Executive Summary

Soft quarter with top-line in line but earnings below expectations: Q3 revenue $610M vs S&P Global consensus $609M; GAAP diluted EPS $(0.08) vs consensus ≈ $0.01; Adjusted FFO/share $0.35 vs FFO/share consensus ≈ $0.38. Comparable RevPAR fell 6.1% YoY (−4.9% ex-Royal Palm closure) amid weaker leisure/government transient and tough group comps . S&P Global values marked with an asterisk; see disclaimer below. *
Mix and markets: Strength in San Francisco (JW Marriott +13.5% RevPAR), New York (+3.9%), Puerto Rico (+11.7%), and Orlando (+1.9%) partially offset Hawaii (−11.6%), Southern California (−10.9%), Washington D.C. (−16.1%), and New Orleans (−15.2%) .
Guidance trimmed: Full‑year 2025 midpoint lowered—Comparable RevPAR change vs 2024 cut ~110 bps; Adjusted EBITDA down by ~$13M to $607.5M midpoint; Adjusted FFO/share midpoint to $1.91. Management cites October government shutdown (≈$2.5M room revenue, ~180 bps October RevPAR drag) and softer leisure as drivers .
Balance sheet/liquidity as key support/catalyst: Liquidity increased to ~$2.1B with revolver upsized to $1B (to 2029) and new $800M delayed draw term loan (to 2030); plan to address 2026 Boston and Hawaiian Village maturities; Q4 group revenue pace up >12% YoY provides near‑term setup, with events and easier Hawaii comps into Q4/Q26 .

What Went Well and What Went Wrong

What Went Well

Portfolio outperformance in select markets: San Francisco (RevPAR +13.5%), New York (+3.9%), Puerto Rico (+11.7%), Orlando (+1.9%) demonstrated resilience and share gains despite macro headwinds .
Cost discipline contained expense growth: Comparable hotel total expense growth limited to ~10 bps; management highlighted deep dives in productivity, staffing, procurement, insurance renewals (−25%), and tax appeals as levers sustaining margins despite lower RevPAR .
Liquidity and refinancing visibility: $2.1B liquidity; revolver upsized/extended; $800M delayed draw term loan provides line of sight to repay 2026 Boston ($122M) and Hawaiian Village ($1.275B) maturities with additional financing planned H1’26 .

“During the third quarter, we remained laser-focused on our strategic objective to preserve a strong and flexible balance sheet. We significantly increased our liquidity to $2.1 billion to address maturing loans.” — CEO Tom Baltimore .

What Went Wrong

Top-line softness and earnings miss: Comparable RevPAR −6.1% YoY (−4.9% ex-Royal Palm); diluted EPS $(0.08) vs S&P consensus ≈ $0.01; Adjusted FFO/share $0.35 vs ≈ $0.38; Adjusted EBITDA $130M, pressured by lower volumes and mix .*
Macro/government headwinds: October government shutdown impacted both group and transient demand (notably HI, DC, SoCal), ~180 bps RevPAR drag in October; October RevPAR near flat YoY (ex‑Royal Palm +~1.5%) .
Hawaii and renovation disruptions: Hawaii RevPAR −11.6% YoY with occupancy −560 bps; second‑phase renovations (Waikoloa/HHV) and Royal Palm (Miami) closure weighed; management expects continued ramp in 2026 as projects complete and strike comps lap .

Financial Results

Multi-period actuals

Metric	Q1 2025	Q2 2025	Q3 2025
Total Revenues ($M)	$630	$672	$610
(Loss) EPS – Diluted	$(0.29)	$(0.02)	$(0.08)
Adjusted FFO/share – Diluted	$0.46	$0.64	$0.35
Adjusted EBITDA ($M)	$144	$183	$130
Operating Income Margin	1.1%	9.6%	9.7%
Comparable RevPAR ($)	$177.67	$195.68	$180.93
Comparable Occupancy	69.2%	76.5%	74.7%
Comparable ADR ($)	$256.62	$255.76	$242.25
Comparable Hotel Adj. EBITDA Margin	24.9%	29.6%	24.1%

Q3 2025 actual vs S&P Global consensus

Metric	Consensus	Actual
Total Revenues ($M)	608.77*	610
Primary EPS	0.0061*	(0.08)
FFO / Share (REIT)	0.384*	0.35
EBITDA ($M)	134.83*	138 EBITDA / 130 Adjusted EBITDA

Asterisk indicates values retrieved from S&P Global. Actual EBITDA per company’s non‑GAAP reconciliation was $138M EBITDA and $130M Adjusted EBITDA . S&P Global consensus/actual methodologies may differ from company definitions.*

Market/segment snapshot (Q3 2025 vs Q3 2024)

Market	ADR ($) YoY	Occ. YoY (pp)	RevPAR YoY
Hawaii	(5.6%)	−5.6	(11.6%)
Orlando	+3.0%	−0.7	+1.9%
New York	+5.2%	−1.1	+3.9%
San Francisco	+8.5%	+3.2	+13.5%
Washington, D.C.	(0.1%)	−12.0	(16.1%)
Puerto Rico	(9.0%)	+15.5	+11.7%

KPIs indicate mixed performance, with urban recovery in SF/NY and resort strength in PR/Orlando offset by Hawaii/DC softness .

Non‑GAAP notes: Q3 included $16M interest expense associated with hotels in receivership, offset by gain on derecognition in non‑GAAP reconciliations .

Guidance Changes

Metric	Period	Previous (Jul 31, 2025)	Current (Oct 30, 2025)	Change
Comparable RevPAR change vs 2024	FY 2025	−2.0% to 0.0%	−2.5% to −1.8%	Lowered ~110 bps midpoint
Comparable RevPAR ex‑Royal Palm vs 2024	FY 2025	−1.0% to +1.0%	−1.5% to −0.7%	Lowered ~110 bps midpoint
Adjusted EBITDA ($M)	FY 2025	595 to 645	595 to 620	−$13M at midpoint
Operating Income Margin	FY 2025	8.4% to 10.2%	8.2% to 9.1%	Down ~70 bps midpoint
Comparable Hotel Adj. EBITDA Margin	FY 2025	26.1% to 27.5%	26.3% to 26.9%	+20 bps midpoint (mix/costs)
Adjusted FFO/share – Diluted	FY 2025	$1.82 to $2.08	$1.85 to $1.97	Slightly mixed (range narrowed)
Net Loss attributable to stockholders ($M)	FY 2025	(60) to (10)	(66) to (41)	Widened loss
Dividend	Q4 2025	—	$0.25 declared; no top‑off expected	Maintained base dividend

Management cited the October government shutdown, softer leisure, and renovation/closure impacts as reasons for adjustments .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1–Q2 2025)	Current Period (Q3 2025)	Trend
Group demand/pacing	Q1: 2025 group pace +>1%; Key West/Orlando outperformance . Q2: Q4 2025 group pace projected +18% .	Q4 2025 group revenue pace +>12%; strongest in Bonnet Creek, SF, NY, Denver, HI, PR .	Improving into Q4
Leisure/government transient	Q2: Strong resorts offset Hawaii softness .	Softer leisure and government transient; October shutdown ~180 bps Oct RevPAR drag .	Worsened near term
Hawaii trajectory	Q1–Q2: Strike in late 2024; phase 2 renovations to start Aug .	Q3 HI RevPAR −11.6% YoY; expect 2026 ramp as renovations complete/strike laps; Japan inbound still below 2019 .	Recovery delayed; 2026 ramp
Capital allocation/ROI	Ongoing reinvestment; Royal Palm $103M, 15–20% ROI .	$220–$300M 2025 capex; Royal Palm on track; focus on core 20 assets; exit non‑core/ground leases .	Continued
Liquidity/refi	Liquidity ~$1.2–$1.3B in Q1/Q2 .	Liquidity ~$2.1B; revolver to $1B (2029), $800M delayed draw term loan (2030) to address 2026 maturities .	Stronger
San Francisco hotels	In receivership since 2023 .	Expect sale by receiver on/before Nov 21, 2025; buyer to assume $725M CMBS .	Resolution near
Dividends	Base $0.25/quarter .	Q4 $0.25; no 2025 “top‑off” to preserve liquidity for investments/deleveraging .	Preservation bias

Management Commentary

Strategic focus and liquidity: “We successfully extended and upsized our corporate credit facility… increases our total liquidity to $2.1 billion to address our 2026 debt maturities.”
ROI projects: “$103 million renovation and repositioning of the Royal Palm… expected to generate a 15% to 20% IRR and more than double the hotel’s EBITDA from $14 million to nearly $28 million upon stabilization… targeting a reopening ahead of the 2026 World Cup” .
Cost controls: “Third consecutive quarter with expense growth of 1% or less… deep dives… productivity, staffing, procurement… insurance premiums down 25%” .
Near-term outlook: “Group revenue pace for the fourth quarter is currently up over 12% year-over-year… but the extended government shutdown has impacted both group and transient demand” .
Dividends/capital allocation: “We do not expect to declare a top-off dividend for 2025… preserving over $50 million… to reinvest in the portfolio and deleverage the balance sheet” .

Q&A Highlights

Expense management sustainability: Management detailed property “deep dives,” brand standard challenges, insurance/tax savings, and expects expense growth to be ~0% in Q4 as occupancy flexing continues .
Guidance and government shutdown: The updated range reflects shutdown impact through October; lower end of guidance intended to cover extension risk; October room revenue impact ~ $2.5M .
Hawaii outlook: Japan inbound still ~50% of 2019; renovations (Rainbow/Palace towers) causing disruption; expect continued ramp into 2026/2027 despite near-term softness .
Q4 deceleration drivers vs prior view: General transient softness (~150 bps), government (~100 bps), Waikoloa renovation (~50 bps), Chicago transient (National Guard deployment, ~50 bps); group remains strong .
Asset sales and use of proceeds: 15 non-core assets remain; two under LOI; priority to delever and reinvest; opportunistic buybacks considered but secondary to debt reduction .

Estimates Context

Q3 actual vs S&P Global consensus: Revenue $610M vs $608.77M* (in line); Primary EPS $(0.08) vs ≈ $0.006* (miss); FFO/share $0.35 vs ≈ $0.384* (miss). Number of estimates: revenue (11), EPS (5) [GetEstimates]. Actuals reconcile with company-reported results above .*
Implications: Street models likely trim FY Adjusted EBITDA/FFO given lower Q3 flow-through and softer Q4 setup; company narrowed and lowered FY ranges accordingly .*

Asterisk indicates values retrieved from S&P Global.

Key Takeaways for Investors

2025 reset/lower bar: FY midpoint cuts reflect softer leisure/government and renovation drag; Q4 group strength and easier Hawaii comps mitigate but not fully offset near-term pressure .
Liquidity/debt maturities de-risked: $2.1B liquidity and terming out corporate facilities support upcoming 2026 mortgage maturities; reduces refinancing overhang into 2026 .
Portfolio quality skew: Outperformance in SF/NY/Orlando/PR confirms strategy to focus on ~20 core assets; exit of low-EBITDA/ground-lease hotels to lift RevPAR and margins over time .
Watch Hawaii recovery cadence: Renovation completion and strike laps are 2026 earnings catalysts; Japan inbound and macro rate backdrop are swing factors .
Dividend stable but no top-off: Base $0.25/quarter maintained; capital prioritized to ROI and deleveraging—positive for NAV compounding despite headline yield .
Near-term trading catalysts: Resolution of SF receivership sale (target by Nov 21), government shutdown developments, Q4 group execution, and any additional non-core dispositions .
Medium-term thesis: Low industry supply growth and event tailwinds (World Cup, Super Bowl, anniversary events) plus ROI projects set up 2026–27 RevPAR and margin expansion—leverage and asset sales are key to multiple re‑rating .

Sourcing and additional data:

Q3 2025 8‑K/press release, supplemental, and guidance: .
Q3 2025 earnings call transcript (prepared remarks and Q&A): .
Prior quarters for trend analysis: Q2 2025 press release ; Q1 2025 press release .
S&P Global consensus and estimate counts via GetEstimates (Revenue, EPS, EBITDA, FFO/share): values marked with asterisk; “Values retrieved from S&P Global.”*

Park Hotels & Resorts Inc. (PK)·Q3 2025 Earnings Summary