(Reuters) – U.S. hotel chain Marriott International Inc (MAR.O) on Monday cut its fourth-quarter forecast for a key measure of hotel health, blaming uncertainty related to weak demand in North America, its biggest market.
FILE PHOTO – A woman on a mobile phone walks past a Marriott hotel in Hangzhou, Zhejiang province, China January 11, 2018. REUTERS/Stringer
Marriott’s shares fell 4.4 percent, overshadowing a higher-than-expected third quarter profit.
Marriott, which owns the Ritz-Carlton and St. Regis luxury hotel brands, forecast revenue per available room (revPAR) to rise 2 percent across the world in the fourth quarter. It had earlier forecast growth of 2.5 percent to 3 percent.
The Bethesda, Maryland-based company also said it now expects 3 percent growth in full-year revPAR worldwide, at the low end of its earlier forecast of a rise of 3 percent to 4 percent.
Smaller rival Hilton Worldwide Holdings Inc (HLT.N) last month indicated a slowdown in its business by cutting the top end of its full-year revPAR growth target against the backdrop of growing international trade worries.
Additionally, there are concerns that the hotel industry, which has gained from a strong economy and robust travel demand, may be set to decelerate.
Marriott’s net income dropped to $483 million in the quarter ended Sept. 30 from $485 million.
On an adjusted basis, the company earned $1.70 per share, beating analysts’ estimate of $1.31, according to Refinitiv data.
The company’s revenue fell about 1 percent to $5.05 billion, missing estimates of $5.37 billion.
While fewer people booked Marriott rooms across the world in the quarter, the average room rate rose 2.2 percent.
Reporting by Arunima Banerjee in Bengaluru; Editing by Maju Samuel