2Q26 1st Take: Beat/raise with new Co-brand deal, #s expect upward ‘26 revisions, but mixed read for ‘27

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2Q26 1st Take: Beat/raise with new Co-brand deal, #s expect upward ‘26 revisions, but mixed read for ‘27

UpdateMpipeline growth (+7% yoy), drivers of softer O&L (litigation one-time vs. indicative of

other pressure), and the contribution of the co-brand credit card (typical flow-

through of RevPAR combined with the reduction in owned & leased could point to a

$30mn+ contribution in 2H with run-rate >$65mn and growing – we believe buyside

was likely closer to $100mn over time).

Questions for the call:

• Co-brand contribution: What is the contribution from co-brand to the guide

and longer-term? How did management balance their fee benefit vs. added

value to consumers or the system fund / owners?

• Net unit growth: With the pipeline now outpacing room growth, how should

investors think about the lowered room growth guide for the year vs. future

growth potential in 2027 and beyond?

• 2027 RevPAR puts/takes: What are management's initial thoughts on

drivers of RevPAR next year considering World Cup comparisons, potential

pent up demand in segments, lapping ME headwinds, etc.?

• High Investment Spend: What is driving the increase in investment spend

this year? How much key money is backing the current pipeline that will be

recognized in the future?

What happened: MAR's 2Q26 EBITDA was $1,592mn (+13% y/y), above guidance

($1,525-1,550m) and above MSe/Cons $1,545mn/$1,551mn. Relative to our estimates,

higher net fees, particularly in franchise fees and incentive fees, contributed to the

better results. Management provided updated 2026 EBITDA guidance with the

midpoint bracketing consensus. Details:

• Systemwide RevPAR was +3.4% yoy (vs. MSe/cons +2.1%/+2.6%). +5.0% in

US/Canada and -0.5% international.

• Net room growth came in at +4.5%, below MSe +5.1% and cons +4.7%.