Travel companies are signaling a slowdown in US tourism as fewer European and Canadian travelers head to the country. According to recent reports, 7.1 million visitors entered the US from overseas in the first three months of 2025, representing a 3.3% drop compared to the same period in 2024.
Expedia Group reported a weaker-than-expected revenue in Q1 due to reduced travel demand in the US. Similarly, Bank of America noted a decline in spending on flights and lodging, with credit card transactions showing continued weakness in the sector.
These trends suggest the US travel and tourism industry may be facing its first downturn since the end of the COVID-19 pandemic, which had sparked a period of “revenge travel” that fueled consistent interest in vacations. Expedia, which owns brands like Hotels.com and VRBO, followed in the footsteps of other companies like Airbnb and Hilton, which also reported declining international and domestic travel numbers last week.
Major US airlines are planning to cut back on scheduled flights, citing a drop in economy passengers booking leisure trips. The US Travel Association has pointed to economic uncertainty and President Donald Trump’s tariffs as potential factors behind this pullback. Bank of America further explained that despite spending on “nice to have” services like dining out, consumers are scaling back on discretionary purchases for airfare and lodging, possibly due to declining consumer confidence.
Abroad, the US’s tariffs and concerns about tourist detentions at the border have contributed to reduced interest in US travel. In particular, both US and Canadian data show sharp declines in border crossings from Canada, partly driven by negative reactions to Trump’s rhetoric about making Canada the “51st state.”
Expedia’s Chief Financial Officer Scott Schenkel reported a 7% drop in the net value of bookings to the US during the January-March period, with bookings from Canada down nearly 30%. CEO Ariane Gorin acknowledged that demand for US travel had also weakened in April compared to March, with Europeans shifting their focus to Latin America. Airbnb’s CFO, Ellie Mertz, pointed out that Canadians, in particular, are traveling less to the US and opting for destinations like Mexico, Brazil, France, and Japan instead.
Despite these challenges, Hilton’s President and CEO, Christopher Nassetta, remains optimistic about the second half of the year, anticipating that some of the current uncertainty will ease and that the strength of the economy will eventually lead to recovery in travel demand.
