Good morning. Good morning. Are we good? Okay, we're gonna kick things off. I am very excited to have the CFO of Marriott here, Leeny Oberg, in town for not only this, but their Christmas, their annual Christmas party later this week. Exactly. Which is famous for tiny cupcakes. Right? Right. They're great. Okay. See, I just got my hopes up. I was gonna say, every year we, you know, try to come up with something new. I don't know. Delicious. There were a couple of years with the mini cupcakes, and my wife now knows... It's on the calendar. 'Cause she knows I bring home... It's gonna be even better. Okay, IR, Jackie Burka over here in the front seat, and Betsy Dahm, thanks so much for being here. There's a lot to celebrate this year so- There is a lot to celebrate. - should be good. Okay. All right. Well, the expectations are not high. I'm just kidding. They're very high. Okay. First question, macro demand question to get it out of the way. Sure. The three major demand segments, leisure, corporate transient, group, can you talk about, you know, those three segments in the context of the broader recovery and those, and the momentum within those segments, and how you view, the current, you know, sort of the current backdrop for those segments right now? Sure. Well, first of all, Brandt, thank you for having me. It's great to be here. Great to see you in this role. It's terrific. We could take that question and probably spend the whole time on it, so we'll try to whip through it because there's a lot to cover there. As we've talked about, we've been really pleased with the resilience of demand and the strength of it across the business segments, albeit with business transient a bit behind the others, but still improving. We look, for example, at the month of October, and despite the reality that we clearly have an uncertain macroeconomic environment as we move into 2023, we continue to see really strong demand. For example, when you think about RevPAR for the company system-wide, worldwide for Q3 was 1.8% above 2019 levels. The month of October was 3%, and you saw, for example, U.S. and Canada, which was 3.5% for Q3, was actually close to 5%. You saw international improve by about a point, still below 0, but that's with the reality that China in the month of October was meaningfully worse than Q3 because of the COVID shutdowns. Kind of across the board, we continue to see the kind of the power of people's love for travel, pent-up demand, pent-up savings, recovery in certain markets. Asia Pacific outside of China, for example, continues to make great progress. Europe also just absolutely screaming with the weaker pound and euro. When I go into the segments, you know, leisure has obviously been the star of the show over the past year and a half, and again, we continue to see strength in Q3, even over the powerful summer of 2021, where we continued to see leisure business really strong. I'll give you a statistic for Thanksgiving week. RevPAR was actually up 15% Thanksgiving week in U.S. and Canada, and that is with occupancy only being down 4 points and rate making up more than making up the difference at 19% over 2019 levels. While, of course, we'd love to see occupancy get back to the 2019 levels, if you remember in Q3, you actually had occupancy more like 6 points down compared to 2019. Again, really nice continued momentum across the board. On group business, continue to pace 4% above 2019 levels for Q4. I think with all the in the quarter, for the quarter bookings, you could actually see that end up even a little bit better. As you look at the rate component of that, it's continues to be very strong on the group side, which is a good reminder that right now, groups are basically being willing to trade flexibility for price. We see that trend continuing, which I know you're gonna wanna talk about kind of how we see things next year, and that's one of the elements that does make things a bit uncertain just because there's so much more in the year for the year bookings. On the business transient side, as we've talked about before, it does continue to improve, albeit still meaningfully behind 2019 levels. When you look at the smaller, non-negotiated corporate rates, that business is back. That business actually in Q3 was 10% above 2019 levels. Your classic, small company salespeople, e-engineers out working on a project that are, frankly, often in secondary and tertiary markets, that business is absolutely back and shows good economic activity. I think it is the special corporate accounts where we continue to see that while it is improving, it is still meaningfully behind 2019 levels. Some of that obviously is related to a bit of the way people are working, where, for example, the, call it 20- to 30-year-olds are perhaps able to work more in a hybrid fashion. What we are hearing from the special corporates at the senior level, at the so-called, consulting or investment bank, partner levels or MD levels, that business is back, that those nights are back. Obviously, you're seeing really strong rate in the upper end of our properties, and I think that helps reflect that demand. Okay. Wow. Ask me where you would like to fill in where I didn't cover. That was such a great introductory, I mean, that could have been the whole fireside right there. We can go now. No. You've mentioned 2023, and I would like to dig in a little more on how you're thinking about 2023 from the angle at least, where you have easy comparisons, right? Right. I think- Right -the crux of your call and Hilton's call a month ago was that you're both looking for some level of growth- Right - in 2023 year-over-year. Would you unpack where the growth is coming from occupancy versus rate or where across the segments or regions? Let's do the easy ones first, and then we'll get to where there's the heightened uncertainty. Obviously, the easy one is Q1. No matter pretty much where you look across the board, you saw Omicron have a huge impact. You can already start to see in January when you start to look at little bits and pieces of the bookings. You can see that already is showing much more of a normal pattern. You'll be hearing us talk about comparisons of 2023 to 2022 going forward- Okay. -kind of, I think the world of 19- The times. The world of 2019 now seems, it's like when we talk about the first year we acquired Starwood, which now you realize that was, you know, more than five years ago. You kinda gotta move on to the future. I do think that the easy comparison will really be quite a, quite a global benefit, and a big one, right? I mean, we were down almost 20% last year, I mean, this current year in Q1 from compared to 2019, that obviously is pretty easy. You've got other areas of the world, which also are seeing easier comparisons because of their really not great comfort in travel in chunks of this year. You know, by the time you got to the summer, you were seeing a lot of it open up. Asia-Pacific outside of China, for example, we continue to see steady improvement, but that was still down in Q3. That was still down 15% compared to 2019 levels. That, I think you'll continue to see Japan, India, Australia, all of those markets really starting to open up and see more international and domestic demand. Put the easy ones aside. I think that should encourage you that there is a good opportunity on both occ and the rate side, throughout the year for those two components. I think the harder one, as we all sit and watch what's going on in the economy, is the classic ones related to fundamental macroeconomic conditions. The booking window is still short on the transient side, still, you know, three weeks-ish. That means that things could turn on a dime. At the same time, I think we've got some factors that help our industry in a way relatively more than some others. I think you've still got pent-up demand, desire for experiences over goods. Still this feeling of, I really didn't like being pent up in my four walls at home, and if there's one thing I'm gonna do because I can do, it's travel. I do think the greater hybrid work environment, when I look out there, at airports and, when I'm traveling all over, you see it in the airports, in quite not the huge lumps that it used to be about weekend versus weekday. And we see it in our occupancies for day of the week. That's where, again, I think general economic activity obviously, will have an impact, but I think we've got some of these factors that can help mitigate that part for us, that could make it, to the extent it happens, could make it a softer impact. And within that group- Yes -which seems to be maybe the brightest of the stars, not necessarily in what it's run rating at, but what it could do- Right - in the future, and that's part of the pent-up demand story. Yes. You know, I guess the question is, comparing this to the last cycle when I think everything just got canceled in 2009. Right. Groups just, you know, companies canceled their groups, all the conventions, or some of the conventions, as the corporate related ones, at least. You know, how is it gonna be different this time? This is again why I find it interesting. Every recession is different, or every cycle is different. It is the case that group behaved a little bit better than transient. They were both down meaningfully, to be fair, in the Great Recession. It isn't that big a difference between transient and group. I think a couple factors are different. I think group is now more in the year for the year, which will make it a little bit easier for people to alter their plans. We're now seeing 50% of our group in a year for the year. That used to be 25%. Oh, wow. Okay. That's one element. I think the other one is that cancellation fees are never fun to pay. One way that a company can adjust their group is to basically take fewer people. Say, you know, we used to look at both groups canceled, but also attrition, i.e., if a group was supposed to have 600 nights and they ended up only having 500 because not as many people came. That's where I think you could see how they play. Again, I also would look a little bit at behavior differences. That is that I think, in some respects, organizations are using group now as a way to shore up culture, training, relationships, development of their people. In some respects, it may become a bit more required than, oh, I'm gonna give a great big bang for my salespeople 'cause they had a great year. I think some of this will be interesting to watch 'cause I think there is some fundamental desire to make sure that we keep the kind of the tightness of the organization moving forward because people aren't working in the office quite as much. I think if you look, you know, Ryman, when they put out their occupancy, you can basically see that Gaylord is really, their occupancy has recovered beautifully. Again- You helped. Absolutely. I think that's where you see this desire on the part of organizations to say, "You know what? We've got to make sure that we're keeping the company's culture moving forward," that may actually make some of that group business be even a little bit stickier- Mm-hmm. -during a downturn. Remember, the, you know, the Great Recession was a downturn that was not, you know, like a, you know, like the recession of even 2001. I mean, it was deep and, broad. Mm-hmm. To some extent, extremely worrisome as people were looking at the U.S. financial system, which was, at that point, in peril. That's really not where we are. There again, I think there is a greater degree of comfort in the stability of kind of the economic underpinning, if you will, that again could also help moderate what we see. Okay. On the leisure side, looking into next year, or at least just from going forward from right now, and you have a dominant position in leisure, it's not lost on us. The question that I get is, you know, oh my gosh. Where does it stop? It's so expensive to go on a big, nice family vacation. I think a lot of investors are concerned about rate compression at the high end on the leisure side, just because, you know, everyone needs to go on a vacation, and they wanna go on a vacation. Maybe there's been a shift, but maybe they were going on, I don't know, 15 vacations in 20 and 21. They don't need to go on 15, they can go on 10. Right, right. The numbers are crazy. That's not what I do, by the way. Anyway, you know what I mean. I was gonna say, it's kind of interesting. Saturday day trips count, so. Hey, again, bleisure now. You can go work anywhere. Well, that you touched on that. That's sort of part of it, I guess. Answer it, I guess, in any way you want. Yeah. Well, I think it depends very much on the sector. I agree with you that there has been some pent-up revenge travel. I also think there are some fundamentals that are gonna change next year that are gonna help us on the rate side that we haven't had the benefit of over the past two years. You know, one of them is special corporate rates, for example. We rolled over rates for two years. We're now obviously in that process of renegotiating those rates. We've talked about feeling pretty comfortable that you could see an increase in rates on special corporate that are high single digits increase. I think that in and of itself, if you think about it, can be a nice boost. There is room in occupancy. That is the other part. You know, we are 10% of our rooms are luxury. 10% of our pipeline is also luxury. While, frankly, many of you in this room probably have been feeling that pain as you look at trying to book your vacations, the reality is that we have 30 brands that are across many, many price points. When you look at the overall RevPAR, I think you could see that it's while there could be some softening of the increase over the kinds of incredible rates of increase that we saw this year, that there are other areas that can offset that. The other part is just recognizing that there is fundamentally this desire to travel, that I think while somebody could choose, maybe they aren't going to Dorado this time, maybe they're gonna go to Half Moon Bay, etcetera, where, you know, they're both extraordinary, but one was really extraordinary this year versus another. There is still very much a desire to get out there and that life is short. Life is short. I guess the follow-up to that is, your franchisees are in charge of their pricing, and you give them tools- Right. -to do a good job with that. Comparing back to 2009, if it's the relevant comparison, but, you know, is there anything different about the tools they have or the structure of the industry now versus 15 years ago where you think they'll act a little differently? Yes, I do. I think COVID, right, we've all learned a lot from COVID. I think everything from people's comfort with digital commerce and really doing so much of their shopping, booking, exploration online, that's just one example, to the reality that kind of as you think about what was going on in the Great Recession, it was very much just beds and heads, and heads and beds. Heads and beds. Sorry. Heads and beds. I think there's been some real lessons learned during COVID about, at some point, occupancy is really not as attractive as making sure that what demand you do go after, you do the best you can to maximize that revenue. I think all participants in the industry have learned that. I think the other thing is to remember back in the Great Recession, we didn't have the consistency of pricing that we have today. If you remember back then, we had Travelocity, Expedia. There was much more of an ability to, frankly, get heads in beds through deep discount pricing. Through a lot of very hard work in the industry, we've basically gotten to where there is much more consistent pricing for our consumers so that they don't have to worry that depending on where they go, they're gonna get consistent pricing. That also is very helpful. Now, to your point, there is still the reality that our franchisees all make their own decisions. I think generally, the industry has taken some learnings from COVID that will make the focus on rate to be better than it has ever been in the past. Demand is demand. Obviously, if you have a sharp recession, you know, if the Fed raises rates so quickly that then all of a sudden things, you know, dive quickly, obviously, you know, we are a cyclical business. I will never say that we don't feel the impact of a cycle. I think the chasing OCC element is a bit different than it used to be. Chasing OCC when labor maybe is harder to flex up- Right, right. -might be a little bit of a different world now. I wanna ask about that. Where is your system in terms of the staffing up effort? How is cost inflation trending against that, if it's cooling off at all? Then, sorry, this is a three-parter. Then, I can't remember. Now I gotta remember. Sorry. Well, now I just caused a delay, so we should probably just start it over. The last question is about service levels. Right. That's been a topic, I thin-- Right -in terms of people having trouble with towels, I guess, is- Right -the headline. First is the shift towards more leisure, and that obviously has meant that our hotels need to be even more focused on making sure that they're delivering on the service promise that we have because we're not naive in thinking that at the end of the day, it is the experience with our associates on property that is what brings people back to Marriott International's 30 brands. For all of us at the company, that is a huge emphasis as we really come into full recovery. No doubt, 2021 was. It was a real challenge, right? You were having this incredible increase in demand, people dying to get out and about, and a real challenge in getting enough people on property to take care of the guests. That has moderated. While we still have more open positions than we had in 2019, it is meaningfully better than it was in 2021. I think we've seen our guest satisfaction scores, you know, increase meaningfully from 2021, and, you know, it won't surprise you, we're incredibly focused on it across all the range of the tiers. Labor is still a challenge in terms of filling the jobs as fast as we'd like, but it is meaningfully better, and the wage pressures have also moderated. There clearly, you know, inflation is much higher, and wage rates dramatically higher than 2019, and in general, have outpaced inflation in the U.S. and Canada anyway. We are seeing that come into line, where it is much closer now to being like inflation, and a steadier stream of applicants. you know, also with the reality that we're doing things differently. We're allowing much more flexibility in our associate scheduling patterns, the ability to kind of choose maybe a four-day workweek instead of a classic five-day workweek that is always 7:00 A.M. to 3:00 P.M. you know, we're doing our bit as well to demonstrate the attractiveness of working for us as well as the career opportunities, which frankly are quite different from some of your classic hourly positions. It's moving in the right direction. I would say we're not back yet, and there is obviously the industry did suffer with kind of people worrying about COVID. But as you think about people's concerns about a possible recession, I think that also encourages the workforce to be thoughtful about hop, skipping, and jumping every six months. Okay. That's helpful. Okay. Switching or moving over to development. You guys lowered your net unit growth guidance by 50 bips, and you said that basically that China, more complex properties in China and China in general, and just the supply chain or the delays in China is sort of what was the cause of that. I guess the question is, you know, and your peers are saying the same thing, of course, is the China construction pipeline, is the whole thing being pushed back? Or is this a situation where what was gonna open this year is just gonna open next year instead? The pace of the opening up of large cities in Greater China, I think, is still quite uncertain. The good news is that these projects are not being canceled. They are continuing to move forward. We're not seeing them fall out of the pipeline. We do expect them to open. We're in the middle of budget season at the moment in terms of trying to predict exactly when all of this happens and rolls through. I can't give you specifics about whether they all fall into 2023 or whether it's kind of moves everything out a bit, and we'll be able to give more color on that before long. I will say some of this depends very much on the situations in Greater China. As you know, we have a pipeline that is, roughly speaking, right now, our hotels right now in Greater China are roughly 75% full service, 25% select service. You can see that these properties are generally larger, more urban, more complex. You can see how supply chain or the shutdown of a city could have tremendous impact on the construction of one of those hotels. Frankly, the finishing of it, the permitting of it, getting all the workers on property and trained, all of that gets delayed when you have a city just absolutely shut down. To some extent, they're shutting down, opening up, shutting down, opening up, shutting down. That also adds to the challenge of the timing. I think we feel great about these projects still happening. absolutely no sense that they're dropping away. We do expect China to open back up and see it rebound very quickly like it did in 2020. At the same time, it's hard to tell, especially in these large markets. Okay. Over in the U.S. on starts, that actually seems to be a better story, at least what we saw in the- Right - 3Q, it seemed to bottom. I guess the question is, you know, can you unpack why that's bottoming at a time where interest rates are really high? Is there a, you know, a level that the Fed could go to where it breaks down or that dynamic breaks down, and we have a little bit of a double dip, or I guess it's demand dependent? Right. You know, these properties take a while to build and come online. You know, they can be anywhere from, you know, classically two years for a limited service property up to as much as four years for a full service property. I can remember working on the pro forma for the NoMad Ritz-Carlton, which opened up in 2022. I don't know if you know, down on 29th and Broadway. Absolutely spectacular, gorgeous Ritz-Carlton Hotel. I was working on that pro forma in 2013 and 2014. Obviously with COVID, it delayed some of the finishing of the construction. These large urban projects are complicated and take a while. In the U.S., we've definitely seen a rebound in the construction starts, although we are clearly still not back up to the peak levels of construction starts, which are overwhelmingly limited service hotels for us in the U.S. We're not back yet, but have seen a really nice ramp up this year. To your point about interest rates, we've also seen fabulous signings this year. It really around the world, but U.S. and Canada has had a great year in terms of signings of new deals. I think it points out that developers are looking longer term than just looking at the next three years. While some projects are clearly impacted right now by the financing, I would say tightness, where it is both expensive and it's tighter. I mean, there's no doubt that there's not as much money out there for development projects. You need to be a really strong brand in a proven market, and frankly, a proven developer to be able to get your financing. And you're right, they are at rates that are more expensive. At the same time, when you're looking at the dynamics of travel over a longer term, I would argue our asset class is actually looking better than it was perhaps three years ago, where I don't know if you remember, but you and I would be debating about whether RevPAR was gonna be up 2% or up 2.5%, which is a bit of- Those were- -it was a bit of a different world. -relaxing days back then. I think, the long-term view of developers, on a piece of real estate that they think has really strong demographics, you know, over the long term, I think still wins out. Mm-hmm. Again, we aren't seeing that those deals are falling away. I think it's more of a function of the timing. Remind us what you've said about net unit growth over the next couple of years, if you've given any range or qualitative stats, and then what that assumes with regards to China or conservative versus conservative China- Yeah -aggressive China or conservative U.S. starts, aggressive U.S. starts I guess. You know, I think, I like to be able to be very secure in my point of view. I think for now, we're not willing to say, "Okay, we'll get back to mid-single-digit rooms growth by X year," or, you know, in 2025 or in 2024, et cetera. I think for us, it, it's important to recognize that we do have a bit of a dislocation right now that we're working through, and it's getting better. The timing over the next 12 months or 18 months still has some uncertainty around it. I'm very confident that we will get back there. The signings numbers, the pipeline numbers, the lack of fallout, the continued progress on construction projects and seeing construction starts around the world, give us a lot of confidence. Conversions, as you know, Brandt, have been a real bright spot for us. You've seen, you know, 25% of the kind of in the 20s for both openings and signings for conversions for the company, which I think is a great indicator of the strength of Marriott Bonvoy and of the power of the return model that we're trying to drive for our owners and franchisees. That's obviously something that we expect will continue to help us get back to that 5%. But I'm not ready to peg it yet. Okay. Fair enough. Cash flow, capital return, great story for you, of course. You just raised your dividend. You upped your share repurchase authorization pretty recently. Can you just remind us the target leverage range and how you think about that range in terms of, you know, how sustainable is that range Right -in terms of with a cyclical downturn potential? I'm first gonna deviate for a minute and talk a little bit about our liability structure, 'cause I think it's important to note that kind of going into COVID, we had a heavier weighting of commercial paper. We had shorter weighted average lives on our, on our long-term debt. We have extended those. I expect we will not, while now that we've got our strong BBB across the board from the rating agencies, we do look forward to reentering the commercial paper market. I do not expect it to be at the same levels that it was pre-COVID. That, just as you think about your debt maturities, I think when you consider leverage ratios, that's a helpful component. As we talked about it, we were in fantastic shape at the end of Q3, really at the very bottom end of a strong investment-grade target area. We think of adjusted debt to adjusted EBITDAR of roughly 3-3.5x as being the right place to live. As I said before, so far we've been really moved very quickly down to bottom end. Just a good thing to remember that as we've talked about an adjusted EBITDA expectation this year of something that looks like 3.78, I think is the midpoint of the range. One tick, you know, one-tenth of your leverage ratio is either something like $350 million of debt, or it's about $100 million of EBITDA. It, it actually does give you a fair amount of room to make sure to play. We take all of that into consideration. I think probably one of the most positive things that's come out of COVID for us has been seeing how quickly our stats rebound and that the company's cash flow is just incredibly strong. We're gonna be careful, but we're also gonna drive returns. Okay. Any questions in the audience for Leeny? Thanks so much for- Yeah, no, great to see you. Thank you. Good to see you. Thank you for having me.