Inspirato Incorporated

Good day, ladies and gentlemen. Thank you for standing by. And welcome to the second quarter 2022 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1-1. Please be advised that today's conference may be recorded. I would now like to hand the conference over to your speaker host today, Kyle Sork of Investor Relations. Please go ahead.

Thank you and good morning. On today's call, we have co-founder and CEO Brent Handler and CFO Webb Naber. Earlier this morning, we issued our press release announcing our second quarter results and posted an updated investor presentation, both of which are available on the investor relations page of our website at investor.inspirato.com. Before we begin our formal remarks, we remind everyone that some of today's comments are forward-looking statements. including but not limited to our expectations of future operating results and financial position, guidance and growth prospects, our anticipated future expenses and investments, business strategy and plans and market growth, market position and potential market opportunities. These statements are based on assumptions and we assume no obligation to update them. Actual results could differ materially. We refer you to our SEC filing for a more detailed discussion of additional risks. In addition, during the call, management will discuss non-GAAP measures, which are useful in evaluating the company's operating performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. Reconciliations of these measures to the most directly comparable GAAP measures are included in our earnings release. With that, I'll turn the call over to our CEO, Brent Handler.

Thank you, Kyle, and good morning, everyone. Before we begin, I want to thank our tremendous team at Inspirato. This period of rapid growth is incredibly exciting but can present many changes and challenges. Your hard work is not going unnoticed, and we are extremely grateful. As we highlighted in our press release this morning, we're incredibly pleased with our second quarter results. which were strong from a top line revenue standpoint, and once again established several new company records. While Inspirata was not immune to macro headwinds, we believe we are extremely well positioned to execute on both our short and long term plans. As such, we are reiterating our full year revenue guidance of 350 to 360 million, and our full year adjusted EBITDA loss guidance of 15 to 25 million. The growth we are seeing in our total subscription count, coupled with our resilient model and high net worth customer base, lend confidence to our expectation of positive adjusted EBITDA for the full year 2023. 2023 would then match 2019 and 2020 as years in which Inspirata was both adjusted EBITDA and cash flow positive, key performance markers that differentiate us from many of our peers. In terms of the second quarter, we generated $84 million in total revenue, a 60% increase year-over-year. Our subscription revenue of $36 million for the quarter represents 50% growth from the same period in 2021, primarily driven by the continued adoption of our Inspirato PATH subscription offering. PATH subscriptions are up 75% year-over-year to approximately 3,600. Meanwhile, total active subscriptions at quarter end came in at nearly 15,700, which is in line with our internal plan. It is important to note that generally speaking, we have a sticky subscriber base of wealthy travel enthusiasts that provide predictable revenue streams from both a subscription and travel standpoint. Our subscribers enjoy the benefits of the high quality, high touch travel experience we deliver, and it shows in our industry-leading NPS scores, a satisfaction metric we monitor closely as it engenders tremendous customer loyalty. Approximately 6,000 subscribers have been with us for five years or more, and quite a few of those have a tenure with us of 10 years or more. As we described on our last call, seasonality plays a large role in our business, and we typically see that in second quarter results from both a revenue and cost standpoint. as much of the quarter is considered shoulder season for many of our core destinations. Despite this, we set new company records for total nights delivered and total nights booked, and a quarter end record for our 12-month forward booking backlog. Webb will provide more detail on each of these in a minute. While we think the peak of the pandemic revenge travel may be behind us, we believe our customer segment in particular is living a new normal, where work and school calendars enable more flexible lifestyles and more frequent travel than before the pandemic. Our incredible residences, hotel suites and penthouses, and one-of-a-kind travel experiences leave us well positioned to continue to serve this new travel demand among our subscriber base. Which brings me to supply growth. We discussed last quarter that we added 37 residences in the Hamptons, a prime example of a strategic foothold in a Tier 1 market. We added a net new 49 controlled accommodations this quarter and exited the quarter with more than 700, an increase of 67% compared to a year ago. We will continue to pursue expansions in sought-out destinations that offer value and utility to our subscriber base. Webb will touch on this more, but it's extremely important to note that onboarding new properties can naturally lead to some short-term margin compression related to upfront home investments, initial staffing needs, and integration of the property onto our platform. That said, the relative impact of adding new controlled accommodations is diluted over time as the portfolio continues to grow. Finally, I want to touch on Inspirato Select, which was introduced late in the second quarter and is our most flexible subscription offering to date, with a constantly updating list of hundreds of thousands of select trips that are completely shareable. While this didn't impact our quarter given the timing of the launch, we've used Select as a way to significantly increase our TAM through two initiatives we are working on, Inspirato for Business and Inspirato for Good. both of which have been soft launched. We've previously discussed the reverse inquiry for rewards travel from a global Fortune 500 software company in particular, and are now building a product and business unit around the massive corporate opportunity. Inspirato for Business is a flexible platform that caters to corporate incentive programs. Equally as exciting, Inspirato for Good is designed as a turnkey solution that amplifies non-profits fundraising efforts. Look for updates on each of these growth initiatives in the coming quarters. In summary, our team is incredibly focused on executing our plan. While there are obvious macroeconomic headwinds to navigate, we are confident that our resilient and predictable business model, combined with the exciting untapped opportunities around expansion, position us well to grow sensibly and profitably in the near and medium term. With that, I'll turn the call over to Webb to discuss our results in more detail.