Sonder Reveals More Details on Marriott Partnership Deal
Sonder Holdings has released its delayed Q3 earnings report, revealing new details about its licensing agreement with Marriott International. As part of the deal, Marriott is paying Sonder $15 million, with $7.5 million already paid in November 2024 and the remaining balance due by March 31, 2025.
The 20-year agreement integrates Sonder’s inventory into Marriott’s booking channels, allowing customers to reserve Sonder units through Marriott. Both companies have the option to exit after five years by paying an undisclosed termination fee. Sonder will also pay Marriott a royalty fee under the agreement.
Sonder views the partnership as a key step in addressing financial challenges. However, its SEC filing acknowledged “substantial doubt” about its ability to remain operational over the next year due to continued losses and negative cash flow.
In 2024, Sonder reduced its portfolio by exiting 70 buildings with 2,800 units and plans to exit 10 more. As of Q3, Sonder had 10,100 live bookable units, a 14% decline from the previous year.
Despite downsizing, Sonder reported a 22% YoY increase in revenue per available room (RevPAR) to $176 and a 22% rise in average daily rate (ADR) to $207. Occupancy grew to 84.8%, though total occupied nights dropped nearly 10% due to reduced inventory.
Sonder’s Q3 revenue rose 1% YoY to $162.1 million, but its net loss widened to $179.4 million, partly due to stock-related losses. CEO Francis Davidson emphasized progress in improving revenue and cost efficiency despite ongoing challenges.
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