10-KPeriod: FY2022

MARRIOTT INTERNATIONAL INC /MD/ Annual Report, Year Ended Dec 31, 2022

Filed February 14, 2023For Securities:MAR

Summary

Marriott International, Inc. reported a strong recovery in its 2022 fiscal year, demonstrating significant improvement in revenue and profitability compared to the previous year, driven by the continued rebound in global lodging demand following the COVID-19 pandemic. The company's asset-light business model, focused on management and franchising, proved resilient, with net fee revenues increasing by a substantial 52% year-over-year. This growth was primarily fueled by strong performance in both the U.S. & Canada and International segments, with RevPAR (Revenue per Available Room) showing robust recovery, particularly in the latter half of the year, exceeding pre-pandemic 2019 levels by the fourth quarter. The company also saw continued system growth, adding nearly 400 properties and over 65,000 rooms in 2022, with a robust development pipeline indicating future expansion potential. Marriott's strategic focus on its Marriott Bonvoy loyalty program and direct booking channels continues to be a key driver of customer engagement and revenue. The company is actively returning capital to shareholders through share repurchases and dividends, reflecting confidence in its financial position and future outlook. While global economic uncertainties and potential headwinds like inflation and labor market dynamics are acknowledged, Marriott's diversified brand portfolio, strong market presence, and ongoing investments in technology and associate development position it well for continued growth in the evolving hospitality landscape.

Financial Highlights

49 data points
Beta

Revenue

$20.77B

Net Income

$2.36B

11.4% Net Margin

EPS (Diluted)

$7.24

Total Assets

$24.82B

Cash & Equivalents

$507.00M

Free Cash Flow

$2.03B

Financial Statements
Beta
Revenue$20.77B
Operating Expenses$17.31B
Operating Income$3.46B
Interest Expense$403.00M
Net Income$2.36B
EPS (Basic)$7.27
EPS (Diluted)$7.24
Shares Outstanding (Basic)324.40M
Shares Outstanding (Diluted)325.80M

Key Highlights

  • 1Marriott reported a significant year-over-year increase in net fee revenues of 52%, reaching $3,989 million in 2022, reflecting the strong recovery in global lodging demand.
  • 2The company's system grew to 8,288 properties (1,525,407 rooms) by year-end 2022, with gross additions of 394 properties and a development pipeline of over 496,000 rooms.
  • 3Global RevPAR improved by 51.0% in 2022 compared to 2021, and by the fourth quarter of 2022, worldwide RevPAR exceeded 2019 levels by 4.6%, driven by strong ADR growth.
  • 4Marriott Bonvoy, the company's loyalty program, is a critical driver, with over half of global room nights booked by its members in 2022.
  • 5The company repurchased 16.8 million shares for $2.6 billion in 2022 and declared quarterly cash dividends, indicating a commitment to returning capital to shareholders.
  • 6The company's asset-light model is reinforced by owning or leasing less than 1% of its lodging properties, focusing on management and franchising fees.
  • 7Investments in technology systems and associate well-being are highlighted as strategic priorities for future growth and operational efficiency.

Frequently Asked Questions

Marriott International experienced a strong financial recovery in 2022. Net fee revenues increased by 52% to $3,989 million, driven by a 51% increase in gross fee revenues. This improvement was largely due to a 51.0% increase in worldwide RevPAR (Revenue per Available Room) compared to 2021, and by the fourth quarter, RevPAR had surpassed 2019 levels by 4.6%. The company also reported growth in its property portfolio and a significant development pipeline.

Marriott operates a diverse brand portfolio categorized into 'Classic' and 'Distinctive' offerings, further divided into Luxury, Premium, and Select tiers. The company expanded its system in 2022, adding 394 properties and over 65,000 rooms. It maintains a robust development pipeline with over 496,000 rooms, with a significant portion located outside the U.S. & Canada, indicating a strategic focus on international growth. Conversions from competitor brands and growth in Select and longer-stay brands were key drivers.

Marriott faces several risks, including intense competition in the lodging industry from hotel chains and alternative lodging platforms like Airbnb. Economic downturns, global events (geopolitical instability, pandemics, natural disasters), and fluctuations in currency exchange rates can significantly impact business. Operational risks include potential disagreements with hotel owners, the risk of data security breaches (like the past Starwood incident), and challenges in attracting and retaining associates. The company is also subject to various government regulations and potential impacts from climate change and sustainability concerns.

The Marriott Bonvoy loyalty program is a core asset, driving over half of the company's global room nights in 2022. Marriott actively markets to its large member base and uses co-branded credit card partnerships to enhance engagement and earn revenue. The company is also focused on improving its digital presence, including its mobile app and website, to drive direct bookings, which are generally more profitable. Their 'Best Rate Guarantee' and member-exclusive rates are key components of this strategy.