UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-36243

Hilton Worldwide Holdings Inc.

(Exact name of registrant as specified in its charter)

Delaware	27-4384691
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
7930 Jones Branch Drive, Suite 1100, McLean, VA	22102
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (703) 883-1000

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value per share	HLT	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange

Act. ☐    

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant's common stock, par value $0.01 per share, as of October 21, 2022 was 270,456,017.

HILTON WORLDWIDE HOLDINGS INC.

FORM 10-Q TABLE OF CONTENTS

		Page No.
PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements	2
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	27
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3.	Defaults Upon Senior Securities	28
Item 4.	Mine Safety Disclosures	28
Item 5.	Other Information	29
Item 6.	Exhibits	29
	Signatures	31

1

PART I. FINANCIAL INFORMATION

Item 1.    Financial Statements

HILTON WORLDWIDE HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

	September 30,		December 31,
	2022		2021
	(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	1,282	$	1,427
Restricted cash and cash equivalents	80		85
Accounts receivable, net of allowance for credit losses of $124 and $126	1,278		1,068
Prepaid expenses	139		89
Other	197		202
Total current assets (variable interest entities – $28 and $30)	2,976		2,871
Intangibles and Other Assets:
Goodwill	4,990		5,071
Brands	4,814		4,883
Management and franchise contracts, net	874		758
Other intangible assets, net	158		194
Operating lease right-of-use assets	624		694
Property and equipment, net	254		305
Deferred income tax assets	213		213
Other	605		452
Total intangibles and other assets (variable interest entities – $141 and $184)	12,532		12,570
TOTAL ASSETS	$	15,508	$	15,441
LIABILITIES AND EQUITY (DEFICIT)
Current Liabilities:
Accounts payable, accrued expenses and other	$	1,728	$	1,568
Current maturities of long-term debt	39		54
Current portion of deferred revenues	266		350
Current portion of liability for guest loyalty program	1,332		1,047
Total current liabilities (variable interest entities – $39 and $50)	3,365		3,019
Long-term debt	8,692		8,712
Operating lease liabilities	786		870
Deferred revenues	845		896
Deferred income tax liabilities	794		700
Liability for guest loyalty program	1,251		1,317
Other	689		746
Total liabilities (variable interest entities – $174 and $212)	16,422		16,260
Commitments and contingencies – see Note 12
Equity (Deficit):
Preferred stock, $0.01 par value; 3,000,000,000 authorized shares, none issued or outstanding as of September 30, 2022 and December 31, 2021	—		—
Common stock, $0.01 par value; 10,000,000,000 authorized shares, 332,944,066 issued and 271,541,523 outstanding as of September 30, 2022 and 332,011,359 issued and 279,091,009 outstanding as of December 31, 2021	3		3
Treasury stock, at cost; 61,402,543 shares as of September 30, 2022 and 52,920,350 shares as of December 31, 2021	(5,545)		(4,443)
Additional paid-in capital	10,791		10,720
Accumulated deficit	(5,477)		(6,322)
Accumulated other comprehensive loss	(685)		(779)
Total Hilton stockholders' deficit	(913)		(821)
Noncontrolling interests	(1)		2
Total deficit	(914)		(819)
TOTAL LIABILITIES AND EQUITY (DEFICIT)	$	15,508	$	15,441

See notes to condensed consolidated financial statements.

2

HILTON WORLDWIDE HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share data)

(unaudited)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Revenues
Franchise and licensing fees	$	573	$	451	$	1,531	$	1,062
Base and other management fees	76		49		206		116
Incentive management fees	52		26		132		60
Owned and leased hotels	295		199		727		376
Other revenues	28		18		71		56
	1,024		743		2,667		1,670
Other revenues from managed and franchised properties	1,344		1,006		3,662		2,282
Total revenues	2,368		1,749		6,329		3,952
Expenses
Owned and leased hotels	263		200		705		452
Depreciation and amortization	39		46		123		143
General and administrative	93		107		287		302
Other expenses	13		12		35		31
	408		365		1,150		928
Other expenses from managed and franchised properties	1,337		944		3,589		2,339
Total expenses	1,745		1,309		4,739		3,267
Loss on sale of assets, net	—		(8)		—		(8)
Operating income	623		432		1,590		677
Interest expense	(106)		(98)		(295)		(302)
Gain on foreign currency transactions	—		—		4		1
Loss on debt extinguishment	—		—		—		(69)
Other non-operating income, net	10		6		32		16
Income before income taxes	527		340		1,331		323
Income tax expense	(181)		(100)		(407)		(64)
Net income	346		240		924		259
Net loss attributable to noncontrolling interests	1		1		3		4
Net income attributable to Hilton stockholders	$	347	$	241	$	927	$	263
Earnings per share:
Basic	$	1.27	$	0.86	$	3.35	$	0.94
Diluted	$	1.26	$	0.86	$	3.32	$	0.94
Cash dividends declared per share	$	0.15	$	—	$	0.30	$	—

See notes to condensed consolidated financial statements.

3

HILTON WORLDWIDE HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in millions)

(unaudited)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Net income	$	346	$	240	$	924	$	259
Other comprehensive income (loss), net of tax benefit (expense):
Currency translation adjustment, net of tax of $12, $(2), $18 and $(4)	(22)		(5)		(47)		(26)
Pension liability adjustment, net of tax of $—(1), $(1), $(1) and $(2)	1		2		4		6
Cash flow hedge adjustment, net of tax of $(17), $—, $(46) and $(4)	50		—		137		11
Total other comprehensive income (loss)	29		(3)		94		(9)
Comprehensive income	375		237		1,018		250
Comprehensive loss attributable to noncontrolling interests	1		1		3		4
Comprehensive income attributable to Hilton stockholders	$	376	$	238	$	1,021	$	254

____________

(1)Amount was less than $1 million.

See notes to condensed consolidated financial statements.

4

HILTON WORLDWIDE HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(unaudited)

	Nine Months Ended
	September 30,
	2022		2021
Operating Activities:
Net income	$	924	$	259
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Amortization of contract acquisition costs	28		23
Depreciation and amortization expenses	123		143
Gain on foreign currency transactions	(4)		(1)
Share-based compensation expense	126		144
Deferred income taxes	54		6
Contract acquisition costs, net of refunds	(61)		(160)
Working capital changes and other	9		(436)
Net cash provided by (used in) operating activities	1,199		(22)
Investing Activities:
Capital expenditures for property and equipment	(19)		(17)
Issuance of other financing receivables	(46)		(3)
Undesignated derivative financial instruments	65		(13)
Capitalized software costs	(43)		(28)
Investments in unconsolidated affiliates	(53)		—
Other	(2)		27
Net cash used in investing activities	(98)		(34)
Financing Activities:
Borrowings	23		1,505
Repayment of debt	(35)		(3,221)
Debt issuance costs and redemption premium	—		(76)
Dividends paid	(82)		—
Repurchases of common stock	(1,092)		—
Share-based compensation tax withholdings	(56)		(48)
Proceeds from share-based compensation	16		26
Settlements of interest rate swap with financing component	(4)		—
Net cash used in financing activities	(1,230)		(1,814)
Effect of exchange rate changes on cash, restricted cash and cash equivalents	(21)		(6)
Net decrease in cash, restricted cash and cash equivalents	(150)		(1,876)
Cash, restricted cash and cash equivalents, beginning of period	1,512		3,263
Cash, restricted cash and cash equivalents, end of period	$	1,362	$	1,387
Supplemental Disclosures:
Cash paid during the period:
Interest	$	264	$	254
Income taxes, net of refunds	253		79

See notes to condensed consolidated financial statements.

5

HILTON WORLDWIDE HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Note 1: Organization and Basis of Presentation

Organization

Hilton Worldwide Holdings Inc. (the "Parent," or together with its subsidiaries, "Hilton," "we," "us," "our" or the "Company"), a Delaware corporation, is one of the largest hospitality companies in the world and is engaged in managing, franchising, owning and leasing hotels and resorts, and licensing its intellectual property ("IP"), including brand names, trademarks and service marks. As of September 30, 2022, we managed, franchised, owned or leased 7,061 hotels and resorts, including timeshare properties, totaling 1,111,147 rooms in 123 countries and territories.

Basis of Presentation

The accompanying condensed consolidated financial statements for the three and nine months ended September 30, 2022 and 2021 have been prepared in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP") and are unaudited. We have condensed or omitted certain disclosures normally included in annual financial statements presented in accordance with GAAP but that are not required for interim reporting purposes. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported and, accordingly, ultimate results could differ from those estimates. Additionally, interim results are not necessarily indicative of full year performance. In particular, the coronavirus ("COVID-19") pandemic (the "pandemic") had an adverse impact on certain of our results for the three and nine months ended September 30, 2022 and 2021; however, our results experienced significant recovery during the three and nine months ended September 30, 2022 when compared to prior year periods. As such, these interim periods, as well as upcoming periods, may not be comparable to periods prior to the onset of the pandemic or to other periods affected by the pandemic, and are not indicative of future performance. Management has made estimates and judgments in light of these circumstances. In our opinion, the accompanying condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of the interim periods. All material intercompany transactions have been eliminated in consolidation.

Note 2: Revenues from Contracts with Customers

Contract Liabilities

The following table summarizes the activity of our contract liabilities, which are classified as components of current and long-term deferred revenues, during the nine months ended September 30, 2022:

	(in millions)
Balance as of December 31, 2021	$	1,166
Cash received in advance and not recognized as revenue	329
Revenue recognized(1)(2)	(380)
Other(3)	(64)
Balance as of September 30, 2022	$	1,051

____________

(1)Primarily related to Hilton Honors, our guest loyalty program, including co-branded credit card arrangements.

(2)Revenue recognized during the three months ended September 30, 2022 was $139 million. Revenue recognized during the three and nine months ended September 30, 2022 included a net increase in revenue of $7 million and $4 million, respectively, for Hilton Honors points redeemed in prior periods, as a result of a change to the estimated breakage of Hilton Honors points for which point expirations have been temporarily suspended.

(3)Primarily represents changes in estimated transaction prices for our performance obligations related to the issuance of Hilton Honors points, which had no effect on revenues.

6

Performance Obligations

As of September 30, 2022, we had deferred revenues for unsatisfied performance obligations consisting of: (i) $352 million related to Hilton Honors that will be recognized as revenue over approximately the next two years; (ii) $669 million related to application, initiation and other fees; and (iii) $30 million related to other obligations. These performance obligations are recognized as revenue as discussed in Note 2: "Basis of Presentation and Summary of Significant Accounting Policies" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

Note 3: Consolidated Variable Interest Entities

As of September 30, 2022 and December 31, 2021, we consolidated two variable interest entities ("VIEs") that each lease one hotel property. We consolidated these VIEs since we are the primary beneficiary, having the power to direct the activities that most significantly affect their economic performance. Additionally, we have the obligation to absorb losses and the right to receive benefits that could be significant to each of the VIEs individually. The assets of our consolidated VIEs are only available to settle the obligations of the respective entities, and the liabilities of the consolidated VIEs are non-recourse to us.

Our condensed consolidated balance sheets include the assets and liabilities of these entities, which primarily comprised the following:

	September 30,		December 31,
	2022		2021
	(in millions)
Cash and cash equivalents	$	20	$	18
Property and equipment, net	42		60
Deferred income tax assets	49		62
Other non-current assets	49		62
Accounts payable, accrued expenses and other	15		15
Long-term debt(1)	145		179
Other long-term liabilities	14		16

____________

(1)Includes finance lease liabilities of $109 million and $153 million as of September 30, 2022 and December 31, 2021, respectively.

During the nine months ended September 30, 2022, our consolidated VIEs borrowed a net 2.7 billion JPY (equivalent to $19 million as of September 30, 2022), with a weighted average interest rate of 1.22 percent as of September 30, 2022 and maturity dates ranging from May 2023 to February 2029; these borrowings are included in current maturities of long-term debt and long-term debt in our condensed consolidated balance sheet as of September 30, 2022.

As of December 31, 2021, one of our consolidated VIEs had drawn 500 million JPY (equivalent to $4 million as of December 31, 2021) under a revolving credit facility, which was fully repaid by July 2022.

Note 4: Finite-Lived Intangible Assets

Our finite-lived intangible assets consist of management and franchise contracts and other intangible assets. Management and franchise contracts, net were as follows:

	September 30, 2022
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
	(in millions)
Management contracts recorded at Merger(1)	$	283	$	(265)	$	18
Contract acquisition costs	936		(195)		741
Development commissions and other	145		(30)		115
	$	1,364	$	(490)	$	874

7

	December 31, 2021
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value
	(in millions)
Management contracts recorded at Merger(1)	$	310	$	(275)	$	35
Contract acquisition costs	780		(170)		610
Development commissions and other	140		(27)		113
	$	1,230	$	(472)	$	758

____________

(1)Represents intangible assets that were initially recorded at fair value as part of the 2007 transaction whereby we became a wholly owned subsidiary of affiliates of Blackstone Inc. (the "Merger").

Amortization of our finite-lived intangible assets was as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
	(in millions)
Recognized in depreciation and amortization expenses(1)	$	27	$	32	$	88	$	103
Recognized as a reduction of franchise and licensing fees and base and other management fees	10		9		28		23

____________

(1)Includes amortization expense associated with assets that were initially recorded at fair value at the time of the Merger of $11 million for both the three months ended September 30, 2022 and 2021 and $34 million and $35 million for the nine months ended September 30, 2022 and 2021, respectively.

Note 5: Debt

Long-term debt balances, including obligations for finance leases, and associated interest rates and maturities as of September 30, 2022, were as follows:

	September 30,		December 31,
	2022		2021
	(in millions)
Senior secured term loan facility with a rate of 4.83%, due 2026	$	2,619	$	2,619
Senior notes with a rate of 5.375%, due 2025(1)	500		500
Senior notes with a rate of 4.875%, due 2027(1)	600		600
Senior notes with a rate of 5.750%, due 2028(1)	500		500
Senior notes with a rate of 3.750%, due 2029(1)	800		800
Senior notes with a rate of 4.875%, due 2030(1)	1,000		1,000
Senior notes with a rate of 4.000%, due 2031(1)	1,100		1,100
Senior notes with a rate of 3.625%, due 2032(1)	1,500		1,500
Finance lease liabilities with a weighted average rate of 5.85%, due 2022 to 2030	153		208
Other debt of consolidated VIEs with a weighted average rate of 1.21%, due 2023 to 2029(2)	36		26
	8,808		8,853
Less: unamortized deferred financing costs and discount	(77)		(87)
Less: current maturities of long-term debt(3)	(39)		(54)
	$	8,692	$	8,712

____________

(1)These notes are collectively referred to as the Senior Notes and are jointly and severally guaranteed on a senior unsecured basis by the Parent and substantially all of its direct and indirect wholly owned domestic restricted subsidiaries, other than Hilton Domestic Operating Company Inc., an indirect wholly owned subsidiary of the Parent and the issuer of all of the series of Senior Notes.

(2)Refer to Note 3: "Consolidated Variable Interest Entities" for additional information on the debt of our consolidated VIEs.

(3)Represents current maturities of finance lease liabilities and borrowings of a consolidated VIE.

Our senior secured credit facilities consist of a $1.75 billion senior secured revolving credit facility (the "Revolving Credit Facility") and a senior secured term loan facility (the "Term Loan"). The obligations of our senior secured credit facilities are unconditionally and irrevocably guaranteed by the Parent and substantially all of its direct and indirect wholly owned domestic

8

restricted subsidiaries. As of September 30, 2022, we had $60 million of letters of credit outstanding under the Revolving Credit Facility, resulting in an available borrowing capacity of $1,690 million.

Note 6: Fair Value Measurements

The fair values of certain financial instruments and the hierarchy level we used to estimate the fair values are shown below:

	September 30, 2022
			Hierarchy Level
	Carrying Value		Level 1		Level 2		Level 3
	(in millions)
Assets:
Cash equivalents	$	499	$	—	$	499	$	—
Interest rate swap(1)	116		—		116		—
Liabilities:
Long-term debt(2)	8,542		5,086		—		2,551

	December 31, 2021
			Hierarchy Level
	Carrying Value		Level 1		Level 2		Level 3
	(in millions)
Assets:
Cash equivalents	$	622	$	—	$	622	$	—
Liabilities:
Long-term debt(2)	8,532		6,180		—		2,599
Interest rate swaps(1)	41		—		41		—

____________

(1)Interest rate swaps are included in other non-current assets or other long-term liabilities in our condensed consolidated balance sheets depending on their value to us as of the balance sheet date. During the nine months ended September 30, 2022, one of the interest rate swaps that was outstanding as of December 31, 2021 matured. The remaining interest rate swap outstanding as of September 30, 2022 will mature in March 2026.

(2)The carrying values include the deduction for unamortized deferred financing costs and any applicable discounts. The carrying values and fair values exclude finance lease liabilities and other debt of consolidated VIEs.

We measure our interest rate swaps at fair value, which was determined using a discounted cash flow analysis that reflects the contractual terms of the interest rate swaps, including the period to maturity, and uses observable market-based inputs of similar instruments, including interest rate curves, as applicable.

The fair values of financial instruments not included in these tables are estimated to be equal to their carrying values as of September 30, 2022 and December 31, 2021.

Note 7: Income Taxes

At the end of each quarter, we estimate the effective income tax rate expected to be applied for the full year. The effective income tax rate is determined by the level and composition of income (loss) before income taxes, which is subject to federal, state, local and foreign income taxes.

In August 2022, the Inflation Reduction Act of 2022 (the "IRA") was signed into law in the U.S. We do not expect the IRA to have a material impact on our consolidated financial statements, including our annual estimated effective tax rate.

Note 8: Share-Based Compensation

We recognized share-based compensation expense of $42 million and $52 million during the three months ended September 30, 2022 and 2021, respectively, and $126 million and $144 million during the nine months ended September 30, 2022 and 2021, respectively, which included amounts reimbursed by hotel owners.

Our share-based compensation primarily consists of awards that we grant to eligible employees under the Hilton 2017 Omnibus Incentive Plan (the "2017 Plan") and includes time-vesting restricted stock units ("RSUs"), nonqualified stock options

9

("options") and performance-vesting RSUs ("performance shares"). As of September 30, 2022, unrecognized compensation costs for unvested awards under the 2017 Plan were approximately $141 million, which are expected to be recognized over a weighted-average period of 1.7 years on a straight-line basis.

RSUs

During the nine months ended September 30, 2022, we granted 507,000 RSUs with a weighted average grant date fair value per share of $150.58, which vest in equal annual installments over two or three years from the date of grant.

Options

During the nine months ended September 30, 2022, we granted 318,000 options with an exercise price per share of $150.67, which vest in equal annual installments over three years from the date of grant and terminate 10 years from the date of grant or earlier if the individual’s service terminates under certain circumstances.

The grant date fair value per share of the options granted during the nine months ended September 30, 2022 was $51.15, which was determined using the Black-Scholes-Merton option-pricing model with the following assumptions:

Expected volatility(1)	33.28	%
Dividend yield(2)	0.41	%
Risk-free rate(3)	1.93	%
Expected term (in years)(4)	6.0

____________

(1)Estimated using a blended approach of historical and implied volatility. Historical volatility is based on the historical movement of Hilton's stock price for a look back period that corresponds to the expected term of the option.

(2)Estimated based on the expectation, at the date of grant, of the resumption of a quarterly $0.15 per share dividend, as well as our three-month average stock price.

(3)Based on the yields of U.S. Department of Treasury instruments with similar expected terms at the date of grant.

(4)Estimated using the midpoint of the vesting period and the contractual term of the options.

Performance Shares

During the nine months ended September 30, 2022, we granted 216,000 performance shares with a grant date fair value per share of $150.67. We recognize compensation expense based on the total number of performance shares that are expected to vest as determined by the projected achievement of each of the performance measures, which are estimated each reporting period and range from zero percent to 200 percent, with 100 percent being the target. As of September 30, 2022, we determined that all of the performance measures for the outstanding performance shares were probable of achievement, with the average of the achievement factors estimated to be between the target and maximum achievement percentages for the performance shares granted in 2020 and 2021 and at target for the performance shares granted in 2022.

10

Note 9: Earnings Per Share

The following table presents the calculation of basic and diluted earnings per share ("EPS"):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
	(in millions, except per share amounts)
Basic EPS:
Numerator:
Net income attributable to Hilton stockholders	$	347	$	241	$	927	$	263
Denominator:
Weighted average shares outstanding	273		279		277		278
Basic EPS	$	1.27	$	0.86	$	3.35	$	0.94
Diluted EPS:
Numerator:
Net income attributable to Hilton stockholders	$	347	$	241	$	927	$	263
Denominator:
Weighted average shares outstanding(1)	275		281		279		281
Diluted EPS	$	1.26	$	0.86	$	3.32	$	0.94

____________

(1)Certain shares related to share-based compensation were excluded from the calculations of diluted EPS because their effect would have been anti-dilutive under the treasury stock method, including 1 million shares for both the three and nine months ended September 30, 2022, and less than 1 million shares for both the three and nine months ended September 30, 2021.

Note 10: Stockholders' Equity (Deficit) and Accumulated Other Comprehensive Loss

The following tables present the changes in the components of stockholders' equity (deficit):

	Three Months Ended September 30, 2022
	Equity (Deficit) Attributable to Hilton Stockholders
				Treasury Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss
	Common Stock											Noncontrolling Interests
	Shares	Amount												Total
	(in millions)
Balance as of June 30, 2022	275.5	$	3	$	(5,048)	$	10,753	$	(5,783)	$	(714)	$	—	$	(789)
Net income (loss)	—	—		—		—		347		—		(1)		346
Other comprehensive income	—	—		—		—		—		29		—		29
Dividends(1)	—	—		—		—		(41)		—		—		(41)
Repurchases of common stock(2)	(4.0)	—		(497)		—		—		—		—		(497)
Share-based compensation	—	—		—		38		—		—		—		38
Balance as of September 30, 2022	271.5	$	3	$	(5,545)	$	10,791	$	(5,477)	$	(685)	$	(1)	$	(914)

	Three Months Ended September 30, 2021
	Equity (Deficit) Attributable to Hilton Stockholders
				Treasury Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss
	Common Stock											Noncontrolling Interests
	Shares	Amount												Total
	(in millions)
Balance as of June 30, 2021	278.7	$	3	$	(4,447)	$	10,603	$	(6,710)	$	(866)	$	1	$	(1,416)
Net income (loss)	—	—		—		—		241		—		(1)		240
Other comprehensive loss	—	—		—		—		—		(3)		—		(3)
Share-based compensation	—	—		—		51		—		—		—		51
Balance as of September 30, 2021	278.7	$	3	$	(4,447)	$	10,654	$	(6,469)	$	(869)	$	—	$	(1,128)

11

	Nine Months Ended September 30, 2022
	Equity (Deficit) Attributable to Hilton Stockholders
				Treasury Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss
	Common Stock											Noncontrolling Interests
	Shares	Amount												Total
	(in millions)
Balance as of December 31, 2021	279.1	$	3	$	(4,443)	$	10,720	$	(6,322)	$	(779)	$	2	$	(819)
Net income (loss)	—	—		—		—		927		—		(3)		924
Other comprehensive income	—	—		—		—		—		94		—		94
Dividends(1)	—	—		—		—		(82)		—		—		(82)
Repurchases of common stock(2)	(8.5)	—		(1,107)		—		—		—		—		(1,107)
Share-based compensation	0.9	—		5		71		—		—		—		76
Balance as of September 30, 2022	271.5	$	3	$	(5,545)	$	10,791	$	(5,477)	$	(685)	$	(1)	$	(914)

	Nine Months Ended September 30, 2021
	Equity (Deficit) Attributable to Hilton Stockholders
				Treasury Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss
	Common Stock											Noncontrolling Interests
	Shares	Amount												Total
	(in millions)
Balance as of December 31, 2020	277.6	$	3	$	(4,453)	$	10,552	$	(6,732)	$	(860)	$	4	$	(1,486)
Net income (loss)	—	—		—		—		263		—		(4)		259
Other comprehensive loss	—	—		—		—		—		(9)		—		(9)
Share-based compensation	1.1	—		6		102		—		—		—		108
Balance as of September 30, 2021	278.7	$	3	$	(4,447)	$	10,654	$	(6,469)	$	(869)	$	—	$	(1,128)

____________

(1)During the three months ended June 30, 2022, we resumed payment of regular quarterly cash dividends.

(2)During the three months ended March 31, 2022, we resumed share repurchases under our previously authorized stock repurchase program.

The changes in the components of accumulated other comprehensive loss, net of taxes, were as follows:

	Currency Translation Adjustment(1)		Pension Liability Adjustment(2)		Cash Flow Hedge Adjustment(3)		Total
	(in millions)
Balance as of December 31, 2021	$	(540)	$	(210)	$	(29)	$	(779)
Other comprehensive income (loss) before reclassifications	(48)