Marriott gives thumbs-up in North America
NEW YORK -- Marriott International Inc. is offering a mixed forecast for travel demand around the globe.
The hotel company, which also operates Ritz-Carlton hotels, Fairfield Inn & Suites, Courtyard and Renaissance, on Thursday declined to offer an earnings forecast for the year but said it expects stable demand in North America to continue. It's grown more cautious on its outlook for demand in the rest of the world, as weakness in Europe continues and growth in some parts of Asia slows.
Marriott expects revenue per room, a key performance measure for hotel companies, to rise 5 to 7 percent in North America in the current quarter, but only 3 percent elsewhere. Next year, it sees that metric continuing to increase at a mid-single digit rate despite sputtering global growth. Revenue per room factors in everything from the nightly base rate to room service and pay-per-view fees.
North American demand is being driven by strong occupancy rates that are allowing for price hikes across the company's brands. Major hotel research firms expect few new hotel rooms to open up next year, setting the stage for more rate increases.
The forecast came on the heels of strong third-quarter results released Wednesday. Marriott, based in Bethesda, Md., said it turned a bigger-than-expected profit in the summer season due to higher prices. The results topped Wall Street's and Marriott's own expectations.
Marriott shares fell 5 cents in Thursday afternoon trading to $38.95.