Marriott (MAR) Raises 2026 RevPAR Outlook on US Demand

Marriott shares rose about 3% premarket after the hotel group lifted its 2026 RevPAR growth forecast to 4.5%-5%, citing strong US demand and a Q3 earnings beat.

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What Did Marriott Report for the Third Quarter?

Marriott reported worldwide RevPAR growth of 6.5% for the third quarter, led by the United States and Canada. Net income rose 9% to $794 million, and reported diluted EPS was $3.04. Adjusted EBITDA reached $1,512 million, up 12% from a year earlier.

Fee income, the core of Marriott's asset-light model, grew faster than the top line. Gross fee revenues rose 14% to $1,522 million. Franchise fees climbed 15% to $1,007 million, and incentive management fees, which depend on property profitability, rose 22% to $181 million.

Regional performance:

• U.S. and Canada: RevPAR up 7.4%, with the upscale and luxury tier rising 11.9%.
• International: RevPAR up 4.4%, with Asia Pacific excluding China growing more than 9%.

Why Did Marriott Raise Its 2026 RevPAR Forecast?

Marriott raised the forecast because third-quarter results beat its own plan and the fourth-quarter outlook strengthened. The company now expects full-year worldwide RevPAR growth of 4.5%-5%, compared with its earlier range of 3%-3.5%. It guides to the same 4.5%-5% range for the fourth quarter.

The increase is large for a mature hotel business, where RevPAR growth typically moves in narrow bands. It points to pricing power in the US, where leisure and business travel have both held up and high-end properties have outperformed.

How Does the New Guidance Affect Earnings Expectations?

Higher RevPAR flows through to fees at a high margin, so the earnings outlook rose with it. For 2026, Marriott guides to:

• Adjusted EBITDA of $6,075 million to $6,098 million, roughly 13% growth.
• Adjusted diluted EPS of $12.07 to $12.14, growth of 20%-21%.
• Gross fee revenues of $6,137 million to $6,145 million.
• Net rooms growth at the low end of a 4.5%-5% range.

For the fourth quarter, the company expects adjusted EBITDA of $1,573 million to $1,596 million and adjusted EPS of $3.14 to $3.21. Part of the EPS gain comes from a shrinking share count, which amplifies the effect of EBITDA growth on per-share earnings.

Strategic Context: Fees, Pipeline and Capital Returns

Marriott owns few of its hotels. It earns franchise and management fees, which makes results sensitive to RevPAR and to the pace of new rooms. The company added about 20,100 net rooms in the quarter, lifting net rooms growth to 4.6% year over year. Its development pipeline stands at 4,209 properties with more than 634,000 rooms, of which 1,750 properties and over 278,000 rooms are under construction.

Capital returns remain a pillar of the equity story. Marriott repurchased 3.5 million shares for $1.3 billion in the third quarter and has returned about $4.0 billion to shareholders through October 28. It expects to return at least $4.8 billion for the full year, with investment spending of $1.25 billion to $1.35 billion.

What Comes Next for Marriott and Hotel Demand?

The next test is whether US demand can sustain high-single-digit RevPAR growth into 2027. Management has pointed to a 2027 global RevPAR growth range of 3.5%-4.5%, which implies a gradual normalization from this year's pace. The upscale and luxury tiers, which drove the third-quarter strength, are the segments most exposed to a slowdown in higher-income spending.

Two variables matter in the near term. One is fourth-quarter booking pace, which underpins the guidance. The other is international recovery, where growth of 4.4% trails the US and where China remains a drag relative to the rest of Asia Pacific.

Outlook

Marriott enters the final quarter of 2026 with stronger guidance, a record development pipeline and a heavy buyback program. RevPAR growth of 4.5%-5% for the year, backed by a 7.4% gain in the US and Canada, supports fee growth and earnings expansion. The premarket gain of about 3% reflects a quarter that beat on earnings, revenue and outlook at once.