Good day, everyone. Welcome to today's Q4 2022 earnings. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and 1 on your touch tone phone. You may withdraw yourself from the queue by pressing star and 2. Please note, this call may be recorded. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Ms. Jackie Burka. Thank you. Good morning, everyone, and welcome to Marriott's fourth quarter 2022 earnings call. On the call with me today are Tony Capuano, our President and Chief Executive Officer, Leeny Oberg, our Chief Financial Officer and Executive Vice President, Business Operations, and Betsy Dahm, our Vice President of Investor Relations. I will remind everyone that many of our comments today are not historical facts and are considered forward-looking statements under Federal Securities laws. These statements are subject to numerous risks and uncertainties, as described in our SEC filings, which could cause future results to differ materially from those expressed in or implied by our comments. Statements in our comments in the press release we issued earlier today are effective only today and will not be updated as actual events unfold. Please also note that unless otherwise stated, our RevPAR, occupancy, and average daily rate comments reflect system-wide constant currency results for comparable hotels and include hotels temporarily closed due to COVID-19. RevPAR occupancy and ADR comparisons between 2022 and 2019 reflect properties that are defined as comparable as of December 31, 2022, even if they were not open and operating for the full year 2019 or they did not meet all the other criteria for comparable in 2019. Additionally, unless otherwise stated, all comparisons to pre-pandemic for 2019 are comparing the same time period in each year. You can find our earnings release and reconciliations of all non-GAAP financial measures referred to in our remarks today on our investor relations website. Now I will turn the call over to Tony. Thanks, Jackie, good morning, everyone. 2022 was a very strong year for Marriott. After achieving global RevPAR recovery in June, we finished the year on a real high note, with RevPAR versus 2019 up 7% in December and up 5% in the 4th quarter. Each quarter saw sequential improvement in global occupancy and ADR compared to 2019. We ended the year with 4th quarter occupancy down just 5 percentage points and ADR up 13%. With Asia Pacific excluding China, or APEC, surpassing pre-pandemic levels in the 4th quarter, all regions except Greater China have now more than fully recovered. It is abundantly clear that people love to travel. Globally, leisure demand has remained robust. In the 4th quarter, leisure transient room nights increased 7% versus 2019, and we continued driving leisure ADR, which rose 22%. Our group business experienced the most meaningful improvement in 2022. In the U.S. and Canada, fourth quarter group revenues increased 10% above the same quarter in 2019. Group revenue for 2023 is already pacing up 20% year-over-year, with room night and rate gains each quarter. Given strong lead generation and increased rate quotes, especially for in the year, fourth year bookings, we expect group revenues this year to strengthen further. In 2022, around half of group room nights were booked in the year, compared to just one-third in 2019. U.S. and Canada business transient demand remained steady from the third to the fourth quarter at around 90% recovery. For 2023, we are pleased to have negotiated special corporate rate growth in the high single digits after holding these rates steady the last two years. Our day of the week trends in the U.S. and Canada continue to point to the blending of business and leisure trips. In the fourth quarter, midweek occupancy was still down mid-single digit percentage points versus 2019, while occupancy on shoulder and weekend nights was down in the low single digits. Additionally, the average length of a business transient trip in the U.S. has risen by more than 20% versus 2019. Rising cross-border travel also helped spur overall demand growth during the quarter, though we believe there's still further upside in 2023, especially now that China's borders have reopened. Guests traveling outside their home country accounted for 16% of transient room nights globally in the 2022 fourth quarter. 1 percentage point higher than the prior quarter, yet still 3 percentage points lower than 2019. With more than 177 million members, our powerful Marriott Bonvoy program has also been a key driver of demand for our hotels and other lodging offerings, and for adjacent products like our Bonvoy co-branded credit cards. Our growing portfolio of credit cards, now in 9 countries following our November card launch in Saudi Arabia, had record global card member acquisitions and card spend last year. Product innovation and engagement with our members remain key focus areas, especially through investments in our Marriott Bonvoy app and other digital products. We have made great gains in contributions from our digital platforms, which are highly profitable channels for our owners, and anticipate many additional enhancements over the next couple of years. In 2022, our mobile app users were up 32% year-over-year, digital room nights rose 27%, and digital revenues climbed 41%. The financing environment for new projects and hotel sales remains challenging, especially here in the U.S., given higher interest rates and uncertainty surrounding a potential economic downturn. However, other industry headwinds, like supply chain disruptions, construction costs, and availability of labor, have improved. Given strong global operating trends, overall developer sentiment improved in 2022, and we had another year of strong signing activity. Our global development team signed franchise and management agreements for nearly 108,000 rooms last year. In addition, upon the anticipated closing of the transaction, the City Express portfolio should add around 17,000 rooms in the moderately priced mid-scale space. We're excited about the opportunity to expand in this segment in the Caribbean and Latin America, or CALA region, as well as in other locations around the world. We also recently announced Apartments by Marriott Bonvoy, a new 1-to-3-bedroom serviced apartment brand that we plan to launch in the upper upscale and luxury segments. We've already received a great deal of initial interest from owners and developers. Momentum in conversions continues, including in multi-property opportunities, thanks to the breadth of our roster of conversion-friendly brands across the chain scales. The meaningful top and bottom-line benefits associated with being part of our portfolio make these brands very attractive to owners. Conversions represented nearly 20% of room signings and 27% of room additions in 2022. We added a total of 394 properties last year, representing more than 65,000 rooms, and grew our industry-leading system 4.4% on a gross basis, or 3.1% net year over year. Excluding the impact from our exit of Russia, our net rooms growth was 3.6%. For 2023, we are forecasting gross rooms growth of around 5.5%, including around 1 percentage point from the anticipated addition of the City Express rooms to our franchise system. Assuming deletions of 1%-1.5%, net rooms could grow 4%-4.5%. I'd like to pivot now and share a few highlights of our recent ESG efforts. ESG is an integral part of our company's culture and strategy, and our company is dedicated to making a positive and sustainable impact wherever we do business. In June, we committed $50 million to support historically underrepresented groups in the journey to hotel ownership through a new program here in North America called Marriott's Bridging The Gap. This program should help us reach our goal of having at least 3,000 diverse and women-owned hotels in our system by 2025. In December, we announced that over 1 million Marriott associates have taken our human trafficking training, which we've also donated to the wider hospitality industry. In terms of workforce diversity and inclusion, our aim is to achieve global gender parity in the company's leadership by 2023 and have people of color hold 25% of US executive positions by 2025. We also continue our work to set science-based emissions reduction targets, with more details expected to come later this year. I am proud of these accomplishments and all that we've achieved in 2022. As we look ahead to full year 2023, there is meaningful uncertainty about global economic growth. Lodging is a cyclical business, and it's not immune to downturns in the macroeconomic environment. To date, however, we have not seen signs of demand softening. Certainly, trends could change relatively quickly given our average transient booking window is around three weeks. A month and a half into 2023, booking demand and pricing remain strong. As Leeny will discuss in her remarks, we're optimistic that global RevPAR will grow year-over-year, even if the global economy softens in the back half of this year. Before I turn the call over to Leeny, I'd like to thank our associates around the world for their hard work and commitment in navigating the last few challenging years and in helping the company achieve these record financial results. I also want to make a couple statements regarding two of my senior team members. I'm sure you saw the news in December that Stephanie Linnartz has been appointed Under Armour's new President and CEO, a role that she'll assume at the end of this month. After a 35-year career with Marriott that has spanned the globe, Craig Smith, our Group President, International, has informed me of his decision to retire from the company later this month. Craig has developed and mentored hundreds of hotel general managers and above property leaders around the world and has helped us meaningfully accelerate the growth of our international business. I want to thank both Stephanie and Craig for their decades of dedication and countless contributions to Marriott. While I will personally miss these two excellent senior executives, I'm proud that we have such an incredibly deep management bench. I look forward to sharing more details about new leadership appointments soon. Let me turn the call over to Leenie. Leenie? Thank you, Tony. With sustained momentum in global RevPAR growth, we reported an outstanding quarter. Gross fees rose 16% and adjusted EBITDA climbed 21% over the 2019 fourth quarter. For the full year, we posted record fees, adjusted EBITDA and adjusted EPS, despite the Omicron variant causing a slow start to the year. In the fourth quarter, RevPAR versus 2019 accelerated nicely from the third quarter in every region except Greater China. Compared to pre-pandemic levels, fourth quarter U.S. and Canada RevPAR increased 5%, aided by 11% growth in ADR. RevPAR in the region versus 2019 improved sequentially from the third to the fourth quarter across all market types, from primary to tertiary and all brand tiers, from luxury to select service. International RevPAR rose 3% above pre-pandemic levels in the fourth quarter, driven by improvements in the comparison to 2019 for both rate and occupancy. In the Middle East and Africa or MEA, RevPAR grew 44%, boosted by the World Cup in Qatar. RevPAR increased 28% in CALA, 7% in Europe and 6% in Asia Pacific except for China. While results in Greater China were again impacted by lockdowns in the fourth quarter, the region reached a major milestone with the new open border policy and the lifting of quarantine requirements in January. It could take time to increase airline capacity and work through passport and visa requests, but we're optimistic about meaningful RevPAR recovery in the region as these issues abate. We saw a huge demand surge in January during the Chinese New Year holiday, with RevPAR for the holiday period nearly in line with 2019. Other regions are also anticipated to benefit from an increase in outbound China travel, especially APEC, where over 40% of room nights in 2019 came from Chinese travelers. In the fourth quarter, total gross fee revenues totaled $1.1 billion, reflecting higher RevPAR, room additions and another quarter of significant growth in our non-RevPAR related franchise fees. Those fees rose 16% year-over-year to $215 million, driven largely by our co-brand credit card fees. Incentive management fees, or IMFs, rose impressively in the quarter, reaching $186 million. IMFs surpassed the fourth quarter of 2019, with IMFs in the U.S. and Canada up nearly 30%. At the hotel level, we remain focused on working closely with our owners and franchisees to deliver superior customer service while containing operating costs. Profit margins at our U.S. managed hotels in the quarter were again higher for the same period of 2019, despite meaningful wage and benefit inflation. Importantly, our guest surveys indicate that customer satisfaction continues to rise. In December, our intent to recommend scores in the U.S. improved for the 10th consecutive month and are now generally in line with 2019 scores. Hiring challenges have moderated and the number of open positions in the U.S. is now below 2019 levels. Our asset-light business model once again generated significant cash during 2022, with net cash provided by operating activities totaling $2.4 billion, double the amount in 2021. Our loyalty program was a modest source of cash before factoring in the reduced payments received from the credit card companies. In 2023, we expect loyalty to again be modestly cash positive before the impact of the final year of reduced payments. Let's talk about our 2023 outlook, the full details of which are in our press release. Note that all RevPAR comparisons will be to 2022. More than one in four hotels that are currently comparable in both 22 and 23 or open for the full year were not open in 2019, making comparisons to that year not really meaningful. I'll start with the first quarter, which we anticipate will benefit from continued strong underlying trends. There is also a meaningfully easier comparison to the year ago quarter when the Omicron variant depressed lodging demand. Halfway through the quarter, bookings across customer segments and geographies are excellent. Momentum is being driven by rising cross-border travel and strong group revenues due to demand and ADR gains. Additionally, business transient revenues are benefiting from higher volumes and our successful special corporate rate negotiations. January global RevPAR rose 52%, with the US and Canada up 43%. We anticipate that first quarter RevPAR could increase 25%-27% in the US and Canada, 47%-49% in international markets, and 30%-32% worldwide. Given short-term booking windows and a significant level of macroeconomic uncertainty, there's less visibility in forecasting the company's financial performance for full year 2023. As a result, we're providing a broad range for full year RevPAR and other key metrics. The high end of the range reflects a relatively steady global economic picture throughout 2023, with continued resilience of travel demand across customer segments and markets. The low end of the range reflects a meaningful softening of the global economy beginning in the second quarter, with worldwide RevPAR roughly flat compared to 2022 in the second half of the year. For the full year, RevPAR in the U.S. and Canada could increase 5%-9%, and international RevPAR could rise 12%-18%, leading to a global RevPAR gain of 6%-11%. The sensitivity of a 1% change in full year 2023 RevPAR versus 2022 could be around $40 million-$45 million of RevPAR-related fees. Total fees for the full year could rise between 6% and 12%, with the non-RevPAR-related component anticipated to rise 4%-7%. Non-RevPAR fee growth is expected to benefit from higher credit card fees resulting from growth in average spend and in the number of cardholders. We expect 2023 G&A expenses of $915 million-$935 million, an annual increase of 3%-5%, but still below 2019 levels. Full year adjusted EBITDA could increase between 5% and 12%, and adjusted EPS could rise 8%-18% above 2022. After three years of meaningfully reduced investment spending, we anticipate 2023 investment spending of $850 million-$1 billion. This includes $100 million for the expected acquisition of the City Express brand portfolio and around $160 million of renovation spending on our own W Union Square Hotel in New York and the Elegant Hotels portfolio in Barbados. These hotels will be terrific representations of our W and all-inclusive brands when completed. We expect to recycle our capital investment in these hotels by selling them with long-term agreements. Spending in 2023 also incorporates higher than typical investment in our customer-facing technology, which is overwhelmingly expected to be reimbursed over time. Our capital allocation philosophy remains the same. We're committed to our investment-grade rating, investing in growth that is accretive to shareholder value, and then returning excess capital to shareholders through a combination of a modest cash dividend and share repurchases. In 2022, we returned $2.9 billion to shareholders. At the end of the fourth quarter, our leverage was at the low end of investment grade targets. For 2023, capital returns to shareholders could be between $2.7 billion and $3.6 billion. Before we open the lines, I too would like to express my gratitude to our incredible team of global associates around the world for their resilience and dedication. Tony and I are now happy to take your questions. Operator? At this time, if you would like to ask a question, please press the star and 1 on your touch tone phone. You may remove yourself from the queue at any time by pressing star 2. Once again, that is star and 1 to ask a question. We will pause for a moment to allow questions to queue. We'll take our first question from Stephen Grambling with Morgan Stanley. Hey, good morning. Thanks for taking the questions. Morning. Morning. Wanted to start off on capital allocation here actually. I guess given the moving parts within the rate environment, how are you thinking about the right leverage ratio and how rate may actually dictate, you know, the outcome in terms of that capital allocation that you were referencing or returning cash to shareholders? Sure. Overall, Steven, as I stated in my comments, we are committed to a strong investment-grade credit rating, and we ended the year in terrific shape. I think you can tell from the range that we gave on RevPAR that we see ourselves being in really good shape this year from a cash flow perspective and earnings perspective that does give us great flexibility in how we think about our investing and our capital return. From an interest rate environment, I think it's more about the overall macroeconomic activity and global growth picture than it is about a specific interest rate. We need to see how it plays out. Being at the very low end of our credit ratio metrics, I think gives us plenty of flexibility to deal with whatever may come. Great. Maybe a little bit of a different follow-up. We've been seeing some volatility in the corporate booking data, on our end, and I guess I'm wondering if you could discuss what you're seeing across large corporate demand versus small and medium-sized business. Perhaps tie this into how it might influence, the strong IMFs that we've been seeing. Sure. As I mentioned in my prepared remarks, the recovery for business transient broadly is still at about 90%. Interestingly, for small-medium-sized companies, which represent about 60%-ish of our total business transient, they were actually up 6% quarter-over-quarter in the fourth quarter. That continues to be strong. We've seen slower, albeit steady recovery from larger companies, but they've got a bit of a ways to go to get back to pre-pandemic levels. Stephen, the other thing I'll add is, I hesitate to call this a trend yet, but it's just worth mentioning that in January, we saw our top special corporate accounts, improve another nine points relative to 19. In the classic areas of accounting and consulting or defense or healthcare, we are continuing to see good progress there, but we are only a month into 23 so far. The last point I would make, Stephen, is just reiterating what I said earlier in the call, and that is, for the last couple years, we've rolled over our special corporate rates. As we went into the negotiating season this year, we felt like we were in a pretty good place, and that really materialized as we saw negotiated special corporate rates in the high single digits. Makes sense. Thank you. Thank you. We'll take our next question from Shaun Kelley with Bank of America. Hi, good morning, everyone. Good morning. Good morning. I wanted to talk a little bit more about sort of the demand side. Obviously we know the visibility is, you know, a little short in the industry from time to time, but obviously, it looks like everything you're seeing coincidentally is pretty strong. Could you help us just unpack a little bit, you know, your January trends look well above STR averages even in North America? Then, you know, so what's kind of powering that? Specifically as we kind of work our way through the year, could you just talk about, you know, a little bit more about what you're seeing on maybe the lead generation side group and how you're underwriting China just to help us kind of bridge, you know, the full year outlook? Yeah, of course, Shaun. Maybe I'll start with group just 'cause that's such a terrific story. You heard the numbers about where we were in the quarter with group revenue, for group in the U.S. and Canada, about 10% ahead of where we were pre-pandemic. When we look into 2023, there's two things I would point to that are really compelling. Number one, we're currently pacing up about 20% year-over-year. Interestingly, that's not just a Q1 phenomenon given the favorable comparisons. We're seeing pretty steady pacing across all quarters in 2023. Secondly, I would remind you that the shorter booking window is not specific to Marriott. We're seeing a little more compressed booking window in group as well. We think there is still meaningful upside to group as we watch in the year for the year bookings materialize during the balance of 2023. I'll jump in on China, Shaun, and that is, well, two things. One, to your point about January being particularly strong. If you remember, Omicron was particularly pronounced right as we got into January, and obviously there's a significantly greater degree of comfort this year as we moved into Q1. I think you saw the momentum that was building in Q4 and really all throughout 2022 continue into January as we saw all parts of the business firing on all cylinders. When you think about China, we saw tremendous leisure demand associated with the Chinese New Year. We are really pleased with the overall pace of demand that we're seeing there. Just to give you a rough sense, you know, we could see in Greater China, we could see that RevPAR for the year, 23 over 22 is over 30% increase. Obviously, the biggest increase will be in the first quarter. Thank you very much. Thanks, Shaun. We'll take our next question from Joe Greff with J.P. Morgan. Good morning, everybody. Morning. Tony, can you talk about what's going on with pipeline signings in China presently and, you know, how much of a, I guess a, of a disruption, whether it be in the first quarter given what's been going on there. When you look back at the fourth quarter and the development pipeline was down a little bit sequentially, there have been, you know, quarters in the last 4 years where it's down sequentially, it doesn't mean anything necessarily. How much of the sequential pipeline in the fourth quarter was explained by disruption in China signings? Sure. Maybe I'll take the second question first. The pipeline tends, as you well know, to ebb and flow quarter to quarter. The statistic I look at related to pipeline that I think is a bit more telling is the 2% year-over-year increase in the pipeline. Obviously, deals come in and out of the pipeline in a year where nearly 30% of our openings were conversions. We've talked in the past about the fact that some conversions never even make it into the pipeline. They get signed and opened, quite quickly. On your first question about China signings, China signings last year were down about 15% from where we were in 2021, and they were down a little more than a third from where we were in 2019. As the borders open, we expect to see meaningful positive impact, certainly on demand patterns, but also on the health and the outlook of our development partners. We would expect an acceleration in deal volume. Joe, the only thing that I'll add is there was the obvious challenges for opening hotels in China, tied to the shutdown in China that impacted permits and getting the teams trained and up and running. From that respect, we certainly saw a few drift from where we had expected them to open in Q4 to open in Q1. I think that was clearly to be expected as they saw the shutdown continue. Again, as things open up, we look forward to them increasing. Thank you. Thanks, Joe. We'll take our next question from Robin Farley with UBS. Great, thanks. My question is on the unit growth outlook, and there's some acceleration embedded in there. You mentioned China obviously is, you know, one of the drivers of that, and I guess the City Express acquisition. Just wondering if you have any other acquisitions in that unit growth guidance, just to clarify that. We do not. Okay, great. Perfect. Thank you. My other question was on City Express, because you've talked about using that to grow in other regions, and I'm curious, you haven't mentioned potentially using it in the U.S. There are others out there sort of looking to grow units in the more limited service segments in the midscale and economy segments, and that hasn't been a big focus for Marriott. I'm just curious if you have any thoughts on those segments and then also sort of, you know, why or why not use the, this new brand that is further down the chain scale than some of your other brands in the U.S., in the U.S. market as well. Thanks. Of course. We are very excited to get over the finish line with City Express. As we outlined when we announced our intent to acquire City, it represents our entry into the midscale segment, which is very exciting. It increases our portfolio significantly in the important and growing CALA region. We expect to grow that brand aggressively across CALA, and we are as we move towards closing that transaction, evaluating the applicability of that brand in other markets around the world. We've not made definitive decisions about when and if we will roll out City Express in other places, but you can rest assured those evaluations and discussions are going on as we speak. I do think if you look at our historical track record of acquisitions, many of those acquisitions initially either strengthened our leadership position or gave us a meaningful foothold in a region where we weren't growing as quickly as we'd like organically. Then over the passage of time, we looked for opportunities to grow that platform more broadly. I think the same strategy will apply to City Express. Oh, great. Thank you. Just one quick follow-up, if I could. Is there anything you would call out with termination fees? You know, is it a big part of the growth in that line item? How does that compare to termination fees sort of pre-pandemic or just anything going on there that you would call out? Thanks. Sure. nothing in particular. They do vary. They can be something related to one hotel or a particular transaction. You know, they vary. We've talked about them before, Robyn. It's kind of varying anywhere from $20 million-$40 million in a particular year. As you saw from our deletions number, apart from Russia, we're really absolutely quite where we typically are. There's nothing particular in that number. Oh, great. Thank you very much. Thanks. We'll take our next question from Richard Clarke with Bernstein. Hi. Good morning. Thanks for taking my question. The first one is on the incentive fees. The incentive management fees seem to have recovered about 10% quicker than the base management fees. In the past you've talked about whether that's a small number of hotels paying a lot of incentive fees, or whether that's becoming a sort of more broad based increase in profitability. Just wondering whether you could comment on what's sort of supporting that outperformance of the incentive fees. Yeah, sure. Absolutely. It just while Q4 was spectacular and we really had a wonderful performance in our incentive fees, the reality is they are still meaningfully lower than they were in 2019. While the rest of our fees have grown quite nicely, our base and franchise fees, as rooms have grown, RevPAR has recovered as well as the non-RevPAR fee growth has increased. When you look at IMFs as a% of total fees compared to 2019, they've actually gone down, and we would expect them to continue to be a little bit lower than they have historically been. They do obviously reflect a little bit riskier fee stream for us than compared to the classic base and franchise fees. When you look at kind of where we are in terms of hotels earning incentive fees, I think there are a couple interesting statistics. That is that in 2022, 61% of our managed hotels earned an incentive fee. That compares to 72% in 2019. In the U.S., 39% of our full-service hotels earned an incentive fee versus 45% in 2019. I don't include MSB because there's a very big difference in the managed limited service hotel portfolio between 2022 and 2019, so it's not as relevant a number. As you know, many of our Asia Pacific incentive fees are not back to 19 levels as a result of their RevPAR recovering a bit later than the U.S. I think we're thrilled with the performance of our operating teams, very proud of the work that they have done, especially given wage increases. I think to one point that you're raising, we're excited about what we see in 23 and the years ahead for the IMF potential for our hotels. Okay. That's great. Just a quick follow-up to someone's question earlier. They referred to acceleration in the net unit growth. If I do the math right, it looks like you did 3.6% ex Russia exit in 2022, and that drops down to 3.5% ex City Express in 2023. Is that correct? If you've got some China hotels moving into this year, where is that slowdown coming from? Again, wanna make sure. We certainly include City Express. When we think about our rooms growth, that's a very important component of how we think strategically about how we're growing around the world. When I think about accelerating rooms growth, that is a part of it. When I think of the timing, we've clearly got the reality that construction starts over the past couple years in the U.S. are having an impact in 23, in particular in the U.S. for room openings. Again, otherwise, with the signings that you heard Tony talking about, we're very enthused about what we see going forward. Conversions have been a big component as well. Understood. Thanks very much. We'll take our next question from Smedes Rose with Citi. Hi, thank you. I just wanted to ask a little bit more about the capital spending in 2023. I know you broke out a couple of the line items. Are you thinking any differently about the way that you allocate, I guess, key money, either for conversions or for developers who are considering their brand options, or anything different there than maybe you've done in the past? No, Smedes, I thought you might ask this question. I definitely think it would be helpful to break it down. If you use kind of, roughly speaking, a midpoint of what I talked about $900 million, and you take out the renovation projects at the W Union Square and Barbados, as well as the $100 million for City Express, you're down to $650 million. You've got higher spend on tech systems that will overwhelmingly be reimbursed to us from the system of call it another $150 million in 2023 that's higher than typical. That then gets you down to $500 million, which is quite similar to this year's $500 million. I think when you think about key money, being, again, in the ballpark of perhaps $200 million-$225 million in 2023, that actually lines up quite well with our historical, kinds of numbers for the growth of the system. As you know, many, many of the deals that we sign do not, require any capital investment on the part of Marriott. I might just build on that, Smedes, by reminding you of an obvious fact, which is, we've shared this in prior analyst days. The deals that we determine we may deploy some measure of Marriott capital, even in the form of key money, tend to drive premium valuations and premium fees, and they tend to be much more heavily weighted to our leading luxury portfolio and some of the upper upscale projects as well. Thanks. Could I just follow up on Robin's question about City Express? Sure. Or just in general, with your largest, you know, I guess, U.S. competitor, you know, making a move in what's being termed premium economy, do you feel that it's important for Marriott to also be in that segment in terms of sort of capturing, you know, I guess, a wider range of customers? I mean, traditionally, you haven't really dipped down below, I guess, we'd call it like upper mid-scale. I mean, I guess sort of thinking strategically, is that something that you need to be more attentive to or maybe not so much? Yeah. I won't comment on our competitors. What I will tell you is our growth strategy broadly is driven by what we hear from the two constituents that are most directly impacted, obviously our guests and our owners and franchisees. What we hear from them loudly and clearly is at the right quality level, entry into mid-scale is of great appeal. An alternative lodging product like Apartments by Marriott Bonvoy is equally appealing to both of those constituents, and that's where our focus lies right now in terms of expanding the portfolio. Thank you. Appreciate it. Sure. We'll take our next question from Patrick Scholes with Truist Securities. Hi. Good morning, everyone. Morning. Good morning. First question, I apologize if I missed this, on your international RevPAR guidance for the first quarter and full year, can you just give us a little more quantification of how you would expect the various international markets to perform regarding or versus those RevPAR ranges you gave, such as. Sure. Europe or Pacific? Thank you. Broadly, you heard us talk about 47%-49% for international in the first quarter. As you think about, kind of around the world, I would expect Asia-Pacific both, APAC in particular outside of China to be meaningfully above that. Greater China, probably, you know, somewhere in that ballpark. You clearly saw that, you know, EMEA will also be, kind of in that very high sort of range, with particularly Europe being a real outlier, very high given where they were a year ago in the first quarter. I think the easiest way to think about it is where Omicron was having the greatest impact is where you'll see these outsized performances. Because for example, a year ago, MEA, the Middle East, was not as impacted by Omicron, so their year-over-year increase will not be as strong. I think one of the messages that we want you to hear is that, you know, in this current environment, when you think about kind of moving from Q4 into Q1, we're still seeing good opportunities for continued strength and growth in occupancy and rates, apart from any normal seasonal variations. Okay, thank you. Just a follow-up question, more of an operational issue. There's a bit of a debate out there whether housekeeping will be coming back. I was at ALIS, and I talked to some of the large managers, and, you know, they're of the belief that housekeeping will be coming back, eventually, on, you know, on a daily type of service. I'm curious what your thoughts are on that amenity. Thank you. Of course. I might repeat myself a little bit in the comment I made earlier about City Express. When we make these sort of operating protocol decisions, we are guided by both the evolving expectations of our guests and the economic realities of our owners and franchisees. Weighing both of those sets of expectations and needs, what we've said is, we will have modified housekeeping protocols by quality tier. In our luxury portfolio, we are essentially back to pre-pandemic full daily housekeeping. In the upper upscale tier, we have daily tidy, so not a full cleaning, but making the bed, changing the terry, emptying the trash, et cetera. In our select service or MSB portfolio, we have an every other day tidy. What we hear from our guests, if you give us optionality, which we do both in the booking path and at check-in, and if you give us something we can count on consistently, you will meet our needs. This blended approach captures a lot of the economics that we created during the pandemic for our owners and franchisees. Okay. Thank you for the color. I'm all set. Sure. We'll take our next question from Dori Kesten with Wells Fargo. Thanks. Good morning, Tony and Leen. Morning. You mentioned higher technology costs this year. We've heard that you have some pretty interesting plans on that front that owners are looking forward to. Can you just walk through what the changes are that we may see over the next several years? I'll start, and give you the investment perspective, and then, I'm sure Tony will jump in. I guess first I would say this is not what I would call one thing. This is really a recognition that we view that the digital experience and the experience for our customers and for our associates, on the systems that they interact with the company as being of critical importance over the next few years, well, really forever. In that regard, we're very excited about the work that we're doing, on our tech systems that really will transform the experience for the mobile app and for our guests as they plan and execute their stays with us. It will also transform the experience for our associates, which is critically important as well as we think about how they take care of our guests, most particularly as they are able to interact with our Bonvoy guests to really address their specific needs. As we look at rolling it out, you've probably seen our announcements of working with several third-party service providers to really transform several of our systems. I also think it's worth noting that. We've already done incredible things on our app, and the experience from the digital communications and platform with our customers and our ability to really address their specific wants and needs has already improved meaningfully, and we expect to build on that. Okay. Thank you. We'll take our next question from David Katz with Jefferies. Hi. Good morning, everyone. Thanks for taking my question. Sure. Hi. I wanted to just look into the owned and leased profit within the guidance versus what you just reported. It looks like it is flattish or down a bit. I just wondered, was there something in 22 that, you know, lifted it up, or are there some... You know, what, if you could help us unpack that a little bit. Sure, absolutely. A couple things, David. I would say, first of all, we do have two really important renovation projects going on in 2023. No surprise, Barbados was crushing it over the past year as you think about leisure demand, and as we really do a very full renovation of these properties, that will have an impact on owned lease profits. I would expect termination fees to be a bit lower as we look at 2023 versus 2022. We had a couple other things that are close to offsetting. If you remember in Q1, in particular of 2022, we had the German subsidies. They hit in Q1 of 2022, and we obviously will not have them in Q1 of 2023. We also had an agreement on a pack of leased U.S. hotels that involved a charge later in the year in 2022, and obviously, we won't have that in 2023. There'll be a little bit between the quarters that moves things around. Those two things largely offset each other. I really would look to both termination fees as well as the issue around renovations. Okay. Perfect. Thank you. As my follow-up, I wanted to just touch on deletions quickly because I and I apologize if it sounds like a negative question. There's just been a lot of discussion about the NUG. This 1 to 1.5 deletions going forward, is that what we should think about as kind of a normal normal course number? That's a good question. I would suggest to you that the 1 and to 1.5 range is more reflective of some of the uncertainty that Leeny described in her remarks, and it resulted ultimately in us providing forward guidance on RevPAR in a wider range than we might historically have offered. Got it. Okay. Thank you very much. Appreciate it. You're welcome. We'll take our next question from Bill Crow with Raymond James. Hey, good morning. I might as well follow up on the NUG question. Assuming no large acquisition repeats in 2023, should we assume that 2024 is back in that kind of 3.5% range? Well, Bill, we were excited to be able to give you some visibility into 23. 24 is probably a little ambitious. What I will tell you, though, is, notwithstanding some of the constriction in the debt markets, we are encouraged that we are seeing incremental acceleration of construction starts, albeit not back to where we were in 2019. We are encouraged by what we experienced both on the signings and openings front in 2022 with conversions and expect that momentum to continue to build both on an individual asset basis and a portfolio basis. Okay. My follow-up question would be on just the operating expense environment in the U.S. If you could just kind of give us a little bit of details on what you're seeing on the labor front, kind of a year-over-year increase and maybe all other expenses or the total expense growth expectation for this year. Thanks. Sure. as you've seen in our numbers, we've given you, the expectation of 3%-5% on the year. That really, as you think about it, reflects, just continuing to, be more and more back in business. So whether it is higher travel expenses or a little bit more, annualization of, positions that we added in 2021 and 2022. Really, other than that, I would say, really quite normal. The wage pressures have moderated, Bill, and we are seeing a more normalized environment, both at the property level as well as above property. Great. Thanks, Leeny. We'll take our next question from Brandt Montour with Barclays. Hey, good morning, everybody. Thanks for taking my questions. Thanks for having me. Yeah. Thank you so much. So maybe starting with you, Leenie, if you could, you mentioned non-RevPAR fees could grow 4%-7%. I was wondering if you would be willing to break that out a little bit and talk about the credit card fee portion, at least in relation to RevPAR growth. What that would imply for residential fees and other. Sure. As you know, residential branding fees are bumpy. They really do vary depending on the timing of the opening of when a building is complete, and people can actually move in and close their sales. They tend to vary. They've gone anywhere from, you know, $40 million-$70 million within a space of 2 years. As you've heard us say, we have a really robust pipeline of residential projects. While I would expect the residential branding fees to be more flattish compared to 2022, that's really just a reflection of timing. When I think about credit card fees, we expect them to increase, both as a combination of a higher number of cardholders, and that's partly in the U.S. and partly from the fact that we've added a bunch of other countries, as well as increased spend. I do think the average spend for an existing cardholder, that growth will moderate in 23 as compared to 22. Those are tied into how I think generally we're seeing the economic view. So for example, that might look more like inflation, while what the wonderful, terrific increase comes from more and more cardholders. That's hugely helpful. Thank you. Just as a follow-up on the development outlook and discussion from earlier, you know, obviously signings sound like they're really strong, Tony had talked about. I'm curious if you could talk a little bit about the segment of the pipeline that's in the planning phases, not just signed, but maybe had been there for a little bit, and not necessarily stale. Just curious if there's a dynamic in that pipeline that you're seeing that's any different than history. No, I don't think so. I mean, maybe the best empirical metric to answer your question is fallout from the pipeline, which would be canceled projects. That's running interestingly, kinda, on pace with what we've experienced historically over a long period of time and with what we were experiencing prior to the pandemic. As Leenie pointed out in response to an earlier question, the move from signed to getting a shovel in the ground, has not accelerated as much as we would like. Again, we're seeing the number of construction starts, particularly in the U.S., moving meaningfully from the bottom of the trough, albeit not quite back to where we were prior to the pandemic. Perfect. Thanks, everyone. Sure. We'll take our next question from Chad Beynon with Macquarie. Good morning. Thanks for taking my question. First, wanted to ask about group pace. Tony, you talked about kind of the movement to in the year for the year, and kind of how that's changed over the past couple of years. As we look out to like 2024, you know, what percentage of rooms are on the books now versus what would normally be on the books this early? Does that kind of affect how you think about, you know, RevPAR outlooks? Thanks. Sure. As I mentioned earlier, the group has been a real bright spot for us and not just looking backwards, but even forward. If you look at what we have on the books for 2024 on the January 1st of 2023, that's about 5% ahead in gross revenue from where we were a year prior, meaning comparing that to what was on the books for 2023 on January 1st of 2022. We are pacing ahead of where we were a year ago, and we are enthused at the prospect of those numbers continuing to expand because of the in the year for the year phenomenon that you described. Okay, great. Something that we'll probably talk a lot more about as we get through 2023, you know, Congress has talked about a reduction in what they call surprise fees. I guess these would in your industry, they could potentially hit some of the resorts on the back end. Can you talk about how your partners are thinking about what would happen if these below the line fees kinda move to above the line, if those would just be included in the rate, or if there could be a difficult transition period if they are banned? Thanks. Well, as you would expect, we listened with great interest to the president's comments during the State of the Union. It appeared, if you listen to what he actually said, his concern was, quote, hidden fees. The manner in which we disclose resort fees or destination fees, combined with the rigorous process we have to approve the implementation of one of those fees and the requirements for a meaningful value proposition before those fees are approved, give us comfort that we have the right strategy. The other thing I would remind you, across our 8,300 hotel portfolio, I think we've got less than 300 hotels that have those sorts of fees. In terms of materiality, it's quite impactful for those individual owners, but less impactful on a portfolio-wide basis. That's helpful. Thank you. Of course. We have reached the allotted time for questions. I will now turn the program back over to our presenters for any additional or closing remarks. Well, I wanna thank you again. These calls are a lot more fun to engage with you as we continue to see empirical evidence of the resilience of travel. We appreciate your thoughtful questions and look forward to seeing you on the road. Thank you. Thank you. That concludes today's teleconference. Thank you for your participation. You may now disconnect.