Pride and Prejudice: How Anti-Trans Policies Are Hollowing Out U.S. Tourism

The U.S. travel and hospitality sectors, already grappling with post-pandemic volatility, now face a new existential threat: the exodus of LGBTQ+ tourists. A confluence of anti-trans legislation, corporate sponsor pullbacks, and shifting traveler priorities has created a geopolitical and economic reckoning. For investors, the writing is on the wall: U.S. tourism stocks are overvalued, and exposure to this sectoral underperformance demands strategic hedging—or better yet, a pivot to LGBTQ+-friendly competitors abroad.

The Policy-Priced Exodus: Data That Can't Be Ignored

Anti-trans policies have become a geopolitical liability. Oxford Economics estimates that anti-LGBTQ+ rhetoric and trade tensions have cost the U.S. $8.5 billion in international tourism revenue in 2025 alone. The damage is most acute among affluent LGBTQ+ travelers, whose households earn over $150,000 annually and spend 30% more on travel than average tourists.

Take the Canadian market: bookings for queer-friendly U.S. destinations via misterb&b fell by 66% from February to April 2024 compared to 2023. Europeans, too, are voting with their wallets—32% fewer bookings for red states like Utah and Arizona. Meanwhile, Canada's LGBTQ+ tourism sector is booming, with cities like Toronto and Vancouver welcoming displaced travelers.

Marriott's shares have lagged the broader market, down 18% since 2023, even as occupancy rates recover. The disconnect? Investors are beginning to price in the long-term reputational and revenue risks tied to anti-LGBTQ+ policies in key U.S. markets.

The Pride Paradox: Participation Rises, but Reputations Crumble

Pride events in conservative states like Utah and Idaho have seen attendance surge—Salt Lake City's Pride drew 17,000 attendees in 2025, up from 10,000 in 2024—as communities resist restrictive laws. Yet corporate sponsors are fleeing. San Francisco Pride faces a $750,000 shortfall, while NYC Pride lost 25% of its sponsors.

The problem isn't just revenue—it's brand integrity. Companies like Egale Canada now avoid U.S. conferences, while European governments issue travel advisories. For hospitality chains like Hyatt (H) and Carnival Cruise Line (CCL), this reputational damage is a double whammy: they lose both direct spending and the halo effect of LGBTQ+ travelers' discretionary budgets.

Hyatt's revenue growth has stagnated at 2–3%, while Accor's LGBTQ+-inclusive properties in Paris and Barcelona are seeing double-digit gains. The divergence underscores a stark choice for investors: bet on the U.S. backslide or the European upswing.

Investment Implications: Short the Overvalued, Back the Bold

The sector's underperformance is structural. Anti-LGBTQ+ policies aren't just a moral issue—they're a geopolitical headwind that will persist for years. For investors:

1. Short U.S. hospitality stocks: Marriott, Hyatt, and regional players like Las Vegas Sands (LVS) are overvalued relative to their reputational risks. Consider inverse ETFs like PROB or individual shorts.
2. Avoid event-driven equities: Companies tied to Pride sponsorships, such as live entertainment firms or regional airports, face declining revenue streams.
3. Go long on inclusive competitors: Canadian brands like Fairmont Hotels (AC.H) and European operators like TUI Group (TUGG.Y) are attracting displaced travelers.

The Bottom Line

The LGBTQ+ travel market is a $296 billion juggernaut—and it's leaving the U.S. behind. Anti-trans policies have turned the hospitality sector into a geopolitical liability. Investors who ignore this shift risk overpaying for underperforming assets. The time to act is now: short the red states' overvaluation, and back the blue states—and their allies abroad—that are building the future of inclusive tourism.

The data is clear: the world is moving on. Will you?