UPDATE 3-Hilton Worldwide 2024 profit forecast squeezed by rising expenses

(Adds investor comments in paragraph 6 and 8, quarterly expenses in 10, analyst comment in 4)

By Doyinsola Oladipo and Aishwarya Jain

Feb 7 (Reuters) - Hotel operator Hilton Worldwide on Wednesday forecast 2024 profit below market expectations on higher expenses after falling short on fourth-quarter revenue estimates despite strong occupancy levels and room rates.

Hilton and other hotel operators benefited from pent-up travel demand in the U.S. in the years following the pandemic, but now faces a switch by customers to other forms of travel such as cruises.

The company's shares were marginally down in premarket trade.

"Deceleration is natural after a few strong years of growth recovery. Travel demand has normalized not weakened," said Morningstar analyst Dan Wasiolek.

Hilton, which owns brands such as Waldorf Astoria Hotels & Resorts, expects 2024 full-year adjusted profit of between $6.80 and $6.94 per share, below analysts' expectations of $7.07, according to LSEG data.

"The market has a very high level of expectations for outlooks and is rewarding few for great earnings," said Sylvia Jablonski, chief investment officer of Defiance ETFs.

Hilton said revenue per available room, or RevPAR, an important metric in the hospitality industry, rose 5.7% in the fourth quarter from a year earlier to $107.69, led by higher occupancy levels in Asia Pacific and higher room rates in the Middle East and Africa.

The company has shown the ability to leverage its global presence and diverse brand portfolio despite the overhang from COVID and geopolitical concerns, Jablonski said.

Fourth-quarter revenue rose 6.75% to $2.61 billion, but marginally missed estimates, while adjusted per-share earnings of $1.68 were above estimates of $1.57.

Management and franchise fee revenue rose by 12.2% but total expenses jumped 13.8% to $2.2 billion.

Hilton expects 2024 revenue per room to increase between 2% and 4% compared to last year.

The company projected net unit growth to be between 5.5% and 6.0% in 2024 after adding a record 24,000 rooms in the fourth quarter.

Rival Marriott International scheduled to report its results next week. (Reporting by Aishwarya Jain and Doyinsola Oladipo in New York; editing by Milla Nissi and Sriraj Kalluvila)