Marriott Posts Another Big Quarter, With $2.6 Billion In Share Buybacks In 2022

Marriott, the world’s largest hospitality company, posted on Tuesday a record fourth quarter in 2022, buoyed by strong worldwide travel demand and higher room rates.

Between October and December, the company’s net income totaled $673 million, a 44% increase above the year-ago quarter.

Not bad for a company that began as a nine-stool root-beer stand in 1927. Today the company’s portfolio spans nearly one and a half million rooms across more than two dozen hotel brands, including JW Marriott Hotels, Ritz-Carlton, St. Regis, W Hotels, Le Méridien, Westin, Sheraton and Courtyard by Marriott.

“Our performance in 2022 was terrific,” said Marriott CEO and president Anthony Capuano. “Just two years after experiencing the sharpest downturn in our company’s history, we reported record financial results.”

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In the fourth quarter of 2022, Marriott’s worldwide revenue per average room (RevPAR) grew 5% compared to the same period in pre-pandemic 2019, driven by a 13% increase in the average daily room rate (ADR). The key metrics of RevPAR and ADR exceeded 2019 levels everywhere except China, which only relaxed its Covid-related quarantine requirement for visitors in the last days of 2022.

In large part, Marriott’s success reflects the industry’s post-pandemic recovery. “Unlike previous downturns, room rates have been the key driver of recovery as each of the global regions, excluding Asia, showed an [average daily rate] increase over 2019,” said Robin Rossmann, managing director of STR, a firm that collects worldwide market data for the hotel industry. “Despite economic headwinds, the industry is operating from a position of strength in the new year.”

“Our fee-driven, asset-light business model generated significant cash during the year, allowing us to both invest in the growth of our business and return $2.9 billion to shareholders,” said Capuano, who noted that the company has a worldwide pipeline of more than 3,000 properties in development.

“Owners and franchisees continue to show a strong preference for our brands,” continued Capuano. Last year, the company’s development team signed nearly 108,000 rooms globally, with nearly 40% in high-value luxury and premium brands.

The strongest sign that the company is feeling flush is the $2.6 billion worth of stock that Marriott repurchased last year, including $1.4 billion just in the fourth quarter. The company returned $2.9 billion to shareholders in 2022.

Year to date through February 10, Marriott has already repurchased $400 million worth of shares.