Marriott's Digital Penetration Hits 'Historic Highs' As Bonvoy App Downloads Soar Adding 31 Million New Members

While Marriott International Inc. MAR performed better than analysts’ expectations in the fourth quarter, its guidance missed the first-quarter estimates. However, the company highlighted its growing digital strength and loyalty program during its earnings call.

What Happened: The hotel giant announced a surge in digital engagement, including a near 30% year-over-year increase in Marriott Bonvoy app downloads in 2024. It added over 31 million new Bonvoy members over the last year, bringing the total to nearly 228 million.

“Bonvoy member penetration of room nights achieved historic highs in the fourth quarter at 73% in the U.S. and 66% globally,” said CEO Anthony Capuano.

Marriott Bonvoy is a free loyalty program where guests earn and redeem points for stays at Marriott hotels, including brands like Ritz-Carlton, St. Regis, JW Marriott, Sheraton, Westin, and Renaissance.

Capuano added, “Our digital channels and mobile in particular remain key drivers of direct bookings at a lower cost to our owners.

“We're excited about enhancing the customer experience across all of our digital channels through the multi-year digital transformation we have underway.” Capuano hinted that the company expects to roll out the transformation strategies “a little later this year.”

The company’s focus on digital extends beyond just its own platforms. Marriott has forged strategic partnerships in its “co-brand credit cards” with companies like Uber Technologies Inc. UBER and Starbucks Corp. SBUX, further integrating travel into consumers' daily lives, said the CEO.

Why It Matters: The company reported fourth-quarter sales growth of 5.5% year-on-year to $6.429 billion, beating the analyst consensus estimate of $6.379 billion. Adjusted EPS of $2.45 beat the consensus estimate of $2.38.

However, its first-quarter adjusted earnings are expected to range from $2.20 to $2.26 per share, whereas Benzinga Pro expects earnings of $2.360 per share.

The shares of the company fell 5.40% to $288 apiece on Tuesday after missing the first-quarter guidance expectations. The shares rose by 0.04% in after-hours.

Price Action: The stock was up 0.042% in premarket on Wednesday, whereas the exchange-traded fund tracking Nasdaq 100 index, Invesco QQQ Trust, Series 1 QQQ fell 0.11% in premarket.

MAR shares have gained 4.94% on a year-to-date basis, whereas it was up by only 5.74% over the last year.

The average price target among 28 analysts tracked by Benzinga is $260.74 with a ‘hold' rating. The estimates range from $185 to $330 apiece. Recent ratings from Wells Fargo, Evercore ISI Group, and Argus Research suggest a $315 target, implying a potential upside of 9.33%.