Marriott International ( MAR ) reported its second-quarter fiscal 2025 earnings on Tuesday.

The company’s second-quarter sales reached $6.74 billion, marking a 4.7% year-on-year increase and surpassing the analyst consensus estimate of $6.64 billion.

Marriott’s comparable systemwide constant-dollar revenue per available room (RevPAR) grew 1.5% year-over-year, while actual dollar RevPAR saw a 1.7% increase.

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Performance in the U.S. and Canada was flat, with RevPAR edging down 0.1% in actual dollars, while international markets saw a 5.3% increase (6.1% in actual dollars).

The company added roughly 17,300 net rooms during the quarter, a 4.7% increase from the end of the second quarter of 2024.

Total expenses declined 5% to $5.51 billion, contributing to an adjusted EBITDA of $1.42 billion, up from $1.32 billion a year ago.

Despite a 3.4% rise in operating income to $1.24 billion, the company’s operating margin fell by 100 basis points to 18%.

Adjusted earnings per share (EPS) of $2.65 outperformed the consensus estimate of $2.62.

At the end of the quarter, Marriott’s global system totaled nearly 9,600 properties, with approximately 1,736,000 rooms. As of June 30, Marriott ( MAR ) held $700 million in cash and equivalents.

In the quarter, Marriott ( MAR ) repurchased 2.8 million shares of common stock for $700 million. Through July 30, the company has returned over $2.1 billion to shareholders through dividends and share repurchases.

CEO Anthony Capuano reported that Marriott ( MAR ) delivered a strong second quarter, posting solid financial results and robust net rooms growth despite ongoing macroeconomic uncertainty, with luxury strength offset by weaker select service demand due to reduced government and business transient travel.

Capuano noted that development activity remained strong, with nearly 32,000 rooms signed, over 70% in international markets, and a record pipeline of more than 590,000 rooms at quarter-end. Conversions accounted for about 30% of signings and openings in the first half of the year, and Marriott ( MAR ) still expects full-year net rooms growth to approach 5%.

He highlighted the launch of Series by Marriott ( MAR ), a new regional brand targeting the midscale and upscale segments, and its founding deal with India’s Fern portfolio. Capuano also pointed to the acquisition of lifestyle brand citizenM as a key expansion, positioning Marriott ( MAR ) better to serve guests, Bonvoy members, and owners globally.

“Our results in the second quarter underscore the resiliency of our cash-generating, asset-light business model and the strength of our brands,” he said.

Outlook

Marriott ( MAR ) revised its 2025 adjusted EPS outlook to $9.85-$10.08 (prior $9.82-$10.19) versus the $10.06 analyst consensus estimate and gross fee revenue of $5.365 billion-$5.420 billion (prior $5.365 billion-$5.475 billion).

The company expects third-quarter adjusted EPS of $2.31-$2.39 against an analyst consensus estimate of $2.48 and gross fee revenue of $1.310 billion-$1.325 billion.

Marriott ( MAR ) stock declined 8% year-to-date amid macroeconomic uncertainties like labor costs and travel demand fluctuations.

Price Action: Marriott ( MAR ) shares traded lower by 0.68% to $257.37 at last check Tuesday.

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