Travel + Leisure Co.

Greetings, and welcome to the Traveler Leisure Second Quarter 2025 Earnings Conference Home Webcast. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. You may be placed into question queue at any time by pressing star 1 on your telephone keypad. We ask that you please ask one question and one follow-up, then return to the queue. If anyone would require operator assistance, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to introduce your host, Eric Hoke, Chief Financial Officer. Please go ahead, sir.

Thank you, Kevin. Good morning to everyone. Before we begin, we would like to remind you that our discussions today will include forward-looking statements. Actual results could differ materially from those indicated in the forward-looking statements, and the forward-looking statements made today are effective only as of today. We undertake no obligation to publicly update or revise these statements. The factors that could cause actual results to differ are discussed in our SEC filings and in our press release accompanying the earnings call. You can find a reconciliation of the non-GAAP financial measures discussed in today's call in the earnings press release available on the Investor Relations website. This morning, Michael Brown, our President and Chief Executive Officer, will provide an overview of the second quarter results and our longer-term growth strategy, and then I'll provide greater detail on the quarter, our balance sheet, and outlook for the rest of the year. Following our prepared remarks, we'll open up the call for questions. Finally, all comparisons today are to the same period of the prior year, unless specifically stated. With that, I'm pleased to turn the call over to Michael Brown.

Good morning, and thanks for joining us. Travel and Leisure delivered another solid quarter of revenue and adjusted even at growth. Our strong adjusted EBITDA or free cash flow allowed us to return $107 million of capital to shareholders in the quarter. This performance underscores the strength of our brands, the resilience of leisure travel and our owner base, and the disciplined execution of our strategy. Against the dynamic macroeconomic backdrop, our teams remain focused on driving growth, managing costs, and delivering exceptional experiences to our owners, members, and guests. In the quarter, we generated over $1 billion in revenue, $250 million in adjusted EBITDA, and $1.65 in adjusted earnings per share, all of year over year. Our results were driven by continued strength in our vacation ownership business, which more than offset softer performance in travel and membership. We saw healthy year-over-year growth in VOI sales, with gains in both tour flow and volume per guest. Notably, volume per guest of $3,251 was above the high end of our guidance range, and adjusted EBITDA margin remained consistent with the prior year at 25%. These results support the core foundation of our business, a resilient customer base built around leisure travel, a compelling value proposition, and consistent returns to our shareholders. Demand remains strong across our core timeshare business. We see encouraging engagement from consumers as tour growth improved sequentially from the first quarter and 3% compared to 2024. The resilience of our platform is directly related to the quality of our customers. There's been plenty of noise around the economy, but from where we sit, our consumers are healthy and prioritizing travel. Spending on leisure travel is expected to grow mid-single digits per year over the next five years. Our business is built on recurring behavior and less so on short-term trends, making us less sensitive to the macro economy as we benefit from a highly visible recurring revenue base. More than 75% of our revenue is tied to predictable sources like owner upgrades, financing, and management fees, which leads to a nearly $20 billion pipeline of future potential revenue over 10 years. We see our strategy play out through our bookings, sales tours, and owner engagement metrics. Our owners are traveling, supporting what we've long believed, that vacations are not discretionary, they're essential. We have seen no significant change in buyer behavior related to booking pace, VPG, and portfolio performance. Booking pace is relatively consistent to the prior year, and with a 109-day average booking window, we have clear visibility into the remainder of the year. VPG performance continues to be strong, and our portfolio remains stable. Our owners know what they are getting, They've already planned for it, and 80% of them have fully paid for their ownership. Today, we serve more than 800,000 owner families with an average tenure of 17 years. Here are some key characteristics of our owner base. The average household income for our owners is approximately $118,000. The average FICO score of our $3 billion portfolio is above 720. Since 2020, we have seen sub 640 FICO loans decline four points as a percentage of the overall portfolio. The average FICO score of new originations is 746. This is an over 20 point increase since we updated our credit quality standards. Our owners take an average of four to five vacations annually with more than 50% of their vacation time being utilized through their ownership. We are seeing consistent interest from younger generations with over 65% of new buyers coming from Gen X, Millennial, and Gen Z households. Our product delivers exactly what these new owners want, flexibility, convenience, and personalized experiences. During the quarter, we continue to invest in technology, marketing, and product innovation to enhance the customer journey and extend our reach. Our Club Wyndham app, which offers frictionless engagement, now has 162,000 downloads and accounts for 19% of bookings. Additionally, we are preparing for the launch of our WorldMark app in Q4. We are progressing with investments in AI on our web and app channels, driving recommendations for personalized experiences and seamless booking process. During the quarter, we announced an exclusive marketing partnership with Hornblower, focused on creating memorable experiences for our owners, as well as new owner tour generation. Hornblower Group is an experience-based tourism leader across 22 destinations in the United States, Canada, and the UK. Looking ahead, we are focused on growing the core vacation ownership business, leveraging data and technology to enhance the customer experience across all platforms. We are taking targeted revenue and cost actions to mitigate the headwinds in our travel and membership segment, leaving us well-positioned to deliver sustainable growth and consistent returns. Now turning to execution on our multi-brand strategy. This strategy is not just about scale, it's about customer segment. It's about both customer segment and geographic expansion. Our Club Wyndham and Walmart brands will continue to be the cornerstone of our vacation ownership business, along with our Blue Thread partnership with Wyndham Hotels. In June, we expanded our Margaritaville footprint with a new sales location in Nashville on Broadway and a new marketing channel on the Margaritaville cruise ship. we launched and expanded the Accor Vacation Club with the formation of a new Asia-based club. The first resort is the Novatel Nusa Dua in Indonesia. And last week, we announced our newest Sports Illustrated Resort's location in Nashville, Tennessee. Located on Music Row in the heart of Midtown, just one mile from downtown, the planned resort will feature 185 units, and is expected to open in the spring of 2026. These new brands will help us expand into key markets, reach new audiences, and offer experiences suited to their lifestyles. Our strong free cash flow allows us to invest in the right places, brand, digital, and targeted inventory. We're confident these investments will continue to drive value Alongside these investments, we continue to consistently return capital to our shareholders through our dividend and share repurchase program. Since then, we have returned $2.7 billion to shareholders. Before I hand it over, I'd like to take a moment to welcome Eric Hogue, our new Chief Financial Officer. Eric brings a strong background in strategy, operational finance, and capital allocations. Eric has hit the ground running since he joined the company. In his first two months, he has attended five conferences and met with 49 investors over 27 meetings. I'm confident his leadership will help us continue delivering disciplined execution and long-term value for our shareholders. With that, I'll hand it over to Eric to walk through our financial performance and capital allocation in more detail. Eric.