Group business was "again the standout segment" during Marriott International's fourth quarter, with Marriott CEO Anthony Capuano telling analysts that group is also "shaping up to have another solid year in 2024" during the company's Q4 earnings call on Tuesday.
According to Capuano, group business comprised 23% of Marriott's total room nights for the fourth quarter, with group revenue up 9% globally and 7% in the U.S. and Canada year over year.
Additionally, at the end of 2023, Marriott's group revenue for full-year 2024 was pacing up nearly 13% globally and 11% in the U.S. and Canada.
Leeny Oberg, Marriott's CFO and executive vice president for development, said 75% of expected group business in 2024 is already on the books, up from 65% a year ago for expected 2023 group business.
While groups enjoyed the most dramatic fourth-quarter jump, leisure demand remained elevated, with fourth-quarter revenue nearly 50% above the same quarter in 2019.
Capuano also reported that business travel continues to improve. Small and medium-size businesses have led the pandemic rebound, but large corporations "continue to post volume increases," Capuano said.
Marriott said fourth-quarter business travel revenue increased 7% globally and 3% in the U.S. and Canada.
"The demand for all types of travel remains strong, even as the rebound impact from the pandemic has waned," Capuano said.
Big bounce-back in China
In terms of regional performance, Marriott's Asia-Pacific business experienced the largest year-over-year increase in revenue per available room (RevPAR), buoyed primarily by an 81% surge in China. For the fourth quarter, Asia-Pacific RevPAR was up 13%, compared with a 3% increase in the U.S. and Canada.
According to Capuano, Marriott's full-year outlook takes into account "a steady, albeit slower growing, global economy."
"It also reflects normalized lodging demand in most regions around the world, with Asia-Pacific expected to see higher growth in other regions as it continues to have some benefit from Covid recovery as well as additional international airlift," he added.
For the fourth quarter, Marriott reported systemwide RevPAR growth of 7.2%, to just over $121. Occupancy for the quarter increased 2.6 percentage points to 67%, while average daily rate (ADR) was up 3%, to roughly $180.
Marriott reported fourth-quarter net income of $848 million, up from $673 million in the fourth quarter of 2022. Revenue totaled approximately $6 billion, up from $5.9 billion in Q4 of 2022.