Introduction

Phocuswright's Travel Forward: Data, Insights and Trends for 2026, sponsored by Travel Guard, provides broadscale insights into the $1.67 trillion global travel market, offering essential data for understanding industry trends and growth.

Featuring highlights by segment, channel, consumer behavior metrics and more, this report equips industry stakeholders with the key data and trends needed to navigate the rapidly evolving travel landscape. Please note that all market sizing data for 2025 and 2026 is projected.

For more in-depth analysis and data including longer-term predictions, become an Open Access subscriber to use our Phocal Point market sizing data tool and to access all reports in the Phocuswright Research library.

Global sizing

Global travel continued its upward trajectory in 2025, with total gross bookings projected to reach $1.67 trillion, extending the industry’s recovery beyond pre-pandemic benchmarks. While growth has moderated from the surge of 2023–24, demand remains robust across nearly all regions and sectors. The rebound in international travel, led by record outbound flows from Asia Pacific and sustained strength in Europe and the Americas, underscores travel’s enduring appeal amid global uncertainty. Despite inflationary pressures, high interest rates and geopolitical tensions, leisure and corporate travelers alike continue to prioritize experiences over possessions—keeping travel firmly on a growth path and cementing its role as one of the world’s most dynamic consumer sectors.

2025 Projected Travel Bookings by Region and Country

Global and Regional Gross Travel Bookings, 2022-2026

Regional sizing

The global travel industry entered 2025 in a position of renewed strength, but also under the weight of forces reshaping its trajectory. Travel & tourism is on track to generate more than $11.7 trillion in global GDP in 2025, accounting for roughly one in every 10 dollars spent worldwide, and supporting nearly 371 million jobs. International visitor spending is projected to climb to a record $2.1 trillion, finally surpassing its pre-pandemic peak. Yet the rebound remains uneven: North America and Europe are stabilizing after two years of expansion, Asia Pacific continues to lead global growth and emerging markets in Latin America and the Middle East are accelerating from a smaller base. The sector’s resilience is unmistakable—but so too are the structural shifts now shaping its future, from digital transformation and sustainability imperatives to evolving consumer expectations and policy realignments.

Regional Share of Global Travel Bookings by Channel, 2025 (OTA, Supplier-Direct Online, Offline)

Digital travel adoption accelerates worldwide: Online bookings are projected to rise 8% in 2025 to $1.07 trillion, as consumers continue shifting from offline to digital channels. APAC leads global online growth, accounting for 36% of all OTA sales, while online supplier-direct bookings dominate in Europe and North America maintains a balanced channel mix. Emerging regions such as Latin America and the Middle East are expanding rapidly, underscoring how digitalization is reshaping the global travel marketplace.

Gross Travel Bookings (US$B) by Channel, 2022-2026

Country sizing

The U.S. remains the world’s largest travel market at $506.8 billion in 2025, though growth has slowed as expansion in APAC and emerging economies accelerates. China and Japan hold the next two positions, with Japan’s nearly 10% surge marking one of the year’s strongest rebounds. In Europe, Germany, the U.K. and France continue to anchor regional demand, while the U.A.E., India and Saudi Arabia lead gains across the Middle East and Asia. Rapid double-digit growth in Brazil, Mexico and Russia highlights the shifting global balance, as rising markets account for a growing share of both total and online travel bookings.

Leading Travel Markets (US$B), 2019-2026

Leading Travel Markets, 2025

As of the second half of 2025 (2H25), over half of active U.S. travelers (58%) are using AI for something and 39% are using it for travel, utilizing tools like ChatGPT, Google Gemini or AI-enabled search engines to research and plan their trips. As of the first half of the year (1H25), more than one in five U.K. travelers were doing the same, while those in France and Germany lagged below 20%.

Travel has seen disruption before—the rise of the web, mobile, social media and the sharing economy—but what’s happening now feels bigger. This is the beginning of the era of autonomous agents. Enabled by generative AI and digital identity, these platforms increasingly support planning, negotiate, purchase and personalize on behalf of travelers and businesses. While still evolving, this trajectory points to a fundamental change in booking dynamics and decision-making authority.

Travelers Who Used AI for Planning or Experiencing Trips in the Past 12 Months

It’s not the youngest travelers driving this trend; it’s the busiest. Millennials, balancing time and budgets, are leaning on AI to cut through information overload. In fact, 58% of U.S. millennials have used AI for trip planning, compared to 45% of Gen Z and just 11% of baby boomers. For millennials, AI is less about novelty and more about efficiency.

This growing reliance on AI is changing how travelers research and select trip components. Search engines, once dominant, are losing ground, dropping from 51% in late 2024 to 36% by the second half of 2025. Travel review websites also declined, while generative AI platforms surged from 6% to 15%. Social networks have held steady and even gained slightly, moving from 16% in late 2023 to 19% in 2025. Travelers are shifting away from static sources toward dynamic, personalized tools.

U.S. Travelers Who Used AI to Research and Plan Trips, by Generation, 2H25

Key Online Resources Used by U.S. Travelers to Research and Select Travel Components, 2H23-2H25

Use of Social Networks in Trip Planning

More or Much More Comfortable to a Year Ago, Among U.S. Travelers Who Used AI for Leisure Trips, 2H25

Strongly Agree/Agree With Statement Regarding Gen AI in Leisure Travel, 1H25

The rise of social networks is particularly telling. While Gen Z hasn’t fully embraced generative AI, they are highly active on social platforms, using them at rates comparable to general search engines. This points to a preference for peer-authentic voices over algorithmic recommendations. Across markets, social network usage for trip research is climbing: In the U.S., it rose from 16% in 2023 to 19% in 2025, with similar upward trends in the U.K. and Germany.

Taken together, these trends reveal a fragmented but evolving landscape. AI is becoming a mainstream planning tool, especially for time-strapped millennials, while social networks remain influential among younger travelers seeking authenticity. Generative AI promises efficiency and personalization, but social platforms deliver community and trust—qualities that algorithms alone cannot replicate.

A quarter to a third of travelers across geographies are already interested in booking travel within a gen AI platform or letting an AI assistant (like ChatGPT’s Operator or Google’s Project Mariner) book for them. E-commerce is just starting to be implemented in gen AI products, but travel is complex and has a long way to go.

Ways Travelers Define Travel Loyalty, Overall and by Generation

Despite these broader definitions of loyalty, behavior tells a more nuanced story. Enrollment may be high, but consistent use is far less common. Travelers often keep multiple options in play, shifting between brands and channels depending on trip type, timing or perceived value. This dynamic appears clearly when we look at how often people actually rely on a single “go-to” choice.

Travelers With Go-To Brands

This gap between intention and action has implications for how programs influence behavior. Even when travelers maintain a preferred brand, their loyalty is continually tested by price, convenience and trip context. Where loyalty delivers its strongest pull is at the moment of value realization—especially when rewards translate into meaningful benefits.

Generational Engagement and Attitudes Around Loyalty Programs

These shifts in loyalty set the stage for one of the most influential traveler segments in 2025: those at the high end of the market. Their behaviors amplify many of the same dynamics with far greater stakes for suppliers and brands.

Luxury

Luxury travel is characterized by travelers who spend more, travel more and approach each trip with elevated expectations. These “indulgent explorers” represent a relatively small share of the market, yet their outsized contribution makes them a critical audience for loyalty and product strategy. They lean into premium experiences, rely heavily on trusted expertise and expect a level of personalization that moves beyond standard elite benefits. At the same time, they prize variety and seek out new destinations, creating a tension between their desire for recognition and their appetite for discovery. Understanding how these travelers choose, book and evaluate experiences is central to capturing growth in the year ahead.

Indulgent explorers want to see the world and are taking the time to do it.

High-spend travelers lean heavily on expert guidance. Indulgent explorers frequently turn to travel advisors to navigate complex itineraries, secure premium inventory and ensure a seamless planning experience. Their reliance on professional support highlights a core truth about luxury travel: When expectations rise, trusted expertise matters as much as convenience. Advisors remain integral to this segment’s decision-making and booking patterns.

Offline resources have greater appeal for indulgent explorers.

Despite their preference for high-touch service, indulgent explorers are also strong adopters of travel technology and loyalty programs. They embrace tools that streamline planning, personalize recommendations and reward their spend. The dual behavior of seeking human insight while maximizing digital utility signals that luxury travelers expect both modern functionality and elevated service. Programs and platforms that deliver on both fronts stand to capture disproportionate share.

Top Booking Channels

Together, these patterns reveal a segment that is motivated, selective and highly engaged. Luxury travelers blend digital fluency with a desire for expert support as they pursue richer, more expansive travel experiences.

U.S. Corporate Travel Market Gross Bookings (US$M) and YoY Change (%), 2024-2026

Policy meets personalization

Travel managers are tightening rules while giving travelers more say. About 63% of business travelers operate under a managed policy, and one in four companies have recently made their policies more restrictive. Yet compliance isn’t universal; nearly 20% of bookings fall outside policy, mainly for convenience, lower prices or loyalty perks.

U.S. Business Travel Bookings Channel Share, 2024, Air and Hotel

AI becomes the assistant

Artificial intelligence has become the quiet disruptor behind every itinerary. More than half of business travelers use AI for travel, from inspiration to booking and rebooking. Booking tools are integrating AI for real-time support, while finance platforms use it to audit receipts and flag anomalies. Expense management is next in line for automation: Tools like Ramp and Navan forecast that AI agents will approve or reject claims by 2026, turning finance into a live system of parallel digital reviewers.

Generative AI Uses Among Business Travelers

The new economics of payment

Used by 45% of managed travelers, corporate cards remain the backbone of managed travel, while 42% of unmanaged travelers still pay personally and get reimbursed. The use of virtual cards by managed travelers has slipped to 26%, down from 36% in 2019, as companies consolidate payments within integrated booking-expense systems.

Business Travel Payment Process, by Type of Travel Program

Corporate travel is being rebuilt around the agentic traveler, guided by AI, framed by policy and powered by data. The winners in this next phase will integrate automation with empathy, delivering compliance without constraint, personalization without friction and productivity without burnout.

Further reading: The corporate travel conversation

For more on how technology, policy and business traveler behavior are reshaping the corporate travel landscape, explore recent PhocusWire coverage below.

Free webinar that uncovers all of the insights

Thu, Jan 15, 2026 11:00 AM EST

Join Phocuswright analysts for this free webinar where they'll unpack the essential insights from our report, Travel Forward: Data, Insights and Trends for 2026. They'll share key findings about the $1.67 trillion global travel market and the forces shaping where the industry is headed. 

The Phocuswright team will break down global and regional market sizing, examine how U.S. and European travelers are planning and booking trips and dig into the shifting dynamics of the short-term rental sector. They will also highlight fresh data on how consumers are using AI for travel as well as our research on corporate travel, loyalty, luxury and the startup ecosystem.