Marriott Still Working Through Starwood Integration Two Years After Deal
Photo Credit: Marriott International CEO Arne Sorenson, speaking at an internal Marriott conference. Marriott
Skift Take
Can Marriott hold onto hotel owners and SPG elites? That was the underlying question on many analysts' minds during Marriott's second quarter earnings call. After all, the bigger you are, the harder you have to fall, right? But the world's largest hotel company, not surprisingly, doesn't see things that way.
Two years after Marriott's $13.3 billion purchase of Starwood Hotels & Resorts, the work of integrating the acquisition is still proving to be a challenge, and still raising concerns among investors and analysts.
After seeing Marriott's second quarter results Monday night, investors and analysts were most concerned with net unit growth — the number of hotels being added to and subtracted from the Marriott portfolio — as well as with recent reports from various hotel owners and real estate investment trusts expressing some displeasure with Marriott-branded hotel performance.
Shares were off 4 percent on Tuesday.
In compiling its guidance for the year, Marriott reduced its outlook for net unit growth to 5 percent for the full year 2018, with gross room additions being 7 percent. Following the first quarter, Marriott had given an outlook within the range of 5.5 to 6 percent. That reduction — just 0.5 to 1 percent shy of previous estimates — raised some concerns.
