Marriott Vacations Worldwide (VAC) risk factors, FY2024 10-K

Risks related to global or regional health concerns, outbreaks, and pandemics (each a “Health Crisis”)

1. 01The COVID-19 pandemic had, and a future Health Crisis may have, serious adverse effects on our business, financial condition, cash flows, and results of operations for an unknown period of time
2. 02The COVID-19 pandemic caused, and a future Health Crisis may cause, significant disruptions in international and U.S. economies and markets and have a material adverse impact on participants in the travel and hospitality industries, including our Company

Risks related to our business and industry

1. 03Our business may be adversely affected by factors that disrupt or deter travel
2. 04Our results of operations can be adversely affected by labor shortages, turnover and labor cost increases
3. 05Significant inflation, higher interest rates or deflation could adversely affect our business and financial results
4. 06Our business is extensively regulated, and any failure to comply with applicable laws could materially adversely affect our business
5. 07Changes in privacy laws could adversely affect our ability to market our products effectively
6. 08Failure to maintain the integrity of internal or customer data or to protect our information systems from cyber-attacks could disrupt our business, damage our reputation, and subject us to costs, fines or lawsuits
7. 09loss, disclosure, or fraudulent use of our customer, employee or company data could adversely impact our reputation and result in remedial and other expenses, fines, penalties or litigation, any of which may be exacerbated by a delay or failure to detect a cybersecurity incident or the full extent of such incident
8. 10Our use of AI technologies may not be successful and may present business, compliance, and reputational risks
9. 11Our international operations expose us to risks that could negatively impact our financial results or disrupt our business
10. 12Inadequate or failed technologies could lead to interruptions in our operations and materially adversely affect our business, financial position, results of operations or cash flows
11. 13Spanish court rulings voiding certain timeshare contracts have increased our exposure to litigation that may materially adversely affect our business and financial condition
12. 14The industries in which our businesses operate are competitive, which may impact our ability to compete successfully
13. 15Negative public perception regarding our industry could have an adverse effect on our operations
14. 16Changes in tax regulations or their interpretation could negatively impact our cash flows and results of operations
15. 17Concentration of some of our resorts, sales centers and exchange destinations in particular geographic areas exposes our business to the effects of severe weather and other regional events in these areas
16. 18If we are not able to successfully identify, finance, integrate and manage costs related to acquisitions, our business operations and financial position could be adversely affected
17. 19Our use of different estimates and assumptions in the application of our accounting policies could result in material changes to our reported financial condition and results of operations, and changes in accounting standards or their interpretation could significantly impact our reported results of operations
18. 20The growth of our business and execution of our business strategies depend on the services of our senior management and our associates
19. 21Increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices may increase our costs or expose us to new or additional risks

Risks related to our vacation ownership business

1. 22The termination of our license agreements with Marriott International or Hyatt, or our rights to use their trademarks at our existing or future properties, could materially harm our business
2. 23Deterioration in the quality or reputation of the brands associated with our portfolio could adversely affect our market share, reputation, business, financial condition and results of operations
3. 24Marriott International or Hyatt could compete with our vacation ownership business in the future
4. 25If a branded hotel property co-located with one of our resorts ceases to be affiliated with the same brand as our resort or a related brand, our business could be harmed
5. 26We may not have inventory available for sale when needed or we may have excess inventory
6. 27The sale of VOIs in the secondary market by existing owners could cause our sales revenues, margins, and results of operations to decline
7. 28Borrower defaults on the vacation ownership notes receivable our business generates could reduce our results of operations and cash flows
8. 29Our points-based product forms expose us to an increased risk of temporary inventory depletion
9. 30Our development activities expose us to project cost and completion risks
10. 31Our resort management business may be adversely affected by the loss of management contracts, failure of resorts to comply with brand standards, increased maintenance fees and disagreements with owners
11. 32Damage to, or other potential losses involving, properties that we own or manage may not be covered by insurance

Risks related to our exchange and third-party management business

1. 33Any adverse changes in our relationships with developers, members and others could adversely affect our Exchange & Third-Party Management business, financial condition, and results of operations
2. 34our financial condition and results of operations. Our ability to maintain affiliation agreements with resort developers is also impacted by consolidation in the vacation ownership industry
3. 35Insufficient availability of exchange inventory may adversely affect our results of operations

Risks related to our indebtedness

1. 36Our indebtedness may restrict our operations
2. 37If we are unable to comply with our debt agreements, or to raise additional capital when needed, our business, cash flow, liquidity, and results of operations could be harmed
3. 38We may incur substantially more debt, which could exacerbate further the risks associated with our leverage
4. 39If the default rates or other credit metrics underlying our vacation ownership notes receivable deteriorate, our vacation ownership notes receivable securitization program and VOI financing program could be adversely affected
5. 40We are subject to risks relating to our convertible notes
6. 41We are subject to risks relating to our convertible note hedges and warrants

Risks related to ownership of our common stock

1. 42Our share repurchase program may not enhance long-term stockholder value and could increase the volatility of the market price of our common stock and diminish our cash
2. 43Our ability to pay dividends on our stock is limited
3. 44Anti-takeover provisions in our organizational documents, Delaware law and in certain of our agreements could delay or prevent a change in control