(Reuters) - Marriott International Inc MAR.O on Friday reported a surprise third-quarter profit, helped by cost cuts and a near doubling of occupancy rates in its North American hotels from the previous quarter as leisure travel rebounded on easing COVID-19 curbs.
While international travel continues to be affected because of border restrictions in many countries, travel within nations has picked up and resulted in a recovery in occupancy rates for hotel chains.
Marriott, which owns the JW Marriott and Ritz-Carlton brands, said 94% of its hotels around the world had resumed operations and demand continues to improve.
Occupancy rates in North America, its biggest market, rose to 37% in the third quarter ended Sept. 30, from 19.6% in the second quarter. Marriott said business and group travel was recovering more slowly.
Greater China was Marriott’s best-performing market in the reported quarter, as occupancy rates jumped to 61.4% from 35.5% in the second quarter.
Earlier this week, smaller rival Hilton Worldwide HLT.N also said it had seen a gradual improvement in demand from a pandemic-induced slump after cost cuts helped the company post a surprise quarterly profit. Marriott's total expenses fell 57.2% to about $2 billion in the reported quarter, while net profit dropped by 74% to $100 million, or 31 cents per share.
Excluding items, Marriott earned 6 cents per share, beating analysts’ expectation for a loss of 8 cents per share, according to IBES data from Refinitiv.
Revenue slumped 57.3% to $2.25 billion but topped Wall Street’s expectation of $2.23 billion.
Marriott’s shares were down about 1% at $99.85 along with the broader market, as investors awaited the U.S. presidential election result.
Reporting by Ashwini Raj and Ankit Ajmera in Bengaluru; Editing by Ramakrishnan M.
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