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    MAR
    Earnings call· Mar 2026(Q1 FY26)

    MARRIOTT INTERNATIONAL INC /MD/ Q1 FY26 earnings call MAR

    May 6, 2026 Source

    Executive summary

    Marriott International Q1 FY26 — Strong RevPAR and Raised Full-Year Guidance

    Marriott delivered strong first-quarter performance, with RevPAR and financial results surpassing expectations, driven by broad-based strength in the U.S. and Canada and robust international activity. The company raised its full-year global RevPAR and earnings guidance, reflecting this momentum despite anticipated headwinds from the Middle East conflict. Strategic initiatives in development, technology, and loyalty continue to drive growth and enhance owner value, with a focus on expanding the global footprint and leveraging AI for improved customer experience and operational efficiency.

    Highlights

    6

    • Global RevPAR rose 4.2% in Q1, exceeding the top end of guidance ranges.

    • Record first quarter global signings contributed to a 5% YoY pipeline increase to nearly 618,000 rooms.

    • Net rooms growth was 4.5% over the trailing 12 months through March.

    • Adjusted EBITDA increased 15% to $1.4 billion in Q1.

    • Adjusted diluted EPS rose 17% to $2.72 in Q1.

    • U.S. and Canada RevPAR increased 4%, with select service RevPAR improving significantly to 3.5% growth.

    Concerns

    4

    • The conflict in the Middle East led to a RevPAR decline of over 30% in the region in March.

    • The Middle East conflict is expected to impact full-year global RevPAR growth by 100 to 125 basis points.

    • Lower than previously anticipated RevPAR growth is expected in APAC (due to long-haul demand) and CALA (primarily Mexico).

    • Second quarter Incentive Management Fees (IMFs) are expected to be down in the mid-single-digit range, driven by significant declines in the Middle East.

    Guidance & targets

    22
    CategoryTargetConfidence
    Full-year global RevPAR growth
    2% to 3%
    high materiality
    High
    Full-year gross fee revenue
    $5.93 billion to $5.99 billion
    high materiality
    High
    Full-year Incentive Management Fees (IMF) growth
    around flat year-over-year
    medium materiality
    Medium
    Full-year co-branded credit card fees growth
    around 35%
    medium materiality
    High
    Full-year residential branding fees growth
    around 45% to 50%
    medium materiality
    High
    Full-year timeshare fees
    $110 million to $115 million
    low materiality
    High
    Full-year owned leased and other revenue, net of expenses
    $215 million to $225 million
    medium materiality
    Medium
    Full-year G&A expense growth
    1% to 3%
    medium materiality
    High
    Full-year adjusted EBITDA growth
    9% to 11%
    high materiality
    High
    Full-year adjusted effective tax rate
    26% and 26.5%
    low materiality
    High
    Full-year adjusted diluted EPS
    $11.38 to $11.63
    high materiality
    High
    Q2 global RevPAR growth
    1.5% to 2.5%
    medium materiality
    Medium
    Q2 gross fees growth
    10% to 11%
    medium materiality
    Medium
    Q2 Incentive Management Fees (IMF) growth
    down in the mid-single-digit range
    medium materiality
    Medium
    Q2 adjusted EBITDA growth
    8% to 10%
    medium materiality
    Medium
    Full-year investment spending
    around $1.05 billion to $1.15 billion
    medium materiality
    High
    Capital return to shareholders
    over $4.4 billion
    high materiality
    High
    Full-year net rooms growth
    between 4.5% and 5%
    high materiality
    High
    Impact of Middle East conflict on full-year global RevPAR growth
    100 to 125 basis points
    high materiality
    Medium
    Impact of World Cup on full-year global RevPAR growth
    30 to 35 basis points
    medium materiality
    High
    Full-year Greater China RevPAR growth
    low single-digit range
    medium materiality
    High
    Q2 Middle East RevPAR reduction
    about 50%
    high materiality
    Medium

    Segment performance

    7
    SegmentRevenueYoYQoQMargin
    Global
    RevPAR growth above guidance ranges.
    		—+4.2%——
    U.S. and Canada
    Strength was broad-based across segments and chain scales, with significant improvement in select service from Q4.
    Luxury RevPAR growth: +7%Select Service RevPAR growth: +3.5%
    		—+4%——
    International
    Growth despite Middle East conflict weighing on results in March.
    		—+4.6%——
    APAC
    Driven by strong ADR growth and increased demand from Chinese guests. Select markets impacted by Middle East travel corridor disruption starting in March.
    		—over 7%——
    Greater China
    Hotels gained market share, stronger leisure demand, led by strong ADR growth in Hong Kong and Hainan Island.
    Hong Kong RevPAR growth: +20%Hainan Island RevPAR growth: +20%
    		—nearly 6%——
    CALA
    Led by record leisure results in the Caribbean, partially offset by a decline in RevPAR at Mexican luxury resorts.
    		—+2%——
    EMEA
    Increases in Europe and Africa partially offset by a decline in the Middle East. Impact on European markets was minimal and largely contained to countries near the Middle East.
    Middle East RevPAR decline (March): over 30%Europe RevPAR growth: +4%
    		—over 3%——

    Operational metrics

    15
    Total gross fee revenues
    $1.43 billion+12% YoY
    Q1 2026

    Reflecting higher RevPAR, rooms growth, and increases in co-branded credit card and residential branding fees.

    Co-branded credit card fees growth
    +37%YoY
    Q1 2026

    Contributed to total gross fee revenue growth.

    Residential branding fees growth
    over 70%YoY
    Q1 2026

    Contributed to total gross fee revenue growth.

    Owned leased and other revenue, net of expenses growth
    +21%YoY
    Q1 2026

    Due to higher termination fees and strong results at Elegant Hotels in Barbados and other portfolio hotels.

    G&A expense growth
    +5%YoY
    Q1 2026

    Primarily due to timing of compensation costs, partially offset by lower litigation expenses.

    Co-branded credit cards
    37
    Current

    Recently launched cards in Indonesia and Brazil.

    Hotels transitioned to new tech ecosystem
    1,000
    Current

    Part of multi-year technology transformation.

    Investment in contracts as % of total investment spending
    35% to 40%
    Full Year 2026

    Expected allocation of investment spending.

    Digital tech transformation spend as % of total investment spending
    30% to 35%
    Full Year 2026

    Overwhelming portion expected to be reimbursed over time.

    Middle East accounts for open rooms
    3%
    Current

    Context for impact of Middle East conflict.

    Middle East accounts for pipeline rooms
    7%
    Current

    Context for impact of Middle East conflict.

    Middle East accounts for global gross speeds
    3%
    Full Year 2025

    Context for impact of Middle East conflict.

    Middle East hotels yet to open this year as % of full year expected net rooms openings
    4%
    Full Year 2026

    Indicates limited direct impact on overall net rooms growth from Middle East openings.

    Mid-scale hotels (open and pipeline)
    500
    Current

    Achieved since entering the segment a couple of years ago.

    Middle East accounts for global transit traffic demand
    10%
    Current

    Explains ripple effect of conflict on travel, particularly for markets like India.

    Industry KPIs

    5
    MetricValueDetails
    Fee revenue streams$222 millionUSD
    Comparable sales comps+4.2%%
    Loyalty program members tier mixnearly 283 millionmembers
    Group booking pace booking window+5%%
    Net unit growth development pipeline4.5%%

    Product announcements

    2
    ProductTypeDetails
    Lefaylaunch
    Natural language search experiencelaunch

    Deals & partnerships

    2
    Sun Grouppartnershipover the next few years

    Agreement to add 10 hotels across 8 brands in Vietnam.

    Series by Marriott (Europe)partnership

    Signed 6 projects in Italy and 5 in the United Kingdom for the regionally rooted collection brand.

    Risks & headwinds

    5
    Middle East conflictOngoing through year-end 2026, with most severe decline in Q2

    Middle East RevPAR declined over 30% in March; expected to impact full-year global RevPAR by 100-125 basis points; Q2 Middle East RevPAR expected down ~50%.

    Mitigation: Focus on associate and guest safety; monitoring fluidity of situation; expecting sequential recovery in Q3/Q4.

    Softer long-haul demandNear-term

    Lower than previously anticipated RevPAR growth in APAC.

    Mitigation: Expecting impact to soften as other carriers fill lost capacity from Middle East carriers.

    Decline in Mexican luxury resortsQ1 2026

    Partially offset CALA RevPAR growth of 2%.

    Midterm elections impact on U.S. and Canada RevPARQ4 2026

    Expected impact.

    Renovations at owned/leased hotelsFull Year 2026

    Impacted owned leased and other revenue, net of expenses.

    Q&A highlights

    8

    What are the key drivers of the recent strength in U.S. RevPAR, particularly the resurgence in activity and improvement in the low-end segments?

    Tony Capuano highlighted broad-based strength across segments (leisure, group, business transient excluding government) and chain scales (luxury, select service, which saw 3.5% RevPAR growth). He noted continued strength in April and the positive impact of the World Cup.

    “one of the things that's encouraging is it's really across segments, right? We talked in our prepared remarks about the continued strength in leisure. Group continues to be solid. And if you exclude government, business transient is pretty solid as well.”

    asked by Shaun Kelley · answered by Anthony Capuano

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 Performance Exceeds Expectations

    Marriott reported robust first-quarter results, with global RevPAR increasing 4.2%, surpassing the high end of its guidance. This strong performance was broad-based, with U.S. and Canada RevPAR up 4% and international RevPAR up 4.6%. Notably, select service RevPAR in the U.S. and Canada improved significantly to 3.5% growth, indicating strength across various chain scales. Adjusted EBITDA grew 15% to $1.4 billion, and adjusted diluted EPS rose 17% to $2.72.

    02

    Robust Development and Pipeline Growth

    The company achieved record global signings in Q1, contributing to a 5% year-over-year increase in its global pipeline, which now stands at nearly 618,000 rooms. Conversions remain a key growth driver, accounting for over 35% of signings and more than 40% of openings during the quarter. Marriott continues to expect net rooms growth between 4.5% and 5% for the full year, underscoring its commitment to expanding its industry-leading portfolio worldwide.

    03

    Advancements in Technology and AI Integration

    Marriott's multi-year technology transformation is progressing well, with 1,000 hotels successfully transitioned to its new tech ecosystem. The company is actively leveraging AI to enhance operations and customer experience, including AI-powered desktop assistance in customer engagement centers and guest pre-arrival communications. A phased rollout of a robust natural language search experience on marriott.com and its app is planned by the end of Q2, aiming to improve direct booking channels and customer engagement.

    04

    Loyalty Program and Co-branded Card Expansion

    The Marriott Bonvoy loyalty program continues to grow, reaching nearly 283 million members by the end of March. Marriott is expanding its co-branded credit card offerings globally, now with 37 cards across 13 countries, including recent launches in Indonesia and Brazil. This strategy aims to drive direct bookings, foster repeat stays, and deliver value to owners across its global system.

    05

    Regional Performance and Middle East Headwinds

    While APAC RevPAR rose over 7% driven by strong ADR and Chinese demand (Greater China up 6%), the Middle East conflict significantly impacted results, with RevPAR in the region declining over 30% in March. This conflict is expected to reduce full-year global RevPAR growth by 100-125 basis points, with Q2 Middle East RevPAR projected to be down approximately 50%. Outlooks for APAC (near-term long-haul demand) and CALA (Mexico) were slightly reduced, while Greater China's outlook was raised.

    06

    Customer Segment Trends and U.S. Strength

    Globally, leisure RevPAR increased 6%, group RevPAR rose 5%, and business transient📎 RevPAR was up 1%, primarily driven by higher ADR despite a 2% decline in room nights. In the U.S. and Canada, all segments showed strength, with leisure up 5% and group up 5%. The company noted a positive shift towards domestic and drive-to destinations, benefiting lower chain scales, and continued consumer prioritization of travel experiences.

    AI-generated summary of the company’s earnings call. Not investment advice.