Executive Summary

Q2 2025 RevPAR declined 0.4% year over year to $155 as ADR held at $191 and occupancy remained strong at 82%; Silicon Valley RevPAR rose 3% and May set all-time highs for ADR and RevPAR .
Diluted EPS was $0.07 versus Wall Street consensus of $0.06; revenue slightly beat at ~$80.0M vs ~$79.7M, while EBITDA modestly missed; Adjusted FFO per share was $0.36, at the top of guidance *.
Guidance: Q3 2025 RevPAR (-1.5% to +0.5%), Adjusted EBITDA $24.7–$26.8M, AFFO/share $0.29–$0.33; FY 2025 guidance broadly maintained (Adjusted EBITDA $89–$93M, AFFO/share $0.95–$1.03) .
Capital allocation and balance sheet catalysts: completed sale of five low-RevPAR assets ($83M proceeds), repurchased 20,480 shares at $7.02, and reduced leverage to ~21% net debt to hotel investments cost; management plans to recast/upsized credit facility in Q3 to lower borrowing costs .

What Went Well and What Went Wrong

What Went Well

Industry outperformance and resilience: “we beat industry performance again... our streak grows to three and a half years”; Q2 occupancy of 82% matches a post-pandemic high .
Silicon Valley and leisure strength: Silicon Valley RevPAR up 3% and hotel EBITDA up ~3% to almost $5M; leisure hotels’ RevPAR up 4% ex-Portsmouth; May hit all-time highs for ADR/RevPAR .
Margin control despite flat RevPAR: GOP margin +30 bps YoY; labor/benefit costs down 7% per occupied room aided by ~$0.8M workers’ comp refund (improving margins by ~110 bps) .

What Went Wrong

Top-line and profitability softer YoY due to asset sales: Total revenue ~$80.3M vs ~$86.5M in Q2 2024; Adjusted EBITDA $28.5M vs $31.4M; AFFO/share $0.36 vs $0.39 .
Convention-related headwinds: Dallas impacted by multi-year convention center closure (Dallas RevPAR -9%; Courtyard Dallas Downtown RevPAR -17%); San Diego’s 2025 convention calendar down vs 2024 .
Booking costs pressure: guest acquisition commission costs up ~15%, compressing margins by ~30 bps .

Financial Results

Consolidated P&L and Key Metrics (older → newer)

Metric	Q4 2024	Q1 2025	Q2 2025
Total Revenue ($USD Millions)	$75.1	$68.6	$80.3
Net Income to Common ($USD Millions)	$(3.7)	$(0.5)	$3.4
Diluted EPS ($)	$(0.08)	$(0.01)	$0.07
Adjusted EBITDA ($USD Millions)	$21.1	$17.9	$28.5
AFFO ($USD Millions)	$10.0	$7.4	$18.5
AFFO per diluted share ($)	$0.20	$0.14	$0.36

Operating KPIs (older → newer)

KPI	Q4 2024	Q1 2025	Q2 2025
RevPAR ($)	$129	$127	$155
ADR ($)	$176	$176	$191
Occupancy (%)	74%	72%	82%
GOP Margin (%)	41%	39%	46%
Hotel EBITDA Margin (%)	33%	31%	39%

YoY Comparison – Q2 2025 vs Q2 2024

Metric	Q2 2024	Q2 2025
Total Revenue ($USD Millions)	$86.5	$80.3
Diluted EPS ($)	$0.10	$0.07
Adjusted EBITDA ($USD Millions)	$31.4	$28.5
AFFO per diluted share ($)	$0.39	$0.36
RevPAR ($)	$156	$155
GOP Margin (%)	46%	46%
Hotel EBITDA Margin (%)	39%	39%

Market RevPAR Breakdown (Q2 2025 vs Q2 2024)

Market (% LTM EBITDA)	Q2 2024 RevPAR ($)	Q2 2025 RevPAR ($)	YoY Change
Silicon Valley (16%)	$150	$154	+3%
Los Angeles (10%)	$163	$165	+1%
Coastal Northeast (9%)	$183	$175	-4%
Washington, D.C. (9%)	$184	$180	-2%
Greater New York (8%)	$170	$169	~0%
San Diego (7%)	$209	$219	+5%
Dallas (5%)	$118	$107	-9%
34-Hotel Portfolio	$156	$155	-0.4%

Guidance Changes

Metric	Period	Previous Guidance (Q1 2025 PR)	Current Guidance (Q2 2025 PR)	Change
RevPAR ($)	Q3 2025	—	$153–$156	New
RevPAR Growth (%)	Q3 2025	—	(-1.5%)–0.5%	New
Total Hotel Revenue ($M)	Q3 2025	—	$78.8–$80.3	New
Adjusted EBITDA ($M)	Q3 2025	—	$24.7–$26.8	New
AFFO per diluted share ($)	Q3 2025	—	$0.29–$0.33	New
Hotel EBITDA Margin (%)	Q3 2025	—	35%–37%	New
RevPAR ($)	FY 2025	$142–$143	$142–$143	Maintained
RevPAR Growth (%)	FY 2025	0%–1%	0%–1%	Maintained
Total Hotel Revenue ($M)	FY 2025	$295–$298	$295–$297	Narrowed slightly (lower top end)
Adjusted EBITDA ($M)	FY 2025	$89–$93	$89–$93	Maintained
AFFO per diluted share ($)	FY 2025	$0.95–$1.03	$0.95–$1.03	Maintained
Hotel EBITDA Margin (%)	FY 2025	34%–35%	34%–35%	Maintained
Corporate cash admin ($M)	FY 2025	$11.7	$11.2	Lowered
Interest expense excl. fees ($M)	FY 2025	$23.9	$24.3	Slightly raised
Weighted avg shares/units (M)	FY 2025	51.6	51.4	Lowered
Dividend per common share ($)	Quarterly	$0.09 (declared Q1, paid Apr 15)	$0.09 (declared, paid Jul 15)	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024, Q1 2025)	Current Period (Q2 2025)	Trend
Silicon Valley tech demand/AI tailwinds	Q4: SV RevPAR +14%; Bellevue +9%; optimism on AI/chip manufacturing	SV RevPAR +3%; all four hotels reached 80% occupancy; demand supported by Applied Materials expansion and NVIDIA Innovation Center	Strengthening occupancy; steady pricing; continued demand catalysts
Macro/tariffs/government	Q1: Initial tariff policies and government spending cuts in March impacted RevPAR trajectory; April holiday timing hit business travel	Signs of improving business travel in late Q3/Q4; government travel rebounded after Liberation Day	Macro headwinds moderating; government demand normalizing
Leisure markets	Q4: Leisure modest positive despite industry drag	Leisure hotels +4% RevPAR ex-Portsmouth; FL +2%; Anaheim +3%; Pittsburgh +23% on events (US Open, concerts)	Improving leisure in select markets; event-driven upside
Conventions/regional headwinds	Q4: Dallas impacted by convention center renovation	Dallas -9% RevPAR; Courtyard Dallas Downtown -17%; San Diego’s 2025 convention calendar down vs 2024	Persistent convention-related headwinds
Cost structure/labor	Q4: wage pressures moderating; GOP +150 bps	GOP +30 bps YoY; ~7% reduction in labor/benefits per occupied room; ~$0.8M workers’ comp refund; booking commissions +15% impacting ~30 bps	Structural cost improvements with some commission mix pressure
Capital allocation	Q4: asset sales planned; deleveraging	Five hotels sold ($83M); buyback initiated ($25M authorization; 20,480 shares at $7.02); recast credit facility planned	Active recycling, repurchases; balance sheet strengthening

Management Commentary

“After a weak April, our RevPAR turned positive in May and June... delivered adjusted FFO per share at the top of our guidance range” — Jeffrey H. Fisher, CEO .
“We beat industry performance again in the second quarter, and our streak grows to three and a half years… second quarter occupancy of 82 percent... matches a post-pandemic high” — Dennis Craven, COO .
“We sold five hotels... at an approximate 6% capitalization rate on 2024 NOI... approved a $25,000,000 share buyback plan... leverage to now only 21%... intend to launch an upsized and recast syndication of our credit facility and term loan” — Jeffrey H. Fisher, CEO .
“GOP margin... up 30 basis points... benefit of approximately $1,300,000 of workers' compensation, insurance and tax refunds” — Jeremy Wegner, CFO .

Q&A Highlights

Asset recycling: Two additional hotels listed for sale; one similar lower-RevPAR, lower CapEx profile; the other opportunistic to minimize upcoming CapEx; more detail expected next quarter .
Development timeline (Home2 Portland): 21–24 month construction timeline; aiming to start within ~six months pending site work/soils .
Acquisitions and buybacks: Bid-ask remains wide; management likely to “ramp” buybacks given stock price; opportunistic acquisition underwriting ongoing .

Estimates Context

Metric	Consensus (S&P Global)	Actual (S&P Global)	Result
Primary EPS (Q2 2025)	$0.06	$0.07	Bold beat
Revenue ($USD) (Q2 2025)	$79.6705M	$80.045M	Bold beat
EBITDA ($USD) (Q2 2025)	$27.6625M	$26.849M	Bold miss

Values retrieved from S&P Global.*
Note: Company-reported Adjusted EBITDA was $28.515M; S&P Global EBITDA comparisons reflect EBITDA, not Adjusted EBITDA .

Key Takeaways for Investors

Mix-driven resilience: Despite flat-to-down RevPAR (-0.4% YoY), CLDT held margins and delivered AFFO/share at the top of guidance, aided by labor/benefit efficiencies and refunds; continued Silicon Valley strength provides secular demand tailwinds .
Estimate dynamics: EPS and revenue were modest beats, while EBITDA missed on S&P Global basis, reflecting different definitions versus company Adjusted EBITDA; monitor sell-side adjustments post-print (EPS +$0.01 vs consensus; EBITDA -$0.8M vs consensus) [GetEstimates]*.
Capital recycling enhances portfolio quality and balance sheet: $83M proceeds from five low-RevPAR asset sales, leverage down to ~21%, with a plan to recast credit facilities to reduce interest costs; supports capacity for acquisitions and repurchases .
Buyback as near-term support: $25M authorization initiated with initial purchases; CFO/CEO indicated potential acceleration in Q3 given valuation—an incremental support to per-share metrics and stock sentiment .
Regional dispersion matters: Convention-related weakness (Dallas, San Diego remainder of 2025) offsets leisure/event-led markets (Pittsburgh +23%); focus on markets with AI/tech adjacency (Sunnyvale/SV) where occupancy reached 80% and catalysts are visible (Applied Materials, NVIDIA) .
Cost vigilance: Commission costs rose ~15% (≈30 bps margin impact); continued productivity monitoring remains key to sustaining GOP/Hotel EBITDA margins amid mixed demand .
Guidance consistency: FY 2025 RevPAR and profitability ranges largely maintained with minor tweaks (lower corporate cash admin, slightly higher interest expense); Q3 guide frames a soft start but improving business travel into late Q3/Q4 .

Appendix: Additional Data Points

Month-by-Month (Comparable Portfolio)

Month	Occupancy (%)	ADR ($)	RevPAR ($)	YoY RevPAR Change
April	80%	$182	$146	-4%
May	81%	$191	$156	+2%
June	83%	$198	$164	+1%
July (early)	80%	$196	$156	-2%

Balance Sheet and Capital Structure (as of June 30, 2025)

Net debt $336M; total debt $353M; average interest rate 6.5%; leverage ratio ~21% (net debt to hotel investments cost) .
Debt mix: $143M fixed-rate mortgages (7.2%), $140M term loan (5.9%), $70M drawn on $260M revolver (6.0%) .

Footnotes:
*Values retrieved from S&P Global (Estimates and related “actual” fields).

Chatham Lodging Trust (CLDT)·Q2 2025 Earnings Summary