Tourism is an important sector of the global economy that significantly contributes to national and global development. In Croatia, tourism is considered one of the most important economic branches. The hotel industry is a part of the hospitality sector that plays a key role in tourism, providing essential accommodation and food services. The subject of this paper is the analysis of the profitability of selected hotel companies in the Mediterranean. The paper analyzes companies operating in Croatia (Valamar Riviera d.d., Maistra d.d., and Arena Hospitality Group), as well as foreign companies (IHG Hotels & Resorts, PPHE Hotel Group, and Meliá Hotels International). The performance measurement of hotel companies can be conducted using common financial performance indicators as well as specific performance indicators in the hotel industry. The comparative analysis in this paper is based on selected profitability indicators – net profit margin, gross profit margin, EBITDA profit margin, return on assets (ROA), and return on equity (ROE). The aim of the paper is to provide a deeper insight into a range of factors that affect the performance and profitability of hotel companies and to compare the profitability of selected domestic and foreign hotel companies. This paper provides a detailed insight into the financial results and earning power of the selected companies, and based on the results of the analysis, guidelines are given for maintaining or increasing the earning power of the selected companies. It was found that the COVID-19 pandemic significantly affected the profitability of the selected companies. Of all the observed companies, IHG Hotels & Resorts showed the highest levels of profitability and significantly greater resilience and recovery ability after the pandemic.