Global hospitality company Marriott (NASDAQ: MAR) reported revenue ahead of Wall Streets expectations in Q3 CY2025, with sales up 3.7% year on year to $6.49 billion. Its non-GAAP profit of $2.47 per share was 3.5% above analysts’ consensus estimates.
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Marriott (MAR) Q3 CY2025 Highlights:
- Revenue: $6.49 billion vs analyst estimates of $6.43 billion (3.7% year-on-year growth, 0.9% beat)
- Adjusted EPS: $2.47 vs analyst estimates of $2.39 (3.5% beat)
- Adjusted EBITDA: $1.35 billion vs analyst estimates of $1.31 billion (20.8% margin, 3.2% beat)
- Management slightly raised its full-year Adjusted EPS guidance to $10.02 at the midpoint
- EBITDA guidance for the full year is $5.37 billion at the midpoint, in line with analyst expectations
- Operating Margin: 18.2%, up from 15.1% in the same quarter last year
- RevPAR: $129.13 at quarter end, down 2% year on year
- Market Capitalization: $71.64 billion
Company Overview
Founded by J. Willard Marriott in 1927, Marriott International (NASDAQ: MAR) is a global hospitality company with a portfolio of over 7,000 properties and 30 brands, spanning 130+ countries and territories.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, Marriott grew its sales at a 13.5% annual rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the consumer discretionary sector, which enjoys a number of secular tailwinds.
We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new property or trend. Marriott’s recent performance shows its demand has slowed as its annualized revenue growth of 4.9% over the last two years was below its five-year trend. 
Marriott also reports revenue per available room, which clocked in at $129.13 this quarter and is a key metric accounting for daily rates and occupancy levels. Over the last two years, Marriott’s revenue per room averaged 2% year-on-year growth. Because this number is lower than its revenue growth, we can see its sales from other areas like restaurants, bars, and amenities outperformed its room bookings. 
This quarter, Marriott reported modest year-on-year revenue growth of 3.7% but beat Wall Street’s estimates by 0.9%.
Looking ahead, sell-side analysts expect revenue to grow 5.3% over the next 12 months, similar to its two-year rate. This projection is underwhelming and suggests its newer products and services will not lead to better top-line performance yet.
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Operating Margin
Marriott’s operating margin might fluctuated slightly over the last 12 months but has generally stayed the same, averaging 15.5% over the last two years. This profitability was solid for a consumer discretionary business and shows it’s an efficient company that manages its expenses well.
This quarter, Marriott generated an operating margin profit margin of 18.2%, up 3.1 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Marriott’s EPS grew at an astounding 51.2% compounded annual growth rate over the last five years, higher than its 13.5% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
In Q3, Marriott reported adjusted EPS of $2.47, up from $2.26 in the same quarter last year. This print beat analysts’ estimates by 3.5%. Over the next 12 months, Wall Street expects Marriott’s full-year EPS of $9.89 to grow 10.5%.
Key Takeaways from Marriott’s Q3 Results
It was encouraging to see Marriott beat analysts’ EPS expectations this quarter. Full-year EPS guidance was also raised slightly. On the other hand, EBITDA guidance was only in line. Zooming out, we think this was a decent quarter. The stock remained flat at $263.80 immediately following the results.
So should you invest in Marriott right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.
