As the hospitality industry looks ahead to 2026, hotel leaders face a familiar challenge in an unfamiliar landscape: rising complexity. Artificial intelligence is no longer experimental, distribution dynamics are shifting again, and while revenues may be holding up, profitability remains under sustained pressure.
In a recent discussion for our 2026 Crystal Ball predictions series, Adnan Malik of Cloudbeds, one of our Expert Partners, highlighted three priorities he feels will separate proactive hotel operators from those merely reacting to change.
Here is the full interview and we have summarised some of the key points below.
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1. In Hospitality, Agentic AI Will Be Won or Lost on Forecast Accuracy
AI is now table stakes. The differentiator in 2026 will not be who “has AI,” but who has AI grounded in highly accurate demand forecasting. While large language models excel at communication and coordination, they are not decision engines on their own. Without a robust forecasting foundation, agentic AI risks confidently making the wrong calls – mispricing rooms, misallocating labor, or overspending on marketing.
The winning platforms will be those built on unified, causal data and precision forecasting models. When AI can accurately predict demand, it moves from being a passive system of record to an active system of action – optimizing pricing, staffing, inventory, and operations across PMS, RMS, and daily workflows. Siloed data will increasingly undermine productivity and profitability, while unified data architectures will define the next generation of hotel technology.
2. Guest Acquisition Will Be Rewritten by AI-Powered Travel Discovery
The balance between direct bookings and OTAs is shifting once again – but this time, the disruption starts even earlier in the booking journey. Travelers are increasingly turning to AI-powered platforms such as conversational search tools and AI travel assistants for trip planning. These platforms are already partnering with major OTAs, funneling visibility and demand toward intermediary channels.
For hotels, the risk is clear: losing visibility at the moment of discovery. The response must be equally clear. Maintaining a strong digital footprint is no longer just about SEO – it is about optimizing for AI discovery. Hotels must ensure their websites and listings provide structured, accurate, and consistent data that AI platforms can easily synthesize. Reputation now directly fuels discoverability; properties with strong review volume and sentiment are far more likely to be recommended by AI systems.
Direct booking is not dead – but it requires renewed focus. Authentic storytelling, accurate content, best-rate guarantees, and consistent messaging across all platforms are critical to competing in an AI-driven search environment.
3. Revenue May Be Up, but Profitability Tells a Different Story
Many hotels are reporting modest revenue growth, yet margins continue to tighten. Rising labor costs, shorter lengths of stay, and increased OTA reliance are eroding profitability. Labor alone now represents nearly half – or more – of operating costs in many regions, while guests are becoming more price-sensitive and traveling for fewer nights.
The path forward is not discounting. Instead, hotels must focus on revenue quality, not just volume. Growing ancillary revenue through experiences, F&B, spa, and activity packages can drive incremental spend while enhancing guest satisfaction. At the same time, tighter forecasting and integrated technology can help control costs through smarter scheduling, purchasing, and demand planning.
Preparing for 2026
The common thread across all three predictions is integration – of data, technology, distribution, and guest experience. Hotel leaders who invest now in accurate forecasting, AI-ready digital foundations, and operational efficiency will be better positioned to weather uncertainty and emerge stronger on the other side.
