Hotels' Occupancy Rate Falls 0.1% YoY Amid Weak Summer Demand.

The US hotel industry reported a 0.1% decrease in occupancy rate year-over-year, with a 0.5% increase in average daily rate (ADR) and a 0.4% increase in revenue per available room (RevPAR). The 4-week average occupancy rate is tracking behind last year and the median rate for the period 2000-2024, and is expected to decrease seasonally.

Marriott International, Inc. (MAR) reported its second-quarter 2025 results, showcasing strong financial performance despite macroeconomic uncertainties. The company's adjusted earnings per share (EPS) of $2.65 beat the Zacks Consensus Estimate of $2.64, marking the third consecutive quarter of earnings beat. Quarterly revenues of $6,744 million also surpassed expectations, growing by 5% year-over-year.

The company's global revenue per available room (RevPAR) rose, primarily driven by the leisure segment. Base management and franchise fees increased, supported by room additions, higher RevPAR, and increased credit card contributions. Marriott completed the acquisition of citizenM, which is expected to bolster its global growth prospects.

Marriott's development pipeline remains robust, with nearly 32,000 rooms signed during the quarter, of which more than 70% were in international markets. The company ended the quarter with a record pipeline of over 590,000 rooms, indicating strong momentum in its expansion strategy.

Despite the challenges posed by the U.S. hotel industry, which reported a 0.1% decrease in occupancy rate year-over-year [2], Marriott maintained its strong performance. The company expects worldwide system-wide RevPAR to increase by 1.5-2.5% year-over-year in 2025, compared to the prior estimate of 1.5-3.5% growth.

Key Metrics:
- Adjusted EPS: $2.65 (beat estimate of $2.64)
- Quarterly Revenues: $6,744 million (5% YOY growth)
- RevPAR: Increased year-over-year
- Development Pipeline: 590,000 rooms

Outlook:
Marriott anticipates gross fee revenues in the range of $1.310-$1.325 billion for the third quarter, with adjusted EBITDA expected to be between $1.288 billion and $1.318 billion. For 2025, the company expects its gross fee revenues to be $5.365-$5.420 billion, with adjusted EBITDA anticipated to be between $5.310 billion and $5.395 billion. The company's EPS is expected to be between $9.85 and $10.09.

References:
[1] https://www.tradingview.com/news/zacks:931173f92094b:0-marriott-stock-up-as-q2-earnings-beat-estimates-revpar-rises-y-y/
[2] https://www.calculatedriskblog.com/2025/08/hotels-occupancy-rate-decreased-01-year.html