Marriott International capped off 2024 with solid growth in all its key performance metrics.
During the company’s latest earnings call, Marriott President and CEO Tony Capuano said the company saw global revenue per available room grow by more than 4% in 2024. Fourth-quarter worldwide RevPAR grew by 5% thanks to average daily rate increasing by 3% and occupancy rising by 1 percentage point.
Every one of Marriott’s regions produced better revenue-per-available-room growth than expected in 2024 with strength across all customer segments, Capuano said. The U.S. and Canada saw their best quarterly RevPAR growth of the year, growing 4% primarily due to higher average daily rate. Any election-related drop in occupancy was shorter than anticipated as hotel demand rebounded quickly after the election.
Marriott's international hotel RevPAR grew 7% in the fourth quarter due to a 4% rise in ADR and a 2-percentage-point increase in occupancy. In the Asia-Pacific region excluding Greater China, RevPAR grew by 12.5%, led by strong growth in Japan, India and Thailand thanks to strong cross-border demand.
In Greater China, RevPAR dipped by 2%, beating prior expectations thanks to the expanded visa-free transit policy and better-than-expected demand from multiple holidays and citywide events, Capuano said.
In Europe, the Middle East and Africa, Marriott's hotel RevPAR grew by 8% thanks to strong leisure demand.
Leisure demand made up the largest portion of global room nights at 44%, Capuano said. The segment had its strongest RevPAR growth quarter of the year and was the fastest-growing of the demand segments. It grew RevPAR 6% globally in the fourth quarter and 4% in the U.S. and Canada, driven by both gains in occupancy and ADR from midscale to luxury hotels.
Business-transient hotel guests contributed 33% of global room nights in the fourth quarter, he said. The demand segment's solid gains in ADR drove its RevPAR up 3% globally and 4% in the U.S. and Canada.
Group RevPAR made up 23% of room nights and grew by 3% in the quarter, Capuano said.
“As expected, this was group's lowest growth quarter of the year, due to fewer group events in the U.S. around November's election and a decline in group RevPAR in Greater China,” he said.
Full-year 2024 data shows all customer segments had solid RevPAR growth on a global basis, he said. Group demand increased by 8% and leisure and business transient rose by 3% each.
2025 expectations
Marriott expects net rooms growth of 4% to 5% in 2025, said Leeny Oberg, chief financial officer and executive vice president of development. Conversions can enter the system quickly, and while converted hotels were in the pipeline for an average of 14 months, almost 20% of conversions opened so quickly they were not in any quarter-end pipeline number.
Over the three-year period from the end of 2022 to year-end 2025, Marriott continues to expect net rooms to grow at a compound annual growth rate of 5% to 5.5%, she said.
Full-year 2025 RevPAR is expected to grow 2% to 4%, Oberg said. With the exception of Greater China, RevPAR growth in international regions will continue to be higher than in the U.S. and Canada even as it normalizes. RevPAR growth in Greater China is expected to be roughly flat year over year.
Marriott is off to a great start in 2025 with January RevPAR growing 6% globally, she said.
“The sensitivity of one-percentage-point change in full-year 2025 RevPAR versus 2024 could be around $50 million to $60 million of RevPAR-related fees and $5 billion in owned/leased profits,” she said.
Marriott expects $1 billion to $1.1 billion of investment spending in 2025 in three major areas, Oberg said. The first is another year of higher than historical investment in technology. More than half of this investment is associated with Marriott's multi-year transformation of its property management, reservations and loyalty systems.
The second is spending on Marriott’s owned/leased portfolio, she said. Executives expect the spending to be above historical levels this year, with about half of the investment driven by the completion of renovations of the Elegant Hotels portfolio in Barbados. The company plans to sell this portfolio after completing the renovations subject to long-term contracts so they remain in Marriott’s system.
The last major investment area is in contracts largely for new units to expand the global portfolio, she said.
Hotel development
Marriott added approximately 109,000 net hotel rooms globally in 2024, a 6.8% increase from year-end 2023, according to the company’s earnings release. That includes more than 45,000 net rooms in international locations. Conversions represented more than one-third of room signings and more than half of room additions.
By the end of 2024, its system included more than 9,300 hotels with about 1.7 million rooms and Marriott’s worldwide development pipeline included 3,766 properties with more than 577,000 rooms. That includes 175 properties with about 29,000 rooms approved for development but not yet subject to signed contracts. It had 1,381 properties with more than 229,000 rooms under construction, which includes hotels in the process of converting to a Marriott brand. Fifty-five percent of rooms in the pipeline at the end of 2024 were in international markets.
Marriott’s largest market, the U.S. and Canada, led the industry in growth room additions, with about one-third of all rooms open during the year flying one of Marriott’s flags, Capuano said. Though financing in the U.S. remains challenging for new construction, the company had the leading share of new-build construction starts in 2024.
“During the year, we also meaningfully expanded the breadth and depth of our portfolio across customer tiers, from luxury to midscale and across both traditional and alternative lodging product offerings,” he said.
There’s ongoing strong owner interest in all of Marriott’s midscale brands, Capuano said. By the end of 2024, the company had more than 300 open and in-pipeline Four Points Flex, StudioRes and City Express by Marriott properties just a year and a half after entering the midscale space.
Marriott moved further into the non-traditional space last year as well, he said. In December, the company announced its plan to launch an outdoor-focused collection, anchored by its acquisition of Postcard Cabins and partnership with Trailborn.
By the numbers
As of Dec. 31, 2024, Marriott reported net income of $455 million for the quarter, down from $848 million at end of year 2023, and adjusted net income of $686 million. Total revenue amounted to $6.4 billion, up from $6 billion a year ago.
Adjusted earnings before interest, taxes, depreciation and amortization was $1.286 billion, a 7% year-over-year increase.
For full-year 2024 results, the company reported net income of nearly $2.4 billion, down from just over $3 billion in 2023. Total revenue amounted to $25.1 billion, up from $23.7 billion.
Full-year adjusted EBITDA was $4.981 billion, a 7% year-over-year increase.
Marriott ended the year with $14.4 billion in debt and cash and cash equivalents of $400 million. For comparison, Marriott ended 2023 with $11.9 billion in debt and $300 million of cash and cash equivalents.
The company repurchased 2 million shares of common stock during the fourth quarter for $500 million. For full-year 2024, it repurchased 15.4 million shares for $3.7 billion. Year to date through Feb. 7, it has repurchased 1.2 million shares in 2025 for $350 million.
As of press time, Marriott's stock was trading at $289.68 per share, up 17.2% year over year. The NASDAQ Composite Index was up 23.2% for the same period.