<PAGE>

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

(Mark One)

[X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

For the quarterly period ended April 2, 2004

                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

for the transition period from __________________ to ___________________

Commission File number 1-13486

                          JOHN Q. HAMMONS HOTELS, INC.
             (Exact name of registrant as specified in its charter)

                   DELAWARE                                     43-1695093
(State or other jurisdiction of incorporation                  (IRS Employer
               or organization)                             Identification No.)

                           300 JOHN Q. HAMMONS PARKWAY
                                    SUITE 900
                              SPRINGFIELD, MO 65806
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (417) 864-4300
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

Yes [X]          No [ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

Yes [ ]          No [X]

Number of shares of Registrant's Class A Common Stock outstanding as of May 12,
2004: 4,840,379
<PAGE>
PART I - FINANCIAL INFORMATION
         Item 1.  Financial Statements

                          JOHN Q. HAMMONS HOTELS, INC.
                                  AND COMPANIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (000's omitted)

                                     ASSETS

<TABLE>
<CAPTION>
                                                                                APRIL 2, 2004      JANUARY 2, 2004
                                                                                -------------      ---------------
                                                                                 (unaudited)
<S>                                                                             <C>                <C>
CURRENT ASSETS:

    Cash and equivalents                                                        $      42,947      $        23,790

    Restricted cash                                                                     1,722                1,268

    Marketable securities                                                              15,581               15,711

    Receivables:
      Trade, less allowance for doubtful accounts of $231                              11,463                7,214
      Other                                                                               221                  251
      Management fees - related party                                                     330                  223

    Inventories                                                                         1,149                1,067

    Prepaid expenses and other                                                          2,282                4,498
                                                                                -------------      ---------------

      Total current assets                                                             75,695               54,022
                                                                                -------------      ---------------

PROPERTY AND EQUIPMENT, at cost:
    Land and improvements                                                              62,783               62,779
    Buildings and improvements                                                        742,807              742,807
    Furniture, fixture and equipment                                                  339,289              338,833
    Construction in progress                                                            2,408                   75
                                                                                -------------      ---------------

                                                                                    1,147,287            1,144,494

    Less-accumulated depreciation and amortization                                   (430,453)            (418,509)
                                                                                -------------      ---------------

                                                                                      716,834              725,985

DEFERRED FINANCING COSTS, FRANCHISE FEES AND OTHER, net,
    including $21,816 and $20,453 of restricted cash as of April 2, 2004 and
    January 2, 2004, respectively                                                      42,930               42,176
                                                                                -------------      ---------------

TOTAL ASSETS                                                                    $     835,459      $       822,183
                                                                                =============      ===============
</TABLE>

            See Notes to Condensed Consolidated Financial Statements

                                       2

<PAGE>

                          JOHN Q. HAMMONS HOTELS, INC.
                                  AND COMPANIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                       (000's omitted, except share data)

                        LIABILITIES AND EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                                                   APRIL 2, 2004       JANUARY 2, 2004
                                                                                   -------------       ---------------
                                                                                    (unaudited)
<S>                                                                                <C>                 <C>
LIABILITIES:

    Current portion of long-term debt                                              $       7,338       $         7,423

    Accounts payable                                                                       3,325                 5,028

    Accrued expenses:
      Payroll and related benefits                                                         7,144                 7,776
      Sales and property taxes                                                            12,357                12,077
      Insurance                                                                            2,028                 2,646
      Interest                                                                            17,233                 6,218
      Utilities, franchise fees and other                                                  9,721                 7,298
                                                                                   -------------       ---------------
         Total current liabilities                                                        59,146                48,466

    Long-term debt                                                                       771,602               773,649
    Other obligations                                                                      2,652                 2,530
                                                                                   -------------       ---------------
         Total liabilities                                                               833,400               824,645
                                                                                   -------------       ---------------

COMMITMENTS AND CONTINGENCIES

MINORITY INTEREST OF HOLDERS OF LIMITED
    PARTNER UNITS                                                                              -                     -
                                                                                   -------------       ---------------

STOCKHOLDERS' EQUITY (DEFICIT):
    Preferred Stock, $.01 par value, 2,000,000 shares
      authorized, none outstanding                                                             -                     -
    Class A Common Stock, $.01 par value, 40,000,000 shares authorized at April
      2, 2004, and January 2, 2004, 6,042,000 shares issued at April 2, 2004,
      and January 2, 2004, and 4,837,879 and 4,808,879 shares outstanding at
      April 2, 2004, and January 2, 2004, respectively                                        60                    60
    Class B Common Stock, $.01 par value, 1,000,000 shares authorized, 294,100
      shares issued and outstanding                                                            3                     3
    Paid-in capital                                                                       96,433                96,395
    Accumulated deficit, net                                                             (89,012)              (93,361)
    Less: Treasury Stock, at cost; 1,204,121 and 1,233,121 shares at
      April 2, 2004, and January 2, 2004, respectively                                    (5,451)               (5,582)
    Accumulated other comprehensive income                                                    26                    23
                                                                                   -------------       ---------------

         Total stockholders' equity (deficit)                                              2,059                (2,462)
                                                                                   -------------       ---------------

TOTAL LIABILITIES AND EQUITY (DEFICIT)                                             $     835,459       $       822,183
                                                                                   =============       ===============
</TABLE>

            See Notes to Condensed Consolidated Financial Statements

                                       3

<PAGE>

                          JOHN Q. HAMMONS HOTELS, INC.
                                  AND COMPANIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)
                       (000'S omitted, except share data)

<TABLE>
<CAPTION>
                                                                                           THREE MONTHS ENDED
                                                                                   APRIL 2, 2004       APRIL 4, 2003
                                                                                   -------------       -------------
<S>                                                                                <C>                 <C>
REVENUES:
    Rooms                                                                          $      70,188       $      67,403
    Food and beverage                                                                     30,074              29,139
    Meeting room rental, related party management fee and other                           14,114              13,588
                                                                                   -------------       -------------
      Total revenues                                                                     114,376             110,130

OPERATING EXPENSES:
    Direct operating costs and expenses:
      Rooms                                                                               17,284              16,280
      Food and beverage                                                                   22,136              21,906
      Other                                                                                  616                 692

    General, administrative, sales and management service expenses                        36,357              36,075

    Repairs and maintenance                                                                4,706               4,453

    Depreciation and amortization                                                         11,931              12,481
                                                                                   -------------       -------------

      Total operating expenses                                                            93,030              91,887
                                                                                   -------------       -------------

INCOME FROM OPERATIONS                                                                    21,346              18,243

OTHER INCOME (EXPENSE):
    Other income                                                                               -                 175
    Interest expense and amortization of deferred financing fees, net of $118
      and $178 of interest income in April 2, 2004 and April 4, 2003,
      respectively                                                                       (16,967)            (17,433)
                                                                                   -------------       -------------
INCOME BEFORE MINORITY INTEREST AND PROVISION FOR
    INCOME TAXES                                                                           4,379                 985
    Minority interest in income of partnership                                                 -                (748)
                                                                                   -------------       -------------

INCOME BEFORE PROVISION FOR INCOME TAXES                                                   4,379                 237
    Provision for income taxes                                                               (30)                (30)
                                                                                   -------------       -------------

NET INCOME ALLOCABLE TO THE COMPANY                                                $       4,349       $         207
                                                                                   =============       =============
BASIC EARNINGS PER SHARE:
    Net earnings allocable to Company                                              $        0.85       $        0.04
                                                                                   =============       =============

BASIC WEIGHTED AVERAGE SHARES OUTSTANDING                                              5,111,270           5,083,829
                                                                                   =============       =============
DILUTED EARNINGS PER SHARE:
    Net earnings allocable to Company                                              $        0.74       $        0.04
                                                                                   =============       =============

DILUTED  WEIGHTED AVERAGE SHARES OUTSTANDING                                           5,856,746           5,151,081
                                                                                   =============       =============
</TABLE>

            See Notes to Condensed Consolidated Financial Statements

                                       4

<PAGE>

                          JOHN Q. HAMMONS HOTELS, INC.
                                  AND COMPANIES
        CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN MINORITY INTEREST
                       AND STOCKHOLDERS' EQUITY (DEFICIT)
                                 (000's omitted)

<TABLE>
<CAPTION>
                                                                           STOCKHOLDERS' EQUITY (DEFICIT)
                                                      ---------------------------------------------------------------------------
                                                                                                           Accumulated
                                                      Class A  Class B             Company                    Other
                             Comprehensive  Minority  Common    Common  Paid in  Accumulated   Treasury   Comprehensive
                                Income      Interest   Stock    Stock   Capital    Deficit       Stock        Income      Total
                             -------------  --------  -------  -------  -------  -----------   --------   -------------  --------
<S>                          <C>            <C>       <C>      <C>      <C>      <C>           <C>        <C>            <C>
BALANCE, January 2, 2004                    $      -  $    60  $     3  $96,395  $   (93,361)  $ (5,582)  $          23   (2,462)
Net income allocable to the
  Company                    $       4,349         -        -        -        -        4,349          -               -    4,349
Issuance of Common Stock to
  employees                                        -        -        -       38            -        131               -      169
Unrealized appreciation on
  marketable securities                  3         -        -        -        -            -          -               3        3
                             -------------  --------  -------  -------  -------  -----------   --------   -------------  -------
                             $       4,352
                             =============
BALANCE, April 2, 2004                      $      -  $    60  $     3  $96,433  $   (89,012)  $ (5,451)  $          26  $ 2,059
    (unaudited)                             ========  =======  =======  =======  ===========   ========   =============  =======
</TABLE>

            See Notes to Condensed Consolidated Financial Statements

                                       5

<PAGE>

                          JOHN Q. HAMMONS HOTELS, INC.
                                  AND COMPANIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
                                 (000's omitted)

<TABLE>
<CAPTION>
                                                                                        THREE MONTHS ENDED
                                                                                APRIL 2, 2004       APRIL 4, 2003
                                                                                -------------       -------------
<S>                                                                             <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income allocable to the Company                                             $       4,349       $         207

Adjustment to reconcile net income to cash provided by operating activities:
        Minority interest in earnings of partnership                                        -                 748
        Depreciation, amortization and loan cost amortization                          12,376              12,954

Changes in certain assets and liabilities
        Restricted cash                                                                  (454)               (567)
        Receivables                                                                    (4,326)             (1,419)
        Inventories                                                                       (82)                (14)
        Prepaid expenses and other                                                      2,216               2,018
        Accounts payable                                                               (1,703)             (2,310)
        Accrued expenses                                                               12,468              11,949
        Other obligations                                                                 122                  85
                                                                                -------------       -------------
              Net cash provided by operating activities                                24,966              23,651
                                                                                -------------       -------------

CASH FLOWS FROM INVESTING ACTIVITIES
        Additions to property and equipment                                            (2,618)             (3,056)
        Franchise fees, long-term restricted cash and other                            (1,361)             (1,529)
        Sale of marketable securities                                                     133               1,034
                                                                                -------------       -------------
              Net cash used in investing activities                                    (3,846)             (3,551)
                                                                                -------------       -------------

CASH FLOWS FROM FINANCING ACTIVITIES
        Proceeds from issuance of Treasury Stock                                          169                   -
        Repayments of debt                                                             (2,132)             (1,920)
                                                                                -------------       -------------
              Net cash used in financing activities                                    (1,963)             (1,920)
                                                                                -------------       -------------
              Increase in cash and equivalents                                         19,157              18,180

CASH AND EQUIVALENTS, beginning of period                                              23,790              21,774
                                                                                -------------       -------------
CASH AND EQUIVALENTS, end of period                                             $      42,947       $      39,954
                                                                                =============       =============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
CASH PAID FOR INTEREST                                                          $       5,648       $       6,073
                                                                                =============       =============

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:
UNREALIZED APPRECIATION OF MARKETABLE SECURITIES                                $           3       $           4
                                                                                =============       =============
</TABLE>

            See Notes to Condensed Consolidated Financial Statements

                                       6

<PAGE>

                   JOHN Q. HAMMONS HOTELS, INC. AND COMPANIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.    ENTITY MATTERS

The accompanying consolidated financial statements include the accounts of John
Q. Hammons Hotels, Inc. and John Q. Hammons Hotels, L.P. and subsidiaries
(collectively the Company or, as the context may require, John Q. Hammons
Hotels, Inc. only).

We were incorporated in September 1994 and had no operations or assets prior to
our initial public offering of Class A Common Stock in November 1994.
Immediately prior to the initial public offering, Mr. John Q. Hammons
contributed approximately $5 million in cash to us in exchange for 294,100
shares of Class B Common Stock (which represented approximately 72% of the
voting control). We contributed the approximate $96 million of net proceeds from
our Class A and Class B Common Stock offerings to John Q. Hammons Hotels, L.P.,
or the Partnership, in exchange for an approximately 28% general partnership
interest. As of April 2, 2004, the Partnership had redeemed approximately 1.25
million Partnership units, net of shares issued. The number of net Partnership
units redeemed is equivalent to the number of net shares we have redeemed, as
required by the Partnership agreement. Accordingly, the allocation percentages
were approximately 24% for us, and approximately 76% for the limited partners in
2004 and 2003.

All significant balances and transactions between the entities and properties
have been eliminated.

2.    GENERAL

The accompanying unaudited interim financial statements have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission
for reporting on Form 10-Q. Accordingly, certain information and footnotes
required by the accounting principles generally accepted in the United States
for complete financial statements have been omitted. Interim results may not be
indicative of fiscal year performance because of seasonal and other factors.
These interim statements should be read in conjunction with the financial
statements and notes thereto included in our Form 10-K for the fiscal year ended
January 2, 2004, which included financial statements for the fiscal years ended
January 2, 2004, January 3, 2003 and December 28, 2001.

The information contained herein reflects all normal and recurring adjustments
which, in the opinion of management, are necessary for a fair presentation of
the results of operations and financial position for the interim periods.

                                       7

<PAGE>

We consider all operating cash accounts and money market investments with an
original maturity of three months or less to be cash equivalents. Restricted
cash is escrowed for insurance, taxes, capital expenditures and certain other
obligations, in accordance with specific loan covenants and franchise
agreements. Marketable securities consist of available-for-sale commercial paper
and governmental agency obligations which mature or will be available for use in
operations in 2004. These securities are valued at current market value. As of
April 2, 2004, unrealized holding gains were approximately $26,000, all of which
is allocable to us (with no allocation to the minority interest), and are
included as a separate component of shareholders' equity until realized.

The provision for income taxes was determined using an effective income tax rate
of approximately 5% to provide for estimated state, local and franchise taxes.

      3.    NET INCOME AND EARNINGS PER SHARE

Basic earnings per share for the three months ended April 2, 2004 were $0.85,
compared to earnings per share of $0.04 for the three months ended April 4,
2003. Net income for the 2004 three months was $4.3 million, compared to net
income of $0.2 million for the 2003 quarter. In the 2004 three months $3.3
million of the income represents the recapture of the limited partner's losses
absorbed by the general partner in the fourth quarter of 2003. An additional
$0.5 million must be recaptured before the limited partner can be allocated
future earnings in minority interest.

Basic earnings per share are computed by dividing net income by the weighted
average number of common shares outstanding during the period. Diluted earnings
per share are computed similar to basic except the denominator is increased to
include the number of additional common shares that would have been outstanding
if potentially dilutive common shares had been issued.

The following is a reconciliation of the numerator and denominator for basic and
diluted earnings per share for the three months ended April 2, 2004 and April 4,
2003:

<TABLE>
<CAPTION>
                                                          Three Months Ended April 2, 2004
                                                          --------------------------------
                                                        (in thousands, except per share data)
                                                       Income           Shares         Per Share
                                                     (Numerator)    (Denominator)        Amount
                                                     -----------    ------------       ----------
<S>                                                  <C>            <C>                <C>
Basic earnings per share                             $     4,349        5,111          $     0.85
                                                                                       ==========
Effect of dilutive securities:
     Options                                                   -          746

                                                     -----------        -----
Diluted earnings per share                           $     4,349        5,857          $     0.74
                                                     ===========        =====          ==========
</TABLE>

                                       8

<PAGE>

<TABLE>
<CAPTION>
                                                          Three Months Ended April 4, 2003
                                                          --------------------------------
                                                        (in thousands, except per share data)
                                                       Income           Shares         Per Share
                                                     (Numerator)    (Denominator)        Amount
                                                     -----------    ------------       ----------
<S>                                                  <C>            <C>                <C>
Basic earnings per share                             $       207        5,084          $     0.04
                                                                                       ==========

Effect of dilutive securities:
     Options                                                   -           67
                                                     -----------        -----

Diluted earnings per share                           $       207        5,151          $     0.04
                                                     ===========        =====          ==========
</TABLE>

As of April 2, 2004 we had no antidilutive options. As of April 4, 2003, options
for 813,700 shares were not included in the computation of diluted earnings per
share since the options would be antidilutive.

4.    STOCK OPTIONS

We account for our stock-based compensation plans according to the intrinsic
method under APB Opinion No. 25. In accordance with Statement of Financial
Accounting Standard No. 123 (SFAS No. 123), "Accounting for Stock-Based
Compensation," we are required, at a minimum, to report pro forma disclosures of
expense for stock-based awards based on their fair values. Had compensation cost
been determined consistent with SFAS No. 123, our net income and basic and
diluted earnings per share for the three months ended April 2, 2004, and April
4, 2003, would have been as follows:

<TABLE>
<CAPTION>
                                                                       APRIL 2,      APRIL 4,
                                                                         2004          2003
                                                                       -----------   --------
                                                                           (IN THOUSANDS,
                                                                       EXCEPT PER SHARE DATA)
<S>                                                                    <C>           <C>
Net Income
     As reported                                                       $  4,349      $    207
     Deduct - total stock-based employee compensation expense
        determined under the fair value based method for all awards,
        net of related tax effects                                           52            43
                                                                       --------      --------
     Pro forma                                                         $  4,297      $    164
                                                                       ========      ========

Basic and Diluted Income Per Share
     As reported - Basic                                               $   0.85      $   0.04
     Pro forma - Basic                                                 $   0.84      $   0.03

     As reported  - Diluted                                            $   0.74      $   0.04
     Pro forma - Diluted                                               $   0.73      $   0.03
</TABLE>

                                       9

<PAGE>

The assumptions used to calculate the fair value of options granted are
evaluated and revised, upon estimating the fair value of each new option grant,
to reflect market conditions and experience.

5.    NEW ACCOUNTING PRONOUNCEMENTS

In January 2003, the FASB issued Interpretation No. 46 (FIN 46) "Consolidation
of Variable Interest Entities." Until this interpretation, a company generally
included another entity in its consolidated financial statements only if it
controlled the entity through voting interests. FIN 46 requires a variable
interest entity to be consolidated by a company if that company is subject to a
majority of the risk of loss from the variable interest entity's activities or
entitled to receive a majority of the entity's residual returns. In December
2003, the FASB issued FIN 46R, "Consolidation of Variable Interest Entities, an
Interpretation of ARB 51 (as revised December 2003)." The primary objectives of
FIN 46R are to provide guidance on the identification of entities for which
control is achieved through means other than through voting rights (Variable
Interest Entities) and how to determine when and which business enterprise
should consolidate the Variable Interest Entity (the Primary Beneficiary). We do
not have any variable interest entities and therefore, FIN 46R did not impact
our financial position, results of operations or cash flows.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

GENERAL. Unless the context indicates or requires otherwise, the terms "we,"
"us," "our" and other references to our company refer to John Q. Hammons Hotels,
Inc. and John Q. Hammons Hotels, L.P., including all of our subsidiaries.

Our consolidated financial statements include revenues from our owned hotels and
management fee revenues for providing management services to the managed hotels
(owned or directly controlled by Mr. Hammons). References to our hotels include
both our owned hotels and our managed hotels. We derive revenues from the owned
hotels from rooms, food and beverage, meeting rooms and other revenues. Our
beverage revenues include only revenues from the sale of alcoholic beverages,
while we show revenues from the sale of non-alcoholic beverages as part of food
revenue. Direct operating costs and expenses include expenses we incur in
connection with the direct operation of rooms, food and beverage and telephones.
Our general, administrative, sales and management services expenses include
expenses incurred for franchise fees, administrative, sales and marketing,
utilities, insurance, property taxes, rent, management services and other
expenses.

We currently have no hotels under construction and no plans to develop new
hotels for the foreseeable future. During 2000, we entered into a five-year
management contract with John Q. Hammons whereby we will provide internal
administrative, architectural design, purchasing and legal services, to Mr.
Hammons in conjunction with the development of hotels in an

                                       10

<PAGE>

amount not to exceed 1.5% of the total development cost of any single hotel for
the opportunity to manage the hotel upon opening and the right of first refusal
to purchase the hotel in the event it is offered for sale. These costs are
amortized over a five-year contract period, beginning upon the opening of the
hotels.

Although we are not developing new hotels, Mr. Hammons has personally completed
several projects, including new hotels in Tulsa and Oklahoma City, Oklahoma and
Rogers and Hot Springs, Arkansas, all of which we currently manage under the
management agreement described above. Mr. Hammons also has numerous other
projects in various stages of development, which we intend to manage upon
completion, including properties in St. Charles and Springfield, Missouri;
Junction City, Kansas; Frisco, Texas; Albuquerque, New Mexico and North
Charleston, South Carolina.

RESULTS OF OPERATIONS

The following discussion and analysis addresses results of operations for the
three month periods ended April 2, 2004 (which we refer to as the 2004 Quarter)
and April 4, 2003 (which we refer to as the 2003 Quarter). The results of
operations for the 2004 Quarter are not indicative of the results to be expected
for the full year.

Total revenues for the 2004 Quarter were $114.4 million, an increase of $4.3
million, or 3.9%, compared to the 2003 Quarter, as a result of increases in the
association and corporate group market segments of our business.

Rooms revenues increased $2.8 million, or 4.2%, from the 2003 Quarter, and as a
percentage of total revenues increased slightly to 61.4% from 61.2%. The
increase was primarily due to the increase in association and corporate group
market segments of our business noted above. Our average room rate decreased
very slightly, to $101.29, a 0.1% decrease compared to the 2003 Quarter average
room rate of $101.42, and our occupancy for the 2004 Quarter increased 2.7
percentage points to 65.5% from 62.8% in the 2003 Quarter. In comparison, the
average room rate for the hotel industry, based on information from Smith Travel
Research, was $86.89 in the 2004 Quarter, up 3.1% from the 2003 Quarter.
Occupancy for the hotel industry was 56.8% in the 2004 Quarter, up 4.4% from the
2003 Quarter. Our Revenue Per Available Room, or RevPAR, was $66.33 in the 2004
Quarter, up 4.1% from $63.69 in the 2003 Quarter. RevPAR for the hotel industry
in the 2004 Quarter was $49.37, up 7.7% from the 2003 Quarter.

Food and beverage revenues increased by $1.0 million, or 3.4%, compared to the
2003 Quarter, but decreased slightly as a percentage of total revenues to 26.3%
from 26.4%. The dollar increase was due to increased banquet revenues related to
increased association and corporate group market segments of our business
discussed above.

Meeting room rental, related party management fee and other revenues increased
$0.5 million, or 3.7%, from the 2003 Quarter but decreased slightly as a
percentage of revenues to 12.3%

                                       11

<PAGE>

from 12.4% in the 2003 Quarter. The dollar increase was primarily related to
guest room internet revenues and related party management fees, partially offset
by decreased telephone revenues.

Rooms operating expenses increased by $1.0 million, or 6.1%, compared to the
2003 Quarter, and increased as a percentage of rooms revenues to 24.6% from
24.2% in the 2003 Quarter. The increase was attributable to costs associated
with the increased number of occupied rooms and unfavorable workers compensation
loss experience compared to the 2003 Quarter.

Food and beverage operating expenses increased $0.2 million, or 0.9%, compared
to the 2003 Quarter, but decreased as a percentage of food and beverage revenues
to 73.4% from 75.3%. The dollar increase was attributable to higher food and
beverage sales volumes, and the percentage decrease related to continued
improved food purchasing programs.

Other operating expenses decreased slightly to $0.6 million, compared to the
2003 Quarter, and decreased as a percentage of meeting room rental, related
party management fee and other revenues, to 4.3% from 5.1%.

General, administrative, sales and management service expenses increased $0.3
million, or 0.8%, over the 2003 Quarter, but decreased as a percentage of total
revenues to 31.8% from 32.8%. The dollar increase was primarily attributable to
increases in costs associated with utilities, franchise-sponsored sales and
reservations offices, franchise fees and franchise frequent traveler programs,
partially offset by decreases in management and sales and marketing compensation
costs from the 2003 Quarter.

Repairs and maintenance expenses increased slightly by $0.2 million, but
remained stable as a percentage of revenues, at 4.1%.

Depreciation and amortization expenses decreased $0.6 million, or 4.8%, compared
to the 2003 Quarter, and decreased as a percentage of revenues to 10.4% from
11.4%. The decrease is primarily attributable to our cessation of new
development in 2000.

Income from operations increased by $3.1 million, or 17.0%, and increased as a
percentage of revenues to 18.6% from 16.5% in the 2003 Quarter, primarily as the
result of increased rooms revenues from higher occupancy and improved cost
controls discussed above.

Interest expense and amortization of deferred financing fees, net of interest
income decreased by $0.4 million, or 2.3%, and decreased as a percentage of
total revenues to 14.9% from 15.8% in the 2003 Quarter. The decrease was
primarily attributable to the reduction in long-term debt compared to the 2003
Quarter.

Income before minority interest and provision for income taxes was $4.4 million
in the 2004 Quarter and $1.0 million in the 2003 Quarter.

                                       12

<PAGE>

Net income allocable to the company was $4.3 million in the 2004 Quarter,
compared to $0.2 million for the 2003 Quarter. In the 2004 Quarter, $3.3 million
of the income represents the recapture of the limited partner's losses we
absorbed in the fourth quarter of 2003. An additional $0.5 million must be
recaptured before the limited partner can be allocated future earnings in
minority interest.

The following represents a reconciliation of the net income, as reported, to the
net income, as adjusted (in thousands):

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED
                                                            ----------------------------
                                                            Apr. 2, 2004    Apr. 4, 2003
                                                            ------------    ------------
<S>                                                         <C>             <C>
Net income, as reported                                     $      4,349    $        207
Deductions:

   Reallocation of minority interest earnings                     (3,322)              -
                                                            ------------    ------------
Net income, as adjusted                                     $      1,027    $        207
                                                            ============    ============
</TABLE>

Basic and diluted earnings per share were $0.85 and $0.74, respectively in the
2004 Quarter, compared to $0.04 in the 2003 Quarter. The earnings per share for
the 2004 Quarter reflect the recapture of the limited partner's losses described
above.

LIQUIDITY AND CAPITAL RESOURCES

In general, we have financed our operations through internal cash flow, loans
from financial institutions, the issuance of public and private debt and equity
and the issuance of industrial revenue bonds. Our principal uses of cash are to
pay operating expenses, to service debt and to fund capital expenditures.

At April 2, 2004, we had $42.9 million of cash and equivalents and $15.6 million
of marketable securities, compared to $23.8 million and $15.7 million,
respectively, at the end of fiscal 2003. Such amounts are available for our
working capital requirements, capital expenditures and debt service. At April 2,
2004, and January 2, 2004, we had restricted cash reserves of $23.5 million and
$21.7 million, respectively. This restricted cash is escrowed for insurance,
taxes, capital expenditures and certain other obligations, in accordance with
specific loan covenants and franchise agreements.

Cash from operating activities increased to $25.0 million for the 2004 Quarter,
from $23.7 million for the 2003 Quarter, an increase of $1.3 million, or 5.5%,
primarily attributable to the increase in net income, partially offset by
changes in certain assets and liabilities.

We incurred capital expenditures of $2.6 million in the 2004 Quarter, compared
to $3.1 million in 2003 Quarter. Capital expenditures typically include capital
improvements on existing hotel properties.

                                       13

<PAGE>

During fiscal 2000, we initiated claims against certain of our construction
service providers, as well as our insurance carrier. These claims resulted from
costs we incurred and expected to incur to address moisture related problems
caused by water intrusion through defective windows. In December 2001, we
initiated legal actions in an effort to collect claims previously submitted.
Subsequent to the filing of the legal action, the insurance carrier notified us
that a portion of our claims had been denied. As of April 2, 2004, we had
incurred approximately $11.8 million of an estimated $12.3 million of costs to
correct the underlying moisture problem. During the third quarter of 2003,
summary judgment was granted to our insurance carrier in one action, which is
currently on appeal. Summary judgment was also granted to one of our window
manufacturers and we are in the process of appealing that decision. We plan to
continue to vigorously pursue collection of these costs, although there can be
no assurance that we will be successful. Our total cumulative depreciation
charge through April 2, 2004, was $7.6 million, which we recorded in fiscal year
2001 to reserve the net historical costs of the hotel property assets
refurnished absent any recoveries. To the extent we realize recoveries, we will
record them as a component of other income.

At April 2, 2004, our total debt was $778.9 million compared with $781.1 million
at the end of fiscal 2003. The decrease of $2.2 million is primarily
attributable to scheduled principal payments on long term debt. The current
portion of long-term debt was $7.3 million at the end of the 2004 Quarter
compared with $7.4 million at the end of 2003.

We estimate 2004 capital requirements to be $30.8 million (including
approximately $5.7 million related to planned hotel franchise conversions of
some of our properties), and to be funded by cash and cash flow from operations.
Based upon current plans, we anticipate that our capital resources will be
adequate to satisfy our 2004 capital requirements for normal recurring capital
improvement projects.

OTHER MATTERS

From time to time, our Chairman, CEO and principal owner, Mr. John Q. Hammons,
may examine various alternatives with respect to some or all of his holdings in
the Company and the Partnership. These often times may be from inquiries
unsolicited by Mr Hammons, but they also may be solicited directly by him or by
persons engaged by him for these purposes. Our board of directors is not
involved in these discussions. If Mr. Hammons seeks to pursue a particular
transaction that would affect the Company, our board of directors will evaluate
the opportunity based upon what it believes to be in the best interests of all
holders of its common stock.

NEW ACCOUNTING PRONOUNCEMENTS

In January 2003, the FASB issued Interpretation No. 46 (FIN 46) "Consolidation
of Variable Interest Entities." Until this interpretation, a company generally
included another entity in its consolidated financial statements only if it
controlled the entity through voting interests. FIN 46 requires a variable
interest entity to be consolidated by a company if that company is

                                       14

<PAGE>

subject to a majority of the risk of loss from the variable interest entity's
activities or entitled to receive a majority of the entity's residual returns.
In December 2003, the FASB issued FIN 46R, "Consolidation of Variable Interest
Entities, an Interpretation of ARB 51 (as revised December 2003)." The primary
objectives of FIN 46R are to provide guidance on the identification of entities
for which control is achieved through means other than through voting rights
(Variable Interest Entities) and how to determine when and which business
enterprise should consolidate the Variable Interest Entity (the Primary
Beneficiary). We do not have any variable interest entities and therefore, FIN
46R did not impact our financial position, results of operation or cash flows.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires us to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period. On an ongoing basis, we evaluate our estimates and assumptions,
including those related to bad debts, investments, valuation of long-lived
assets, tax valuation allowance, self-insurance reserves, contingencies and
litigation. We base our estimates and judgments on historical experience and
various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis for making judgments about
the carrying value of assets and liabilities that are not readily apparent from
other sources. We believe the following critical accounting policies, among
others, affect our more significant estimates and assumptions used in preparing
our consolidated financial statements. Actual results could differ from our
estimates and assumptions.

Trade receivables are reflected net of an estimated allowance for doubtful
accounts. This estimate is based primarily on historical experience and
assumptions with respect to future payment trends.

Property and equipment are stated at cost less accumulated depreciation. We
periodically review the carrying value of property and equipment and other
long-lived assets for indications that the carrying value of such assets may not
be recoverable. This review consists of a comparison of the carrying value of
the assets with the expected future undiscounted cash flows. If the respective
carrying values exceed the expected future undiscounted cash flows, the
impairment is measured using fair value measures to the extent available or
discounted cash flows.

Our deferred financing costs, franchise fees and other assets include management
and franchise contracts and leases. The value of our management and franchise
contracts and leases are amortized on a straight-line method over the life of
the respective agreement. The assessment of management and franchise contracts
and leases requires us to make certain judgments, including estimated future
cash flow from the respective properties.

                                       15

<PAGE>

We are self-insured for various levels of general liability, workers'
compensation and employee medical coverages. Estimated costs related to these
self insurance programs are accrued based on known claims and projected
settlements of unasserted claims. Subsequent changes in, among others,
unasserted claims, claim cost, claim frequency, as well as changes in actual
experience, could cause these estimates to change.

We recognize revenues from our rooms, catering and restaurant facilities as
earned on the close of business each day.

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains "forward-looking statements" within the meaning of
Section 21E of the Securities Exchange Act of 1934, regarding, among other
things, our operations outlook, business strategy, prospects and financial
position. These statements contain the words "believe," "anticipate,"
"estimate," "expect," "project," "forecast," "intend," "may," "will," and
similar words. These forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results to be
materially different from any future results expressed or implied by such
forward-looking statements. Such factors include, among others:

      -     General economic conditions, including the duration and severity of
            the current economic slowdown and the pace at which the lodging
            industry adjusts to the continuing war on terrorism;

      -     The impact of any serious communicable diseases on travel;

      -     Competition;

      -     Changes in operating costs, particularly energy and labor costs;

      -     Unexpected events, such as the September 11, 2001 terrorist attack;

      -     Risks of hotel operations, such as hotel room supply exceeding
            demand, increased energy and other travel costs and general industry
            downturns;

      -     Seasonality of the hotel business;

      -     Cyclical over-building in the hotel and leisure industry;

      -     Requirements of franchise agreements, including the right of some
            franchisors to immediately terminate their respective agreements if
            we breach certain provisions; and

      -     Costs of complying with applicable state and federal regulations.

These risks are uncertainties and, along with the risk factors discussed in our
Annual Report on Form 10-K, should be considered in evaluating any forward
looking statements contained in this Form 10-Q. We undertake no obligation to
update or review publicly any forwarding-looking statement, whether as a result
of new information, future events or otherwise, other than as required by law.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

                                       16

<PAGE>

We are exposed to changes in interest rates primarily as a result of our
investing and financing activities. Investing activity includes operating cash
accounts and investments with an original maturity of three months or less, and
certain balances of various money market and common bank accounts. Our financing
activities are comprised of long-term fixed and variable-rate debt obligations
utilized to fund business operations and maintain liquidity. The following table
presents the principal cash repayments and related weighted average interest
rates by maturity date for our long-term fixed and variable-rate debt
obligations as of April 2, 2004:

                             EXPECTED MATURITY DATE
                                  (in millions)

<TABLE>
<CAPTION>
                                                                                                                       Fair
                                                                                                                       Value
                                       2004(d)      2005       2006       2007       2008     There-After  Total        (e)
<S>                                    <C>          <C>        <C>        <C>        <C>      <C>          <C>         <C>
Long-Term Debt(a)

$510 Million 1st Mortgage Notes        $     -      $  -       $  -       $  -       $  -        $499      $ 499       $ 556
   Average interest rate(b)                8.9%      8.9%       8.9%       8.9%       8.9%        8.9%       8.9%
Other fixed-rate debt obligations      $     6      $  7       $ 28       $ 42       $ 52        $109      $ 244       $ 244
   Average interest rate(b)                8.3%      8.3%       7.8%       8.4%       8.4%        8.9%       8.6%
Other variable-rate debt obligations   $     1      $  1       $ 10       $  1       $ 23        $  -      $  36       $  36
   Average interest rate(c)                4.6%      4.6%       4.6%       4.6%       4.6%          -%       4.6%
</TABLE>

(a)   Includes amounts reflected as long-term debt due within one year.

(b)   For the long-term fixed rate debt obligations, the weighted average
      interest rate is based on the stated rate of the debt that is maturing in
      the year reported. The weighted average interest rate excludes the effect
      of the amortization of deferred financing costs.

(c)   For the long-term variable rate debt obligations, the weighted average
      interest rate assumes no changes in interest rates and is based on the
      variable rate of the debt, as of April 2, 2004, that is maturing in the
      year reported. The weighted average interest rate excludes the effect of
      the amortization of deferred financing costs.

(d)   The 2004 balances include actual and projected principal repayments and
      weighted average interest rates.

(e)   The fair values of long-term debt obligations approximate their respective
      historical carrying amounts except with respect to the $510 million First
      Mortgage Notes. The fair value of the First Mortgage Notes is estimated by
      obtaining quotes from brokers. A one percentage point change in the par or
      the then-current premium or discount quote received for the $510 million
      First Mortgage Notes would have an effect of approximately $5 million. A
      one percentage point change in the 8-7/8% rate used to calculate the fair
      value of other fixed rate debt would change its estimated fair value by
      approximately $12 million.

ITEM 4. CONTROLS AND PROCEDURES.

                                       17

<PAGE>

      Evaluation of disclosure controls and procedures. Our chief executive
officer and chief financial officer have evaluated the effectiveness of our
"disclosure controls and procedures" (as defined in Rules 13a-14(d) and
15d-14(d) under the Securities Exchange Act of 1934) as of April 2, 2004. Based
on that review, they have concluded that, as of such date, our disclosure
controls and procedures were effective to ensure that material information
relating to us would be made known to them.

      Changes in internal controls. There were no significant changes in our
internal controls or, to the knowledge of our chief executive officer and chief
financial officer, in other factors that could significantly affect our internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses, after the date of such evaluation.

PART II. OTHER INFORMATION AND SIGNATURES

ITEM 1. Legal Proceedings

      Not Applicable

ITEM 2. Changes in Securities and Use of Proceeds

      Not Applicable

ITEM 3. Defaults Upon Senior Securities

      Not Applicable

ITEM 4. Submission of Matters to a Vote of Securities Holders

      Not Applicable

ITEM 5. Other Information

      On May 11, 2004, our board of directors adopted a charter for the
Nominating and Corporate Governance Committee. The charter, which is posted on
our website at www.jqhhotels.com/committeecharters provides that the nominating
committee will consider director candidates recommended by any shareholder,
director or employee, if the written recommendation is received by the committee
at least 120 days before the date of the proxy statement for the prior year's
annual meeting of stockholders.

      This procedure for suggesting candidates to the Committee is separate from
a stockholder's right to directly nominate a candidate, as described in our
proxy statement and Bylaws, although the date for providing information will in
many cases be the same.

                                       18

<PAGE>

      The charter also provides that the Committee shall use the same process
and standards to review and evaluate all potential director nominees, regardless
of the source of the recommendation for the candidate.

ITEM 6. Exhibits and Reports on Form 8-K

      (a)   Exhibits

      See Exhibit Index.

      (b)   Reports on Form 8-K

      Report on Form 8-K filed February 18, 2004, to furnish press release with
      2003 year end financial results.

                                       19

<PAGE>

                                   SIGNATURES

      Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.

                                      JOHN Q. HAMMONS HOTELS, INC.

                                      By: /s/ John Q. Hammons
                                          --------------------------------------
                                          John Q. Hammons
                                          Chairman, Founder, and Chief Executive
                                          Officer

                                      By: /s/ Paul E. Muellner
                                          --------------------------------------
                                          Paul E. Muellner
                                          Chief Financial Officer

Dated: May 14, 2004

                                       20

<PAGE>

                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO.                             TITLE
<S>            <C>
31.1           Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer

31.2           Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer

32             Section 1350 Certification of Chief Executive Officer and Chief
               Financial Officer
</TABLE>

                                       21