Hilton also said it will scale back the number of hotels it originally expected to open in 2001, a reflection of the tight financing environment for new lodging projects. Wall Street reacted by sending Hilton's stock down nearly 6%.

Hilton--whose brands also include the Doubletree, Homewood Suites, Embassy Suites and Hampton Inns--is considered a bellwether for the lodging industry because it serves a broad range of customers throughout the United States and around the world. The company reported fourth-quarter earnings of $64 million, or 17 cents a share, compared to a year-earlier $25 million, or seven cents a share. Revenue totaled $875 million, a 7% gain from a year earlier.

The hotelier's 17-cents-a-share quarterly profit matched the consensus among analysts polled by financial-services firm First Call/Thomson Financial. Hilton officials said revenues generated by the average hotel room, or "revpar," in industry parlance, grew a healthy 7.4% in the latest quarter despite bad weather that hurt business and leisure travel in many parts of the nation.

However, Hilton CFO Matt Hart said in a conference call with reporters and analysts that the slowing economy would likely keep revpar growth to a more modest 3% or 4% this year. "I would say we're taking our best estimate of things," Hart said. "It's trying to be a little conservative."

The company also says it will scale back the number of new hotels it plans for 2001. It now expects to add another 190 to 200 hotels with 25,000 to 27,000 rooms. Though that's a reduction from its earlier forecasts, it would still top the 170 hotels and 23,531 rooms the company added last year.

Wall Street reacted quickly, sending Hilton's stock down nearly 6%. It closed at $11.50 a share Wednesday, down from $12.18 the day before.