Core Viewpoint - Marriott International has reduced its full-year revenue growth and profit forecasts due to a slowdown in travel demand in the US, particularly affecting its lower-cost hotel segments [1][2][5]. Revenue and Profit Forecast - The company now expects 2025 revenue growth of 1.5% to 2.5%, down from a previous guidance of 1.5% to 3.5% [3]. - Profit guidance has been lowered to $9.82 to $10.08 per share, compared to the previous range of $9.85 to $10.08 [3]. Impact of Economic Factors - The slowdown is attributed to "heightened macro-economic uncertainty" and elevated inflation affecting budget-conscious travelers [4][3]. - A significant decline of 17% in bookings from government workers has also impacted lower-cost hotels [2]. Performance by Segment - Luxury hotel brands, including Ritz-Carlton and JW Marriott, experienced a 4.1% increase in room revenue in the US and Canada during the second quarter [7]. - The average room rate for luxury properties was reported at $417, while budget properties averaged $161 [7]. Overall Revenue Growth - Marriott's total revenue rose by 5% to $6.74 billion, driven by upscale properties and international business [8]. - The company did not comment on international tourism trends but noted a pullback in visitors from Canada and Mexico due to trade policy changes [8]. Legislative Impact - The signing of Trump's "One Big Beautiful Bill" is seen as a factor that reduced uncertainty in the industry, positively impacting consumer and franchisee confidence [10][11].

Core Insights - Marriott International is focusing on budget travelers who prioritize travel but seek more affordable options, as indicated by spending data from credit card relationships [1][5] - The company has significantly expanded into the mid-scale segment, which it historically did not operate in, starting with the acquisition of City Express for $100 million in 2022 [2][5] - Marriott has launched its first StudioRes in Fort Myers, Florida, targeting cost-conscious consumers with modest services and amenities [3] Financial Performance - In the first quarter, Marriott generated $6.26 billion in revenue and reported a net income of $665 million [4] Strategic Initiatives - The introduction of StudioRes aims to cater to various travel purposes, appealing to individuals on temporary assignments or digital nomads [3] - Marriott's diverse portfolio includes brands like Ritz-Carlton, St. Regis, Sheraton, Courtyard, Westin, and Moxy, allowing the company to offer suitable accommodations for different consumer needs [3]