10-QPeriod: Q3 FY2024

MARRIOTT INTERNATIONAL INC /MD/ Quarterly Report for Q3 Ended Sep 30, 2024

Filed November 4, 2024For Securities:MAR

Summary

Marriott International, Inc. reported solid financial performance for the nine months ended September 30, 2024, with net income of $1.920 billion, a decrease from $2.235 billion in the prior year period. This decline was primarily influenced by higher interest expenses and a shift in earnings to higher tax jurisdictions. Despite the net income dip, the company demonstrated robust revenue growth, with net fee revenues increasing by 7% year-over-year to $3.76 billion for the nine-month period, driven by strong performance across most regions. System-wide RevPAR increased by 4.0% for the first nine months, buoyed by positive trends in occupancy and average daily rates, although Greater China experienced a decline due to macroeconomic factors and increased outbound travel. The company continues to execute its "asset-light" model, focusing on management and franchising, with significant room growth and a robust development pipeline, including a substantial contribution from the MGM Resorts International licensing agreement.

Financial Highlights

43 data points
Beta

Revenue

$6.25B

Net Income

$584.00M

9.3% Net Margin

EPS (Diluted)

$2.07

Total Assets

$26.21B

Cash & Equivalents

$394.00M

Free Cash Flow

$706.00M

Financial Statements
Beta
Revenue$6.25B
Operating Expenses$5.31B
Operating Income$944.00M
Net Income$584.00M
EPS (Basic)$2.08
EPS (Diluted)$2.07
Shares Outstanding (Basic)281.50M
Shares Outstanding (Diluted)282.40M

Key Highlights

  • 1Net income for the first nine months of 2024 was $1.920 billion, down from $2.235 billion in the same period of 2023, primarily due to increased interest expenses and higher tax rates.
  • 2Net fee revenues grew 7% year-over-year to $3.76 billion for the nine months ended September 30, 2024, indicating strong underlying business performance.
  • 3Worldwide RevPAR increased by 4.0% for the first nine months of 2024, with positive contributions from ADR and occupancy, though Greater China showed a decline.
  • 4The company's development pipeline remains strong, with system-wide properties growing by 5% to 9,068 properties (1,674,600 rooms) as of September 30, 2024, including over 77,200 net new rooms added in the first nine months.
  • 5Marriott initiated a comprehensive cost-efficiency program expected to yield $80-$90 million in annual G&A cost reductions starting in 2025.
  • 6The company repurchased 4.5 million shares for $1.0 billion in the third quarter of 2024 and returned $506 million in dividends, underscoring a commitment to shareholder returns.

Frequently Asked Questions

The decrease in net income for the first nine months of 2024 to $1.920 billion from $2.235 billion in 2023 was primarily influenced by higher interest expenses, which increased by $103 million, and a shift in earnings to jurisdictions with higher tax rates, impacting the effective tax rate.

Marriott launched a comprehensive initiative to enhance effectiveness and efficiency, which is expected to yield $80 million to $90 million in annual general and administrative cost reductions beginning in 2025. This initiative also includes a voluntary retirement program and potential role eliminations or redefinitions.

Marriott continues to expand its global footprint, with system-wide properties increasing by 5% year-over-year to 9,068 properties (1,674,600 rooms) by September 30, 2024. The company added over 77,200 net rooms in the first nine months of 2024, partly due to the MGM Resorts International licensing agreement, and has a substantial development pipeline of approximately 3,800 hotels and 585,000 rooms.

Marriott is committed to returning capital to shareholders through share repurchases and dividends. In the third quarter of 2024, the company repurchased 4.5 million shares for $1.0 billion, and has repurchased a total of 14.2 million shares for $3.4 billion year-to-date through October 31, 2024. Additionally, the company declared and paid quarterly cash dividends.