Vail Resorts Q2 Earnings Call Highlights

Key Points

• Vail said the Rockies saw the company’s “most difficult weather environment,” with historically low snowfall and warm temperatures limiting terrain (only about 70%–80% of acres open) and contributing to roughly –5% total net revenue, –3% lift revenue, –8% Resort Reported EBITDA and ~–12% season-to-date skier visitation.
• Management lowered fiscal 2026 guidance and warned of greater variability driven entirely by weather, now expecting net income of $144–190 million and Resort Reported EBITDA of $745–775 million.
• Management highlighted mitigating actions: the pass program’s stability (pass holders ≈75% of visitation; pass sales up ~3%), early “green shoots” from new ticketing initiatives, exceeding its $100M cost‑savings target by about $6M, ~$1.1B liquidity and retirement of $525M of convertible debt.

Vail Resorts NYSE: MTN reported fiscal second-quarter 2026 results that management said were heavily pressured by what it described as the most difficult weather environment the company has ever seen in the Rockies. Executives emphasized that historically low snowfall and unusually warm temperatures limited terrain availability, reduced visitation, and weighed on profitability, even as the company pointed to the stabilizing effect of its pass program, early traction from new ticketing initiatives, and record-high guest satisfaction scores.

Historically low snowfall in the Rockies drives results

Chief Executive Officer Rob Katz said snowfall and snowpack in the Rockies were at or near all-time historic lows through February, calling it worse than fiscal 2012, previously the company’s poorest Rockies season. He added that Colorado experienced the warmest winter to date on record, citing February temperatures that were nine degrees warmer than average in the Rockies.

Those conditions, Katz said, affected the company’s ability to open terrain. He cited the latest opening of the Back Bowls at Vail Mountain and the Imperial Lift at Breckenridge, and said only 70% to 80% of acres were open through the end of February at the company’s Colorado and Utah resorts. Given that the Rockies are the largest driver of resort EBITDA, Katz said the impact on results was “outsized.”

While the Rockies were weak, Chief Financial Officer Angela (referred to as Angela on the call) said conditions in Whistler and Tahoe were variable, and conditions in the East were strong this season, which partially offset the pressure and underscored the geographic diversification of the resort portfolio.

Quarterly and season-to-date performance

For the fiscal second quarter, management reported:

• Total net revenue declined approximately 5% year-over-year.
• Lift revenue declined approximately 3% despite visitation being down 13%, which management attributed to the stability provided by pass sales.
• Resort Reported EBITDA declined approximately 8% year-over-year, with cost discipline and savings from the Resource Efficiency Transformation Plan partially offsetting weather impacts.

For season-to-date metrics through March 1, the company said skier visitation declined approximately 12%. Lift revenue declined approximately 4% as growth in pass revenue was offset by declines in non-pass lift ticket revenue. Management highlighted the breadth of the weather impact, noting that even its “most committed pass visitation” declined approximately 14%, while non-pass lift ticket visitation declined approximately 6%.

Ancillary revenue trends improved compared with January metrics but remained down versus the prior year due to lower visitation, partially offset by increased yield per visit, the CFO said.

Updated fiscal 2026 outlook reduced; guidance variability increases

Management lowered its fiscal 2026 guidance due to persistent challenging weather conditions in the Rockies through February, which continued to limit terrain availability.

• Net income attributable to Vail Resorts is now expected in the range of $144 million to $190 million.
• Resort Reported EBITDA is now expected in the range of $745 million to $775 million.
• Cash taxes are now expected to be approximately $95 million to $105 million.

Executives also cautioned that there is greater variability in the updated guidance despite limited time left in the season. Katz said that with low snowpack, conditions can change more quickly than in a typical year, making late-season results more sensitive to whether storms materialize or temperatures rise. Management also stated that the increased uncertainty was entirely weather-driven, not related to macroeconomic or geopolitical factors.

Pass strategy, pricing changes, and early ticketing “green shoots”

Katz said the season reinforced the importance of the company’s advance commitment strategy. While pass units may have declined a couple of points over the past few years, he said pass units have grown 55% over the past five years, with pass holders now representing approximately 75% of annual visitation.

Heading into the season, management said pass sales were up approximately 3%. Katz said the company “materially changed the trajectory” of pass sales after Labor Day through enhanced marketing and new products, which he described as critical going into this season.

For the 2026-2027 season, the company launched pass sales with several updates, including:

• A new pricing tier for skiers and riders ages 13 to 30 at 20% less than standard pricing, which management said is aimed at a price-sensitive cohort and intended to keep young adults engaged in the sport.
• 3% to 4% price increases for the Epic and Epic Local Pass before taxes, with management citing an approximately 3% to 4% blended price increase before mix changes when accounting for other product adjustments.
• Passing through sales and lift taxes on multi-resort passes in the same way the company does for lift tickets and other mountain products; management said the tax rate for most passes is approximately 3%.
• Targeted changes to Epic Day Pass pricing to incentivize frequency, including higher increases on one- to two-day passes and year-over-year decreases on six- to seven-day passes.

On lift ticket initiatives introduced this season, Katz highlighted what he called positive early reception despite weak conditions. He said Epic Friend Ticket redemption rates were up over legacy passholder benefit tickets, and that the product showed visitation growth compared to declines in traditional ticket types. He also said one-month advance lift tickets showed signs of moving guest purchasing earlier, and that off-peak pricing at select resorts produced encouraging early results, though management said the season’s weather made the initiatives difficult to fully evaluate.

Cost savings, capital allocation, and balance sheet actions

Management credited disciplined cost management and continued progress under its Resource Efficiency Transformation Plan as partial offsets to the season’s pressure. The CFO said the company now expects to exceed its initial $100 million annualized savings target by approximately $6 million by the end of fiscal 2026. For fiscal 2026, the company expects approximately $42 million of incremental savings versus the prior year, before approximately $15 million of one-time operating expenses.

On liquidity and leverage, the CFO said the company ended the quarter with approximately $1.1 billion of liquidity and net leverage of 3.1x trailing 12-month EBITDA. During the quarter, the company retired $525 million of convertible debt using a combination of net proceeds from a delayed draw term loan and cash on hand. The company also amended its credit agreement on Feb. 9 to extend the maturity date to 2031, revise pricing levels, and slightly increase facility size.

Vail Resorts reaffirmed its calendar year 2026 capital plan, calling for core capital expenditures of $215 million to $220 million and total capital spending of $234 million to $239 million, with a continued focus on technology investments that can be deployed at scale. The company maintained its quarterly dividend at $2.22 per share, and said it repurchased 0.3 million shares for $45 million year to date. Management said it reevaluated the current dividend level in light of this year’s results and elected to hold the dividend flat, arguing the cash flow decline was not indicative of long-term cash generation potential.

Katz and the CFO both pointed to record-high system-wide guest satisfaction scores this season, including year-over-year increases in Colorado and Utah, which Katz attributed to frontline execution. Looking ahead, Katz reiterated confidence in ongoing marketing and product optimization efforts and in guest-facing technology initiatives, including implementation of a new content management system that he said would support greater personalization and agility for next season.

About Vail Resorts NYSE: MTN

Vail Resorts, Inc is a leading mountain resort company that owns and operates an integrated network of ski areas, hotels, restaurants and retail outlets. The company's signature Epic Pass program offers skiers and snowboarders season‐long access to its portfolio of resorts, while ancillary services such as ski and snowboard schools, equipment rental and retail drive additional revenue.

Headquartered in Broomfield, Colorado, Vail Resorts was formed in 1997, building on the legacy of Vail Associates, which opened the Vail ski area in 1962.

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