Hostelworld Group (HSW) H2 2025 earnings summary

Executive summary

• Net bookings reached 7 million, up 1% year-over-year, with net revenue of EUR 93.8 million, up 2%, and significant acceleration in H2 positioning for strong 2026 momentum.

• Adjusted EBITDA was EUR 19.9 million (21% margin), in line with consensus but down from EUR 21.8 million in FY 2024 due to increased investment and higher marketing costs.

• Social network engagement surged, with 3.4 million members and 81% YoY growth in messaging; social members book twice as frequently as non-members.

• Expansion into budget accommodation and launch of Social Passes diversified revenue streams and broadened the addressable market.

• Dividend reinstated, with a total payout of EUR 0.024 per share for the year.

Financial highlights

• Net average booking value rose 2% to EUR 13.43, driven by higher commission rates and improved mix.

• Second half revenue grew 7% year-over-year, with direct marketing costs falling to 45% of revenue.

• Adjusted free cash flow was EUR 10.1 million (51% conversion), down from EUR 14.4 million (66%) in 2024, due to increased investment and working capital.

• Effective commission rates increased to 16.7% in H2 2025 from 15.4% in H2 2024.

• Marketing as a percentage of revenue was 48% for the year, within the 45%-50% guidance range.

Outlook and guidance

• Q1 2026 generated revenue up more than 12% year-over-year, with commission rates at 17.7%.

• Marketing efficiency remains within the 45%-50% range, with continued focus on scalable, asset-light growth.

• Targets reaffirmed: low double-digit revenue growth, adjusted EBITDA margin above 20%, and free cash flow conversion of ~70%.

• OccasionGenius integration on track for late Q2 2026, enhancing event-driven engagement.

• Commission rate expansion and scaling of budget accommodation and Social Passes expected to drive growth.