Summary:
- Marriott’s worldwide RevPAR rose 0.5 percent in the third quarter.
- The global pipeline reached 3,923 properties with more than 596,000 rooms.
- Net income increased 25 percent to $728 million from $584 million.
MARRIOTT INTERNATIONAL INC. reported a 0.5 percent increase in worldwide RevPAR and record year-to-date development signings in the third quarter. The company’s global development pipeline reached 3,923 properties, totaling over 596,000 rooms.
However, RevPAR in the U.S. and Canada fell 0.4 percent year over year, which Marriott attributed to weaker demand in lower chain scales, largely from reduced government travel. The company maintained its full-year RevPAR growth outlook of 1.5 to 2.5 percent.
“Our third-quarter results demonstrated continued execution of our growth strategy, the power of our brands and the cash flow benefits of our asset-light business model,” said Anthony Capuano, Marriott’s president and CEO. “Global RevPAR rose 0.5 percent in the third quarter, impacted by calendar shifts and ongoing macroeconomic uncertainty. International RevPAR increased 2.6 percent, led by APEC, which delivered nearly 5 percent growth from strong performance in key markets. In the U.S. and Canada, RevPAR declined 0.4 percent due to weaker demand in lower chain scales, largely reflecting reduced government travel.”
Marriott's operating income was $1.18 billion, up from $944 million a year earlier. Net income rose 25 percent to $728 million from $584 million, with diluted EPS of $2.67, up from $2.07. Adjusted operating income totaled $1.12 billion, adjusted net income was $674 million and adjusted diluted EPS rose to $2.47 from $2.26. Adjusted EBITDA increased 10 percent to $1.35 billion from $1.23 billion.
Capuano said the company’s global luxury hotels continued to outperform, with luxury RevPAR rising 4 percent in the quarter.
“During the first nine months of the year, we had record year-to-date signings and conversions made up about one-third of our signings and openings,” he said. “We still expect net rooms growth to approach 5 percent for full-year 2025 and remain in the mid-single-digit range over the next few years.”
Marriott added about 17,900 rooms in the quarter, including nearly 13,900 international rooms, bringing its system to more than 9,700 properties, or roughly 1.75 million rooms. At the end of the third quarter, 1,536 properties with more than 250,000 rooms were under construction, with more than half in international markets. However, the system and pipeline do not include rooms from Marriott’s April acquisition of the CitizenM brand, which is expected to integrate in the fourth quarter.
The company also launched the Outdoor Collection by Marriott Bonvoy, offering accommodations near national parks, deserts, ski areas and other nature destinations.
Marriott’s third-quarter base management and franchise fees rose nearly 6 percent to $1.19 billion from $1.12 billion, driven by rooms growth and higher co-branded credit card fees. Incentive management fees fell to $148 million from $159 million, reflecting declines in the U.S. and Canada.
The company’s owned, leased and other revenue, net of direct expenses, rose to $94 million from $81 million. General, administrative and other expenses fell to $234 million from $276 million. Restructuring, merger-related recoveries and other items produced a $40 million benefit, compared with a $9 million expense a year earlier, largely from insurance recoveries. Interest expense increased to $194 million from $168 million and the income tax provision totaled $266 million, up from $202 million.
“The power of Marriott Bonvoy has continued to grow, adding 12 million members in the quarter to nearly 260 million globally, with member penetration at 75 percent in the U.S. and Canada and 68 percent globally,” he said. “Our financial performance and cash generation allowed us to return approximately $3.1 billion to our shareholders year-to-date and we continue to expect to return about $4 billion in 2025.”
It is advancing its multiyear digital and technology transformation, scaling generative AI to automate high-cost processes and improve experiences.
Marriott’s global development pipeline at the end of the second quarter included about 3,900 properties with over 590,000 rooms. The company added roughly 17,300 net rooms, signed nearly 32,000 and reported more than 70 percent of signings and 8,500 of added rooms in international markets.
