Reduced travel demand in the United States has significantly affected the revenue of Expedia Group in the first quarter, according to the company’s latest report. Bank of America also reported a decrease in credit card transactions for flights and lodging last month, adding to the growing evidence that the U.S. travel and tourism industry may experience a slowdown after a period of “revenge travel” following the end of the COVID-19 pandemic.

Major companies in the travel industry, such as Airbnb, Hilton, and most major U.S. airlines, have also noted a decline in business from both domestic and international travelers. This trend has led to a pullback in economy passengers booking leisure trips and has caused these companies to adjust their financial guidance for the year.

The U.S. Travel Association attributes this decline to economic uncertainty and concerns over President Donald Trump’s tariffs. Additionally, Americans’ confidence in the economy has been steadily decreasing since April, possibly contributing to the decrease in travel bookings.

Bank of America’s credit card data also revealed that while consumers were willing to spend on “nice to have” services like dining out, they were less likely to make larger discretionary purchases, such as airfare and lodging. This could be due to declining consumer confidence and worries about the economic outlook.

In terms of international travel, experts in the tourism industry believe that anger over tariffs and concerns about tourist detentions at the U.S. border have made citizens of other countries less interested in traveling to the U.S. The U.S. government reported a 3.3% decline in overseas visitors in the first three months of the year compared to the same period in 2020.

Expedia’s Chief Financial Officer, Scott Schenkel, stated that the value of the company’s bookings into the U.S. decreased by 7% in the first quarter, with bookings from Canada experiencing an even steeper decline of nearly 30%. CEO Ariane Gorin also noted that demand for travel to the U.S. remained soft in April.

While Expedia’s revenue increased by 3% to $2.99 billion in the first quarter, it fell short of Wall Street’s expectations of $3 billion. Similarly, Airbnb reported a decline in interest for travel to the U.S., particularly from Canada, where citizens are choosing to travel domestically or to other international destinations.

Overall, the U.S. travel industry is facing challenges due to reduced demand and a shift in travel preferences among consumers. However, there has also been a “rebalancing” of travel, with Europeans showing less interest in traveling to the U.S. but increasing their travel to Latin America. With the evolving situation, companies in the travel industry will need to adapt and find ways to attract and retain customers in the current market.