NYSE:WH Wyndham Hotels & Resorts Q1 2025 Earnings Report $83.44 -0.67 (-0.80%) Closing price 03:59 PM EasternExtended Trading$83.42 -0.02 (-0.02%) As of 06:40 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast Wyndham Hotels & Resorts EPS ResultsActual EPS$0.86Consensus EPS $0.82Beat/MissBeat by +$0.04One Year Ago EPS$0.78Wyndham Hotels & Resorts Revenue ResultsActual Revenue$316.00 millionExpected Revenue$320.10 millionBeat/MissMissed by -$4.10 millionYoY Revenue Growth+3.60%Wyndham Hotels & Resorts Announcement DetailsQuarterQ1 2025Date4/30/2025TimeAfter Market ClosesConference Call DateThursday, May 1, 2025Conference Call Time8:30AM ETUpcoming EarningsWyndham Hotels & Resorts' Q2 2025 earnings is scheduled for Wednesday, July 23, 2025, with a conference call scheduled on Thursday, July 24, 2025 at 8:30 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)SEC FilingEarnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Wyndham Hotels & Resorts Q1 2025 Earnings Call TranscriptProvided by QuartrMay 1, 2025 ShareLink copied to clipboard.PresentationSkip to Participants Operator00:00:00Welcome everyone to the Wyndham Hotels and Resorts First Quarter twenty twenty five Earnings Conference Call. At this time, all participants have been placed in a listen only mode and the floor will be open for your questions following the presentation. I would now like to turn the call over to Matt Cappuzzi, Senior Vice President of Investor Relations. Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:00:40Thank you, operator. Good morning and thank you for joining us. With me today are Jeff Pilate, our CEO and Michelle Allen, our CFO and Head of Strategy. Before we get started, I want to remind you that our remarks today will contain forward looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:01:02These risk factors are discussed in detail in our most recent annual report on Form 10 ks filed with the Securities and Exchange Commission and any subsequent reports filed with the SEC. We'll also be referring to a number of non GAAP measures. Corresponding GAAP measures and a reconciliation of non GAAP measures to GAAP metrics are provided in our earnings release and investor presentation, Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:01:28which Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:01:28are available on our Investor Relations website at investor.wyndhamhotels.com. We are providing certain measures discussing future impact on a non GAAP basis only because without unreasonable efforts, we are unable to provide the comparable GAAP metric. In addition, last evening, we posted an investor presentation containing supplemental information on our Investor Relations website. We may continue to provide supplemental information on our website and on our social media channels in the future. Accordingly, we encourage investors to monitor our website and our social media channels in addition to our press releases, filings submitted with the SEC and any public conference calls or webcasts. Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:02:15With that, I will turn the call over to Jeff. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:02:18Thanks, Matt. Good morning, everyone, and thanks for joining us today. Despite an uncertain macro environment, we delivered a very solid start to the year. Adjusted EBITDA grew 9% on a comparable basis and adjusted EPS increased 20%. We grew our global system by 4% and our pipeline by 5% to a record 2,143 hotels. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:02:44We saw healthy increases in both our U. S. And our international royalty rates. We drove continued growth in our ancillary fee streams and we returned nearly $110,000,000 to our shareholders. Global RevPAR grew 2% in constant currency. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:03:03International RevPAR grew in all regions except China. Latin America RevPAR grew by 25% excluding Argentina's hyperinflation with both strong ADR and higher fee par additions in Mexico and in The Caribbean. EMEA RevPAR rose 6% with solid performance in Germany, Turkey, India and Greece. And Southeast Asia and The Pacific Rim posted year over year RevPAR growth of 8%. And in China, demand remained steady, but RevPAR declined 8% year over year reflecting continued pricing pressure. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:03:40As you've all been tracking through STR, while U. S. RevPAR started strong in January, momentum softened in February and March as consumer sentiment weakened. Our results finished about three points below our expectations, growing 2% for the quarter or up 60 basis points when normalizing for the benefit from hurricanes and the Easter shift to Q2. Excluding these benefits, pricing power still remains steady, increasing 110 basis points for the quarter against a 50 basis point decline in demand. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:04:17When normalizing for the timing of Easter and the lapping of last year's solar eclipse, April month to date RevPAR in The U. S. Is down 3% consistent with what we saw in March on a normalized basis. And while March and April results have trended below the expectations we had assumed in our original outlook and Michelle will take you through our revised outlook in a moment. Recent trends are now more encouraging indicating positive momentum as we head into the busy summer travel months. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:04:47Whatever demand scenario may transpire, our brands have always outperformed in periods of economic downturn relative to the overall industry. Following nineeleven, RevPAR for our select service hotels outperformed STR's upscale and above segments by 300 basis points during the global financial crisis by 500 basis points and during COVID by 2,500 basis points. Wyndham's track record of industry outperformance is not coincidental. It reflects the structural advantages of our select service model and the nature of the demand that we serve. With limited reliance on white collar corporate and group travel, which tends to contract most during economic downturns, our business is anchored by a stable and resilient base of essential frontline blue collar workers, a guest segment that continues to drive consistent demand even as broader corporate discretionary travel budgets tighten. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:05:51This segment has shown resilience through prior cycles and we expect it to do the same in any macroeconomic setup. Moreover, we are far less impacted by the current international inbound demand declines. Less than 3% of our bookings in The United States arrive from international inbounds, including less than 2% from Canada. Approximately 90% of our footprint is concentrated in drive to markets where leisure demand is less impacted by the cost and the complexity of air travel. Our brands are attractively priced relative to upscale full service hotels, positioning Wyndham to capture trade down demand from both leisure and business travelers seeking value. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:06:35We outperform in times of economic distress because our model is different. During economic down cycles, we've continued to grow our system. Amid softer demand environments, hotel owners consistently turn to brands at scale that they know and that they trust and brands that outperform their competitors seeking broad distribution, a loyal customer base, operational support and cost efficiencies. As independent and underperforming branded hotels face mounting pressure, Wyndham offers the tools and the support needed to compete more effectively. And as investment in U. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:07:14S. Manufacturing accelerates, particularly in secondary markets, our existing system and pipeline of select service and extended stay hotels are located in regions where demand is growing. Whether it's in markets driven by the onshoring that new tariffs are creating, whether it's in markets that are beginning benefit from large infrastructure projects that are finally beginning to break ground from the federal infrastructure bill where allocations are ramping or whether it's from new private sector investments in large data center projects across the country, Wyndham's portfolio is well positioned to serve the everyday travel that these markets will benefit from in the decade ahead. Our continued momentum on the development front speaks volumes, reflecting not only the strength of our value proposition to owners, but also the confidence that they have in our ability to perform in any range of market conditions. This was a record first quarter for us in terms of room additions. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:08:20We opened 15,000 rooms, 13% more than we did last year and our development teams drove sequential net room growth across every region we operate in. We signed 6% more deals than a year ago, expanding our pipeline for the nineteenth consecutive quarter to a new all time high of 254,000 rooms, representing an average fee par premium of over 30% versus our current domestic and international systems. Domestically, our midscale and above brands grew 4% driven by conversions like the Wyndham Avanti Resort and Conference Center on International Drive in Orlando and new construction openings like the La Quinta Hotel in La Habra in Orange County, California. New Echo Suites and Hawthorne Suites openings continued across Texas, Virginia and Wyoming, reflecting growing developer interest in our extended stay new construction prototypes. Prototypes. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:09:25Internationally, we grew net rooms by 7%. With continued strong interest in our brands across Europe, The Middle East and Eurasia, our team grew the pipeline by nearly 40% and net rooms for the quarter by 5% with new construction additions like the La Quinta Batumi Beach in Georgia's coastal hotspot. Latin America grew its pipeline by 9% and increased net rooms by 10% with high quality conversions like the Wyndham All Trip Punta Cana Resort and new construction hotels like the new Trip by Wyndham Guzman located in the heart of Jalisco, the Mexican birthplace of tequila. In Southeast Asia in the Pacific room, net rooms grew by 14% including the debut of our Wyndham Grand brand in Phnom Penh, Cambodia. And in China, our team doubled our direct franchising system openings and grew net direct franchise rooms by 17% with both spectacular new conversions and beautiful new construction additions like the Days Inn by Wyndham Shantou Jingping, our one hundredth Days Inn in China. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:10:41By contrast, our legacy master license franchisees in China grew at a much slower pace, up less than 2% year over year. Excluding our China master license fees, Global System growth would have been 30 basis points higher than our headline growth rate, underscoring our strategic focus on accelerating growth within our direct franchising platform internationally, where we continue to see stronger FPAR and greater revenue potential in the quarters and the years ahead. As we prioritize our development growth in higher FPAR geographies and higher chain scales, as we build scale in markets where we already have significant density, and as we expand our direct franchising in select regions previously heavily reliant on master licensee relationships, the hotels we're adding are entering the system with a stronger economics, contributing to meaningful royalty rate accretion, which is beginning to pay off. This quarter for example, our royalty rate increased by 19 basis points domestically and by 15 basis points internationally. By continuing to remix our portfolio towards higher fee par hotels, we're elevating the long term earnings power of our system. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:12:03We also continued to see strong momentum in our ancillary fee growth this quarter, driven by our renewed co branded credit card agreement, our growing partnership initiatives and our ongoing technology innovations. New Barclays accounts rose 11% and spend volumes increased 7%. Our new debit card, which was launched this quarter, is attracting a much younger demographic into our ecosystem. And we recently announced a new partnership adding Carnival Cruise Lines to Wyndham Rewards, giving our loyalty members even more ways to explore, to earn and to make the very most out of their vacations. Finally, we want to recognize our phenomenal team members around the world. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:12:50For the third straight year and the fifth time overall, Wyndham was named one of the world's most ethical companies by Ethisphere. This honor reflects the care, the commitment and the integrity that our teams bring to their work every day and it's what makes Wyndham such a great place to work and a great company to partner with. In closing, while the current demand environment is uncertain, our focus remains firmly on the long term. We've been here before. And each time, we've stayed grounded in what we do best, growing our system, supporting our franchisees and advancing the strategic initiatives that strengthen our business over time, which is exactly what we're focused on doing right now. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:13:37Our value proposition is stronger than ever. It's powered by our world class teams, a best in class technology stack, the industry's number one loyalty program and a resilient asset light business model designed to perform through all phases of any economic cycle. We remain confident that our growth strategy will continue to deliver meaningful value for all of our stakeholders. And with that, I'll now turn the call over to Michelle. Michelle? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:14:08Thanks, Jeff, and good morning, everyone. I'll begin my remarks today with a detailed review of our first quarter results. I'll then review our cash flows and balance sheet followed by our outlook. Before we begin, let me remind everyone that the comparability of our quarterly results is impacted by the timing of our marketing fund spend. In the first quarter of this year, fund expenses exceeded revenues by $22,000,000 compared to expenses exceeding revenues by $14,000,000 in the first quarter of last year. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:14:39To enhance transparency and provide a better understanding of the results of our ongoing operations, I will be highlighting our results on a comparable basis, which neutralizes In the first quarter, we generated $316,000,000 of fee related and other revenues and $145,000,000 of adjusted EBITDA. Fee related and other revenues increased $12,000,000 year over year, principally reflecting a 9% increase in royalties and franchise fees as well as higher ancillary revenues. The increase in royalties and franchise fees reflects system sales of 4%, royalty rate improvement of 16 basis points and higher other franchise fees. Our ancillary revenue growth was primarily driven by higher credit card and partnership fees as well as increased license fees. Adjusted EBITDA grew 9% on a comparable basis, primarily reflecting the higher fee related and other revenue and approximately 60 basis points of margin improvement. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:15:43First quarter adjusted diluted EPS was $0.86 up 20% on a comparable basis due to EBITDA growth, the benefit of share repurchases and lower depreciation and amortization, partially offset by higher interest expense. First quarter free cash flow was $80,000,000 converting from adjusted EBITDA at approximately 55% in line with our expectations. We returned $109,000,000 to our shareholders in the first quarter through $76,000,000 of share repurchases and $33,000,000 of common stock dividends. Amid broader market volatility and a meaningful share price decline during the quarter, we accelerated buybacks repurchasing 35% more than we did in the first quarter of twenty twenty four. We closed the quarter with approximately $640,000,000 in total liquidity and our net leverage ratio of 3.5 times remained as expected at the midpoint of our target range. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:16:49Turning now to outlook. While first quarter global RevPAR performed in line with our full year expectations, as Jeff mentioned, we had anticipated stronger performance, especially in March, given the relative ease of the year over year comparison. With trends remaining softer through April, we are refining our 2025 outlook to reflect a more cautious view of industry wide RevPAR performance for the remainder of the year. Our current assumption is that full year constant currency global RevPAR will range between down 2% to up 1%. The high end of this range assumes the remaining nine months of the year perform largely in line with our original outlook, essentially implying a swift resolution to the current global trade tensions and a corresponding improvement in consumer sentiment. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:17:44While that may prove optimistic, we believe it provides a useful reference point for modeling purposes. Conversely, the lower end of the range reflects RevPAR performance more consistent with the trends we saw in March and April where the rest of the year declined about 3%. Given the current uncertainty and limited long term visibility, we believe this new guidance is a reasonable lower bound for planning purposes, wider than what we typically provide, but a prudent response in today's volatile macro environment. To help frame the potential variability, we've provided RevPAR sensitivities on slide 21 of our investor presentation. Every one point change in RevPAR equates to an approximate $10,000,000 impact to fee related and other revenues and $4,000,000 impact to adjusted EBITDA. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:18:37There are no changes to our net room growth outlook. Fee related and other revenues is now expected to be $1,450,000,000 to $1,490,000,000 down from our prior outlook of $1,490,000,000 to $1,510,000,000 This decline is roughly split evenly between royalties and franchise fees and marketing reservation and loyalty revenues. As we navigate this environment, we're taking prudent action to manage expenses carefully, which is allowing us to meaningfully offset much of the revenue impact at the EBITDA line. Adjusted EBITDA is now expected to be between $730,000,000 and $745,000,000 down 10,000,000 to $15,000,000 from our prior outlook. Adjusted net income is projected to be $358,000,000 to $372,000,000 and adjusted diluted EPS is projected at $4.57 to $4.74 which reflects the first quarter share repurchases and is based on a diluted share count of 78,400,000.0. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:19:44As usual, our EPS outlook assumes no share repurchase activity or incremental interest expense associated with any potential borrowing activity. Free cash flow conversion before development of Fantas is expected to be approximately 57%. There is no change to our development advance spend outlook. As it relates to our marketing funds, our expectation remains that at the RevPAR levels we're now guiding to, the funds will breakeven on a full year basis give or take a few million dollars. We also expect the marketing funds will breakeven in the second quarter. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:20:20Our business model is built for resilience. We no longer own hotels. We no longer carry management or performance based operating guarantees and nearly 100% of our system is franchise, making Wyndham the most asset light business in the industry. Our strong balance sheet enables us to stay focused on our long term growth strategy, disciplined capital allocation and the flexibility to lean in when opportunities arise. Together these strengths position us to unlock long term value and deliver meaningful returns for our shareholders regardless of near term dynamics. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:20:55With that, Jeff and I would be happy to take your questions. Operator? Operator00:21:25We'll take our first question today from Lizzie Dove with Goldman Sachs. Please go ahead. Your line is open. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:33Hi, there. Thanks for taking the question. First off, Jeff, just wanted to say a big congratulations on the new addition to your family last week. It's exciting news. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:21:42Thanks very much, Lizzie. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:44Yes. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:21:44It's exciting. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:45Course. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:21:45Four daughters and now three grandsons in two short years. It's amazing how fast that happens. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:52That's awesome. That's awesome. So on the question, I appreciate all the comments around the range of outcomes for RevPAR outlook, super helpful. I guess looking at The U. S. Lizzie DoveVice President Equity Research at Goldman Sachs00:22:01Specifically, could you share a little more about what you've been seeing and just put a finer point on what has changed? I think last quarter the makeup of the outlook of 2% to 3% in The U. S. Was about 150 basis to 200 basis points infrastructure, then another 50 basis on leisure, 50 basis on pricing power. So when you think of that makeup now, I'm just curious how that buildup is different today? Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:22:22Sure. It's probably a little bit different on the infrastructure side and we could talk about that in a second. But to your first part of your question in terms of what we're seeing, I'd say we're all still optimistic on the team Lizzie. Normalized April demand was performing as Michelle said, similarly to March. But that was until last week where we saw RevPAR improved by 400 basis points, running about a full point ahead of prior year. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:22:50So the pace for May, '20 days out with a third of our business on the books is trending in line with our revised outlook with pricing holding firm. I think that's really important. Our franchisees realize that there is still pricing power out there that their ADRs are still well below inflation and well a good room for ADRs to run. And I've got to give a shout out to our teams who are working so hard to communicate with our franchisees our revenue management best practices to really drive rate and margin. We have a global conference coming up in a couple of weeks and that will be what we're talking about, ensuring that franchisees are building that base business with contracted negotiated business, really taking advantage of all of our on demand and digital marketing to drive occupancy. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:23:42So pricing holding firm, majority of our franchisee revenue, you know, I think it was your question to Michelle on last month's call, is there seasonality? There is. A third of our hotels full year demand shows up in June, July and August. And so we're exiting April with momentum. And we're encouraged that leisure transient will pick up into the summer months. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:24:06And there are lots of other reasons for that optimism. Our cancellation rates are holding steady. They're not ticking down. Our average lead times are holding steady at twenty nights. And our average length of stay are still well ahead of where they were pre COVID level. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:24:21In fact, in the quarter, they picked up 3% year on year based on the paid media campaigns that our marketing funds were running and hit 1.95 nights, was significantly higher than they were pre COVID level. So on the transient side, our middle income guests are still more employed with wages and with savings higher than pre COVID. And nearly half of all Americans are still saying that they're planning a vacation for this summer, which is we don't have foresight to in terms of our booking windows. But the back part of your question, we're optimistic on the blue collar everyday travel fronts. We're seeing increasing private onshoring and public infrastructure demand, although it did start off slower than what we saw in the fourth quarter in terms of that 50 basis points. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:25:13And Michelle, I don't know if you want to add anything to that. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:25:17Sure. Happy to. Yes. As Jeff mentioned, Lizzie, leisure, I think the biggest disconnect from our initial guide and the results we saw back in January was leisure just not performing as strongly as we had expected. Pricing is holding. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:25:34Our weekday trends continue to outperform our weekend trends. It's really just that consumer sentiment resulting from the macro uncertainty that's weighing on the overall leisure occupancy in driving what I would say our outlook at this stage. And so if we think about the remainder of the year, we are in The U. S. Specifically, we're expecting at the low end that the rest of the year will perform consistent with the normalized trends we saw in March and April. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:26:12So that implies about 3% down. And then at the high end, obviously, we are building in some optimism to that just assuming that there could be potential that those trends were more of just a short term reaction to the uncertainty. And as the shock wears off, we would see the improvement that Jeff is talking about. And in addition to the positive momentum he referenced, would just add we're also seeing Google search volumes up over the last two weeks in April as it relates to hotel and travel related keywords, again giving us optimism that consumers are beginning to plan their summer vacations. Operator00:26:57And we'll take our next question from Michael Bellisario with Baird. Please go ahead. Your line is open. Michael BellisarioManaging Director at Baird00:27:05Thanks. Good morning, everyone. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:27:07Good morning, Mike. You had a new baby, I think, last quarter, right? Was it Annie? Michael BellisarioManaging Director at Baird00:27:13No. No. Number three is next quarter. I'm doing my part to catch up to you. Jeff, you didn't talk about your longer term outlook in Algo. Michael BellisarioManaging Director at Baird00:27:27I don't think have slides in your deck anymore. So maybe can you just sort of help us frame what that outlook would be in the current environment? Maybe what changes? And sort of what are the sensitivities that we should be thinking about there looking out to '26 today? Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:27:41Yes. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:27:42I'll talk just really quickly. An important part of that algo, Mike, is obviously our net room growth. And there is nothing that we're seeing that would prevent us from delivering. We've had a lot of questions on net room growth. On our long term 3% to 5% net room algo, we've had a record first quarter as we talked about 15,000 room openings, up 13%, really strong signings and really around the world with 180 hotel contracts awarded up 6% to last year and up 40% to the first quarter of twenty nineteen. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:28:15Our pipeline is in great shape, but Michelle could talk about the EBITDA. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:28:21Hi, Mike. So I think we'll have a better perspective on 2026 once we see how 2025 plays out after February. At the midpoint of this year's original outlook, we were pacing toward an 8.5% EBITDA CAGR over the three year period. I'd say with our revised outlook, EBITDA is down only about $13,000,000 this year, which as Jeff mentioned in no way alters our long term trajectory. Our growth algorithm remains intact. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:28:52Our focus is on controlling what we can control and everything within our control is performing at or above our expectations system growth, royalty rate, margin, CPAR, ancillary revenues, the pipeline all in line or better than expectations. So we'll continue to execute against our strategic priorities, manage our cost structure with discipline and of course deploy capital where it drives the greatest long term return. And history tells us then that U. S. Growth is typically around 2.6% annually. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:29:32And so while 2024 came in below trend and twenty twenty five May two, those under earning years should then be followed by stronger than average ones. So we feel really good about the fundamentals we can control. We're confident our business can compound growth at attractive rates in a more normalized RevPAR environment. Operator00:29:55We'll take our next question from Brent Montour with Barclays. Please go ahead. Your line is open. Brandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment Bank00:30:02Good morning, everybody. Thanks for taking my question. So I was I wanted to talk a little bit about the development backdrop. The net unit growth in the first quarter was just I mean, we calculated it's just a touch below the range for the year. And so that you guys are reaffirming that it implies a little bit of a lift as you go through the year. Brandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment Bank00:30:24Wondering if A, that's sort of plan what you guys expected to happen as you go through the year? And second, maybe Jeff if you could just talk about the your 70% your opens are conversions. Can you just talk about the puts and takes of the conversion business and that momentum as it pertains to the current backdrop I. E. Cost for furnished goods going up, but of course we've got this potential counter cyclicality effect of slowing RevPAR potentially helping. Brandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment Bank00:30:53Hope that all makes sense, but any thoughts there would be helpful. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:30:56There's a lot in there, Brent. And I'll start with where you started. I think we feel very good about the first quarter in terms of where we landed. As you know, our openings ramped throughout the year and it was very consistent. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:31:11There's a good slide Matt put in the deck in terms of what we needed to do this quarter and we felt we did it. And again, nothing out there that as I said to Mike is making us doubt our long term 3% to 5% algo. In terms of conversions, the second part of your question, we there's I think it's Slide six in the IP, which talks about our ability to flex up, but we were around 90% conversions during COVID, which as new constructions came down conversions came up. And you saw that normalize in our investor presentation, 70% of our full year 2024 openings, given the strength and the success of our new construction prototypes. And that has continued to pick up. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:31:57Our new construction openings picked up by 500 basis points both domestically and internationally to nearly a third of all of our openings. And with our executions, our new construction pipeline being up 400 basis points to 1,500 hotels in the first quarter, quarter on quarter, we're not seeing that slow down. So is there the ability to flex up in conversions? Absolutely. Domestically, our conversion pipeline was up double digits versus last year. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:32:28But we're feeling really, really good about it domestically. We're feeling great about it internationally. We met with dozens of developers this quarter in Southeast Asia, where our signings were strong, our conversion pipeline. We grew in Southeast Asia significantly in the quarter and in China, still real strong strength out there. You saw 90% more room openings in last quarter and a 17% domestic net room growth over there. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:32:56And then in Europe, we talked about that 40% increase in the pipeline, I believe in our script. We were over in India where gee whiz, I mean infrastructure demand is exploding and hotel supply just can't keep up. We were in India the first franchise company to enter India before franchising was even as popular as it is today. And we are today company with more franchise hotels than anyone else. And India is really what's helping fuel our EMEA growth in both the openings in the pipeline. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:33:31And then the last part of your question on what we're hearing in terms of costs, tariffs and whether or not that's going to slow things down. Tariffs, supply chain, stability on those fronts, certainly top of mind. But our teams are doing a great job of shifting sourcing, bringing production closer to home and negotiating with suppliers to share in the increased costs. There's always been a concern and you read a lot about the cost of steel and aluminum in the industry. But with us in our type of construction, we're a lot less about steel and aluminum, much more so focused on lumber, which is a huge driver of cost. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:34:16Most of our new construction is stick construction as opposed to steel and aluminum construction. And happily, the administration exempted Canadian lumber from the new tariffs, given I think what it knew its impact would be on new construction. And then the concern shifts to imported fixtures, furniture, equipment, technology, electronics. But we're optimistic and I think our franchisees are as well, Brent, that the uncertainty that's out there could be relatively short lived. I mean, we've worked through they've worked through supply chain disruption before and they are increasingly looking to us for help and our teams are increasingly sourcing domestically wherever possible. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:34:57In fact, we're mandating at least one domestic sourcing solution for all important supply categories. For example, our FF and E for our new Days Inn Dawn prototype, Days Inn is our best performing economy brand right now and its RPI just keeps going up and Days In Don prototype is a big part of that. It's being sourced entirely from North Carolina or Texas. Our Echo Suites, which we've talked a lot about, our fastest growing new construction brand launch yet, all of that FF manufactured in Minnesota, where we're not seeing any costs increase yet. So where sourcing is not domestic, we're certainly expanding solutions in other countries when it comes to things like technology like Vietnam and Cambodia. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:35:47And we're again optimistic that this is going to be more temporary than long term. I hope that answered it. Operator00:35:57We'll take our next question from David Katz with Jefferies. Please go ahead. Your line is open. David KatzManaging Director at Jefferies00:36:05Hi. Good morning, everybody. Thanks for taking my question. No babies here. None I was just going to leave it right there. David KatzManaging Director at Jefferies00:36:21Okay. I wanted to talk about okay. I wanted to talk about your development engine and sort of the development process, right? Easy to get sort of sucked into the near term RevPAR and demand etcetera, which is relevant. But taking a long term view on how you're one sort of allocating resources driving Nug, building a pipeline, I'd love some geographic updates on how you're doing in different areas. David KatzManaging Director at Jefferies00:36:54There's been a lot of concern about what might be going on in Asia or elsewhere with it. And if you could, Michel, just talk a little bit about sort of key money and key money strategies. It's another area that we're all quite interested in. Thank you. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:37:10Okay. I'll start off and pass it to Michelle on key money. She's very tough about those key money allocations and we're not doing much of it to the chagrin of our international presidents overseas nor do we have to. And I mean you mentioned Asia, that's a good place to start. We were over there this quarter and we've just seen continued acceleration on both the execution and the development front. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:37:34We are bringing in fee par accretive rooms. We opened 90% more rooms. Many of our peers have been talking about building master license relationships over there and how well they're working for them. We've been very focused having entered China, for example, twenty years ago with master license to focus more on selling the 20 plus brands that are not master license directly, because they're coming in at much higher fee parts, much higher license fees. And so while we opened 90% more rooms, the team executed so many more deals, over 50 deals, more deals executed than they did last year. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:38:18And our Asia Pacific pipelines, whether it's in countries like Thailand or Singapore, we are seeing robust growth and we're seeing really strong growth on both the new construction side and on the conversion side. We have continually invested in our franchise sales and development teams overseas. Europe is a big, big area right now that we're focused on that's doing very well from both an application standpoint and an opening standpoint as is Latin America. So we continue to increase our sellers, our franchise sales team. We're focused entirely right now on selling direct franchise agreements as opposed to master license agreements overseas and we're using very little key money to do that. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:39:19Michelle? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:39:21Sure. From a key money strategy, we are prioritizing opportunities David as you know that deliver high quality revenue accretive fee par to the system. That means we're focusing on higher RevPAR markets where we can or already do have scale and where we can drive pricing. I'd say internationally we're being selective and strategic about how we direct the capital even how we direct our human capital. And you'll see us do a good bit of volume in EMEA this year, specifically in Germany. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:40:04We really like the structure of that market being the largest economy in Europe. But as Jeff mentioned, we're not deploying capital into China for example. So being very selective and very strategic. We know this strategy is working. It's worked really well for us over the last few years and we continue to add more attractive markets into the system. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:40:32Just this quarter we added Singapore for instance internationally. And the deals that have development advances associated with them are coming in at much higher fee pars. So we're really thrilled to be seeing this strategy executing according to our expectations and the teams are really happy to have this tool in their toolkit. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:40:55And very happy to see without a lot of key money as Michelle mentioned going out internationally that international pipeline coming in with a fee par premium of over 30%. I think it's 32% of what is in our existing international system. Operator00:41:13And we'll take our next question from Stephen Grambling with Morgan Stanley. Please go ahead. Your line is open. Stephen GramblingManaging Director at Morgan Stanley00:41:21Thanks. And this is just a follow-up on that question. I guess sometimes when what we see now is the output of several years of efforts as we think about what might happen going forward and the major changes you see in the development environment. Maybe if you can just elaborate on how either the terms of the structure of agreements maybe have changed over the past few years of higher interest rates? And then just to clarify, I think the loan advances you cited there were up a little bit. Stephen GramblingManaging Director at Morgan Stanley00:41:52Is that and that's just is that related to moving upstream? Or is that new markets? And then what's the typical, I guess, payback that we should think about on those? Thank you. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:42:03Yes, sure. With respect to the loan advances, we had an opportunity to advance our partnership with one of the premier developers in Germany. I just mentioned that was a strategic and is a strategic market for us. We're able to strengthen our footprint in this very important region, Germany's largest economy, highest BPAR market of North America and we've been really focused on building density there. This portfolio will add over 3,000 rooms to our system over the next few quarters as we integrate it. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:42:40And you can see that impact in the EMEA pipeline, is up 40% for the region. Stephen GramblingManaging Director at Morgan Stanley00:42:51Got it. And I guess are those kind of standard terms or do we see that get paid back over a typical length of time or do we assume Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:43:00Oh, Yes. It's definitely an interest bearing loan and it will be paid back over I believe the next two years. Operator00:43:13And we'll take our next question from Dani Assad with Bank of America. Please go ahead. Your line is open. Dany AsadDirector at Bank of America00:43:21Hi. Good morning, everybody. Just a follow-up question on your change in outlook comments, Michel. You talked about the low end run rating at down 3%, the top end of the guide being up 1% for the balance of the year. Can you maybe break that down for us by what's changing in your outlook by region? Dany AsadDirector at Bank of America00:43:40So what's changing in The U. S? And then how is your outlook in the rest of the world changing? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:43:46Sure. Yeah. Actually my prior comments were with respect to The U. S. Only because I think that was the exact question. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:43:54So let me just clarify. In The U. S, we're assuming that we see the continued pressure from March and April for the remainder of the year. So that would have us down 3% on a normalized basis. Of course, it's going to be down a little bit more in the fourth quarter when you take into account lapping the hurricane headwinds, but it will all average out to down 3% for the remaining the remainder of the year. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:44:23Internationally, I'd say we've taken a generally consistent approach using the more recent trends in each of the regions to project out the rest of the year. Every region as you know faces its own dynamics. China has faced more recent pricing pressure. EMEA momentum has continued. LATAM is seeing exceptional ADR growth. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:44:45In Canada, we're assuming again consistent March and April performance, which was not really stellar. So overall, we're expecting international RevPAR to decline about one point on a constant currency basis. Operator00:45:04And we'll take our next question from Steve Pizzella with Deutsche Bank. Please go ahead. Your line is open. Steve PizzellaAnalyst at Deutsche Bank00:45:12Hey, good morning, everyone. I just wanted to follow-up on the encouraging recent trends comment again. Maybe you could expand on where you are seeing that and if you think they are sustainable? And if these recent trends were continue, would that get you to the midpoint of the EBITDA guidance? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:45:31So, I'd say our guidance is meant to reflect any range of outcomes. At the low end, we are assuming pretty generally speaking that the trends we saw in March and April continue for the remainder of the year. Again, there is potential as Jeff mentioned that those trends were more transitory and that we would see improvement from that and we're starting to see some early signs of positive momentum. But to be fair, starting to see some early signs of positive momentum and the majority of our EBITDA is going to come in those very important summer months. So until we have full visibility of what that looks like, it's really we really just need to see how those are going to perform. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:46:23What's going to get us to the midpoint or the higher end is improved performance from those March and April trends obviously. We would expect to be closer to the midpoint, I'd say, than the lower end if we see improvement from that down 3% in The U. S. Operator00:46:45And we'll take our next question from Patrick Scholes with Truist. Please go ahead. Your line is open. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:46:52Great. Thank you. Good morning, everyone. No plans for any more children in my family. We are good there in that department. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:47:04Thank you. Patrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist Securities00:47:07Question here on the ancillary revenues. I believe last quarter you had called out an expectation for low teen growth for this year. Certainly since last quarter, I believe it was in February, we've seen declining consumer confidence. Is your expectation still the same for low teen ancillary revenue growth? Patrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist Securities00:47:38Thank you. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:47:39Hi, Patrick. Sure. Yes, we continue to expect 2025 growth to be in the low teens range and there are further growth opportunities beyond 2025 including international expansion. And so we continue to expect it will be higher than low teens in 2026. As it relates to this year and this current RevPAR environment, I'd say a significant portion of our ancillary revenue is contract based, which provides a high level of visibility and durability. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:48:10And then the largest growth driver this year as you know is expected to be our co branded credit card. And the non contractual piece of our card income is based on total card spend not just travel spend and only about a third comes from the travel category. So I think that makes us fee stream more insulated from RevPAR fluctuations and we feel really comfortable at this stage and where we're guiding right now from a RevPAR outlook that the ancillary fees will continue to grow in that low teens range for 25%. Patrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist Securities00:48:47Okay. Could you just give a little bit of explanation exactly what a contracted it sounds like that's something that's locked in no matter what happens here. What exactly is that? Thank you. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:48:59Sure. With respect to license fees, for example, there is a minimum floor that P and L will pay to Wyndham. So their VOI at P and L would need to drop pretty materially before we would eat into that floor. So it provides kind of a base space. Operator00:49:26And we'll take our next question from Ian Zaffino with Oppenheimer. Please go ahead. Your line is open. Ian ZaffinoManaging Director at Oppenheimer & Co. Inc.00:49:34Hi, great. Thank you. Maybe talk about like the trends you're seeing in infrastructure right now. Have you really seen any impact from macro? Do you expect to see any softening there? Ian ZaffinoManaging Director at Oppenheimer & Co. Inc.00:49:47Or is it kind of just steady as she goes? Thanks. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:49:52Thanks. Ian, we did as I mentioned in Lizzie's question see a bit of a slowdown in the first quarter versus the fourth quarter with the halting of disbursements of infrastructure funds in January. But the IIJA allocations are gradually resuming. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:50:13Several of us, several hotel and airline CEOs had the opportunity to meet a few weeks ago with Transportation Secretary Sean Duffy down in D. C. And the assurance that the administration's main focus is all about getting the balance of the allocations out, but more importantly as Secretary Duffy actually spent. The administration wants faster spending on highway and bridge construction, big beautiful highways, big beautiful bridges. There is just too much economic growth. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:50:49There's too much job creation. There's too much economic stimulus to boost GDP for this, as Secretary Duffy put it to us, not to happen in terms of making the transportation infrastructure stronger. And we certainly heard that for anybody that was listening yesterday to the televised cabinet meeting in the White House, all about getting those funds flowing when it comes to things like our nation's airports and air traffic control or the recent Energy Dominance executive order to expand oil and gas exploration that Secretary Wright talked about yesterday. And we're starting to see that. Our GSO revenue growth continued to pick up. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:51:34It was up smaller numbers, but it was up 30% year on year. And so much of that is driven by infrastructure and by our remote sales teams that franchisees can opt into for sales support actually availing themselves of the demand that those contracts are creating. Our consumed GSO revenue in the first quarter from infrastructure room nights exceeded The U. S. STR industry growth by about three eighty basis points. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:52:05So that's helping us drive continued mid scale mid week share gain. And we're also seeing strong private investment with dozens of hotels near our nation's largest data centers. Secretary Lutnick, they were all talking about it yesterday was referencing what's going on out in Arizona with TSMC and the investment that they're making. We have dozens of hotels that are seeing the benefits of that demand. So we continue to view the infrastructure spend that $1,200,000,000,000 bill as a multiyear tailwind that's going to be driving over $3,000,000,000 of gross room revenue to our hotels in the next eight to ten years. Operator00:53:09We'll take our next question from Alex Bregnant with Redburn Atlantic. Please go ahead. Your line is open. Alex BrignallManaging Director - Research Analyst at Redburn Atlantic00:53:18Good morning. Thank you for taking the question. On the German deal, could you just give us some more detail on the terms of that on the nature of the 3,000 rooms if they're already existing on new construction? And whether there are any similar deals that you have in the pipe that could come through later down the line? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:53:48Sure. I probably can't disclose specific terms for competitive reasons. I can say that it is a structure that allowed us to provide financing to a partner that was well above our cost of capital and with strong structural provisions and personal guarantees. We're always judicious with our capital and make sure when we deploy it, it's above our hurdle rates. Our first priority is investing in the business and in high quality growth. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:54:34And I'd say an asset light cash generative business like ours gives us flexibility even in uncertain times to evaluate opportunities on a case by case basis and deploy capital where it creates the most long term value. Could there be potential opportunities like this in the future? We hope so. Bringing in 3,000 high quality CPAR accretive rooms in one of our key strategic markets is something we're incredibly excited about. And so I think when we think about deals and what makes most sense for the long term health of our business, we have a number of tools in the toolkit and we deploy them very strategically. Operator00:55:29And we will take our last question today from Dmitry Waselek with Morningstar. Please go ahead. Your line is open. Dan WasiolekAnalyst at Morningstar00:55:38Hey, good morning guys. Yeah, just wondering your commercial team seems to be leading the industry in innovative technology solutions. What opportunities are you providing owners in this environment to lower costs and increase top line growth? Thank you. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:55:51Well, thank you for that shout out Dan. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:55:53I'm sure Scott Strickland and incredible commercial team appreciate it. They've been very busy. Over the last six years, we've talked a lot about it's in our investor deck. We've invested over $300,000,000 in what has become an industry leading tech stack. We have completely moved off of legacy providers. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:56:11We have best in class providers that are entirely cloud based like Oracle and Amazon and Adobe. Canary is our most recent and exciting partner. And all of these partners along with Sabre of course, which is all of where all of our ARI is held, it's enabling us to innovate faster. It's taking labor intensive tasks away from our franchisees and it's really raising the service bar for our customers. Most importantly for our small business owners, we'll be talking a lot about this at our global conference, it's allowing them to make extra money. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:56:47But our approach with our franchisees and small business owners is not to mandate these services, these programs, this technology, but to offer them on an opt in basis. And when we have 5,000 of our 6,000 U. S. Franchisees opting into services like our signature reservation service, where they don't have to employ a front desk agent to check Dan Woziolik in, but they're able to actually service them while all of those calls are bounced to a professionally run call center that's delivering a much faster average speed of answer, a much higher conversion rate and a significantly higher up to 15% higher ADR lift. That's a big deal. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:57:33And they'll sign up for that all day long as they will our opt in revenue management services, which drive hundreds of increased basis points of occupancy or I mentioned earlier our sales support where we're hiring salespeople across the country because small business owners can't necessarily afford them on their team, but are willing to opt into those type of services. We're also offering free services that any small business owner would be crazy not to opt into like our ability to reconcile OTA reservations that don't show up at no cost delivering thousands of dollars of savings a month. I could go on and on. We've talked a lot about Wyndham Connect. It will be a big push for us at conference. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:58:20Over three quarters of our franchisees have opted into because it is a best in class suite of technology that's allowing monetization efforts for franchisees to now charge effortlessly, seamlessly for an early check-in for the Wagiolix family or a late checkout or what they might want in their room before they arrive. So we're really excited about it. It's a big piece of our value proposition and something that our franchise sales teams are very proud of offering to our franchisees. Operator00:59:00And there are no further questions on the line at this time. I'll turn the floor back to Jeff Bellotti for any closing remarks. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:59:07Thank you very much, David, and thanks everyone for joining us and for your questions today and your continued interest in Wyndham Hotels and Resorts. Michelle, Matt and I look forward to seeing many of you at the upcoming investor conferences that we'll be at in the weeks ahead and to spending time with thousands of our franchisees, our team members from around the world and our strategic sourcing partners at our twenty twenty five Wyndham Global Hotel Conference in Las Vegas at Caesars Forum from May 19 to the 21 this month. Have a great day everyone. Operator00:59:41Thank you. And this does conclude today's Wyndham Hotels and Resorts first quarter twenty twenty five earnings conference call. Please disconnect your line at this time and have a wonderfulRead moreParticipantsExecutivesMatt CapuzziSVP IRGeoff BallottiPresident, CEO & DirectorMichele AllenCFO & Head of StrategyAnalystsLizzie DoveVice President Equity Research at Goldman SachsMichael BellisarioManaging Director at BairdBrandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment BankDavid KatzManaging Director at JefferiesStephen GramblingManaging Director at Morgan StanleyDany AsadDirector at Bank of AmericaSteve PizzellaAnalyst at Deutsche BankPatrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist SecuritiesIan ZaffinoManaging Director at Oppenheimer & Co. Inc.Alex BrignallManaging Director - Research Analyst at Redburn AtlanticDan WasiolekAnalyst at MorningstarPowered by Conference Call Audio Live Call not available Earnings Conference CallWyndham Hotels & Resorts Q1 202500:00 / 00:00Speed:1x1.25x1.5x2xTranscript SectionsPresentationParticipants Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Wyndham Hotels & Resorts Earnings HeadlinesCalling All Golf Fans: Score Behind-the-Scenes Access and $10,000 with New Wyndham Championship GigMay 6 at 12:04 PM | gurufocus.comGearing Up for Game Time: Days Inns - Canada Teams Up with XMC and The Canadian Hockey League for Fan-Focused Activation at the 2025 Memorial CupMay 6 at 8:00 AM | globenewswire.comMar-a-Lago Neighbor's Warning: "We're Witnessing an Extinction Event in Real-Time"A Wall Street legend who managed $7 BILLION in assets has released a controversial video from his Palm Beach estate. He warns of an economic event unlike anything in history, creating both unprecedented wealth and devastating losses.May 6, 2025 | InvestorPlace (Ad)Wyndham Hotels & Resorts, Inc. (NYSE:WH) Receives $111.33 Average Target Price from AnalystsMay 4 at 1:27 AM | americanbankingnews.comStifel Nicolaus Has Lowered Expectations for Wyndham Hotels & Resorts (NYSE:WH) Stock PriceMay 3 at 2:53 AM | americanbankingnews.comWyndham Hotels & Resorts, Inc. (WH) Q1 2025 Earnings Call TranscriptMay 2, 2025 | seekingalpha.comSee More Wyndham Hotels & Resorts Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Wyndham Hotels & Resorts? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Wyndham Hotels & Resorts and other key companies, straight to your email. Email Address About Wyndham Hotels & ResortsWyndham Hotels & Resorts (NYSE:WH) engages in the franchise and operation of hotels under the Wyndham brand. It operates through the Hotel Franchising and Hotel Management segments. The Hotel Franchising segment focuses on licensing the company’s lodging brands and providing related services to third-party hotel owners and others. The Hotel Management segment provides management services. The company was founded in 1990 and is headquartered in Parsippany, NJ.View Wyndham Hotels & Resorts ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Palantir Stock Drops Despite Stellar Earnings: What's Next?Is Eli Lilly a Buy After Weak Earnings and CVS-Novo Partnership?Is Reddit Stock a Buy, Sell, or Hold After Earnings Release?Warning or Opportunity After Super Micro Computer's EarningsAmazon Earnings: 2 Reasons to Love It, 1 Reason to Be CautiousRocket Lab Braces for Q1 Earnings Amid Soaring ExpectationsMeta Takes A Bow With Q1 Earnings - Watch For Tariff Impact in Q2 Upcoming Earnings ARM (5/7/2025)AppLovin (5/7/2025)Fortinet (5/7/2025)MercadoLibre (5/7/2025)Cencora (5/7/2025)Carvana (5/7/2025)Walt Disney (5/7/2025)Emerson Electric (5/7/2025)Johnson Controls International (5/7/2025)Lloyds Banking Group (5/7/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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PresentationSkip to Participants Operator00:00:00Welcome everyone to the Wyndham Hotels and Resorts First Quarter twenty twenty five Earnings Conference Call. At this time, all participants have been placed in a listen only mode and the floor will be open for your questions following the presentation. I would now like to turn the call over to Matt Cappuzzi, Senior Vice President of Investor Relations. Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:00:40Thank you, operator. Good morning and thank you for joining us. With me today are Jeff Pilate, our CEO and Michelle Allen, our CFO and Head of Strategy. Before we get started, I want to remind you that our remarks today will contain forward looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:01:02These risk factors are discussed in detail in our most recent annual report on Form 10 ks filed with the Securities and Exchange Commission and any subsequent reports filed with the SEC. We'll also be referring to a number of non GAAP measures. Corresponding GAAP measures and a reconciliation of non GAAP measures to GAAP metrics are provided in our earnings release and investor presentation, Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:01:28which Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:01:28are available on our Investor Relations website at investor.wyndhamhotels.com. We are providing certain measures discussing future impact on a non GAAP basis only because without unreasonable efforts, we are unable to provide the comparable GAAP metric. In addition, last evening, we posted an investor presentation containing supplemental information on our Investor Relations website. We may continue to provide supplemental information on our website and on our social media channels in the future. Accordingly, we encourage investors to monitor our website and our social media channels in addition to our press releases, filings submitted with the SEC and any public conference calls or webcasts. Matt CapuzziSVP IR at Wyndham Hotels & Resorts00:02:15With that, I will turn the call over to Jeff. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:02:18Thanks, Matt. Good morning, everyone, and thanks for joining us today. Despite an uncertain macro environment, we delivered a very solid start to the year. Adjusted EBITDA grew 9% on a comparable basis and adjusted EPS increased 20%. We grew our global system by 4% and our pipeline by 5% to a record 2,143 hotels. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:02:44We saw healthy increases in both our U. S. And our international royalty rates. We drove continued growth in our ancillary fee streams and we returned nearly $110,000,000 to our shareholders. Global RevPAR grew 2% in constant currency. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:03:03International RevPAR grew in all regions except China. Latin America RevPAR grew by 25% excluding Argentina's hyperinflation with both strong ADR and higher fee par additions in Mexico and in The Caribbean. EMEA RevPAR rose 6% with solid performance in Germany, Turkey, India and Greece. And Southeast Asia and The Pacific Rim posted year over year RevPAR growth of 8%. And in China, demand remained steady, but RevPAR declined 8% year over year reflecting continued pricing pressure. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:03:40As you've all been tracking through STR, while U. S. RevPAR started strong in January, momentum softened in February and March as consumer sentiment weakened. Our results finished about three points below our expectations, growing 2% for the quarter or up 60 basis points when normalizing for the benefit from hurricanes and the Easter shift to Q2. Excluding these benefits, pricing power still remains steady, increasing 110 basis points for the quarter against a 50 basis point decline in demand. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:04:17When normalizing for the timing of Easter and the lapping of last year's solar eclipse, April month to date RevPAR in The U. S. Is down 3% consistent with what we saw in March on a normalized basis. And while March and April results have trended below the expectations we had assumed in our original outlook and Michelle will take you through our revised outlook in a moment. Recent trends are now more encouraging indicating positive momentum as we head into the busy summer travel months. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:04:47Whatever demand scenario may transpire, our brands have always outperformed in periods of economic downturn relative to the overall industry. Following nineeleven, RevPAR for our select service hotels outperformed STR's upscale and above segments by 300 basis points during the global financial crisis by 500 basis points and during COVID by 2,500 basis points. Wyndham's track record of industry outperformance is not coincidental. It reflects the structural advantages of our select service model and the nature of the demand that we serve. With limited reliance on white collar corporate and group travel, which tends to contract most during economic downturns, our business is anchored by a stable and resilient base of essential frontline blue collar workers, a guest segment that continues to drive consistent demand even as broader corporate discretionary travel budgets tighten. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:05:51This segment has shown resilience through prior cycles and we expect it to do the same in any macroeconomic setup. Moreover, we are far less impacted by the current international inbound demand declines. Less than 3% of our bookings in The United States arrive from international inbounds, including less than 2% from Canada. Approximately 90% of our footprint is concentrated in drive to markets where leisure demand is less impacted by the cost and the complexity of air travel. Our brands are attractively priced relative to upscale full service hotels, positioning Wyndham to capture trade down demand from both leisure and business travelers seeking value. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:06:35We outperform in times of economic distress because our model is different. During economic down cycles, we've continued to grow our system. Amid softer demand environments, hotel owners consistently turn to brands at scale that they know and that they trust and brands that outperform their competitors seeking broad distribution, a loyal customer base, operational support and cost efficiencies. As independent and underperforming branded hotels face mounting pressure, Wyndham offers the tools and the support needed to compete more effectively. And as investment in U. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:07:14S. Manufacturing accelerates, particularly in secondary markets, our existing system and pipeline of select service and extended stay hotels are located in regions where demand is growing. Whether it's in markets driven by the onshoring that new tariffs are creating, whether it's in markets that are beginning benefit from large infrastructure projects that are finally beginning to break ground from the federal infrastructure bill where allocations are ramping or whether it's from new private sector investments in large data center projects across the country, Wyndham's portfolio is well positioned to serve the everyday travel that these markets will benefit from in the decade ahead. Our continued momentum on the development front speaks volumes, reflecting not only the strength of our value proposition to owners, but also the confidence that they have in our ability to perform in any range of market conditions. This was a record first quarter for us in terms of room additions. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:08:20We opened 15,000 rooms, 13% more than we did last year and our development teams drove sequential net room growth across every region we operate in. We signed 6% more deals than a year ago, expanding our pipeline for the nineteenth consecutive quarter to a new all time high of 254,000 rooms, representing an average fee par premium of over 30% versus our current domestic and international systems. Domestically, our midscale and above brands grew 4% driven by conversions like the Wyndham Avanti Resort and Conference Center on International Drive in Orlando and new construction openings like the La Quinta Hotel in La Habra in Orange County, California. New Echo Suites and Hawthorne Suites openings continued across Texas, Virginia and Wyoming, reflecting growing developer interest in our extended stay new construction prototypes. Prototypes. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:09:25Internationally, we grew net rooms by 7%. With continued strong interest in our brands across Europe, The Middle East and Eurasia, our team grew the pipeline by nearly 40% and net rooms for the quarter by 5% with new construction additions like the La Quinta Batumi Beach in Georgia's coastal hotspot. Latin America grew its pipeline by 9% and increased net rooms by 10% with high quality conversions like the Wyndham All Trip Punta Cana Resort and new construction hotels like the new Trip by Wyndham Guzman located in the heart of Jalisco, the Mexican birthplace of tequila. In Southeast Asia in the Pacific room, net rooms grew by 14% including the debut of our Wyndham Grand brand in Phnom Penh, Cambodia. And in China, our team doubled our direct franchising system openings and grew net direct franchise rooms by 17% with both spectacular new conversions and beautiful new construction additions like the Days Inn by Wyndham Shantou Jingping, our one hundredth Days Inn in China. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:10:41By contrast, our legacy master license franchisees in China grew at a much slower pace, up less than 2% year over year. Excluding our China master license fees, Global System growth would have been 30 basis points higher than our headline growth rate, underscoring our strategic focus on accelerating growth within our direct franchising platform internationally, where we continue to see stronger FPAR and greater revenue potential in the quarters and the years ahead. As we prioritize our development growth in higher FPAR geographies and higher chain scales, as we build scale in markets where we already have significant density, and as we expand our direct franchising in select regions previously heavily reliant on master licensee relationships, the hotels we're adding are entering the system with a stronger economics, contributing to meaningful royalty rate accretion, which is beginning to pay off. This quarter for example, our royalty rate increased by 19 basis points domestically and by 15 basis points internationally. By continuing to remix our portfolio towards higher fee par hotels, we're elevating the long term earnings power of our system. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:12:03We also continued to see strong momentum in our ancillary fee growth this quarter, driven by our renewed co branded credit card agreement, our growing partnership initiatives and our ongoing technology innovations. New Barclays accounts rose 11% and spend volumes increased 7%. Our new debit card, which was launched this quarter, is attracting a much younger demographic into our ecosystem. And we recently announced a new partnership adding Carnival Cruise Lines to Wyndham Rewards, giving our loyalty members even more ways to explore, to earn and to make the very most out of their vacations. Finally, we want to recognize our phenomenal team members around the world. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:12:50For the third straight year and the fifth time overall, Wyndham was named one of the world's most ethical companies by Ethisphere. This honor reflects the care, the commitment and the integrity that our teams bring to their work every day and it's what makes Wyndham such a great place to work and a great company to partner with. In closing, while the current demand environment is uncertain, our focus remains firmly on the long term. We've been here before. And each time, we've stayed grounded in what we do best, growing our system, supporting our franchisees and advancing the strategic initiatives that strengthen our business over time, which is exactly what we're focused on doing right now. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:13:37Our value proposition is stronger than ever. It's powered by our world class teams, a best in class technology stack, the industry's number one loyalty program and a resilient asset light business model designed to perform through all phases of any economic cycle. We remain confident that our growth strategy will continue to deliver meaningful value for all of our stakeholders. And with that, I'll now turn the call over to Michelle. Michelle? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:14:08Thanks, Jeff, and good morning, everyone. I'll begin my remarks today with a detailed review of our first quarter results. I'll then review our cash flows and balance sheet followed by our outlook. Before we begin, let me remind everyone that the comparability of our quarterly results is impacted by the timing of our marketing fund spend. In the first quarter of this year, fund expenses exceeded revenues by $22,000,000 compared to expenses exceeding revenues by $14,000,000 in the first quarter of last year. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:14:39To enhance transparency and provide a better understanding of the results of our ongoing operations, I will be highlighting our results on a comparable basis, which neutralizes In the first quarter, we generated $316,000,000 of fee related and other revenues and $145,000,000 of adjusted EBITDA. Fee related and other revenues increased $12,000,000 year over year, principally reflecting a 9% increase in royalties and franchise fees as well as higher ancillary revenues. The increase in royalties and franchise fees reflects system sales of 4%, royalty rate improvement of 16 basis points and higher other franchise fees. Our ancillary revenue growth was primarily driven by higher credit card and partnership fees as well as increased license fees. Adjusted EBITDA grew 9% on a comparable basis, primarily reflecting the higher fee related and other revenue and approximately 60 basis points of margin improvement. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:15:43First quarter adjusted diluted EPS was $0.86 up 20% on a comparable basis due to EBITDA growth, the benefit of share repurchases and lower depreciation and amortization, partially offset by higher interest expense. First quarter free cash flow was $80,000,000 converting from adjusted EBITDA at approximately 55% in line with our expectations. We returned $109,000,000 to our shareholders in the first quarter through $76,000,000 of share repurchases and $33,000,000 of common stock dividends. Amid broader market volatility and a meaningful share price decline during the quarter, we accelerated buybacks repurchasing 35% more than we did in the first quarter of twenty twenty four. We closed the quarter with approximately $640,000,000 in total liquidity and our net leverage ratio of 3.5 times remained as expected at the midpoint of our target range. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:16:49Turning now to outlook. While first quarter global RevPAR performed in line with our full year expectations, as Jeff mentioned, we had anticipated stronger performance, especially in March, given the relative ease of the year over year comparison. With trends remaining softer through April, we are refining our 2025 outlook to reflect a more cautious view of industry wide RevPAR performance for the remainder of the year. Our current assumption is that full year constant currency global RevPAR will range between down 2% to up 1%. The high end of this range assumes the remaining nine months of the year perform largely in line with our original outlook, essentially implying a swift resolution to the current global trade tensions and a corresponding improvement in consumer sentiment. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:17:44While that may prove optimistic, we believe it provides a useful reference point for modeling purposes. Conversely, the lower end of the range reflects RevPAR performance more consistent with the trends we saw in March and April where the rest of the year declined about 3%. Given the current uncertainty and limited long term visibility, we believe this new guidance is a reasonable lower bound for planning purposes, wider than what we typically provide, but a prudent response in today's volatile macro environment. To help frame the potential variability, we've provided RevPAR sensitivities on slide 21 of our investor presentation. Every one point change in RevPAR equates to an approximate $10,000,000 impact to fee related and other revenues and $4,000,000 impact to adjusted EBITDA. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:18:37There are no changes to our net room growth outlook. Fee related and other revenues is now expected to be $1,450,000,000 to $1,490,000,000 down from our prior outlook of $1,490,000,000 to $1,510,000,000 This decline is roughly split evenly between royalties and franchise fees and marketing reservation and loyalty revenues. As we navigate this environment, we're taking prudent action to manage expenses carefully, which is allowing us to meaningfully offset much of the revenue impact at the EBITDA line. Adjusted EBITDA is now expected to be between $730,000,000 and $745,000,000 down 10,000,000 to $15,000,000 from our prior outlook. Adjusted net income is projected to be $358,000,000 to $372,000,000 and adjusted diluted EPS is projected at $4.57 to $4.74 which reflects the first quarter share repurchases and is based on a diluted share count of 78,400,000.0. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:19:44As usual, our EPS outlook assumes no share repurchase activity or incremental interest expense associated with any potential borrowing activity. Free cash flow conversion before development of Fantas is expected to be approximately 57%. There is no change to our development advance spend outlook. As it relates to our marketing funds, our expectation remains that at the RevPAR levels we're now guiding to, the funds will breakeven on a full year basis give or take a few million dollars. We also expect the marketing funds will breakeven in the second quarter. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:20:20Our business model is built for resilience. We no longer own hotels. We no longer carry management or performance based operating guarantees and nearly 100% of our system is franchise, making Wyndham the most asset light business in the industry. Our strong balance sheet enables us to stay focused on our long term growth strategy, disciplined capital allocation and the flexibility to lean in when opportunities arise. Together these strengths position us to unlock long term value and deliver meaningful returns for our shareholders regardless of near term dynamics. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:20:55With that, Jeff and I would be happy to take your questions. Operator? Operator00:21:25We'll take our first question today from Lizzie Dove with Goldman Sachs. Please go ahead. Your line is open. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:33Hi, there. Thanks for taking the question. First off, Jeff, just wanted to say a big congratulations on the new addition to your family last week. It's exciting news. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:21:42Thanks very much, Lizzie. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:44Yes. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:21:44It's exciting. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:45Course. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:21:45Four daughters and now three grandsons in two short years. It's amazing how fast that happens. Lizzie DoveVice President Equity Research at Goldman Sachs00:21:52That's awesome. That's awesome. So on the question, I appreciate all the comments around the range of outcomes for RevPAR outlook, super helpful. I guess looking at The U. S. Lizzie DoveVice President Equity Research at Goldman Sachs00:22:01Specifically, could you share a little more about what you've been seeing and just put a finer point on what has changed? I think last quarter the makeup of the outlook of 2% to 3% in The U. S. Was about 150 basis to 200 basis points infrastructure, then another 50 basis on leisure, 50 basis on pricing power. So when you think of that makeup now, I'm just curious how that buildup is different today? Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:22:22Sure. It's probably a little bit different on the infrastructure side and we could talk about that in a second. But to your first part of your question in terms of what we're seeing, I'd say we're all still optimistic on the team Lizzie. Normalized April demand was performing as Michelle said, similarly to March. But that was until last week where we saw RevPAR improved by 400 basis points, running about a full point ahead of prior year. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:22:50So the pace for May, '20 days out with a third of our business on the books is trending in line with our revised outlook with pricing holding firm. I think that's really important. Our franchisees realize that there is still pricing power out there that their ADRs are still well below inflation and well a good room for ADRs to run. And I've got to give a shout out to our teams who are working so hard to communicate with our franchisees our revenue management best practices to really drive rate and margin. We have a global conference coming up in a couple of weeks and that will be what we're talking about, ensuring that franchisees are building that base business with contracted negotiated business, really taking advantage of all of our on demand and digital marketing to drive occupancy. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:23:42So pricing holding firm, majority of our franchisee revenue, you know, I think it was your question to Michelle on last month's call, is there seasonality? There is. A third of our hotels full year demand shows up in June, July and August. And so we're exiting April with momentum. And we're encouraged that leisure transient will pick up into the summer months. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:24:06And there are lots of other reasons for that optimism. Our cancellation rates are holding steady. They're not ticking down. Our average lead times are holding steady at twenty nights. And our average length of stay are still well ahead of where they were pre COVID level. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:24:21In fact, in the quarter, they picked up 3% year on year based on the paid media campaigns that our marketing funds were running and hit 1.95 nights, was significantly higher than they were pre COVID level. So on the transient side, our middle income guests are still more employed with wages and with savings higher than pre COVID. And nearly half of all Americans are still saying that they're planning a vacation for this summer, which is we don't have foresight to in terms of our booking windows. But the back part of your question, we're optimistic on the blue collar everyday travel fronts. We're seeing increasing private onshoring and public infrastructure demand, although it did start off slower than what we saw in the fourth quarter in terms of that 50 basis points. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:25:13And Michelle, I don't know if you want to add anything to that. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:25:17Sure. Happy to. Yes. As Jeff mentioned, Lizzie, leisure, I think the biggest disconnect from our initial guide and the results we saw back in January was leisure just not performing as strongly as we had expected. Pricing is holding. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:25:34Our weekday trends continue to outperform our weekend trends. It's really just that consumer sentiment resulting from the macro uncertainty that's weighing on the overall leisure occupancy in driving what I would say our outlook at this stage. And so if we think about the remainder of the year, we are in The U. S. Specifically, we're expecting at the low end that the rest of the year will perform consistent with the normalized trends we saw in March and April. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:26:12So that implies about 3% down. And then at the high end, obviously, we are building in some optimism to that just assuming that there could be potential that those trends were more of just a short term reaction to the uncertainty. And as the shock wears off, we would see the improvement that Jeff is talking about. And in addition to the positive momentum he referenced, would just add we're also seeing Google search volumes up over the last two weeks in April as it relates to hotel and travel related keywords, again giving us optimism that consumers are beginning to plan their summer vacations. Operator00:26:57And we'll take our next question from Michael Bellisario with Baird. Please go ahead. Your line is open. Michael BellisarioManaging Director at Baird00:27:05Thanks. Good morning, everyone. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:27:07Good morning, Mike. You had a new baby, I think, last quarter, right? Was it Annie? Michael BellisarioManaging Director at Baird00:27:13No. No. Number three is next quarter. I'm doing my part to catch up to you. Jeff, you didn't talk about your longer term outlook in Algo. Michael BellisarioManaging Director at Baird00:27:27I don't think have slides in your deck anymore. So maybe can you just sort of help us frame what that outlook would be in the current environment? Maybe what changes? And sort of what are the sensitivities that we should be thinking about there looking out to '26 today? Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:27:41Yes. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:27:42I'll talk just really quickly. An important part of that algo, Mike, is obviously our net room growth. And there is nothing that we're seeing that would prevent us from delivering. We've had a lot of questions on net room growth. On our long term 3% to 5% net room algo, we've had a record first quarter as we talked about 15,000 room openings, up 13%, really strong signings and really around the world with 180 hotel contracts awarded up 6% to last year and up 40% to the first quarter of twenty nineteen. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:28:15Our pipeline is in great shape, but Michelle could talk about the EBITDA. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:28:21Hi, Mike. So I think we'll have a better perspective on 2026 once we see how 2025 plays out after February. At the midpoint of this year's original outlook, we were pacing toward an 8.5% EBITDA CAGR over the three year period. I'd say with our revised outlook, EBITDA is down only about $13,000,000 this year, which as Jeff mentioned in no way alters our long term trajectory. Our growth algorithm remains intact. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:28:52Our focus is on controlling what we can control and everything within our control is performing at or above our expectations system growth, royalty rate, margin, CPAR, ancillary revenues, the pipeline all in line or better than expectations. So we'll continue to execute against our strategic priorities, manage our cost structure with discipline and of course deploy capital where it drives the greatest long term return. And history tells us then that U. S. Growth is typically around 2.6% annually. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:29:32And so while 2024 came in below trend and twenty twenty five May two, those under earning years should then be followed by stronger than average ones. So we feel really good about the fundamentals we can control. We're confident our business can compound growth at attractive rates in a more normalized RevPAR environment. Operator00:29:55We'll take our next question from Brent Montour with Barclays. Please go ahead. Your line is open. Brandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment Bank00:30:02Good morning, everybody. Thanks for taking my question. So I was I wanted to talk a little bit about the development backdrop. The net unit growth in the first quarter was just I mean, we calculated it's just a touch below the range for the year. And so that you guys are reaffirming that it implies a little bit of a lift as you go through the year. Brandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment Bank00:30:24Wondering if A, that's sort of plan what you guys expected to happen as you go through the year? And second, maybe Jeff if you could just talk about the your 70% your opens are conversions. Can you just talk about the puts and takes of the conversion business and that momentum as it pertains to the current backdrop I. E. Cost for furnished goods going up, but of course we've got this potential counter cyclicality effect of slowing RevPAR potentially helping. Brandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment Bank00:30:53Hope that all makes sense, but any thoughts there would be helpful. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:30:56There's a lot in there, Brent. And I'll start with where you started. I think we feel very good about the first quarter in terms of where we landed. As you know, our openings ramped throughout the year and it was very consistent. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:31:11There's a good slide Matt put in the deck in terms of what we needed to do this quarter and we felt we did it. And again, nothing out there that as I said to Mike is making us doubt our long term 3% to 5% algo. In terms of conversions, the second part of your question, we there's I think it's Slide six in the IP, which talks about our ability to flex up, but we were around 90% conversions during COVID, which as new constructions came down conversions came up. And you saw that normalize in our investor presentation, 70% of our full year 2024 openings, given the strength and the success of our new construction prototypes. And that has continued to pick up. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:31:57Our new construction openings picked up by 500 basis points both domestically and internationally to nearly a third of all of our openings. And with our executions, our new construction pipeline being up 400 basis points to 1,500 hotels in the first quarter, quarter on quarter, we're not seeing that slow down. So is there the ability to flex up in conversions? Absolutely. Domestically, our conversion pipeline was up double digits versus last year. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:32:28But we're feeling really, really good about it domestically. We're feeling great about it internationally. We met with dozens of developers this quarter in Southeast Asia, where our signings were strong, our conversion pipeline. We grew in Southeast Asia significantly in the quarter and in China, still real strong strength out there. You saw 90% more room openings in last quarter and a 17% domestic net room growth over there. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:32:56And then in Europe, we talked about that 40% increase in the pipeline, I believe in our script. We were over in India where gee whiz, I mean infrastructure demand is exploding and hotel supply just can't keep up. We were in India the first franchise company to enter India before franchising was even as popular as it is today. And we are today company with more franchise hotels than anyone else. And India is really what's helping fuel our EMEA growth in both the openings in the pipeline. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:33:31And then the last part of your question on what we're hearing in terms of costs, tariffs and whether or not that's going to slow things down. Tariffs, supply chain, stability on those fronts, certainly top of mind. But our teams are doing a great job of shifting sourcing, bringing production closer to home and negotiating with suppliers to share in the increased costs. There's always been a concern and you read a lot about the cost of steel and aluminum in the industry. But with us in our type of construction, we're a lot less about steel and aluminum, much more so focused on lumber, which is a huge driver of cost. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:34:16Most of our new construction is stick construction as opposed to steel and aluminum construction. And happily, the administration exempted Canadian lumber from the new tariffs, given I think what it knew its impact would be on new construction. And then the concern shifts to imported fixtures, furniture, equipment, technology, electronics. But we're optimistic and I think our franchisees are as well, Brent, that the uncertainty that's out there could be relatively short lived. I mean, we've worked through they've worked through supply chain disruption before and they are increasingly looking to us for help and our teams are increasingly sourcing domestically wherever possible. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:34:57In fact, we're mandating at least one domestic sourcing solution for all important supply categories. For example, our FF and E for our new Days Inn Dawn prototype, Days Inn is our best performing economy brand right now and its RPI just keeps going up and Days In Don prototype is a big part of that. It's being sourced entirely from North Carolina or Texas. Our Echo Suites, which we've talked a lot about, our fastest growing new construction brand launch yet, all of that FF manufactured in Minnesota, where we're not seeing any costs increase yet. So where sourcing is not domestic, we're certainly expanding solutions in other countries when it comes to things like technology like Vietnam and Cambodia. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:35:47And we're again optimistic that this is going to be more temporary than long term. I hope that answered it. Operator00:35:57We'll take our next question from David Katz with Jefferies. Please go ahead. Your line is open. David KatzManaging Director at Jefferies00:36:05Hi. Good morning, everybody. Thanks for taking my question. No babies here. None I was just going to leave it right there. David KatzManaging Director at Jefferies00:36:21Okay. I wanted to talk about okay. I wanted to talk about your development engine and sort of the development process, right? Easy to get sort of sucked into the near term RevPAR and demand etcetera, which is relevant. But taking a long term view on how you're one sort of allocating resources driving Nug, building a pipeline, I'd love some geographic updates on how you're doing in different areas. David KatzManaging Director at Jefferies00:36:54There's been a lot of concern about what might be going on in Asia or elsewhere with it. And if you could, Michel, just talk a little bit about sort of key money and key money strategies. It's another area that we're all quite interested in. Thank you. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:37:10Okay. I'll start off and pass it to Michelle on key money. She's very tough about those key money allocations and we're not doing much of it to the chagrin of our international presidents overseas nor do we have to. And I mean you mentioned Asia, that's a good place to start. We were over there this quarter and we've just seen continued acceleration on both the execution and the development front. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:37:34We are bringing in fee par accretive rooms. We opened 90% more rooms. Many of our peers have been talking about building master license relationships over there and how well they're working for them. We've been very focused having entered China, for example, twenty years ago with master license to focus more on selling the 20 plus brands that are not master license directly, because they're coming in at much higher fee parts, much higher license fees. And so while we opened 90% more rooms, the team executed so many more deals, over 50 deals, more deals executed than they did last year. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:38:18And our Asia Pacific pipelines, whether it's in countries like Thailand or Singapore, we are seeing robust growth and we're seeing really strong growth on both the new construction side and on the conversion side. We have continually invested in our franchise sales and development teams overseas. Europe is a big, big area right now that we're focused on that's doing very well from both an application standpoint and an opening standpoint as is Latin America. So we continue to increase our sellers, our franchise sales team. We're focused entirely right now on selling direct franchise agreements as opposed to master license agreements overseas and we're using very little key money to do that. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:39:19Michelle? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:39:21Sure. From a key money strategy, we are prioritizing opportunities David as you know that deliver high quality revenue accretive fee par to the system. That means we're focusing on higher RevPAR markets where we can or already do have scale and where we can drive pricing. I'd say internationally we're being selective and strategic about how we direct the capital even how we direct our human capital. And you'll see us do a good bit of volume in EMEA this year, specifically in Germany. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:40:04We really like the structure of that market being the largest economy in Europe. But as Jeff mentioned, we're not deploying capital into China for example. So being very selective and very strategic. We know this strategy is working. It's worked really well for us over the last few years and we continue to add more attractive markets into the system. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:40:32Just this quarter we added Singapore for instance internationally. And the deals that have development advances associated with them are coming in at much higher fee pars. So we're really thrilled to be seeing this strategy executing according to our expectations and the teams are really happy to have this tool in their toolkit. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:40:55And very happy to see without a lot of key money as Michelle mentioned going out internationally that international pipeline coming in with a fee par premium of over 30%. I think it's 32% of what is in our existing international system. Operator00:41:13And we'll take our next question from Stephen Grambling with Morgan Stanley. Please go ahead. Your line is open. Stephen GramblingManaging Director at Morgan Stanley00:41:21Thanks. And this is just a follow-up on that question. I guess sometimes when what we see now is the output of several years of efforts as we think about what might happen going forward and the major changes you see in the development environment. Maybe if you can just elaborate on how either the terms of the structure of agreements maybe have changed over the past few years of higher interest rates? And then just to clarify, I think the loan advances you cited there were up a little bit. Stephen GramblingManaging Director at Morgan Stanley00:41:52Is that and that's just is that related to moving upstream? Or is that new markets? And then what's the typical, I guess, payback that we should think about on those? Thank you. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:42:03Yes, sure. With respect to the loan advances, we had an opportunity to advance our partnership with one of the premier developers in Germany. I just mentioned that was a strategic and is a strategic market for us. We're able to strengthen our footprint in this very important region, Germany's largest economy, highest BPAR market of North America and we've been really focused on building density there. This portfolio will add over 3,000 rooms to our system over the next few quarters as we integrate it. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:42:40And you can see that impact in the EMEA pipeline, is up 40% for the region. Stephen GramblingManaging Director at Morgan Stanley00:42:51Got it. And I guess are those kind of standard terms or do we see that get paid back over a typical length of time or do we assume Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:43:00Oh, Yes. It's definitely an interest bearing loan and it will be paid back over I believe the next two years. Operator00:43:13And we'll take our next question from Dani Assad with Bank of America. Please go ahead. Your line is open. Dany AsadDirector at Bank of America00:43:21Hi. Good morning, everybody. Just a follow-up question on your change in outlook comments, Michel. You talked about the low end run rating at down 3%, the top end of the guide being up 1% for the balance of the year. Can you maybe break that down for us by what's changing in your outlook by region? Dany AsadDirector at Bank of America00:43:40So what's changing in The U. S? And then how is your outlook in the rest of the world changing? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:43:46Sure. Yeah. Actually my prior comments were with respect to The U. S. Only because I think that was the exact question. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:43:54So let me just clarify. In The U. S, we're assuming that we see the continued pressure from March and April for the remainder of the year. So that would have us down 3% on a normalized basis. Of course, it's going to be down a little bit more in the fourth quarter when you take into account lapping the hurricane headwinds, but it will all average out to down 3% for the remaining the remainder of the year. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:44:23Internationally, I'd say we've taken a generally consistent approach using the more recent trends in each of the regions to project out the rest of the year. Every region as you know faces its own dynamics. China has faced more recent pricing pressure. EMEA momentum has continued. LATAM is seeing exceptional ADR growth. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:44:45In Canada, we're assuming again consistent March and April performance, which was not really stellar. So overall, we're expecting international RevPAR to decline about one point on a constant currency basis. Operator00:45:04And we'll take our next question from Steve Pizzella with Deutsche Bank. Please go ahead. Your line is open. Steve PizzellaAnalyst at Deutsche Bank00:45:12Hey, good morning, everyone. I just wanted to follow-up on the encouraging recent trends comment again. Maybe you could expand on where you are seeing that and if you think they are sustainable? And if these recent trends were continue, would that get you to the midpoint of the EBITDA guidance? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:45:31So, I'd say our guidance is meant to reflect any range of outcomes. At the low end, we are assuming pretty generally speaking that the trends we saw in March and April continue for the remainder of the year. Again, there is potential as Jeff mentioned that those trends were more transitory and that we would see improvement from that and we're starting to see some early signs of positive momentum. But to be fair, starting to see some early signs of positive momentum and the majority of our EBITDA is going to come in those very important summer months. So until we have full visibility of what that looks like, it's really we really just need to see how those are going to perform. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:46:23What's going to get us to the midpoint or the higher end is improved performance from those March and April trends obviously. We would expect to be closer to the midpoint, I'd say, than the lower end if we see improvement from that down 3% in The U. S. Operator00:46:45And we'll take our next question from Patrick Scholes with Truist. Please go ahead. Your line is open. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:46:52Great. Thank you. Good morning, everyone. No plans for any more children in my family. We are good there in that department. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:47:04Thank you. Patrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist Securities00:47:07Question here on the ancillary revenues. I believe last quarter you had called out an expectation for low teen growth for this year. Certainly since last quarter, I believe it was in February, we've seen declining consumer confidence. Is your expectation still the same for low teen ancillary revenue growth? Patrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist Securities00:47:38Thank you. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:47:39Hi, Patrick. Sure. Yes, we continue to expect 2025 growth to be in the low teens range and there are further growth opportunities beyond 2025 including international expansion. And so we continue to expect it will be higher than low teens in 2026. As it relates to this year and this current RevPAR environment, I'd say a significant portion of our ancillary revenue is contract based, which provides a high level of visibility and durability. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:48:10And then the largest growth driver this year as you know is expected to be our co branded credit card. And the non contractual piece of our card income is based on total card spend not just travel spend and only about a third comes from the travel category. So I think that makes us fee stream more insulated from RevPAR fluctuations and we feel really comfortable at this stage and where we're guiding right now from a RevPAR outlook that the ancillary fees will continue to grow in that low teens range for 25%. Patrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist Securities00:48:47Okay. Could you just give a little bit of explanation exactly what a contracted it sounds like that's something that's locked in no matter what happens here. What exactly is that? Thank you. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:48:59Sure. With respect to license fees, for example, there is a minimum floor that P and L will pay to Wyndham. So their VOI at P and L would need to drop pretty materially before we would eat into that floor. So it provides kind of a base space. Operator00:49:26And we'll take our next question from Ian Zaffino with Oppenheimer. Please go ahead. Your line is open. Ian ZaffinoManaging Director at Oppenheimer & Co. Inc.00:49:34Hi, great. Thank you. Maybe talk about like the trends you're seeing in infrastructure right now. Have you really seen any impact from macro? Do you expect to see any softening there? Ian ZaffinoManaging Director at Oppenheimer & Co. Inc.00:49:47Or is it kind of just steady as she goes? Thanks. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:49:52Thanks. Ian, we did as I mentioned in Lizzie's question see a bit of a slowdown in the first quarter versus the fourth quarter with the halting of disbursements of infrastructure funds in January. But the IIJA allocations are gradually resuming. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:50:13Several of us, several hotel and airline CEOs had the opportunity to meet a few weeks ago with Transportation Secretary Sean Duffy down in D. C. And the assurance that the administration's main focus is all about getting the balance of the allocations out, but more importantly as Secretary Duffy actually spent. The administration wants faster spending on highway and bridge construction, big beautiful highways, big beautiful bridges. There is just too much economic growth. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:50:49There's too much job creation. There's too much economic stimulus to boost GDP for this, as Secretary Duffy put it to us, not to happen in terms of making the transportation infrastructure stronger. And we certainly heard that for anybody that was listening yesterday to the televised cabinet meeting in the White House, all about getting those funds flowing when it comes to things like our nation's airports and air traffic control or the recent Energy Dominance executive order to expand oil and gas exploration that Secretary Wright talked about yesterday. And we're starting to see that. Our GSO revenue growth continued to pick up. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:51:34It was up smaller numbers, but it was up 30% year on year. And so much of that is driven by infrastructure and by our remote sales teams that franchisees can opt into for sales support actually availing themselves of the demand that those contracts are creating. Our consumed GSO revenue in the first quarter from infrastructure room nights exceeded The U. S. STR industry growth by about three eighty basis points. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:52:05So that's helping us drive continued mid scale mid week share gain. And we're also seeing strong private investment with dozens of hotels near our nation's largest data centers. Secretary Lutnick, they were all talking about it yesterday was referencing what's going on out in Arizona with TSMC and the investment that they're making. We have dozens of hotels that are seeing the benefits of that demand. So we continue to view the infrastructure spend that $1,200,000,000,000 bill as a multiyear tailwind that's going to be driving over $3,000,000,000 of gross room revenue to our hotels in the next eight to ten years. Operator00:53:09We'll take our next question from Alex Bregnant with Redburn Atlantic. Please go ahead. Your line is open. Alex BrignallManaging Director - Research Analyst at Redburn Atlantic00:53:18Good morning. Thank you for taking the question. On the German deal, could you just give us some more detail on the terms of that on the nature of the 3,000 rooms if they're already existing on new construction? And whether there are any similar deals that you have in the pipe that could come through later down the line? Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:53:48Sure. I probably can't disclose specific terms for competitive reasons. I can say that it is a structure that allowed us to provide financing to a partner that was well above our cost of capital and with strong structural provisions and personal guarantees. We're always judicious with our capital and make sure when we deploy it, it's above our hurdle rates. Our first priority is investing in the business and in high quality growth. Michele AllenCFO & Head of Strategy at Wyndham Hotels & Resorts00:54:34And I'd say an asset light cash generative business like ours gives us flexibility even in uncertain times to evaluate opportunities on a case by case basis and deploy capital where it creates the most long term value. Could there be potential opportunities like this in the future? We hope so. Bringing in 3,000 high quality CPAR accretive rooms in one of our key strategic markets is something we're incredibly excited about. And so I think when we think about deals and what makes most sense for the long term health of our business, we have a number of tools in the toolkit and we deploy them very strategically. Operator00:55:29And we will take our last question today from Dmitry Waselek with Morningstar. Please go ahead. Your line is open. Dan WasiolekAnalyst at Morningstar00:55:38Hey, good morning guys. Yeah, just wondering your commercial team seems to be leading the industry in innovative technology solutions. What opportunities are you providing owners in this environment to lower costs and increase top line growth? Thank you. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:55:51Well, thank you for that shout out Dan. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:55:53I'm sure Scott Strickland and incredible commercial team appreciate it. They've been very busy. Over the last six years, we've talked a lot about it's in our investor deck. We've invested over $300,000,000 in what has become an industry leading tech stack. We have completely moved off of legacy providers. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:56:11We have best in class providers that are entirely cloud based like Oracle and Amazon and Adobe. Canary is our most recent and exciting partner. And all of these partners along with Sabre of course, which is all of where all of our ARI is held, it's enabling us to innovate faster. It's taking labor intensive tasks away from our franchisees and it's really raising the service bar for our customers. Most importantly for our small business owners, we'll be talking a lot about this at our global conference, it's allowing them to make extra money. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:56:47But our approach with our franchisees and small business owners is not to mandate these services, these programs, this technology, but to offer them on an opt in basis. And when we have 5,000 of our 6,000 U. S. Franchisees opting into services like our signature reservation service, where they don't have to employ a front desk agent to check Dan Woziolik in, but they're able to actually service them while all of those calls are bounced to a professionally run call center that's delivering a much faster average speed of answer, a much higher conversion rate and a significantly higher up to 15% higher ADR lift. That's a big deal. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:57:33And they'll sign up for that all day long as they will our opt in revenue management services, which drive hundreds of increased basis points of occupancy or I mentioned earlier our sales support where we're hiring salespeople across the country because small business owners can't necessarily afford them on their team, but are willing to opt into those type of services. We're also offering free services that any small business owner would be crazy not to opt into like our ability to reconcile OTA reservations that don't show up at no cost delivering thousands of dollars of savings a month. I could go on and on. We've talked a lot about Wyndham Connect. It will be a big push for us at conference. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:58:20Over three quarters of our franchisees have opted into because it is a best in class suite of technology that's allowing monetization efforts for franchisees to now charge effortlessly, seamlessly for an early check-in for the Wagiolix family or a late checkout or what they might want in their room before they arrive. So we're really excited about it. It's a big piece of our value proposition and something that our franchise sales teams are very proud of offering to our franchisees. Operator00:59:00And there are no further questions on the line at this time. I'll turn the floor back to Jeff Bellotti for any closing remarks. Geoff BallottiPresident, CEO & Director at Wyndham Hotels & Resorts00:59:07Thank you very much, David, and thanks everyone for joining us and for your questions today and your continued interest in Wyndham Hotels and Resorts. Michelle, Matt and I look forward to seeing many of you at the upcoming investor conferences that we'll be at in the weeks ahead and to spending time with thousands of our franchisees, our team members from around the world and our strategic sourcing partners at our twenty twenty five Wyndham Global Hotel Conference in Las Vegas at Caesars Forum from May 19 to the 21 this month. Have a great day everyone. Operator00:59:41Thank you. And this does conclude today's Wyndham Hotels and Resorts first quarter twenty twenty five earnings conference call. Please disconnect your line at this time and have a wonderfulRead moreParticipantsExecutivesMatt CapuzziSVP IRGeoff BallottiPresident, CEO & DirectorMichele AllenCFO & Head of StrategyAnalystsLizzie DoveVice President Equity Research at Goldman SachsMichael BellisarioManaging Director at BairdBrandt MontourDirector, Equity Research Analyst at Barclays Corporate & Investment BankDavid KatzManaging Director at JefferiesStephen GramblingManaging Director at Morgan StanleyDany AsadDirector at Bank of AmericaSteve PizzellaAnalyst at Deutsche BankPatrick ScholesManaging Director - Lodging & Leisure Equity Research at Truist SecuritiesIan ZaffinoManaging Director at Oppenheimer & Co. Inc.Alex BrignallManaging Director - Research Analyst at Redburn AtlanticDan WasiolekAnalyst at MorningstarPowered by