The UK travel market achieved a record £56.6 billion in gross bookings in 2025, driven by strong demand and a 90% online penetration rate, according to Phocuswright's latest report. Despite this growth, the distribution landscape remains stable, with online travel agencies (OTAs) experiencing a decline in market share.

Phocuswright's research reveals that OTA gross bookings reached an all-time high of £10.3 billion in 2025. However, the OTA share of total gross bookings decreased from 22% in 2023 to 20% in 2025, with projections indicating a further drop to 19% by 2029. Conversely, supplier direct channels are expected to increase slightly from 78% to 81% over the same period.

Three companies dominate the OTA sector: Booking Holdings with 44% of OTA gross bookings, Trainline at 23%, and Expedia Group at 16%. The growth rate for OTAs has significantly slowed, dropping from 27% in 2023 to just 3% in 2025.

The hotel segment remains competitive, with supplier direct and OTA channels holding nearly equal shares at 35% and 32%, respectively. This balance is expected to remain relatively unchanged through 2029.

A potential shift in the distribution model could arise with the launch of Great British Railways in 2027, which may impact Trainline's market position by centralising fare management and ticketing.

Phocuswright's managing director, Pete Comeau, noted, "Strong demand and weakening macro conditions are not mutually exclusive, and right now the UK market has both." He highlighted the 44.7 million outbound trips by UK residents in the first half of 2025, despite a GDP forecast cut to 0.7% for 2026.

Phocuswright Europe 2026 will convene in Barcelona from 15 to 17 June, bringing together industry leaders to discuss trends shaping Europe's travel economy

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