The lodging industry has undergone some noticeable changes over the past two decades due to rapid advancements in Information Technologies (IT). While previous research demonstrated IT’s impact on various aspects of the lodging industry, there have been inconsistent findings regarding the impact of IT expenditure on performance. Aiming to enhance the current understanding of how IT spending influences financial performance in hotels, this study employs a production function analysis and incorporates comprehensive and up-to-date property-level hotel data from the US. The results demonstrate a significantly positive impact of IT expenditure on the hotel’s total revenue. The findings reveal that the gross marginal product for IT expenditure is $3.14 from 2016 to 2018. It means on average, each additional dollar spent on IT can lead to an increase of $3.14 in hotel revenue across these three years. Furthermore, the marginal product of IT expenditure shows a significant upward trend on an annual basis. This study highlights the importance of recognizing IT’s potential to enhance financial performance and maintain competitiveness in the contemporary business environment.