From 20 Years to Global No. 4: The Tech Engine Behind Huazhu's Industry Leadership

How does AI Huazhu’s AI stay-in service achieve second-level response times?

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On March 18, Huazhu Group announced its full-year 2025 performance. During the reporting period, Huazhu achieved revenue of 25.3 billion yuan, a 5.9% increase year-over-year, with an adjusted net profit of 4.9 billion yuan, up 32.9%. By the end of 2025, the group operated 12,858 hotels worldwide with over 1.26 million rooms, covering 21 countries.

2025 marks Huazhu Group’s 20th anniversary. This performance reflects not only steady business growth but also the results of supply-side reforms driven by technological innovation.

A few months ago, Huazhu founder and chairman Qi Qi clearly stated at the Huazhu Partner Conference that the biggest opportunity in China’s hotel industry lies in “supply-side reform.” Amid rising labor costs, standardized service standards, and operational efficiency bottlenecks squeezing industry profits, Huazhu has charted a high-quality growth curve that outperforms industry fundamentals.

Looking at the financial report, Huazhu’s technological approach is particularly clear: leveraging AI-based in-stay services, the industry’s first unmanned front desk “Huazhanggui,” and other intelligent technologies to boost staff productivity; pioneering digital GOP cost management products for detailed control of seven major operational costs; promoting digital modeling construction modes to improve owner capital efficiency. These initiatives are transforming the hotel industry from a traditional labor-intensive sector into a modern service industry empowered by technology.

This is not just isolated technological stacking but a systematic reconstruction of industry fundamentals. It directly responds to the strategic directions in the “14th Five-Year Plan” regarding “deepening supply-side structural reforms” and “advancing digital technology empowerment,” aiming to provide a practical example for high-quality development in China’s hotel industry through efficiency revolution, experience redefinition, and industry upgrading.

Redefining service boundaries through technology, making experiences warmer

For a long time, traditional hotels have faced an unresolved contradiction: front desk staff are bogged down by tedious check-in procedures and repetitive customer inquiries, unable to focus on enhancing guest experience. Huazhu’s solution is to delegate high-frequency, repetitive mechanical tasks to machines, restoring warmth and human touch to service.

Last year, with the rapid development of large models and intelligent agents, Huazhu partnered with Tencent in September to explore AI agent service efficiency in hotels.

Within just a few months, the joint AI stay-in service has been deployed in over 3,200 Huazhu hotels. For the most complex in-stay scenarios, 38 workflows have been built to automatically handle over 70% of high-frequency inquiries, replacing human service staff.

Unlike traditional smart customer service, AI stay-in services can integrate responses based on different intent recognition. When a guest requests “a bottle of water” in the room, the system can automatically generate a work order and dispatch a robot for delivery within five seconds, without human intervention.

This end-to-end automation loop not only reduces response times from minutes to seconds but also frees customer service staff from mechanical roles, allowing them to focus on solving complex issues machines cannot handle.

This “human-machine collaboration” model is most vividly demonstrated in economy hotels. For example, in Hiyou’s fully self-service hotels, check-in, delivery, laundry, and other processes are fully handled by smart devices. Guests can complete check-in in as little as 10 seconds via self-service kiosks, solving peak-hour front desk efficiency issues, with a room-to-staff ratio dropping to 0.1. Front desk staff, freed from routine tasks, no longer need to stay behind the service desk operating computers mechanically. Instead, they can patrol the lobby with a tablet, assist families with luggage, or guide elderly guests. Such extreme efficiency allows hotels in the budget segment to maintain high service quality while leaving sufficient profit margins for franchisees, enabling scalable growth in broader markets.

Through these digital explorations and implementations, Huazhu has transformed the traditional labor-intensive hotel industry into a modern service sector.

Digital solutions unlock the “cost black box”

If technological innovation alleviates the balance between service quality and labor efficiency, Huazhu’s proprietary GOP cost management digital product acts like a “smart brain” for hotels, making invisible costs visible and controllable, and profits manageable.

In 2025, as the domestic hotel industry recovers, it also faces internal pressures. Industry profits are often eroded in unseen areas—energy waste, inflated laundry costs, material losses—every link results in real financial loss.

The GOP cost management digital system, already used in 7,763 Huazhu hotels, connects seven major operational cost modules, enabling automatic data synchronization and visualization. For example, the system can automatically compare energy consumption benchmarks with similar hotels. If a particular hotel’s per-room nightly electricity usage is abnormally high, it will trigger an alert to investigate issues like shared meters or aging equipment.

This refined management helps franchisees move away from “guesswork” in operations toward data-driven decision-making, effectively filling profit gaps in traditional management.

In capital-intensive construction phases, Huazhu’s digital modeling construction mode is like an efficiency revolution.

Traditional hotel renovations are lengthy and complex. Huazhu disassembles guest rooms into standardized modules from the design stage, with furniture dimensions and material requirements stored in the “smart brain,” enabling more efficient layout and drafting. From main materials to integrated shower rooms, many processes are prefabricated in factories, reducing lead times and ensuring precise delivery without re-measurement. Factory pre-assembly of systems like automotive-grade “photoelectric wiring” allows on-site assembly without trenching or wiring, similar to building with LEGO blocks—quick, clean, and low waste. For example, a room at Quanjing Hotel 5.0 can be completed in just 3 hours by two workers. This zero-waste, low-loss, high-efficiency approach also reduces labor costs.

This “building hotels like cars” model significantly shortens construction cycles, reducing franchisees’ capital tie-up time, lowering costs, and minimizing environmental impact.

Technological innovation is the core engine driving high-quality industry development

It’s worth noting that over the past year, the domestic hotel industry has faced structural pressures of “overcapacity and weak demand.” In this context, Huazhu’s investment in technological innovation is not only about improving individual hotel ROI but also about breaking through traditional industry efficiency limits.

By reducing construction costs through digital modeling, lowering daily operating costs with GOP management and AI stay-in services, Huazhu packages its technological capabilities into comprehensive solutions, greatly lowering barriers for non-professional investors entering the hotel industry. The high standardization and automation empower investments with greater certainty of returns, attracting more diverse capital and partners.

Huazhu’s AI-driven automation allows staff to focus on warmer, more personalized service. Coupled with high occupancy rates driven by brand strength, this enhances hotel resilience and cash flow stability, opening new valuation prospects for the industry.

Looking ahead, Huazhu’s 2025 performance can be seen as a comprehensive test of its technological innovation achievements. Behind this is a company transforming tech from a “story” into a “hardcore” capability that delivers real results.

By integrating AI and digital technologies into every aspect of hotel operations, Huazhu creates high-quality products and services for customers, tangible value for franchisees, and a replicable path for the industry’s high-quality development. In the opening year of the “14th Five-Year Plan,” Huazhu’s practices demonstrate that technology is not only a tool for cost reduction and efficiency but also a core driver for service enhancement, industry upgrading, and high-quality growth.

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