Thank you, Chuck. Welcome to Hilton's first quarter 2026 earnings call.

Before we begin, we would like to remind you that our discussion this morning will include forward-looking statements. Actual results could differ materially from those indicated in the forward-looking statements, and forward-looking statements made today speak only to our expectations as of today.

We undertake no obligation to [unclear] financial measures discussed in today's call in our earnings press release and on our website at ir.hilton.com. This morning, Chris Nassetta, our President and Chief Executive Officer, will provide an overview of the current operating environment and the company's outlook.

Kevin Jacobs, our Executive Vice President and Chief Financial Officer, will then review our first quarter results and discuss our expectations for the year. Following the remarks, we'll be happy to take your questions.

With that, I'm pleased to turn the call over to Chris.

Thanks, Charlie, and good morning, everyone. We certainly appreciate you joining us today.

Before we begin, I'd like to acknowledge all those impacted by the Middle East conflict, and I'd like to thank our team members who have adapted very quickly and continue to provide extraordinary hospitality during this difficult time. We remain hopeful for a swift resolution.

Turning to results, we're pleased to report a great first quarter, during which strong RevPAR and net unit growth drove top- and bottom-line results above the high end of our guidance. Performance was driven by strengthening underlying demand trends along with ongoing system-wide share gains.

Our industry-leading brands, strong commercial engines, and powerful partnerships continue to differentiate us from the competition, while a culture of innovation fuels additional growth opportunities. All of this, coupled with our asset-light, fee-based business model, positions us to continue producing significant free cash flow and driving meaningful shareholder returns.

In the quarter, we returned more than $860 million to shareholders, and we remain on track to return approximately $3.5 billion for the full year. For the first quarter, system-wide RevPAR increased 3.6% year-over-year, driven by broad growth across all chain scales, brands, and segments, as well as sequential monthly improvement throughout the quarter in the US.

In the quarter, business transient RevPAR was up 2.7%, representing a four-point step-up in demand from the fourth quarter when adjusting for day of week and holiday shifts, driven by improving midweek demand across all chain scales. Leisure transient RevPAR was up 3.5%, driven by concentrated spring break demand that enabled strong rate growth.

Group RevPAR was up 4.3%, driven by growth in company meeting and convention demand. We continue to see healthy underlying momentum for group, supported by strong growth in corporate lead volumes.

As we look ahead to the second quarter, we remain encouraged by a continuation of demand trends that we've been observing since late 2025 and now through April, but we do expect some headwinds related to the Middle East. For the full year, we expect improving performance in the lower and mid chain scales, with RevPAR strength continuing to move downstream from luxury and upper upscale toward a more balanced, convergence demand shape, or what I have been calling a C-shaped economy.

This trend should be most evident in the US, where supportive tax and regulatory policy, expected lower interest rates, increased private sector investment in AI and the AI complex, and ongoing public infrastructure spending are benefiting the middle- and lower-income consumer and driving broader demand growth. As a result, for the full year, our system-wide RevPAR growth expectations are now 2% to 3%, factoring in a range of scenarios for the Middle East conflict and recovery.

For the year, we continue to expect group to lead, followed by business and leisure transient. Turning to development, during the first quarter, we opened 131 hotels, totaling over 16,000 rooms, representing our second strongest first quarter for hotel openings in our history.

Our luxury and lifestyle brands continue to expand around the world, comprising 20% of total openings in the quarter. Earlier this month in Morocco, we proudly opened the Waldorf Astoria Rabat Salé, kicking off 2026 with another key addition to the Waldorf Astoria portfolio, which now includes 40 trading hotels worldwide, with more than 30 in the pipeline.

Additional marquee Waldorf openings in 2026 will include the Waldorf Astoria Admiralty Arch in London and the Waldorf Astoria Kuala Lumpur in Malaysia. Within lifestyle, our Curio Collection recently surpassed 200 trading hotels, with notable openings in the quarter including the newly built Monarch San Antonio and the converted Hotel Heron Alexandria, Old Town, Virginia.

We also expanded our lifestyle footprint globally with the debut of Motto in Brazil. In Europe, this week, we will open a Home2 Suites in Dublin, Ireland, which marks the European debut of our Home2 Suites brand, one of our strongest performing brands in the portfolio, with more than 800 hotels open and over 750 in development.

This positions this brand for extended, rapid growth and allows us to capture even more demand from this important region. Conversions represented 36% of openings for the quarter across 10 brands and dozens of countries, ranging from flagship Hilton openings in Malaysia, Vietnam, and Thailand to Spark openings in France, Canada, and the US.

Following our Apartment Collection by Hilton brand announcement earlier this year, we now have our first two converted properties in Atlanta and Salt Lake City accepting bookings for this summer. Conversions overall are expected to be up on a nominal basis in 2026 across every region, demonstrating the performance our system delivers to owners.

Despite the current macro uncertainty, signings and starts continue to have momentum. During the quarter, we announced multiple new signings across geographies, including four new brand signings in Turkey, two LXR signings in Japan, the debut of Motto in Australia and France, and the debut of Tapestry in Germany.

In India, we signed a strategic agreement with Royal Orchid Hotels to open 125 Hampton hotels in the market, which puts us on track to exceed 400 hotels in the market in the coming years and reaffirms our commitment to expanding in this key emerging economy. We continue to build out our presence in the fast-growing and expansive region of APAC ex-China, where approvals, openings, and new development construction starts were all up double digits in the first quarter.

Globally, we now expect new development construction starts to be up over 20% for the year, with the strongest growth in the US and EMEA, signaling continued developer confidence and a strong desire to have hotels open in conjunction with a rebounding RevPAR environment. Our pipeline now stands at a record 527,000 rooms and includes brand debuts in more than 25 new countries.

With Hilton representing only 5.5% of global hotel supply and over 20% of rooms under construction, we have tremendous opportunity to grow our market share from here. As we look ahead, we expect that our robust global pipeline, strength in conversions, construction start momentum, and industry-leading brand premiums will sustain net unit growth of between 6% to 7% for the full year, even with the current geopolitical uncertainty.

Innovation across our entire business is a core competency, and when deploying new technology, we're focused on broad, impactful use cases to enhance the guest experience, deliver value to owners, and empower team members. As we advance our strategy, we're leveraging AI to embrace the new ways customers are discovering and engaging with our brands, working with leading partners, including Google, ChatGPT, and Anthropic, all while remaining focused on strengthening direct, loyalty-driven relationships and maintaining discipline in how we manage distribution.

Building on this, earlier this quarter, we deployed an Anthropic-powered platform for customers to dream and shop called the Hilton AI Planner. This LLM-powered tool combines our incredibly rich property content with vast information about local venues and activities to allow customers to search for and tailor an experience that is unique to their interests.

The AI Planner enables guests to spend more time dreaming within our native environment, which should drive incremental demand across our portfolio as customers book with us more often and more quickly. We're just getting started on how technology can customize the customer experience, and the Hilton AI Planner is one great example of how we're delivering our signature Hilton hospitality and enhancing the dream, shop, book, and stay guest journey.

During the quarter, we were proud to once again be recognized as the top-rated hospitality company on the Fortune and Great Place to Work list of the 100 Best Companies to Work For in the United States, marking our 11th consecutive year earning this distinction. We also continue to be recognized for our world-class culture globally, receiving Great Place to Work honors in 17 countries, including seven number one rankings.

Overall, we are very encouraged by the strength of the demand environment across all our brands. We remain confident that our powerful network effect, industry-leading RevPAR premiums, and fee-based, capital-light business model will continue to drive strong operating performance, net unit growth, and meaningful cash flow, enabling us to return an increasing amount of capital to shareholders.

Now, I'll turn the call over to Kevin to give you a few more details on the quarter and expectations for the full year.

Thanks, Chris, and good morning, everyone. During the quarter, system-wide RevPAR increased 3.6% versus the prior year on a comparable and currency-neutral basis.

Growth was driven by broad growth across all chain scales, brands, and segments, as well as sequential improvement throughout the quarter in the US. Adjusted EBITDA was $901 million in the first quarter, up 13% year-over-year and exceeding the high end of our guidance range.

Outperformance was predominantly driven by better-than-expected system-wide RevPAR growth. Management and franchise fees grew 10.4% year-over-year.

For the quarter, diluted earnings per share adjusted for special items was $2.01. Turning to our regional performance, first quarter comparable US RevPAR increased 3.4%, driven by group growth trends continuing from the prior quarter, broad business travel strength, and leisure demand from a concentrated spring break.

For full year 2026, we expect US RevPAR growth to be at the high end or above system-wide guidance. In the Americas outside the US, first quarter RevPAR increased 4.4% year-over-year, driven by strong demand across all segments and continued strength across the Caribbean and South America.

For full year 2026, we expect RevPAR growth to be in the low to mid-single digits. In Europe, RevPAR grew 6.9% year-over-year, led by growth across all segments, Continental Europe strength related to the Winter Olympics and other regional event-driven demand.

For full year 2026, we expect RevPAR growth to be in the low to mid-single digits. In the Middle East and Africa region, RevPAR decreased 1.7% year-over-year, as strong early quarter performance was offset by weakness following travel disruptions from the conflict across the Middle East.

For full year 2026, we expect RevPAR to be down in the mid-high teens as a result of the ongoing conflict in the region, and we expect the biggest impact to be on second quarter performance. In the Asia Pacific region, first quarter RevPAR was up 9.1% in APAC ex-China, led by Australasia RevPAR growth and extended Chinese New Year and other regional events.

RevPAR in China increased 1.3% in the quarter, driven by business segment recovery, but offset by continued pressure in group from softer convention and company meetings activity and leisure due to weaker inbound travel. For full year 2026, we expect RevPAR growth in Asia Pacific to be low single digits, with RevPAR flat in China.

Turning to development, as Chris mentioned, for the quarter, we grew net units 6.3% and now have more than 527,000 rooms in our pipeline. We continue to have more rooms under construction than any other hotel company, with approximately one in every five hotel rooms under construction globally slated to join the Hilton portfolio.

We expect to deliver between 6% to 7% net unit growth for the full year. Moving to guidance, for the second quarter, including the impact from the Middle East conflict, we expect system-wide RevPAR growth to be between 2% and 3%.

We expect adjusted EBITDA to be between $1.015 billion and $1.035 billion, and diluted EPS adjusted for special items to be between $2.18 and $2.24, both impacted by the significant Middle East RevPAR decline and several one-time and timing items that are unique to the second quarter year-over-year comparison. For the full year, we expect RevPAR growth of 2% to 3%, driven by strengthening underlying fundamentals across chain scales and segments, and factoring for a range of scenarios for the Middle East.

As a result, we expect adjusted EBITDA of between $4.020 billion and $4.060 billion, and diluted EPS adjusted for special items of between $8.79 and $8.91. Please note that our guidance ranges do not incorporate future share repurchases.

Moving on to capital return, we paid a cash dividend of 15 cents per share during the first quarter for a total of $35 million. Our board also authorized a quarterly dividend of 15 cents per share for the second quarter.

For 2026, we expect to return approximately $3.5 billion to shareholders in the form of buybacks and dividends. Further details on our first quarter results can be found in the earnings release we issued earlier this morning.

This completes our prepared remarks. We would now like to open the line for any questions you may have.

We would like to speak with as many of you as possible, we ask that you limit yourself to one question. Chuck, can we have our first question, please?

Hi, good morning everyone. Thank you for taking my question.

Chris, obviously a big, notable change in the US demand dynamic. Hoping you could just unpack that a little bit for us.

Our math gets us to probably nearly a 200 basis point increase in your outlook from where you were at the beginning of the year. Could you just walk us through that and maybe elaborate a little bit on your comment around the C-shaped economy?

Are you actually seeing some evidence of that convergence as we get here into April, or what gives you that confidence to kind of make that statement and what are you seeing that's getting you excited about the business? Thanks.

Thanks, Shaun. I think that's a great way to start with the Q&A, because it's the biggest question out there.

I think if you go back, I can have the team fact-check me, but if you go back to midyear last year, I was very much of the mind that I saw, if you lifted up above a lot of noise, that there were some really good fundamental things happening from a macro point of view in the US economy that, to my mind, sort of had to eventually translate into higher growth rates. Now, I will admit that, certainly in the third quarter, as we reported, while I said that, I also said we're not seeing the green shoots or a whole lot of evidence of that yet.

Then again, if nothing, I've been consistent. In the fourth quarter, I repeated my view that we had to start to see what I sort of made up on my own, that instead of a K, a C economy where you see convergence of the lower end, the middle-class, mid-price segments in our industry moving up.

In fourth quarter, we started to see a little bit of evidence of that. Now, I would say, as we're in the first quarter and looking into Q2, where we have part of the quarter behind us, obviously in the sense of April, we have very good sight lines into May, we're seeing it, right?

We're seeing what, to me, was inevitably on its way, but it takes time for these things to sort of seep into the economy. I said it in my prepared comments and at the risk of taking too much time here, but I do think it's the most important question and answer.

What's driving it? I think what's driving it is a number of very big picture things that are going on.

One, forget for the moment the spike in energy prices and oil because of the war in Iran. Broadly, structurally, particularly in housing, you have inflation coming down.

As a result, broadly, again, not in this exact moment, broadly, rates have come down, and I think you can debate how fast, when, second half of this year, first half of next year. I think there's a broad understanding that, particularly if we get the Middle East stuff sort of settled down, you're going to be in a lower inflationary environment, and it will allow the Fed to continue to bring rates down to stimulate the real economy, which is what they're trying to do.

You're in obviously one of the most deregulatory environments in what I can remember in modern history. That means financial services, energy, you name it, across the spectrum, that you have a broad deregulatory regime.

In addition to that, in the backdrop, because of the bill that was passed last year, you are in a multi-year position where you have very, very business-friendly tax attributes, right? That's very hard to get done.

It's certainly not going to get undone during this administration, and let's be honest, when you look at it historically, it takes a lot, even with change of administration, to get that kind of sweeping tax policy change. I think you have a number of years in running room in favorable tax policy.

Then, I'll state the obvious, you have a lot of investing going on in America. Where is that investing?

Obviously, AI, all the AI companies, but the whole AI complex around it, data centers, energy. It's like the great race.

People are spending money like crazy in and around that. You have infrastructure, which I've talked about for a number of quarters.

The Biden-era infrastructure bill, $1.6 trillion, very little of which, percentage-wise, has been spent. The CHIPS Act to re-shore critical manufacturing, again, $800 billion, very little of that is spent.

Why? Because it takes time to get these things, like land, permits, build.

These things take a number of years to sort of seep into the system. I think you're starting to see it.

The best evidence of that, if you go back, and the correlation sort of got obtuse or broken apart during COVID, like a lot of things. Over long spans of time, the highest correlation, 95% plus over a very long span of time, the correlation in demand growth for hotel rooms has been growth in NRFI, non-residential fixed investment.

Sort of like we've lived in Crazyville post-COVID, where we have all this swirling stuff going on, hard to understand. To me, over the long term, that is exactly what is going to drive the business, and that's exactly what's going to drive the mid-market of the business.

All that investing in non-residential fixed investment that takes the middle class getting in the game. If you look at those numbers, they've been moving up and they're perennially bad at forecasting NRFI, from my experience.

The actual numbers being reported are moving up, and my guess is the next several years they're going to keep moving up. As they do, you're going to see this convergence.

With all of those things going on, you're going to see this convergence. By the way, if that's not enough, I know it's a whole different topic of displacement and everything that goes with AI, but AI is also going to provide one of the greatest productivity booms.

It's going to be equal to or bigger than the internet productivity boom. Yes, there's winners, there's losers, there's need to retrain and shift and reskill people, all of that stuff.

We won't get into today with the limits of time. There is no world where, economically, it's not advantageous to have productivity gains.

There is no world, there is no time in American history where big productivity gains weren't matched with big economic growth. I sort of put all that together and I feel like, okay, it's happening.

I want it to keep happening. I want to be thoughtful about we're talking about a little bit of fourth quarter and the first quarter and now looking into the second quarter.

I don't want to overcook it, but all those things I've been thinking, I think are happening, and I think it's now showing up in our business. It makes me feel good that we could be in a time frame, honestly, where I love it when we're sitting around at this very table every week talking about performance, and every time we talk, it's getting better, right?

That's what's been happening for a while. For weeks and weeks, it's getting better, and as we look further out in the year with the visibility we have here in the US, it feels better.

Reality is, we gave guidance. The Middle East, I'll leave that to somebody else to ask, creates some uncertainty, but I think you could make an argument that we are being reasonably conservative with our full year guidance.

Thank you so much.

Hey, good morning, everyone. Thanks for the question.

I suppose I'll take the bait on the Middle East there. Can you just remind us what the exposure in terms of EBITDA or fees across your businesses there?

I guess, how do you think about the Middle East dynamic and disruption there flowing through to the other regions of your business throughout the course of the year, and impacts to US outbound travel?

Sure. Middle East is about 3% of the business.

You'd say, all right, well, it's not that big a part of the business. Like Q2, you see that, is impacted by a few things, some one-time stuff that Kevin mentioned from last year.

It's also impacted by the Middle East. The Middle East, for Q2, which is when we think it'll probably be, most dramatically impacted, if it's 3%, it could be down 50% or something like that.

You guys can do the math. That could be 1.5 points on system-wide.

Whatever guidance we gave you, if the Middle East were doing what it normally does, it wouldn't be which had been running in the high single digits, low double digits. Now, for a quarter minus 50, you've you flip that around and in Q2, you you would be above where where you were in Q1.

Even though it is a small percentage at 3%, when you get in very large numbers, small percentage of a large number becomes a decent-sized number. Having said that, we are already does I don't know where this is all going to play out.

I'm looking down out my window to Washington. We'll see.

I don't, I don't know. I suspect there will be an off-ramp eventually, just given a lot of things, politically and otherwise in the not too distant future.

Things have already settled down a bit. We are already starting to see, again in my weekly around this table, when I'm getting reports, certain markets, within the Middle East that are some of our bigger markets are starting to sort of stabilize and move up.

They're they're still quite impacted, but they're they're getting better. What we tried to do in our guidance was, again, on the margin, be a bit conservative, and thinking about a a range.

Like in the first quarter, we think it was probably 30 or 40 bps, something like that. In Q2, I just gave you the metric.

It's probably a point and a half. For the full year, it's probably 0.5 a point to a point impact, depending on what you think the trajectory will be.

At, at the lower end of that range, and thus at the lower end of our overall guidance range, I think, what we've assumed is it stays pretty bad, and that there is, in fact, some knock-on impact to your to your question. There's some knock-on impact on other markets.

We've seen a little bit of that, a little bit in India, particularly Bangalore, a little bit in the Seychelles and Maldives because of transit through Dubai, but not a lot of knock-on impact. We've assumed if it stays really bad, there'll be a little bit more.

Then obviously on the on the upside, that, you continue to things stabilize and you continue to have recovery, but not, not necessarily a super V-shaped recovery, just sort of grinding grinding back up through the rest of the year. Again, my experience, I I'm sad to say I've been doing this long enough, I've had to live through stuff like wars and pandemics and like whatever else, it feels like.

I feel like, in this moment, we're we're trying to be responsible with you all and telling you we're giving you a range of outcomes that, that we think, are rational, and if anything, probably probably on the conservative side, as as they should be. In terms of, I mentioned it on the development side, only about 2% of our deliveries for the year are coming out of the Middle East.

Those are those are important deliveries. We do think things will slow down a little bit there.

It's so early in the year, we don't know. Again, that's why, we I I think, but but for that, we probably would have been telling you we're in the upper half of our our 6% to 7% range.

Because of the Middle East and potential for supply chain knock-on in other parts of the world, we feel like, keeping the range where it was was more appropriate. Again, you could say we're being too conservative, whatever.

That, war is war. There's a lot, a lot of a lot of possible outcomes.

We've tried to frame it around those and be and be thoughtful about it.

Got it. Thanks so much for all the detail.

Yep.

Thanks. Appreciate all the color on the macro.

As we look at some of the actions outside of RevPAR, particularly the launch of this Select Brands, can you elaborate on how this compares to a typical brand agreement, and what are some of the guardrails for what brands you'd be willing to include going forward? If I can just sneak one more that's related on: does this launch change the way you think about either the marketing or system funds allocations, or even M&A?

No to the last part of that. I'll answer that.

That doesn't change any of that. The way to think about Select is like anything we bring in the system, the first step is quality.

Does it add to our network effect? Is it a swim lane or a brand that we think our customers want, that has the quality that we have promised to give our customers, and that we think it will create a benefit, a strengthening to our network effect?

That's always the first filter. If it doesn't meet the criteria of we already have something on top of it, or we don't like the quality, we're not doing it.

By the way, we've had dozens of opportunities in Select that you don't know about because we haven't done them. We've done one.

I suspect there will be others. I don't know how many there'll be because we're super stringent on what we would do.

The way to think about it, and YOTEL is a great example, is it's a great smaller brand. Customers love it, the quality is good, and they have a real following, but they've had a real problem without having global scale and all the network effect that we have and the ability to invest in technology and all those things at the level we do to sort of make it work the way they want it to work.

That was a unique opportunity for us to say, we love it. We did a lot of work.

We think our customers like it, would resonate well, the quality's good. Importantly, we're entering into agreement that is consistent with the way we would approach any franchise agreement.

This is a franchise relationship with them. We are getting, and if you look at the I know there's been a lot of noise out there, but there's a ramp involved like a lot of our larger multi-unit franchise deals.

If you look at a run rate basis, this is very consistent in how we charge for license fees, system fees, all of that. It is on a fee-per-room basis, very consistent with a product in that category.

The difference is, it's just a little unique brand. Could you do it somewhere else?

You could say what's the difference between that and doing it as a Tap or whatever. YOTEL is a good example.

It's unique. It doesn't fit in Tap or Curio.

It's its own thing. We don't want to have cognitive dissonance with our customers as we bring things in the system, and we liked the brand.

We wanted it to stand on its own, but we want to do it in the right way. We want to get paid for the effort, and we want it to be something our customers really think enhances the broader system.

There'll be others. I'm sure we're working on a bunch of others, but like I said, turn-down ratio is very, very high.

Obviously, the appetite for folks that have small brands, I think is quite high in an environment where we have this much scale and the ability to how we work with all the intermediaries, the dollars we can invest in our commercial engines and technology. I think we have a real competitive advantage.

That's why the average market share of our brands is so high and much higher than our competitors. Increasingly, little micro brands around the world, I think, not all of them, but some are figuring that out.

We've been talking to a bunch of them. I suspect some others will come into the fold over time, but we'll be hyper disciplined about it.

Again, quality, the brand works, fits in our ecosystem, and the fees per room are good, we get paid for the effort.

Thanks. Appreciate all the detail.

Hi, good morning. Thanks for taking the question.

I wanted to go back to the AI and kind of technology side of things. Obviously, things are moving very, very quickly.

You mentioned you launched the Hilton AI Planner. I guess just now, another quarter into things, how do you think about what the kind of real opportunity set here is long term?

Both obviously on the OpEx side of things internally, but then as you think kind of bigger picture externally from the distribution side of things also.

Yeah. I we talked about this I think at at fairly good length on the last call, and it obviously an important question, and given the amount of time we're spending on it, and everybody is, it would be fair to say it's worth addressing.

I would say, you're right. A lot of effort going into it by everybody, certainly by us.

Things are moving very quickly. I would say, as every day goes by, we're learning and and iterating and and thinking and doing different things and working with different partners in different ways.

I think the opportunity gets more, not less, interesting. I I know that's what you'd expect me to say, but I believe it to be through true.

I think, the three buckets of how we think about it haven't really changed. I think we think about this as a, a means to create, to use our scale as a weapon in creating efficiency, which we think can translate into being more efficient at how we go to market and how we deliver for our owner community, and more effective.

Yes, that could benefit our P&L too. Really, the largest part of our system costs really relate to the part of the system we manage on behalf of owners.

Every time we can create we can be more effective, more efficient in that world, it can translate into benefits for our owner owner community, who need it and want it and deserve it. Our Project Rise, this year was in part enabled by work that we're doing in this bucket, if you will.

I'd say we're early days, and I think we have huge opportunities to think about systems and processes across what is a very big global company to continue to gar- garner efficiencies, but most importantly, to be much more effective, be able to move quicker, add hotels, ramp them quicker, just because, we take great systems, but antiquated systems, and we, we we hyper modernize those. In the in the second bucket, you you heard me mention we're working with a bunch of the folks out there, Gemini and OpenAI.

We're going to be opening our app within their environment the next couple of weeks. Talked about our AI AI Planner in our environment that we did with Anthropic and Claude.

We're working with everybody, and, while it's moving fast, there's a long way to go. I do increasingly feel really good about what the opportunities for us are.

If you think about it at a at a high level, if you look at the quality, using the US market as as an example, if you look at the quality hotel market in the United States, we're over 25% of the market. I think that puts us in a and we and we are the only ones with that 25% of the market that control rate, inventory, availability, period, end of story.

Nobody can get it unless we give it to them. In a world where you have a a more competitive environment, they're a bunch of debates: who's going to win, who's going to lose?

That's not for us to judge. I think there they're probably going to be more there's going to be more than one winner, that's why we're working with everybody.

We realize the asset we have in in the system and the control of the system, and given our scale, is really valuable, and that effectively, people really do need us. If you're going to have, you can't be missing 25% or 30% of the quality inventory in the in the US and and have something that's a real full offering.

I I like where we sit. It's complicated, it's fast-moving, there's risks, but we're we're approaching it, very much in the form of a partnership with all of the counterparties that are developing these technologies.

We want to show up with all of them, and in the end, I do believe, as a result of the great work they're doing and a result of discipline on our side, that there's real opportunities to create more efficient, more effective distribution. There just there sort of just has to be if we're smart about it, and we intend to be.

Then the last bucket, AI Planner isn't is is is in impact in fact, part of it. You think about when we have a stay experience, people are with us, you're customers, we have all sorts of opportunities to like equip our team members now with with all the information we have with technology in the palm of their hands to deal with problems, to customize the experience.

We're testing and learning in the stay experience with really cool things that really revolutionize the stay. We also, a lot of the engagement we have is with our customers is digital.

Think about when they're dreaming, booking, planning, post stay, and so, and they're not with us. That's about trying to make sure that the approach we have dig- digitally with folks is utilizing all the best thinking and technology to create a very engaging experience so that, yes, when they're with us, they have the best stay experience in the business and that's why they want to come back.

When they're not with us, in these other steps of the customer journey, they feel equally good about our ability to give to satisfy their needs and to customize at mass scale. Again, all this stuff, we're doing things.

We talked about it. You can go play with the AI, the Hilton AI Planner, stay planner.

It's early days, but the but we're doing super important foundational work. The last thing I'd say is, our tech stack, and it's not by happenstance, is very advanced.

So, many years ago, COVID like turned into a time warp, but pre-COVID, probably eight eight or nine years ago, we made the decision to really completely blow up all of our legacy architecture and make sure that our core systems and otherwise were, cloud-based, open-source, microservices-driven, which means a totally modern tech stack that has like incredible agility. Agility, and the ability to have control.

It's a system built on, on certain elements of table stakes sort of technology. It might build off an existing platform, but where we customize and modify it, it's things we own and control, and so it gives us, we think, a really unique ability to be agile and do things for customers that are going to be unique that others, that are going to be with monolithic providers, can't do.

That was a very purposeful decision to my tech team. They're extraordinary, and and leading that effort over a bunch of years, and I would say it just puts us in a really good position in in in the world we live in where AI is coming and you have all this opportunity.

If you don't have the flexibility and agility on a tech stack, it it doesn't really matter, cuz, it'll sort of like the the machine stops. So, I'll leave it at that.

We could talk AI all day, but we're we're and we do around here talk about it a heck of a lot. That's probably probably enough for today.

Thank you.

Hey, good morning, and thank you for taking our question. Just wanted to follow up on the expectation for conversions to be up in 2026 across every region.

Do you think this is a new normal for conversions moving forward, or will we revert back to a more normalized conversion level versus new construction mix? Is there anything to think about from a fee perspective longer term if conversions continue to be a greater portion of the fee mix moving forward?

I don't think there's any material impact on the fee side of it, answering that first. This year we're going to tick up.

As I said, last year we were 36%, we're trending a bit above that, probably 38% to 40% in the latest numbers. There's a lot of moving parts in the year for the year.

We think it's going to be up modestly. I actually think the math of it is such that on an absolute basis, I don't think you're going to see a big drop-off in conversions.

As a percentage of NUG, I do think you will see it moderate over time. That's because you've been in a world where construction starts haven't really gotten back to pre-COVID levels, and that will happen and is happening.

It probably happens this year, and as you start to have that happen over the next two or three years, and new construction grows in an absolute sense, I think the percentage will decline. I don't think it'll ever go back down.

We peaked during the Great Recession in the low 40s. We're sort of back there now.

Went as low as high teens. I don't think we're going to be in a world where it's high teens.

When it was high teens, let's be honest, we had 1.5 brands sort of like Hilton and DoubleTree when it went that. Now we've got a dozen or more brands that are really good candidates for conversions.

I think you're probably sort of permanently in the 30% to 40% range. Maybe I'm making that up, but directionally, if you did the math on new starts, I think you're sort of permanently in that range.

Hi. Good morning,

and

thanks for taking my question. I know you said you'd like to sort of leave the AI discussion right where it is.

I wanted to ask something just a little more industry level, if that's okay. It's obvious that you're making great progress and working at terrific speed.

Outside the industry, not talking about competitors or peers, right, there's sort of an independent track that's going on, and there's also an OTA environment that's also, I assume, moving as fast as they can. How do you envision those dynamics sort of playing out, and do we evolve into kind of a different industry landscape in that regard?

Or are you just running your race and largely not paying a ton of attention to what they're doing?

Oh, no. We of course are paying a lot of attention to what everybody's doing.

I do think, on the margin, over the next 5 years from now, it'll look a lot like it does today or has looked. I think, on the margin, though, if we do our job, I think AI allows us, as I said, to be more efficient and more effective.

That is code for continuing to build more direct lines to our customers. We have a terrific relationship with the OTAs, and we do a certain segment of our business with them, and I suspect we will for a very, very long time.

I think our control over our inventory, our ability to customize the experience in unique ways, it being a more competitive environment where there isn't just one winner in search probably when it's all said and done, I think that puts us in a position where it gives us an advantage relative to what we've had to continuing to build more direct business. Now, 80% plus of our business is already direct, we've had a fair amount of success in doing that.

I think, on the margin, it helps in that regard. I'd go back to where I started.

I don't see that the whole system changes in a material way anytime soon.

Okay. That'll do.

Thank you very much.

Great, thank you. My question is not about AI.

Just looking at results, fantastic results, and I think that full year RevPAR raise higher than the market was expecting. I am curious, last quarter you had a slide that showed that a 100 basis point raise in RevPAR would be a 100 basis point raise in EBITDA, and it looks like it's maybe sort of more like a 50 basis point raise in EBITDA.

Your G&A didn't change, just anything else you would call out in that sort of flow through to EBITDA from the raise? Thank you.

No, Robin. I think, look, I think the rule of thumb we would use and, maybe the 100 basis points was a little bit of rounding and I think we've actually updated that more recently.

The rule of thumb we'd use is about $25 [million] or $30 million of EBITDA per point. We raised our guidance, our RevPAR guidance, by one full point.

If you think about that as being typically $25 to $30 million, the things that are going on there is you just have the impact of the Middle East with a little bit of IMF and a little bit of FX, which caused us to raise the midpoint by $20 [million] instead of, call it, $25 [million] at the low end of the range. That's the way to think about it, and it's not more complicated than that.

Great. Thank you.

Sure.

Good morning, everybody. Thanks for taking my question.

Back to demand. You sounded really good on group business.

That was sort of the downside surprise for the industry last year, obviously with tariffs. Just sort of curious, when you look out and expect group to still lead, are you actually seeing in the year for the year group bookings materialize better than planned, or is it really just sort of easy comps that give you that confidence?

No. We're seeing real lead volumes and bookings in line with the forecasting we have.

Atmospherically, in the discussions that our sales folks are having, broadly about sentiment in that space, and the corporate space for that matter, are much better, quite good. Listen, people are feeling better and they're spending more.

They need to move more, they need to aggregate people more, and we're seeing it show up. The booking position supports it, the leads more than support it.

Thanks, everyone.

Hey, guys. Thanks for the question.

Just getting back to NUG, to the extent that the disruption in the Middle East might cause some impact on 6% to 7% growth this year, is that just some of the either conversions or new builds kind of fall out of the system? Or the expectation if you were not at the high end of that range for this year, would most of that just fall into 2027?

It's timing. It's just timing.

We're not concerned that anything's falling out of the pipeline or conversion opportunities are drying up. It's just there's a lot going on over there, and some people have slowed construction, they've slowed decision-making on conversion deals that we're working on.

I don't think we feel like any of it really ultimately falls away. I think it's a question of when it gets done.

It's early to say. By the way, our team says it's picking up by the day, Saudi Arabia sort of isn't missing a beat; UAE, a little bit more disrupted; Kuwait, Qatar, much more so, because the issues there have been more dramatic.

Really, it's not like one monolithic area, it's country by country. We're watching it carefully.

I don't think these are things that disappear. I think it's just a function of it may push a quarter or two.

Got it. Thanks.

Hey, thanks. Just to stick on that theme, as you think about your share of rooms versus much larger share of rooms under construction, what markets do you feel like that disconnect opportunity is biggest?

Basically, what geographies offer the best share gain opportunities you look out maybe over the next five years?

Wow. There are a lot of them.

I would say, where we have what we call inside the company springboard work, which is where we see sort of the disconnect in terms of demand for our products and what is a relatively low existing base of hotels. I would say India being first and foremost.

We think easily it's a 10 or 20x sort of opportunity. We have whatever, 40 hotels in India.

With the deals like the one we announced today, we sort of have 400 in and around the pipeline or under development. India is definitely one.

Southeast Asia is another, where we have a big presence, but we think the opportunity is to be three or four times the size there we have. CALA, the broader CALA environment, we've got a big presence of 300 hotels, but we think we could be easily two or three times that size.

KSA, we have 25, 30 hotels. We think we could easily be four to five times that, yeah, probably even more, as well as other parts of the Middle East.

Obviously, the Middle East, we just talked about, there's some challenges. In part because I'm always an optimist, but I do think one way or another this will settle down, and there's a lot of momentum underlying travel and tourism in the Middle East that I think will pick up pretty quickly when you get to the other side of this conflict.

I shouldn't forget Africa, where huge population. We've been there for many, many decades, but have a relatively small base and a huge opportunity.

The reality is we've got 27 brands, and if you look at the average number of brands that's deployed in any market, I think it's four brands with 27. Even where we have more density, there's a tremendous amount of network yet to build and thus growth.

Then in the markets I just covered, I would argue in almost all of them, other than maybe CALA where we have 300 hotels, the others we're in sort of our nascent stages. The brand's well known, we perform really well, we've had a presence a long time, but relative to the populations and the demand base, we're just getting started.

It's why we get really excited. I get the question, "Well, how long can you grow 6% or 7%?"

My view is a long, long time, simply because the world's a big place. Populations all over the world need to be served.

Most of the markets I just described, they're way underserved relative to any of the other more mature markets. Yet our brands do well there, customers recognize us, and it's an opportunity to really build a powerful network effect in many of those places.

Thank you.

Thanks, everybody. As always, we appreciate the time.

As you can tell, there's a lot going on in the world, there's no question about it. The Middle East is not helpful.

But 75% of our business is still driven out of the US, and we have seen really nice uptick in performance, driven by a really nice uptick in demand across all segments. We think that is sustainable as we look out for the rest of the year and beyond.

Notwithstanding everything going on in the world, we feel really good about our ability to drive top line, drive unit growth, obviously the free cash flow that we need to drive, and keep returning capital as a serial compounder. We feel great about the business, look forward to catching up with you after the second quarter to give you the update on everything going on.