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Marriott International, Inc. (MAR - Free Report) reported mixed second-quarter 2024 results, with adjusted earnings beating the Zacks Consensus Estimate and revenues missing the same. The bottom and top lines increased on a year-over-year basis.
The quarterly results benefited from a solid increase in global travel demand, reflecting worldwide revenue per available room (RevPAR) growth. International RevPAR gained from solid contributions from Asia Pacific, excluding China, while U.S. & Canada RevPAR benefited from growth across all customer segments, reflecting average daily rate (“ADR”) and occupancy uptrend.
The uptrend was also backed by net room growth, asset-light business model, enhancements in the Marriott Bonvoy loyalty program and the Starbucks collaboration announced in June 2024.
Shares of this worldwide hospitality company lost 3.7% in the pre-market trading session on Jul 31, after the announcement of the results. Investors’ sentiments are likely to have been hurt by the reduced 2024 adjusted earnings per share (EPS) outlook.
Earnings & Revenue Discussion
Marriott’s adjusted EPS of $2.50 topped the Zacks Consensus Estimate of $2.49 by 0.4%. It reported adjusted earnings of $2.26 per share in the prior-year quarter.
Quarterly revenues of $6.44 billion missed the consensus mark of $6.5 billion by 0.9%. The top line moved up 6% on a year-over-year basis.
Marriott International, Inc. Price, Consensus and EPS Surprise
Revenues from Base management and Franchise fees were $330 million and $818 million, up 4% and 11% year over year, respectively. Increased RevPAR and unit growth primarily backed this uptick. We estimated the metrics to be $339.7 million and $812.2 million, respectively.
Incentive management fees were $195 million, reflecting a rise of 1% from $193 million reported in the prior-year quarter.
RevPAR & Margins
RevPAR for worldwide comparable system-wide properties rose 4.9% (in constant dollars) year over year. The upside was primarily backed by a 2.6% increase in ADR and a 1.6% increase in occupancy, year over year.
Comparable system-wide RevPAR in the Asia Pacific (excluding China) increased 13% (in constant dollars) year over year. Occupancy moved up 4.3% year over year while ADR rose 6.2% from the 2023 level. Comparable system-wide RevPAR in Greater China declined 4.2% year over year.
On a constant-dollar basis, international comparable system-wide RevPAR increased 7.4% year over year. Occupancy and ADR gained 2.6% and 3.4% year over year, respectively. Comparable system-wide RevPAR in Europe gained 6.6% year over year. RevPAR in the Caribbean & Latin America and Middle East & Africa rose 8.6% and 18.1%, respectively from 2023 levels.
Total expenses increased 5.3% year over year to $5.24 billion, primarily owing to a rise in reimbursed expenses. Our estimate was pegged at $5.2 billion.
Adjusted EBITDA amounted to $1.32 billion, up 9% from the prior-year quarter. We predicted the metric to be $1.3 billion.
Balance Sheet
At the second-quarter end, Marriott's total debt totaled $13.1 billion, up year over year from $11.9 billion and sequentially from $12.7 billion. Cash and cash equivalents, as of Jun 29, 2024, were $0.3 billion compared with $0.4 billion in the previous quarter.
Year to date (through Jul 29), the company repurchased 10.4 million shares worth $2.5 billion.
Unit Developments
At the end of the second quarter, Marriott's worldwide development pipeline totaled 3,509 hotels, with more than 559,000 rooms. As of the quarter's end, about 1,127 properties with more than 209,000 rooms were under construction.
Q3 & 2024 Outlook
For the third quarter, management anticipates gross fee revenues in the range of $1.28-$1.29 billion. Adjusted EBITDA is expected between $1.23 billion and $1.25 billion. MAR estimates third-quarter EPS to be between $2.27 and $2.33.
The company projects worldwide system-wide RevPAR to increase 3-4% year over year.
For 2024, Marriott reduced its gross fee revenue expectations to $5.13-$5.18 billion from the prior expected range of $5.18-$5.28 billion. General and administrative expenses are now projected in the range of $1.02-$1.03 billion (priorly expected between $1.02 billion and $1.04 billion).
Adjusted EBITDA is now expected between $4.95 billion and $5.2 billion compared with the previous expectation of $4.96-$5.1 billion. The company now envisions 2024 EPS in the band of $9.23-$9.40, down from the prior expectation of $9.31-$9.65.
Boyd Gaming Corporation (BYD - Free Report) reported second-quarter 2024 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The company’s top line increased year over year.
Segment-wise, the Las Vegas Locals market showed improvement sequentially. Its business in this segment achieved market share growth. Additionally, the company experienced strong growth in its Downtown Las Vegas operations and maintained stable performance in Midwest and South operations.
Hasbro, Inc. (HAS - Free Report) reported second-quarter fiscal 2024 results, wherein earnings and revenues beat the Zacks Consensus Estimate. Despite a year-over-year revenue decline, earnings increased on the back of a favorable business mix and improved operations.
Net revenues from the Consumer Products and Entertainment segment decreased 20% year over year to $524.5 million and 90% year over year to $18.8 million, respectively. Nonetheless, Wizards of the Coast and Digital Gaming segment’s revenues totaled $452 million, up 20% from $375.6 million in the year-ago quarter. The upside was driven by a higher digital licensing revenue mix and lower royalty expenses.
Royal Caribbean Cruises Ltd. (RCL - Free Report) reported impressive second-quarter 2024 results, wherein earnings and revenues beat the Zacks Consensus Estimate. The bottom and top lines increased on a year-over-year basis. RCL benefited from stronger pricing on close-in demand and continued strength in onboard revenues.
RCL is focused on driving strong shareholder returns by delivering a lifetime of vacations and capturing a larger share of the rapidly growing $1.9 trillion global vacation market. It focuses on disciplined expansion, moderate yield growth and cost control to achieve the same. Furthermore, during the quarter, the company achieved its Trifecta financial goals (18 months ahead of schedule), strengthened its balance sheet and reinstated dividends, thereby enhancing shareholders’ value.
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Marriott (MAR) Q2 Earnings Top, Revenues Miss, '24 View Cut
Marriott International, Inc. (MAR - Free Report) reported mixed second-quarter 2024 results, with adjusted earnings beating the Zacks Consensus Estimate and revenues missing the same. The bottom and top lines increased on a year-over-year basis.
The quarterly results benefited from a solid increase in global travel demand, reflecting worldwide revenue per available room (RevPAR) growth. International RevPAR gained from solid contributions from Asia Pacific, excluding China, while U.S. & Canada RevPAR benefited from growth across all customer segments, reflecting average daily rate (“ADR”) and occupancy uptrend.
The uptrend was also backed by net room growth, asset-light business model, enhancements in the Marriott Bonvoy loyalty program and the Starbucks collaboration announced in June 2024.
Shares of this worldwide hospitality company lost 3.7% in the pre-market trading session on Jul 31, after the announcement of the results. Investors’ sentiments are likely to have been hurt by the reduced 2024 adjusted earnings per share (EPS) outlook.
Earnings & Revenue Discussion
Marriott’s adjusted EPS of $2.50 topped the Zacks Consensus Estimate of $2.49 by 0.4%. It reported adjusted earnings of $2.26 per share in the prior-year quarter.
Quarterly revenues of $6.44 billion missed the consensus mark of $6.5 billion by 0.9%. The top line moved up 6% on a year-over-year basis.
Marriott International, Inc. Price, Consensus and EPS Surprise
Marriott International, Inc. price-consensus-eps-surprise-chart | Marriott International, Inc. Quote
Revenues from Base management and Franchise fees were $330 million and $818 million, up 4% and 11% year over year, respectively. Increased RevPAR and unit growth primarily backed this uptick. We estimated the metrics to be $339.7 million and $812.2 million, respectively.
Incentive management fees were $195 million, reflecting a rise of 1% from $193 million reported in the prior-year quarter.
RevPAR & Margins
RevPAR for worldwide comparable system-wide properties rose 4.9% (in constant dollars) year over year. The upside was primarily backed by a 2.6% increase in ADR and a 1.6% increase in occupancy, year over year.
Comparable system-wide RevPAR in the Asia Pacific (excluding China) increased 13% (in constant dollars) year over year. Occupancy moved up 4.3% year over year while ADR rose 6.2% from the 2023 level. Comparable system-wide RevPAR in Greater China declined 4.2% year over year.
On a constant-dollar basis, international comparable system-wide RevPAR increased 7.4% year over year. Occupancy and ADR gained 2.6% and 3.4% year over year, respectively. Comparable system-wide RevPAR in Europe gained 6.6% year over year. RevPAR in the Caribbean & Latin America and Middle East & Africa rose 8.6% and 18.1%, respectively from 2023 levels.
Total expenses increased 5.3% year over year to $5.24 billion, primarily owing to a rise in reimbursed expenses. Our estimate was pegged at $5.2 billion.
Adjusted EBITDA amounted to $1.32 billion, up 9% from the prior-year quarter. We predicted the metric to be $1.3 billion.
Balance Sheet
At the second-quarter end, Marriott's total debt totaled $13.1 billion, up year over year from $11.9 billion and sequentially from $12.7 billion. Cash and cash equivalents, as of Jun 29, 2024, were $0.3 billion compared with $0.4 billion in the previous quarter.
Year to date (through Jul 29), the company repurchased 10.4 million shares worth $2.5 billion.
Unit Developments
At the end of the second quarter, Marriott's worldwide development pipeline totaled 3,509 hotels, with more than 559,000 rooms. As of the quarter's end, about 1,127 properties with more than 209,000 rooms were under construction.
Q3 & 2024 Outlook
For the third quarter, management anticipates gross fee revenues in the range of $1.28-$1.29 billion. Adjusted EBITDA is expected between $1.23 billion and $1.25 billion. MAR estimates third-quarter EPS to be between $2.27 and $2.33.
The company projects worldwide system-wide RevPAR to increase 3-4% year over year.
For 2024, Marriott reduced its gross fee revenue expectations to $5.13-$5.18 billion from the prior expected range of $5.18-$5.28 billion. General and administrative expenses are now projected in the range of $1.02-$1.03 billion (priorly expected between $1.02 billion and $1.04 billion).
Adjusted EBITDA is now expected between $4.95 billion and $5.2 billion compared with the previous expectation of $4.96-$5.1 billion. The company now envisions 2024 EPS in the band of $9.23-$9.40, down from the prior expectation of $9.31-$9.65.
Zacks Rank & Recent Consumer Discretionary Releases
Marriott currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boyd Gaming Corporation (BYD - Free Report) reported second-quarter 2024 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The company’s top line increased year over year.
Segment-wise, the Las Vegas Locals market showed improvement sequentially. Its business in this segment achieved market share growth. Additionally, the company experienced strong growth in its Downtown Las Vegas operations and maintained stable performance in Midwest and South operations.
Hasbro, Inc. (HAS - Free Report) reported second-quarter fiscal 2024 results, wherein earnings and revenues beat the Zacks Consensus Estimate. Despite a year-over-year revenue decline, earnings increased on the back of a favorable business mix and improved operations.
Net revenues from the Consumer Products and Entertainment segment decreased 20% year over year to $524.5 million and 90% year over year to $18.8 million, respectively. Nonetheless, Wizards of the Coast and Digital Gaming segment’s revenues totaled $452 million, up 20% from $375.6 million in the year-ago quarter. The upside was driven by a higher digital licensing revenue mix and lower royalty expenses.
Royal Caribbean Cruises Ltd. (RCL - Free Report) reported impressive second-quarter 2024 results, wherein earnings and revenues beat the Zacks Consensus Estimate. The bottom and top lines increased on a year-over-year basis. RCL benefited from stronger pricing on close-in demand and continued strength in onboard revenues.
RCL is focused on driving strong shareholder returns by delivering a lifetime of vacations and capturing a larger share of the rapidly growing $1.9 trillion global vacation market. It focuses on disciplined expansion, moderate yield growth and cost control to achieve the same. Furthermore, during the quarter, the company achieved its Trifecta financial goals (18 months ahead of schedule), strengthened its balance sheet and reinstated dividends, thereby enhancing shareholders’ value.