DiamondRock Hospitality Company (DRH) Q2 2026 earnings summary

Executive summary

• Net income for Q2 2026 more than doubled year-over-year to $90.8 million, or $0.44 per diluted share, with adjusted EBITDA up 19.2% to $107.9 million, driven by strong RevPAR growth and disciplined cost control.

• Revenue for Q2 2026 increased 4.1% to $318.3 million, with portfolio-wide demand strength and margin expansion of 240 basis points.

• Free cash flow per diluted share rose 27% year-over-year to $0.80, and trailing 12-month free cash flow grew 30%.

• The company completed the sale of Courtyard New York Manhattan/Fifth Avenue for $33 million, recognized a $31.6 million gain, and increased its quarterly common dividend by 22% to $0.11 per share.

• Conservative balance sheet with no debt maturities until 2029, net debt-to-EBITDA near 3x, and $500 million borrowing capacity.

Financial highlights

• Q2 2026 total revenues: $318.3 million (up 4.1%); net income: $90.8 million (up from $41.0 million); adjusted EBITDA: $107.9 million (up 19.2%); adjusted FFO: $91.8 million (up 27%).

• Comparable RevPAR increased 7% year-over-year to $240.79; June saw 10.1% growth.

• Adjusted FFO per share was $0.44; margin expanded 303 basis points excluding the property tax benefit.

• Hotel operating expenses increased 1.8% versus 5.5% revenue growth in Q2; productivity gains kept wage and benefit growth at 2.2%.

• Gain on sale of hotel property was $31.6 million in Q2 2026.

Outlook and guidance

• Full-year 2026 guidance raised: comparable RevPAR growth 2.5%–4%, adjusted EBITDA $310–$320 million, adjusted FFO per share $1.18–$1.23.

• Capital expenditures for 2026 projected at $75–$85 million, with several major renovations planned.

• Free cash flow per share projected to grow 18% in 2026.

• Regular quarterly dividends of $0.11 per share expected for the remainder of 2026.

• Expect continued margin gains, though at a slower pace in the back half of the year due to higher labor costs and bonus accruals.