Marriott International (MAR) 10-K risk factor changes: FY2022 vs FY2021

[removed: COVID-19 has dramatically reduced travel and demand for hotel rooms,] [added: These conditions] and [removed: has negatively impacted,] [added: events have] in [removed: some cases is continuing to] [added: the past materially] negatively [removed: impact] [added: impacted,] and [removed: may] [added: could] in the future [added: materially] negatively impact, our business, operations, and financial [removed: results,] [added: results in many ways,] including, but not limited to, as follows:

- reducing revenues at our managed and franchised hotels, owned and leased hotels, and properties in which we have an [removed: investment;][added: investment, potentially impacting their ability to meet expenses, including payment of amounts owed to us;]

- causing [removed: a significant number of] hotels to exit our system;

[removed: COVID-19, and the volatile regional and global economic] [added: The] conditions [removed: stemming from COVID-19, as well as additional or unforeseen effects from the COVID-19 pandemic or future pandemics,] [added: and events discussed in this risk factor] could also give rise to, aggravate, and impact our ability to allocate resources to mitigate the other risks that we identify below, which in turn could materially adversely affect our business, liquidity, financial condition, and results of operations.

[removed: Each of our] [added: Our] hotel brands and [removed: our home rental offering competes] [added: other lodging offerings generally compete] with major hotel chains, regional hotel chains, independent hotels, and home sharing and rental services across national and international venues.

Our ability to remain competitive and attract and retain [removed: business] [added: business, group] and leisure travelers depends on our success in distinguishing [removed: the quality] and [removed: value of, and] driving preference [removed: for,] [added: for] our lodging products and services, including our Loyalty Program, direct booking channels, consumer-facing technology platforms and services, and other offerings (including our co-branded credit [removed: cards), from those offered by others.][added: cards).]

Economic downturns and other global, national, and regional conditions [added: and events] could further impact our [added: business,] financial results and growth.

Because we conduct our business on a global [removed: platform,] [added: scale, we are affected by] changes in global, national, or regional economies, governmental policies (including in areas such as trade, travel, immigration, healthcare, and related issues), and [removed: geopolitical and] [added: geopolitical, public health,] social [added: and other] conditions [removed: impact our activities.][added: and events.]

Our [removed: business is] [added: business, financial results and growth are] impacted by [removed: decreases in travel resulting from] weak [added: or volatile] economic conditions, [added: pandemics and other outbreaks of disease, natural and man-made disasters,] changes in energy prices and currency values, [removed: technologies that provide alternatives to in-person meetings and events,] political instability, geopolitical conflict, [added: actual or threatened war, terrorist activity and other acts of violence,] heightened travel security measures, travel advisories, disruptions in air travel, and concerns over [removed: disease, violence, war, or terrorism.][added: the foregoing.]

Our hotel management and franchise agreements may be subject to premature termination in certain circumstances, such as the bankruptcy of a hotel owner or franchisee, the failure of [removed: the] [added: a] hotel owner or franchisee to comply with its payment or other obligations under the agreement, a failure under some agreements to meet specified financial or performance criteria which we do not cure, or in certain limited cases, other negotiated contractual termination rights.

[removed: The nature of our responsibilities under our management agreements] [added: This has from time] to [removed: manage each] [added: time given rise to disagreements with] hotel [added: owners] and [removed: enforce the standards required for our brands under both management] [added: franchisees,] and [removed: franchise agreements] may [removed: be subject to interpretation and will, from time to time,] give rise to [removed: disagreements, which may include] [added: such] disagreements [added: in the future, including] over the need for or payment for new product, [removed: service] [added: service,] or systems initiatives, the timing and amount of capital investments, and reimbursement for operating costs, system costs, or other amounts.

[removed: In the months following the onset of] [added: We have seen, and may in] the [removed: COVID-19 pandemic, we saw] [added: future see,] an increase in such [removed: disagreements, and an increase in] disagreements [removed: may become more likely again in the future] [added: with hotel owners and franchisees] during [removed: other] periods when hotel returns are weaker.

[removed: If any such dispute resolution process results in an adverse outcome, we] [added: We] could suffer significant losses, [removed: our profits could be reduced,] [added: reduced profits,] or [removed: our future ability to operate] [added: constraints on] our [removed: business could be constrained.][added: operations as the result of adverse dispute resolution outcomes.]

Some of our hotel rooms are booked through Internet travel intermediaries such as Expedia.com, Priceline.com, [added: Booking.com, Travelocity.com, and Orbitz.com, as well as lesser-known online travel service providers.]

[removed: In addition,] [added: At the same time,] if we are not able to negotiate new agreements on satisfactory terms when our existing contracts with intermediaries (which generally have [removed: 2-] [added: two-] to [removed: 3-] [added: three-] year terms) come up for renewal, our business and prospects could be negatively impacted in a number of [removed: ways.][added: ways, including by reducing bookings or making our brands less attractive to hotel owners.]

[removed: Our growth strategy for adding lodging facilities] [added: Adding properties to our system] entails entering into and maintaining various arrangements with property owners.

The terms of our management agreements and franchise agreements for each of our [removed: lodging facilities] [added: properties] are influenced by contract terms offered by our competitors, among other things.

[removed: Our] [added: The effects of, or our] failure to comply [removed: with] [added: with,] applicable [removed: laws and] [added: laws,] regulations [added: and government policies] may [added: disrupt our business, lower our revenues,] increase our costs, reduce our profits, [removed: or] limit our [removed: growth.] [added: growth, or damage our reputation.] We and the hotels that we franchise or manage are subject to a variety of [removed: laws and] [added: laws,] regulations [added: and government policies] around the globe, including, among others, [removed: laws] [added: those] related to employment practices; marketing and advertising efforts; trade and economic sanctions; anti-bribery and anti-corruption; [added: intellectual property;] cybersecurity, data privacy, data [removed: localization] [added: localization,] and the handling of personally identifiable information; competition; [added: climate and] the environment; health and safety; liquor sales; and the offer and sale of franchises.

The compliance programs, internal controls, and policies we maintain and enforce [added: may need] to [removed: promote compliance] [added: be updated regularly to keep pace] with [removed: laws and] [added: changing laws,] regulations [added: and government policies and] may not prevent our associates, contractors, or agents from materially violating [removed: these laws] [added: applicable laws, regulations] and [removed: regulations.][added: government policies.]

The [removed: failure to meet the] requirements of applicable [removed: laws or] [added: laws,] regulations, [removed: or] [added: and government policies, our failure to meet such requirements (including investigations and] publicity resulting from actual or alleged [removed: failures,] [added: failures), or actions we take in order to comply with such requirements or investigations] could have [removed: a] significant adverse [removed: effect] [added: effects] on our results of [removed: operations] [added: operations, reputation,] or [removed: reputation.][added: ability to grow our business.]

Exchange rate fluctuations [removed: and foreign exchange hedging arrangements] could result in significant foreign currency gains and losses and affect our business results.

[removed: currency risk entirely for the currencies that they do cover, and involve costs and risks of] [added: Our hedging arrangements may also create] their own [added: costs and risks,] in the form of transaction costs, credit requirements, and counterparty risk.

Many factors can affect the reputation and value of our Company or one or more of our properties or brands, including our ability to protect and use our brands and trademarks; our [removed: hotels’] [added: properties’] adherence to service and other brand standards; our approach to, or incidents involving, matters related to food quality and safety, guest and associate safety, health and cleanliness, managing and reducing our carbon footprint and our use of scarce natural resources, supply chain management, and diversity, human rights, and support for local communities; and our compliance with applicable laws.

Reputational value is also based on perceptions, and broad access to social media makes it easy for anyone to provide public feedback that can influence perceptions of us, our brands, and our [removed: hotels,] [added: properties,] and it may be difficult to control or effectively manage negative publicity, regardless of whether it is accurate.

We franchise and license many of our brand names and trademarks to third parties for lodging, timeshare, and residential properties, and with respect to our credit card [removed: programs.][added: programs and other offerings.]

Although our agreements with these parties provide us with recourse and remedies in the event of a breach, including termination of the agreements under certain circumstances, it could be expensive or time-consuming for us to pursue such remedies and even if we are successful in pursuing such remedies, that may not be sufficient to mitigate reputational harm [removed: to us.]

Labor disputes and disruptions [removed: have in the past, and] could [removed: in the future,] result in adverse publicity or regulatory investigations and adversely affect operations and revenues at affected [removed: hotels.][added: hotels, as we have seen at times in the past.]

[added: Labor] shortages have resulted and could continue to result in higher wages and initial hiring costs, increasing our labor costs and labor costs at our hotels, which could reduce our revenues and profits.

[removed: Climate change] [added: Extreme weather, climate change,] and [removed: sustainability related] [added: sustainability-related] concerns could have a material adverse effect on our business and results of [removed: operations.] [added: operations.] We are subject to the risks associated with [added: extreme weather and climate change, including] the [added: impacts of the] physical effects of climate [removed: change (including changes in sea levels, water shortages, droughts, and the natural disasters discussed in the preceding paragraph) and with] [added: change,] changes in laws and regulations related to climate change and [removed: sustainability.][added: sustainability, and changing consumer preferences.]

Compliance with future climate-related legislation and regulation, and our [added: current or future voluntary] efforts to achieve science-based emissions reduction [removed: targets,] [added: targets or other sustainability initiatives,] could [added: also] be difficult and costly.

As a result of the foregoing, we may experience [added: reduced demand,] significant increased operating and compliance costs, operating disruptions or limitations, [removed: reduced demand,] constraints on our [added: room] growth, and [added: even] physical damage to our hotels, all of which could adversely affect our [removed: profits.][added: profits and growth.]

[removed: We require comprehensive property and liability insurance] policies for our managed, leased, and owned properties with coverage features and insured limits that we believe are customary.

For example, over the past several years following the severe and widespread damage caused by natural disasters, coupled with continued large global losses, the property, [removed: liability] [added: liability,] and other insurance markets have seen significant cost increases.

If our brands, [removed: goodwill, or] [added: goodwill, or] other intangible assets become impaired, we may be required to record significant non-cash charges to [removed: earnings.][added: earnings. As of December 31, 2022, we had $17.6 billion of goodwill and other intangible assets.]

This presents a number of risks, including that: (1) [removed: weakness in the capital markets] [added: market conditions] may limit [removed: our ability, or that] [added: the availability] of [removed: third parties with whom we partner, to raise] capital for [added: project] completion [removed: of projects; (2)] [added: or take-out financing or make] properties that we renovate [removed: could become] less attractive [removed: due] to [removed: decreases in demand for hotel properties, market absorption or oversupply,] [added: potential purchasers,] with the result that we may not be able to [added: complete or] sell such properties [removed: for a profit or] at the prices or [removed: time] [added: times] we [removed: anticipate,] [added: anticipate] or we may be required to record additional impairment charges; and [removed: (3)] [added: (2)] construction delays or cost overruns, including those due to general market conditions, shortages or increased costs of skilled labor and/or materials, lender financial defaults, or so-called “Acts of God” such as earthquakes, hurricanes, floods, or fires may increase project costs.

We may seek to sell some of these properties over time; however, equity real estate investments can be difficult to sell [removed: quickly and COVID-19 has disrupted the transaction markets for some hospitality assets.][added: quickly.]

Moreover, the investment returns available from equity investments in real estate depend in large part on the amount of income earned and capital appreciation generated, if any, by the [removed: related] [added: particular] properties, and the expenses incurred.

A variety of other factors also affect income from properties and real estate values, including local market conditions and new supply of [removed: hotels,] [added: hotels and other lodging products,] availability and costs of staffing, governmental regulations, insurance, zoning, tax and eminent domain laws, interest rate levels, and the availability of financing.

Our real estate [removed: properties] [added: investments] have been, and could in the future be, impacted by any of these factors, resulting in a material adverse impact on our results of operations or financial condition.

If our properties [removed: continue to] [added: do] not generate revenue sufficient to meet operating [removed: expenses, including] [added: expenses and make] needed capital expenditures, our income could be [removed: further] adversely affected, and we could be required to record additional significant non-cash impairment charges to our results of operations.

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- adversely affecting associate hiring and retention.

Although COVID-19’s negative impact on our business, operations, and financial results has significantly decreased since 2020, we are continuing to see some of the foregoing effects and could see additional effects in the future.

The nature of our responsibilities under our management agreements to manage each hotel and enforce the standards required for our brands under both management and franchise agreements may be subject to interpretation.

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These laws, regulations, and government policies may be complex and change frequently and could have a range of adverse effects on our business.

Even though we enter into foreign exchange hedging arrangements for some of the currencies in which we do business, exchange rate fluctuations could result in significant foreign currency gains and losses and affect our results.

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to us.

Natural disasters and extreme weather in locations where we manage, franchise, own or lease properties or in areas of the world from which we draw a large number of guests may cause a significant decline in travel and reduced demand for lodging.

The prevalence of these events may continue to increase as the result of climate change.

Natural disasters, extreme weather, and other physical impacts of climate change (including rising sea levels, extreme hot or cold weather, water shortages, fire, and droughts) have in the past and could in the future result in increases in related insurance, energy or other operating costs, and physical damage to our hotels that might not be covered by insurance and might prevent or limit the operations of the property.

Significant costs could be involved in improving the efficiency and climate resiliency of our hotels and otherwise preparing for, responding to, and mitigating the physical effects of climate change or sustainability-related concerns.

Growing public recognition of the dangers of climate change and other sustainability-related concerns may affect customers’ travel choices, including their frequency of travel.

We require comprehensive property and liability insurance

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upgrade, or prevent disruption to these systems.

We are currently undertaking a multi-year initiative to upgrade certain of our core technologies and systems, as these and other technologies and systems described in this risk factor must be refined, updated, and/or replaced with more advanced systems on a regular basis.

Our business could also suffer if the use of technologies that provide alternatives to in-person meetings and events results in a decrease in demand for our lodging properties.

Efforts to hack or circumvent security measures, efforts to gain unauthorized access to, exploit or disrupt the operation or integrity of our data or systems, failures of systems or software to operate as designed or intended, viruses, “ransomware” or other malware,

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Our governing corporate documents

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Risks Relating to COVID-19

COVID-19 has had a material detrimental impact on our business and financial results, and such impact could continue and may worsen for an unknown period of time.

COVID-19 has been and continues to be a complex and evolving situation, with governments, public institutions and other organizations imposing or recommending, and businesses and individuals implementing, at various times and to varying degrees, restrictions on various activities or other actions to combat its spread, such as warnings, restrictions and bans on travel, transportation or in-person gatherings; closures of, or occupancy or other operating limitations on, work facilities, lodging facilities, food and beverage establishments, schools, public buildings and businesses; cancellation of events, including sporting events, conferences and meetings; and quarantines and lock-downs.

- impacting the ability of our managed and franchised hotels, owned and leased hotels, and properties in which we have an investment to meet expenses, including payment of amounts owed to us;

- adversely affecting our ability to attract and retain associates.

The extent to which COVID-19 impacts our business, operations, and financial results will depend on the factors described above and numerous other evolving factors that we may not be able to accurately predict or assess, including the continued duration and scope of COVID-19; the availability, effectiveness and acceptance of vaccines and treatments; COVID-19’s impact on global and regional economies and economic activity, unemployment rates and consumer discretionary spending; COVID-19’s short and longer-term impact on the demand for travel, including business transient and group business, and levels of consumer confidence; and the extent to which the recovery of travel and lodging demand is disrupted by new COVID-19 variants or other dislocations in pandemic recovery.

Further, COVID-19 may also affect our operating and financial results in a manner that is not presently known to us or that we currently do not consider to present significant risks to our operations.

As discussed in “Risks Relating to COVID-19,” our performance has been materially affected by some of these conditions and could be further materially affected if these conditions worsen, arise in the future, or extend longer than anticipated, or in other circumstances that we are not able to predict or mitigate.

Even after COVID-19 subsides, our business, markets, growth prospects, and business model could continue to be materially impacted or altered.

Booking.com, Travelocity.com, and Orbitz.com, as well as lesser-known online travel service providers.

For example, if newly negotiated agreements are on terms less favorable to our hotels than the expiring agreements, or if we are not able to negotiate new agreements and our hotels no longer appear on intermediary websites, our bookings could decline, our profits (and the operating profits of hotels in our system) could decline, and customers and owners may be less attracted to our brands.

We may not be able to recapture or offset any such loss of business through actions we take to enhance our direct marketing and reservation channels or to rely on other channels or other intermediary websites.

The significance of our operations outside of the U.S. makes us susceptible to the risks of doing business internationally, which could lower our revenues, increase our costs, reduce our profits, disrupt our business, or damage our reputation.

A significant number of rooms in our system are located outside of the U.S. and its territories, which exposes us to certain challenges and risks, many of which are outside of our control, and which could materially reduce our revenues or profits, materially increase our costs, result in significant liabilities or sanctions, significantly disrupt our business, or significantly damage our reputation.

These challenges and risks include: (1) compliance with complex and changing laws, regulations, and government policies, including sanctions, that could have a material negative impact on our operations or our ability to pursue development opportunities, cause reputational damage, or otherwise affect us; (2) the difficulties involved in managing an organization doing business in many different countries; (3) uncertainties regarding the interpretation of local laws and the enforceability of contract and intellectual property rights under local laws; and (4) rapid changes in government policy, political or civil unrest, acts of terrorism, war, pandemics or other health emergencies, border control measures or other travel restrictions, or the threat of international boycotts or U.S. anti-boycott legislation.

We enter into foreign exchange hedging agreements with financial institutions to mitigate exposure to some of the foreign currency fluctuations, but these efforts may not be successful.

These hedging agreements also do not cover all currencies in which we do business, do not eliminate foreign

Labor

Risks relating to natural or man-made disasters, contagious diseases, violence, or war have reduced the demand for lodging, which has adversely affected our revenues.

We have seen a decline in travel and reduced demand for lodging due to so-called “Acts of God,” such as severe storms, hurricanes, earthquakes, tsunamis, floods, volcanic activity, wildfires, and other natural disasters, as well as man-made disasters and the spread of contagious diseases in locations where we own, manage, or franchise properties and areas of the world from which we draw a large number of guests, and these circumstances could continue or worsen in the future to an extent and for durations that we are not able to predict.

Actual or threatened war, terrorist activity, political unrest, civil or geopolitical strife, and other acts of violence could have a similar effect.

As with the effects we have already experienced from the COVID-19 pandemic, any one or more of these events may reduce the overall demand for lodging, limit the room rates that can be charged, affect our growth, and/or increase our operating costs, all of which could adversely affect our profits.

If a terrorist event or other incident of violence were to involve one or more of our branded properties, demand for our properties in particular could suffer disproportionately, which could further hurt our revenues and profits.

Consumer travel preferences may also shift due to sustainability related concerns or costs.

As of December 31, 2021, we had $18.0 billion of goodwill and other intangible assets.

Changes affecting the availability of the London Interbank Offered Rate (“LIBOR”) may have consequences that we cannot yet fully predict.

We are a party to various agreements, such as our multicurrency revolving credit agreement (as amended, the “Credit Facility”), and other instruments where obligations by or to us are calculated based on or otherwise dependent on LIBOR, many of which have not yet replaced LIBOR with an alternative benchmark rate.

Effective January 1, 2022, the one week and two month USD LIBOR tenors and all tenors for EUR, CHF, JPY and GBP LIBOR are no longer being published, and all other USD LIBOR tenors will cease to be published after June 30, 2023.

At this time, it is difficult for us to predict the full effect of any changes from LIBOR to an alternative benchmark rate upon or prior to the final LIBOR cessation date, the phase out of LIBOR generally, or the establishment and use of particular alternative benchmark rates to replace LIBOR.

There continues to be uncertainty about how we, the financial markets, applicable law, and the courts will address the replacement of LIBOR with alternative benchmark rates for contracts that do not include fallback provisions to provide for such alternative benchmark rates.

In addition, any changes from LIBOR to an alternative benchmark rate may have an uncertain impact on our cost of funds, our receipts or payments under agreements that reference LIBOR, and the valuation of derivative or other contracts to which we are a party, any of which could impact our results of operations and cash flows.

and loyalty data, and other personal information, in various information systems that we maintain and in systems maintained by third parties, including our owners, franchisees, licensees, and service providers.

In addition, following our March 31, 2020 announcement of an incident involving information for approximately 5.5 million guests that we believe may have been improperly accessed through an application using the login credentials of two franchise employees at a franchise property (the “Unauthorized Application Access Incident”), various governmental authorities opened investigations or requested information about the incident, and two lawsuits were filed against us related to the incident which have since been dismissed or otherwise resolved.

The Unauthorized Application Access Incident or publicity related to it could negatively affect our business or reputation.

Following the Data Security Incident, certain regulators also opened investigations into our privacy and security policies and practices.

As a result of these investigations, we could be exposed to significant fines and remediation costs in addition to those imposed as a result of the Data Security Incident, and adverse publicity related to the investigations could adversely affect our reputation.

*A discussion regarding our financial condition and results of operations for year-end [removed: 2020] [added: 2021] compared to year-end [removed: 2019] [added: 2020] can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual Report on Form [removed: 10-K/A] [added: 10-K] for the fiscal year ended December 31, [removed: 2020,] [added: 2021,] as filed with the SEC on [removed: April 2, 2021 (“2020] [added: February 15, 2022 (“2021] Form 10-K”).*

We are a worldwide operator, franchisor, and licensor of hotel, residential, [added: timeshare,] and [removed: timeshare] [added: other lodging] properties in [removed: 139] [added: 138] countries and territories under 30 brand names.

We discuss our operations in the following reportable business segments: [added: (1)] U.S. & Canada and [added: (2)] International.

Additionally, we earn franchise fees for [added: the] use of our intellectual property, [removed: including] [added: such as] fees from our [removed: co-brand] [added: co-branded] credit card, timeshare, and residential programs.

We define our comparable properties as our properties that were open and operating under one of our brands since the beginning of the last full calendar year (since January 1, [removed: 2020] [added: 2021] for the current period) and have not, in either the current or previous year: (1) undergone significant room or public space renovations or expansions, (2) been converted between company-operated and franchised, or (3) sustained substantial property damage or business interruption, with the exception of properties closed or otherwise experiencing interruptions related to COVID-19, which we continue to classify as comparable.

For [removed: 2021] [added: 2022] compared to [removed: 2020,] [added: 2021,] we had [removed: 4,906] [added: 5,123] comparable U.S. & Canada properties and [removed: 1,510] [added: 1,548] comparable International properties.

[removed: The] RevPAR, [removed: ADR,] [added: occupancy,] and [removed: occupancy] [added: ADR] comparisons between [removed: 2021] [added: 2022] and 2019, which we discuss under the [removed: “Impact of COVID-19”] [added: “Business Trends”] caption below, reflect properties that are defined as comparable as of December 31, [removed: 2021,] [added: 2022, September 30, 2022, June 30, 2022, or March 31, 2022 (as applicable),] even if in 2019 they were not open and operating for the full year or did not meet all the other criteria listed above.

[removed: Comparable systemwide constant dollar] RevPAR in [removed: 2021] [added: 2022] compared to [removed: 2020] [added: 2021] improved [removed: 67.7] [added: 46.5] percent in our U.S. & Canada segment, [removed: 40.6] [added: 66.2] percent in our International segment, and [removed: 60.4] [added: 51.0] percent worldwide.

[removed: Comparable systemwide constant dollar] RevPAR in [removed: 2021] [added: 2022] compared to pre-pandemic 2019 levels declined [removed: 32.5 percent in our U.S. & Canada segment, 46.6 percent in our International segment, and 36.5] [added: 4.0] percent worldwide, with improvement in the decline each succeeding quarter during [removed: 2021] [added: 2022] for each of our segments and worldwide.

We are currently unable to [added: reasonably] estimate the range of total possible financial impact to the Company from the Data Security Incident in excess of the expenses already [removed: incurred.][added: recorded.]

Although our insurance program includes coverage designed to limit our exposure to losses such as those related to the Data Security Incident, that insurance may not be sufficient or available to cover all of our expenses or other losses (including [removed: fines and penalties)] [added: monetary payments to regulators and/or litigants)] related to the Data Security Incident.

We expect to incur significant expenses associated with the Data Security Incident in future [removed: periods,] [added: periods in excess of the amounts already recorded,] primarily related to legal proceedings and regulatory investigations (including possible additional [removed: fines and penalties), increased expenses and capital investments for information technology and information security and data privacy, and increased expenses for compliance activities and] [added: monetary payments] to [removed: meet increased legal and regulatory requirements.][added: regulators and/or litigants as well as costs associated with compliance with any settlements or resolutions of matters).]

See Note 7 for additional information related to [removed: expenses incurred in 2021, insurance recoveries, and] legal proceedings and governmental investigations related to the Data Security Incident.

Approximately [removed: 50] [added: 61] percent of our [removed: 2021] [added: 2022] gross room additions [removed: are] [added: were] located outside U.S. & Canada, and [removed: 21] [added: 27] percent were conversions from competitor brands.

At year-end [removed: 2021,] [added: 2022,] we had [removed: roughly 485,000] [added: more than 496,000 hotel] rooms in our development pipeline, which includes [removed: more than 202,000] [added: approximately 199,000] hotel rooms under construction and [removed: approximately 19,000] [added: roughly 22,300] hotel rooms approved for development but not yet under signed contracts.

In [removed: 2021,] [added: 2022,] we signed [added: 726 new] management and franchise [removed: agreements for 599 properties,] [added: agreements,] representing [removed: approximately 92,000] [added: nearly 108,000] rooms, of which [removed: more than] [added: approximately] half of the rooms are located outside U.S. & Canada.

In [removed: addition, in 2021,] [added: particular, our] longer stay brands, which include Element Hotels, Residence Inn, and TownePlace Suites, accounted for [removed: 37] [added: 30] percent of the [removed: Company's rooms] [added: Company’s] signings in [removed: U.S. & Canada.][added: 2022.]

Conversions accounted for [removed: 27] [added: nearly 20] percent of rooms signings in [removed: 2021.][added: 2022.]

At year-end [removed: 2021,] [added: 2022,] we operated, franchised, and licensed the following properties and rooms:

The following tables present RevPAR, occupancy, and ADR statistics for comparable properties for [removed: 2021] [added: 2022,] and [removed: 2021] [added: 2022] compared to [removed: 2020.][added: 2021.]

| | | | [removed: 2021] [added: 2022] | | | | | | vs. [removed: 2020] [added: 2021] | | | | | | [removed: 2021] [added: 2022] | | | | | | vs. [removed: 2020] [added: 2021] | | | | | | | | | [removed: 2021] [added: 2022] | | | | | | vs. [removed: 2020] [added: 2021] | | |

[removed: See the “Impact of COVID-19” section above for more information about the impact to our business during 2021, and the] [added: The] discussion below [removed: for] [added: presents an] additional analysis of our consolidated results of operations for [removed: 2021] [added: 2022] compared to [removed: 2020.][added: 2021.]

| *($ in millions)* | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | | | | | | | Change [removed: 2021] [added: 2022] vs. [removed: 2020] [added: 2021] | | | | | | | | | | | | | | | | | | | | |

| Base management fees | | | $ | [removed: 669] [added: 1,044] | | | | | $ | [removed: 443] [added: 669] | | | | | | | | | | | $ | [removed: 226] [added: 375] | | | | | [removed: 51] [added: 56] | | % | | | | | | | | | | | | |

| Franchise fees | | | [removed: 1,790] [added: 2,505] | | | | | | [removed: 1,153] [added: 1,790] | | | | | | | | | | | | [removed: 637] [added: 715] | | | | | | [removed: 55] [added: 40] | | % | | | | | | | | | | | | |

| Incentive management fees | | | [removed: 235] [added: 529] | | | | | | [removed: 87] [added: 235] | | | | | | | | | | | | [removed: 148] [added: 294] | | | | | | [removed: 170] [added: 125] | | % | | | | | | | | | | | | |

| Gross fee revenues | | | [removed: 2,694] [added: 4,078] | | | | | | [removed: 1,683] [added: 2,694] | | | | | | | | | | | | [removed: 1,011] [added: 1,384] | | | | | | [removed: 60] [added: 51] | | % | | | | | | | | | | | | |

| Contract investment amortization | | | [removed: (75)] [added: (89)] | | | | | | [removed: (132)] [added: (75)] | | | | | | | | | | | | [removed: 57] [added: (14)] | | | | | | [removed: 43] [added: (19)] | | % | | | | | | | | | | | | |

| Net fee revenues | | | $ | [removed: 2,619] [added: 3,989] | | | | | $ | [removed: 1,551] [added: 2,619] | | | | | | | | | | | $ | [removed: 1,068] [added: 1,370] | | | | | [removed: 69] [added: 52] | | % | | | | | | | | | | | | |

In [removed: 2021,] [added: 2022,] we earned incentive management fees from [removed: 47] [added: 61] percent of our managed properties worldwide, compared to [removed: 37] [added: 47] percent in [removed: 2020.][added: 2021.]

We earned incentive management fees from [removed: 13] [added: 29] percent of our U.S. & Canada managed properties and [removed: 63] [added: 76] percent of our International managed properties in [removed: 2021,] [added: 2022,] compared to [removed: 3] [added: 13] percent in U.S. & Canada and [removed: 56] [added: 63] percent in International in [removed: 2020.][added: 2021.]

In addition, [removed: 71] [added: 58] percent of our total incentive management fees in [removed: 2021] [added: 2022] came from our International managed properties versus [removed: 92] [added: 71] percent in [removed: 2020.][added: 2021.]

| Owned, leased, and other revenue | | | $ | [removed: 796] [added: 1,367] | | | | | $ | [removed: 568] [added: 796] | | | | | | | | | | | $ | [removed: 228] [added: 571] | | | | | [removed: 40] [added: 72] | | % | | | | | | | | | | | | |

| Owned, leased, and other - direct expenses | | | [removed: 734] [added: 1,074] | | | | | | [removed: 677] [added: 734] | | | | | | | | | | | | [removed: 57] [added: 340] | | | | | | [removed: 8] [added: 46] | | % | | | | | | | | | | | | |

| Owned, leased, and other, net | | | $ | [removed: 62] [added: 293] | | | | | $ | [removed: (109)] [added: 62] | | | | | | | | | | | $ | [removed: 171] [added: 231] | | | | | [removed: nm*] [added: 373] | | [added: %] | | | | | | | | | | | | |

| Cost reimbursement revenue | | | $ | [removed: 10,442] [added: 15,417] | | | | | $ | [removed: 8,452] [added: 10,442] | | | | | | | | | | | $ | [removed: 1,990] [added: 4,975] | | | | | [removed: 24] [added: 48] | | % | | | | | | | | | | | | |

| Reimbursed expenses | | | [removed: 10,322] [added: 15,141] | | | | | | [removed: 8,435] [added: 10,322] | | | | | | | | | | | | [removed: 1,887] [added: 4,819] | | | | | | [removed: 22] [added: 47] | | % | | | | | | | | | | | | |

| Cost reimbursements, net | | | $ | [removed: 120] [added: 276] | | | | | $ | [removed: 17] [added: 120] | | | | | | | | | | | $ | [removed: 103] [added: 156] | | | | | [removed: nm*] [added: 130] | | [added: %] | | | | | | | | | | | | |

The increase in cost reimbursements, net primarily reflects higher revenues, net of expenses, for our centralized programs and [removed: services.][added: services as well as our insurance program.]

| Depreciation, amortization, and other | | | $ | [removed: 220] [added: 193] | | | | | $ | [removed: 346] [added: 220] | | | | | | | | | | | $ | [removed: (126)] [added: (27)] | | | | | [removed: (36)] [added: (12)] | | % | | | | | | | | | | | | |

Terms of our management agreements vary, but our management fees generally consist of base management fees and incentive management fees.

Base management fees are typically calculated as a percentage of property-level revenue.

Incentive management fees are typically calculated as a percentage of a hotel profitability measure, and, in many cases (particularly in our U.S. & Canada, Europe, and Caribbean & Latin America regions), are subject to a specified owner return.

Under our franchise agreements, franchise fees are typically calculated as a percentage of property-level revenue or a portion thereof.

RevPAR, occupancy, and ADR statistics are on a systemwide basis for comparable properties, unless otherwise stated.

Unless otherwise stated, all comparisons to pre-pandemic or 2019 are comparing to the same time period each year.

*Business Trends*

We continued to see strong global RevPAR improvement throughout 2022 despite Greater China continuing to be significantly negatively impacted by COVID-19 through the end of the 2022 fourth quarter.

While RevPAR recovery at the beginning of 2022 was dampened due to the emergence of COVID-19 variants, RevPAR quickly improved, resulting in 2022 third quarter worldwide RevPAR exceeding 2019 levels for the first time since the pandemic began.

By the 2022 fourth quarter,

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

worldwide RevPAR exceeded 2019 levels by 4.6 percent, reflecting ADR growth of 12.8 percent, partially offset by a decline in occupancy of 5.1 percentage points compared to 2019 levels.

The global recovery continued across all customer segments, led by robust leisure demand as well as strengthening group demand, which was higher than 2019 levels in certain regions during the 2022 fourth quarter.

Business transient demand also continued to improve during 2022, although it continued to lag behind 2019 levels.

In the U.S. & Canada, RevPAR declined only 0.8 percent in 2022 compared to 2019, due to a decline in occupancy of 6.0 percentage points, partially offset by ADR growth of 8.1 percent.

In the 2022 fourth quarter, U.S. & Canada RevPAR improved 5.2 percent compared to the same period in 2019, due to ADR growth of 11.1 percent, partially offset by a decline in occupancy of 3.7 percentage points.

The decline in occupancy as compared to 2019 improved sequentially in each quarter of 2022, reflecting strong demand recovery in many markets within the U.S. & Canada.

Internationally, RevPAR declined 11.9 percent in 2022 compared to 2019, due to a decline in occupancy of 12.2 percentage points, partially offset by ADR growth of 7.0 percent.

In the 2022 fourth quarter, International RevPAR improved 3.4 percent compared to the same period in 2019, due to ADR growth of 17.3 percent, partially offset by a decline in occupancy of 8.3 percentage points.

In the 2022 fourth quarter, RevPAR remained significantly below 2019 levels in Greater China, but exceeded pre-pandemic 2019 levels in the Caribbean & Latin America, Europe, Middle East & Africa, and Asia Pacific excluding China regions, driven by strengthening demand, especially from cross-border guests and meaningful growth in ADR.

Although COVID-19’s negative impact on our business has significantly decreased and we saw strong global RevPAR improvement in 2022, our business is subject to the effects of changes in global and regional conditions and these conditions can change rapidly.

We continue to monitor global economic conditions, and although we are not currently seeing signs of a slowdown in lodging demand, the lodging booking window is short and trends can change quickly.

In 2022, our system grew from 7,989 properties (1,479,179 rooms) at year-end 2021 to 8,288 properties (1,525,407 rooms) at year-end 2022, reflecting gross additions of 394 properties (65,376 rooms) and deletions of 94 properties (19,079 rooms), including the impact of the Company’s decision to suspend its operations in Russia.

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

Our Select hotel brands continued to be a key growth driver globally with 523 hotel properties signed during 2022.

In addition, contracts signed in 2022 reflected the Company’s strength in the luxury tier, with 42 luxury hotel agreements signed, representing nearly 8,000 rooms.

In 2023, we expect total gross rooms growth of approximately 5.5 percent and net rooms growth of 4.0 to 4.5 percent, including approximately 1.1 percent from the anticipated addition of rooms associated with the City Express brand acquisition discussed in Note 3, which are not reflected in the development pipeline discussed above.

| U.S. & Canada | | | 632 | | | | | | 215,331 | | | | | | 5,121 | | | | | | 735,470 | | | | | | 26 | | | | | | 6,483 | | | | | | | | | | | | | | | | | | 67 | | | | | | 7,128 | | | | | | 5,846 | | | | | | 964,412 | | |

| International | | | 1,357 | | | | | | 345,220 | | | | | | 907 | | | | | | 179,319 | | | | | | 38 | | | | | | 9,209 | | | | | | | | | | | | | | | | | | 46 | | | | | | 4,353 | | | | | | 2,348 | | | | | | 538,101 | | |

| Timeshare | | | — | | | | | | — | | | | | | 93 | | | | | | 22,745 | | | | | | — | | | | | | — | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | 93 | | | | | | 22,745 | | |

| Yacht | | | — | | | | | | — | | | | | | 1 | | | | | | 149 | | | | | | — | | | | | | — | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | 1 | | | | | | 149 | | |

| Total | | | 1,989 | | | | | | 560,551 | | | | | | 6,122 | | | | | | 937,683 | | | | | | 64 | | | | | | 15,692 | | | | | | | | | | | | | | | | | | 113 | | | | | | 11,481 | | | | | | 8,288 | | | | | | 1,525,407 | | |

| U.S. & Canada | | | $ | 159.06 | | | | | 67.0 | | % | | | | 65.3 | | % | | | | 17.9 | | % | pts. | | | | | | $ | 243.73 | | | | | 21.3 | | % |

| Greater China | | | $ | 53.22 | | | | | (18.5) | | % | | | | 47.5 | | % | | | | (8.0) | | % | pts. | | | | | | $ | 112.14 | | | | | (4.8) | | % |

| Asia Pacific excluding China | | | $ | 84.41 | | | | | 122.5 | | % | | | | 59.2 | | % | | | | 23.1 | | % | pts. | | | | | | $ | 142.60 | | | | | 35.8 | | % |

| Caribbean & Latin America | | | $ | 126.55 | | | | | 67.0 | | % | | | | 60.8 | | % | | | | 17.7 | | % | pts. | | | | | | $ | 208.17 | | | | | 18.4 | | % |

| Europe | | | $ | 153.51 | | | | | 148.3 | | % | | | | 63.5 | | % | | | | 30.3 | | % | pts. | | | | | | $ | 241.65 | | | | | 29.9 | | % |

| Middle East & Africa | | | $ | 124.63 | | | | | 52.8 | | % | | | | 64.7 | | % | | | | 13.1 | | % | pts. | | | | | | $ | 192.54 | | | | | 22.0 | | % |

| International - All (1) | | | $ | 94.64 | | | | | 55.5 | | % | | | | 57.0 | | % | | | | 11.7 | | % | pts. | | | | | | $ | 166.06 | | | | | 23.4 | | % |

| Worldwide (2) | | | $ | 123.30 | | | | | 61.9 | | % | | | | 60.7 | | % | | | | 14.5 | | % | pts. | | | | | | $ | 203.23 | | | | | 23.3 | | % |

We earn base management fees and, under many agreements, incentive management fees from the properties that we manage, and we earn franchise fees on the properties that others operate under franchise agreements with us.

In most markets, base management and franchise fees typically consist of a percentage of property-level revenue, or certain property-level revenue in the case of franchise fees, while incentive management fees typically consist of a percentage of net house profit after a specified owner return.

For our hotels in the Middle East and Africa, Asia Pacific excluding China, and Greater China regions, incentive management fees typically consist of a percentage of gross operating profit without adjustment for a specified owner return.

Net house profit is calculated as gross operating profit (also referred to as “house profit”) less non-controllable expenses such as property insurance, real estate taxes, and furniture, fixtures, and equipment (FF&E) reserves.

We refer to the Starwood business and brands that we acquired as “Legacy-Starwood.”

*Impact of COVID-19*

COVID-19 continues to have a material impact on our business and industry.

However, the recovery of both global demand and ADR continued in 2021, led primarily by robust leisure demand, which we expect to continue in 2022, and travelers who continue to embrace multi-purpose trips, mixing remote work and vacation time.

The spread of COVID-19 variants, such as Delta and Omicron, constrained the pace of the recovery in the latter half of 2021 and continues to constrain the pace of recovery in the beginning of 2022.

Business transient and group demand continued to slowly improve in 2021 when

compared to 2020, though this demand still remains meaningfully below pre-pandemic 2019 levels.

Although we have seen delays in the recovery of business transient and group demand as a result of the emergence of COVID-19 variants, we expect this demand to gradually strengthen from current levels as more workers return to the office and travel again.

We have been encouraged by the swift improvement in ADR, which in the 2021 second half returned to pre-pandemic 2019 levels in certain U.S. and International markets and are optimistic about sustaining strong ADR in 2022.

However, we believe COVID-19 will continue to have a material negative impact on our future results for a period of time that we are currently unable to predict.

Worldwide comparable systemwide occupancy and constant dollar ADR were down only 11.9 percentage points and 2.3 percent, respectively, in the 2021 fourth quarter compared to the 2019 fourth quarter, leading to RevPAR 19.0 percent below pre-pandemic 2019 levels.

In the U.S. & Canada, demand continued to recover in 2021, driven by strong leisure demand particularly at our luxury and resort hotels and in tertiary markets.

Occupancy peaked in the 2021 third quarter before decreasing slightly in the 2021 fourth quarter primarily due to seasonality.

Urban destinations, where we have a large presence in the U.S. & Canada, experienced meaningful improvement in demand in 2021, though they continue to lag the recovery.

In other parts of the world, RevPAR continues to vary greatly by geographic market, and demand is heavily impacted by the number of COVID-19 cases, vaccination rates, and the nature and degree of government restrictions.

In the 2021 fourth quarter, the decline of comparable systemwide constant dollar RevPAR when compared to pre-pandemic 2019 levels improved compared to the decline seen in the 2021 third quarter in all our International regions except for Greater China, which remained flat as a result of strict government restrictions in response to COVID-19 outbreaks in several regions.

We continue to take measures to mitigate the negative financial and operational impacts of COVID-19 for our hotel owners and our own business.

At the corporate level, we remain focused on managing our corporate general and administrative costs and are being disciplined with respect to our capital expenditures and other investment spending.

Share repurchases and cash dividends remain suspended until our leverage ratios further improve, although assuming there is no meaningful setback in the global recovery from COVID-19, we could restart some level of capital returns in the second half of 2022 and more meaningful levels of capital returns in 2023 and beyond.

In 2021, we substantially completed restructuring plans to achieve cost savings specific to our company-operated properties.

In addition, we continue to work with owners and franchisees by adjusting renovation requirements for certain properties, deferring certain hotel initiatives, and supporting owners and franchisees who are working with their lenders to utilize FF&E reserves to meet working capital needs.

We continue to evaluate the availability of stimulus tax credits under the Coronavirus Aid, Relief, and Economic Security Act, the Taxpayer Certainty and Disaster Tax Relief Act of 2020 enacted as part of the Consolidated Appropriations Act, 2021, the American Rescue Plan Act of 2021 (“ARPA”), and other legislation.

As of February 1, 2022, we have received Employee Retention Tax Credit (“ERTC”) refunds from the U.S. Treasury totaling $170 million, including $119 million in 2020 and $51 million in 2021, of which we passed through $94 million and $48 million, respectively, to the related hotels that we manage on behalf of owners.

We have received from the U.S. Treasury substantially all expected ERTC refunds based on applications that we have submitted as of February 1, 2022.

Additionally, as of December 31, 2021, we have received or expect to receive, through Medicare tax offsets and payments from the U.S. Treasury pursuant to ARPA, a total of $35 million as reimbursement for the cost of health coverage continuation provided to eligible former associates and furloughed or part-time associates (and their eligible enrolled dependents) in accordance with requirements under the Consolidated Omnibus Budget Reconciliation Act of 1985 for the period of April 1, 2021 to September 30, 2021.

Finally, in 2021, we received subsidies totaling $28 million from German government COVID-19 assistance programs for certain of our leased hotels and equity method investments in Germany.

The impact of COVID-19 on the Company remains fluid, as does our corporate and property-level response.

We expect to continue to assess the situation and may implement additional measures to adapt our operations and plans to address the implications of COVID-19 on our business.

The overall operational and financial impact is highly dependent on the breadth and duration of COVID-19 and could be affected by other factors we are not currently able to predict.

In 2021, our system grew from 7,642 properties (1,423,044 rooms) at year-end 2020 to 7,989 properties (1,479,179 rooms) at year-end 2021, reflecting gross additions of 517 properties (86,372 rooms) and deletions of 171 properties (30,236 rooms), including 88 properties from a primarily select-service portfolio which left our system in the 2021 first quarter.

Contracts signed in 2021 reflected the Company’s strength in the luxury tier, with 40 properties signed (resulting in a total of nearly 50,000 luxury rooms in our development pipeline at year-end 2021), as well as strong momentum in all-inclusive resort signings, with 22 properties signed in 2021.

In 2022, we expect total gross rooms growth to approach 5.0 percent and net rooms growth of 3.5 to 4.0 percent.

| U.S. & Canada | | | 638 | | | | | | 218,798 | | | | | | 4,983 | | | | | | 713,781 | | | | | | 26 | | | | | | 6,483 | | | | | | | | | | | | | | | | | | 65 | | | | | | 6,925 | | | | | | 5,712 | | | | | | 945,987 | | |

| International | | | 1,305 | | | | | | 334,374 | | | | | | 805 | | | | | | 163,955 | | | | | | 38 | | | | | | 9,209 | | | | | | | | | | | | | | | | | | 37 | | | | | | 2,953 | | | | | | 2,185 | | | | | | 510,491 | | |

| Timeshare | | | — | | | | | | — | | | | | | 92 | | | | | | 22,701 | | | | | | — | | | | | | — | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | 92 | | | | | | 22,701 | | |

| Total | | | 1,943 | | | | | | 553,172 | | | | | | 5,880 | | | | | | 900,437 | | | | | | 64 | | | | | | 15,692 | | | | | | | | | | | | | | | | | | 102 | | | | | | 9,878 | | | | | | 7,989 | | | | | | 1,479,179 | | |

We are exposed to market risk from changes in interest [removed: rates, stock prices,] [added: rates and] currency exchange [removed: rates, and debt prices.][added: rates.]

The following table sets forth the scheduled maturities and the total fair value as of year-end [removed: 2021] [added: 2022] for our financial instruments that are impacted by market risks:

| *($ in millions)* | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2024] [added: 2025] | | | | | | [removed: 2025] [added: 2026] | | | | | | [removed: 2026] [added: 2027] | | | | | | There- after | | | | | | Total Carrying Amount | | | | | | Total Fair Value | | |

| Fixed-rate notes receivable | | | $ | [removed: 6] [added: 3] | | | | | $ | [removed: 2] [added: 17] | | | | | $ | [removed: 9] [added: 3] | | | | | $ | [removed: 2] [added: 1] | | | | | $ | [removed: 2] [added: 1] | | | | | $ | [removed: 28] [added: 25] | | | | | $ | [removed: 49] [added: 50] | | | | | $ | [removed: 43] [added: 45] | |

| Average interest rate | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [removed: 1.03] [added: 1.13] | | % | | | | | | |

| Floating-rate notes receivable | | | $ | [removed: 3] [added: 7] | | | | | $ | [removed: 42] [added: 81] | | | | | $ | [removed: 16] [added: 15] | | | | | $ | [removed: 1] [added: 4] | | | | | $ | [removed: 3] [added: 4] | | | | | $ | [removed: 39] [added: 1] | | | | | $ | [removed: 104] [added: 112] | | | | | $ | [removed: 97] [added: 107] | |

| Average interest rate | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [removed: 3.06] [added: 5.73] | | % | | | | | | |

| Average interest rate | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [removed: 3.69] [added: 3.92] | | % | | | | | | |

| Average interest rate | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [removed: 1.52] [added: 5.05] | | % | | | | | | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| Fixed-rate debt | | | $ | (676) | | | | | $ | — | | | | | $ | (1,301) | | | | | $ | (747) | | | | | $ | (984) | | | | | $ | (4,815) | | | | | $ | (8,523) | | | | | $ | (7,810) | |

| Floating-rate debt | | | $ | — | | | | | $ | (1,402) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | (1,402) | | | | | $ | (1,411) | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| Fixed-rate debt | | | $ | (572) | | | | | $ | (675) | | | | | $ | — | | | | | $ | (1,302) | | | | | $ | (746) | | | | | $ | (4,855) | | | | | $ | (8,150) | | | | | $ | (8,615) | |

| Floating-rate debt | | | $ | (226) | | | | | $ | — | | | | | $ | (1,616) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | (1,842) | | | | | $ | (1,853) | |

We are a worldwide operator, franchisor, and licensor of hotel, residential, [added: timeshare,] and [removed: timeshare] [added: other lodging] properties under numerous brand names at different price and service points.

Consistent with our focus on management, franchising, and licensing, we own [added: or lease] very few of our lodging [removed: properties.][added: properties (less than one percent of our system).]

The following table shows our portfolio of brands at year-end [removed: 2021.][added: 2022.]

[removed: ][added: ]

We discuss our operations in the following two operating segments, both of which meet the applicable accounting criteria for separate disclosure as a reportable business segment: [added: (1)] U.S. & Canada and [added: (2)] International.

At year-end [removed: 2021,] [added: 2022,] we had [removed: 2,007] [added: 2,053] company-operated properties [removed: (568,864] [added: (576,243] rooms), which included properties under long-term management or lease agreements with property owners (management and lease agreements together, the “Operating Agreements”) and properties that we own.

Such agreements are generally for initial periods of [removed: 15] [added: 20] to 30 years, with options for us to renew for up to 10 or more additional years.

We provide centralized programs and services, such as [removed: the Loyalty Program,] [added: our Marriott Bonvoy loyalty program,] reservations, and marketing, as well as various accounting and data processing services, and owners are [removed: also] required to reimburse us for those [removed: costs.][added: costs as well.]

Franchisees contribute to our centralized programs and services, such as [removed: the Loyalty Program,] [added: our Marriott Bonvoy loyalty program,] reservations, and marketing.

We also receive royalty fees under license agreements with Marriott Vacations Worldwide [removed: Corporation (“MVW”),] [added: Corporation,] our former timeshare subsidiary that we spun off in 2011, and its affiliates [added: (collectively, “MVW”),] for certain brands, including Marriott Vacation Club, Grand Residences by Marriott, The Ritz-Carlton Destination Club, Westin, Sheraton, and for certain existing properties, St. Regis and The Luxury Collection.

At year-end [removed: 2021,] [added: 2022,] we had [removed: 5,880] [added: 6,122] franchised and licensed properties [removed: (900,437 rooms).][added: (937,683 rooms and timeshare units).]

We have used or licensed the JW Marriott, The Ritz-Carlton, Ritz-Carlton Reserve, W, The Luxury Collection, St. Regis, EDITION, Bvlgari, Renaissance, Le Méridien, Marriott, Sheraton, Westin, Four Points, Delta [removed: Hotels, and] [added: Hotels by Marriott,] Autograph [removed: Collection] [added: Collection, and Tribute Portfolio] brand names and trademarks for residential real estate sales.

We believe that our brand names and other intellectual property have come to represent [removed: the highest standards of] [added: outstanding] quality, care, service, and value to our customers, guests, and the traveling public.

Our Classic Premium hotel brands include Marriott Hotels, Sheraton, Delta [removed: Hotels,] [added: Hotels by Marriott,] Marriott Executive Apartments, and Marriott Vacation Club.

The following table shows the geographic distribution of our brands at year-end [removed: 2021:][added: 2022:]

| [removed: JW] [added: AC Hotels by] Marriott® | | | Properties | | | [removed: 35] [added: 107] | | | [removed: 6] [added: 89] | | | [removed: 9] [added: 2] | | | [removed: 43] [added: 7] | | | [removed: 14] [added: 17] | | | [removed: 107] [added: 222] | | |

| The Ritz-Carlton® | | | Properties | | | [removed: 39] [added: 41] | | | 12 | | | [removed: 14] [added: 15] | | | 38 | | | [removed: 10] [added: 9] | | | [removed: 113] [added: 115] | | |

| W® Hotels | | | Properties | | | [removed: 24] [added: 25] | | | [removed: 6] [added: 8] | | | [removed: 6] [added: 7] | | | 20 | | | 7 | | | [removed: 63] [added: 67] | | |

| The Luxury Collection® (1) | | | Properties | | | [removed: 17] [added: 18] | | | [removed: 47] [added: 46] | | | 13 | | | [removed: 31] [added: 32] | | | 15 | | | [removed: 123] [added: 124] | | |

| St. Regis® | | | Properties | | | 10 | | | [removed: 6] [added: 5] | | | [removed: 9] [added: 11] | | | [removed: 21] [added: 23] | | | 4 | | | [removed: 50] [added: 53] | | |

| EDITION® | | | Properties | | | [removed: 4] [added: 5] | | | [removed: 3] [added: 4] | | | 3 | | | 3 | | | — | | | [removed: 13] [added: 15] | | |

| [removed: Marriott® Hotels] [added: Protea Hotels® by Marriott (Protea Hotels®)] | | | Properties | | | [removed: 340] [added: —] | | | [removed: 103] [added: 1] | | | [removed: 26] [added: 64] | | | [removed: 96] [added: —] | | | [removed: 29] [added: —] | | | [removed: 594] [added: 65] | | |

| Renaissance® Hotels | | | Properties | | | [removed: 85] [added: 89] | | | [removed: 31] [added: 27] | | | 5 | | | [removed: 43] [added: 44] | | | 9 | | | [removed: 173] [added: 174] | | |

| Le Méridien® | | | Properties | | | [removed: 24] [added: 25] | | | 16 | | | [removed: 21] [added: 23] | | | [removed: 47] [added: 49] | | | 2 | | | [removed: 110] [added: 115] | | |

| Autograph Collection® Hotels [removed: (2)] [added: (1)] | | | Properties | | | [removed: 136] [added: 146] | | | [removed: 58] [added: 68] | | | [removed: 8] [added: 13] | | | [removed: 16] [added: 19] | | | [removed: 35] [added: 36] | | | [removed: 253] [added: 282] | | |

| Delta Hotels by Marriott® (Delta Hotels®) | | | Properties | | | [removed: 82] [added: 87] | | | [removed: 6] [added: 30] | | | [removed: 3] [added: 5] | | | 2 | | | 1 | | | [removed: 94] [added: 125] | | |

| Marriott Executive Apartments® | | | Properties | | | — | | | 4 | | | [removed: 10] [added: 12] | | | 18 | | | 2 | | | [removed: 34] [added: 36] | | |

| Rooms | | | — | | | 361 | | | [removed: 1,326] [added: 1,665] | | | 2,742 | | | 240 | | | [removed: 4,669] [added: 5,008] | | | | | |

| Tribute Portfolio® [added: (1)] | | | Properties | | | [removed: 40] [added: 51] | | | [removed: 13] [added: 17] | | | [removed: 1] [added: 2] | | | [removed: 11] [added: 12] | | | [removed: 4] [added: 7] | | | [removed: 69] [added: 89] | | |

| Design [removed: HotelsTM] [added: Hotels®] | | | Properties | | | [removed: 9] [added: 10] | | | [removed: 7] [added: 26] | | | [removed: 3] [added: 6] | | | [removed: —] [added: 2] | | | [removed: —] [added: 6] | | | [removed: 19] [added: 50] | | |

| Courtyard by Marriott® (Courtyard®) | | | Properties | | | [removed: 1,038] [added: 1,050] | | | [removed: 76] [added: 74] | | | 10 | | | [removed: 89] [added: 99] | | | [removed: 43] [added: 47] | | | [removed: 1,256] [added: 1,280] | | |

| Residence Inn by Marriott® (Residence Inn®) | | | Properties | | | [removed: 846] [added: 849] | | | [removed: 17] [added: 21] | | | [removed: 6] [added: 7] | | | — | | | [removed: 7] [added: 8] | | | [removed: 876] [added: 885] | | |

| Fairfield by Marriott® (Fairfield®) | | | Properties | | | [removed: 1,112] [added: 1,141] | | | — | | | — | | | [removed: 78] [added: 96] | | | [removed: 14] [added: 16] | | | [removed: 1,204] [added: 1,253] | | |

| SpringHill Suites by Marriott® (SpringHill Suites®) | | | Properties | | | [removed: 512] [added: 532] | | | — | | | — | | | — | | | — | | | [removed: 512] [added: 532] | | |

| Four Points by Sheraton® (Four Points®) | | | Properties | | | [removed: 160] [added: 159] | | | 19 | | | [removed: 18] [added: 21] | | | [removed: 84] [added: 89] | | | [removed: 19] [added: 18] | | | [removed: 300] [added: 306] | | |

| TownePlace Suites by Marriott® (TownePlace Suites®) | | | Properties | | | [removed: 475] [added: 486] | | | — | | | — | | | — | | | — | | | [removed: 475] [added: 486] | | |

| Aloft® Hotels | | | Properties | | | [removed: 148] [added: 156] | | | 10 | | | 11 | | | 31 | | | [removed: 12] [added: 14] | | | [removed: 212] [added: 222] | | |

| [removed: AC Hotels by] Marriott® [added: Hotels] | | | Properties | | | [removed: 95] [added: 339] | | | [removed: 87] [added: 75] | | | [removed: 2] [added: 28] | | | [removed: 4] [added: 102] | | | [removed: 15] [added: 31] | | | [removed: 203] [added: 575] | | |

| [removed: Protea Hotels® by Marriott (Protea Hotels®)] [added: Element® Hotels] | | | Properties | | | [removed: —] [added: 82] | | | 1 | | | [removed: 66] [added: 6] | | | [removed: —] [added: 8] | | | — | | | [removed: 67] [added: 97] | | |

| [removed: Element®] [added: Moxy®] Hotels | | | Properties | | | [removed: 73] [added: 28] | | | [removed: 1] [added: 81] | | | [removed: 5] [added: —] | | | [removed: 8] [added: 13] | | | — | | | [removed: 87] [added: 122] | | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

Finally, we receive royalty fees under agreements for The Ritz-Carlton Yacht Collection®, which first set sail in 2022, combining the luxury lifestyle of The Ritz-Carlton with a yachting experience.

At year-end 2022, we had 113 branded residential communities (11,481 residential units), for which we typically manage the related homeowners’ associations.

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| JW Marriott® | | | Properties | | | 33 | | | 7 | | | 10 | | | 47 | | | 16 | | | 113 | | |

| Rooms | | | 18,796 | | | 2,387 | | | 4,247 | | | 17,009 | | | 4,296 | | | 46,735 | | | | | |

| Rooms | | | 12,508 | | | 2,689 | | | 3,988 | | | 9,192 | | | 2,007 | | | 30,384 | | | | | |

| Rooms | | | 7,295 | | | 1,734 | | | 2,317 | | | 5,514 | | | 1,752 | | | 18,612 | | | | | |

| Rooms | | | 5,484 | | | 6,616 | | | 2,493 | | | 8,268 | | | 1,542 | | | 24,403 | | | | | |

| Rooms | | | 1,977 | | | 668 | | | 3,049 | | | 5,530 | | | 569 | | | 11,793 | | | | | |

| Rooms | | | 1,379 | | | 726 | | | 638 | | | 852 | | | — | | | 3,595 | | | | | |

| Rooms | | | 132,960 | | | 21,454 | | | 8,726 | | | 33,992 | | | 8,311 | | | 205,443 | | | | | |

| Sheraton® | | | Properties | | | 172 | | | 50 | | | 33 | | | 146 | | | 29 | | | 430 | | |

| Rooms | | | 66,621 | | | 14,096 | | | 9,516 | | | 52,487 | | | 8,226 | | | 150,946 | | | | | |

| Westin® | | | Properties | | | 132 | | | 18 | | | 8 | | | 63 | | | 14 | | | 235 | | |

| Rooms | | | 53,756 | | | 5,968 | | | 2,030 | | | 19,450 | | | 3,955 | | | 85,159 | | | | | |

| Rooms | | | 28,998 | | | 6,307 | | | 1,476 | | | 14,791 | | | 2,745 | | | 54,317 | | | | | |

| Rooms | | | 5,705 | | | 5,154 | | | 6,848 | | | 12,486 | | | 271 | | | 30,464 | | | | | |

| Rooms | | | 29,678 | | | 8,482 | | | 2,344 | | | 4,455 | | | 12,158 | | | 57,117 | | | | | |

| Rooms | | | 20,893 | | | 5,134 | | | 1,284 | | | 978 | | | 117 | | | 28,406 | | | | | |

| Rooms | | | 7,952 | | | 1,741 | | | 344 | | | 1,859 | | | 640 | | | 12,536 | | | | | |

| Rooms | | | 1,385 | | | 2,123 | | | 619 | | | 581 | | | 146 | | | 4,854 | | | | | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| Rooms | | | 145,025 | | | 14,003 | | | 2,139 | | | 22,398 | | | 7,612 | | | 191,177 | | | | | |

| Rooms | | | 104,463 | | | 2,408 | | | 1,117 | | | — | | | 1,213 | | | 109,201 | | | | | |

| Rooms | | | 108,338 | | | — | | | — | | | 14,283 | | | 2,222 | | | 124,843 | | | | | |

| Rooms | | | 63,014 | | | — | | | — | | | — | | | — | | | 63,014 | | | | | |

| Rooms | | | 24,058 | | | 3,291 | | | 5,113 | | | 23,133 | | | 2,332 | | | 57,927 | | | | | |

| Rooms | | | 49,719 | | | — | | | — | | | — | | | — | | | 49,719 | | | | | |

| Rooms | | | 22,582 | | | 1,676 | | | 2,555 | | | 6,790 | | | 2,313 | | | 35,916 | | | | | |

| Rooms | | | 17,766 | | | 11,959 | | | 286 | | | 1,910 | | | 2,696 | | | 34,617 | | | | | |

| Rooms | | | — | | | 72 | | | 6,627 | | | — | | | — | | | 6,699 | | | | | |

| Rooms | | | 11,396 | | | 160 | | | 1,009 | | | 1,651 | | | — | | | 14,216 | | | | | |

| Rooms | | | 5,316 | | | 15,321 | | | — | | | 2,471 | | | — | | | 23,108 | | | | | |

| Rooms | | | 7,128 | | | 326 | | | 1,580 | | | 1,864 | | | 583 | | | 11,481 | | | | | |

| | | | Subtotal Properties | | | 5,846 | | | 721 | | | 327 | | | 980 | | | 320 | | | 8,194 | | |

| | | | Subtotal Rooms | | | 964,412 | | | 135,078 | | | 72,131 | | | 264,946 | | | 65,946 | | | 1,502,513 | | |

| Rooms | | | | | | | | | | | | | | | | | | 22,745 | | | | | |

| Yacht (2) | | | Properties | | | | | | | | | | | | | | | | | | 1 | | |

| Rooms | | | | | | | | | | | | | | | | | | 149 | | | | | |

*COVID-19*

COVID-19 has had an unprecedented impact on the travel industry and the Company, and it will continue to have a material negative impact on our future results for a period of time that we are currently unable to predict.

For further information about COVID-19’s impact to our business, see Part I, Item 1A, “Risk Factors,” and Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

This does not include branded residential communities for which we manage the related owners’ association.

At year-end 2021, we had 102 branded residential communities (9,878 rooms).

| Rooms | | | 19,155 | | | 2,169 | | | 4,039 | | | 15,846 | | | 3,847 | | | 45,056 | | | | | |

| Rooms | | | 11,839 | | | 2,835 | | | 3,763 | | | 9,222 | | | 2,372 | | | 30,031 | | | | | |

| Rooms | | | 7,041 | | | 1,354 | | | 1,989 | | | 5,514 | | | 1,752 | | | 17,650 | | | | | |

| Rooms | | | 5,285 | | | 6,999 | | | 2,643 | | | 7,983 | | | 1,252 | | | 24,162 | | | | | |

| Rooms | | | 1,968 | | | 883 | | | 2,755 | | | 5,044 | | | 568 | | | 11,218 | | | | | |

| Rooms | | | 1,207 | | | 432 | | | 638 | | | 852 | | | — | | | 3,129 | | | | | |

| Rooms | | | 132,791 | | | 26,719 | | | 7,968 | | | 32,119 | | | 7,789 | | | 207,386 | | | | | |

| Sheraton® | | | Properties | | | 178 | | | 57 | | | 33 | | | 139 | | | 30 | | | 437 | | |

| Rooms | | | 68,824 | | | 16,008 | | | 9,699 | | | 50,315 | | | 8,396 | | | 153,242 | | | | | |

| Westin® | | | Properties | | | 133 | | | 18 | | | 7 | | | 61 | | | 13 | | | 232 | | |

| Rooms | | | 54,009 | | | 5,973 | | | 1,838 | | | 18,478 | | | 3,813 | | | 84,111 | | | | | |

| Rooms | | | 28,091 | | | 7,262 | | | 1,293 | | | 14,733 | | | 2,745 | | | 54,124 | | | | | |

| Rooms | | | 5,287 | | | 5,156 | | | 6,124 | | | 12,446 | | | 271 | | | 29,284 | | | | | |

| Rooms | | | 27,807 | | | 7,298 | | | 1,629 | | | 3,706 | | | 11,154 | | | 51,594 | | | | | |

| Rooms | | | 19,312 | | | 1,078 | | | 718 | | | 978 | | | 117 | | | 22,203 | | | | | |

| Rooms | | | 6,554 | | | 1,398 | | | 249 | | | 1,708 | | | 193 | | | 10,102 | | | | | |

| Rooms | | | 1,313 | | | 796 | | | 266 | | | — | | | — | | | 2,375 | | | | | |

| Rooms | | | 143,376 | | | 14,484 | | | 2,162 | | | 20,314 | | | 7,063 | | | 187,399 | | | | | |

| Rooms | | | 104,167 | | | 1,975 | | | 983 | | | — | | | 982 | | | 108,107 | | | | | |

| Rooms | | | 105,330 | | | — | | | — | | | 11,970 | | | 1,971 | | | 119,271 | | | | | |

| Rooms | | | 60,617 | | | — | | | — | | | — | | | — | | | 60,617 | | | | | |

| Rooms | | | 24,146 | | | 3,070 | | | 4,500 | | | 22,040 | | | 2,513 | | | 56,269 | | | | | |

| Rooms | | | 48,595 | | | — | | | — | | | — | | | — | | | 48,595 | | | | | |

| Rooms | | | 21,507 | | | 1,676 | | | 2,559 | | | 6,816 | | | 1,971 | | | 34,529 | | | | | |

| Rooms | | | 15,692 | | | 11,508 | | | 286 | | | 1,296 | | | 2,383 | | | 31,165 | | | | | |

| Rooms | | | — | | | 72 | | | 6,783 | | | — | | | — | | | 6,855 | | | | | |

| Rooms | | | 10,016 | | | 160 | | | 731 | | | 1,651 | | | — | | | 12,558 | | | | | |

| Moxy® Hotels | | | Properties | | | 26 | | | 68 | | | — | | | 12 | | | — | | | 106 | | |

| Rooms | | | 4,913 | | | 12,897 | | | — | | | 2,266 | | | — | | | 20,076 | | | | | |

| Rooms | | | 6,925 | | | 234 | | | 461 | | | 1,700 | | | 558 | | | 9,878 | | | | | |

| | | | Subtotal Properties | | | 5,712 | | | 682 | | | 296 | | | 911 | | | 296 | | | 7,897 | | |

| | | | Subtotal Rooms | | | 945,987 | | | 133,019 | | | 65,523 | | | 249,999 | | | 61,950 | | | 1,456,478 | | |

| Rooms | | | | | | | | | | | | | | | | | | 22,701 | | | | | |

| Total Rooms | | | | | | | | | | | | | | | | | | 1,479,179 | | | | | |

(2)Includes five properties acquired when we purchased Elegant Hotels Group plc in December 2019, which we currently intend to re-brand under the Autograph Collection brand following the completion of planned renovations.

Within this section, we use a threshold of $1 million in disclosing material environmental proceedings involving a governmental [removed: authority.][added: authority, if any.]

In May 2020, we received a notice from the District Attorneys of the Counties of Placer, Riverside, San Francisco and San Mateo in California asserting that nine properties in California have failed to comply with certain state statutes regulating hazardous and other waste handling and disposal.

We are cooperating with the District Attorneys’ requests for information and have entered into a tolling agreement with the District Attorneys.

Management does not believe that the ultimate outcome of this matter will have a material adverse effect on the Company.

For the Fiscal Year Ended December 31, [removed: 2021][added: 2022]

[removed: ][added: ]

[removed: Registrant’s] [added: (Registrant’s] Telephone Number, Including Area [removed: Code] [added: Code)] (301) 380-3000

[added: |] Securities registered pursuant to Section 12(b) of the Act: [added: | | | | | | | | | | | | | | |]

The aggregate market value of shares of common stock held by non-affiliates at June 30, [removed: 2021,] [added: 2022,] was [removed: $37,430,276,528.][added: $37,283,265,895.]

There were [removed: 326,311,111] [added: 308,121,159] shares of Class A Common Stock, par value $0.01 per share, outstanding at February [removed: 8, 2022.][added: 7, 2023.]

Portions of the Proxy Statement prepared for the [removed: 2022] [added: 2023] Annual Meeting of Stockholders are incorporated by reference into Part III of this report.

FISCAL YEAR ENDED DECEMBER 31, [removed: 2021][added: 2022]

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Forward-looking statements include information related to [removed: the future effects on our business of the coronavirus pandemic (“COVID-19”);] Revenue per Available Room (“RevPAR”), [added: average daily rate (“ADR”),] occupancy and other future demand and recovery trends and expectations; our expectations regarding rooms growth; our expectations regarding [removed: the receipt of certain credits and refunds under certain U.S. federal legislation;] our [removed: expectations regarding our] ability to meet our liquidity requirements; our [removed: expectations regarding our cash from operations; our] capital expenditures and other investment spending expectations; our expectations regarding [removed: capital returns;] [added: future dividends] and [added: share repurchases; our expectations regarding our acquisition of the City Express brand and the addition of the City Express hotels to our franchise system; and] other statements that are preceded by, followed by, or include the words “believes,” “expects,” “anticipates,” “intends,” “plans,” “estimates,” “foresees,” or similar expressions; and similar statements concerning anticipated future events and expectations that are not historical facts.

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| 7750 Wisconsin Avenue | | | | | | Bethesda | | | | | | Maryland | | | | | | 20814 | | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| [Part I.](#i592a7d33419342abba73cf1f38db7c74_19) | | | | | | | | |

| [Part III.](#i592a7d33419342abba73cf1f38db7c74_280) | | | | | | | | |

| [Part IV.](#i592a7d33419342abba73cf1f38db7c74_292) | | | | | | | | |

| | | | [Signatures](#i592a7d33419342abba73cf1f38db7c74_301) | | | [70](#i592a7d33419342abba73cf1f38db7c74_301) | | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| 10400 Fernwood Road | | | | | | Bethesda | | | | | | Maryland | | | | | | 20817 | | |

| [Part I.](#ic355194fd9bc40199770bfde636735be_16) | | | | | | | | |

| [Part III.](#ic355194fd9bc40199770bfde636735be_253) | | | | | | | | |

| [Part IV.](#ic355194fd9bc40199770bfde636735be_265) | | | | | | | | |

| | | | [Signatures](#ic355194fd9bc40199770bfde636735be_277) | | | [79](#ic355194fd9bc40199770bfde636735be_277) | | |

[removed: We describe our company-operated properties in] [added: See] Part I, Item 1, “Business,” earlier in this report, and [removed: under] the “Properties and Rooms” caption in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results [added: of Operations” for more information about our company-operated properties.]

[removed: Most] [added: Additionally, most] of our regional offices, [added: customer care and] reservation centers, and sales offices, as well as our corporate headquarters, are in leased [removed: facilities, both domestically and internationally.][added: facilities.]

[removed: | *U.S.] [added: As of December 31, 2022, we owned or leased 26 hotels in U.S.] & Canada [removed: Owned Hotels* | | | | | | | | | | | | | | | | | | | | |][added: and 38 hotels in International.]

Under our asset-light business model, we typically manage or franchise hotels and other lodging offerings, rather than own them.

of Operations.” We believe our owned and leased properties are in generally good physical condition with the need for only routine repairs and maintenance and periodic capital improvements.

As of December 31, 2021, we owned or leased the following hotel properties:

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Properties | | | | | | | | | | | | Location | | | | | | Rooms | | |

| Courtyard Las Vegas Convention Center | | | | | | | | | | | | Las Vegas, NV | | | | | | 149 | | |

| Las Vegas Marriott | | | | | | | | | | | | Las Vegas, NV | | | | | | 278 | | |

| Residence Inn Las Vegas Convention Center | | | | | | | | | | | | Las Vegas, NV | | | | | | 192 | | |

| The Westin Peachtree Plaza, Atlanta | | | | | | | | | | | | Atlanta, GA | | | | | | 1,073 | | |

| W New York – Union Square | | | | | | | | | | | | New York, NY | | | | | | 270 | | |

| *U.S. & Canada Leased Hotels* | | | | | | | | | | | | | | | | | | | | |

| Albuquerque Airport Courtyard | | | | | | | | | | | | Albuquerque, NM | | | | | | 150 | | |

| Anaheim Marriott | | | | | | | | | | | | Anaheim, CA | | | | | | 1,030 | | |

| Baltimore BWI Airport Courtyard | | | | | | | | | | | | Linthicum, MD | | | | | | 149 | | |

| Baton Rouge Acadian Centre/LSU Area Courtyard | | | | | | | | | | | | Baton Rouge, LA | | | | | | 149 | | |

| Chicago O'Hare Courtyard | | | | | | | | | | | | Des Plaines, IL | | | | | | 180 | | |

| Des Moines West/Clive Courtyard | | | | | | | | | | | | Clive, IA | | | | | | 108 | | |

| Fort Worth University Drive Courtyard | | | | | | | | | | | | Fort Worth, TX | | | | | | 130 | | |

| Greensboro Courtyard | | | | | | | | | | | | Greensboro, NC | | | | | | 149 | | |

| Indianapolis Airport Courtyard | | | | | | | | | | | | Indianapolis, IN | | | | | | 151 | | |

| Irvine John Wayne Airport/Orange County Courtyard | | | | | | | | | | | | Irvine, CA | | | | | | 153 | | |

| Louisville East Courtyard | | | | | | | | | | | | Louisville, KY | | | | | | 151 | | |

| Mt. Laurel Courtyard | | | | | | | | | | | | Mt. Laurel, NJ | | | | | | 151 | | |

| Newark Liberty International Airport Courtyard | | | | | | | | | | | | Newark, NJ | | | | | | 146 | | |

| Orlando Airport Courtyard | | | | | | | | | | | | Orlando, FL | | | | | | 149 | | |

| Orlando International Drive/Convention Center Courtyard | | | | | | | | | | | | Orlando, FL | | | | | | 151 | | |

| Renaissance New York Times Square Hotel | | | | | | | | | | | | New York, NY | | | | | | 317 | | |

| Sacramento Airport Natomas Courtyard | | | | | | | | | | | | Sacramento, CA | | | | | | 149 | | |

| San Diego Sorrento Valley Courtyard | | | | | | | | | | | | San Diego, CA | | | | | | 149 | | |

| Spokane Downtown at the Convention Center Courtyard | | | | | | | | | | | | Spokane, WA | | | | | | 149 | | |

| St. Louis Downtown West Courtyard | | | | | | | | | | | | St. Louis, MO | | | | | | 151 | | |

| W New York – Times Square | | | | | | | | | | | | New York, NY | | | | | | 509 | | |

| *International Owned Hotels* | | | | | | | | | | | | | | | | | | | | |

| Courtyard by Marriott Aberdeen Airport | | | | | | | | | | | | Aberdeen, United Kingdom | | | | | | 194 | | |

| Courtyard by Marriott Rio de Janeiro Barra da Tijuca | | | | | | | | | | | | Barra da Tijuca, Brazil | | | | | | 264 | | |

| Courtyard by Marriott Toulouse Airport | | | | | | | | | | | | Toulouse, France | | | | | | 187 | | |

| Colony Club, Barbados | | | | | | | | | | | | Barbados | | | | | | 96 | | |

| Crystal Cove, Barbados | | | | | | | | | | | | Barbados | | | | | | 88 | | |

| Marriott Puerto Vallarta Resort & Spa | | | | | | | | | | | | Puerto Vallarta, Mexico | | | | | | 433 | | |

| Residence Inn Rio de Janeiro Barra da Tijuca | | | | | | | | | | | | Barra da Tijuca, Brazil | | | | | | 140 | | |

At February [removed: 8, 2022, 326,311,111] [added: 7, 2023, 308,121,159] shares of our Class A Common Stock (our “common stock”) were outstanding and were held by [removed: 33,148] [added: 32,128] stockholders of record.

Fourth Quarter [removed: 2021] [added: 2022] Issuer Purchases of Equity Securities

| *(in millions, except per share amounts)* | | | | | | | | | | | | | | | | | | | | | | | | [added: | | |]

| Period | | | [added: | | |] Total Number of Shares Purchased | | | | | | Average Price per Share | | | | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) | | | | | | Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs (1) | | |

At year-end [removed: 2021, 17.4] [added: 2022, 25.6] million shares remained available for repurchase under Board approved authorizations.

We repurchase shares in the open market and in privately negotiated [removed: transactions.][added: transactions and account for these shares as treasury stock.]

| | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| October 1, 2022 - October 31, 2022 | | | | | | 3.0 | | | | | | $ | 149.16 | | | | | 3.0 | | | | | | 6.3 | | |

| November 1, 2022 - November 30, 2022 | | | | | | 2.8 | | | | | | $ | 159.06 | | | | | 2.8 | | | | | | 28.5 | | |

| December 1, 2022 - December 31, 2022 | | | | | | 2.9 | | | | | | $ | 155.66 | | | | | 2.9 | | | | | | 25.6 | | |

In addition, on November 10, 2022, we announced that our Board of Directors further increased our common stock repurchase authorization by 25 million shares.

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| October 1, 2021-October 31, 2021 | | | — | | | | | | $ | — | | | | | — | | | | | | 17.4 | | |

| November 1, 2021-November 30, 2021 | | | — | | | | | | $ | — | | | | | — | | | | | | 17.4 | | |

| December 1, 2021-December 31, 2021 | | | — | | | | | | $ | — | | | | | — | | | | | | 17.4 | | |

We do not anticipate repurchasing additional shares until our leverage ratios further improve.

| [Management’s Report on Internal Control Over Financial [removed: Reporting](#ic355194fd9bc40199770bfde636735be_130)] [added: Reporting](#i592a7d33419342abba73cf1f38db7c74_151)] | | | [removed: [35](#ic355194fd9bc40199770bfde636735be_130)] [added: [31](#i592a7d33419342abba73cf1f38db7c74_151)] | | |

| [Report of Independent Registered Public Accounting [removed: Firm](#ic355194fd9bc40199770bfde636735be_133)] [added: Firm](#i592a7d33419342abba73cf1f38db7c74_154)] | | | [removed: [36](#ic355194fd9bc40199770bfde636735be_133)] [added: [32](#i592a7d33419342abba73cf1f38db7c74_154)] | | |

| [Report of Independent Registered Public Accounting [removed: Firm](#ic355194fd9bc40199770bfde636735be_136)] [added: Firm](#i592a7d33419342abba73cf1f38db7c74_160)] (PCAOB ID: 42) | | | [removed: [37](#ic355194fd9bc40199770bfde636735be_136)] [added: [33](#i592a7d33419342abba73cf1f38db7c74_160)] | | |

| [Consolidated Statements [removed: of](#ic355194fd9bc40199770bfde636735be_139) [Income](#ic355194fd9bc40199770bfde636735be_139) [(Loss)](#ic355194fd9bc40199770bfde636735be_139)] [added: of Income (Loss)](#i592a7d33419342abba73cf1f38db7c74_163)] | | | [removed: [40](#ic355194fd9bc40199770bfde636735be_139)] [added: [36](#i592a7d33419342abba73cf1f38db7c74_163)] | | |

| [Consolidated Statements of [removed: Comprehensive](#ic355194fd9bc40199770bfde636735be_142) [Income](#ic355194fd9bc40199770bfde636735be_142) [(Loss)](#ic355194fd9bc40199770bfde636735be_142)] [added: Comprehensive Income (Loss)](#i592a7d33419342abba73cf1f38db7c74_166)] | | | [removed: [41](#ic355194fd9bc40199770bfde636735be_142)] [added: [37](#i592a7d33419342abba73cf1f38db7c74_166)] | | |

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| [Consolidated Statements of Cash [removed: Flows](#ic355194fd9bc40199770bfde636735be_148)] [added: Flows](#i592a7d33419342abba73cf1f38db7c74_172)] | | | [removed: [43](#ic355194fd9bc40199770bfde636735be_148)] [added: [39](#i592a7d33419342abba73cf1f38db7c74_172)] | | |

| [Consolidated Statements of Stockholders’ [removed: Equity](#ic355194fd9bc40199770bfde636735be_151)] [added: Equity](#i592a7d33419342abba73cf1f38db7c74_175)] | | | [removed: [44](#ic355194fd9bc40199770bfde636735be_151)] [added: [40](#i592a7d33419342abba73cf1f38db7c74_175)] | | |

| [Notes to Consolidated Financial [removed: Statements](#ic355194fd9bc40199770bfde636735be_154)] [added: Statements](#i592a7d33419342abba73cf1f38db7c74_178)] | | | [removed: [45](#ic355194fd9bc40199770bfde636735be_154)] [added: [41](#i592a7d33419342abba73cf1f38db7c74_178)] | | |

| [Summary of Significant Accounting [removed: Policies](#ic355194fd9bc40199770bfde636735be_160)] [added: Policies](#i592a7d33419342abba73cf1f38db7c74_184)] | | | [removed: [45](#ic355194fd9bc40199770bfde636735be_160)] [added: [41](#i592a7d33419342abba73cf1f38db7c74_184)] | | |

| [Earnings Per [removed: Share](#ic355194fd9bc40199770bfde636735be_172)] [added: Share](#i592a7d33419342abba73cf1f38db7c74_196)] | | | [removed: [53](#ic355194fd9bc40199770bfde636735be_172)] [added: [49](#i592a7d33419342abba73cf1f38db7c74_196)] | | |

| [Stock-Based [removed: Compensation](#ic355194fd9bc40199770bfde636735be_178)] [added: Compensation](#i592a7d33419342abba73cf1f38db7c74_202)] | | | [removed: [54](#ic355194fd9bc40199770bfde636735be_178)] [added: [49](#i592a7d33419342abba73cf1f38db7c74_202)] | | |

| [Commitments and [removed: Contingencies](#ic355194fd9bc40199770bfde636735be_187)] [added: Contingencies](#i592a7d33419342abba73cf1f38db7c74_211)] | | | [removed: [57](#ic355194fd9bc40199770bfde636735be_187)] [added: [52](#i592a7d33419342abba73cf1f38db7c74_211)] | | |

| [Long-Term [removed: Debt](#ic355194fd9bc40199770bfde636735be_196)] [added: Debt](#i592a7d33419342abba73cf1f38db7c74_217)] | | | [removed: [62](#ic355194fd9bc40199770bfde636735be_196)] [added: [56](#i592a7d33419342abba73cf1f38db7c74_217)] | | |

| [Intangible Assets and [removed: Goodwill](#ic355194fd9bc40199770bfde636735be_205)] [added: Goodwill](#i592a7d33419342abba73cf1f38db7c74_226)] | | | [removed: [64](#ic355194fd9bc40199770bfde636735be_205)] [added: [57](#i592a7d33419342abba73cf1f38db7c74_226)] | | |

| [removed: [Property] [added: Property] and [removed: Equipment](#ic355194fd9bc40199770bfde636735be_211)] [added: equipment] | | | [removed: [64](#ic355194fd9bc40199770bfde636735be_211)] [added: (58)] | | | [added: | | | (9) | | |]

| [Fair Value of Financial [removed: Instruments](#ic355194fd9bc40199770bfde636735be_220)] [added: Instruments](#i592a7d33419342abba73cf1f38db7c74_241)] | | | [removed: [65](#ic355194fd9bc40199770bfde636735be_220)] [added: [58](#i592a7d33419342abba73cf1f38db7c74_241)] | | |

| [Accumulated Other Comprehensive [removed: Loss](#ic355194fd9bc40199770bfde636735be_223)] [added: Loss](#i592a7d33419342abba73cf1f38db7c74_244)] | | | [removed: [66](#ic355194fd9bc40199770bfde636735be_223)] [added: [59](#i592a7d33419342abba73cf1f38db7c74_244)] | | |

| [Related Party [removed: Transactions](#ic355194fd9bc40199770bfde636735be_232)] [added: Transactions](#i592a7d33419342abba73cf1f38db7c74_256)] | | | [removed: [67](#ic355194fd9bc40199770bfde636735be_232)] [added: [60](#i592a7d33419342abba73cf1f38db7c74_256)] | | |

In connection with the preparation of the Company’s annual consolidated financial statements, management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in the Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) (the “COSO criteria”).

Based on this assessment, management has concluded that, applying the COSO criteria, as of December 31, [removed: 2021,] [added: 2022,] the Company’s internal control over financial reporting was effective to provide reasonable assurance of the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

We have audited Marriott International, Inc.’s internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) (the COSO criteria).

In our opinion, Marriott International, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] and the related consolidated statements of income (loss), comprehensive income (loss), stockholders’ equity and cash flows for each of the three [removed: fiscal] years in the period ended December 31, [removed: 2021,] [added: 2022,] and the related notes, and our report dated February [removed: 15, 2022] [added: 14, 2023] expressed an unqualified opinion thereon.

We have audited the accompanying consolidated balance sheets of Marriott International, Inc. (the Company) as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] the related consolidated statements of income (loss), comprehensive income (loss), stockholders’ equity and cash flows for each of the three [removed: fiscal] years in the period ended December 31, [removed: 2021,] [added: 2022,] and the related notes (collectively referred to as the [removed: “financial] [added: “consolidated financial] statements”).

In our opinion, the [added: consolidated] financial statements present fairly, in all material respects, the financial position of the Company at December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2021,] [added: 2022,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) and our report dated February [removed: 15, 2022] [added: 14, 2023] expressed an unqualified opinion thereon.

| *Description of the Matter* | | | | | | During [removed: 2021] [added: 2022] the Company recognized [removed: $1,966] [added: $2,692] million of revenues previously deferred as of December 31, [removed: 2020] [added: 2021,] and had deferred revenue of [removed: $6,471] [added: $6,594] million as of December 31, [removed: 2021] [added: 2022] associated with the Marriott Bonvoy guest loyalty program (the “Loyalty Program”). As discussed in Note 2 to the financial statements, the Company recognizes revenue for performance obligations relating to Loyalty Program points and free night certificates as they are redeemed and the related performance obligations are satisfied. The Company recognizes a portion of revenue for the Licensed IP performance obligation under the sales-based royalty criteria, with the remaining portion recognized on a straight-line basis over the contract term. Revenue is recognized utilizing complex models based upon the estimated standalone selling price per point and per free night certificate, which includes judgment in making the estimates of variable consideration and breakage of points. | | |

| | | | | | | Auditing Loyalty Program results is complex due to: (1) the complexity of models and high volume of data used to monitor and account for Loyalty Program results, [removed: and] (2) the complexity [added: in accounting for the amendments to the Company’s domestic co-branded credit card agreements, as well as the judgment in estimating the relative standalone selling price of the related performance obligations,] and [added: (3) the complexity and] judgment of estimating the standalone selling price per Loyalty Program point, including both the estimate of variable consideration under the Company’s [removed: co-brand] [added: co-branded] credit card agreements which has significant estimation uncertainty associated with projecting future cardholder spending and redemption activity, and the estimated breakage of Loyalty Program points which requires the use of specialists. | | |

| | | | | | | To test the recognition of revenues and costs associated with the Loyalty Program, we performed audit procedures that included, among others, testing the clerical accuracy and consistency with US GAAP of the accounting model developed by the Company to recognize revenue and costs associated with the Loyalty Program, and testing significant inputs into the accounting model, including the estimated standalone selling price and recognition of points earned and redeemed during the period. We involved our [added: valuation specialists to assist in our testing procedures with respect to the estimate of relative standalone selling price of the performance obligations associated with the amendments to the domestic co-branded credit card agreements. We involved our] actuarial professionals to assist in our testing procedures with respect to the estimate of the breakage of Loyalty Program points. We evaluated management’s methodology for estimating the breakage of Loyalty Program points, and we tested underlying data and actuarial assumptions used in estimating the breakage. We evaluated the reasonableness of management’s assumptions, including projections of cash flows, used to estimate variable consideration under the Company’s [removed: co-brand] [added: co-branded] credit cards. | | |

| *Description of the Matter* | | | | | | During [removed: 2021] [added: 2022] the Company recognized [removed: $823] [added: $891] million of general and administrative expenses and [removed: $10,322] [added: $15,141] million of reimbursed expenses. As discussed in Note 2 to the financial statements, the Company incurs certain expenses that are for the benefit of, and reimbursable from, hotel owners and franchisees. Such amounts are recorded in the period in which the expense is incurred and include judgment with respect to the allocation of certain costs between general and administrative expenses, which are non-reimbursable, and reimbursed expenses. | | |

Fiscal Years [added: 2022,] 2021, [removed: 2020,] and [removed: 2019][added: 2020]

| | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | |

| Base management fees | | | $ | [removed: 669] [added: 1,044] | | | | | $ | [removed: 443] [added: 669] | | | | | $ | [removed: 1,180] [added: 443] | |

| Franchise fees | | | [removed: 1,790] [added: 2,505] | | | | | | [removed: 1,153] [added: 1,790] | | | | | | [removed: 2,006] [added: 1,153] | | |

| Incentive management fees | | | [removed: 235] [added: 529] | | | | | | [removed: 87] [added: 235] | | | | | | [removed: 637] [added: 87] | | |

| Gross fee revenues | | | [removed: 2,694] [added: 4,078] | | | | | | [removed: 1,683] [added: 2,694] | | | | | | [removed: 3,823] [added: 1,683] | | |

| Contract investment amortization | | | [removed: (75)] [added: (89)] | | | | | | [removed: (132)] [added: (75)] | | | | | | [removed: (62)] [added: (132)] | | |

| Net fee revenues | | | [removed: 2,619] [added: 3,989] | | | | | | [removed: 1,551] [added: 2,619] | | | | | | [removed: 3,761] [added: 1,551] | | |

| Owned, leased, and other revenue | | | [removed: 796] [added: 1,367] | | | | | | [removed: 568] [added: 796] | | | | | | [removed: 1,612] [added: 568] | | |

| [Basis of Presentation](#i592a7d33419342abba73cf1f38db7c74_181) | | | [41](#i592a7d33419342abba73cf1f38db7c74_181) | | |

| [Acquisition](#i592a7d33419342abba73cf1f38db7c74_190) | | | [48](#i592a7d33419342abba73cf1f38db7c74_190) | | |

| [Income Taxes](#i592a7d33419342abba73cf1f38db7c74_208) | | | [50](#i592a7d33419342abba73cf1f38db7c74_208) | | |

| [Leases](#i592a7d33419342abba73cf1f38db7c74_214) | | | [54](#i592a7d33419342abba73cf1f38db7c74_214) | | |

| [Business Segments](#i592a7d33419342abba73cf1f38db7c74_250) | | | [59](#i592a7d33419342abba73cf1f38db7c74_250) | | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

February 14, 2023

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

February 14, 2023

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

Fiscal Years-Ended 2022 and 2021

| | | | 3,313 | | | | | | 3,626 | | |

| | | | 17,619 | | | | | | 17,999 | | |

| | | | $ | 24,815 | | | | | $ | 25,553 | |

| | | | 7,339 | | | | | | 6,407 | | |

| | | | 568 | | | | | | 1,414 | | |

| | | | $ | 24,815 | | | | | $ | 25,553 | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

Fiscal Years 2022, 2021, and 2020

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

Fiscal Years 2022, 2021, and 2020

| 310.6 | | | (1) | | | Balance at December 31, 2022 | | | $ | 568 | | | | | $ | 5 | | | | | $ | 5,965 | | | | | $ | 12,342 | | | | | $ | (17,015) | | | | | $ | (729) | |

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

When we recognize an

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

Measurements.” We base our calculation of the estimated fair value of a guarantee on the income approach or the market approach, depending on the type of guarantee.

ACQUISITION

In the 2022 fourth quarter, we announced that we reached an agreement with Hoteles City Express, S.A.B. de C.V. to acquire the City Express brand portfolio for $100 million.

As of October 19, 2022, the portfolio included 152 mid-scale hotels (17,356 rooms) located in Mexico, Costa Rica, Colombia, and Chile.

| [Basis of Presentation](#ic355194fd9bc40199770bfde636735be_157) | | | [45](#ic355194fd9bc40199770bfde636735be_157) | | |

| [Restructuring Charges](#ic355194fd9bc40199770bfde636735be_163) | | | [53](#ic355194fd9bc40199770bfde636735be_163) | | |

| [Income Taxes](#ic355194fd9bc40199770bfde636735be_184) | | | [54](#ic355194fd9bc40199770bfde636735be_184) | | |

| [Leases](#ic355194fd9bc40199770bfde636735be_190) | | | [60](#ic355194fd9bc40199770bfde636735be_190) | | |

| [Business Segments](#ic355194fd9bc40199770bfde636735be_229) | | | [66](#ic355194fd9bc40199770bfde636735be_229) | | |

| [Relationship with Major Customer](#ic355194fd9bc40199770bfde636735be_235) | | | [68](#ic355194fd9bc40199770bfde636735be_235) | | |

February 15, 2022

| | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | 3,626 | | | | | | 2,825 | | |

| | | | 17,999 | | | | | | 18,164 | | |

| | | | $ | 25,553 | | | | | $ | 24,701 | |

| | | | 6,407 | | | | | | 5,752 | | |

| | | | 1,414 | | | | | | 430 | | |

| (Gain) loss on asset dispositions | | | (3) | | | | | | 3 | | | | | | (147) | | |

| 339.1 | | | | | | Balance at December 31, 2018 | | | $ | 2,225 | | | | | $ | 5 | | | | | $ | 5,814 | | | | | $ | 8,982 | | | | | $ | (12,185) | | | | | $ | (391) | |

| — | | | | | | Adoption of ASU 2016-02 | | | 1 | | | | | | — | | | | | | — | | | | | | 1 | | | | | | — | | | | | | — | | |

The uncertainty created by the coronavirus pandemic and efforts to contain it (“COVID-19”) has made such estimates more difficult and subjective.

We recognize all other Loyalty Program costs as incurred in our “Reimbursed expenses” caption.

Our current deferred revenue, which we present in the “Accrued expenses and other” caption of our Balance Sheets, was $346 million at year-end 2021 and $325 million at year-end 2020.

expected future investments to grow new units; and estimated discount rates.

See Note 8 for additional information.

RESTRUCTURING CHARGES

Beginning in the 2020 second quarter, we initiated several regional restructuring plans to achieve cost savings in response to the decline in lodging demand caused by COVID-19.

We substantially completed our above-property programs as of December 31, 2020 and our property-level programs as of September 30, 2021.

The following table presents our restructuring liability activity during the period:

| *($ in millions)* | | | Employee termination benefits | | | | | | | | | | | | | | |

| Balance at December 31, 2020 | | | $ | 143 | | | | | | | | | | | | | |

| Charges | | | — | | | | | | | | | | | | | | |

| Cash payments | | | (122) | | | | | | | | | | | | | | |

| Balance at December 31, 2021, classified in “Accrued expenses and other” | | | $ | 15 | | | | | | | | | | | | | |

In the 2020 third quarter, as part of our effort to encourage associate retention in response to the severe impact of COVID-19 on our industry and the Company, we accelerated the issuance of RSU awards to certain officers and employees that ordinarily would have been made in the 2021 first quarter, and those units generally vest over four years and five months, with one quarter of the units vesting one year and five months after the grant date and the remaining units vesting in equal annual installments thereafter.

We did not accelerate the issuance of awards for our most senior executives.

| Outstanding at year-end 2020 | | | 5.8 | | | | | | $ | 107 | |

| Granted | | | 0.5 | | | | | | $ | 141 | |

| Distributed | | | (1.7) | | | | | | $ | 113 | |

| | | | | | | 37 | | | | | | (110) | | | | | | (490) | | |

| | | | | | | $ | (81) | | | | | $ | 199 | | | | | $ | (326) | |

You should note that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, [added: and we cannot assure you that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.]

We made no changes in internal control over financial reporting during the fourth quarter of [removed: 2021] [added: 2022] that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

and we cannot assure you that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

[Table](#i592a7d33419342abba73cf1f38db7c74_10) [of Contents](#i592a7d33419342abba73cf1f38db7c74_10)

As described below, we incorporate by reference in this Annual Report on Form 10-K certain information appearing in the Proxy Statement that we will furnish to our stockholders for our [removed: 2022] [added: 2023] Annual Meeting of Stockholders.

This information is as of February [removed: 1, 2022,] [added: 10, 2023,] except where indicated.

| Anthony G. [added: (Tony)] Capuano Chief Executive Officer | | | | | | [removed: 56] [added: 57] | | | | | | [removed: Anthony G.] [added: Tony] Capuano was appointed Chief Executive Officer (“CEO”) effective February 21, 2021. [added: Effective February 24, 2023, Mr. Capuano will become President and Chief Executive Officer.] Prior to his appointment as CEO, Mr. Capuano was Group President, Global Development, Design and Operations Services, a role he assumed in January 2020. In that role, he was responsible for leading the Company’s global development and design efforts and overseeing the Company’s Global Operations discipline. Mr. Capuano began his Marriott career in 1995 as part of the Market Planning and Feasibility team. Between 1997 and 2005, he led Marriott’s full-service development efforts in the Western U.S. and Canada. From 2005 to 2008, Mr. Capuano served as Senior Vice President of full-service development for North America. In 2008, his responsibilities expanded to include all of U.S. and Canada and the Caribbean and Latin America, and he became Executive Vice President and Global Chief Development Officer in 2009. Mr. Capuano began his professional career in Laventhol and Horwath’s Boston-based Leisure Time Advisory Group. He then joined Kenneth Leventhal and Company’s hospitality consulting group in Los Angeles, CA. Mr. Capuano earned his bachelor’s degree in Hotel Administration from Cornell University. He is an active member of the Cornell Hotel Society and a member of The Cornell School of Hotel Administration Dean’s Advisory [removed: Board. Mr. Capuano is also a member of] [added: Board, as well as] the [added: Business Roundtable, and the] American Hotel and Lodging Association’s [removed: Industry Real Estate Financial Advisory] [added: IREFAC] Council. [added: Additionally, Mr. Capuano serves on the Board of Directors of McDonald’s Corporation and Save Venice, a nonprofit organization dedicated to preserving the artistic heritage of Venice, Italy.] | | |

| [removed: Ty] [added: Benjamin T. (Ty)] Breland Executive Vice President and Chief Human Resources Officer | | | | | | [removed: 46] [added: 47] | | | | | | Ty Breland was appointed Executive Vice President and Chief Human Resources Officer effective October 29, 2021. Prior to that appointment, Mr. Breland served as Global HR Officer for Talent Development & Organizational Capability, a role he assumed in 2016. In that role, Mr. Breland had executive oversight for talent management, including leadership development, organizational capability, and change management. Mr. Breland also oversaw The Ritz-Carlton Leadership Center, including its business strategy and sales efforts, and served as the senior Human Resources leader for the company’s Global Development, Design & Operations Services disciplines. Mr. Breland joined Marriott in 2004 as a member of the Company’s Talent Management and Analytics group and held a variety of other senior human resources leadership positions, including Global HR Integration Officer, responsible for the Human Resources integration for Marriott’s merger with Starwood Hotels & Resorts. From 2011-2015, Mr. Breland served as Regional Vice President of Human Resources for the Eastern Region of the U.S. Before joining Marriott, Mr. Breland worked for the Human Resources Research Organization as a research consultant. He earned his Bachelor of Science in Psychology and Ph.D. in Industrial/Organizational Psychology from Virginia Tech, where he is a board member for the Virginia Tech Hospitality Business School. | | |

| [removed: Liam] [added: William P. (Liam)] Brown Group President, United States and Canada | | | | | | [removed: 61] [added: 62] | | | | | | Liam Brown [removed: became] [added: was appointed] Group President, United States and Canada effective [removed: in] January [added: 1,] 2021. Prior to this role, Mr. Brown served as the President and Managing Director of Europe from 2018 to 2019, followed by Group President of Europe, Middle East & Africa in 2020. Mr. Brown joined Marriott in 1989 and served as President for Franchising, Owner Services and Managed by Marriott Select Brands, North America from 2012 to 2018. Other key positions held by Mr. Brown include Chief Operations Officer for the Americas for Select Service & Extended Stay Lodging and Owner & Franchise Services, as well as Senior Vice President and Executive Vice President of Development for Marriott’s Select Service & Extended Stay lodging products. Mr. Brown also serves on the Board of Directors of the American Hotel and Lodging Association. He holds a Hotel Diploma and Business Degree from the Dublin Institute of Technology, Trinity College and earned his Master of Business Administration from the Robert H. Smith School of Management at the University of Maryland. | | |

| Felitia [added: O.] Lee Controller and Chief Accounting Officer | | | | | | [removed: 60] [added: 61] | | | | | | Felitia Lee [removed: became] [added: was appointed] Marriott’s Controller and Chief Accounting Officer and principal accounting officer [removed: in] [added: effective] August [added: 28,] 2020, with responsibility for the accounting operations of the Company including oversight of [removed: Financial Reporting & Analysis, Accounting Policy, General Accounting, Governance, Risk Management (Insurance, Claims, Business Continuity, Fire] [added: financial reporting] & [removed: Life Safety), Global Finance Shared Services,] [added: analysis, accounting policy, general accounting, finance] and [removed: Finance Contract Compliance.] [added: accounting governance, global finance shared services, and financial contract compliance.] Ms. Lee joined Marriott in May 2020, supporting the management of the Company’s accounting operations. Prior to joining Marriott, Ms. Lee was the Senior Vice President and Controller for Kohl’s Corporation, a publicly-traded retailer, since 2018, where she was responsible for financial reporting, Sarbanes-Oxley processes, capital management, tax [removed: planning] [added: planning,] and compliance. Prior to joining Kohl’s Corporation, Ms. Lee held numerous positions with PepsiCo, Inc., a publicly-traded global food and beverage company, culminating in Vice President and Controller of the Pepsi Beverage Company after the merger of PepsiCo with two of its largest bottlers in 2010. Earlier in her career, Ms. Lee held a variety of financial leadership positions with such organizations as Pilkington, plc and Coopers & Lybrand (an accounting firm now part of PricewaterhouseCoopers). She earned her Bachelor of Science in Accounting from Santa Clara University. She is a Certified Public Accountant and a member of the American Institute of Certified Public Accountants. | | |

| Stephanie [added: C.] Linnartz President | | | | | | [removed: 53] [added: 54] | | | | | | Stephanie Linnartz was appointed President of Marriott effective February 22, 2021. In her role, she is responsible for developing and executing all aspects of the Company’s global consumer strategy, including brand, marketing, sales, revenue management, customer engagement, technology, emerging businesses, and Marriott Bonvoy, the Company’s loyalty program. In addition, she oversees Marriott’s global development, design, and operations services functions. Before that, Ms. Linnartz was Group President, Consumer Operations, Technology and Emerging Businesses beginning in January 2020. Before assuming her position as Group President, Ms. Linnartz, who began her Marriott career in 1997, served as Global Chief Commercial Officer from 2013 to 2019; Global Officer, Sales and Revenue Management from 2009 to 2013; Senior Vice President, Global Sales from 2008 to 2009; Senior Vice President, Sales and Marketing Planning and Support from 2005 to 2008; and prior to that, various roles in Marriott’s Finance and Business Development Department. She currently serves on the Board of Directors of The Home Depot. She holds a bachelor’s degree in Political Science and Government from the College of the Holy Cross, where she sits on the Board of Trustees, and earned her Master of Business Administration from the College of William and Mary. [added: Ms. Linnartz was appointed President and CEO of Under Armour, Inc. in December 2022 and will leave Marriott effective February 24, 2023.] | | |

| Kathleen K. [added: (Leeny)] Oberg Chief Financial Officer and Executive Vice President, Business Operations | | | | | | [removed: 61] [added: 62] | | | | | | [removed: Kathleen (“Leeny”) K.] [added: Leeny] Oberg was appointed [removed: as Marriott’s] Executive Vice President and Chief Financial Officer effective January 1, 2016 and was additionally designated Executive Vice President, Business Operations [removed: beginning] [added: in] October 2021. Previously, Ms. Oberg was the Chief Financial Officer for The Ritz-Carlton since 2013, where she contributed significantly to the brand’s performance, growth, and organizational effectiveness. Prior to assuming that role, Ms. Oberg served in a range of financial leadership positions with [removed: Marriott. From 2008 to 2013, she was the Company’s] [added: Marriott, including] Senior Vice President, Corporate and Development [removed: Finance, where she led a team that valued new hotel development projects and merger and acquisition opportunities, prepared the Company’s long-range plans and annual budgets, and made recommendations for the Company’s financial] [added: Finance] and [removed: capital allocation strategy. From 2006 to 2008, Ms. Oberg served in London as] Senior Vice President, International Project Finance and Asset Management for Europe and the Middle East and [removed: Africa, and as the region’s senior finance executive.] [added: Africa.] Ms. Oberg first joined Marriott as part of its Investor Relations group in 1999. Before joining Marriott, Ms. Oberg held a variety of financial leadership positions with such organizations as Sodexo (previously Sodexo Marriott Services), Sallie Mae, Goldman Sachs, and Chase Manhattan Bank. [removed: She] [added: Ms. Oberg is an active member of the American Hotel and Lodging Association’s IREFAC Council, and she] currently serves on the [removed: Adobe] Board of [removed: Directors.] [added: Directors of Adobe Inc.] She earned her Bachelor of Science in Commerce, with concentrations in Finance and Management Information Systems from the University of Virginia, McIntire School of Commerce and received her Master of Business Administration from Stanford University Graduate School of Business. | | |