Marriott International Inc has missed Wall Street estimates for quarterly revenue and forecast a lower-than-expected full-year profit, blaming weak demand in North America, its its largest market.
Marriott's revPAR growth - a key measure of hotel health - during the fourth quarter was hurt by labor strikes in eight markets in North America and weaker-than-expected demand for the industry.
"Q4 profit beat, but RevPAR unimpressive. 2019 RevPAR guide lowered and earnings guide miss," SunTrust Robinson Humphrey analyst Patrick Scholes said in a note.
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The hotel operator's worldwide RevPAR growth of 1.3% in the fourth quarter missed analysts' expectations of 2.04%.
RevPAR is calculated by multiplying a hotel's average daily room rate by its occupancy rate.
The world's largest hotel chain lowered its full-year worldwide revPAR forecast between 1% and 3%, from a previously announced range of 2% to 3%.
Data Security Incident
Marriott also incurred $28 million of expenses in the quarter and recognized $25 million of insurance proceeds related to a data security incident it disclosed in November.
The company did not say, however, whether the data breach had any impact on demand.
Marriott said in January that fewer than 383 million customer records were stolen in a massive cyber attack and 25.55 million passport numbers were stolen in the attack on the Starwood Hotels reservation system.
Expectations And Statistics
The company also said it expects North America's RevPAR to grow in the range of 1% to 2% in the current quarter, reflecting the impact of the government shutdown offset by a favorable calendar comparison.
The company expects full-year 2019 profit in the range of $5.87 to $6.10 per share, well below analysts' estimates of $6.32, according to Refinitiv data.
On an adjusted basis, the company earned $1.44 per share, beating estimates of $1.39.
Net income rose to $317 million, or 92 cents per share, in the fourth quarter, which ended on December 31, 2018, compared with $114 million, or 31 cents per share, a year earlier.
Revenue rose to $5.29 billion from $5.25 billion. Analysts on average were expecting $5.48 billion.