More consumers are traveling now than in the early months of the pandemic, which fueled a surprise quarterly profit for the largest hotel company in the world.
Marriott International, whose 7,600 properties worldwide have more than 1.4 million rooms, posted a profit of $100 million, or 31 cents a share, for the three months ended Sept. 30.
That’s down from this time last year when the chain posted a profit of $387 million, or $1.16 a share, a year earlier — but a marked improvement over the second quarter when the hotel giant reported a $234 million loss due to worldwide coronavirus lockdowns.
The upbeat results sent the stock up 2.95 percent to close at $103.89.
“While COVID-19 is still significantly impacting our business, our results for the third quarter showed continued improvement in demand trends around the world,” Marriott chief executive Arne Sorenson said in a statement.
Marriott’s uptick was largely due to leisure travelers who are staying in hotels within driving distance of their homes and that business travel remains depressed, the company said.
The Bethesda, Md.-based company, like many of its competitors, has promoted staycation packages across the country and even offered its rooms to office workers — with no overnight stay required — who needed a reprieve from working at home.
It’s properties in China experienced the biggest improvement, with occupancy rates there reaching 61 percent in the quarter. Nevertheless, Marriott’s 37 percent occupancy rate in North America was nearly double what it was in the previous quarter, the company said.
“We still have a long road ahead,” Sorenson added. “But this crisis will come to an end, and I believe travel will rebound quickly.”
Despite the upbeat quarter, Marriott laid off 17 percent of its headquarters workforce, or 677 employees, in October. Other major hotel chains have also downsized during the pandemic with Hyatt laying off 1,300 employees in May and Hilton slashing 2,100 corporate staffers in June.
In August, MGM Resorts announced plans to lay off 18,000 staffers across its gaming resorts.
“The steep occupancy declines are easing,” STR’s senior vice president, Jan Freitag told The Post. “But it’s too early to tell whether the recent Covid spikes are having an impact.”
“The bright spot of the third quarter was the continued demand by the leisure traveler which even spilled over past Labor Day,” Freitag said.
And while hotel bookings are picking up, they remain sluggish in many big US cities, including New York, Boston and the Chicago area, said Geoffrey Mills, president of GAM Hospitality Advisors.
The occupancy rate for the top 25 markets in the US was 41 percent for the week of Oct. 25 to Oct. 31, compared with 70 percent a year ago, according to STR, a hotel data research firm.
But within that group there are wide variations, with Boston’s occupancy rate for the same period at 34 percent and New Orleans’ at 53 percent. In the middle is New York at 39 percent.
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