Marriott reports 'terrific' third quarter

Marriott International CEO Anthony Capuano touted another “terrific” quarter during the company’s Q3 earnings call Thursday, telling analysts that global travel demand “has remained strong” across the board.

International demand continued to be a standout, however, with Marriott’s international RevPAR up 22% on the same period in 2022, driven primarily by “significant gains” across Asia.

“We’re within a percentage point of getting back to prepandemic levels of cross-border travel,” said Capuano, who added that more “upside is still expected to come in Asia-Pacific,” as international airlift in Greater China is expected to ramp up from around 15% of 2019’s capacity in the third quarter to around 60% by the end of this year. 

Demand from outbound U.S. and Canadian travelers also helped boost international performance. According to Capuano, third-quarter leisure room nights from U.S. and Canadian guests traveling outside the region were up nearly 25% over last year. 

Group demand shows ‘remarkable’ strength

Also showing “remarkable” strength in Q3 was group demand, which Capuano said is “expected to continue to be a meaningful driver of revenue growth going forward.” In the U.S. and Canada, Marriott’s fourth-quarter 2023 group revenues were projected be up 12% year over year at the end of September, with full-year group revenue pacing up 19%.

Marriott’s leisure demand also remained robust, with global leisure revenue up 9% on the same quarter last year and leisure revenue in the U.S. and Canada rising 4% during the same period.

Lastly, business transient demand continued a trend of “slow and steady” progress, as business transient revenue in the U.S. and Canada also increased 4%, bolstered in part by “nice, sequential improvement in demand” from companies within the technology and finance sectors.

For the third quarter, Marriott reported systemwide RevPAR growth of 8.8%, to nearly $130. Occupancy for the quarter increased 3.2 percentage points to 72.1%, while ADR was up 4.1%, to roughly $180. 

Marriott reported the company posted third-quarter net income of $752 million, compared with of $630 million in the year-ago quarter. Revenue for the period totaled $5.9 billion, up from $5.3 billion in Q3 of 2022.

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