Marriott International – the largest hotel company in the world – cut its full-year forecast for revenue growth and profit as travel demand in the US slows, the company said on Tuesday.
Total room revenue in the US and Canada was flat for the second quarter, up just 1%, compared to a year ago, the Bethesda, Md.-based reported.
The slowdown is mostly hitting its lower-cost hotels that include Marriott Courtyard, Fairfield Inn and SpringHill Suites, which were also hard hit by a 17% decline in bookings from government workers, the company said.
“The low end of the travel segment is underperforming across the board right now,” Morningstar analyst Dan Wasiolek said. “There is still elevated inflation in areas of the economy that is impacting budget-conscious customers.”
Marriott said it now expects 2025 revenue growth of 1.5% to 2.5%, below its previous guidance of 1.5% to 3.5% growth. It also lowered its profit guidance to $9.82 to $10.08 per share down, from $9.85 to $10.08.
The company blamed “heightened macro-economic uncertainty” due to trade policy changes.
Marriott’s luxury hotel brands, including the Ritz-Carlton, St. Regis and JW Marriott, saw a 4.1% increase in room revenue in the US and Canada in second the quarter.
The average room rate for luxury properties was $417 compared with $161 for its budget properties, according to Wasiolek.
Marriott’s total revenue rose 5% to $6.74 billion, fueled by its upscale properties and overseas business.
The company did not address international tourism to the US but there have been widespread reports of a pullback in visitors from Canada, Mexico and other countries due to blowback over President Trump’s tariffs.
Marriott CEO credited the signing of Trump’s Big Beautifull Bill into law last month, for helping to curtail uncertainty that had depressed business.
“In some ways, the best thing about [the bill] is that it’s done. The level of uncertainty, both among consumers and among our owners and franchisees, improves meaningfully with the signature on that bill,” Capuano said on an earnings call.
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