(Reuters) – Hotel operator Marriott International Inc (NASDAQ:MRX) lowered its 2024 room revenue growth forecast on Wednesday, citing a weaker operating environment in China and expectations of weaker demand in North America.
The company’s shares fell 4.7% before the bell.
Marriott expects its revenue per available room (RevPAR), an important metric in the hospitality industry, to grow 3% to 4% this year, lowering the high end of the range from 5%.
Hotels are not immune to the slowdown in consumption in China, wrote Richard Clark, an analyst at Bernstein.
Companies around the world have cut their full-year sales and profit forecasts as global consumer sentiment is hurt by a weak Chinese economy amid a prolonged slowdown in the property market.
Marriott’s quarterly revenue per available room fell 4.6% in China, compared to a 12% increase in other parts of Asia.
Meanwhile, domestic travel in the United States has remained weak since the start of the year, with more tourists choosing to travel internationally to destinations in Asia, Latin America and Europe.
The group’s RevPAR internationally increased by 6.4% during the quarter, led by a 16.8% increase in the Middle East and Africa.
Incentive management fees were $195 million, compared to $193 million in the same period last year.
Excluding items, Marriott reported quarterly earnings of $2.50 per share, beating Wall Street expectations of $2.47 per share, according to LSEG data.
Total revenue for the quarter ended June 30 was $6.44 billion, up about 6% from a year earlier.
