Latest quarter
Marriott reported Q2 FY2026 revenue of $7.1 billion, up 4.85% from $6.7 billion a year earlier, while the consensus had called for $7.3 billion. The company reported adjusted EPS, as the consensus counts it, of $3.19, above the $3.06 consensus estimate; reported diluted EPS was $2.90, up 4.32% from $2.78 in Q2 FY2025.
The filing said worldwide RevPAR increased 3.4%, led primarily by 3.5% ADR growth. Marriott said U.S. & Canada RevPAR rose 5.0% on demand across brand tiers and customer segments, while International RevPAR declined 0.5% as the Middle East conflict affected travel. The filing attributed higher franchise fees to co-branded credit-card fees, rooms growth and RevPAR, while incentive management fees increased on higher profits at managed U.S. & Canada hotels.
Marriott reported gross margin of 22.0%, versus 22.3% a year earlier, and operating margin of 17.4%, versus 18.3%. The company reported free cash flow of $887.0 million, compared with $488.0 million a year earlier.
| Q2 FY2026 | Q2 FY2025 | Change | |
|---|---|---|---|
| Revenue | $7.1 billion | $6.7 billion | 4.85% |
| Diluted EPS | $2.90 | $2.78 | 4.32% |
| Gross margin | 22.0% | 22.3% | −0.4 percentage points |
| Operating margin | 17.4% | 18.3% | −0.9 percentage points |
| Free cash flow | $887.0 million | $488.0 million | 81.8% |
| Against the consensus | Reported | Consensus | Result |
|---|---|---|---|
| Adjusted EPS | $3.19 | $3.06 | Beat by 4.25% |
| Revenue | $7.1 billion | $7.3 billion | Missed by 2.60% |
Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.
What management said on the call
Tony Capuano said Q2 global RevPAR rose 3.4%, with U.S. and Canada RevPAR up 5% and international RevPAR slightly lower year over year. He said U.S. and Canada demand was supported by World Cup and non-World Cup markets, while the Middle East conflict weighed on international results. Capuano said Europe, APEC, Greater China and the Caribbean benefited from leisure and, in some markets, intra-regional or inbound demand.
On pricing, Capuano said ADR growth contributed to global RevPAR, and he said non-government business transient RevPAR in the U.S. and Canada rose as mid-single-digit ADR increases offset slight declines in room nights. Mason said Marriott expects demand trends across customer segments to continue in the U.S. and Canada during Q3, while the company expects the Middle East to remain an EMEA drag.
Capuano said the company added 4.5% net rooms over the 12 months ended June 30 and had approximately 629,000 rooms in its pipeline. He said the full-year net-rooms outcome was more likely to be toward the low end of the previous 4.5% to 5% range because of Middle East construction delays. When asked about owner sentiment, Capuano said the company signed more deals in the first half of 2026 than in any prior first half.
Mason said Marriott expects 2026 investment spending of $1.25 billion to $1.35 billion, including contract acquisition costs, technology transformation, corporate systems and hotel renovations. When asked about future spending, she said it was too early to discuss 2027 investment spending, while saying technology investment would continue.
Asked about competition for development deals, Capuano said key money is used more often in luxury and full-service development and in some newer midscale brands. He said Marriott was using less key money per signed deal than in 2019, while characterizing that observation as anecdotal. Mason said Q4 RevPAR could be lower than Q3 because U.S. and Canada would not receive a World Cup benefit and because the Middle East has greater fourth-quarter revenue exposure.
Guidance
Mason raised Marriott’s FY2026 worldwide RevPAR growth outlook to 3.00%–3.50% from 2% to 3%. Marriott’s FY2026 adjusted diluted EPS outlook became $11.64–$11.81 from $11.38–$11.63, while its adjusted EBITDA outlook became $6.0 billion–$6.0 billion from $5.9 billion–$6.0 billion. The company raised expected residential branding-fee growth to 55.0%–65.0% from 45.0%–50.0%, and Mason raised expected investment spending to $1.25 billion to $1.35 billion from $1.1 billion–$1.2 billion.
| Metric | For | Guide | Previous guide | Change |
|---|---|---|---|---|
| Tax rate, non-GAAP | FY2026 | 26.0%–26.5% | — | New |
| Tax rate, non-GAAP | Q3 FY2026 | 26.7% | — | New |
| EPS, non-GAAP | FY2026 | $11.64–$11.81 | — | New |
| EPS, non-GAAP | Q3 FY2026 | $2.74–$2.82 | — | New |
| Units growth, Net Rooms Growth | FY2026 | 4.50% | 4.50%–5.00% | Cut |
| Revenue growth, Worldwide Revpar | FY2026 | 3.00%–3.50% | — | New |
| Revenue growth, Worldwide Revpar | Q3 FY2026 | 3.50%–4.00% | — | New |
| Revenue, Co Branded Credit Cards | H2 FY2026 | $30.0 million | — | New |
| Tax rate, Adjusted Effective | FY2026 | 26.0%–26.5% | 26.0%–26.5% | Held |
| EBITDA, Adjusted | FY2026 | $6.0 billion–$6.0 billion | $5.9 billion–$6.0 billion | Raised |
| Operating expenses growth, General and Administrative | FY2026 | 1.00%–3.00% | 1.00%–3.00% | Held |
| Revenue growth, Residential Branding | FY2026 | 55.0%–65.0% | — | New |
| Revenue, Growth Fee | FY2026 | $6.0 billion–$6.1 billion | — | New |
| Units growth, Global | FY2026 | 4.50%–5.00% | — | New |
| Revenue growth, Residential Branding Fees | FY2026 | 45.0%–50.0% | — | New |
| Revenue growth, Co Branded Credit Card Fees | FY2026 | 35.0% | — | New |
| Revenue, Timeshare Fees | FY2026 | $110.0 million–$115.0 million | — | New |
| Revenue, Owned Leased and Other Net | FY2026 | $215.0 million–$225.0 million | — | New |
| Capex, Investment Spending | FY2026 | $1.1 billion–$1.2 billion | — | New |
| EPS, Adjusted Diluted | FY2026 | $11.38–$11.63 | — | — |
| Revenue, Gross Fee Revenue | FY2026 | $5.9 billion–$6.0 billion | — | New |