Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.20.2
Segment Information
 9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Segment Information
13. 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 interest expense, depreciation and amortization, impairment charges, restructuring and related charges, contract termination costs, transaction-related items (acquisition-, disposition- or separation-related), foreign currency impacts of highly inflationary countries, stock-based compensation expense and income taxes. Wyndham Hotels 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 these measures 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.
Three Months Ended September 30,
2020 2019
Net Revenues
Adjusted EBITDA
Net Revenues
Adjusted EBITDA
Hotel Franchising
 $ 236  $ 117  $ 379  $ 195 
Hotel Management
 101  2  180  13 
Total Reportable Segments
 337  119  559  208 
Corporate and Other
 —  (18) 1  (18)
Total Company
 $ 337  $ 101  $ 560  $ 190 
The table below is a reconciliation of net income to adjusted EBITDA.
Three Months Ended September 30,
2020 2019
Net income $ 27  $ 45 
Provision for income taxes 15  21 
Depreciation and amortization 24  26 
Interest expense, net 29  25 
Stock-based compensation expense 5  4 
Transaction-related expenses, net —  12 
Contract termination costs —  34 
Transaction-related item —  20 
Foreign currency impact of highly inflationary countries
 1  3 
Adjusted EBITDA
 $ 101  $ 190 

Nine Months Ended September 30, 2020
2020 2019
Net Revenues
Adjusted EBITDA
Net Revenues
Adjusted EBITDA
Hotel Franchising
 $ 661  $ 308  $ 979  $ 470 
Hotel Management
 343  14  578  45 
Total Reportable Segments
 1,004  322  1,557  515 
Corporate and Other
 —  (51) 4  (54)
Total Company
 $ 1,004  $ 271  $ 1,561  $ 461 

The table below is a reconciliation of net income (loss) to adjusted EBITDA.
Nine Months Ended September 30, 2020
2020 2019
Net (loss)/income
 $ (125) $ 93 
(Benefit)/provision for income taxes (25) 36 
Depreciation and amortization 73  81 
Interest expense, net 83  76 
Stock-based compensation expense 14  11 
Impairments, net 206  45 
Restructuring costs 29  — 
Transaction-related expenses, net 13  30 
Separation-related expenses 1  22 
Contract termination costs —  43 
Transaction-related item —  20 
Foreign currency impact of highly inflationary countries 2  4 
Adjusted EBITDA
 $ 271  $ 461