Contracts with Customers

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Contracts with Customers

CONTRACTS WITH CUSTOMERS Our current and noncurrent liability for guest loyalty program increased by $225 million, to $6,496 million at September 30, 2021, from $6,271 million at December 31, 2020, primarily reflecting an increase in points earned by members. This includes a $171 million reclassification from deferred revenue to the liability for guest loyalty program as a result of points that were earned during the period by members using our U.S.-issued co-brand credit cards, which were prepaid by the financial institutions in 2020. The increase was partially offset by $1,338 million of revenue recognized in the 2021 first three quarters, that was deferred as of December 31, 2020. The current portion of our liability for guest loyalty program increased compared to December 31, 2020 due to higher estimated redemptions in the short-term.

Current and noncurrent deferred revenue decreased by $299 million, to $1,568 million at September 30, 2021, from $1,867 million at December 31, 2020, primarily as a result of $241 million of revenue recognized in the 2021 first three quarters that was deferred as of December 31, 2020, as well as the reclassification from deferred revenue to the liability for guest loyalty program, which we discuss above. The decrease was partially offset by an increase in franchise application and relicensing fees.

Our allowance for credit losses increased to $221 million at September 30, 2021 from $207 million at December 31, 2020, primarily reflecting our provision for credit losses. Our provision for credit losses totaled $1 million in the 2021 third quarter and $24 million in the 2021 first three quarters.