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Key Takeaways
- Marriott International lowered the upper end of its 2024 revenue per available room guidance when it reported second-quarter earnings Wednesday.
- The hotel chain noted a weaker operating environment in China and telegraphed softer expectations in the U.S. and Canada.
- Shares fell to their lowest level since January.
Marriott International’s (MAR) second-quarter results Wednesday came with disappointing revenue per available room (revPAR) guidance, sending the huge hotel company’s shares sharply lower.
The hotel chain trimmed its full-year revPAR projection to between 3% and 4%, compared with prior guidance of 3% to 5%, citing a weaker operating environment in Greater China and softer expectations in the U.S. and Canada.
In the second quarter, Marriott’s worldwide revPAR grew nearly 5% year-over-year to $150.24, and the company reported about 15,500 net rooms added. All told, Marriott operated nearly 9,000 properties with roughly 1.7 million rooms at the end of the period.
Marriott’s net income totaled $772 million in the period, up 6%, and earnings per share (EPS) climbed 13% to $2.69.
“Owner preference for our brands remains strong,” Chief Executive Officer (CEO) Anthony Capuano said. “We signed nearly 31,000 rooms in the quarter, 75% of which were in international markets. Our momentum around conversions [of hotels to Marriott brands] continued, accounting for 37% of room additions in the quarter.”
Capuano said the company continues to expect net rooms growth at 5.5% to 6% for the full year.
Marriott shares were down nearly 5% in mid-afternoon trading Wednesday, at their lowest level since January.
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