the Americas and underscoring the region’s performance amid a massive surge in 2023. The performance of these properties underscores the importance of high-yield revenue streams in securing financial stability. As Juan Gallardo, HotStats Director for Hospitality Intelligence – EMEA, puts it,

“Looking at Europe’s performance, it’s clear the trends are greener here than in the Americas. The top line has grown in 2024, driven by both ADR and occupancy—and it seems more Americans are choosing Europe for their holidays. What stands out is the exceptional conversion rate of European hotels, with profit growth outpacing revenue increases. This shows that European hotels have adapted to rising costs—energy, labor, and supplies—over the past few years, making them better prepared to weather a slowdown in revenue.”

Beyond leisure destinations, the global wellness movement has emerged as a powerful force in shaping revenue streams. Spa services, which were once considered ancillary, are now significant contributors to profitability. This shift reflects changing consumer preferences as travellers increasingly prioritize health and rejuvenation. Hoteliers who invest in expanding their wellness offerings are tapping into an enduring trend that aligns with modern lifestyles and creates long-term revenue potential. 

The recovery of group travel is another key factor in reshaping the industry. While transient travel remains dominant and has exceeded 2019 levels, the resurgence of conferences and large gatherings has driven notable growth in food and beverage revenues. Conference and banqueting operations are witnessing a resurgence, underscoring their importance in a more balanced revenue portfolio. At the same time, the normalization of global travel has brought stability to booking patterns, with a significant reduction in cancellation and attrition fees. This trend allows operators to plan with greater confidence, optimizing operations without the uncertainty of last-minute disruptions. 

Regional disparities also highlight the complexity of the recovery. European markets are setting a high standard for profitability, with the region leading in flow-through efficiency. This is driven primarily by countries like Germany and Austria, which are recovering from a lower base, and France, which experienced an exceptional summer boosted by the Olympics. Meanwhile, the Americas show a more varied performance landscape, with standout successes in resort areas but uneven results across other segments.

“The Flow-Through metric in Europe is notably stronger than in the Americas, reflecting the region’s resilience. Over the past few years, European hotels have become accustomed to rising expenses, making them more prepared for a potential revenue slowdown. This indicates that we have reached the end of the recovery phase, signaling a shift toward stabilization”, added Gallardo. 

Seasonal patterns add another layer of nuance to the trends shaping 2024. Year-over-year variations across quarters reflect a complex interplay of factors, from shifting demand patterns to macroeconomic conditions and changing travel behaviours. These fluctuations emphasize the importance of data-driven decision-making, as hoteliers must continuously adapt to align with seasonal and regional realities. 

Gallardo reflects on the industry’s reliance on actionable insights, emphasizing,

“It’s important to remember that not seeing record-breaking figures doesn’t mean we aren’t performing well.”

His words resonate deeply as hoteliers navigate mounting pressure to refine operations, seize emerging opportunities, and tackle ongoing challenges. 

The hospitality sector is undergoing significant transformation, from the growing importance of wellness revenues to the recovery of group travel and geographic disparities in profitability.  

Operators who adapt to consumer shifts, focus on high-performing revenue streams, and leverage real-time data and benchmarking tools are better positioned to navigate uncertainties, seize opportunities, and thrive in an evolving industry.

To stay ahead of these trends and gain tailored insights, visit HotStats and explore how we can empower your property with profitability intelligence. Subscribe to our blog or connect with our experts today at www.hotstats.com. 

by the HotStats Team

Photo by Xavier Coiffic on Unsplash

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