Marriott’s third-quarter profit rises on strong travel demand

MARRIOTT International reported a rise in quarterly profit on Thursday (Nov 2), as the US hotel operator benefited from higher room prices and resilient travel demand.

Hotel operators have benefited in the last few months from a recovery in international travel as consumers took advantage of a strong US dollar and flexible work arrangements to vacation overseas.

“Both occupancy and rate contributed to global revenue per available room (RevPar) gains in the third quarter, and cross-border travel continued to rise,” Marriott’s CEO Anthony Capuano said in the statement.

The Maryland-based hotel operator posted an 8.8 per cent rise in RevPar, a key measure for hotels’ top-line performance, for the quarter, compared to a year earlier on a constant currency basis.

International room revenue increased 22 per cent, led by Asia-Pacific as cross-border travel continues to recover.

Marriott, which owns hotels such as Sheraton, Westin and St Regis, has also seen a steady uptick in bookings.

The company lifted its 2023 room revenue forecast for the second consecutive quarter to 14 per cent-15 per cent from 12 per cent-14 per cent, as demand for travel encouraged hotel operators to implement price hikes in the past year.

Marriott’s net income was US$752 million, or US$2.51 per share, in the quarter through September, compared with US$630 million, or US$1.94 per share, a year earlier.

The company’s revenue rose 12 per cent to US$5.93 billion, ahead of the analysts’ average estimate of US$5.89 billion, according to LSEG data. Its adjusted profit per share of US$2.11 was in line with estimates.

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Marriott raises profit forecast on strong travel demand

The Sheraton operator – shares of which were down 2.8 per cent at US$183.50 in premarket trading – cut its annual net rooms growth forecast to between 4.2 per cent and 4.5 per cent, compared to the earlier projection of 6.4 per cent to 6.7 per cent.

Last week, rival hotel operator Hilton Worldwide Holdings beat third-quarter revenue estimates and lifted its annual forecast. REUTERS