Key facts
- Marriott's Middle East RevPAR fell 12% in July, an improvement from a 43% drop in Q2.
- Ongoing regional conflicts are causing project delays due to supply chain and capital flow issues.
- Marriott forecasts net unit growth toward the lower end of its full-year targets.
- Global room revenue increased 7% in July, led by an 8% gain in the U.S. and Canada.
- CEO Anthony Capuano dismissed the idea that current travel strength is solely a post-pandemic 'revenge travel' spike.
Marriott International's revenue per available room (RevPAR) in the Middle East saw a significant narrowing of its decline in July, falling 12% year-over-year, according to CEO Anthony Capuano. This marks a substantial improvement from the 43% plunge recorded in the second quarter, despite persistent regional conflicts that continue to impact development projects.
Capuano stated that while the Middle East accounts for approximately 3% of Marriott's global fees, it represents a more significant 6% of its development pipeline. Supply chain bottlenecks and capital flow interruptions stemming from the conflict have triggered project delays, leading Marriott to forecast net unit growth toward the lower end of its full-year targets.
Despite these challenges, Capuano highlighted that a strong travel demand environment, sustained by a consumer preference for experiences over goods, is helping to offset some of the negative impacts. He dismissed the notion that the current travel strength is merely a fleeting post-pandemic "revenge travel" spike, pointing to broad-based momentum across demographics and brands.
Globally, Marriott reported a 7% increase in room revenue in July, with the U.S. and Canada region experiencing an 8% gain. RevPAR grew across luxury, premium, select, and mid-scale brands.
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