REUTERS: Marriott International Inc on Thursday missed Wall Street estimates for quarterly revenue and forecast a lower-than-expected full-year profit, blaming weak demand in North America, 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.
The hotel operator's worldwide RevPAR growth of 1.3 percent in the fourth quarter missed analysts' expectations of 2.04 percent.
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 percent and 3 percent, from a previously announced range of 2 percent to 3 percent.
Marriott also incurred US$28 million of expenses in the quarter and recognized US$25 million of insurance proceeds related to 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.
The company also said North America's RevPAR to grow in the range of 1 percent to 2 percent in the current quarter, reflecting the impact of the government shutdown offset by a favorable calendar comparison.
Shares of the company, which owns the Ritz-Carlton and St. Regis luxury hotel brands, fell 2 percent to US$122.95 in after-hours trading.
The company expects full-year 2019 profit in the range of US$5.87 to US$6.10 per share, well below analysts' estimates of US$6.32, according to Refinitiv data.
On an adjusted basis, the company earned US$1.44 per share, beating estimates of US$1.39.
Net income rose to US$317 million, or 92 cents per share, in the fourth quarter ended Dec. 31, compared with US$114 million, or 31 cents per share, a year earlier.
Revenue rose to US$5.29 billion from US$5.25 billion. Analysts on average were expecting US$5.48 billion.
(Reporting by Sanjana Shivdas, Divya R and Manogna Maddipatla in Bengaluru; editing by Shinjini Ganguli and G Crosse)