U.S. Hotels Face Soft Summer Demand as International Arrivals Lag

Alketa Kerxhaliu
Jul 21
19 min read

Updated: Jul 25

Introduction

The U.S. hotel industry is experiencing an underwhelming summer season in 2025. Key performance metrics have slipped below last year’s levels even as the traditional peak of summer travel approaches. In early July, revenue per available room (RevPAR) was down year-over-year for consecutive weeks, with a 3.7% decline for the week of July 6–12 (after a 1.1% drop the prior week). This softening demand is most pronounced on weekdays, pointing to a continued lull in business travel. Meanwhile, weekend leisure demand – though stronger than weekdays – is also beginning to slow amid economic worries and rising competition from alternative accommodations. Overall, a combination of factors – from weak corporate travel and shifting travel preferences to an imbalance in international tourism flows – is creating headwinds for U.S. hotels during what is normally their busiest period.

Importantly, the “travel pie” hasn’t shrunk overall, but hotels are seeing a smaller slice of it. Total traveler numbers remain robust; in fact, TSA passenger screenings have been on the rise even as hotel stays sag. This indicates that many travelers are choosing other lodging options or destinations. Summer is peak season for short-term rentals, vacation homes, cruises, and camping, which are capturing a growing share of demand that might otherwise fill hotels. Additionally, a strong outbound travel trend – Americans vacationing abroad in record numbers – coupled with a slower recovery in inbound international visitors means fewer heads in U.S. hotel beds. All these dynamics are converging to make Summer 2025 a challenging season for U.S. hoteliers.

Weekday vs. Weekend: Business Travel Lags Leisure

One clear sign of the industry’s struggle is the divergence between midweek and weekend performance. Weekdays (Monday–Wednesday), a proxy for business travel, have consistently underperformed weekends (Friday–Saturday) since the start of summer. Occupancies and revenues in midweek have been lackluster, reflecting the continued weak state of corporate travel and group meetings. Many companies have reduced business travel budgets or still rely on virtual meetings, and the usual bump from conferences and conventions is uneven. By contrast, weekend leisure demand – bolstered by vacationing families and events – has held up better.

However, even leisure travel isn’t booming the way it did in early post-pandemic summers. Hotels report that weekend growth is moderating, with some markets seeing flat or even declining leisure metrics compared to last year. Travelers are becoming more cost-conscious due to economic uncertainty and high prices. Rising costs of flights, gas, and general inflation have made some vacationers scale down trips or seek better deals. Furthermore, the availability of alternatives like Airbnb rentals or road trips to campsites means leisure travelers have more options than a hotel stay. The net effect is that hotels are not capturing the full benefit of the summer travel crowds, especially on weekends, unlike in typical years.

This weekday-weekend gap is stark when looking at recent data. As of mid-July, weekday hotel RevPAR was down significantly more than weekend RevPAR year-over-year. In fact, the hardest-hit segment midweek has been upscale urban hotels that rely on corporate travelers. For example, upper-upscale hotels saw weekday RevPAR plunge 7.6% for the week of July 6–12, the largest decline of any chain scale. This underscores that the business travel recovery remains elusive, nearly three years after widespread travel resumed. Until offices return to full travel schedules or conferences rebound strongly, hotels in many cities will likely continue to see underused rooms Monday through Wednesday.

Meanwhile, the smaller drop on weekends (and even some growth in pockets) shows that leisure demand is propping up many markets. Resort destinations and places within driving distance of major populations are still enjoying summer getaways. But the leisure segment, too, is not immune to fatigue. Surveys show Americans still prioritize travel, but with more caution in spending. According to recent research, travelers are rating their excitement to travel at roughly 8.2 out of 10, similar to last year, and 94% have trips planned in the next six months – yet many plan to trim expenses on those trips in response to economic jitters. In short, demand is there, but travelers are value-sensitive, and hotels are feeling the pinch when trying to fill rooms at profitable rates.

Business and Group Travel Remains Subdued

Another factor behind soft weekday performance is the sluggish return of group and corporate travel. Recent data shows group demand at high-end hotels fell about 9.8% year-over-year for early July. Conventions, corporate meetings, and other group events have not fully rebounded to pre-pandemic norms, except for isolated spikes tied to big events. In the week following the July 4th holiday, many hotels saw a notable drop in group bookings compared to the same period last year. This was partly an expected calendar effect (since some groups shifted schedules around the holiday), but it also continues a pattern seen most weeks since Memorial Day – group business has underperformed expectations.

On a positive note, average daily rates (ADR) for group business remain resilient, even in the face of lower attendance. For example, luxury and upper-upscale hotels managed to raise group ADR by 3.6% year-on-year. This suggests that hotels are not heavily discounting group rates to fill rooms; in fact, pricing for meetings and events has kept pace with or exceeded inflation. Many groups locked in rates well in advance, or elite properties are able to command higher prices despite smaller blocks. The strength in group ADR has helped offset some revenue loss from the decline in group occupancy. But ultimately, fewer groups means fewer total room nights sold, and that drag is evident in many urban markets’ weekday stats.

Corporate transient travel (individual business travelers) also remains a sore spot. Companies have been slower to restore travel budgets to full strength, and some tech and finance firms have even tightened travel policies in 2025 amid economic uncertainty. As a result, midweek occupancy in business-centric hotels is under pressure, and those that do check in often have negotiated corporate rates that cap the hotel’s revenue. The “road warrior” segment that reliably filled hotels Monday–Thursday is simply not as robust this year. Industry observers note that remote work and virtual meeting adoption permanently reduced some fraction of corporate travel, and what remains may not fully normalize for another couple of years – if ever. Hoteliers have had to adjust expectations that the high-yield business traveler will come roaring back; instead, they are focusing on leisure and bleisure (blended business-leisure) travelers to pick up the slack.

All Segments Feel the Slowdown – Especially Lower-End Hotels

No segment of the U.S. hotel market has been completely immune to the demand slowdown. All chain scales saw RevPAR decline in early July compared to a year prior. That said, the impact has been uneven. Luxury hotels experienced a modest 2% drop in RevPAR, while economy hotels saw around a 5% drop in RevPAR. The middle tiers (upper-upscale, upscale, upper-midscale, midscale) were generally down around 4% on average. This pattern continues a bifurcation trend observed in recent months: higher-end hotels are holding up slightly better than midscale and economy properties.

One reason is that wealthier travelers – the typical clientele for luxury brands – have been less affected by inflation and high airfares, so they continue to travel and spend on premium accommodations. Many luxury hotels also cater to affluent leisure travelers (for example, resorts or high-end urban hotels for weekend getaways), and that segment has shown resilience. In contrast, budget-conscious travelers are feeling the pinch of higher prices. Guests who might opt for economy or midscale hotels are more likely to curtail trips or seek alternatives when costs rise, leading to bigger drops in occupancy at the lower end of the market. Additionally, inflation in food, gas, and daily expenses disproportionately impacts middle- and lower-income households, translating to cutbacks in discretionary travel that hurt midscale and economy hotel demand.

The weekday vs. weekend dynamic also plays out across chain scales. The upper-upscale class (Marriott, Hilton, Hyatt in major cities, etc.) saw the steepest weekday RevPAR decline (~–7.6%) as noted, given their reliance on business travel. Upscale and upper-midscale hotels (like select-service brands often used by business travelers) similarly saw significant weekday drops around –6%. Economy and midscale hotels – which have a more even mix of guests – had weekday declines around 5%, slightly less severe. On weekends, the script flips somewhat: luxury hotels actually grew RevPAR by about 6.5% on weekends, and upper-upscale by ~2.6%, indicating solid leisure demand at the top end. Meanwhile, the midscale and economy segments saw weekend RevPAR flat to down a few percent, suggesting that lower-budget leisure travelers are cutting back. In upscale and upper-midscale segments, weekend RevPAR was roughly unchanged (0% growth in upscale, for instance). This divergence implies that travelers with higher incomes are continuing to take weekend trips (often staying in nicer hotels), whereas more budget-minded travelers are the ones pulling back most – or finding cheaper alternatives like private rentals. In summary, while every segment is experiencing some decline, upscale leisure is the relative bright spot and budget travel is under the most strain in the current environment.

Mixed Performance Across Major U.S. Markets

Looking at the top 25 U.S. hotel markets, most are seeing year-over-year declines in performance this summer – but a few cities are bucking the trend thanks to local events or unique demand drivers. In the week ending July 12, the majority of large markets posted lower RevPAR than a year ago, largely due to weak weekdays. However, nine markets managed to achieve RevPAR growth for that week, in some cases driven by strong weekends or one-time events. Here are some notable market highlights from early July:

St. Louis: A standout performer with RevPAR up 30.8% year-over-year. St. Louis benefitted from hosting the 10-day General Conference of the Seventh-day Adventist Church (July 3–10), which boosted group business significantly. This large convention helped St. Louis rank among the top three U.S. markets for hotel performance in six of the last eight weeks, showcasing how a single big event can lift an entire market’s metrics.
Atlanta: RevPAR grew about 6%, thanks in part to a surge of visitors over the weekend. A major draw was Beyoncé’s “Renaissance” tour concert (the “Cowboy Couture” show) which filled hotels with concertgoers. Atlanta’s leisure demand remains strong overall, helping offset softer weekday business travel.
Chicago: RevPAR up 4.2%, with growth spread across both weekdays and the weekend. Chicago saw solid summer tourism as well as some improvement in midweek group/events, indicating a modest recovery in a city that had lagged earlier.
Orange County/Anaheim: RevPAR up 4.2%, entirely driven by weekend gains. The Anaheim area continues to benefit from theme park tourism (Disneyland and others) and summer vacationers, though midweek performance was flat.
San Francisco: A tale of two extremes – weekend RevPAR jumped 35% year-over-year, one of the biggest gains nationwide, likely boosted by events or a surge in domestic leisure tourists. Yet weekday RevPAR plunged 26.5%, the second-steepest decline of any market. This reflects San Francisco’s ongoing struggles with weak business travel and perhaps fewer international visitors on weekdays. Overall, the city’s hotel recovery remains uneven, with bright spots on weekends only.
Houston: RevPAR plummeted 34%, the worst among major markets for the week. Houston sold about 110,000 fewer room nights (-20.5%) than the same week last year, in part because last year’s numbers were inflated by demand from Hurricane Beryl evacuations and recovery. With no similar event this year, Houston faced a very tough comparison, and the underlying demand in 2025 is considerably lower without that boost.
Las Vegas: Continued to see year-over-year RevPAR declines each week this summer, although its position among the top 25 is improving slightly. Vegas had an exceptionally strong 2022–23 driven by pent-up leisure and event demand, and now is coming off those highs. The return of some conventions and a fuller events calendar in the fall may help, but for now Las Vegas is tracking in the middle of the pack, a sign of normalization after the past boom.

Overall, many big urban markets like New York, Washington D.C., and Los Angeles (not listed above) have been underperforming as well, mainly due to their reliance on business and international travelers. For instance, industry data shows New York City’s hotel demand has softened in 2025 alongside a drop in international tourism. NYC officials recently downgraded their 2025 visitor forecast to 64.1 million (from 67.6M), citing an expected 17% fall in international visitors compared to prior estimates. Similarly, San Francisco and Los Angeles, which normally attract large numbers of overseas tourists, have reported slower recovery in international segments and continued weakness in certain weekdays. On the other hand, some Sunbelt and secondary markets (like Florida cities or smaller convention markets) that rely more on domestic leisure are faring better or at least holding steady. For example, Florida was the top destination for international visitors in March 2025 – a positive sign for markets like Orlando or Miami – even though nationwide inbound numbers were down (meaning Florida captured a larger share of a smaller pie).

Lagging International Arrivals Create a Travel Imbalance

A key challenge for the U.S. hospitality sector this year is the imbalance between outbound and inbound international travel. In simple terms, Americans are traveling abroad in huge numbers, while fewer international travelers are coming into the United States – and that discrepancy is hurting U.S. hotels. Recent data confirms that inbound tourism to the U.S. has stalled in 2025, even as other countries see continued recovery in cross-border travel.

According to the U.S. Department of Commerce, international visits to the U.S. fell roughly 14% in March 2025 compared to March 2024. This was the largest drop since the post-pandemic rebound began and included declines from most major source regions. Canada, Western Europe, Asia, and South America all saw fewer travelers to America than a year prior. In fact, March marked Western Europe’s first decline in U.S. visitation since 2021, indicating a notable shift. Preliminary figures for April and May hinted that the trend continued into the spring. The World Travel & Tourism Council (WTTC) reports that the U.S. is uniquely lagging: it is “the only country among 184 economies forecast to see international visitor spending decline in 2025”. The total spending by foreign visitors in the U.S. is projected at $169 billion for 2025, down from $181 billion in 2024 – and still over 22% below the pre-pandemic peak. This weakness in inbound tourism is highly unusual given the global travel resurgence.

Why are international arrivals to the U.S. slowing down? Several factors are at play. Exchange rates and costs are one: the U.S. dollar has been relatively strong, making U.S. trips more expensive for many foreigners. Also, high airfares and limited flight capacity on some routes (though improving) can be deterrents. Geopolitical and policy issues are another factor. Travel analysts point to negative perceptions around U.S. visa policies and border controls – for example, long wait times for tourist visas in countries like India and Brazil, and stricter entry rules – which may be dissuading some visitors. A recent Reuters report noted that travel from Western Europe to the U.S. has dipped in 2025 partly due to such concerns, with May arrivals from Europe down 4.4% and many Europeans reconsidering U.S. trips. Political rhetoric matters too; a change in U.S. administration with policies perceived as less welcoming to foreigners can have a chilling effect. Industry leaders have described the situation as the U.S. “putting up a ‘closed’ sign” while other countries aggressively court international tourists.

Concrete data from March 2025 underscores the breadth of the decline in inbound travel. Some of the largest drop-offs in visitors to the U.S. (year-over-year for March) include:

United Kingdom: nearly –15% fewer visitors (the UK is traditionally one of the top overseas markets for U.S. tourism).
Germany: about –28% fewer visitors, a steep plunge.
South Korea: roughly –15% decline in visitors.
Several other key markets (Spain, Colombia, Ireland, Ecuador, Dominican Republic, etc.) each saw double-digit percentage drops between 24% and 33%.
Canada: U.S. inbound travel from Canada is also shrinking. Early summer bookings from Canada to U.S. destinations were down over 20% compared to the prior year, confirming a major slowdown in the largest inbound market (Canada typically provides the greatest number of foreign visitors to the U.S., via both air and land crossings).

These lost international visits translate directly to fewer hotel nights, especially in gateway cities and tourist hotspots. Prior to the pandemic, international travelers were a lucrative segment, often staying longer and spending more per day than domestic travelers. For instance, in 2019, international visitors spent $217 billion in the U.S. and supported 18 million jobs in travel-related sectors. Today, that contribution is still greatly diminished. Industry economists estimate that international inbound arrivals account for only about 4–7% of total U.S. hotel demand (room nights). It sounds small, but in absolute terms it’s significant. If that slice erodes further, hotels notice the difference. STR and Tourism Economics projected earlier this year that a 9% drop in international arrivals in 2025 (which now seems plausible) would result in roughly 5.9 million fewer room nights sold nationwide. Each 1% decline in overseas arrivals equates to about 654,000 lost hotel room nights annually in the U.S.

Estimated impact of various declines in international inbound travel on U.S. hotel room night demand in 2025. Even with international visitors comprising a small share of total demand, a steep drop can mean millions of fewer rooms occupied.

Compounding the issue, outbound travel by Americans has surged, effectively exporting potential lodging demand that might have otherwise been spent domestically. After two years of restricted travel, Americans are making up for lost time by going abroad in record numbers. In 2024, U.S. citizens took over 107 million international trips, exceeding pre-pandemic levels. Early indicators show 2025 is on track to remain at or near these record outbound volumes. Europe, in particular, saw an influx of American tourists this summer, and destinations in the Caribbean, Mexico, and Asia also report strong U.S. visitor growth. This means that during peak vacation months, millions of Americans are spending their travel dollars overseas (on foreign hotels, tours, etc.) rather than within the U.S. The U.S. Travel Association notes an unprecedented travel trade deficit has emerged: the U.S. is now sending ~$50 billion more out via American travelers abroad than it takes in from international visitors coming here. This reversal from the historical norm (when the U.S. typically ran a surplus thanks to inbound tourism) highlights how out-of-balance the recovery has become.

For U.S. hotels, the lag in inbound international travel is acutely felt in certain markets. Big gateway cities like New York, Los Angeles, San Francisco, Miami, and Orlando generally depend heavily on foreign tourists, especially in summer. Many of these places are still missing a chunk of their usual visitors from Europe, Asia, and South America. For example, New York City officials attribute their softer tourism outlook directly to the dip in overseas visitors. On the West Coast, the absence of large tour groups from China (still down due to visa and air service issues) has impacted cities like San Francisco and Los Angeles. Even in Florida, which has performed relatively well, the lack of Canadian “snowbirds” and fewer Europeans than expected has tempered what could have been an even stronger recovery. The upshot is that U.S. hotels face a double whammy – domestic travelers have more choices (and are exercising them), while international travelers simply aren’t fully back. Until this trend reverses, it will be difficult for U.S. hotel demand to reach new highs.

Industry leaders are calling for measures to restore the U.S.’s appeal to international visitors, from ramping up visa processing capacity to promoting the U.S. abroad and easing any unnecessary travel frictions. The concern is that if the U.S. cedes too much ground, international travelers will develop new habits – traveling to other countries instead – and it could take years for the U.S. to reclaim its share of global tourism. In the meantime, hoteliers, especially in the most affected cities, must lean harder on the domestic market and get creative in attracting guests to fill the gap.

Alternative Accommodations Take a Growing Share

It’s not just international dynamics putting pressure on hotels – competition from alternative lodging is another challenge that has intensified this summer. Travelers today have a plethora of choices beyond the traditional hotel, and many are taking advantage of these options. Short-term rental platforms (like Airbnb and Vrbo), vacation rental homes, campgrounds and RV rentals, and cruise ships are all vying for the same travel dollars. Summer 2025 has underscored how these alternatives can siphon demand away from hotels.

Hotels typically see their highest occupancies in July and August, but this is also prime season for vacation rentals and camping. Families and groups often prefer renting a house at the beach or a cabin in the mountains, especially for week-long stays, which directly replaces multiple hotel room nights. According to industry research, the short-term rental sector continues to grow: AirDNA (a leading short-term rental analytics firm) projects U.S. short-term rentals will achieve 3–4% RevPAR growth each year from 2024 to 2026, reflecting robust demand for this lodging segment. Supply of rentals has expanded in many destinations, giving consumers more choices. Many travelers also perceive rentals or Airbnb stays as offering better value or more space for longer stays, which is attractive in a high-price environment.

Camping and RV travel have also remained popular after their pandemic-era boom. National parks, for instance, are reporting strong visitor numbers again this year, and those visitors often stay in campgrounds or RV parks rather than hotels. Similarly, the cruise industry has rebounded sharply in 2024–2025, with cruise lines reporting near-full ships this summer. A cruise vacation can substitute for a land-based trip that might have involved hotel stays.

The net effect is that hotels face more competition for summer vacationers’ lodging needs than ever before. This is evident in the data: even though overall traveler counts (e.g. air passenger volumes) are up, hotel occupancy is flat or down. In the first half of 2025, U.S. hotel occupancy has hovered around 1% below 2024 levels on average, despite robust travel demand – a sign that alternative accommodations are capturing the incremental growth. The impact varies by market: in destinations where home rentals are plentiful (such as coastal beach towns, mountain resort areas, or small markets with limited hotels), hotels may be seeing a more pronounced effect. Conversely, big cities with a dominant hotel presence and stricter short-term rental regulations might feel it less.

Hotels are responding by emphasizing their unique advantages – consistent quality, amenities, loyalty perks, and safety/security – to persuade travelers to stick with traditional accommodations. are also diversifying their offerings (for example, major hotel brands launching their own home rental platforms or “soft brands” of villas and apartments) to recapture some of the alternative lodging demand. Nonetheless, the trend toward alternative lodging appears here to stay, and it is most noticeable in peak leisure periods like summer. Hoteliers may need to adjust expectations for summer occupancy rates in an era when a significant share of travelers are choosing a cabin, condo, or cruise instead of a hotel.

Outlook: Cautious Optimism or Prolonged Softness?

As the hotel industry heads into the late summer and fall of 2025, a key question emerges: Have we already seen the summer peak, and what does the rest of the year hold? Historically, July is the high-water mark for U.S. hotel demand and occupancy each year. It’s likely that will be true again in 2025 – demand should crest in July – but the concern is that this peak will be lower than last year’s, and the trajectory may be downward from here. The past two weeks of data (early July) showing year-over-year declines hint that summer 2025 will finish softer than summer 2024.

Most analysts anticipate that the same headwinds observed now will persist into the fall and winter. Economic uncertainty remains a cloud over traveler behavior. Consumer confidence signals are mixed – for example, the Conference Board’s index has been pointing downward in mid-2025, while the University of Michigan’s consumer sentiment index showed an uptick recently. This inconsistency reflects an economy in flux, making people cautious. High interest rates, student loan payments resuming, or any market volatility could dampen travel spending further. On the other hand, the labor market is still solid and people continue to prioritize travel, so a collapse in demand is not expected either. It’s more likely the industry sees a gentle slowdown rather than a steep drop.

Pricing power (ADR growth) is one area to watch closely. So far in 2025, hotels have been able to keep raising rates modestly above last year’s levels, helping support RevPAR even as occupancy slips. But if demand softens further, there’s a risk that hotels will start having to cut rates or run more promotions to fill rooms – especially heading into the slower winter season. Any significant slowdown in ADR growth would squeeze hotel profitability, given rising labor and operating costs. Operators will be balancing the need to attract price-sensitive travelers against the desire to maintain rate integrity and avoid a race to the bottom. The fact that group and corporate rates have held up is encouraging, but leisure rates might see discounting if bookings don’t materialize as hoped.

On the international front, there is some hope that outbound travel fever will normalize and inbound can only improve from its current lows. If the U.S. government moves to address visa backlogs and improves the visitor experience (as industry groups are lobbying for), we could see a bump in overseas arrivals by late 2025 or early 2026. Airlines also plan to add more transatlantic and transpacific capacity which could lower fares and stimulate travel in both directions. However, these changes take time, and meaningful inbound recovery might not occur until 2026, according to some forecasts. In the meantime, U.S. hotels will rely on domestic demand to carry them. The domestic travel engine is still relatively strong – Americans are traveling, just reallocating where and how they spend – so hotels that adapt to current traveler preferences (e.g. offering more packages, targeting regional drive markets, promoting experiential stays) can still capture business.

Most forecasts for the U.S. hotel industry through the remainder of 2025 call for modest declines or at best minimal growth in RevPAR compared to last year. STR and Tourism Economics’ latest projections, for example, have been revised downward from earlier rosy scenarios, now anticipating essentially flat occupancy and low single-digit ADR gains for 2025, which in real (inflation-adjusted) terms means a slight downturn. In practical terms, hoteliers should brace for continued pressure on both demand and rates in the coming months. The phrase “more of the same” is cropping up in industry commentary – i.e., a continuation of the current soft trends rather than a sudden rebound or crash. Barring an unexpected catalyst (positive or negative), the path ahead looks like a gentle grind: incremental improvements in some weeks, disappointments in others, and overall a market that is challenging but not collapsing.

It’s worth noting that globally, the picture is brighter, which puts the U.S. situation in perspective. Hotel markets in many other countries are still in growth mode. For the same early-July week that the U.S. saw a RevPAR decline, global hotel RevPAR (excluding U.S.) was up ~2.2% year-over-year. Many regions are enjoying the fruits of reopened borders and pent-up travel demand. For instance, Japan’s hotel RevPAR was up a staggering 22% in early July (helped by a wave of both domestic and inbound travel). The U.K. saw about +7.5% RevPAR growth, with nearly all its markets up as Brits and Europeans travel freely. Canada’s hotels posted around +6.6% RevPAR growth, marking six consecutive weeks of gains, as that country benefits from a return of events and strong domestic tourism. Even markets like Spain continued a strong run with mid-single-digit increases, and Mexico has sustained positive RevPAR all year (though the pace is slowing) according to industry data. In contrast, a few countries like India, Germany, and France saw recent dips due to specific local factors (e.g. calendar shifts of holidays or events). The big picture: travel demand globally is healthy, and the U.S. is an outlier in hitting a plateau/decline in 2025. This suggests that once the U.S.-specific issues (international inbound, alternate lodging competition, etc.) are addressed or cycle through, there is no fundamental reason the U.S. hotel industry can’t get back to growth. The underlying desire to travel remains high worldwide, and the U.S. has not lost its allure permanently – but it does face some short-term corrections that need to be made to re-attract travelers and re-energize demand.

In summary, as summer peaks, U.S. hotels find themselves at an inflection point. Soft demand and shrinking RevPAR in what should be boom times signal that the industry must navigate a new post-pandemic reality: one where business travel is subdued, Americans roam abroad freely, foreign visitors trickle in slowly, and alternate accommodations siphon off customers. Hoteliers who recognize these trends are adjusting strategies – focusing on service, value, and unique experiences – to compete. The remainder of 2025 will likely require adaptability and tempered expectations. While no crisis looms on the horizon, a return to the robust growth of past summers seems unlikely in the immediate future. Instead, U.S. hotels are poised for a period of holding steady or modest declines, hoping that by 2026 a more favorable balance of demand will return. In the meantime, success will belong to those markets and properties that can capture available demand pockets (like events or upscale leisure) and differentiate themselves in a crowded travel landscape. The summer season may be soft, but it also offers lessons that can help the industry strengthen its appeal for the future.