Marriott joins Hilton in lifting profit forecast on unabated travel demand

MARRIOTT International joined its rival Hilton in raising its annual profit forecast on Thursday (Nov 3), aided by higher pricing and a strong rebound in leisure and business travel even as recession risks cloud consumer spending.

Marriott, which owns hotels like Sheraton, Westin and St Regis, expects adjusted profit per share of between US$6.51 and US$6.58 this year, compared with its previous forecast of US$6.33 to US$6.59 per share.

“We expect continued demand growth around the world in the fourth quarter and anticipate that global RevPAR could increase 2 per cent to 4 per cent compared to 2019,” Marriott CEO Anthony Capuano said.

Pent-up desire to travel bolstered by a more powerful US dollar and flexible work arrangements have emboldened consumers and extended the travel season into the fall.

Upbeat earnings from Visa and American Express further underscored the strength in US consumer spending despite worries over inflation and rising interest rates.

Last week, Hilton also bumped its annual profit forecast.

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Marriott posted a 36.3 per cent rise in its revenue per available room (RevPAR), a key measure for a hotel’s top-line performance, for the quarter to Sep 30, compared to a year earlier on a constant currency basis.

Marriott’s revenues rose nearly 35 per cent to US$5.31 billion, falling slightly short of analysts’ average estimate of US$5.34 billion, as per Refinitiv data. REUTERS