Wyndham Hotels & Resorts raises 2026 outlook as third-quarter net income falls to $99 million
Adjusted EBITDA was $207 million, down from $213 million a year earlier, while the adjusted diluted EPS outlook moved up to $4.84 to $4.92.
Key takeaways
- Wyndham Hotels & Resorts Inc. (WH) said in a regulatory filing on Oct. 21 that third-quarter net income fell to $99 million from $105 million a year earlier, while revenue rose to $410 million. The company raised its full-year adjusted EBITDA outlook to $740 million to $745 million and increased its share repurchase authorization by $400 million.
Wyndham Hotels & Resorts Inc. (WH) reported third-quarter net income of $99 million, down from $105 million a year earlier, and updated its full-year 2026 outlook, the company said Wednesday in a press release filed with an 8-K.
Revenue rose 7% to $410 million. Adjusted EBITDA fell 3% to $207 million.
Here's how the company did:
- Revenue: $410 million vs. $382 million a year earlier
- Net income: $99 million vs. $105 million a year earlier
- Diluted EPS: $1.33 vs. $1.36 a year earlier
- Adjusted diluted EPS: $1.43 vs. $1.46 a year earlier
- Adjusted EBITDA: $207 million vs. $213 million a year earlier
- Adjusted net income: $107 million vs. $112 million a year earlier
Here's how other segments did during the quarter:
- Hotel franchising adjusted EBITDA: $229 million vs. $228 million a year earlier
- Corporate adjusted EBITDA: a loss of $22 million vs. a loss of $15 million a year earlier
The company's comparable-basis figures remove marketing fund variability, meaning the timing differences between marketing fund revenues and expenses. On that basis, adjusted EBITDA rose 5%, and adjusted diluted EPS rose about 9%.
The company said marketing fund revenues exceeded expenses by $1 million in the quarter, compared with $18 million a year earlier.
Global RevPAR, or revenue per available room, grew 2% in constant currency from a year earlier and 4% from the second quarter. U.S. RevPAR rose 6%.
International RevPAR fell 3%. Greater China declined 10% as softer travel demand, particularly in Tier 2 cities, continued to pressure performance.
General and administrative expenses rose to $36 million from $26 million.
The company's system grew 4% excluding rooms of Revo Hospitality Group, which the filing describes as insolvent. Including those rooms, global rooms reached 877,400, up 3%.
The development pipeline, excluding Revo, grew 4% from a year earlier to a record of about 264,000 rooms. The company said the pipeline carries a FeePAR premium of about 30% to existing domestic and international systems, with FeePAR meaning annual royalties per franchised room.
Geoff Ballotti, the company's President and Chief Executive Officer, said: "Our third quarter results demonstrate our team's continued execution and the strength of Wyndham's asset-light, highly cash-generative business model."
The company updated its full-year outlook as follows:
| Metric | Updated outlook | Prior outlook |
|---|---|---|
| Year-over-year rooms growth | About 4% | 4.0% to 4.5% |
| Global RevPAR growth, constant currency | 0.5% to 1.0% | 0.0% to 1.0% |
| Net revenues | $1.48 billion to $1.50 billion | $1.48 billion to $1.50 billion |
| Adjusted EBITDA | $740 million to $745 million | $735 million to $745 million |
| Adjusted net income | $363 million to $369 million | $355 million to $365 million |
| Adjusted diluted EPS | $4.84 to $4.92 | $4.71 to $4.83 |
| Free cash flow conversion rate | 55% to 60% | 55% to 60% |
The updated outlook excludes any room termination impact tied to Revo's ongoing insolvency. It assumes fourth-quarter domestic RevPAR is roughly consistent with third-quarter performance.
Adjusted EBITDA includes the deferral of royalties and franchise fees from Revo and one-time variable cost reductions made in 2025. Excluding those effects, comparable-basis growth would be about 6% to 7%.
The company said each 1% change in RevPAR equates to about $10 million in net revenues and $4 million in adjusted EBITDA.
The board recently increased the company's share repurchase authorization by $400 million. In the quarter, the company repurchased about 1.2 million shares for $91 million, a 30% increase from a year earlier, at an average price of $73.39 per share. It said that price was a 5% discount to its 52-week average.
Year to date through Sept. 30, the company repurchased about 2.5 million shares for $196 million. It paid common stock dividends of $32 million, or $0.43 per share, in the quarter.
The company generated $93 million of net cash from operating activities and $100 million of free cash flow in the quarter. It ended the quarter with $71 million of cash and $988 million of total liquidity.
Its net debt leverage ratio was 3.6 times at Sept. 30, near the midpoint of its 3-to-4 times target range.
Transaction-related costs for the nine months were $3 million, including costs of defending an unsuccessful hostile takeover attempt. Revo-related adjustments in the quarter were $1 million, consisting of professional fees tied to Revo's insolvency.
The company will hold a conference call on Thursday, Oct. 22, at 8:30 a.m. ET. On Oct. 21 it also posted a new investor presentation on its investor relations website.