Marriott International Inc. (MAR), the largest U.S. hotel operator, on Thursday posted a jump in quarterly earnings and raised its profit forecast, saying the turnaround in travel was moving ahead faster than expected.

Marriott, which owns the Ritz-Carlton (search) and Courtyard brands along with its flagship name, said net profit rose 28 percent to $160 million, or 67 cents per share in the second quarter, from $125 million, or 51 cents per share, a year earlier.

Analysts, on average, expected 61 cents a shareness travelers as well as more vacationers returned to the roads and skies.

Room rates rose 3.7 percent in the second quarter, reflecting a recovery in an industry that lost its pricing power after the Sept. 11, 2001 attacks on the World Trade Center. The following slump in travel left hotels unable to raise room rates until this year, as they suffered the effects of the Iraq war and the spread of SARS (Severe Acute Respiratory Syndrome (search)).

"International travel is also coming back, and we're seeing the benefits," said Laura Paugh, Marriott spokeswoman. International arrivals at Marriott's U.S. hotels rose 34 percent from last year, Paugh said.

Total revenue rose to $2.4 billion from $2.02 billion a year earlier.

Still, Marriott shares were relatively unchanged, up 8 cents at $49.65 on the New York Stock Exchange (search).

The higher earnings forecast reflects a stronger second quarter and not an expectation of stronger demand trends in the second half of the year, Fulcrum Global Partners analyst Joe Greff, wrote in a research note.

Looking ahead, Marriott raised its forecast of full-year earnings from continuing operations to range between $2.32 to $2.40 per share, up from its earlier forecast of $2.24 to $2.34.

"Today, the economic recovery in the lodging industry is playing out faster than we expected," Chief Financial Officer Arne Sorenson said.

Marriott, which plans to open about 25,000 to 30,000 new rooms this year, said it expects third-quarter income from continuing operations to range between 52 cents and 56 cents a share, including 11 cents to 13 cents from its synthetic fuel operation.

The Bethesda, Maryland-based hotel operator said it expects strong group and transient demand, or mid-week travel, for the rest of the year. It forecast full-year revenue per room growth of 7 to 9 percent at its North American properties. "We expect about 50 percent of that to be driven by higher room rates,"

The company expects profit margins to "improve modestly" in 2004, driven by higher room rates. It forecast lodging operating income of $600 million to $615 million for the full year and $115 million to $125 million for the third quarter.