Marriott raises 2026 revenue outlook as third-quarter profit rises 9% to $794mn

Marriott International has raised its full-year revenue outlook after reporting a 9 per cent increase in third-quarter net profit to $794mn, supported by stronger hotel demand, higher room rates and continued expansion across its global portfolio.

The US hotel group said on Monday that worldwide revenue per available room (RevPAR), a key industry measure of hotel performance, increased 6.5 per cent in the three months to September 30, 2026, driven by higher average daily rates and occupancy.

Growth was particularly strong in the US and Canada, where RevPAR rose 7.4 per cent, while international markets recorded a 4.4 per cent increase.

The company raised its forecast for worldwide RevPAR growth in 2026 to between 4.5 and 5 per cent, citing stronger-than-expected third-quarter performance and expectations of continued healthy travel demand.

Reported net income climbed to $794mn from $728mn a year earlier, while diluted earnings per share increased to $3.04 from $2.67.

Adjusted net income rose to $790mn from $674mn, with adjusted earnings per share increasing to $3.02 from $2.47.

Adjusted earnings before interest, tax, depreciation and amortisation rose 12 per cent to $1.51bn, compared with $1.35bn in the corresponding period last year.

Anthony Capuano, Marriott’s president and chief executive, said the results reflected the company’s global scale, brand portfolio and ability to capture demand across different customer segments.

“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,” Capuano said.

“In the U.S. & Canada, RevPAR rose over 7 percent, with broad-based growth across customer segments and chain scales.”

International performance was led by the Asia-Pacific region excluding China, where RevPAR increased by more than 9 per cent, supported by strong inbound international travel demand.

Europe, the Middle East and Africa recorded RevPAR growth of more than 4 per cent, with European markets contributing to the improvement.

Marriott said the continuing conflict in the Middle East had affected hotel performance in the region, although trading conditions improved significantly compared with the second quarter.

The company did not provide a separate RevPAR figure for Africa in its earnings announcement.

The results also reflected higher revenues from Marriott’s franchise and hotel management operations.

Franchise and base management fees increased 13 per cent to $1.34bn, compared with $1.19bn a year earlier, supported by higher hotel room revenues, portfolio expansion and increased fees from co-branded credit card partnerships.

Incentive management fees rose 22 per cent to $181mn, with all geographic regions recording year-on-year growth.

Reported operating income increased to $1.27bn from $1.18bn, while adjusted operating income climbed to $1.27bn from $1.12bn.

However, higher borrowing costs weighed on the group’s expenses. Net interest expense increased to $219mn from $194mn, reflecting higher debt balances.

Marriott ended September with total debt of $16.8bn, up from $16.2bn at the end of 2025, while cash and cash equivalents stood at approximately $500mn.

The company continued to expand its global hotel portfolio, adding approximately 20,100 net rooms during the quarter, including more than 13,400 in international markets.

Its worldwide system reached more than 10,200 properties and nearly 1.83mn rooms at the end of September, representing net room growth of 4.6 per cent compared with the previous year.

Marriott’s development pipeline reached a record 4,209 properties, representing more than 634,000 rooms.

Of these, approximately 278,000 rooms across 1,750 properties were under construction or undergoing conversion to Marriott brands.

More than half of the rooms in the development pipeline were located outside the US and Canada, highlighting the growing importance of international markets to the company’s expansion strategy.

Capuano said hotel conversions remained an important source of growth, accounting for more than one-third of new signings and more than 40 per cent of openings during the first nine months of 2026.

The company’s Marriott Bonvoy loyalty programme also continued to expand, reaching approximately 309mn members worldwide at the end of the quarter.

Marriott said partnerships with companies including Uber and Starbucks had helped strengthen customer engagement and extend the programme’s reach.

The group continued returning capital to shareholders, repurchasing approximately 3.5mn shares for $1.3bn during the third quarter.

By October 28, Marriott had returned approximately $4bn to shareholders through dividends and share buybacks since the beginning of the year, including $3.4bn spent repurchasing 9.6mn shares.

During the quarter, the company also issued $1.25bn in senior notes and refinanced its revolving credit facility, increasing its size from $4.5bn to $5bn and extending its maturity to September 2031.

Marriott expects worldwide RevPAR growth of between 4.5 and 5 per cent in the fourth quarter, matching its updated full-year growth forecast.

The company also expects full-year net room growth at the lower end of its previously indicated range of 4.5 to 5 per cent.

Its updated outlook assumes broadly unchanged macroeconomic conditions, although geopolitical uncertainty, particularly in the Middle East, remains a potential risk to international hotel demand.

The combination of higher room revenues, rising management fees and a record development pipeline provides Marriott with a foundation for further expansion, even as borrowing costs and regional geopolitical pressures remain challenges for the global hospitality industry.