PR Newswire | Feb 18, 2021 07:02AM EST

02/18 06:00 CST

Marriott International Reports Fourth Quarter 2020 Results BETHESDA, Md., Feb. 18, 2021

BETHESDA, Md., Feb. 18, 2021 /PRNewswire/ --

* Fourth quarter 2020 comparable systemwide constant dollar RevPAR declined 64.1 percent worldwide, 64.6 percent in the U.S. & Canada, and 62.7 percent in international markets, compared to the 2019 fourth quarter; * Fourth quarter reported diluted loss per share totaled $0.50, compared to reported diluted EPS of $0.85 in the year-ago quarter. Fourth quarter adjusted diluted EPS totaled $0.12, compared to fourth quarter 2019 adjusted diluted EPS of $1.51; * Fourth quarter reported net loss totaled $164 million, compared to reported net income of $279 million in the year-ago quarter. Fourth quarter adjusted net income totaled $39 million, compared to fourth quarter 2019 adjusted net income of $498 million; * Adjusted EBITDA totaled $317 million in the 2020 fourth quarter, compared to fourth quarter 2019 adjusted EBITDA of $901 million; * The company added nearly 63,000 rooms globally during 2020, including more than 28,000 rooms in international markets and a total of roughly 8,100 conversion rooms. Net rooms grew 3.1 percent from year-end 2019; * At year end, Marriott's worldwide development pipeline totaled nearly 2,900 properties and more than 498,000 rooms, including roughly 20,000 rooms approved, but not yet subject to signed contracts. Over 229,000 rooms in the pipeline were under construction as of the end of 2020; * As of year-end 2020, the company's net liquidity totaled approximately $4.4 billion, representing roughly $0.8 billion in available cash balances and $3.6 billion of unused borrowing capacity under its revolving credit facility.

Marriott International, Inc. (NASDAQ: MAR) today reported fourth quarter 2020 results, which were materially impacted by the COVID-19 global pandemic and efforts to contain it (COVID-19).

Leeny Oberg, Executive Vice President and Chief Financial Officer, said, "We are all deeply saddened by Arne Sorenson's unexpected passing. We are grateful to have been able to work with such an inspiring and talented leader and will always treasure our memories of working with him. Our leadership team is committed to honoring him by building on his incredible legacy as we move the company forward."

Stephanie Linnartz, Group President, Consumer Operations, Technology and Emerging Businesses, and Tony Capuano, Group President, Global Development, Design and Operations Services, who together are sharing responsibility for overseeing the company's day-to-day operations until Marriott's Board of Directors appoints a new President and Chief Executive Officer, commented on the company's quarterly results.

Ms. Linnartz said, "With the global pandemic, 2020 was the most challenging year in our 93-year history. In April, we experienced the sharpest worldwide RevPAR1 decline on record, down 90 percent year over year with just 12 percent occupancy. Demand around the world improved from this trough at varying rates, with China leading the way. RevPAR in mainland China saw a meaningful rebound through the year and was down less than 10 percent year over year in December.

"While China has shown that demand can be quite resilient when the virus is perceived to be contained, we have also seen that progress can be slowed by significant spikes in virus cases, such as we saw in the U.S and Europe towards the end of 2020. Global occupancy remained at 35 percent in the fourth quarter, in line with the third quarter, and still substantially above the trough in April. While no one can know how long this pandemic will last, we are seeing some small, early signs that the acceleration of vaccine rollouts around the world will help drive a significant rebound in travel and lodging demand."

Mr. Capuano said, "We are gratified that we continue to see strong demand for our industry leading brands from owners and franchisees despite the unprecedented challenges resulting from the pandemic. Our pipeline grew during the quarter to more than 498,000 rooms as of the end of 2020, with 46 percent of those rooms under construction. We are seeing strong interest in conversions, as demonstrated by our recent announcement of the planned conversion of 19 all-inclusive hotels with nearly 7,000 rooms to our system in the Caribbean and Latin America region during 2021. Looking ahead, we expect gross rooms growth could accelerate to approximately 6 percent in 2021.

"In the face of the unprecedented environment resulting from the pandemic, our associates and leadership team rose to the challenge. We worked closely with our owners and franchisees to help them weather the crisis by implementing cost savings, both temporary and permanent. And operationally we implemented heightened cleanliness standards across our portfolio to enhance the safety and wellbeing of our associates and guests, while also introducing additional protocols to help enable meeting and group business to safely take place."

Ms. Oberg added, "In 2020, we moved swiftly to right-size our business in response to the precipitous decline in revenue by reducing costs, strengthening our balance sheet, and lowering capital spending. While the current environment remains challenging, we believe our financial condition is strong and we look ahead to the rest of 2021 with optimism."

Fourth Quarter 2020 ResultsMarriott's reported operating loss totaled $128 million in the 2020 fourth quarter, compared to 2019 fourth quarter reported operating income of $274 million. Reported net loss totaled $164 million in the 2020 fourth quarter, compared to 2019 fourth quarter reported net income of $279 million. Reported diluted loss per share totaled $0.50 in the quarter, compared to reported diluted earnings per share (EPS) of $0.85 in the year-ago quarter.

Adjusted operating income in the 2020 fourth quarter totaled $148 million, compared to 2019 fourth quarter adjusted operating income of $717 million. Adjusted operating income in the 2020 fourth quarter and the 2019 fourth quarter excluded impairment charges of $44 million and $114 million, respectively.

Fourth quarter 2020 adjusted net income totaled $39 million, compared to 2019 fourth quarter adjusted net income of $498 million. Adjusted diluted EPS in the 2020 fourth quarter totaled $0.12, compared to adjusted diluted EPS of $1.51 in the year-ago quarter. These 2020 fourth quarter adjusted results excluded $74 million ($0.23 per share) of income tax benefits due to the closure of prior years' audits. The adjusted 2020 results also excluded impairment charges of $88 million after-tax ($0.27 per share) and loss on asset sales of $4 million after-tax ($0.01 per share).

Adjusted results also excluded restructuring and merger-related charges, cost reimbursement revenue, and reimbursed expenses. See pages A-3, A-4 and A-13 for the calculation of adjusted results and the manner in which the adjusted measures are determined in this press release.

Restructuring and merger-related charges totaled $262 million in the fourth quarter. Charges in the fourth quarter of 2020 largely reflect a $243 million increase to the liability for the Sheraton Grand Chicago put option.

Base management and franchise fees totaled $379 million in the 2020 fourth quarter, compared to base management and franchise fees of $799 million in the year-ago quarter. The year-over-year decline in these fees is primarily attributable to RevPAR declines related to COVID-19. Other non-RevPAR related franchise fees in the 2020 fourth quarter of $133 million declined $24 million, or 15 percent, from the year-ago quarter, largely due to lower credit card branding fees.

Incentive management fees totaled $44 million in the 2020 fourth quarter, compared to incentive management fees of $175 million in the year-ago quarter. The year-over-year decline in these fees is primarily attributable to lower net house profits at many hotels related to COVID-19. More than 60 percent of the incentive management fees recognized in the quarter were earned at hotels in the Asia Pacific region, of which three-quarters were earned in Greater China.

Contract investment amortization for the 2020 fourth quarter totaled $38 million, compared to $17 million in the year-ago quarter. The year-over-year change largely reflects impairments of investments in management and franchise contracts.

Owned, leased, and other revenue, net of direct expenses, totaled a $27 million loss in the 2020 fourth quarter, compared to $92 million of profit in the year-ago quarter as a result of RevPAR declines related to COVID-19.

Depreciation, amortization, and other expenses for the 2020 fourth quarter totaled $71 million, compared to $179 million in the year-ago quarter. The year-over-year change largely reflects $114 million of impairment charges recorded in the 2019 fourth quarter, partially offset by an $11 million impairment charge associated with a leased hotel in the U.S. recorded in the 2020 fourth quarter.

General, administrative, and other expenses for the 2020 fourth quarter totaled $183 million, compared to $267 million in the year-ago quarter. The lower expenses in the 2020 fourth quarter largely reflect the company's COVID-19-related cost reduction efforts.

Gains and other income, net, totaled $6 million, compared to $138 million in the year-ago quarter. Gains and other income, net, in the 2019 fourth quarter primarily reflected $134 million of gains associated with the sales of two hotels in the U.S. and Canada.

Interest expense, net, totaled $105 million in the fourth quarter compared to $89 million in the year-ago quarter. The increase is largely due to higher interest expense associated with new debt issuances.

Equity in losses for the fourth quarter totaled $87 million, largely reflecting impairment charges and the decline in results at joint venture properties due to COVID-19.

In the 2020 fourth quarter, the benefit for income taxes totaled $150 million, compared to the provision for income taxes of $47 million in the 2019 fourth quarter. The 2020 fourth quarter benefit included $100 million related to the closure of pre-acquisition Starwood audits.

Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) totaled $317 million in the 2020 fourth quarter, compared to fourth quarter 2019 adjusted EBITDA of $901 million. See page A-12 for the adjusted EBITDA calculation.

Selected Performance InformationThe company added 109 new properties (17,780 rooms) to its worldwide lodging portfolio during the 2020 fourth quarter, including roughly 2,600 rooms converted from competitor brands and approximately 9,000 rooms in international markets. Forty-six properties (8,011 rooms) exited the system during the quarter. At year end, Marriott's global lodging system totaled more than 7,600 properties and timeshare resorts, with over 1,423,000 rooms.

At year end, the company's worldwide development pipeline totaled 2,881 properties with more than 498,000 rooms, including 1,187 properties with over 229,000 rooms under construction and 119 properties with roughly 20,000 rooms approved for development, but not yet subject to signed contracts.

In the 2020 fourth quarter, worldwide RevPAR declined 64.1 percent (a 63.9 percent decline using actual dollars). RevPAR in the U.S. & Canada declined 64.6 percent (a 64.6 percent decline using actual dollars), and RevPAR in international markets declined 62.7 percent (a 62.2 percent decline using actual dollars).

Balance Sheet and LiquidityAt year-end 2020, Marriott's net debt was $9.5 billion, representing total debt of $10.4 billion less cash and cash equivalents of $0.9 billion. At year-end 2019, the company's net debt was $10.7 billion, representing total debt of $10.9 billion less cash and cash equivalents of $0.2 billion.

The company's net liquidity was approximately $4.4 billion at year end, representing roughly $0.8 billion in available cash balances and $3.6 billion of unused borrowing capacity under its revolving credit facility. During the fourth quarter, the company reduced its debt by more than $600 million.

The company halted share repurchases in February of 2020 and suspended its quarterly dividend beginning in the second quarter of 2020.

COVID-19Due to the numerous uncertainties associated with COVID-19, Marriott cannot presently estimate the impact of this unprecedented situation on its future results, which is highly dependent on the severity and duration of the pandemic and its impacts, but expects that COVID-19 will continue to be material to the company's results.

The company expects to provide additional information about the current impact of COVID-19 on its business on its call later this morning.

Marriott International, Inc. (NASDAQ: MAR) will conduct its quarterly earnings review for the investment community and news media on Thursday, February 18, 2021 at 8:30 a.m. Eastern Time (ET). The conference call will be webcast simultaneously via Marriott's investor relations website at http://www.marriott.com/investor, click on "Events & Presentations" and click on the quarterly conference call link. A replay will be available at that same website until February 17, 2022.

The telephone dial-in number for the conference call is 706-679-3455 and the conference ID is 2083356. A telephone replay of the conference call will be available from 2:00 p.m. ET, Thursday, February 18, 2021 until 8:00 p.m. ET, Thursday, February 25, 2021. To access the replay, call 404-537-3406. The conference ID for the recording is 2083356.

Note on forward-looking statements: All statements in this press release and the accompanying schedules are made as of February 18, 2021. We undertake no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise. This press release and the accompanying schedules contain "forward-looking statements" within the meaning of federal securities laws, including statements related to the possible effects on our business of the COVID-19 pandemic and efforts to contain it (COVID-19); travel and lodging demand; future performance of the company's hotels; cost savings; demand for our brands; our development pipeline, rooms growth and conversions; leadership changes; and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous evolving risks and uncertainties that we may not be able to accurately predict or assess, including those we identify below and other risk factors that we identify in our Securities and Exchange Commission filings, including our most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K. Risks that could affect forward-looking statements in this press release include the duration and scope of COVID-19, including the availability and distribution of effective vaccines or treatments; its short and longer-term impact on the demand for travel, transient and group business, and levels of consumer confidence; actions governments, businesses and individuals have taken or may take in response to the pandemic, including limiting or banning travel and/or in-person gatherings or imposing occupancy or other restrictions on lodging or other facilities; the impact of the pandemic and actions taken in response to the pandemic on global and regional economies, travel, and economic activity, including the duration and magnitude of its impact on unemployment rates and consumer discretionary spending; the ability of our owners and franchisees to successfully navigate the impacts of COVID-19; the pace of recovery when the pandemic subsides or effective treatments or vaccines become widely available; general economic uncertainty in key global markets and a worsening of global economic conditions or low levels of economic growth; the effects of steps we and our property owners and franchisees have taken and may continue to take to reduce operating costs and/or enhance certain health and cleanliness protocols at our hotels; the impacts of our employee furloughs and reduced work week schedules, our voluntary transition program and our other restructuring activities; competitive conditions in the lodging industry; relationships with customers and property owners; the availability of capital to finance hotel growth and refurbishment; the extent to which we experience adverse effects from data security incidents; and changes in tax laws in countries in which we earn significant income. Any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release.

Marriott International, Inc. (NASDAQ: MAR) is based in Bethesda, Maryland, USA, and encompasses a portfolio of more than 7,600 properties under 30 leading brands spanning 133 countries and territories. Marriott operates and franchises hotels and licenses vacation ownership resorts all around the world. The company offers Marriott Bonvoy(tm), its highly-awarded travel program. For more information, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com. In addition, connect with us on Facebook and @MarriottIntl on Twitter and Instagram.

Marriott may post updates about COVID-19 and other matters on its investor relations website at www.marriott.com/investor or Marriott's news center website at www.marriottnewscenter.com. Marriott encourages investors, the media, and others interested in the company to review and subscribe to the information Marriott posts on these websites, which may be material. The contents of these websites are not incorporated by reference into this press release or any report or document Marriott files with the SEC, and any references to the websites are intended to be inactive textual references only.

1 All occupancy and RevPAR statistics are comparable systemwide constant dollar and include hotels that have been temporarily closed due to COVID-19. Unless otherwise stated, all changes refer to year-over-year changes for the comparable period.

IRPR#1Tables follow

MARRIOTT INTERNATIONAL, INC.

PRESS RELEASE SCHEDULES

TABLE OF CONTENTS

QUARTER 4, 2020

Consolidated Statements of Income - As Reported A-1

Non-GAAP Financial Measures - Fourth Quarter and Full Year 2020 and 2019 A-3

Non-GAAP Financial Measures - 2020 Quarterly A-4

Total Lodging Products A-5

Key Lodging Statistics A-8

Adjusted EBITDA A-12

Explanation of Non-GAAP Financial and Performance Measures A-13

MARRIOTT INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF INCOME - AS REPORTED

FOURTH QUARTER 2020 AND 2019

(in millions except per share amounts, unaudited)

As Reported As Reported Percent

Three Months Ended Three Months Ended Better/(Worse)

December 31, 2020 December 31, 2019 Reported 2020 vs. 2019

REVENUES

Base management fees $ 102 $ 298 (66)

Franchise fees ^1 277 501 (45)

Incentive management fees 44 175 (75)

Gross Fee Revenues 423 974 (57)

Contract investment amortization ^2 (38) (17) (124)

Net Fee Revenues 385 957 (60)

Owned, leased, and other revenue ^3 123 426 (71)

Cost reimbursement revenue ^4 1,664 3,988 (58)

Total Revenues 2,172 5,371 (60)

OPERATING COSTS AND EXPENSES

Owned, leased, and other - direct ^5 150 334 55

Depreciation, amortization, and other ^6 71 179 60

General, administrative, and other ^7 183 267 31

Restructuring and merger-related charges (recoveries) 262 (53) (594)

Reimbursed expenses ^4 1,634 4,370 63

Total Expenses 2,300 5,097 55

OPERATING (LOSS) INCOME (128) 274 (147)

Gains and other income, net ^8 6 138 (96)

Interest expense (112) (95) (18)

Interest income 7 6 17

Equity in (losses) earnings ^9 (87) 3 (3,000)

(LOSS) INCOME BEFORE INCOME TAXES (314) 326 (196)

Benefit (provision) for income taxes 150 (47) 419

NET (LOSS) INCOME $ (164) $ 279 (159)

(LOSS) EARNINGS PER SHARE

(Loss) Earnings per share - basic $ (0.50) $ 0.85 (159)

(Loss) Earnings per share - diluted $ (0.50) $ 0.85 (159)

Basic Shares 326.2 327.7

Diluted Shares ^10 326.2 330.4

^1 Franchise fees include fees from our franchise agreements, application and relicensing fees, licensing fees from our timeshare, credit card programs, and

residential branding fees.

^2 Contract investment amortization includes amortization of capitalized costs to obtain contracts with our owner and franchisee customers, and any related

impairments, accelerations, or write-offs.

^3 Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, and other revenue.

Cost reimbursement revenue includes reimbursements from properties for^4 property-level and centralized programs and services that we operate for the benefit of

our hotel owners. Reimbursed expenses include costs incurred by Marriott for certain property-level operating expenses and centralized programs and services.

Owned, leased, and other - direct expenses include operating expenses related^5 to our owned or leased hotels, including lease payments and pre-opening expenses.

Depreciation, amortization, and other expenses include depreciation for fixed^6 assets, amortization of capitalized costs incurred to acquire management, franchise,

and license agreements, and any related impairments, accelerations, or write-offs.

^7 General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses.

Gains and other income, net includes gains and losses on the sale of real^8 estate, the sale of joint venture interests and other investments, and adjustments from

other equity investments.

^9 Equity in (losses) earnings include our equity in earnings or losses of unconsolidated equity method investments.

Basic and fully diluted weighted average shares outstanding used to calculate^10 (loss) earnings per share for the period in which we had a loss are the same because

inclusion of additional equivalents would be anti-dilutive.

MARRIOTT INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF INCOME - AS REPORTED

FOURTH QUARTER YEAR-TO-DATE 2020 AND 2019

(in millions except per share amounts, unaudited)

As Reported As Reported Percent

Twelve Months Ended Twelve Months Ended Better/(Worse)

December 31, 2020 December 31, 2019 Reported 2020 vs. 2019

REVENUES

Base management fees $ 443 $ 1,180 (62)

Franchise fees ^1 1,153 2,006 (43)

Incentive management fees 87 637 (86)

Gross Fee Revenues 1,683 3,823 (56)

Contract investment amortization ^2 (132) (62) (113)

Net Fee Revenues 1,551 3,761 (59)

Owned, leased, and other revenue ^3 568 1,612 (65)

Cost reimbursement revenue ^4 8,452 15,599 (46)

Total Revenues 10,571 20,972 (50)

OPERATING COSTS AND EXPENSES

Owned, leased, and other - direct ^5 677 1,316 49

Depreciation, amortization, and other ^6 346 341 (1)

General, administrative, and other ^7 762 938 19

Restructuring and merger-related charges 267 138 (93)

Reimbursed expenses ^4 8,435 16,439 49

Total Expenses 10,487 19,172 45

OPERATING INCOME 84 1,800 (95)

Gains and other income, net ^8 9 154 (94)

Interest expense (445) (394) (13)

Interest income 27 26 4

Equity in (losses) earnings ^9 (141) 13 (1,185)

(LOSS) INCOME BEFORE INCOME TAXES (466) 1,599 (129)

Benefit (provision) for income taxes 199 (326) 161

NET (LOSS) INCOME $ (267) $ 1,273 (121)

(LOSS) EARNINGS PER SHARE

(Loss) Earnings per share - basic $ (0.82) $ 3.83 (121)

(Loss) Earnings per share - diluted $ (0.82) $ 3.80 (122)

Basic Shares 325.8 332.7

Diluted Shares ^10 325.8 335.5

^1 Franchise fees include fees from our franchise agreements, application and relicensing fees, licensing fees from our timeshare, credit card programs, and

residential branding fees.

^2 Contract investment amortization includes amortization of capitalized costs to obtain contracts with our owner and franchisee customers, and any related

impairments, accelerations, or write-offs.

^3 Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, and other revenue.

Cost reimbursement revenue includes reimbursements from properties for^4 property-level and centralized programs and services that we operate for the benefit of

our hotel owners. Reimbursed expenses include costs incurred by Marriott for certain property-level operating expenses and centralized programs and services.

Owned, leased, and other - direct expenses include operating expenses related^5 to our owned or leased hotels, including lease payments and pre-opening expenses.

Depreciation, amortization, and other expenses include depreciation for fixed^6 assets, amortization of capitalized costs incurred to acquire management, franchise,

and license agreements, and any related impairments, accelerations, or write-offs.

^7 General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses.

Gains and other income, net includes gains and losses on the sale of real^8 estate, the sale of joint venture interests and other investments, and adjustments from

other equity investments.

^9 Equity in (losses) earnings include our equity in earnings or losses of unconsolidated equity method investments.

Basic and fully diluted weighted average shares outstanding used to calculate^10 (loss) earnings per share for the period in which we had a loss are the same because

inclusion of additional equivalents would be anti-dilutive.

MARRIOTT INTERNATIONAL, INC.

NON-GAAP FINANCIAL MEASURES - FOURTH QUARTER AND FULL YEAR 2020 AND 2019

($ in millions except per share amounts)

The following table presents our reconciliations of Adjusted operating income, Adjusted operating income margin, Adjusted net income, and Adjusted diluted earnings per share,

to the most directly comparable GAAP measure. Adjusted total revenues is used in the determination of Adjusted operating income margin.

Three Months Ended Twelve Months Ended

Percent Percent

December 31, December 31, Better/ December 31, December 31, Better/

2020 2019 (Worse) 2020 2019 (Worse)

Total revenues, as reported $ 2,172 $ 5,371 $ 10,571 $ 20,972

Less: Cost reimbursement revenue (1,664) (3,988) (8,452) (15,599)

Add: Impairments ^1 22 - 62 -

Adjusted total revenues** 530 1,383 2,181 5,373

Operating (loss) income, as reported (128) 274 84 1,800

Less: Cost reimbursement revenue (1,664) (3,988) (8,452) (15,599)

Add: Reimbursed expenses 1,634 4,370 8,435 16,439

Add (Less): Restructuring and merger-related charges (recoveries) 262 (53) 267 138

Add: Impairments^2 44 114 201 114

Adjusted operating income ** 148 717 -79% 535 2,892 -82%

Operating (loss) income margin -6% 5% 1% 9%

Adjusted operating income margin ** 28% 52% 25% 54%

Net (loss) income, as reported (164) 279 (267) 1,273

Less: Cost reimbursement revenue (1,664) (3,988) (8,452) (15,599)

Add: Reimbursed expenses 1,634 4,370 8,435 16,439

Add (Less): Restructuring and merger-related charges (recoveries) 262 (53) 267 138

Add: Impairments ^3 113 114 278 114

Add (Less): Loss (gain) on asset dispositions ^4 6 (134) 6 (143)

Income tax effect of above adjustments (74) (90) (134) (236)

Less: Income tax benefit due to audit closures (74) - (74) -

Adjusted net income ** $ 39 $ 498 -92% $ 59 $ 1,986 -97%

Diluted (loss) earnings per share, as reported $ (0.50) $ 0.85 $ (0.82) $ 3.80

Adjusted diluted earnings per share** $ 0.12 $ 1.51 -92% $ 0.18 $ 5.92 -97%

Denotes non-GAAP financial measures. Please see pages A-13 and A-14 for^** information about our reasons for providing these alternative financial measures and the

limitations on their use.

Includes impairment charges reported in Contract investment amortization of $22^1 million and $62 million in the 2020 fourth quarter and 2020 full year, respectively.

Includes impairment charges reported in Contract investment amortization of $22^2 million and $62 million; and Depreciation, amortization, and other of $22 million and $139 million

in the 2020 fourth quarter and 2020 full year, respectively. Includes impairment charges reported in Depreciation, amortization, and other of $114 million in both the 2019

fourth quarter and 2019 full year.

Includes impairment charges reported in Contract investment amortization of $22^3 million and $62 million; Depreciation, amortization, and other of $22 million and $139 million;

Equity in earnings (losses) of $69 million and $77 million in the 2020 fourth quarter and 2020 full year, respectively. Includes impairment charges reported in Depreciation, amortization,

and other of $114 million in both the 2019 fourth quarter and 2019 full year.

^4 Loss (gain) on asset dispositions reported in Gains and other income, net.

MARRIOTT INTERNATIONAL, INC.

NON-GAAP FINANCIAL MEASURES - 2020 QUARTERLY

($ in millions except per share amounts)

The following table presents our reconciliations of Adjusted operating income (loss), Adjusted operating income (loss) margin, Adjusted net income (loss), and

Adjusted diluted earnings (loss) per share, to the most directly comparable GAAP measure. Adjusted total revenues is used in the determination of Adjusted

operating income (loss) margin.

Fiscal Year 2020

First Second Third Fourth Total Quarter Quarter Quarter Quarter

Total revenues, as reported $ 4,681 $ 1,464 $ 2,254 $ 2,172 $ 10,571

Less: Cost reimbursement revenue (3,797) (1,202) (1,789) (1,664) (8,452)

Add: Impairments ^1 7 3 30 22 62

Adjusted total revenues** 891 265 495 530 2,181

Operating income (loss), as reported 114 (154) 252 (128) 84

Less: Cost reimbursement revenue (3,797) (1,202) (1,789) (1,664) (8,452)

Add: Reimbursed expenses 3,877 1,241 1,683 1,634 8,435

(Less) Add: Restructuring and merger-related (recoveries) charges (2) 6 1 262 267

Add: Impairments^2 101 24 32 44 201

Adjusted operating income (loss) ** 293 (85) 179 148 535

Operating income (loss) margin 2% -11% 11% -6% 1%

Adjusted operating income (loss) margin ** 33% -32% 36% 28% 25%

Net income (loss), as reported 31 (234) 100 (164) (267)

Less: Cost reimbursement revenue (3,797) (1,202) (1,789) (1,664) (8,452)

Add: Reimbursed expenses 3,877 1,241 1,683 1,634 8,435

(Less) Add: Restructuring and merger-related (recoveries) charges (2) 6 1 262 267

Add: Impairments ^3 101 32 32 113 278

Add: Loss on asset dispositions^4 - - - 6 6

Income tax effect of above adjustments (50) (27) 17 (74) (134)

Less: Income tax benefit due to audit closures - - - (74) (74)

Adjusted net income (loss) ** $ 160 $ (184) $ 44 $ 39 $ 59

Diluted earnings (loss) per share, as reported $ 0.09 $ (0.72) $ 0.31 $ (0.50) $ (0.82)

Adjusted diluted earnings (loss) per share** $ 0.49 $ (0.57) $ 0.13 $ 0.12 $ 0.18

Denotes non-GAAP financial measures. Please see pages A-13 and A-14 for^** information about our reasons for providing these alternative financial measures

and the limitations on their use.

Includes impairment charges reported in Contract investment amortization of $7^1 million, $3 million, $30 million, $22 million and $62 million in the first quarter,

second quarter, third quarter, fourth quarter and full year, respectively.

Includes impairment charges reported in Contract investment amortization of $7^2 million, $3 million, $30 million, $22 million and $62 million; and Depreciation,

amortization, and other of $94 million, $21 million, $2 million, $22 million and $139 million in the first quarter, second quarter, third quarter, fourth quarter

and full year, respectively.

^3 Includes impairment charges reported in Contract investment amortization of $7 million, $3 million, $30 million, $22 million and $62 million; Depreciation,

amortization, and other of $94 million, $21 million, $2 million, $22 million and $139 million; and Equity in earnings (losses) of $0 million, $8 million, $0 million,

$69 million and $77 million in the first quarter, second quarter, third quarter, fourth quarter and full year, respectively.

^4 Loss on asset dispositions reported in Gains and other income, net.

MARRIOTT INTERNATIONAL, INC.

TOTAL LODGING PRODUCTS

As of December 31, 2020

US & Canada Total International Total Worldwide

Units Rooms Units Rooms Units Rooms

Managed 733 234,576 1,266 326,159 1,999 560,735

Marriott Hotels 115 62,212 178 51,890 293 114,102

Marriott Hotels Serviced Apartments - - 1 154 1 154

Sheraton 28 23,609 189 63,573 217 87,182

Courtyard 220 34,988 105 22,812 325 57,800

Westin 41 22,349 72 21,924 113 44,273

JW Marriott 21 12,711 61 22,581 82 35,292

Renaissance 24 10,607 59 18,402 83 29,009

The Ritz-Carlton 38 11,404 63 16,175 101 27,579

The Ritz-Carlton Serviced Apartments - - 5 713 5 713

Le M?ridien 2 160 71 20,314 73 20,474

Four Points 1 134 80 21,892 81 22,026

Residence Inn 108 16,344 6 701 114 17,045

W Hotels 22 6,403 32 8,445 54 14,848

W Hotels Serviced Apartments - - 1 160 1 160

The Luxury Collection 6 2,296 50 9,084 56 11,380

Gaylord Hotels 6 9,918 - - 6 9,918

St. Regis 10 1,968 34 7,819 44 9,787

Aloft 1 330 39 8,957 40 9,287

St. Regis Serviced Apartments - - 1 70 1 70

AC Hotels by Marriott 5 901 67 8,180 72 9,081

Delta Hotels 25 6,770 1 360 26 7,130

Fairfield by Marriott 7 1,539 42 6,074 49 7,613

SpringHill Suites 30 4,896 - - 30 4,896

Marriott Executive Apartments - - 33 4,812 33 4,812

Autograph Collection 8 2,335 14 2,200 22 4,535

Protea Hotels - - 32 3,911 32 3,911

EDITION 4 1,209 7 1,488 11 2,697

TownePlace Suites 10 1,313 - - 10 1,313

Element 1 180 8 1,690 9 1,870

Moxy - - 5 887 5 887

Tribute Portfolio - - 5 453 5 453

Bulgari - - 5 438 5 438

Franchised 4,716 676,773 676 137,726 5,392 814,499

Courtyard 819 109,111 91 16,700 910 125,811

Fairfield by Marriott 1,054 98,362 29 5,089 1,083 103,451

Residence Inn 745 88,737 13 1,566 758 90,303

Marriott Hotels 223 70,452 60 17,745 283 88,197

Sheraton 155 46,636 66 18,808 221 65,444

SpringHill Suites 458 52,694 - - 458 52,694

TownePlace Suites 436 44,007 - - 436 44,007

Westin 88 29,283 23 7,171 111 36,454

Autograph Collection 115 23,114 65 12,199 180 35,313

Four Points 157 23,702 57 9,215 214 32,917

Renaissance 62 17,956 28 7,691 90 25,647

Aloft 133 19,289 19 3,074 152 22,363

AC Hotels by Marriott 68 11,436 36 6,412 104 17,848

Moxy 21 4,149 48 9,499 69 13,648

Delta Hotels 52 11,456 7 1,706 59 13,162

The Luxury Collection 11 2,794 48 8,863 59 11,657

Le M?ridien 20 4,588 16 4,225 36 8,813

JW Marriott 13 5,947 6 1,624 19 7,571

Element 54 7,207 2 293 56 7,500

Tribute Portfolio 26 4,571 17 1,947 43 6,518

Protea Hotels - - 36 2,949 36 2,949

Design Hotels 5 853 7 799 12 1,652

The Ritz-Carlton 1 429 - - 1 429

Bulgari - - 1 85 1 85

Marriott Executive Apartments - - 1 66 1 66

MARRIOTT INTERNATIONAL, INC.

TOTAL LODGING PRODUCTS

As of December 31, 2020

US & Canada Total International Total Worldwide

Units Rooms Units Rooms Units Rooms

Owned/Leased 26 6,483 40 9,417 66 15,900

Courtyard 19 2,814 4 894 23 3,708

Marriott Hotels 2 1,308 6 2,064 8 3,372

Sheraton - - 4 1,830 4 1,830

W Hotels 2 779 2 665 4 1,444

Protea Hotels - - 6 991 6 991

Westin 1 1,073 - - 1 1,073

Renaissance 1 317 2 505 3 822

Autograph Collection^1 - - 7 705 7 705

The Ritz-Carlton - - 2 550 2 550

JW Marriott - - 1 496 1 496

The Luxury Collection^2 - - 4 417 4 417

Residence Inn 1 192 1 140 2 332

St. Regis - - 1 160 1 160

Residences 59 6,258 35 2,897 94 9,155

The Ritz-Carlton Residences 35 4,064 11 938 46 5,002

W Residences 10 1,089 4 359 14 1,448

St. Regis Residences 8 703 7 598 15 1,301

Bulgari Residences - - 5 514 5 514

Westin Residences 3 266 - - 3 266

The Luxury Collection Residences 1 91 3 115 4 206

Marriott Hotels Residences - - 2 246 2 246

Autograph Collection Residences - - 1 62 1 62

Sheraton Residences - - 1 50 1 50

EDITION Residences 2 45 - - 2 45

Le M?ridien Residences - - 1 15 1 15

Timeshare* 72 18,905 19 3,850 91 22,755

Grand Total 5,606 942,995 2,036 480,049 7,642 1,423,044

*Timeshare property and room counts are included on this table in theirgeographical locations. For external reporting purposes,these counts are captured in the Corporate segment.

^1 Includes five properties acquired when we purchased Elegant Hotels Group inDecember 2019 which we currently intend to re-brand under the Autograph Collection brand following the completion of plannedrenovations.

^2 Includes two properties acquired when we purchased Elegant Hotels Group inDecember 2019 which we currently intend to re-brand under The Luxury Collection brand following the completion of plannedrenovations.

MARRIOTT INTERNATIONAL, INC.

TOTAL LODGING PRODUCTS

As of December 31, 2020

US & Canada Total International Total Worldwide

Total Systemwide Units Rooms Units Rooms Units Rooms

Luxury 184 51,932 354 82,357 538 134,289

JW Marriott 34 18,658 68 24,701 102 43,359

The Ritz-Carlton 39 11,833 65 16,725 104 28,558

The Ritz-Carlton Residences 35 4,064 11 938 46 5,002

The Ritz-Carlton Serviced Apartments - - 5 713 5 713

The Luxury Collection^1 17 5,090 102 18,364 119 23,454

The Luxury Collection Residences 1 91 3 115 4 206

W Hotels 24 7,182 34 9,110 58 16,292

W Residences 10 1,089 4 359 14 1,448

W Hotels Serviced Apartments - - 1 160 1 160

St. Regis 10 1,968 35 7,979 45 9,947

St. Regis Residences 8 703 7 598 15 1,301

St. Regis Serviced Apartments - - 1 70 1 70

EDITION 4 1,209 7 1,488 11 2,697

EDITION Residences 2 45 - - 2 45

Bulgari - - 6 523 6 523

Bulgari Residences - - 5 514 5 514

Full-Service 1,002 349,833 937 261,916 1,939 611,749

Marriott Hotels 340 133,972 244 71,699 584 205,671

Marriott Hotels Residences - - 2 246 2 246

Marriott Hotels Serviced Apartments - - 1 154 1 154

Sheraton 183 70,245 259 84,211 442 154,456

Sheraton Residences - - 1 50 1 50

Westin 130 52,705 95 29,095 225 81,800

Westin Residences 3 266 - - 3 266

Renaissance 87 28,880 89 26,598 176 55,478

Autograph Collection^2 123 25,449 86 15,104 209 40,553

Autograph Collection Residences - - 1 62 1 62

Le M?ridien 22 4,748 87 24,539 109 29,287

Le M?ridien Residences - - 1 15 1 15

Delta Hotels 77 18,226 8 2,066 85 20,292

Gaylord Hotels 6 9,918 - - 6 9,918

Tribute Portfolio 26 4,571 22 2,400 48 6,971

Marriott Executive Apartments - - 34 4,878 34 4,878

Design Hotels 5 853 7 799 12 1,652

Limited-Service 4,348 522,325 726 131,926 5,074 654,251

Courtyard 1,058 146,913 200 40,406 1,258 187,319

Fairfield by Marriott 1,061 99,901 71 11,163 1,132 111,064

Residence Inn 854 105,273 20 2,407 874 107,680

SpringHill Suites 488 57,590 - - 488 57,590

Four Points 158 23,836 137 31,107 295 54,943

TownePlace Suites 446 45,320 - - 446 45,320

Aloft 134 19,619 58 12,031 192 31,650

AC Hotels by Marriott 73 12,337 103 14,592 176 26,929

Moxy 21 4,149 53 10,386 74 14,535

Element 55 7,387 10 1,983 65 9,370

Protea Hotels - - 74 7,851 74 7,851

Timeshare* 72 18,905 19 3,850 91 22,755

Grand Total 5,606 942,995 2,036 480,049 7,642 1,423,044

*Timeshare property and room counts are included on this table in theirgeographical locations. For external reporting purposes,these counts are captured in the Corporate segment.

^1 Includes two properties acquired when we purchased Elegant Hotels Group inDecember 2019 which we currently intend to re-brand under The Luxury Collection brand following the completion of plannedrenovations.

^2 Includes five properties acquired when we purchased Elegant Hotels Group inDecember 2019 which we currently intend to re-brand under the Autograph Collection brand following the completion of plannedrenovations.

MARRIOTT INTERNATIONAL, INC.

KEY LODGING STATISTICS

In Constant $

Comparable Company-Operated US & Canada Properties

Three Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Brand 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

JW Marriott $52.85 -74.7% 21.2% -54.0% pts. $249.73 -10.0%

The Ritz-Carlton $119.92 -61.6% 29.0% -43.5% pts. $413.27 -3.9%

W Hotels $47.52 -78.1% 23.6% -52.0% pts. $201.02 -30.0%

Composite US & Canada Luxury^1 $85.79 -68.4% 25.1% -49.7% pts. $342.01 -5.8%

Marriott Hotels $24.28 -83.1% 18.6% -54.4% pts. $130.44 -33.9%

Sheraton $23.41 -85.5% 16.1% -59.2% pts. $145.49 -32.4%

Westin $32.23 -80.5% 22.5% -53.1% pts. $143.53 -34.4%

Composite US & Canada Premium^2 $26.53 -82.2% 18.6% -55.1% pts. $142.73 -29.3%

US & Canada Full-Service^3 $38.27 -77.9% 19.9% -54.1% pts. $192.53 -17.8%

Courtyard $27.87 -70.2% 31.2% -36.4% pts. $89.43 -35.5%

Residence Inn $58.26 -50.7% 49.0% -26.4% pts. $118.99 -24.0%

Composite US & Canada Limited-Service^4 $35.79 -64.8% 35.6% -35.0% pts. $100.42 -30.3%

US & Canada - All^5 $37.47 -75.0% 24.9% -47.9% pts. $150.24 -27.1%

Comparable Systemwide US & Canada Properties

Three Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Brand 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

JW Marriott $50.74 -74.0% 23.0% -50.2% pts. $220.30 -17.3%

The Ritz-Carlton $115.85 -62.6% 28.2% -44.4% pts. $410.74 -3.7%

W Hotels $47.52 -78.1% 23.6% -52.0% pts. $201.02 -30.0%

Composite US & Canada Luxury^1 $77.53 -69.3% 25.1% -49.2% pts. $309.24 -9.3%

Marriott Hotels $27.60 -77.2% 22.4% -46.7% pts. $123.23 -29.5%

Sheraton $24.47 -77.9% 22.5% -46.6% pts. $108.57 -32.3%

Westin $33.05 -77.1% 24.0% -48.9% pts. $137.61 -30.5%

Composite US & Canada Premium^2 $30.92 -75.7% 23.3% -47.0% pts. $132.98 -26.6%

US & Canada Full-Service^3 $36.10 -74.4% 23.5% -47.3% pts. $153.91 -23.0%

Courtyard $34.31 -63.3% 35.9% -32.0% pts. $95.62 -30.5%

Residence Inn $61.11 -43.7% 55.0% -19.8% pts. $111.10 -23.5%

Fairfield by Marriott $36.22 -51.5% 41.7% -24.7% pts. $86.76 -22.8%

Composite US & Canada Limited-Service^4 $41.96 -54.3% 43.1% -26.6% pts. $97.30 -26.1%

US & Canada - All^5 $39.58 -64.6% 35.1% -35.0% pts. $112.64 -29.4%

^1 Includes JW Marriott, The Ritz-Carlton, W Hotels, The Luxury Collection, St.Regis, and EDITION.

^2 Includes Marriott Hotels, Sheraton, Westin, Renaissance, AutographCollection, Delta Hotels, Gaylord Hotels,

and Le M?ridien. Systemwide also includes Tribute Portfolio.

^3 Includes Composite US & Canada Luxury and Composite US & Canada Premium.

^4 Includes Courtyard, Residence Inn, Fairfield by Marriott, SpringHill Suites,TownePlace Suites, Four Points, Aloft, Element,

and AC Hotels by Marriott. Systemwide also includes Moxy.

^5 Includes US & Canada Full-Service and Composite US & Canada Limited-Service.

MARRIOTT INTERNATIONAL, INC.

KEY LODGING STATISTICS

In Constant $

Comparable Company-Operated International Properties

Three Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Region 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

Greater China $71.41 -19.6% 63.0% -8.1% pts. $113.42 -9.2%

Rest of Asia Pacific $42.74 -66.5% 33.2% -43.7% pts. $128.71 -22.4%

Asia Pacific $58.29 -45.3% 49.3% -24.4% pts. $118.13 -18.2%

Caribbean & Latin America $44.76 -66.4% 28.4% -35.8% pts. $157.44 -24.0%

Europe $19.91 -86.1% 14.5% -58.5% pts. $137.50 -29.9%

Middle East & Africa $50.61 -56.1% 36.8% -36.1% pts. $137.58 -13.0%

International - All^1 $47.69 -59.6% 38.1% -34.6% pts. $125.15 -22.8%

Worldwide^2 $42.95 -67.7% 32.0% -40.8% pts. $134.21 -26.5%

Comparable Systemwide International Properties

Three Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Region 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

Greater China $69.46 -21.6% 61.7% -8.9% pts. $112.52 -10.4%

Rest of Asia Pacific $47.20 -62.9% 35.1% -41.1% pts. $134.44 -19.4%

Asia Pacific $58.04 -46.4% 48.1% -25.4% pts. $120.74 -18.1%

Caribbean & Latin America $29.78 -70.8% 24.4% -35.9% pts. $122.28 -27.9%

Europe $18.72 -85.0% 15.3% -56.6% pts. $122.38 -29.5%

Middle East & Africa $47.91 -56.3% 36.4% -35.8% pts. $131.74 -13.4%

International - All^1 $41.95 -62.7% 34.2% -37.1% pts. $122.68 -22.3%

Worldwide^2 $40.28 -64.1% 34.9% -35.6% pts. $115.55 -27.4%

^1 Includes Asia Pacific, Caribbean & Latin America, Europe, and Middle East &Africa.

^2 Includes US & Canada - All and International - All.

MARRIOTT INTERNATIONAL, INC.

KEY LODGING STATISTICS

In Constant $

Comparable Company-Operated US & Canada Properties

Twelve Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Brand 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

JW Marriott $72.34 -66.7% 26.7% -51.7% pts. $270.68 -2.2%

The Ritz-Carlton $130.60 -57.8% 31.0% -43.2% pts. $421.81 1.0%

W Hotels $61.39 -71.0% 26.4% -49.8% pts. $232.58 -16.3%

Composite US & Canada Luxury^1 $100.24 -62.8% 28.3% -48.1% pts. $353.74 0.2%

Marriott Hotels $42.75 -72.1% 24.8% -51.6% pts. $172.19 -14.0%

Sheraton $39.58 -75.2% 23.1% -54.5% pts. $171.35 -16.7%

Westin $47.40 -71.9% 26.4% -51.0% pts. $179.43 -17.6%

Composite US & Canada Premium^2 $42.79 -72.2% 24.5% -52.0% pts. $174.49 -13.3%

US & Canada Full-Service^3 $54.15 -69.4% 25.3% -51.2% pts. $214.24 -7.3%

Courtyard $35.37 -65.2% 31.0% -40.4% pts. $114.12 -20.0%

Residence Inn $64.90 -49.0% 47.8% -31.2% pts. $135.80 -15.8%

Composite US & Canada Limited-Service^4 $43.49 -60.3% 35.6% -38.6% pts. $122.26 -17.3%

US & Canada - All^5 $50.73 -67.3% 28.6% -47.2% pts. $177.48 -13.4%

Comparable Systemwide US & Canada Properties

Twelve Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Brand 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

JW Marriott $69.92 -65.8% 27.1% -49.8% pts. $257.79 -3.1%

The Ritz-Carlton $126.72 -58.8% 30.3% -44.0% pts. $417.81 1.0%

W Hotels $61.39 -71.0% 26.4% -49.8% pts. $232.58 -16.3%

Composite US & Canada Luxury^1 $92.40 -63.5% 28.2% -47.9% pts. $327.83 -1.3%

Marriott Hotels $42.11 -67.7% 27.5% -45.5% pts. $153.17 -14.3%

Sheraton $36.08 -68.8% 28.0% -44.4% pts. $128.83 -19.3%

Westin $47.64 -68.3% 28.5% -46.9% pts. $167.35 -16.0%

Composite US & Canada Premium^2 $43.89 -67.2% 28.1% -45.4% pts. $156.38 -14.2%

US & Canada Full-Service^3 $49.28 -66.5% 28.1% -45.7% pts. $175.49 -12.0%

Courtyard $41.05 -59.5% 36.5% -35.4% pts. $112.51 -20.2%

Residence Inn $66.92 -42.9% 54.7% -23.8% pts. $122.33 -18.1%

Fairfield by Marriott $40.15 -50.9% 41.9% -28.9% pts. $95.78 -17.2%

Composite US & Canada Limited-Service^4 $47.60 -52.1% 43.4% -30.2% pts. $109.80 -18.7%

US & Canada - All^5 $48.28 -59.4% 37.2% -36.5% pts. $129.96 -19.4%

^1 Includes JW Marriott, The Ritz-Carlton, W Hotels, The Luxury Collection, St.Regis, and EDITION.

^2 Includes Marriott Hotels, Sheraton, Westin, Renaissance, AutographCollection, Delta Hotels, Gaylord Hotels,

and Le M?ridien. Systemwide also includes Tribute Portfolio.

^3 Includes Composite US & Canada Luxury and Composite US & Canada Premium.

^4 Includes Courtyard, Residence Inn, Fairfield by Marriott, SpringHill Suites,TownePlace Suites, Four Points, Aloft, Element,

and AC Hotels by Marriott. Systemwide also includes Moxy.

^5 Includes US & Canada Full-Service and Composite US & Canada Limited-Service.

MARRIOTT INTERNATIONAL, INC.

KEY LODGING STATISTICS

In Constant $

Comparable Company-Operated International Properties

Twelve Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Region 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

Greater China $49.77 -41.4% 46.7% -22.3% pts. $106.60 -13.5%

Rest of Asia Pacific $42.23 -64.2% 31.3% -42.8% pts. $135.09 -15.1%

Asia Pacific $46.32 -53.7% 39.6% -31.7% pts. $116.90 -16.7%

Caribbean & Latin America $52.55 -60.0% 26.7% -37.8% pts. $196.51 -3.6%

Europe $34.88 -76.8% 20.8% -53.3% pts. $167.70 -17.3%

Middle East & Africa $48.97 -52.1% 34.9% -32.9% pts. $140.34 -6.8%

International - All^1 $44.77 -60.6% 33.8% -37.0% pts. $132.56 -17.4%

Worldwide^2 $47.53 -64.3% 31.4% -41.7% pts. $151.51 -16.7%

Comparable Systemwide International Properties

Twelve Months Ended December 31, 2020 and December 31, 2019

REVPAR Occupancy Average Daily Rate

Region 2020 vs. 2019 2020 vs. 2019 2020 vs. 2019

Greater China $48.72 -42.4% 45.9% -22.6% pts. $106.19 -14.0%

Rest of Asia Pacific $44.41 -62.3% 32.1% -41.7% pts. $138.45 -13.3%

Asia Pacific $46.51 -54.2% 38.8% -32.4% pts. $119.89 -16.0%

Caribbean & Latin America $38.81 -63.4% 24.4% -37.4% pts. $159.12 -7.1%

Europe $32.53 -75.1% 21.7% -51.2% pts. $149.58 -16.5%

Middle East & Africa $46.27 -52.5% 34.3% -33.2% pts. $134.87 -6.5%

International - All^1 $41.51 -62.2% 31.5% -38.5% pts. $131.63 -16.1%

Worldwide^2 $46.28 -60.2% 35.5% -37.1% pts. $130.40 -18.5%

^1 Includes Asia Pacific, Caribbean & Latin America, Europe, and Middle East &Africa.

^2 Includes US & Canada - All and International - All.

MARRIOTT INTERNATIONAL, INC.

NON-GAAP FINANCIAL MEASURES

ADJUSTED EBITDA

($ in millions)

Fiscal Year 2020

First Second Third Fourth Total Quarter Quarter Quarter Quarter

Net income (loss), as reported $ 31 $ (234) $ 100 $ (164) $ (267)

Cost reimbursement revenue (3,797) (1,202) (1,789) (1,664) (8,452)

Reimbursed expenses 3,877 1,241 1,683 1,634 8,435

Interest expense 93 127 113 112 445

Interest expense from unconsolidated joint ventures^ 3 1 12 8 24

(Benefit) provision for income taxes (12) (64) 27 (150) (199)

Depreciation and amortization 150 72 53 71 346

Contract investment amortization 25 21 48 38 132

Depreciation classified in reimbursed expenses 26 27 27 29 109

Depreciation, amortization and impairments from unconsolidated joint ventures 7 16 3 78 104

Stock-based compensation 41 50 49 57 197

Restructuring and merger-related (recoveries) charges (2) 6 1 262 267

Loss on asset dispositions - - - 6 6

Adjusted EBITDA ** $ 442 $ 61 $ 327 $ 317 $ 1,147

Change from 2019 Adjusted EBITDA ** -46% -94% -64% -65% -68%

Fiscal Year 2019

First Second Third Fourth Total Quarter Quarter Quarter Quarter

Net income, as reported $ 375 $ 232 $ 387 $ 279 $ 1,273

Cost reimbursement revenue (3,756) (3,903) (3,952) (3,988) (15,599)

Reimbursed expenses 3,892 4,107 4,070 4,370 16,439

Interest expense 97 102 100 95 394

Interest expense from unconsolidated joint ventures 2 1 3 2 8

Provision for income taxes 57 82 140 47 326

Depreciation and amortization 54 56 52 179 341

Contract investment amortization 14 15 16 17 62

Depreciation classified in reimbursed expenses 30 29 33 29 121

Depreciation and amortization from unconsolidated joint ventures 7 8 5 9 29

Stock-based compensation 40 50 47 49 186

Gain on asset dispositions - - (9) (134) (143)

Restructuring and merger-related (recoveries) charges 9 173 9 (53) 138

Adjusted EBITDA ** $ 821 $ 952 $ 901 $ 901 $ 3,575

** Denotes non-GAAP financial measures. Please see pages A-13 and A-14 forinformation about our reasons for providing these alternative financialmeasures and the

limitations on their use.

MARRIOTT INTERNATIONAL, INC.

EXPLANATION OF NON-GAAP FINANCIAL AND PERFORMANCE MEASURES

In our press release and schedules, and on the related conferencecall, we report certain financial measures that are not required by,or presented in accordance with, United States generally acceptedaccounting principles ("GAAP"). We discuss the manner in which thenon-GAAP measures reported in this press release and schedules aredetermined and management's reasons for reporting these non-GAAPmeasures below, and the press release schedules reconcile the mostdirectly comparable GAAP measure to each non-GAAP measure that werefer to. Although management evaluates and presents these non-GAAPmeasures for the reasons described below, please be aware that thesenon-GAAP measures have limitations and should not be considered inisolation or as a substitute for revenue, operating income/loss, netincome/loss, earnings/loss per share or any other comparableoperating measure prescribed by GAAP. In addition, we may calculateand/or present these non-GAAP financial measures differently thanmeasures with the same or similar names that other companies report,and as a result, the non-GAAP measures we report may not becomparable to those reported by others.

Adjusted Operating Income/Loss and Adjusted Operating Income/LossMargin. Adjusted operating income/loss and Adjusted operatingincome/loss margin exclude cost reimbursement revenue, reimbursedexpenses, restructuring and merger-related charges (recoveries), andnon-cash impairment charges. Adjusted operating income marginreflects Adjusted operating income/loss divided by Adjusted totalrevenues. We believe that these are meaningful metrics because theyallow for period-over-period comparisons of our ongoing operationsbefore these items and for the reasons further described below.

Adjusted Net Income/Loss and Adjusted Diluted Earnings/Loss PerShare. Adjusted net income/loss and Adjusted diluted EPS reflect ournet income/loss and diluted earnings/loss per share excluding theimpact of cost reimbursement revenue, reimbursed expenses,restructuring and merger-related charges (recoveries), non-cashimpairment charges, losses and gains on asset dispositions, theincome tax effect of these adjustments, and the income tax benefitarising from audit closures. We calculate the income tax effect ofthe adjustments using an estimated tax rate applicable to eachadjustment. We believe that these measures are meaningful indicatorsof our performance because they allow for period-over-periodcomparisons of our ongoing operations before these items and for thereasons further described below.

Adjusted Earnings Before Interest Expense, Taxes, Depreciation andAmortization ("Adjusted EBITDA"). Adjusted EBITDA reflects netincome/loss excluding the impact of the following items: costreimbursement revenue and reimbursed expenses, interest expense,depreciation (including depreciation classified in "Reimbursedexpenses," as discussed below), amortization, impairments fromunconsolidated joint ventures, and benefit (provision) for incometaxes, restructuring and merger-related charges (recoveries),stock-based compensation expense, and losses and gains on assetdispositions for all periods presented. When applicable, AdjustedEBITDA also excludes gains and losses on asset dispositions made byus or by our joint venture investees.

In our presentations of Adjusted operating income/loss and Adjustedoperating income/loss margin, Adjusted net income/loss, Adjusteddiluted EPS and Adjusted EBITDA, we exclude charges incurred underour restructuring plans that we initiated beginning in the 2020second quarter to achieve cost savings in response to the decline inlodging demand caused by COVID-19 and transition costs associatedwith the Starwood merger, which we record in the "Restructuring andmerger-related charges (recoveries)" caption of our IncomeStatements, to allow for period-over period comparisons of ourongoing operations before the impact of these items. We also excludenon-cash impairment charges related to our management and franchisecontract, operating lease, and equity investment assets, which werecord in the "Contract investment amortization," "Depreciation,amortization, and other," and "Equity in earnings (losses)" captionsof our Income Statements to allow for period-over period comparisonsof our ongoing operations before the impact of these items. Weexclude cost reimbursement revenue and reimbursed expenses, whichrelate to property-level and centralized programs and services thatwe operate for the benefit of our hotel owners. We do not operatethese programs and services to generate a profit over the long term,and accordingly, when we recover the costs that we incur for theseprograms and services from our hotel owners, we do not seek amark-up. For property-level services, our owners typically reimburseus at the same time that we incur expenses. However, for centralizedprograms and services, our owners may reimburse us before or afterwe incur expenses, causing timing differences between the costs weincur and the related reimbursement from hotel owners in ouroperating and net income. Over the long term, these programs andservices are not designed to impact our economics, either positivelyor negatively. Because we do not retain any such profits or lossesover time, we exclude the net impact when evaluatingperiod-over-period changes in our operating results.

We believe that Adjusted EBITDA is a meaningful indicator of ouroperating performance because it permits period-over-periodcomparisons of our ongoing operations before these items andfacilitates our comparison of results before these items withresults from other lodging companies. We use Adjusted EBITDA toevaluate companies because it excludes certain items that can varywidely across different industries or among companies within thesame industry. For example, interest expense can be dependent on acompany's capital structure, debt levels, and credit ratings.Accordingly, the impact of interest expense on earnings can varysignificantly among companies. The tax positions of companies canalso vary because of their differing abilities to take advantage oftax benefits and because of the tax policies of the jurisdictions inwhich they operate. As a result, effective tax rates and provisionsfor income taxes can vary considerably among companies. Our AdjustedEBITDA also excludes depreciation and amortization expense which wereport under "Depreciation, amortization, and other" as well asdepreciation classified in "Reimbursed expenses" and "Contractinvestment amortization" in our Consolidated Statements of Income(our "Income Statements"), because companies utilize productiveassets of different ages and use different methods of both acquiringand depreciating productive assets. Depreciation classified in"Reimbursed expenses" reflects depreciation of Marriott-ownedassets, for which we receive cash from owners to reimburse thecompany for its investments made for the benefit of the system.These differences can result in considerable variability in therelative costs of productive assets and the depreciation andamortization expense among companies. We exclude stock-basedcompensation expense in all periods presented to address theconsiderable variability among companies in recording compensationexpense because companies use stock-based payment awardsdifferently, both in the type and quantity of awards granted.

MARRIOTT INTERNATIONAL, INC.

EXPLANATION OF NON-GAAP FINANCIAL AND PERFORMANCE MEASURES

RevPAR. In addition to the foregoing non-GAAP financial measures, we presentRevenue per Available Room ("RevPAR") as a performance measure. We believeRevPAR is a meaningful indicator of our performance because it measures theperiod-over-period change in room revenues for comparable properties. RevPARrelates to property level revenue and may not be comparable to similarly titledmeasures, such as revenues, and should not be viewed as necessarily correlatingwith our fee revenue. We calculate RevPAR by dividing room sales (recorded inlocal currency) for comparable properties by room nights available for theperiod. We do not consider interruptions related to COVID-19 when determiningwhich properties to classify as comparable. We present growth in comparativeRevPAR on a constant dollar basis, which we calculate by applying exchangerates for the current period to each period presented. We believe constantdollar analysis provides valuable information regarding our properties'performance as it removes currency fluctuations from the presentation of suchresults.

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SOURCE Marriott International, Inc.