Marriott Posted a Bigger-than-Expected Quarterly Loss

The coronavirus pandemic continues to dominate the headlines for several months in a row. For example, to understand the impact of the pandemic, it makes sense to have a look at Marriott International. It is worth mentioning that Marriott International posted a bigger-than-expected quarterly loss on August 10.

The coronavirus pandemic had a dramatic impact on global travel. As a result, the U.S. hotel operator suffered losses. As of August 10, its shares fell 40.3% in 2020 as the company also reported an 84.4% plunge in revenue per available room (RevPAR). Importantly, RevPAR is a key performance measure for the hotel industry.

Marriott International and coronavirus pandemic

As mentioned above, the coronavirus pandemic continues to affect global travel. However, the U.S. hotel operator expects a gradual rise in the occupancy rate across the world. Nevertheless, it may take several years for them to return to pre-COVID period demand levels. Moreover, Marriott is not alone as Hilton also expects to reach better results.

According to Marriott International, it recorded a recovery across all regions. The global occupancy rates of 34% for the week ended on August 1 up from 11% in the week that ended April 11. Interestingly, In China, occupancy levels reached 60%.

It is worth noting that Marriott International reopened 91% of its worldwide hotels compared with 74% in April.

Unfortunately, on an adjusted basis, the U.S. hotel operator reported a loss of 64 cents per share in the second quarter. The second quarter ended on June 30. Interestingly, this result surpassed expectations. As a reminder, analysts expected a loss of 42 cents per share. Marriott International previously reported a quarterly net loss in 2011.

Notably, total revenue fell 72.4% to $1.46 billion.

The hospitality industry suffered huge losses due to the pandemic. It is hard to determine how long the pandemic will continue to affect the industry.