MAR Q2 Deep Dive: International Strength and Brand Expansion Shape Outlook

August 12, 2025 at 23:24 PM EDT

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Global hospitality company Marriott (NASDAQ: MAR) reported revenue ahead of Wall Street’s expectations in Q2 CY2025, with sales up 4.7% year on year to $6.74 billion. Its non-GAAP profit of $2.65 per share was 1% above analysts’ consensus estimates.

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Marriott (MAR) Q2 CY2025 Highlights:

Revenue: $6.74 billion vs analyst estimates of $6.66 billion (4.7% year-on-year growth, 1.2% beat)
Adjusted EPS: $2.65 vs analyst estimates of $2.62 (1% beat)
Adjusted EBITDA: $1.42 billion vs analyst estimates of $1.38 billion (21% margin, 2.4% beat)
Management reiterated its full-year Adjusted EPS guidance of $9.97 at the midpoint
EBITDA guidance for the full year is $5.35 billion at the midpoint, in line with analyst expectations
Operating Margin: 18.3%, in line with the same quarter last year
RevPAR: $136 at quarter end, in line with the same quarter last year
Market Capitalization: $71.94 billion

StockStory’s Take

Marriott’s second quarter results were driven by international market strength and steady contributions from its luxury portfolio, even as U.S. and Canada growth moderated. Management pointed to robust demand in Asia-Pacific and EMEA regions, with CEO Anthony Capuano highlighting, “RevPAR in APAC rose 9%, driven by strong ADR growth and higher demand from international guests.” While the select service segment in the U.S. and Canada saw declines, luxury properties continued to outperform, offsetting some of the regional softness. The overall market response to the quarter was neutral, reflecting results that largely aligned with expectations.

Looking forward, Marriott’s guidance is shaped by continued international expansion, new brand launches, and a cautious outlook on U.S. and Canada demand. Management expects global RevPAR growth to remain at the lower end of its range, with CFO Kathleen Oberg noting, “Our full year RevPAR growth is still expected to be meaningfully stronger internationally than in the U.S. and Canada.” Ongoing investment in technology, the global rollout of new brands such as Series by Marriott, and an expanding loyalty program are viewed by leadership as key levers for sustaining growth against a backdrop of economic uncertainty.

Key Insights from Management’s Remarks

Management attributed the quarter’s performance to international growth, luxury segment strength, and ongoing development pipeline momentum, while also noting softness in select U.S. segments.

International RevPAR gains: Strong demand in Asia-Pacific and EMEA regions led to notable growth, with APAC RevPAR up 9% and EMEA up 7%. Management credited higher average daily rates and increased inbound travel, particularly in markets like Japan and Australia.
Luxury and premium segment resilience: The luxury portfolio saw RevPAR rise 4% and contributed to overall stability, as higher-end properties outperformed lower-tier segments. Food and beverage spend also grew, especially within luxury, supporting broader revenue streams.
U.S. select service softness: RevPAR in U.S. and Canada select service and extended stay hotels declined by 1.5%, with management citing weaker government and small business demand as primary factors. Group business was also described as choppy, with fewer near-term bookings and higher attrition rates.
Development and conversions pipeline: Marriott’s pipeline reached a new high, with 590,000 rooms and conversions making up nearly 30% of signings and openings. Recent launches, such as Series by Marriott and the acquisition of citizenM, signal an emphasis on broadening brand reach.
Technology and AI investment: Ongoing transformation of loyalty, reservations, and property management systems aims to streamline operations and guest experiences. The Marriott AI incubator is piloting new tools, like an AI-powered concierge, with early guest feedback described as positive.

Drivers of Future Performance

Marriott’s outlook is underpinned by international momentum and new brand initiatives, but tempered by persistent softness in certain U.S. segments and macroeconomic uncertainty.

International growth focus: Management expects international RevPAR and net room growth to outpace U.S. and Canada performance, especially in APAC and EMEA. Expansion of mid-scale and luxury brands, along with strong signings in Greater China, are expected to drive long-term growth.
Brand and product expansion: The introduction of Series by Marriott and integration of citizenM are intended to diversify the portfolio and attract value-conscious and lifestyle travelers. These initiatives are expected to boost rooms growth and strengthen the loyalty program.
Technology as an enabler: Marriott’s ongoing technology transformation, including cloud-based reservations and AI-driven guest services, aims to enhance operational efficiency and guest satisfaction. While these projects require elevated investment through 2026, management views them as foundational for future revenue and margin improvement.

Catalysts in Upcoming Quarters

In upcoming quarters, the StockStory team is watching (1) whether international RevPAR and net rooms growth continue to outpace U.S. trends, (2) the impact of new brand launches and conversions on portfolio diversity and loyalty member engagement, and (3) evidence of technology transformation translating into improved margins or guest satisfaction. The progress of the Marriott Media Network and group business booking pace will also be important markers.

Marriott currently trades at $265.06, up from $259.39 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).

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