Travel + Leisure (TNL) Q1 2025 earnings summary

Executive summary

• Net revenue for Q1 2025 was $934 million, up 2% year-over-year, driven by higher Vacation Ownership sales and property management fees, partially offset by lower Travel and Membership revenues.

• Adjusted EBITDA reached $202 million, a 6% increase year-over-year, at the high end of guidance, with adjusted diluted EPS up 14% to $1.11.

• Net income attributable to shareholders increased to $73 million, with diluted EPS of $1.07.

• Returned $111 million to shareholders through $41 million in dividends and $70 million in share repurchases.

• Management transition underway as long-serving CFO Mike Hug retires, with a successor announcement imminent.

Financial highlights

• Vacation Ownership segment revenue grew 4% to $755 million; adjusted EBITDA up 18% to $159 million.

• Travel and Membership segment revenue declined 7% to $180 million; adjusted EBITDA down 9% to $68 million, driven by a 13% drop in exchange transactions.

• Gross VOI sales totaled $512 million, up 4% year-over-year; VPG reached $3,212, at the high end of guidance.

• Operating cash flow was $121 million; adjusted free cash flow reached $152 million in Q1.

• Closed a $350 million ABS transaction at a 5.2% interest rate and 98% advance rate; $600 million ABS conduit facility renewed to August 2027.

Outlook and guidance

• Q2 adjusted EBITDA projected at $245–$255 million; full-year adjusted EBITDA guidance reiterated at $955–$985 million.

• Vacation Ownership Q2 gross VOI sales expected at $620–$640 million, with VPGs of $3,050–$3,150.

• Travel and Membership segment guidance revised to flat to down 2% for the year.

• Adjusted EBITDA to free cash flow conversion expected to exceed 50% for the year.

• Full-year capital expenditures anticipated between $120 million and $130 million; vacation ownership development spending expected at $150–$180 million.