Earnings call· Jan 2026(Q2 FY26)

VAIL RESORTS Q2 FY26 earnings call MTN

Mar 9, 2026 Source

Executive summary

Vail Resorts Q2 FY26 — Unprecedented Rocky Mountain Weather Impacts Results, Pass Program Provides Stability

Vail Resorts faced unprecedented weather challenges in the Rockies during Q2 FY26, leading to significant declines in visitation and revenue. Despite these headwinds, the company's advanced commitment strategy, with pass holders comprising 75% of visitation, provided crucial stability. New pass and lift ticket initiatives, including a 20% discount for young adults, aim to optimize future revenue growth and engagement.

Highlights

4

Pass units grew 55% over the past 5 years, with pass holders now making up approximately 75% of annual visitation, providing meaningful stability.
Achieved record high system-wide guest satisfaction scores this season, including increases year-over-year in Colorado and Utah.
Resource Efficiency Transformation Plan expected to exceed initial $100 million annualized savings target by approximately $6 million by the end of FY26.
Q2 total lift revenue declined only approximately 3% despite visitation being down 13%, reflecting the stability provided by pass sales.

Concerns

4

Q2 total net revenue declined approximately 5% compared to the prior year, driven by unfavorable weather conditions.
Q2 resort reported EBITDA declined approximately 8% compared to the prior year due to weather-related headwinds.
Skier visitation declined approximately 12% season-to-date through March 1, consistent with ongoing weather impacts.
Full-year net income guidance reduced to $144 million-$190 million and resort reported EBITDA to $745 million-$775 million due to persistent challenging weather conditions.

Guidance & targets

7

Category	Target	Timeline	Confidence
Net income attributable to Vail Resorts	$144M-$190M high materiality	FY26	Medium
Resort reported EBITDA	$745M-$775M high materiality	FY26	Medium
Cash taxes	$95M-$105M medium materiality	FY26	Medium
Resource Efficiency Transformation Plan annualized savings	Exceed initial $100M target by ~$6M medium materiality	FY26	High
Resource Efficiency Transformation Plan incremental savings	$42M medium materiality	FY26	High
Core capital expenditures	$215M-$220M medium materiality	CY26	High
Total capital spending	$234M-$239M medium materiality	CY26	High

Operational metrics

26

Pass units growth

55%

Past 5 years

Growth in pass units over the last five years.

Pass holders as % of annual visitation

75%

Annual

Pass holders now make up approximately 75% of annual visitation.

Rockies snowfall

43%YoY decline

Q2 FY26

Historically challenging conditions in the Rockies significantly impacted performance.

Rockies snowfall vs FY12

40%lower than FY12

This season

Magnitude of conditions impact, compared to the historically worst weather year.

February temperature vs average

9 degreeswarmer than average

February

Warmest winter to date on record for Colorado, impacting terrain opening.

Acres opened

70%-80%

Through February

Limited terrain availability due to low snowfall and warm temperatures.

Q2 total net revenue

5%declined YoY

Q2 FY26

Driven by unfavorable weather conditions negatively impacting visitation and ancillary spending.

Q2 total lift revenue

3%declined YoY

Q2 FY26

Despite visitation being down 13%, reflecting stability from pass sales.

Q2 resort reported EBITDA

8%declined YoY

Q2 FY26

Weather-related headwinds partially offset by disciplined cost management and savings.

Skier visitation

12%declined

Season-to-date through March 1

Consistent with ongoing weather impacts.

Lift revenue

4%declined

Season-to-date through March 1

Growth in pass revenue was offset by declines in non-pass lift ticket revenue.

Pass revenue

3%up

Season-to-date through March 1

Partially offset by declines in non-pass lift ticket revenue.

Pass visitation

14%declined

Season-to-date through March 1

Even the most committed pass visitation declined due to conditions impact.

Non-pass lift ticket visitation

6%declined

Season-to-date through March 1

Decline in non-pass lift ticket visitation.

Resource Efficiency Transformation Plan annualized savings

$106Mexceeds initial target by $6M

Annualized by end of FY26

Expected to exceed the initial $100 million annualized savings target.

Resource Efficiency Transformation Plan one-time operating expenses

$15M

FY26

One-time operating expenses associated with the Resource Efficiency Transformation Plan.

Liquidity

$1.1B

End of Q2 FY26

Company ended the quarter with strong liquidity.

Net leverage

3.1x

Trailing 12 months EBITDA

Net leverage ratio.

Convertible debt retired

$525M

Q2 FY26

Retired using a combination of net proceeds from delayed draw term loan and cash on hand.

Quarterly dividend

$2.22maintained flat

Quarterly

Maintained quarterly dividend, not believing current cash flow decline is indicative of long-term potential.

Shares repurchased

0.3M

Year-to-date

Repurchased shares year-to-date.

Pass price increase (Epic and Epic Local)

3%-4%

2026/2027 season

Price increases for the upcoming season.

Blended pass price increase (all products)

3%-4%

2026/2027 season

Overall blended price increase across all pass products.

Young adult pass discount

20%less than standard pricing

2026/2027 season

New pricing introduced for young adults to provide a more accessible pathway.

Sales and lift tax on multi-resort passes

3%

2026/2027 season

Passing through the sales and lift tax to local communities.

Guest satisfaction scores

Record highincreases YoY in Colorado and Utah

This season

Achieved despite very challenging conditions, reflecting team member execution.

Industry KPIs

1

Metric	Value	Period	Details
Comparable sales comps	Skier visitation declined 12%; Lift revenue declined 4%%	Season-to-date through March 1

Product announcements

6

Product	Type	Timeline	Details
New pricing for skiers and riders ages 13-30	launch	launched last week (early March 2026) for 2026/2027 season
Epic and Epic Local passes	update	launched last week (early March 2026) for 2026/2027 season
Epic Day passes	update	launched last week (early March 2026) for 2026/2027 season
Epic Friends ticket	launch	this season (FY26)
1-month advanced lift tickets	launch	this season (FY26)
Off-peak pricing strategy	launch	this season (FY26)

Risks & headwinds

3

Unprecedented challenging weather in the RockiesQ2 FY26 and season-to-date

Snowfall down 43% YoY; February 9 degrees warmer than average; only 70%-80% of acres opened through February in Colorado and Utah; Q2 total net revenue declined ~5%; Q2 resort reported EBITDA declined ~8%; Skier visitation declined ~12% season-to-date.

Mitigation: Advanced commitment strategies (pass sales), geographic diversification, disciplined cost management, Resource Efficiency Transformation Plan savings.

Greater variability in full-year guidanceRemainder of FY26

Net income guidance of $144M-$190M; Resort reported EBITDA guidance of $745M-$775M.

Mitigation: Acknowledging the uncertainty and reflecting assumptions in the updated guidance range, including current conditions in North America.

Impact of reduced usage on future pass salesNext season's pass sales cycle

Less usage of lift tickets or passes due to weather conditions.

Mitigation: Proactive marketing, increased investment, new young adult discount, Epic Friends discount, and 'Turn In Your Ticket' promotion to re-engage potential customers.

What to watch in Q3 FY26

4

Pass renewal rates for 2026/2027 season

Next quarter (Q3 FY26 earnings call) and into next season

TargetStable or improved renewal rates despite challenging FY26 weather

Why it matters

Indicates long-term engagement and effectiveness of the pass program after a difficult weather year, crucial for future revenue stability.

I think what we see is that people tend to look at this in terms of how many times they may have used their pass as also an aberration that it's not really that they don't love skiing. It's not that they're not as connected to the sport, but just that the weather didn't show up this year like they may have hoped.

Q&A highlights

6

How will this season's unusually warm temperatures and low snowfall in the Rockies impact pass renewals for next year, especially in local communities?

Rob Katz stated that historically, severe weather years are viewed as aberrations by skiers and don't significantly impact long-term engagement. While it's hard to know exactly, he doesn't expect a major long-term impact on renewals, noting the low pass price helps with planning through good and bad years.

“I think what we see is that people tend to look at this in terms of how many times they may have used their pass as also an aberration that it's not really that they don't love skiing. It's not that they're not as connected to the sport, but just that the weather didn't show up this year like they may have hoped.”

asked by Shaun Kelley · answered by Robert Katz

2 min read6 chapters

Detailed Narrative

01

Impact of Unprecedented Weather

The Q2 FY26 results were severely impacted by historic low snowfall (down 43% YoY) and record warm temperatures in the Rockies, which saw February temperatures 9 degrees warmer than average. This led to the latest opening of back bowls at Vail Mountain and Imperial Lift at Breckenridge, with only 70%-80% of acres opened through February in Colorado and Utah. These conditions significantly weighed on visitation and ancillary spending, resulting in a 5% decline in Q2 total net revenue and an 8% decline in Q2 resort reported EBITDA.

02

Resilience of Advanced Commitment Strategy

Despite the challenging conditions, the company's advanced commitment strategy demonstrated resilience. Pass units have grown 55% over the past five years, with pass holders now accounting for approximately 75% of annual visitation, providing meaningful stability. Geographic diversification, with strong conditions in the East partially offsetting the Rockies, also played a role, highlighting the durability of the business model built to withstand challenging weather years.

03

Strategic Pass and Ticket Initiatives

Vail Resorts launched new products and targeted pricing adjustments for the 2026/2027 season, including a 20% discount for skiers and riders aged 13-30 to attract price-sensitive young adults. Epic and Epic Local passes saw 3%-4% price increases, with a blended 3%-4% increase overall, and the company is now passing through sales and lift taxes (approximately 3%). Early reception to Epic Friends tickets and 1-month advanced lift tickets, introduced this season, has been positive, expanding reach and strengthening the funnel into the pass business.

04

Resource Efficiency and Cost Management

The Resource Efficiency Transformation Plan continues to drive improvements in organizational effectiveness and operating leverage. The plan is now expected to exceed its initial $100 million annualized savings target by approximately $6 million by the end of FY26. For FY26, the company anticipates delivering $42 million of incremental savings versus the prior year, before approximately $15 million of one-time^📎 operating expenses. This disciplined cost management helped mitigate the financial impact of the severe weather.

05

Capital Allocation and Liquidity

The company maintains a strong balance sheet with approximately $1.1 billion in liquidity and net leverage of 3.1x trailing 12 months EBITDA. Capital allocation priorities remain consistent: reinvestment in the business (with a reaffirmed CY26 capital plan of $234 million-$239 million total spending) and balance sheet flexibility. The quarterly dividend was maintained at $2.22 per share, and the company repurchased 0.3 million shares for $45 million year-to-date, demonstrating opportunistic capital returns.

06

Guest Experience and Technology Investments

Despite the difficult operating environment, Vail Resorts achieved record high system-wide guest satisfaction scores this season, including year-over-year increases in Colorado and Utah. This is attributed to the caliber of team members and their execution. The company is also advancing guest-facing technology, including implementing a new content management system for the 2026/2027 season to enable greater personalization and agility, and enhancing the My Epic App with new functionality.

AI-generated summary of the company’s earnings call. Not investment advice.