(Oct 12): A surge in travel fuelled by Taiwan’s artificial intelligence (AI) boom is driving record results at Formosa International Hotels Corp, highlighting the technology sector’s growing impact beyond the island’s chip industry.

The company, led by hospitality tycoon Steven Pan, is on track for record revenue and profit this year, he said in an interview at the Forbes Global CEO Conference in Singapore on Thursday. Room revenue has increased 10% year-to-date, while sales at its luxury retail business have jumped 20% due to the AI boom, he said, declining to provide specific figures. 

“What it means for the hotel industry is a tremendous increase in business travel because people have to come and buy stuff from Taiwan, make deals in Taiwan,” Pan said. 

Beyond corporate travel, demand for luxury retail business is being driven largely by newly affluent domestic customers, whose spending power has been boosted by strong economic growth and a surging stock market, he added. 

Taiwan raised its economic growth forecast for the year to more than 10%, putting the island on track for its first double-digit expansion since 2010 as demand tied to AI continues to fuel the chip hub’s economy. The upgraded outlook follows growth of 8.76% last year.

The AI-driven boom has also made Taiwan a standout destination for equity investors. Taiwan’s benchmark stock index has surged more than 70% this year, making it the top performer among more than 90 equity gauges tracked by Bloomberg.

International luxury hotel operators are expanding their presence in Taiwan, including InterContinental, which opened a new hotel in Taipei this month.

Pan plans to open two hotels next year in Linkou, a district in New Taipei City he describes as a future technology hub, as companies including ASML Holding NV and Micron Technology Inc expand their presence in the area. He is also looking to buy a luxury hotel in San Francisco, another tech hub. 

“We are looking at undervalued luxury hotels in major gateway cities in America,” Pan said, declining to comment on the deal size. The group also plans to open two hotels in Japan next year.

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