• Net Rooms Growth: 6.8% for the full year 2024.
• Global RevPAR: Increased over 4% for the full year 2024; 5% increase in Q4 2024.
• ADR (Average Daily Rate): Rose 3% in Q4 2024.
• Occupancy: Increased over 1-percentage-point in Q4 2024.
• US and Canada RevPAR: Increased over 4% in Q4 2024.
• International RevPAR: Rose over 7% in Q4 2024.
• APAC RevPAR: Increased 12.5% in Q4 2024.
• EMEA RevPAR: Rose 8% in Q4 2024.
• Greater China RevPAR: Declined 2% in Q4 2024.
• Leisure RevPAR: 6% globally in Q4 2024.
• Business Transient RevPAR: Up 3% globally in Q4 2024.
• Group RevPAR: Rose 3% in Q4 2024.
• Gross Fee Revenues: Grew 7% to $1.3 billion in Q4 2024.
• Adjusted EBITDA: Grew 7% to $1.29 billion in Q4 2024.
• Profit Margins: Rose 110 basis points in Q4 2024.
• Cash Returns to Shareholders: Over $4.4 billion in 2024.
• 2025 Net Rooms Growth Expectation: 4% to 5%.
• 2025 Global RevPAR Growth Expectation: 2% to 4%.
• 2025 Adjusted EBITDA Expectation: Increase between 6% and 9% to $5.3 billion to $5.4 billion.
• 2025 Capital Returns Expectation: Approximately $4 billion.

• Warning! GuruFocus has detected 5 Warning Signs with SHOP.

Release Date: February 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Marriott International Inc (NASDAQ:MAR) achieved net rooms growth of 6.8% for the full year 2024, with global RevPAR rising over 4%.
• The company reported strong fourth-quarter worldwide RevPAR growth of 5%, with ADR rising 3% and occupancy increasing by over 1 percentage point.
• Marriott's loyalty program, Bonvoy, saw significant growth, adding over 31 million new members in 2024, reaching nearly 228 million members.
• The company expanded its portfolio with notable luxury hotel openings and plans to launch an outdoor-focused collection, enhancing its diverse offerings.
• Marriott returned over $4.4 billion to shareholders in 2024 through dividends and buybacks, demonstrating strong cash generation and shareholder value focus.

Negative Points

• Incentive management fees decreased year-over-year, with declines in Greater China and the US and Canada offsetting strength in APAC.
• RevPAR in Greater China declined by 2%, with Hainan Island experiencing a significant RevPAR decline due to weak domestic leisure demand.
• The company faces challenges in financing new construction in the US, although it led the industry in growth room additions.
• Marriott's 2025 guidance anticipates a decline in residential branding fees by nearly 50% due to the timing of unit sales.
• The effective tax rate is expected to increase to around 26% in 2025, compared to under 25% in 2024, impacting EPS growth.

Q & A Highlights

Q: Can you update us on your cost transformation and efficiency program? What areas have been a focus, and what's been the response from the ownership community and internally? A: Anthony Capuano, President and CEO, mentioned that it's early to see the full impact, but there's energy across the enterprise about streamlined decision-making. The owner and franchisee community is enthusiastic about the empowerment in the continents, which should improve relationships.

Q: Could you expand on the higher investment spending buckets compared to previous expectations? When do you expect technology spending to level off or decline? A: Kathleen Oberg, CFO, explained that higher investment in owned leased properties, particularly in Barbados, is temporary. Post-2025, investment levels should normalize. Technology investments are higher than typical but expected to be reimbursed over time, with charges to owners reflecting repayment.

Q: What is your appetite for additional tuck-in acquisitions this year, or is it more about digesting previous acquisitions? A: Anthony Capuano stated that Marriott will consider tuck-in acquisitions if they identify a gap in their brand portfolio or geographic footprint. However, the majority of growth will be organic.

Q: Can you discuss the implementation and impact of your tech migration? How will it benefit your business going forward? A: Anthony Capuano highlighted that the tech transformation will roll out later this year, benefiting associates, guests, and owners. It will streamline training, enhance guest engagement, and improve revenue opportunities through a new reservations platform.

Q: How do you view the recovery of business transient travel, both in volume and revenue? A: Kathleen Oberg noted that business transient travel has recovered to 2019 levels, with small- and medium-sized businesses rebounding faster than large corporates. While some sectors like finance have fully recovered, large corporates are still behind 2019 levels.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.