Annual report [Section 13 and 15(d), not S-K Item 405]

Franchising, Marketing and Reservation Activities (Tables)

v3.25.4
Franchising, Marketing and Reservation Activities (Tables)
12 Months Ended
Dec. 31, 2025
Franchisors [Abstract]  
Schedule of Franchisor Disclosure [Table Text Block]
Consolidated Balance Sheets:
As of December 31,
2025 2024
Other non-current assets
$ 343  $ 308 
The Company made a non-cash reclass of $11 million and $10 million during 2025 and 2024, respectively, from loan receivables to development advance notes, both of which were reported within other non-current assets.
The Company performs a qualitative assessment on its development advance notes quarterly to determine whether a triggering event has occurred which may indicate the asset is impaired. If such is indicated, the Company performs a quantitative assessment, which compares the carrying value of the development advance notes to the consideration (in the form of royalties and marketing fees) that the Company expects to receive in the future. As applicable, the Company also estimates the recovery value of the underlying collateral using a discounted cash flow model, which may include the assistance of a third-party valuation firm. This may require significant judgments, including estimation of future cash flows, which are dependent on discount rates and to a lesser extent, estimation of long-term rates of growth. As a result of these evaluations, the Company recorded an impairment charge of $48 million and $10 million during 2025 and 2024, respectively. See Note 16 - Other Expenses and Charges for more details.

Consolidated Statements of Income:
Year Ended December 31,
2025 2024 2023
Forgiveness of notes (a)
$ 32  $ 24  $ 15 
Impairment (b)
48  10  — 
Bad debt expense related to notes — 
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(a)    Amounts are primarily recorded as a reduction of royalties and franchise fees and marketing, reservation and loyalty revenues on the Consolidated Statements of Income.
(b)    Amount is recorded within impairment on the Consolidated Statements of Income.