H World Group's Q2 2025: Unraveling Contradictions in RevPAR, Asset-Light Strategy, and Growth Prospects

RevPAR expectations and business travel demand, asset-light transformation strategy and cost optimization, revenue growth strategy and asset transformation strategy, cost optimization and asset-light transformation, asset-light transformation strategy and timeline are the key contradictions discussed in H World Group Limited's latest 2025Q2 earnings call.



Revenue Growth and Asset-Light Strategy:
- H World Group reported group revenue of RMB 6.4 billion for Q2 2025, up 4.5% year-over-year.
- The growth was primarily driven by a focus on asset-light strategy, particularly the expansion of the manachised and franchised business.

Hotel Network Expansion and Profitability:
- The group achieved an 18.3% year-over-year increase in the number of rooms in operation, contributing to a 15% year-over-year growth in group hotel GMV to RMB 26.9 billion.
- This expansion was facilitated by enhancing product quality and supply chain capabilities.

Supply Chain Optimization and Cost Reduction:
- H World has successfully optimized their supply chain, resulting in a 10% to 20% year-over-year cost decline in key areas like furniture and construction period reduction of 30 days.
- This has significantly improved product quality and efficiency while reducing costs.

Strategic Focus on Economy and Middle-Scale Segments:
- The company's asset-light business revenue grew by 22.8% year-over-year, contributing to nearly 2/3 of the group's total gross operating profit.
- This growth was supported by the strategic focus on the economy and middle-scale segments, catering to the mass market's preference for value-for-money products.