W. Bush, it’s the economy, stupid, I think. I am not calling you stupid Bill, for the record. But it has everything to do with the economy. I mean the reality is, as I have said in my comments, our outlook is based on a pretty – not just consensus view, but a strong consensus view that the economy is going to be growing at a decent rate and employment is going to stay pretty strong. Obviously, higher for longer is the Fed’s way of trying to like tamp things down. But there is no question in my mind, you can have your own view. Everybody can that the Fed is trying to orchestrate a soft landing. So far, it feels like they have been able to do it. Our outlook with the U.S. being at the low end of our guidance ranges sort of anticipate that consensus view, which is a soft landing, which means the economy is more resilient than people thought, but broadly as the year goes on, softening because that’s what the Fed is trying to do.
And we have tried to sort of factor for all of that in our guidance. And so whether it’s the upper end, lower end or wherever it is, I think it has everything to do with a broader economy. The good news for us is, the median income of our core customer, like our lower member [ph] is high, it’s 150,000 median income where the Fed where you look at the data out of the credit card companies and the retailers, it’s like 100,000 and below is where you see people stretched and credit card balances, bank accounts running out and credit card balances going up. When you get up into the 150,000, the data still looks really good in terms of people have a lot of money in the bank and they have enough disposable income. And as we have said, businesses, company, corporate America is still relatively strong.
So, I think of the economy, if they – I think this range and outcome that we have given and sort of where the U.S. we think will flush out is based on the consensus view that we will have some slowing, but a soft landing and positive economic growth.
Operator: Thank you. The next question comes from Richard Clarke with Bernstein. Please go ahead.
Richard Clarke: Hi. Good morning. Thanks for taking my questions. In the quarter versus 2019, it looks like U.S. occupancy is still 450 basis points where you were pre-COVID. Obviously, there is some seasonality in there. But that doesn’t seem to get you anywhere near that. Is it just now a matter of time to get occupancy back or can we now think that maybe there has been some structural shift in travel that means kind of ended up…?
Chris Nassetta: I think you answered it, large. That has more to do with seasonality than anything. And the calendar shift because remember, leisure is sort of 25% or 30% of our business and because of the calendar – because of the holiday shift, it ended up being a big leisure quarter, which meant leisure was good, but the reality is then 70%, 75% of the business was not. And so I think it’s a seasonal plus the compounding impact of the movement of the holiday. So, I do think – I mean listen, we sort of got – we got pretty close in December. So, I mean by the fourth quarter of last year, we were pretty tight on 2019 levels.
Operator: Thank you. The next question is from Conor Cunningham with Melius Research. Please go ahead.
Conor Cunningham: Hi everyone. Thank you. Could you just talk a little bit about the competition for conversions? Where things are most intense and where regions or areas that you are having more success? You have obviously did really well in the first quarter, I think you said 30% of your makeup of the new development was there, just any thoughts there on competition. Thank you.
Kevin Jacobs: Yes. Conor, it sort of depends on – it’s sort of a little bit deal dependent, right. Sometimes it often depends on which flags are available in that particular market. It depends on where you are at the upper end in luxury, there is a lot more competition because there is just more brands. And then when you get into the sort of the middle tiers and below, there is us and a couple of others that not to be competitive that sort of maybe fight for second place when we are not available. So, yes, we do really well. I think for the full year last year, in the U.S., we did 40% of all conversion deals that were done in the U.S. So, we take a lot of share. We are doing really well. So, we have talked about Spark is going to be really disruptive in terms of your bringing a brand to a segment that we haven’t been in before.
So, you are combining the strength of our engines with a brand that’s sort of new and innovative and can be really disruptive in that space. But that’s not the only place we are being successful. We are being successful all over the world. I think we mentioned DoubleTree in our prepared remarks. Our soft brands are gaining momentum, Curio, Tapestry, LXR. So, it really – I am rambling a little bit. It really does depend on the deal in terms of who shows up and we are competitive with. But I think the good news is when our flags are available, if you can mine our engines with the quality of our brands, we are always right there at the top of the list for developers.
Operator: Thank you. The next question is from Dan Politzer with Wells Fargo. Please go ahead.
Dan Politzer: Hi. Good morning everyone and thanks for taking my question. Europe seems like it’s certainly a bright spot within your portfolio. Can you maybe even outside the Olympics for the rest of the year, could you maybe frame where you are seeing that demand? Is it on the business or leisure side? Is it kind of the higher chain scales or middle tier? Any additional detail there would be helpful. Thanks.
Kevin Jacobs: Yes. I think it’s really across the board. They are seeing the same dynamics. The group demand is strong, business, leisure, particularly with the strength of the dollar that sort of buys more for leisure travelers going over there, it’s really been across the board.
Operator: Thank you. The next question is from Ben Chaiken with Mizuho. Please go ahead.
