v3.22.2.2
Revenue from Contracts with Customers
 9 Months Ended
Sep. 30, 2022
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
Disaggregation of Revenue
The following tables show our disaggregated revenues by product and segment from contracts with customers. We operate our business in the following two segments: (i) Real estate sales and financing and (ii) Resort operations and club management. Please refer to Note 20: Business Segments below for more details related to our segments.
($ in millions)Three Months Ended September 30,Nine Months Ended September 30,
Real Estate Sales and Financing Segment2022202120222021
Sales of VOIs, net$500 $488 $1,130 $597 
Sales, marketing, brand and other fees177 118 457 252 
Interest income61 46 170 108 
Other financing revenue7 7 26 19 
Real estate sales and financing segment revenues$745 $659 $1,783 $976 
($ in millions)Three Months Ended September 30,Nine Months Ended September 30,
Resort Operations and Club Management Segment2022202120222021
Club management$48 $42 $150 $98 
Resort management82 57 229 94 
Rental(1)
157 104 436 184 
Ancillary services2 8 30 14 
Resort operations and club management segment revenues$289 $211 $845 $390 
(1)Excludes intersegment eliminations. See Note 20: Business Segments for additional information.
Contract Balances
The following table provides information on our accounts receivable from contracts with customers which are included in Accounts receivable, net on our unaudited condensed consolidated balance sheets:
($ in millions)September 30,
2022		December 31,
2021
Receivables$273 $202 
The following table presents the composition of our contract liabilities:
($ in millions)September 30,
2022		December 31,
2021
Contract liabilities:
Advanced deposits$138 $112 
Deferred sales of VOIs of projects under construction1 34 
Club dues and Legacy-HGV Club activation fees105 91 
Bonus Point incentive liability(1)
58 44 
(1)Amounts related to the Bonus Point incentive liability are included in Accounts payable, accrued expenses and other on our unaudited condensed consolidated balance sheets. This liability is comprised of unrecognized revenue for incentives from VOI sales and sales and marketing expenses in conjunction with our fee-for-service arrangements.
Revenue earned for the three and nine months ended September 30, 2022, that was included in the contract liabilities balance at December 31, 2021 was approximately $63 million and $161 million, respectively.
Our accounts receivable that relate to our contracts with customers includes amounts associated with our contractual right to consideration for completed performance obligations related primarily to our fee-for-service arrangements and homeowners’ associations management agreements and are settled when the related cash is received. Accounts receivable are recorded when the right to consideration becomes unconditional and is only contingent on the passage of time. Refer to Note 7: Timeshare Financing Receivables for information on balances and changes in balances during the period related to our timeshare financing receivables.
Contract assets relate to incentive fees that can be earned for meeting certain targets on sales of VOIs at properties under our fee-for-service arrangements; however, our right to consideration is conditional upon completing the requirements of the annual incentive fee period. There were $5 million contract assets as of September 30, 2022 and no contract assets as of December 31, 2021.
Contract liabilities include payments received or due in advance of satisfying our performance obligations. Such contract liabilities include advance deposits received on prepaid vacation packages for future stays at our resorts, deferred revenues related to sales of VOIs of projects under construction, Club activation fees and annual dues and the liability for Bonus Points awarded to our customers for purchase of VOIs at our properties or properties under our fee-for-service arrangements that may be redeemed in the future.
In addition to the contract liabilities included herein, we also have deferred revenue of $118 million and $112 million as of September 30, 2022 and December 31, 2021, respectively. This additional deferred revenue balance includes $50 million and $51 million for bonus points and vacation package deferred revenue, $22 million and $10 million in deferred property insurance, $17 million and $14 million in deferred maintenance fees and $28 million and $37 million in other deferred revenue as of September 30, 2022 and December 31, 2021, respectively.
Transaction Price Allocated to Remaining Performance Obligations
Transaction price allocated to remaining performance obligations represents contract revenue that has not yet been recognized. Our contracts with remaining performance obligations primarily include (i) sales of VOIs under construction, (ii) Legacy-HGV Club activation fees paid at closing of a VOI purchase, (iii) customers’ advanced deposits on prepaid vacation packages and (iv) Bonus Points that may be redeemed in the future.
The following table represents the deferred revenue, cost of VOI sales and direct selling costs from sales of VOIs related to projects under construction as of September 30, 2022 and December 31, 2021:
($ in millions)September 30,
2022		December 31,
2021
Sales of VOIs, net$1 $34 
Cost of VOI sales(1)
— 12 
Sales and marketing expense— 5 
(1)Includes anticipated Cost of VOI sales related to inventory associated with Sales of VOIs under construction.
We recognized the revenue, costs of VOI sales and direct selling costs related to the project under construction upon completion during the third quarter of 2022.
The following table includes the remaining transaction price related to Advanced deposits, and Legacy-HGV Club activation fees and Bonus Points as of September 30, 2022:
($ in millions)Remaining
Transaction Price		Recognition PeriodRecognition Method
Advanced deposits$138 18 monthsUpon customer stays
Legacy-HGV Club activation fees65 7 yearsStraight-line basis over average inventory holding period
Bonus Points58 
18 - 30 months
Upon redemption