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    WH
    Earnings call· Jun 2026(Q2 FY26)

    WYNDHAM HOTELS & RESORTS, INC. WH

    Jul 23, 2026 Source

    Executive summary

    Wyndham Hotels & Resorts Q2 FY26 — Record Pipeline Growth and Strong U.S. RevPAR Outperformance

    Wyndham Hotels & Resorts delivered a strong Q2 FY26, marked by record development pipeline growth and better-than-expected U.S. RevPAR, which grew 2%. The company saw comparable adjusted EBITDA and EPS growth of 3%, driven by lower G&A and higher ancillary revenues. While international RevPAR faced headwinds from the Middle East and the Revo portfolio, management remains optimistic about the second half, supported by resilient domestic leisure and business travel demand and ongoing technology initiatives.

    Highlights

    5

    • Development pipeline grew for the 24th consecutive quarter to a record of approximately 261,000 rooms.

    • U.S. RevPAR grew 2%, exceeding expectations by 120 basis points, with momentum accelerating from May into June.

    • Adjusted EBITDA and adjusted EPS each grew 3% on a comparable basis, reflecting lower G&A and higher ancillary revenues.

    • Returned $86 million to shareholders in Q2 FY26, including $54 million in share repurchases and $32 million in common stock dividends.

    • Global Wyndham Rewards membership enrollments grew 9% year-over-year to over 126 million members.

    Concerns

    3

    • International RevPAR declined 6% in constant currency, pressured by a 45% drop in the Middle East and underperformance of the Revo portfolio.

    • Net revenues declined 6% year-over-year, primarily due to the absence of pass-through revenues from the May 2025 Global Franchisee Conference and lower other franchise fees.

    • Marketing fund underspent by $5 million in the first half of the year, expected to overspend by approximately the same amount in the second half.

    Guidance & targets

    18
    CategoryTargetConfidence
    Ancillary revenue growth
    low to mid-teens
    medium materiality
    High
    G&A expense
    unchanged
    medium materiality
    High
    Global RevPAR growth
    flat to +1%
    high materiality
    High
    Net room growth (ex-Revo)
    4% to 4.5%
    high materiality
    High
    Net revenues
    $1.48B to $1.5B
    high materiality
    High
    Adjusted EBITDA
    $735M to $745M
    high materiality
    High
    Marketing fund balance
    breakeven
    low materiality
    High
    Adjusted net income
    $355M to $365M
    high materiality
    High
    Adjusted diluted EPS
    $4.71 to $4.83
    high materiality
    High
    Development advance spend
    unchanged
    medium materiality
    High
    Free cash flow conversion
    unchanged
    medium materiality
    High
    Long-term EBITDA growth
    high single-digits
    high materiality
    High
    Long-term RevPAR growth
    2% to 3%
    high materiality
    High
    Long-term net rooms growth
    4% to 5%
    high materiality
    High
    Long-term ancillary revenue growth
    high single digits
    medium materiality
    High
    Long-term royalty rate
    5 bps
    low materiality
    High
    U.S. RevPAR growth
    2%
    high materiality
    High
    International RevPAR growth
    improve
    medium materiality
    Medium

    Segment performance

    18
    SegmentRevenueYoYQoQMargin
    U.S.
    U.S. RevPAR grew 2%, 120 basis points ahead of expectations, with momentum accelerating from May into June. This was driven by increases in both demand and ADR. The industrial Midwest showed strong outperformance due to infrastructure-related demand. Domestic net room growth was sequential.
    Demand growth: 60 bpsADR growth: 160 bpsWeekday RevPAR increase from Q1: 250 bpsDomestic pipeline: 110,000 roomsDomestic openings YTD: 8% more rooms
    		—2%——
    Texas, California, Florida
    These three largest states, accounting for 1/4 of U.S. room count, improved significantly from down 3% in Q1 to up 4% in Q2.
    		—up 4%up 700 bps sequentially—
    Illinois
    Experienced RevPAR outperformance in Q2 FY26.
    		—up 10%——
    Indiana
    Experienced RevPAR outperformance in Q2 FY26.
    		—up 10%——
    Iowa
    Experienced RevPAR outperformance in Q2 FY26.
    		—up 9%——
    Wisconsin
    Experienced RevPAR outperformance in Q2 FY26.
    		—up 7%——
    Ohio
    Experienced RevPAR outperformance in Q2 FY26.
    		—up 6%——
    International
    International RevPAR declined in Q2 FY26, but saw sequential net room growth.
    		—down 6% (constant currency)——
    Canada
    Canada RevPAR increased in Q2 FY26.
    		—2%——
    EMEA
    EMEA RevPAR was impacted by softness in the Middle East and Revo underperformance. Excluding these, EMEA RevPAR was up 5%.
    Net room growth (ex-Revo): 10%
    		—down 6%——
    Middle East
    Significant RevPAR decline in Q2 FY26, impacting overall EMEA performance.
    		—down 45%down from 5% decline in Q1—
    Spain
    Strong market performance in Q2 FY26.
    		—up 26%——
    Turkey
    Strong market performance in Q2 FY26.
    		—up 16%——
    India
    Strong market performance in Q2 FY26.
    		—up 11%——
    Africa
    Strong market performance in Q2 FY26.
    		—up 11%——
    Latin America and the Caribbean
    RevPAR declined, pressured by Mexico. Excluding Mexico, the region was flat. Mexico is showing signs of pickup in July.
    Net room growth: 12%
    		—down 7%down from 4% decline in Q1—
    Southeast Asia and the Pacific Rim
    RevPAR grew, led by Vietnam, Thailand, and New Zealand, driven by exceptional new construction openings.
    Net room growth: 10%
    		—5%——
    China
    Wyndham's RevPAR remained flat sequentially despite a 400 basis point sequential decline in industry China RevPAR. Delivered double-digit net room growth for direct franchising system and 13% across Mainland China.
    Direct franchising system net room growth: double-digitMainland China net room growth: 13%Days Inn openings: 19 (Q2 FY26), 8 (Q1 FY26)
    		—down 5% vs Q2 FY25flat sequentially—

    Operational metrics

    45
    Share repurchases
    $54M
    Q2 FY26
    Share repurchases
    $105M
    YTD FY26

    Repurchased 1.3 million shares.

    Common stock dividends
    $32M
    Q2 FY26
    Total capital returned to shareholders
    $86M
    Q2 FY26

    Through share repurchases and common stock dividends.

    Total capital returned to shareholders
    $170M+
    YTD FY26
    Development advance spend
    $28M
    Q2 FY26
    Total liquidity
    $1B
    end of Q2 FY26
    Net leverage ratio
    3.5x
    end of Q2 FY26

    Remained at the midpoint of target range.

    Capital available for share repurchases or M&A
    $170M
    H2 FY26

    After factoring in dividends and remaining development advances.

    Marketing fund revenues vs expenses
    $14Mexceeded by $11M vs Q2 FY25
    Q2 FY26

    Revenues exceeded expenses by $14 million in Q2 FY26, compared to $3 million in Q2 FY25.

    Marketing fund underspend
    $5M
    H1 FY26

    Expected to be overspent by approximately the same amount in H2 FY26.

    Global openings
    18,000 roomsup 7% YoY
    Q2 FY26

    A second quarter record for the company.

    Development pipeline rooms
    261,000 roomsup for 24th consecutive quarter
    Q2 FY26

    Across over 60 countries, reflecting strategy of adding hotels in higher chain scales and stronger long-term economic geographies.

    Development advances FeePAR premium
    40%
    historical

    Relative to system average for hotels with development advances.

    Ancillary revenues growth
    4%
    Q2 FY26
    Ancillary revenues growth
    12%
    YTD FY26

    Aided by new Wyndham Rewards credit card products and strategic partnership initiatives.

    Wyndham Connect installed hotels
    5,000+
    to date

    AI-enabled guest engagement platform being rolled out internationally.

    Wyndham Connect guest messages
    40M+
    to date
    Wyndham Connect daily guest interactions
    260,000
    per day

    Via AI tool.

    Wyndham Connect incremental revenue
    $100,000+
    per engaged franchisee

    Generated by autonomously selling services, upgrades, and amenities.

    Wyndham AI Concierge increased direct contribution
    500 bps
    current

    Premium add-on expanding internationally, managing direct-to-hotel voice and messaging contacts.

    Wyndham AI Concierge ADR increase
    15%
    current

    For autonomous bookings versus on the phone.

    Wyndham Rewards direct contribution
    1 out of every 2
    current
    Global membership enrollments growth
    9%
    YoY
    Global membership base
    126M+
    Q2 FY26

    Grew by another 2.5 million members in Q2 FY26.

    Wyndham Rewards new members added
    2.5M
    Q2 FY26

    Contributed to global membership base growth.

    Retention rate
    95%
    rolling 12-month

    At the end of Q2 FY26.

    Retention rate
    95.9%
    rolling 12-month
    Economy comp
    down 4%
    Q2 FY26
    Economy comp
    down 5%
    Q3 FY25
    Economy comp
    down 8%
    Q4 FY25
    Booking lead times
    15 daysholding steady
    current
    Average distance driven
    360 milesup 30 miles from Q1
    summer

    Consistent with last year despite gas prices.

    Tax refunds spent on travel
    $4B
    this year

    Estimated for middle-income guests, representing 70% of the $60 billion total tax refunds spent on travel.

    Oil and gas markets outperformance
    350 bps
    Q2 FY26
    Oil and gas markets rooms share
    11%
    current

    Represents 11% of the company's rooms.

    Comparable adjusted EBITDA
    $363M
    H1 FY26

    Used as baseline for H2 EBITDA calculation.

    Implied back half adjusted EBITDA
    $377Mup $14M vs H1
    H2 FY26

    Implied from full year guidance and H1 actuals, assuming marketing funds breakeven.

    Key money deployment
    $100M to $110M
    annual

    Remained in this range despite increased competition.

    Key money deals percentage
    3 out of every 10
    current
    World Cup RevPAR impact
    25 bps
    Q2 FY26

    Similar expectation for July.

    Occupancy vs 2019 levels
    90%
    current

    Suggests about 10% more tailwind for occupancy.

    Domestic upper mid-scale conversion market share
    25%doubled from pre-spin
    current
    Domestic upscale conversion market share
    8%up from 4%
    current
    Economy conversion share
    63%up from 44% in 2019
    current

    Industry KPIs

    2
    MetricValueDetails
    Comparable sales comps2%%
    Net unit growth development pipeline261,000 roomsrooms

    Product announcements

    2
    ProductTypeDetails
    Wyndham Rewards Credit Card Portfoliolaunch
    Wyndham Rewards Award Tiersexpansion

    Deals & partnerships

    1
    BarclaysReimagined Wyndham Rewards credit card portfolio

    Partnership to launch a refreshed credit card lineup, including four distinct products (no-fee, premium, business, and elite offerings) and the Earner Premier Card.

    Risks & headwinds

    6
    International RevPAR declineQ2 FY26

    down 6% in constant currency

    Mitigation: Expect recovery in H2 FY26, Mexico RevPAR picking up (+5% MTD July).

    Middle East RevPAR softnessQ2 FY26

    down 45% in Q2 FY26 (from down 5% in Q1 FY26)

    Mitigation: Middle East is less than 1% of system; cautious but fluid situation.

    Revo portfolio underperformance and insolvencyQ2 FY26 (underperformance), Q3/Q4 FY26 (termination)

    deferred all revenues; majority of portfolio expected to terminate

    Mitigation: Remained disciplined from a capital perspective; expect to retain a subset of rooms and revisit revenue deferral.

    Net revenue declineQ2 FY26

    down 6% YoY

    Mitigation: Primarily due to absence of pass-through revenues from May 2025 Global Franchisee Conference and lower other franchise fees; partially offset by higher ancillary revenues and larger global system.

    Increased interest expenseQ2 FY26

    increased interest expense

    Mitigation: Partially offset adjusted diluted EPS growth.

    Marketing fund seasonalityH1 FY26

    underspent by $5M in H1 FY26

    Mitigation: Expected to overspend by approximately $5M in H2 FY26, roughly consistent between Q3 and Q4, with full year breakeven unchanged.

    What to watch in Q3 FY26

    5

    Marketing Fund Balance

    Q3 FY26, Q4 FY26
    CurrentUnderspent by $5M in H1 FY26
    TargetOverspend by $5M in H2 FY26, with amount roughly consistent between Q3 and Q4.

    Why it matters

    Marketing fund balance impacts reported profitability and cash flow, and its expected shift from underspend to overspend will affect H2 results.

    With respect to seasonality, the marketing funds underspent by $5 million in the first half of the year, and we expect the funds to overspend by approximately the same amount in the second half, with the amount roughly consistent between the third and fourth quarters.

    Q&A highlights

    6

    Seeking insights on the sustainability of U.S. RevPAR growth and the longer-term outlook for consumer health.

    Geoff Ballotti expressed confidence in the sustainability of U.S. RevPAR growth, citing the relatively good shape of middle-income consumers despite affordability issues. He highlighted easing comps, strong leading indicators (improving cancellation rates, steady booking lead times, increased average distance driven, longer length of stays), anticipated tax refunds unlocking discretionary spending, and robust wage growth. He also noted continued improvement in infrastructure-related business and strong private sector growth.

    “When we look at our middle-income consumers who, despite the affordability issues and not being happy about gas prices, they're in relatively good shape. And I think we all feel good about and very optimistic about the second half and the year ahead for several reasons.”

    asked by David Katz · answered by Geoffrey Ballotti

    2 min read6 chapters

    Detailed Narrative

    01

    CEO's Health and Gratitude

    CEO Geoff Ballotti opened the call by thanking stakeholders for their well wishes during his treatment for multiple myeloma, expressing optimism about his treatment path and continued engagement with work. He conveyed a strong sense of gratitude and highlighted the support from his team, setting a positive tone for the call.

    02

    Infrastructure-Related Demand Driving U.S. RevPAR

    The company highlighted sustained strength in the industrial Midwest, with RevPAR outperformance in states like Illinois (+10%), Indiana (+10%), Iowa (+9%), Wisconsin (+7%), and Ohio (+6%) in Q2 FY26. This momentum is attributed to infrastructure-related demand, which is boosting midweek occupancy and providing a meaningful source of long-term growth for franchisees, particularly in project-adjacent markets serving large transportation, AI, data center, and industrial projects.

    03

    Wyndham Connect AI Platform Expansion and Impact

    Wyndham Connect, an AI-enabled guest engagement platform powered by a Wyndham-trained LLM, is rolling out internationally, with over 5,000 hotels installed. The platform improves guest service and generates incremental revenue by autonomously selling services, upgrades, and amenities, driving upwards of $100,000+ in increased revenues for engaged franchisees. The premium add-on, Wyndham AI Concierge, is also expanding internationally, driving over 500 basis points of increased direct contribution by managing direct-to-hotel voice and messaging contacts and autonomously booking reservations, achieving a 15% higher ADR for autonomous bookings.

    04

    Wyndham Rewards Program Enhancements and Member Engagement

    In partnership with Barclays, Wyndham reimagined its Wyndham Rewards credit card portfolio, introducing four distinct products (no-fee, premium, business, elite) to target specific demographics and drive long-term ancillary fee growth. The program is also expanding from three to four award tiers in September, with free nights starting as low as 5,000 points (versus 7,500 previously) and a new 45,000-point tier for aspirational hotels. Wyndham Rewards was again named the #1 hotel rewards program by U.S. News & World Report, with global membership enrollments growing 9% year-over-year to over 126 million members.

    05

    Owner-First Value Proposition and Retention Strategy

    Wyndham's owner-first strategy continues to drive strong openings and net room growth, with a focus on replacing lower-quality, lower FeePAR rooms with higher-quality, higher FeePAR rooms in accretive markets. The company's global retention rate stands at 95% on a rolling 12-month basis, with a long-term goal of reaching 96% domestically and internationally. Management noted that less than 1% of former Wyndham hotels reflagged to new competitors, indicating minimal impact on development growth.

    06

    Revo Portfolio Insolvency Nearing Conclusion

    The Revo insolvency process is nearing conclusion, with the majority of the portfolio expected to terminate during Q3 and Q4 FY26. Wyndham expects to retain a subset of Revo-related rooms and will revisit the deferral of revenue for these hotels once new franchise agreements are in place. The company has remained disciplined from a capital perspective regarding further investments in the Revo portfolio.

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