What Wyndham Hotels & Resorts (WH) Said on Its Q3 Earnings Call

Key Points

• Strong U.S. performance drove the quarter: Domestic RevPAR rose 6%, supported by higher occupancy, rates, business travel and leisure demand. Adjusted EBITDA increased 5% and adjusted diluted EPS rose 9% year over year.
• Wyndham’s growth pipeline reached a record: The company opened more than 18,000 rooms, while its pipeline expanded to approximately 264,000 rooms across nearly 70 countries. Management is prioritizing higher-fee properties and removing lower-quality rooms, even as China remains a weak international market.
• Wyndham raised its 2026 outlook and continued returning capital: The company now expects $740 million to $745 million in adjusted EBITDA and $4.84 to $4.92 in adjusted diluted EPS. It repurchased $91 million of shares and paid $32 million in dividends during the quarter, while increasing its buyback authorization by $400 million.

Wyndham Hotels & Resorts NYSE: WH reported third-quarter results marked by stronger-than-expected U.S. revenue per available room growth, higher franchise fee revenue and an increased full-year outlook for several financial measures.

Chief Executive Officer Geoff Ballotti said comparable adjusted EBITDA rose 5% from a year earlier and adjusted diluted earnings per share increased 9%. U.S. RevPAR grew 6%, while the company’s system expanded 4% excluding Revo-related rooms. Ballotti also said the company generated nearly $270 million of free cash flow through the first nine months of 2026 and returned more than $290 million to shareholders.

Ballotti provided an update on his treatment for multiple myeloma, saying doctors were pleased with his progress and that he was seeing “exceptional clinical results.”

U.S. Demand and Pricing Support RevPAR Growth

Global RevPAR increased 2% in constant currency during the quarter, representing a nearly 400-basis-point sequential improvement. Domestic RevPAR rose 6%, exceeding Wyndham’s expectations for the second half of the year. The World Cup contributed about 10 basis points to U.S. RevPAR growth, according to Ballotti.

Occupancy rose by about 300 basis points, while average daily rate increased approximately 280 basis points. Ballotti attributed the gains to everyday business travel and broad-based leisure demand, saying middle-income consumer travel demand remained resilient despite higher gasoline prices.

Texas, California and Florida, which collectively represent about one-quarter of Wyndham’s U.S. rooms, delivered combined RevPAR growth of 8% in the quarter. The company also cited gains in Iowa, Illinois, Ohio and Indiana, where it said hotels are benefiting from demand associated with transportation, manufacturing, artificial intelligence, data center and industrial projects.

During the question-and-answer session, Ballotti said Wyndham had more than 7% additional business booked for the following 60 days compared with the prior year. He also said booking windows, cancellation rates, average drive distances and lengths of stay had improved. Chief Financial Officer Amit Sripathi said weekday performance exceeded weekend performance by 150 basis points, while both occupancy and average daily rate were strong.

International Trends Improve, Though China Remains Weak

International RevPAR declined 3% year over year in constant currency, but this was a nearly 400-basis-point sequential improvement. Canada RevPAR grew 7%, Southeast Asia and the Pacific increased 5%, Latin America rose 2% and Europe, the Middle East and Africa increased 2%.

Wyndham cited improved conditions in Germany and stabilization in the Middle East, where RevPAR improved from a 45% decline in the second quarter to a 13% decline in the third quarter. Ballotti said the company’s pipeline in the Middle East remained strong, with more than two dozen hotels in development and five recently executed contracts in Saudi Arabia and the United Arab Emirates.

China remained a headwind, with RevPAR down 10% as softer travel demand weighed on Tier 2 cities. However, Ballotti said Wyndham hotels in China held average daily rates flat from the prior year. He added that Wyndham’s China direct-franchising and overall franchising systems continued to generate double-digit net room growth.

Pipeline Reaches Record and Company Emphasizes Quality

Wyndham opened more than 18,000 rooms in the quarter, 3% more than a year earlier. Its pipeline grew for the 25th consecutive quarter to roughly 264,000 rooms in nearly 70 countries. The pipeline carries an estimated FeePAR premium of about 30% domestically and internationally.

The company said it is increasingly emphasizing higher-fee hotels and terminating lower-quality rooms. U.S. openings during the quarter had a FeePAR premium of more than 45% relative to terminations, while international openings had a premium of nearly 40%.

Sripathi said Wyndham narrowed its 2026 net room growth outlook, excluding Revo, to about 4% from a prior range of 4% to 4.5%. The change reflects the removal of substandard rooms and a shift toward higher-value opportunities, he said. The company expects most Revo-related rooms to leave the system before year-end, with approximately 5,000 to 6,000 expected to remain.

Management said lower hotel transaction volumes and subdued new construction affected domestic net room growth. Ballotti said economy and midscale transaction volumes fell more than 30% during the quarter, but the company expects pent-up conversion demand to emerge as transaction activity normalizes.

Technology, Loyalty and Capital Returns

Wyndham said ancillary revenue increased 10% year to date, supported by expanded partnerships, technology initiatives and the refreshed Wyndham Rewards credit card portfolio. Wyndham Rewards membership rose 10% to approximately 129 million members, and members accounted for more than half of domestic check-ins.

The company also highlighted its artificial intelligence initiatives. Wyndham Connect, its guest-engagement platform, was deployed at more than 5,100 hotels and generated tens of millions of dollars in year-to-date upsell opportunities for participating franchisees. Wyndham AI Concierge was operating at more than 1,700 hotels, up 17% sequentially, while Wyndham Gateway was live at more than 1,100 hotels.

For the quarter, Wyndham reported $410 million in net revenue, up 7% year over year, and $207 million in adjusted EBITDA. Adjusted diluted EPS was $1.43. Free cash flow totaled $100 million during the quarter and $269 million year to date.

The company repurchased $91 million of shares in the third quarter and paid $32 million in dividends. Year to date, it repurchased 2.5 million shares for $196 million. Wyndham ended the quarter with nearly $1 billion of total liquidity and a net leverage ratio of 3.6 times. Its board added $400 million to the share repurchase authorization during the quarter.

Updated 2026 Outlook

• Global RevPAR growth is now expected to be 0.5% to 1%.
• Net revenue is projected at $1.48 billion to $1.5 billion.
• Adjusted EBITDA is expected to be $740 million to $745 million.
• Adjusted net income is projected at $363 million to $369 million.
• Adjusted diluted EPS is expected to be $4.84 to $4.92, based on 74.9 million diluted shares.

Sripathi said the revised forecast assumes fourth-quarter U.S. RevPAR performance remains consistent with third-quarter levels and international markets continue to improve. The company maintained its expectation that full-year free cash flow will convert at roughly 55% to 60% of adjusted EBITDA.

About Wyndham Hotels & Resorts (NYSE:WH)

Wyndham Hotels & Resorts, Inc is a global hotel franchising company that operates an asset-light lodging business. Rather than owning and managing most of its hotels, the company licenses its brands and provides franchisees with support in areas such as marketing, reservations, technology, training and operational standards.

Its portfolio includes a range of economy, midscale and upscale hotel brands, including Super 8, Days Inn, Ramada, La Quinta, Microtel, Baymont, Wingate, AmericInn, Wyndham, Wyndham Garden, Registry Collection Hotels and ECHO Suites Extended Stay by Wyndham.

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