Accor Seeing Strong Travel Demand Across All Regions Continuing in 2023

While inflation presents near-term demand headwinds, we expect Accor to expand share in the hotel industry over the next decade as a result of its solid loyalty and exposure to the millennial traveler through its growing lifestyle brands, supporting its intangible brand asset advantage, the source of its narrow moat. As a result, we see Accor posting 3% unit growth on average over the next 10 years, well above the roughly 1% long-term industry rate in its core European region (43% of total rooms in 2022). Accor's growing room share is being driven by an increased presence in higher-end luxury/upscale rooms, which were 27% of its total in 2022. This higher luxury presence diversifies Accor from its core economy/midscale exposure, which more directly competes against Airbnb and other alternative accommodations.