Travel + Leisure raises 2026 adjusted EBITDA guidance as adjusted EPS rises 23%

Travel + Leisure Co. (TNL) reported third-quarter 2026 revenue of $1,101 million on Tuesday, up 5% from a year earlier, as higher vacation ownership sales outweighed weaker travel and membership results.

Net income attributable to shareholders was $108 million, down 3% from $111 million, the company said in a press release furnished with its 8-K filing. Diluted earnings per share were $1.73, up 4% from $1.67. Weighted average diluted shares were 62.6 million, down from 66.1 million a year earlier.

Adjusted diluted earnings per share rose 23% to $2.21 from $1.80.

Here's how the company did:

• Revenue: $1,101 million vs. $1,044 million a year earlier
• Net income: $108 million vs. $111 million a year earlier
• Diluted EPS: $1.73 vs. $1.67 a year earlier
• Adjusted diluted EPS: $2.21 vs. $1.80 a year earlier
• Adjusted EBITDA: $283 million vs. $266 million a year earlier

Adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization, excluding certain items, rose 6% to $283 million. The margin was 25.7% of revenue, up from 25.5%.

For the first nine months, revenue was $3,125 million, up 4% from $2,996 million, and adjusted EBITDA was $777 million, up 8% from $718 million. Net income was $296 million, up 2% from $291 million, and adjusted diluted EPS was $5.51, up 21% from $4.55.

Net cash from operating activities for the nine months was $388 million, down from $516 million a year earlier. Adjusted free cash flow was $254 million, compared with $326 million.

The company is updating its 2026 full-year guidance. It expects adjusted EBITDA of $1.070 billion to $1.085 billion, Gross VOI sales of $2.625 billion to $2.675 billion, and VPG, or volume per guest, of $3,325 to $3,375. The release said the company raised the midpoint of its adjusted EBITDA range, but the filing does not restate the prior range.

"Travel + Leisure delivered another strong quarter, building on our momentum throughout the year," said President & CEO Michael D. Brown.

Vacation Ownership revenue rose 9% to $953 million from $876 million, and segment adjusted EBITDA rose 8% to $250 million from $231 million.

Gross VOI sales rose 6% to $720 million from $682 million, driven by a 7% increase in tours to 213,000 from 200,000. VPG fell 1% to $3,286 from $3,304, which the filing attributes to the mix impact from recent acquisitions.

Travel and Membership revenue fell 11% to $150 million from $169 million, and segment adjusted EBITDA fell 12% to $51 million from $58 million.

Transaction revenue fell $17 million, the company said, as a higher share of exchange members held club affiliations and transacted less often.

Yes& Vacations and Spinnaker Resorts closed during the third quarter, and the company invested approximately $350 million in the two acquisitions, according to the filing.

Leverage for covenant purposes was 3.3 times as of Sept. 30, up from the prior period because of the acquisition funding. Corporate debt totaled $4.0 billion, excluding $2.0 billion of non-recourse debt tied to its securitized notes receivables portfolio.

After the quarter ended, the company closed a $300 million term securitization of timeshare receivables, with a weighted average coupon of 6.18% and a 98% advance rate.

The company returned $364 million to shareholders through September, including $250 million in share repurchases and $114 million in dividends. In the third quarter it bought back about 1.1 million shares for $75 million, at a weighted average price of $71.45 per share, leaving $671 million on its repurchase authorization. It paid a $0.60 per share dividend on Sept. 30 and will recommend another $0.60 per share for the fourth quarter, for board approval in November 2026.

A resort optimization initiative identified 17 resorts that need owner reinvestment or sit in markets that no longer align with owner demand. The company incurred $2 million of inventory write-downs and impairments in the third quarter and $27 million for the nine months. It expects the initiative to have a positive net impact to adjusted EBITDA in 2026, partly offset by lower VOI sales and property management fees at the affected resorts.

Restructuring charges were $12 million in the quarter.