Marriott International Inc. (MAR) shares took a hit on Monday after the hotel giant reported its second-quarter 2026 results. While the company managed to beat earnings estimates, investors were less thrilled about a revenue miss and softer-than-expected guidance for the current quarter.

Earnings Beat, Revenue Misses

Adjusted earnings came in at $3.19 per share, up from $2.65 a year ago and above the analyst consensus of $3.09. Revenue rose 5% year over year to $7.07 billion, but that fell short of the $7.20 billion analysts were looking for. On a reported basis, diluted EPS increased to $2.90 from $2.78.

Net income totaled $766 million, while adjusted net income jumped 16% to $844 million. Adjusted EBITDA climbed 13% to $1.59 billion.

Adjusted operating income rose 12% to $1.33 billion, with the adjusted operating margin expanding to 66% from 65% a year earlier. Reported operating income, however, slipped to $1.23 billion.

Gross fee revenue grew 13% to $1.58 billion. Franchise and base management fees increased 14% to $1.37 billion, while incentive management fees rose 6% to $212 million.

U.S. Growth Offsets Middle East Weakness

Worldwide revenue per available room (RevPAR) increased 3.4%, driven by 5% growth in the U.S. and Canada. But the international picture was less rosy: international RevPAR declined 0.5%, as the ongoing Middle East conflict weighed on results. RevPAR in Europe, the Middle East and Africa fell more than 5%, including a steep 43% drop in the Middle East itself. Meanwhile, Asia-Pacific excluding China posted more than 5% growth, and Greater China saw RevPAR rise more than 3%.

Pipeline Reaches Record Level

Marriott added about 17,900 net rooms during the quarter, with roughly 11,000 of those outside the U.S. and Canada. The company ended the quarter with more than 10,000 properties and nearly 1.814 million rooms worldwide.

Its development pipeline grew nearly 7% to a record 4,186 properties, representing about 629,000 rooms, including more than 279,000 rooms under construction. Conversions accounted for more than one-third of room signings and 40% of first-half openings.

Marriott Bonvoy membership exceeded 295 million. The company also signed new U.S. co-branded credit card agreements with JPMorgan Chase and American Express.

Quarterly results included a $27 million property-related litigation accrual and a $68 million impairment charge tied to the sale of a hotel in the U.S. and Canada region.

Marriott ended the quarter with $500 million in cash and cash equivalents and $16.9 billion in total debt.

Outlook

For the third quarter, Marriott forecast adjusted earnings of $2.74 to $2.82 per share, below the analyst consensus of $2.87.

The company raised its full-year adjusted EPS guidance to a range of $11.64 to $11.81, up from its prior outlook of $11.38 to $11.63. The updated range brackets the consensus estimate of $11.64.

Marriott also reaffirmed its expectation for full-year RevPAR growth of 3% to 3.5% and said net room growth is expected at the low end of its 4.5% to 5% target range.

MAR Price Action: Marriott International shares were down 7.25% at $345.80 at the time of publication on Monday, according to market data.