How will the new co-brand agreements ramp over time, and are there any changes regarding new cards or geographies?

The $30 million incremental impact for 2026 is for a partial year. The full benefit is expected to build over time as new and refreshed card products are introduced, which typically takes several quarters. By full year 2028, the impact on Marriott's co-brand card fees could be $100 million to $125 million. The majority of benefits go to the loyalty program, owners, and guests. “I think the way you should be thinking about it is by full year 2028, the impact on Marriott's co-brand card fees from these new deals could be somewhere between $100 million and $125 million at our current royalty rate of 26%.”

What are the initial thoughts on net rooms trends into 2027, and what is the recent feedback from developers regarding their appetite for new deals?

The guide to the lower end of the 2026 net rooms range is due to Middle East project delays. A multi-year CAGR of 5.2% since end of 2023 is more instructive. Developer sentiment is strong, evidenced by record global signings in the first half of 2026, indicating confidence in investing in Marriott's brands. “We signed more deals in the first half of 2026 than in any first half of the year ever. And so I think that is a great testament to the confidence that the owner and franchisee community has investing in our portfolio of brands long term.”

Can you unpack trends in key money, the stage of digital tech transformation (DTT), and future investment spend expectations?

Key money is a competitive tool, with nearly 40% of pipeline rooms in top quality tiers requiring more key money. Marriott uses less key money per deal than peers due to brand strength. DTT is in early phases of deployment with excellent progress, and its spend will decrease over time, though tech investment will continue. Key money will likely grow with system size, while owned/leased renovations are ongoing. “We're making excellent progress. We're still in the early phases of deployment. We have over 2,000 slot service in U.S., Canada, hotels that have transitioned. And if you think about your third question in terms of what to expect for investment spending going forward, obviously, if we're too early to talk about 2027, but maybe a little bit of color on each of the buckets. On tech and DTT spend, that over time will go down, but we will continue to invest in technology, given the critical importance that it has in our business.”

MAR

Marriott International (MAR) Q2 FY26 earnings call: guidance and Q&A

Q: Can you elaborate on the ITR program and the broader owner reinvestment strategy, including timing and long-term impact?

Management emphasized the importance of owner success and the collaborative discussions with the owner community. The ITR incentive is one step to improve owner economics and benefits all constituents. The ITR program, offering up to 50 basis points of gross room revenue fee reimbursement for achieving ITR thresholds, is launching this week and will impact the owned and leased line for the back half of the year. “We're very focused on hotel level economics. And that really means looking at every variable in the equation and looking for opportunities, both to drive improvement in top line and look at every element of expenses and see if there are opportunities to drive margins and as a result, ultimately drive returns.”

Earnings call· Jun 2026 (Q2 FY26)· Consumer Discretionary· Aug 3, 2026

Source: earnings call transcript

Executive summary

Marriott International Q2 FY26 — Strong RevPAR Growth and Raised Full-Year Guidance

Marriott delivered a very strong Q2 FY26, surpassing prior expectations with robust global RevPAR growth and significant increases in adjusted EBITDA and EPS. The company raised its full-year guidance, driven by broad-based demand across most regions, while actively managing headwinds from the Middle East conflict. Strategic initiatives, including new co-branded credit card agreements and enhanced owner support, are expected to further strengthen the business and loyalty ecosystem.

Highlights

Global RevPAR rose 3.4% in Q2 FY26, with U.S. and Canada RevPAR up 5%, marking its highest quarterly increase in 13 quarters.
Adjusted diluted EPS increased 20% year-over-year to $3.19 in Q2 FY26.
Adjusted EBITDA grew 13% year-over-year to $1.59 billion in Q2 FY26.
The global development pipeline expanded nearly 7% year-over-year to a new record of approximately 629,000 rooms at the end of June.
New long-term co-branded credit card agreements in the U.S. are expected to drive significant value, with an incremental $30 million impact to 2026 fees and $100 million to $125 million by FY28.

Concerns

Middle East RevPAR declined 43% in Q2 FY26 due to regional conflict, contributing to a 5% decline in EMEA RevPAR.
Full-year net rooms growth is now expected towards the low end of the 4.5% to 5% range, primarily due to construction delays in the Middle East.
Owned, leased, and other revenue, net of expenses, decreased to $49 million in Q2 FY26 from $78 million in the prior year, impacted by a $27 million property-related litigation accrual.
Lower expectations for fees in Japan due to the decline in the yen partially offset gains from new co-branded credit card deals.

Guidance & targets

Category	Target	Timeline	Confidence
Full year global RevPAR growth	3% to 3.5% high materiality	FY26	High
Third quarter global RevPAR growth	3.5% to 4% medium materiality	Q3 · FY26	High
Full year Greater China RevPAR growth	2% to 3% medium materiality	FY26	Medium
Full year gross fee revenues	$6.03 billion to $6.06 billion high materiality	FY26	High
Full year Incentive Management Fees (IMF) growth	3% to 5% medium materiality	FY26	High
Full year global credit card fees growth	high 30% range medium materiality	FY26	High
Full year residential branding fees increase	55% to 65% low materiality	FY26	High
Full year owned, leased and other revenue, net of expenses	$175 million to $185 million medium materiality	FY26	High
Full year G&A expense increase	1% to 3% low materiality	FY26	High
Full year adjusted EBITDA increase	11% to 12% high materiality	FY26	High
Full year adjusted effective tax rate	26% to 26.5% low materiality	FY26	High
Full year adjusted diluted EPS growth	16% to 18% high materiality	FY26	High
Third quarter gross fees growth	10% to 11% medium materiality	Q3 · FY26	High
Third quarter Incentive Management Fees (IMF) growth	high single-digit to 10% range medium materiality	Q3 · FY26	High
Third quarter adjusted EBITDA increase	7% to 9% medium materiality	Q3 · FY26	High
Full year investment spending	$1.25 billion to $1.35 billion medium materiality	FY26	High
Full year shareholder returns	over $4.5 billion high materiality	FY26	High
Net rooms growth	mid-single-digit range high materiality	next few years	High
Full year 2026 net rooms growth	low end of 4.5% to 5% range high materiality	FY26	High
Impact of new credit card deals on Marriott's co-brand card fees	$100 million to $125 million high materiality	FY28	Medium

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Global Second quarter global RevPAR rose 3.4%.	—	3.4%	—	—
U.S. and Canada RevPAR rose 5%, the highest quarterly increase in 13 quarters. Strength was pervasive across chain scales. Luxury RevPAR: up over 9%Select service RevPAR: increasing over 4%	—	5%	—	—
EMEA RevPAR declined just over 5% as solid performance in Europe was offset by a meaningful decline in the Middle East.	—	-5%	—	—
Europe RevPAR rose over 4%, driven by strength in leisure, particularly in Mediterranean countries.	—	4%	—	—
Middle East RevPAR declined 43%, a bit better than prior expectations on better-than-expected domestic leisure demand.	—	-43%	—	—
APAC RevPAR rose over 5%, surpassing previous expectations thanks to improved flight capacity and strong intraregional demand.	—	5%	—	—
Greater China RevPAR rose over 3%, led by strong inbound leisure demand recovery. Luxury, Hong Kong, Taiwan, and Hainan were key drivers.	—	3%	—	—
CALA RevPAR rose 3%, driven by strong luxury and leisure demand across the Caribbean.	—	3%	—	—

MAR operating KPIs by quarter

MAR operating KPIs stated on its earnings calls, by fiscal quarter
KPI	Dec 2024 Q4 FY24	Mar 2025 Q1 FY25	Sep 2025 Q3 FY25	Dec 2025 Q4 FY25	Mar 2026 Q1 FY26	This call Jun 2026 Q2 FY26	Change vs prior quarter
Rooms	1.7M+ Our industry-leading global lodging portfolio now goes over 1.7 million rooms across 144 countries and territories. Source: earnings call transcript	—	1.75M+ Development activity remained strong, and we grew our industry-leading global portfolio of rooms by 4.7% year-over-year to over 1.75 million rooms across more than 9,700 properties at the end of September. Source: earnings call transcript	<1.78M With rooms growth as one of the top company priorities, I'm proud that Marriott's industry-leading global portfolio stood at nearly 1.78 million rooms across more than 9,800 properties in 145 countries and territories at the end of December. Source: earnings call transcript	—	1.8M+ We grew net rooms by 4.5% over the 12 months ending June 30, further expanding our industry-leading global portfolio to over 1.8 million rooms across more than 10,000 properties. Source: earnings call transcript	—
Development pipeline rooms	577K+ With a record of over 1,200 deals signed last year, we ended the year with over 577,000 rooms in our pipeline. Source: earnings call transcript	587K+ Our pipeline totaled a record of over 587,000 rooms at the end of the quarter with 42% of pipeline rooms under construction. Source: earnings call transcript	596K+ Our pipeline grew to a new high of more than 596,000 rooms at quarter end with over 250,000 pipeline rooms under construction. Source: earnings call transcript	610K At the end of December, our pipeline had grown to a record 610,000 rooms, up 2% from the prior quarter and up 6% from the prior year. Source: earnings call transcript	<618K Our global pipeline rose over 5% year-over-year to a new record of nearly 618,000 rooms at the end of the quarter, with 43% of pipeline rooms under construction, including rooms that are pending conversion. Source: earnings call transcript	~629K Our global pipeline grew nearly 7% year-over-year to a new record of approximately 629,000 rooms at the end of June. Source: earnings call transcript	—
Loyalty program members	<228M We added over 31 million new members to our loyalty program last year, growing to nearly 228 million members at year-end. Source: earnings call transcript	<237M Our powerful industry-leading Marriott Bonvoy loyalty program had nearly 237 million members at the end of March. Source: earnings call transcript	<260M Membership grew to nearly 260 million members at the end of September, up 18% year-over-year. Source: earnings call transcript	271M Last year alone, 43 million new members joined Bonvoy, propelling the membership base to 271 million members worldwide at year-end. Source: earnings call transcript	<283M Our powerful industry-leading Marriott Bonvoy loyalty program had nearly 283 million members at the end of March. Source: earnings call transcript	295M+ the continued growth of our global lodging system and the powerful combination of scale and engagement represented by our cardholders and more than 295 million loyalty program members. Source: earnings call transcript	—
Properties	—	—	9,700+ Development activity remained strong, and we grew our industry-leading global portfolio of rooms by 4.7% year-over-year to over 1.75 million rooms across more than 9,700 properties at the end of September. Source: earnings call transcript	9,800+ With rooms growth as one of the top company priorities, I'm proud that Marriott's industry-leading global portfolio stood at nearly 1.78 million rooms across more than 9,800 properties in 145 countries and territories at the end of December. Source: earnings call transcript	—	10K+ We grew net rooms by 4.5% over the 12 months ending June 30, further expanding our industry-leading global portfolio to over 1.8 million rooms across more than 10,000 properties. Source: earnings call transcript	—

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

Product	Type	Timeline	Details
Series by Marriott	launch	first openings expected later this year
AI-powered conversational search experience	launch	phased rollout began in June

Deals & partnerships

JPMorgan Chase and American Express New long-term agreements for co-branded credit card program in the U.S. long-term

Reflects the strength of the Marriott Bonvoy brand and the value of its portfolio, driving significant value across the ecosystem.

Unnamed partner (in Greater China) Strategic agreement to introduce Series by Marriott to Greater China.

A multiunit deal to expand the Series by Marriott brand in a key growth market.

Risks & headwinds

Middle East conflict Q2 FY26, continuing into H2 FY26

RevPAR declined 43% in Q2 FY26; expected to impact full year global RevPAR by ~100 bps.

Mitigation:Focus on domestic leisure demand in the Middle East; expectation for business to pick up quickly when conflict resolves.

Construction delays in Middle East FY26

Full year net rooms growth expected at low end of 4.5% to 5% range.

Property-related litigation accrual Q2 FY26

$27 million impact in Q2 FY26.

Lower expectations for fees in Japan FY26

Partially offsets gains from new U.S. co-branded credit card deals.

Midterm elections Q4 FY26

Small negative impact on Q4 U.S. and Canada RevPAR.

Difficult comparisons for Middle East in Q4 2025 Q4 FY26

Q4 2025 had several large events driving meaningful ADR increases, making Q4 2026 comparisons challenging.

Mitigation:Anticipating recovering occupancy, but ADR will be up against strong prior-year comps.

What to watch in Q3 FY26

Middle East RevPAR recovery

Q3/Q4 FY26

Current -43% in Q2 FY26

Target Improvement in Q3/Q4 FY26

Why it matters

The Middle East conflict significantly impacted EMEA results; its recovery is crucial for international performance and overall guidance.

EMEA is expected to continue to be impacted by the conflict in the Middle East, though to a lesser extent than previously anticipated. Year-over-year RevPAR in EMEA is expected to improve in the third quarter relative to the second quarter before moderating again in the fourth quarter.

Find out whether MAR delivers this. Inve re-checks your case every morning.

Q&A highlights

Can you elaborate on the ITR program and the broader owner reinvestment strategy, including timing and long-term impact?

Management emphasized the importance of owner success and the collaborative discussions with the owner community. The ITR incentive is one step to improve owner economics and benefits all constituents. The ITR program, offering up to 50 basis points of gross room revenue fee reimbursement for achieving ITR thresholds, is launching this week and will impact the owned and leased line for the back half of the year.

“We're very focused on hotel level economics. And that really means looking at every variable in the equation and looking for opportunities, both to drive improvement in top line and look at every element of expenses and see if there are opportunities to drive margins and as a result, ultimately drive returns.”

asked by Shaun Kelley · answered by Anthony Capuano

2 min read 5 chapters

Detailed narrative

Owner Relations and Hotel-Level Economics

Marriott emphasized its deep appreciation for its owners, recognizing their foundational role in the business. The company is intensely focused on strengthening hotel-level economics and driving owner returns, implementing productivity enhancements from prior efficiency exercises. Specific steps include lowering royalty charge-out rates across the global system by approximately 5%, enhancing owner reimbursement for Bonvoy redemption stays on high-demand nights, and introducing streamlined brand standards and flexible renovation scopes.

A new 'intend to recommend' (ITR) incentive program will provide fee discounts for top hotels achieving strong guest satisfaction scores in the U.S. and Canada, viewed as a reinvestment benefiting owners and enhancing brand equity.

Co-branded Credit Card Agreements

Marriott recently executed new long-term agreements for its U.S. co-branded credit card program with JPMorgan Chase and American Express. These agreements reflect the strength of the Marriott Bonvoy brand, the value of its portfolio, and the scale of its loyalty program.

The new economics and cardholder benefits are expected to drive significant value across the Marriott Bonvoy ecosystem, including for hotel owners and loyalty members. The incremental impact to 2026 co-branded credit card fees from a partial year of the new terms is approximately $30 million, with the full benefit expected to build to $100 million to $125 million by FY28 as new card products are introduced.

Technology Transformation and AI Adoption

Marriott is making significant progress in its multiyear technology transformation, increasingly leveraging AI across the enterprise. The goal is to deliver revenue to owners more efficiently, elevate the guest experience, and automate workflows for associates. In June, the company began a phased rollout of an AI-powered conversational search experience on marriott.com and the Marriott Bonvoy app, demonstrating its commitment to using technology for enhanced customer experience and operational efficiency.

Marriott is also collaborating with Google and other leading AI platform providers as their travel search and commerce tools evolve.

Development Pipeline and Conversions Momentum

The company reported record global signings in the first half of the year, with its global pipeline growing nearly 7% year-over-year to a new record of approximately 629,000 rooms at the end of June. Marriott leads the industry with over 279,000 rooms under construction.

Conversions, including multiunit deals, remain a significant driver of growth, representing 34% of signings and 40% of openings in the first half. A notable multiunit deal involves introducing Series by Marriott to Greater China, with plans to add approximately 100 hotels and the first openings expected later this year.

Regional Performance Dynamics

While global RevPAR rose 3.4%, regional performance showed divergence. U.S. and Canada RevPAR increased 5%, its highest quarterly rise in 13 quarters, with strength across luxury and select service. In contrast, international RevPAR declined slightly, primarily due to a 43% drop in the Middle East from regional conflict, which offset solid 4% growth in Europe.

APAC RevPAR rose over 5%, with Greater China up over 3%, driven by improved flight capacity, strong intraregional demand, and inbound leisure recovery.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.