Published by Global Banking & Finance Review®
Posted on May 6, 2025
2 min readLast updated: January 24, 2026
Add as preferred source on GoogleMarriott lowers its 2025 revenue forecast due to U.S. government spending cuts affecting travel demand, though international markets show growth.
By Aishwarya Jain
(Reuters) -U.S. hotel operator Marriott International trimmed its full-year room revenue forecast on Tuesday, as tariff-induced uncertainties and federal spending cuts under President Donald Trump sap demand.
The company highlighted a hit from a 10% drop in nights booked by the U.S. government, as Trump's funding cuts trigger staff layoffs and tighter travel budgets.
In March, United Airlines said government-related travel bookings slumped 50%, as the sweeping spending cuts reverberate across sectors of the U.S. economy.
United Airlines also warned that the reduced government spending was having a ripple effect on the domestic leisure market.
Marriott's CFO Leeny Oberg echoed the comments during an earnings conference call, saying the company's lower-priced tiers in the U.S. showed some signs of weaker demand.
The company said visibility into the second half of the year was low due to a short booking window, which signaled increased consumer uncertainty and caution in spending on travel.
Marriott expects 2025 room revenue growth of 1.5% to 3.5%, compared with 2% to 4% it forecast earlier.
However, the 50 basis points cut was lower compared to the 150 basis points reduction by rival Hilton.
Marriott's shares were up 1.6% in morning trading after the company's first-quarter adjusted profit of $2.32 per share beat estimates of $2.25.
The company, which owns brands including Sheraton and Courtyard, expects second-quarter adjusted profit of $2.57 to $2.62 per share, below analysts' estimates of $2.68.
The Ritz-Carlton parent also said growth in revenue per available room (RevPAR) in the U.S. and Canada slowed in March, but was still up 3%.
Revenue rose 5% to $6.26 billion and beat estimates of $6.17 billion, according to data compiled by LSEG.
Marriott benefited from robust growth in its international markets, particularly in Asia-Pacific excluding China, where RevPAR jumped 10.9%, buoyed by strong demand in Southeast Asia from wealthy Chinese consumers.
(Reporting by Aishwarya Jain in Bengaluru; Editing by Sriraj Kalluvila)
The article discusses Marriott's adjusted revenue forecast due to U.S. government spending cuts impacting travel demand.
A 10% drop in U.S. government travel bookings has contributed to Marriott lowering its revenue forecast.
Marriott is experiencing robust growth in international markets, particularly in Asia-Pacific excluding China.
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