Marriott cuts 2024 sales outlook on China drag, slow North American demand via Reuters
(Reuters) – Hotel company Marriott International (NASDAQ: ) cut its 2024 room revenue growth forecast on Wednesday, citing a weak operating environment in China and expectations of softer demand in North America.
The company's shares were down 4.7% before the bell.
Marriott expects revenue per available room (RevPAR), a key metric in the hospitality industry, to grow between 3% and 4% this year, lowering the high end of the range from 5%.
Hotels are not immune to China's consumer slowdown, writes Bernstein analyst Richard Clarke.
Companies around the world have been cutting full-year sales and profit expectations as global consumer sentiment is hurt by the weakness of the Chinese economy amid a prolonged commodity slump.
Marriott's RevPAR for the quarter fell 4.6% in China, compared to a 12% increase in the rest of Asia.
Meanwhile, domestic travel in the US has been weak since the beginning of the year as more tourists choose to travel internationally to Asia, Latin America and Europe.
The group's international RevPAR increased 6.4% in the quarter, led by 16.8% growth in the Middle East and Africa.
Incentive management fees came in at $195 million, compared to $193 million in the same period last year.
Excluding items, Marriott reported quarterly profit of $2.50 per share, above Wall Street expectations of $2.47 per share, according to LSEG data.
Net income for the quarter through June 30 was $6.44 billion, up nearly 6% from a year ago.
