Hostelworld Group (HSW) H1 2025 earnings summary

Executive summary

• Net bookings and net revenue were flat year-over-year at 3.7 million and €46.7 million, with growth resuming from late May and continuing into July.

• Adjusted EBITDA declined 23% to €7.4 million, reflecting higher marketing costs and margin contraction.

• Social network engagement surged, with 85% of bookings from social members, a 42% increase in messages sent, and app bookings up 11% year-over-year, now representing about 50% of total bookings.

• Strategic initiatives, including the Elevate marketplace tool and social network expansion, are driving higher commission rates and engagement, with Elevate increasing blended commission rates to 15.8%.

• Progressive dividend policy reinstated and a £5 million share buyback programme launched, with interim dividend of €0.82 per share declared.

Financial highlights

• Net revenue for H1 2025 was €46.7 million (flat year-on-year); net bookings were 3.7 million (flat year-on-year); net ABV declined 1% to €13.40.

• Adjusted EBITDA was €7.4 million (down from €9.6 million in H1 2024), with a margin of 15–16%.

• Net margin contracted to €19.8 million, mainly due to higher paid marketing costs.

• Direct marketing costs rose to 51% of revenue (H1 2024: 45%) due to Q1 cost inflation.

• Cash balance at 30 June 2025 was €11.0 million, with net cash of €6.1 million.

Outlook and guidance

• Full-year 2025 guidance reaffirmed: mid single-digit net revenue growth, adjusted EBITDA margin around 20%, and marketing as a percentage of revenue within 45–50%.

• Deferred revenue from Free Cancellation product expected to unwind in H2.

• Board remains confident in differentiated growth strategy and expects continued momentum into H2 and 2026.