InterContinental Hotels Group PLC

IHG reported first-half 2026 revenue of $1.255 billion and EBIT of $655 million, up 7% and 10%, respectively. Fee business revenue increased 7% to $971 million and fee business operating profit rose 8% to $640 million; fee margin expanded 120 basis points to 65.9%. Adjusted EPS increased 13% to $2.747, and adjusted free cash flow was $360 million, up $58 million from H1 2025. Global RevPAR grew 4.1% in the first half, with Q2 RevPAR up 3.5%; Americas RevPAR rose 4.8%, EMEAA 3%, and Greater China 3.1%. For guidance, IHG narrowed adjusted interest expense to $230 million-$240 million for the full year, kept overhead growth guidance at 1% to 3%, maintained key money and maintenance CapEx guidance of around $200 million-$250 million annually, and reiterated gross CapEx of around $350 million a year on average. The company said the $950 million buyback is 42% complete and expects ordinary dividends of around $285 million plus the buyback to return more than $1.2 billion to shareholders in 2026.

Elie Maalouf said the quarter showed the strength of IHG’s diversified, asset-light model and its ability to grow across geographies, segments, and fee streams. He emphasized that the company’s strategy from 2024 is working: broader brand reach, more geographic diversification, stronger technology, and expanding ancillary revenues are supporting both RevPAR and system growth. His tone was confident and upbeat, with repeated references to record development activity, a strong long-term outlook in the U.S. and China, and confidence that IHG still has more room to grow.

Michael Glover highlighted the hard numbers behind the quarter: revenue of $1.255 billion, EBIT of $655 million, fee revenue of $971 million, fee business operating profit of $640 million, and fee margin of 65.9%. He said adjusted EPS rose to $2.747, adjusted free cash flow was $360 million, cash conversion stayed above 100% on a trailing 12-month basis, and net debt remained within the target leverage range. On capital allocation, he pointed to the $950 million buyback program, the $0.645 interim dividend, and reiterated CapEx guidance of around $200 million-$250 million for key money and maintenance and around $350 million gross CapEx annually.

Analysts focused on three issues: weaker China RevPAR in Q2, the gap between RevPAR/system growth and fee growth, and whether IHG might change owner charge-outs or commercial fees in response to industry pressure. Management said China’s softer Q2 reflected pulled-forward demand from Chinese New Year and new school holidays, not a structural problem, and pointed to continued profitability, record openings/signings, and no sign of oversupply. On the fee-gap question, management said most of the difference comes from newly opened hotels that take time to mature and from fee schedules that step up over time; they said the gap has already narrowed somewhat and should keep improving. On owner economics, IHG said it has already reduced loyalty assessments, reward reimbursements, marketing costs, and other owner expenses, and that its new commercial services model is designed to lower costs further while expanding services, but it did not commit to broader charge-out cuts like some peers.