BETHESDA, Maryland - Marriott International exceeded its quarterly revenue and profit estimates, driven by better than expected occupancy levels and higher rates amidst more group travel bookings and longer hotel stays.
After the end of most COVID 19 restrictions, travelers are spending more on hotels, airplane tickets and car rentals, a trend that has shown no signs of slowing despite surging inflation and a potential recession.
In a call with investors, Marriott CEO Anthony Capuano said that the shift towards experiences versus goods, the lifting of travel restrictions and the opening of borders in most markets around the world is fueling travel. The average length of stay at Marriott is up 25 percent, compared to 2019 according to Kathleen Oberg, Marriott's chief financial officer.
While international travel, urban and luxury bookings are experiencing an upturn, occupancy levels in those segments still trail bookings for resorts.
According to Jan Freitag, CoStar group national director of hospitality analytics, the continued dollar parity that may cause Americans to go abroad will deter international travelers from coming to the United States, said Jan Freitag, the nation's national director of hospitality, as quoted by Reuters.
In June, corporate room bookings were 9 percent less than the same month a year ago, compared to 20 percent down in the first quarter.
Since travelers can substitute a Teams or Zoom call instead of a team, the growth that urban hotels can expect is a result of downtown office occupancies, according to Freitag.
Marriott, which operates the Sheraton and Ritz-Carlton hotels, said that travelers are combining leisure and business trips.
The company reported adjusted earnings of $1.80 per share, higher than Wall Street's forecast of $1.56 a share, while its revenue rose 70 percent year-on-year to $5.34 billion, above analysts' expectations of $4.92 billion, according to Refinitiv data.