Annual report pursuant to Section 13 and 15(d)

Segment Information

v3.24.0.1
Segment Information
 12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
Segment Information
16. SEGMENT INFORMATION
The reportable segments presented below represent the Company’s operating segments for which separate financial information is available and is utilized on a regular basis by its chief operating decision maker to assess performance and allocate resources. In identifying its reportable segments, the Company also considers the nature of services provided by its operating segments. Management evaluates the operating results of each of its reportable segments based upon net revenues and “adjusted EBITDA”, which is defined as net income/(loss) excluding net interest expense, depreciation and amortization, early extinguishment of debt charges, impairment charges, restructuring and related charges, contract termination costs, separation-related items, transaction-related items (acquisition-, disposition-, or debt-related), (gain)/loss on asset sales, foreign currency impacts of highly inflationary countries, stock-based compensation expense, income taxes and development advance notes amortization. The Company believes that adjusted EBITDA is a useful measure of performance for its segments which, when considered with U.S. GAAP measures, allows a more complete understanding of its operating performance. The Company uses this measure internally to assess operating performance, both absolutely and in comparison to other companies, and to make day to day operating decisions, including in the evaluation of selected compensation decisions. The Company’s presentation of adjusted EBITDA may not be comparable to similarly titled measures used by other companies.
In the first quarter of 2023, the Company changed the composition of its reportable segments to reflect the recent changes in its Hotel Management segment due to the exit from the select-service management business, the sale of its two owned hotels and the exit from substantially all of its U.S. full-service management business. The remaining hotel management business, which is predominately the full-service international managed business, no longer meets the quantitative thresholds to be considered a reportable segment and as a result, the Company has aggregated, on a prospective basis, such management business within its Hotel Franchising segment.
Hotel Franchising
Hotel Management
Corporate and Other (a)
Total
Year Ended or as of December 31, 2023
Net revenues
 $ 1,397  n/a $ —  $ 1,397 
Adjusted EBITDA
 727  n/a (68) 659 
Depreciation and amortization
 66  n/a 10  76 
Segment assets
 3,880  n/a 153  4,033 
Capital expenditures
 33  n/a 4  37 
Year Ended or as of December 31, 2022
Net revenues
 $ 1,277  $ 221  $ —  $ 1,498 
Adjusted EBITDA
 679  37  (66) 650 
Depreciation and amortization
 63  5  9  77 
Segment assets
 3,711  113  299  4,123 
Capital expenditures
 33  —  6  39 
Year Ended or as of December 31, 2021
Net revenues
 $ 1,099  $ 466  $ —  $ 1,565 
Adjusted EBITDA
 592  57  (59) 590 
Depreciation and amortization
 60  26  9  95 
Segment assets
 3,575  394  300  4,269 
Capital expenditures
 30  4  3  37 
_____________________
(a)    Includes the elimination of transactions between segments.
Provided below is a reconciliation of net income to adjusted EBITDA.
Year Ended December 31,
2023 2022 2021
Net income $ 289  $ 355  $ 244 
Provision for income taxes 109  121  91 
Depreciation and amortization 76  77  95 
Interest expense, net 102  80  93 
Early extinguishment of debt 3  2  18 
Stock-based compensation expense 39  33  28 
Development advance notes amortization 15  12  11 
Transaction-related expenses, net 11  —  — 
Separation-related expenses 1  1  3 
Gain on asset sale, net —  (35) — 
Impairments, net —  —  6 
Foreign currency impact of highly inflationary countries 14  4  1 
Adjusted EBITDA
 $ 659  $ 650  $ 590 
The geographic segment information provided below is classified based on the geographic location of the Company’s subsidiaries.
United States
All Other Countries (a)
Total
Year Ended or As of December 31, 2023
Net revenues $ 1,142  $ 255  $ 1,397 
Net long-lived assets 3,002  190  3,192 
Year Ended or As of December 31, 2022
Net revenues $ 1,271  $ 227  $ 1,498 
Net long-lived assets 3,126  104  3,230 
Year Ended or As of December 31, 2021
Net revenues $ 1,366  $ 199  $ 1,565 
Net long-lived assets 3,199  107  3,306 
_____________________
(a)    Includes U.S. territories.