v3.22.4
Business Segments
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Business segments Business Segments
We are a hospitality company with operations organized in two distinct operating segments: (i) management and franchise and (ii) ownership, each of which is reported as a segment based on (a) delivering a similar set of products and services; and (b) being managed separately given its distinct economic characteristics.

The management and franchise segment includes all of the hotels we manage for third-party owners, as well as all franchised hotels that license our IP and where we provide other contracted services to third-party owners, but the day-to-day services of the hotels are operated or managed by someone other than us. Revenues from this segment include: (i) management and franchise fees charged to third-party hotel owners; (ii) licensing fees from our strategic partners, including co-branded credit card providers, and HGV for the right to use our IP; and (iii) fees for managing hotels in our ownership segment. As of December 31, 2022, this segment included 778 managed hotels and 6,255 franchised hotels consisting of 1,096,115 total rooms.

As of December 31, 2022, our ownership segment included 52 properties totaling 17,612 rooms. The segment comprised 45 hotels that we leased, two hotels that were each leased by a consolidated VIE and five hotels owned or leased by unconsolidated affiliates. In December 2022, one non-wholly owned consolidated hotel and one of our leased hotels exited our system, and, therefore, they are not included in the number of owned and leased hotels as of December 31, 2022, although the results of operations of the hotels are consolidated in our financial statements for the year ended December 31, 2022 for the period prior to their exit.
As a result of the COVID-19 pandemic, the operations of certain of our hotels were suspended for some period of time. However, substantially all of the hotels in our management and franchise segment had re-opened by the end of 2021 and have remained open and operating since then. All of the hotels in our ownership segment that had suspended operations at some point in time as a result of the pandemic were open as of December 31, 2021.

The performance of our operating segments is evaluated primarily on operating income (loss), without allocating amortization of contract acquisition costs, other revenues and other expenses, other revenues and other expenses from managed and franchised properties, depreciation and amortization expenses or general and administrative expenses, and does not include equity in earnings (losses) from unconsolidated affiliates. Our chief operating decision maker does not use assets by operating segment when assessing performance or making operating segment resource allocations.

The following table presents revenues for our reportable segments, reconciled to consolidated amounts:

Year Ended December 31,
202220212020
(in millions)
Franchise and licensing fees$2,085 $1,508 $956 
Base and other management fees(1)
338 203 144 
Incentive management fees196 98 38 
Management and franchise2,619 1,809 1,138 
Ownership1,076 598 421 
Segment revenues3,695 2,407 1,559 
Amortization of contract acquisition costs(38)(32)(29)
Other revenues102 79 73 
Direct reimbursements from managed and franchised properties(2)
2,441 1,503 1,375 
Indirect reimbursements from managed and franchised properties(2)
2,596 1,841 1,332 
Intersegment fees elimination(1)
(23)(10)(3)
Total revenues$8,773 $5,788 $4,307 
____________
(1)Includes management, royalty and IP fees charged to consolidated hotels in our ownership segment by our management and franchise segment, which were eliminated in our consolidated statements of operations.
(2)Included in other revenues from managed and franchised properties in our consolidated statements of operations.
The following table presents operating income (loss) for each of our reportable segments, reconciled to consolidated income (loss) before income taxes:

Year Ended December 31,
202220212020
(in millions)
Management and franchise(1)
$2,619 $1,809 $1,138 
Ownership(1)
54 (91)(202)
Segment operating income2,673 1,718 936 
Amortization of contract acquisition costs(38)(32)(29)
Other revenues, less other expenses42 34 13 
Net other expenses from managed and franchised properties(39)(110)(397)
Depreciation and amortization expenses(162)(188)(331)
General and administrative expenses(382)(405)(311)
Reorganization costs— — (41)
Impairment losses— — (258)
Loss on sales of assets, net— (7)— 
Operating income (loss)2,094 1,010 (418)
Interest expense(415)(397)(429)
Gain (loss) on foreign currency transactions5 (7)(27)
Loss on debt extinguishments— (69)(48)
Other non-operating income (loss), net50 23 (2)
Income (loss) before income taxes$1,734 $560 $(924)
____________
(1)Includes management, royalty and IP fees charged to consolidated hotels in our ownership segment by our management and franchise segment, which were eliminated in our consolidated statements of operations.

Total revenues by country were as follows:

Year Ended December 31,
202220212020
(in millions)
U.S.$6,947 $4,765 $3,593 
All other(1)
1,826 1,023 714 
$8,773 $5,788 $4,307 
____________
(1)There are no countries included in these amounts that individually represented more than 10 percent of total revenues for the years ended December 31, 2022, 2021 and 2020.