Marriott lifts outlook as US, Canada drives Q3 beat

(Sharecast News) - Marriott International shares surged on Monday after the hotel operator reported stronger-than-expected third-quarter earnings and raised its annual revenue outlook amid resilient travel demand.

Revenues rose 8% year-on-year to $7.01bn in the three months to September, from $6.49bn a year earlier.

Adjusted net income climbed 17% to $790m, while adjusted earnings per share jumped 22% to $3.02, ahead of the $2.84 consensus forecast.

Worldwide revenue per available room (RevPAR), a key industry performance measure, rose 6.5%, driven by higher room rates and occupancy. RevPAR increased 7.4% in the US and Canada and 4.4% across international markets.

Franchise and base management fees rose 13% to $1.34bn, driven by higher co-branded credit card fees, RevPAR growth and an expanding hotel portfolio. Incentive management fees jumped 22% to $181m.

Chief executive Anthony Capuano said: "Our excellent third-quarter results reflected continued momentum across our business, the benefits of our global scale, and the power of our brands and revenue engines."

He highlighted particularly strong trading in Asia-Pacific outside China, where RevPAR increased more than 9%. Growth in Europe also helped lift performance across the EMEA region, although the Middle East conflict continued to affect trading.

Marriott raised its full-year global RevPAR growth forecast to 4.5-5.0%, from 3.0-3.5% previously, citing strong third-quarter performance and expectations for continued healthy demand.

Marriott added around 20,100 net rooms during the quarter, taking its development pipeline to a record of more than 634,000 rooms across over 4,200 properties.

The stock was up 4.7% at $418.19 by 1444 GMT.