Travel + Leisure (TNL) Q1 2025 earnings summary

Executive summary

• Net revenue for Q1 2025 was $934 million, up 2% year-over-year, with adjusted EBITDA of $202 million, at the high end of guidance, and adjusted diluted EPS up 14% to $1.11.

• Net income attributable to shareholders increased to $73 million, with diluted EPS of $1.07 and adjusted EBITDA margin rising to 22%.

• Returned $111 million to shareholders in Q1 2025 through $41 million in dividends and $70 million in share repurchases.

• Closed a $350 million term securitization in March 2025 and renewed a $600 million ABS conduit facility to August 2027.

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

Financial highlights

• Vacation Ownership segment revenue grew 4% to $755 million; adjusted EBITDA up 18% to $159 million, with VPG up 6% to $3,212.

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

• Adjusted free cash flow reached $152 million in Q1 2025, with over 50% conversion from adjusted EBITDA.

• Operating cash flow was $121 million, up from $47 million year-over-year.

• Leverage ratio stood at 3.3x as of March 31, 2025; net debt was $3.5 billion, excluding $2.2 billion of non-recourse debt.

Outlook and guidance

• Q2 2025 adjusted EBITDA projected at $245–$255 million; full-year 2025 guidance reaffirmed at $955–$985 million.

• Gross VOI sales guidance for Q2 2025: $620–$640 million; full-year 2025: $2.4–$2.5 billion; VPG: $3,050–$3,150.

• Travel and Membership adjusted EBITDA expected to be 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 at $120–$130 million; vacation ownership development spending expected at $150–$180 million.