Core Points - Marriott Vacations Worldwide Corporation (NYSE: VAC) will report its financial results for the third quarter of 2025 on November 5 after market close [1] - A conference call to discuss the results will take place at 8:30 a.m. ET on November 6 [1] - Participants can access the call by dialing (877) 407-8289 for domestic calls or (201) 689-8341 for international callers [1] - A live webcast of the call will be available in the Investor Relations section of the Company's website [1]

Core Insights - Shares of Marriott Vacations Worldwide (NYSE: VAC) have underperformed over the past year, losing approximately 5% of their value due to a slower-than-expected turnaround [1] Company Performance - The turnaround process for Marriott Vacations Worldwide has taken longer than anticipated, contributing to the decline in share value [1] Analyst Perspective - The analysis reflects a contrarian investment approach based on macroeconomic views and specific stock turnaround stories aimed at achieving outsized returns with a favorable risk/reward profile [1]

Core Viewpoint - Vishay Intertechnology, Inc. has launched a new series of Automotive Grade AC line rated ceramic disc safety capacitors, which are the first in the industry to feature a Y1 rating in a surface-mount casing, designed for EMI/RFI suppression in harsh environments [1][2]. Product Features - The SMDY1 Automotive Series capacitors have a Y1 rating of 500 VAC and 1500 VDC, with capacitance up to 4.7 nF, making them suitable for applications in electric vehicles (EV), hybrid electric vehicles (HEV), and plug-in hybrid electric vehicles (PHEV) [1][2]. - These capacitors are AEC-Q200 qualified and have a Class IIB humidity grade, capable of withstanding the 85/85/1000 h test, ensuring high humidity resistance [2]. - The capacitors allow for surface-mount assembly with a reflow soldering process, which reduces production costs and enables a low, flat profile on the PCB [3]. Compliance and Specifications - The components are RoHS-compliant and halogen-free, made from a copper-plated ceramic disc with flame-resistant epoxy resin encapsulation in accordance with UL 94 V-0 [4]. - The SMDY1 Automotive Series is available in two case sizes: C case with a creepage distance of 10 mm and D case with a creepage distance of 14.5 mm [4]. - Specifications include a ceramic class of 2, a dielectric of Y5U, a minimum capacitance of 470 pF, a maximum capacitance of 4700 pF, and a capacitance tolerance of ±20% [5]. Availability - Samples and production quantities of the SMDY1 Automotive Series are currently available, with lead times of 12 weeks [5]. Company Overview - Vishay Intertechnology, Inc. is a leading manufacturer of discrete semiconductors and passive electronic components, serving various markets including automotive, industrial, computing, and telecommunications [6].

Core Viewpoint - Marriott Vacations Worldwide reported strong Q2 2025 earnings, exceeding estimates and showing year-over-year growth, driven by increased Vacation Ownership sales and digital initiatives [3][5][10]. Financial Performance - Adjusted earnings per share (EPS) for Q2 2025 were $1.96, surpassing the Zacks Consensus Estimate of $1.72 by 14%, and up from $1.10 in the same quarter last year [5]. - Quarterly revenues reached $1.25 billion, exceeding the consensus mark of $1.22 billion by 1.9% and reflecting a 9% year-over-year increase [5]. - Adjusted EBITDA increased by 29% year over year to $203 million, with a margin of 24.3%, up from 20.7% a year ago [8]. Segment Highlights - Vacation Ownership segment revenue rose 12% year over year to $775 million, with adjusted EBITDA increasing 28% to $231 million [6]. - Exchange & Third-Party Management revenue declined 10% year over year to $51 million, with adjusted EBITDA falling 7% to $23 million [7]. Balance Sheet & Liquidity - The company ended Q2 with $799 million in liquidity, including $205 million in cash and equivalents, and $539 million in available credit [9]. - Total inventory was valued at $1 billion, with corporate debt at $3 billion and non-recourse securitized debt at $2 billion [9]. 2025 Outlook - Marriott Vacations reaffirmed its 2025 guidance, expecting contract sales between $1.74 billion and $1.83 billion, adjusted EBITDA of $750 million to $780 million, and adjusted EPS of $6.40 to $7.10 [10]. - The company anticipates $150 million to $200 million in EBITDA benefits from its modernization program by 2026, with projected free cash flow of $270 million to $330 million for 2025 [10]. Industry Context - Marriott Vacations Worldwide operates within the Zacks Leisure and Recreation Services industry, where competitor Royal Caribbean reported a 10.4% year-over-year revenue increase to $4.54 billion [14][15].

Financial Performance - Total revenues for the three months ended June 30, 2025, were $1,246 million, a 9.3% increase from $1,140 million in the same period of 2024[177]. - Net income attributable to common stockholders for the three months ended June 30, 2025, was $69 million, compared to $37 million for the same period in 2024, representing an increase of 86.5%[177]. - Total revenues for the first half of 2025 reached $2,323 million, compared to $2,208 million in the first half of 2024, marking a 5% increase[197]. - Revenues for the six months ended June 30, 2025, reached $2,446 million, while expenses totaled $2,250 million, resulting in a net income of $126 million[269]. - The company reported a net income attributable to common stockholders of $125 million for the six months ended June 30, 2025[269]. Vacation Ownership Segment - The Vacation Ownership segment generated $370 million in sales of vacation ownership products for the three months ended June 30, 2025, up from $309 million in the same period of 2024, reflecting a 19.7% increase[177]. - Vacation Ownership revenues increased by $110 million (10%) to $1,188 million for the three months ended June 30, 2025, compared to $1,078 million in 2024[179]. - Sale of vacation ownership products increased to $370 million in Q2 2025, up 20% from $309 million in Q2 2024[198]. - Segment Adjusted EBITDA for Vacation Ownership increased by $50 million (28%) to $231 million for the three months ended June 30, 2025, compared to $181 million in 2024[190]. - The adjusted EBITDA margin for the Vacation Ownership segment improved to 29.8% in Q2 2025, up 3.8 percentage points from 26.0% in Q2 2024[197]. Expenses and Costs - The company incurred total expenses of $1,134 million for the three months ended June 30, 2025, compared to $1,038 million in the same period of 2024, representing an increase of 9.2%[177]. - General and administrative expenses increased by $7 million, or 12%, to $61 million for the three months ended June 30, 2025, compared to $54 million in the same period of 2024[227]. - Non-recurring cash costs related to modernization initiatives are expected to be approximately $100 million in each of 2025 and 2026[172]. Financing and Debt - Financing revenue for the three months ended June 30, 2025, was $90 million, compared to $85 million in the same period of 2024, indicating a 5.9% increase[177]. - The corporate debt to Adjusted EBITDA ratio was 3.9 as of June 30, 2025, exceeding the targeted range of 2.5 to 3.0, indicating a need for focus on debt reduction[248]. - Securitized debt totals $2,859 million, with payments due in 2025 estimated at $146 million[265]. - The average interest rate for securitized debt is 4.8%, with total expected principal payments amounting to approximately $2.2 billion[275]. Member Engagement - Total active members in the Interval Network at the end of the applicable period is considered an important metric for evaluating engagement[176]. - Total active members at the end of the period decreased by 23, or 2%, to 1,507 compared to 1,530 in the previous year[178]. - Average revenue per member decreased by $0.90 (2%) to $37.40 for the three months ended June 30, 2025, compared to $38.30 in 2024[178]. Strategic Initiatives - The company expects to drive $150 million to $200 million of annualized benefits from its Strategic Business Operations initiatives by the end of 2026, with approximately half from cost savings and efficiencies[172]. - The company anticipates inventory spending in 2025 to be impacted by inventory repurchases and timing of payments for inventory[160]. Tax and Restructuring - The effective tax rate for the three months ended June 30, 2025, was 26.8%, compared to 22.0% for the same period in 2024[240]. - The company recorded $2 million in restructuring charges during the first half of 2025, compared to $1 million in the same period of 2024[232]. - The company incurred $32 million in restructuring charges during the second quarter of 2025, primarily related to advisory services[234]. Currency and Foreign Operations - Gains from foreign currency translation amounted to $18 million in the second quarter of 2025, compared to losses of $4 million in the same quarter of 2024[237]. Shareholder Returns - Cash dividends of $0.79 per share were distributed to common stockholders in the first half of 2025, with expectations for future quarterly dividends subject to Board approval[264]. - The company repurchased 496,484 shares at an average price of $73.10 during the first half of 2025, bringing total repurchased shares to 26,287,034[263].

Core Viewpoint - Marriott Vacations Worldwide Corporation held its Q2 2025 earnings call, discussing financial performance and future outlook [1][2][3]. Group 1: Company Overview - The earnings call featured key executives including John Geller, the President and CEO, and Jason Marino, the Executive VP and CFO [3][5]. - The call was hosted by Neal Goldner, Vice President of Investor Relations, indicating a structured approach to investor communication [2][3]. Group 2: Financial Information - The company emphasized that many comments made during the call are forward-looking statements, which are subject to risks and uncertainties [4]. - References to non-GAAP financial information were made, with reconciliations available in the press release and on the company's website [4].

Financial Data and Key Metrics Changes - Adjusted EBITDA for the quarter was $203 million, reflecting a 29% increase year-over-year with margins improving by 360 basis points [5][18] - Contract sales were down less than 1% for the quarter, showing improvement compared to Q1, with first-time buyer sales up 6% [7][16] - Total company rental profit declined by $7 million or 16% to $35 million, driven by increased unsold maintenance fees and marketing expenses [17] Business Line Data and Key Metrics Changes - Owner sales declined by 4% year-over-year due to lower VPGs, while owner tours remained flat [16] - Management exchange profit increased by 3% to $98 million, attributed to increased revenue in the vacation ownership segment [17] - Financing profit increased by 7% to $53 million [17] Market Data and Key Metrics Changes - Resort occupancy was nearly 90%, with strong performance in Maui, Coastal Florida, and The Caribbean, while Las Vegas showed relative weakness [6] - First-time buyers represented one-third of total contract sales, up 200 basis points from a year ago [8] Company Strategy and Development Direction - The company is focused solely on the upper upscale segment of the vacation ownership market, targeting owners with a median annual income of $150,000 [6] - A modernization initiative is expected to deliver $150 million to $200 million in run-rate benefits by 2026, with half from revenue initiatives and half from cost savings [7][11] - The company aims to grow tours and VPG in the low single digits and leverage fixed costs to improve margins [14] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business model and the continued prioritization of leisure travel by consumers [5][13] - Loan delinquencies are trending down, with the lowest levels in two years, and management expects maintenance fees to remain flattish next year [12][19] - Despite macroeconomic uncertainties, management remains optimistic about long-term growth potential [14][42] Other Important Information - The company ended the quarter with leverage of 3.9 times and $800 million in liquidity [18] - Adjusted free cash flow is expected to be between $270 million and $330 million for the year, excluding one-time cash costs related to modernization initiatives [20] - The company acquired 52 completed timeshare units in Cowalack, Thailand for $43 million during the quarter [20] Q&A Session Summary Question: Contract sales performance in June and July - Management confirmed that July contract sales were up slightly from June, with June showing a 3% year-over-year increase [26][27] Question: Loan loss provision expectations - The loan loss provision is expected to be 12.5%, which is about half a point higher than previous guidance, reflecting ongoing improvements in delinquencies [28][30] Question: Expanded owner benefits and EBITDA impact - The expanded owner benefit provides more options for owners but is not expected to significantly impact EBITDA growth [35][36] Question: Share buyback restrictions - Management indicated that there were blackout periods that precluded share buybacks, but they plan to be opportunistic in the future [39] Question: Inventory efficiency and cost implications - Management aims to reduce inventory levels to one to two years on hand, with a slight increase in product costs expected over the next few years [48][49] Question: Recovery in Maui post-wildfire - Maui showed strong year-over-year contract sales, with transient occupancies and rates up, although sales remained flat compared to last year [62]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $203 million for the quarter, reflecting a 29% increase year-over-year with margins improving by 360 basis points [4][18] - Contract sales were down less than 1% for the quarter, an improvement compared to Q1, with first-time buyer sales up 6% year-over-year [6][15] - Delinquencies declined by 50 basis points sequentially and 110 basis points year-over-year, reaching the lowest levels in two years [15][29] Business Line Data and Key Metrics Changes - Owner sales declined by 4% due to lower VPGs, while owner tours remained flat [15] - Total company rental profit decreased by $7 million or 16% to $35 million, driven by increased unsold maintenance fees and marketing expenses [17] - Management exchange profit increased by 3% to $98 million, attributed to increased revenue in the vacation ownership segment [17] Market Data and Key Metrics Changes - The company achieved nearly 90% resort occupancy, with strong performance in Maui, Coastal Florida, and The Caribbean, while Las Vegas showed relative weakness [5] - First-time buyers represented a third of total contract sales in the quarter, up 200 basis points from a year ago [7] Company Strategy and Development Direction - The company is focused on modernization initiatives expected to deliver $150 million to $200 million in run rate benefits by the end of 2026, with half from revenue initiatives and half from cost savings [6][11] - The modernization program aims to enhance decision-making speed, optimize IT platforms, and drive growth in the leisure-focused business [7][12] - The company plans to restrict inventory spending to low-cost reacquired inventory and capital-efficient arrangements [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business model and the continued prioritization of leisure travel by consumers [4][13] - Despite external uncertainties, the company expects high occupancy rates to continue and anticipates strong owner keys for the second half of the year [12][14] - The long-term financial model remains unchanged, with expectations for high single-digit to low double-digit EPS growth over time [14] Other Important Information - The company ended the quarter with $800 million in liquidity and a leverage ratio of 3.9 times [18] - Adjusted free cash flow is expected to be between $270 million and $330 million for the year, excluding one-time cash costs related to modernization initiatives [20] Q&A Session Summary Question: Contract sales trends in June and July - Management confirmed that July contract sales were up slightly from June, with June showing a 3% year-over-year increase [26][27] Question: Loan loss provision expectations - The loan loss provision guidance increased to 12.5%, which is about half a point higher than previous expectations, reflecting ongoing improvements in delinquencies [28][29] Question: Expanded owner benefits and EBITDA impact - The expanded owner benefit provides more options for owners but is not expected to significantly impact EBITDA growth [33][34] Question: Share buyback restrictions - Management indicated that there were blackout periods preventing share buybacks, but they plan to be opportunistic in the future [36][37] Question: Inventory efficiency and cost implications - The company aims to reduce inventory levels to one to two years on hand, with a slight increase in product costs expected over the next few years [45][46] Question: Loan loss provision increase despite improving delinquencies - Management explained that while delinquencies are improving, they are still higher than desired, prompting a conservative approach to the loan loss provision [53][54] Question: Sales performance in Maui - Maui showed strong year-over-year performance, with contract sales and occupancy rates improving, although some challenges remain [59]

Business Overview - The company operates with iconic brands, approximately 120 resorts, and serves around 700,000 owner families[9] - The company's business model includes timeshare and exchange products, multiple brands, perpetual sales centers, points-based offerings, and a capital-efficient development model[11] - Approximately 40% of the company's Adjusted EBITDA contribution comes from recurring sources[13, 77] Financial Performance and Projections - Exchange and Third-Party Management contribute approximately 10% to Adjusted EBITDA, while Vacation Ownership contributes approximately 90%[9] - The Exchange and Third-Party Management segment has a high Adjusted EBITDA margin of approximately 46%[20] - The company anticipates $150 million to $200 million in annualized Adjusted EBITDA benefits by 2026 from strategic modernization initiatives[27, 77] - Full year 2025 guidance includes contract sales of $1740 million to $1830 million and Adjusted EBITDA of $750 million to $780 million[72] - The company projects Adjusted Free Cash Flow for 2025 to be between $270 million and $330 million[72] Growth Strategies - The company is focused on driving growth through product transformation, leveraging technology, and disciplined use of free cash flow[37] - Approximately 49% of 2024 tour packages were sold digitally, and 14% of 2024 contract sales were sold non-traditionally, including virtual sales[51] - The company has added approximately 100,000 first-time buyers since 2020[59]

Core Insights - Marriott Vacations Worldwide reported $1.25 billion in revenue for the quarter ended June 2025, marking a year-over-year increase of 9.3% and an EPS of $1.96 compared to $1.10 a year ago, with revenue exceeding Zacks Consensus Estimate by 1.85% [1] - The company’s EPS also surpassed the consensus estimate of $1.72 by 13.95% [1] Revenue Breakdown - Cost reimbursements revenue was $407 million, exceeding the average estimate of $391.55 million by analysts, representing a year-over-year change of +7.7% [4] - Rental revenue reached $160 million, slightly above the average estimate of $157.54 million, with a year-over-year increase of +4.6% [4] - Management and exchange revenue was reported at $219 million, in line with the average estimate of $218.79 million, reflecting a +1.9% year-over-year change [4] - Sales of vacation ownership products generated $370 million, surpassing the estimated $360.33 million, with a significant year-over-year increase of +19.7% [4] - Financing revenue amounted to $90 million, exceeding the average estimate of $88.4 million, with a year-over-year change of +5.9% [4] Stock Performance - Shares of Marriott Vacations Worldwide have returned -8.3% over the past month, contrasting with the Zacks S&P 500 composite's +0.6% change, indicating underperformance relative to the broader market [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the market in the near term [3]