Marriott International

Good day, everyone, and welcome to today's Marriott International Q2 2024 earnings. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing the star and 1 on your telephone keypad. You may withdraw yourself from the queue by pressing star and 2. Please note, this call is being recorded. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Senior Vice President, Investor Relations, Jackie McConaughey. Thank you.

Good morning, and welcome to Mary's second quarter 2024 earnings call. On the call with me today are Tony Capuano, our President and Chief Executive Officer, Leni Oberg, our Chief Financial Officer and Executive Vice President, Development, and Betsy Dahm, our Vice President of Investor Relations. Before we begin, I would like to remind everyone that many of our comments today are not historical facts and are considered forward-looking statements under federal securities laws. These statements are subject to numerous risks and uncertainties as described in our SEC filings, which could cause future results to differ materially from those expressed in or implied by our comments. Unless otherwise stated, our REVPAR occupancy average daily rate and property level revenues comments reflect system-wide constant currency results for comparable hotels, and all changes refer to year-over-year changes for the comparable period. Statements in our comments and the press release we issued earlier today are effective only today and will not be updated if actual events unfold. You can find our earnings release and reconciliations of all non-GAAP financial measures referred to in our remarks today on our Investors Relations website. And now I will turn the call over to Tony.

Thanks, Jackie, and good morning, everyone. We delivered another strong quarter as travel demand remained robust in most markets around the world, and our net rooms grew by 6% year-over-year. Second quarter global red bar rose nearly 5%. Average daily rate increased around 3%, and occupancy reached 73%, up about 150 basis points compared to last year's second quarter. Revpar rose nearly 4% in the U.S. and Canada, benefiting from the shift of the Easter holiday. All chain scales in the U.S. and Canada, from select service to luxury, posted positive second quarter year-over-year Revpar. Revpar increased over 7% internationally, led by a remarkable 13% Revpar gain in Asia-Pacific excluding China, or APEC. APEC benefited from strong macro trends and increased cross-border travel, especially from mainland China. Growth in APEC was broad-based, but particularly robust in Japan, where REVPAR rose 21%. REVPAR grew nearly 10% in the EMEA region, with continued strong regional and cross-border demand, and about 9% in the CALA region. To date in 2024, The City Express portfolio has meaningfully outperformed the overall Mexican market, as well as our own internal REVPAR expectations, and bond void penetration at the hotels continues to improve steadily. REVPAR in Greater China declined roughly 4% in the quarter, as macroeconomic pressures led to softer domestic demand. The region was also impacted by an increase in outbound high-end travel. Positive RevPAR growth in Tier 1 cities, Hong Kong, Macau, and Taiwan was more than offset by declines in all other markets, with Hainan seeing a meaningful RevPAR decline. Despite the adverse market conditions, we outperformed our peers and gained RevPAR index across the region in the second quarter. Our global RevPAR index, which is at a substantial premium, also rose again in the As we look ahead to the full year, we are narrowing our global REVPAR range to 3% to 4% growth, largely due to anticipated continued weakness in greater China, as Lini will discuss in more detail. On a global basis, in the second quarter, we saw REVPAR growth across all three of our customer segments, group, leisure transient, and business transient, with each segment experiencing increases in both room nights and average daily rate. Group, which comprised 24% of worldwide room nights in the quarter, remained the strongest customer segment. Compared to the year-ago quarter, group rent par rose 10% globally. Full-year 2024 worldwide group revenues were still pacing up 9% year-over-year at the end of the second quarter, with a 5% increase in room nights and a 4% rise in ADR. Business Transient, which contributed 33% of global room nights in the quarter, saw a 4% increase in RevPAR. Leisure Transient, which accounted for 43% of worldwide room nights in the quarter, posted a 2% rise in RevPAR. Within the Business Transient segment, demand from small to medium-sized corporates, which now account for nearly 55% of Business Transient room nights, has grown significantly over the last few years. Earlier this month, we announced Business Access by Marriott Bonvoy, a new comprehensive online booking travel program that we launched to ease and expand the booking experience and travel management process for these customers. While it is still early days, this new offering is already seeing great interest, and we're extremely pleased with the initial account sign-ups and users of the platform, both of which have outpaced expectations. We continue to enhance our powerful Marriott Bonvoy loyalty program, which had over 210 million members at the end of June. We continue to see real success driving enrollments and engagement internationally, in part due to our Bonvoy partnerships with Rakuten in Japan, Alibaba in China, and Rappi in Cali. Member penetration of global room nights rose again, reaching new record highs in the second quarter. at 71% in the U.S. and Canada, and 65% globally. Our new collaboration with Starbucks is the latest example of how we're connecting our members with people, places, and passions that they truly love. We also remain laser-focused on providing our guests with excellent experiences in our hotels and are pleased with our intent to recommend sports, which have continued to steadily rise. Our leading global portfolio continues to grow meaningfully faster than overall industry supply, and we added approximately 15,500 net rooms to end the quarter with nearly 1.66 million rooms. Global signing activity has remained strong. Record signings in APEC and Greater China for the first half of the year helped grow our pipeline to over 559,000 rooms around the world. Conversions, including multi-unit opportunities, remain a significant driver of growth as owners continue to value the depth and breadth of our brand portfolio and our powerful revenue engines. In the second quarter, conversions represented 37% of openings and 32% of signings. This conversion activity has been broad-based, with hotels converting into 23 different Marriott brands over the last 12 months. While still below 2019 levels, we're also pleased with the continued upward trend in monthly construction starts. In the second quarter, construction starts in the U.S. and Canada rose 40% year over year. In June, we signed three marquee luxury conversion deals in the U.S. The renowned resort at Pelican Hill in Newport Beach, California, and the luxury collection hotel Manhattan Midtown have already joined our system. The iconic Turtle Bay Resort in Hawaii is joining the Ritz-Carlton brand today. We are thrilled to welcome these incredible properties as we further extend our global leading position in the high-value luxury segment. Our momentum in the mid-scale space is excellent. Developers are showing significant interest in our new brands in the tier. City Express by Marion, Four Points Express by Sheraton, Studio Rez, and our latest transient conversion-friendly brand in the U.S. In Calum, we continue to sign deals for City Express and are engaged in numerous discussions across the region. Our first Four Points Express opened in Turkey, and over a dozen hotels from our recent multi-unit conversion deal in APEC are expected to join our system later this year. We're also in talks for Studio Res hotels in over 300 markets, and we continue to execute on and pursue numerous types of opportunities, from large development deals to one-off projects. Before I turn the call over to Leni to discuss our financial results, I want to say thank you to all of our associates around the world for the hard work they do each and every day to advance our business and help connect people through the power of travel. Leni?