Marriott International, Inc. (Nasdaq: MAR) posted higher than anticipated losses and missed revenue estimates on Monday in its second-quarter report.
One of the largest hotel chains in the world said revenue tumbled 72% year-over-year to $1.46 billion on an adjusted loss of $234 million, or 64 cents a share. Analysts polled by FactSet were anticipating revenues of $1.68 billion on a loss of 41 cents a share.
While the results were poor, Marriot said it has been experiencing improvement. After worldwide occupancy rates for the 7 days ended on April 11 “bottomed at 11 percent,” the company has been seeing improvement each week; the figure jumped to 34% for the week ended Aug. 1. Leading the recovery for the Marriot is Greater China, as occupancy rate levels are now reaching 60% in the region compared with 70% in the same period in 2019.
“While Greater China's recovery was originally led by demand from leisure travelers, particularly in resorts and drive-to destinations, we are now seeing more widespread business demand, including some group activity,” Arne M. Sorenson, the president, and chief executive officer of Marriott, said in a statement today.
He added, "The improvement we have seen in Greater China exemplifies the resilience of travel demand once there is a view that the virus is under control and travel restrictions have eased. Our other regions around the world have also experienced steady improvements in demand and RevPAR over the last couple of months, though the pace varies and tends to be slower in regions that depend more on international travelers."
By midday, the stock in Marriot was trading 86 cents higher than Friday’s close at $94.64 per share. Despite getting hammered by sell-offs this year, Marriot is on track to end higher for the fifth consecutive trading day. The stock has risen 13% since last Monday.
Currently, 91% of Marriot’s hotels are open globally. In North America, 96% of its hotels are open, while all in the Greater China region are open. Its development pipeline includes around 510,000 rooms with 45% of those under construction.
At the end of the quarter, Marriot said its debt amounted to $11.8 billion with net liquidity topping $4.4 billion.