HotelData.com released its Q1 2026 Hotel Profitability Performance Report, showing U.S. hotels entered the year with improved occupancy, stronger demand and healthier profit margins compared to Q1 2025, while operators forecast a more cautious revenue environment for the remainder of the year. The report draws on aggregated data from thousands of U.S. hotels using Actabl’s operational and financial platforms.
At the all-hotels level, average daily rate rose 6.0% year over year to $202.63, RevPAR increased 8.7% to $129.46 and TrevPAR climbed 9.4% to $174.83. Occupancy gained 1.5 percentage points to 64.3%. Gross operating profit margin rose four percentage points, from 37.8% to 41.8%.
Luxury hotels led Q1 performance, posting the strongest TrevPAR growth and largest GOP margin improvement across chain scales. Economy hotels recorded declines in ADR, RevPAR and TrevPAR, though GOP margin improved through tighter cost controls. Independent hotels saw slight margin compression despite modest TrevPAR growth.
“Q1 showed that demand is still there, but profitability is increasingly coming down to how effectively hotels convert that demand into revenue,” said Sarah McCay Tams, head of research and editorial of Actabl. “Hotels are not necessarily struggling to fill rooms. The bigger challenge is generating the level of guest spend and profitability many operators originally planned for. The quarter reinforced how uneven the market has become, with some segments like luxury continuing to outperform while others face softer pricing and revenue pressure. Hotels that manage pricing, ancillary revenue, and operational costs together will likely be in a stronger position through the rest of 2026.”
For Q2 through Q4, operators forecast ADR to rise 1.6% against 2025 actuals, while RevPAR is forecast to decline 1.3% and TrevPAR to fall 2.6%. Occupancy is expected to remain relatively stable, pointing to softer pricing power rather than a demand shortfall as the primary pressure point heading into the second half of 2026.