Host Hotels & Resorts(HST) - 2025 Q2 - Quarterly Report

Explanatory Note This section clarifies the combined quarterly filings of Host Inc. (REIT) and Host L.P., with equity being the primary financial statement difference - The report combines quarterly filings for Host Hotels & Resorts, Inc. (REIT) and Host Hotels & Resorts, L.P. (limited partnership)[10] - Host Inc. is the sole general partner of Host L.P. and holds approximately 99% of its partnership interests[11] - The financial statements of Host Inc. and Host L.P. are substantially similar, differing primarily in the equity (or partners' capital) section[12] PART I. FINANCIAL INFORMATION This part presents the unaudited condensed consolidated financial statements and management's discussion and analysis Item 1. Financial Statements for Host Hotels & Resorts, Inc. This section presents Host Inc.'s unaudited condensed consolidated financial statements, including balance sheets, operations, comprehensive income, and cash flows Condensed Consolidated Balance Sheets This section provides Host Inc.'s financial position, detailing assets, liabilities, and equity as of June 30, 2025, and December 31, 2024 | ASSETS | June 30, 2025 (unaudited) | December 31, 2024 | | :--------------------------------- | :------------------------ | :------------------ | | Property and equipment, net | $10,795 million | $10,906 million | | Total assets | $12,960 million | $13,048 million | | LIABILITIES, NON-CONTROLLING INTERESTS AND EQUITY | | | | Total debt | $5,077 million | $5,083 million | | Total liabilities | $6,183 million | $6,271 million | | Total equity | $6,641 million | $6,612 million | Condensed Consolidated Statements of Operations This section outlines Host Inc.'s financial performance, presenting revenues, expenses, and net income for specified periods | Metric | Quarter ended June 30, 2025 | Quarter ended June 30, 2024 | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :-------------------------------------- | :-------------------------- | :-------------------------- | :------------------------------- | :------------------------------- | | Total revenues | $1,586 million | $1,466 million | $3,180 million | $2,937 million | | Total operating costs and expenses | $1,309 million | $1,174 million | $2,618 million | $2,354 million | | OPERATING PROFIT | $277 million | $292 million | $562 million | $583 million | | NET INCOME | $225 million | $242 million | $476 million | $514 million | | NET INCOME ATTRIBUTABLE TO HOST HOTELS & RESORTS, INC. | $221 million | $239 million | $469 million | $507 million | | Basic earnings per common share | $0.32 | $0.34 | $0.68 | $0.72 | | Diluted earnings per common share | $0.32 | $0.34 | $0.67 | $0.72 | Condensed Consolidated Statements of Comprehensive Income This section details Host Inc.'s comprehensive income, including net income and other comprehensive income (loss), for specified periods | Metric | Quarter ended June 30, 2025 | Quarter ended June 30, 2024 | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :-------------------------------------- | :-------------------------- | :-------------------------- | :------------------------------- | :------------------------------- | | NET INCOME | $225 million | $242 million | $476 million | $514 million | | OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX | $5 million | $(5) million | $9 million | $(8) million | | COMPREHENSIVE INCOME | $230 million | $237 million | $485 million | $506 million | | COMPREHENSIVE INCOME ATTRIBUTABLE TO HOST HOTELS & RESORTS, INC. | $226 million | $234 million | $478 million | $499 million | Condensed Consolidated Statements of Cash Flows This section presents Host Inc.'s cash flow activities, categorized into operating, investing, and financing, for specified periods | Cash Flow Activity | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Net cash provided by operating activities | $749 million | $818 million | | Net cash used in investing activities | $(198) million | $(775) million | | Net cash used in financing activities | $(583) million | $(353) million | | NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | $(27) million | $(314) million | | CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | $771 million | $1,049 million | | Supplemental Cash Flow Information | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | | Total interest paid | $119 million | $91 million | | Income taxes paid | $7 million | $5 million | Item 1. Financial Statements for Host Hotels & Resorts, L.P. This section presents Host L.P.'s unaudited condensed consolidated financial statements, mirroring Host Inc.'s with equity/capital as the main distinction Condensed Consolidated Balance Sheets This section provides Host L.P.'s financial position, detailing assets, liabilities, and capital as of June 30, 2025, and December 31, 2024 | ASSETS | June 30, 2025 (unaudited) | December 31, 2024 | | :--------------------------------- | :------------------------ | :------------------ | | Property and equipment, net | $10,795 million | $10,906 million | | Total assets | $12,960 million | $13,048 million | | LIABILITIES, LIMITED PARTNERSHIP INTERESTS OF THIRD PARTIES AND CAPITAL | | | | Total debt | $5,077 million | $5,083 million | | Total liabilities | $6,183 million | $6,271 million | | Total capital | $6,641 million | $6,612 million | Condensed Consolidated Statements of Operations This section outlines Host L.P.'s financial performance, presenting revenues, expenses, and net income for specified periods | Metric | Quarter ended June 30, 2025 | Quarter ended June 30, 2024 | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :-------------------------------------- | :-------------------------- | :-------------------------- | :------------------------------- | :------------------------------- | | Total revenues | $1,586 million | $1,466 million | $3,180 million | $2,937 million | | Total operating costs and expenses | $1,309 million | $1,174 million | $2,618 million | $2,354 million | | OPERATING PROFIT | $277 million | $292 million | $562 million | $583 million | | NET INCOME | $225 million | $242 million | $476 million | $514 million | | NET INCOME ATTRIBUTABLE TO HOST HOTELS & RESORTS, L.P. | $225 million | $242 million | $476 million | $514 million | | Basic earnings per common unit | $0.33 | $0.35 | $0.69 | $0.73 | | Diluted earnings per common unit | $0.33 | $0.35 | $0.69 | $0.73 | Condensed Consolidated Statements of Comprehensive Income This section details Host L.P.'s comprehensive income, including net income and other comprehensive income (loss), for specified periods | Metric | Quarter ended June 30, 2025 | Quarter ended June 30, 2024 | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :-------------------------------------- | :-------------------------- | :-------------------------- | :------------------------------- | :------------------------------- | | NET INCOME | $225 million | $242 million | $476 million | $514 million | | OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX | $5 million | $(5) million | $9 million | $(8) million | | COMPREHENSIVE INCOME | $230 million | $237 million | $485 million | $506 million | | COMPREHENSIVE INCOME ATTRIBUTABLE TO HOST HOTELS & RESORTS, L.P. | $230 million | $237 million | $485 million | $506 million | Condensed Consolidated Statements of Cash Flows This section presents Host L.P.'s cash flow activities, categorized into operating, investing, and financing, for specified periods | Cash Flow Activity | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :---------------------------------- | :------------------------------- | :------------------------------- | | Net cash provided by operating activities | $749 million | $818 million | | Net cash used in investing activities | $(198) million | $(775) million | | Net cash used in financing activities | $(583) million | $(353) million | | NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | $(27) million | $(314) million | | CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD | $771 million | $1,049 million | | Supplemental Cash Flow Information | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | | Total interest paid | $119 million | $91 million | | Income taxes paid | $7 million | $5 million | Notes to Condensed Consolidated Financial Statements (Unaudited) This section provides detailed notes to the unaudited condensed consolidated financial statements, offering context on organization, policies, and key financial items 1. Organization This note describes the company's structure as a self-managed REIT operating through a limited partnership and details its hotel portfolio - Host Hotels & Resorts, Inc. operates as a self-managed and self-administered real estate investment trust (REIT) through Host Hotels & Resorts, L.P.[37] - As of June 30, 2025, Host Inc. holds approximately 99% of Host L.P.'s partnership interests[37] | Consolidated Portfolio Location | Hotels | | :------------------------------ | :----- | | United States | 75 | | Brazil | 3 | | Canada | 2 | | Total | 80 | 2. Summary of Significant Accounting Policies This note outlines key accounting principles and estimates used in preparing financial statements, including GAAP conformity and interim reporting - Financial statements are prepared in conformity with U.S. GAAP, with certain information condensed or omitted[39] - Management makes estimates and assumptions that affect reported amounts; actual results may differ[40] - Interim results are not necessarily indicative of full-year performance due to seasonal variations[41] - Five partnerships, including Host L.P., are considered variable interest entities (VIEs)[42] 3. Earnings Per Common Share (Unit) This note explains the calculation of basic and diluted earnings per common share (unit) for Host Inc. and Host L.P. - Basic EPS/EPU is calculated by dividing net income attributable to common stockholders/unitholders by the weighted average number of shares/units outstanding[43] - Diluted EPS/EPU includes the effect of potentially dilutive securities, such as shares granted under stock plans and convertible non-controlling interests[43] | Metric | Quarter ended June 30, 2025 | Quarter ended June 30, 2024 | Year-to-date ended June 30, 2025 | Year-to-date ended June 30, 2024 | | :-------------------------------------- | :-------------------------- | :-------------------------- | :------------------------------- | :------------------------------- | | Host Inc. Diluted earnings per common share | $0.32 | $0.34 | $0.67 | $0.72 | | Host L.P. Diluted earnings per common unit | $0.33 | $0.35 | $0.69 | $0.73 | 4. Revenue This note disaggregates total revenues by market location, highlighting significant contributions from key geographic areas - Revenues are disaggregated by market location, with Orlando, Florida Gulf Coast, San Diego, and New York being significant contributors[45] | Location (Top 4 by Q2 2025 Revenue) | Quarter ended June 30, 2025 (millions) | Quarter ended June 30, 2024 (millions) | | :---------------------------------- | :------------------------------------- | :------------------------------------- | | Orlando | $132 | $116 | | Florida Gulf Coast | $122 | $120 | | San Diego | $134 | $134 | | New York | $134 | $103 | 5. Property and Equipment This note provides a detailed breakdown of the company's property and equipment, net of accumulated depreciation and amortization | Property and Equipment (in millions) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Land and land improvements | $2,457 | $2,457 | | Buildings and leasehold improvements | $15,656 | $15,504 | | Furniture and equipment | $2,622 | $2,546 | | Construction in progress | $298 | $299 | | Less accumulated depreciation and amortization | $(10,238) | $(9,900) | | Total Property and equipment, net | $10,795 | $10,906 | 6. Debt This note details the company's debt structure, including available credit, recent senior note issuances, and redemptions - As of June 30, 2025, the company had $1.5 billion of available capacity under the revolver portion of its credit facility[47] - On May 20, 2025, the company issued $500 million of 5.7% Series M senior notes (due June 2032) for approximately $490 million net proceeds[48] - The proceeds from the Series M senior notes were used to redeem all $500 million of Series E senior notes due in June 2025[48] 7. Equity of Host Inc. and Capital of Host L.P. This note outlines changes in Host Inc.'s equity and Host L.P.'s capital, including share repurchases and dividend declarations - During Q2 2025, Host Inc. repurchased 6.7 million shares of common stock for $105 million at an average price of $15.56 per share[57] - Year-to-date June 30, 2025, Host Inc. repurchased 13.1 million shares for $205 million at an average price of $15.68 per share[57] - As of June 30, 2025, $480 million remained available under the common share repurchase program and $600 million of capacity remained under the 'at the market' distribution agreement (no shares issued in H1 2025)[57][58] - Host Inc.'s Board of Directors announced a regular quarterly cash dividend of $0.20 per share on June 12, 2025, paid on July 15, 2025[59] 8. Dispositions This note details the sale of The Westin Cincinnati, including the sale price and the resulting gain - During Q2 2025, The Westin Cincinnati was sold for $60 million, resulting in a gain on sale of $21 million[61] 9. Fair Value Measurements This note provides fair value measurements for various financial instruments, including senior notes, credit facilities, and mortgage debt | Financial Instrument (in millions) | Carrying Amount (June 30, 2025) | Fair Value (June 30, 2025) | Carrying Amount (Dec 31, 2024) | Fair Value (Dec 31, 2024) | | :--------------------------------- | :------------------------------ | :------------------------- | :----------------------------- | :------------------------ | | Senior notes (Level 1) | $3,987 | $3,911 | $3,993 | $3,838 | | Credit facility (Level 2) | $994 | $1,000 | $992 | $1,000 | | Mortgage debt (Level 2) | $96 | $91 | $98 | $91 | 10. Geographic and Business Segment Information This note clarifies the company's single reportable segment (hotel ownership) and disaggregates revenues and property by geographic area - The company operates as a single reportable segment: hotel ownership, with individual hotels considered operating segments[64] - The chief operating decision maker (CODM) uses Earnings Before Interest Expense, Income Taxes, Depreciation and Amortization (EBITDA) as the primary measure of performance for the reportable segment[65] | Geographic Area | Total Revenues (Q2 2025, millions) | Total Revenues (YTD 2025, millions) | Property and Equipment, net (June 30, 2025, millions) | | :---------------- | :--------------------------------- | :---------------------------------- | :---------------------------------------------------- | | United States | $1,557 | $3,133 | $10,733 | | Brazil | $7 | $14 | $30 | | Canada | $22 | $33 | $32 | | Total | $1,586 | $3,180 | $10,795 | 11. Non-controlling Interests This note describes the classification and valuation of non-controlling interests in Host L.P., including common OP units and their redemption value - Non-controlling interests of Host L.P. are classified as redeemable and valued at the greater of historical cost or redemption value[70] | Non-controlling Interests (in millions) | June 30, 2025 | December 31, 2024 | | :-------------------------------------- | :------------ | :---------------- | | Common OP units outstanding | 8.7 | 9.2 | | Market price per Host Inc. common share | $15.36 | $17.52 | | Redemption value | $136 | $165 | | Historical cost | $86 | $90 | | Book value recorded | $136 | $165 | 12. Contingencies This note discusses significant contingencies, including the reopening of The Don CeSar after hurricane damage and related insurance claims - The Don CeSar, affected by Hurricanes Helene and Milton in 2024, reopened to guests on March 26, 2025, as part of a phased reopening[74] - Estimated book value of property and equipment written off and remediation costs at The Don CeSar is approximately $60 million, with a corresponding $60 million insurance receivable[75] - As of June 30, 2025, $29 million in insurance proceeds were received for these claims, including $19 million recognized as a gain on business interruption[75] 13. Legal Proceedings This note confirms the company's involvement in routine legal proceedings and assesses the immateriality of current accruals for these claims - The company is involved in various legal proceedings in the ordinary course of business, but current accruals for these claims are immaterial[76][77] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on financial performance, condition, and future outlook, including non-GAAP reconciliations Forward-Looking Statements This section highlights that the report contains forward-looking statements, subject to various known and unknown risks and uncertainties - The report contains forward-looking statements subject to known and unknown risks and uncertainties[79] - Key risk factors include changes in economic and business conditions, natural disasters, geopolitical developments, operating costs, labor issues, competition, cyber-attacks, and changes in tax laws and regulations[80][82] Operating Results and Outlook This section analyzes recent operating performance and provides an outlook for future financial results, including revenue and margin expectations | Metric | Q2 2025 vs. Q2 2024 Change | YTD 2025 vs. YTD 2024 Change | | :-------------------------------------- | :------------------------- | :--------------------------- | | Total revenues | 8.2% | 8.3% | | Net income | (7.0%) | (7.4%) | | Operating profit | (5.1%) | (3.6%) | | Operating profit margin under GAAP | (240) bps | (220) bps | | Adjusted EBITDAre | 3.1% | 4.1% | | Diluted earnings per common share | (5.9%) | (6.9%) | | Adjusted FFO per diluted share | 1.8% | 1.7% | | Comparable hotel RevPAR | 3.0% | 5.0% | | Comparable hotel EBITDA margin | (120) bps | (50) bps | - Revenue improvements were driven by a 3.7% increase in room rates at comparable hotels and contributions from 2024 acquisitions[85] - Operating profit margin declined primarily due to a decrease in net gains on insurance settlements[87] - Outlook for full year 2025: comparable hotel RevPAR growth expected between 1.5% and 2.5%, with margins expected to decline due to higher wages and benefits[92] - Demand is expected to continue to be driven by transient business, with anticipated softness in short-term group bookings due to economic uncertainty[90] Strategic Initiatives This section details key strategic actions, including debt refinancing, asset dispositions, and capital expenditure plans for property enhancements - Issued $500 million of 5.7% Series M senior notes in May 2025 to redeem $500 million of Series E senior notes[94] - Sold The Westin Cincinnati for $60 million, recording a $21 million gain on sale[94] | Capital Expenditures (YTD June 30, 2025) | Amount (millions) | | :--------------------------------------- | :---------------- | | ROI capital projects | $109 | | Renewal and replacement projects | $129 | | Hurricane and other restoration work | $60 | - Expected full year 2025 capital expenditures: $590 million to $660 million, including $170 million to $180 million for the Hyatt transformational capital program[97] - Construction continued on 40 Four Seasons-branded condominiums at Four Seasons Resort Orlando, with $43 million spent YTD 2025[98] Results of Operations This section provides a detailed analysis of revenue and expense trends, highlighting factors influencing changes in financial performance | Revenue Category | Q2 2025 (millions) | Q2 2024 (millions) | Q2 Change (%) | YTD 2025 (millions) | YTD 2024 (millions) | YTD Change (%) | | :--------------- | :----------------- | :----------------- | :------------ | :------------------ | :------------------ | :------------- | | Rooms | $949 | $885 | 7.2% | $1,887 | $1,738 | 8.6% | | Food and beverage | $478 | $447 | 6.9% | $981 | $920 | 6.6% | | Other | $159 | $134 | 18.7% | $312 | $279 | 11.8% | | Total revenues | $1,586 | $1,466 | 8.2% | $3,180 | $2,937 | 8.3% | - Total revenues increased due to 2024 acquisitions and higher room rates, partially offset by a decline in group demand[101] | Expense Category | Q2 2025 (millions) | Q2 2024 (millions) | Q2 Change (%) | YTD 2025 (millions) | YTD 2024 (millions) | YTD Change (%) | | :--------------- | :----------------- | :----------------- | :------------ | :------------------ | :------------------ | :------------- | | Rooms | $233 | $214 | 8.9% | $458 | $416 | 10.1% | | Food and beverage | $313 | $286 | 9.4% | $636 | $581 | 9.5% | | Other departmental and support expenses | $375 | $343 | 9.3% | $739 | $677 | 9.2% | | Management fees | $70 | $69 | 1.4% | $139 | $138 | 0.7% | | Other property-level expenses | $107 | $101 | 5.9% | $218 | $205 | 6.3% | | Depreciation and amortization | $195 | $188 | 3.7% | $391 | $368 | 6.3% | | Total property-level operating expenses | $1,293 | $1,201 | 7.7% | $2,581 | $2,385 | 8.2% | - Property-level operating expenses increased primarily due to 2024 acquisitions and higher wage and employee benefits (expected 6% inflation in 2025)[105] - Net gain on insurance settlements decreased significantly from $56 million in Q2 2024 to $9 million in Q2 2025[113] - Interest expense increased due to higher outstanding debt balances and refinancing at higher interest rates[113] - Other gains in Q2 2025 include a $21 million gain on the sale of The Westin Cincinnati[114] Comparable Hotel RevPAR Overview This section analyzes comparable hotel RevPAR and Total RevPAR trends, identifying top-performing markets and business mix shifts - Comparable hotel RevPAR increased 3.0% for Q2 2025 and 5.0% for YTD 2025, driven by higher room rates and strong transient demand[85] - Comparable hotel Total RevPAR increased 4.2% for Q2 2025 and 5.0% for YTD 2025[86] - Top performing markets for Q2 2025 Total RevPAR growth were Atlanta (+20.8%), Maui (+18.5%), Miami (+16.4%), and San Francisco/San Jose (+15.7%)[86] - Austin (-34.6%) and Washington, D.C. (CBD) (-11.0%) experienced declines due to renovation projects and the closure of Austin's convention center[86] | Business Mix (Comparable Hotels) | Q2 2025 Room Nights Change vs. 2024 | Q2 2025 Revenues Change vs. 2024 | | :------------------------------- | :---------------------------------- | :------------------------------- | | Transient business | 1.6% | 6.8% | | Group business | (6.1%) | (4.9%) | | Contract business | 14.6% | 21.7% | - Group revenue decreased in Q2 2025 due to planned renovation disruption and business mix shifting from group to transient in Maui, along with softness in short-term group demand[132][134] Liquidity and Capital Resources This section assesses the company's financial flexibility, detailing cash position, available credit, debt structure, and cash flow activities - As of June 30, 2025, the company had $490 million in cash and cash equivalents, $279 million in FF&E escrow reserves, and $1.5 billion available under its credit facility[139] - Total debt as of June 30, 2025, was $5.1 billion, with a weighted average interest rate of 4.9% and a weighted average maturity of 5.4 years; 80% of debt is fixed rate[151] - Net cash provided by operating activities decreased to $749 million YTD 2025 from $818 million YTD 2024, primarily due to payments for condominium inventory and increased interest payments[146] - Net cash used in investing activities decreased to $198 million YTD 2025 from $775 million YTD 2024, due to lower acquisitions in 2025[147] - Net cash used in financing activities increased to $583 million YTD 2025 from $353 million YTD 2024, mainly due to higher common stock repurchases and dividends[148] - The next significant debt maturity is $400 million of senior notes due in February 2026[138] | Financial Covenant (as of June 30, 2025) | Actual Ratio | Covenant Requirement | | :--------------------------------------- | :----------- | :------------------- | | Leverage ratio | 2.8x | Maximum ratio of 7.25x | | Fixed charge coverage ratio | 5.3x | Minimum ratio of 1.25x | | Unsecured interest coverage ratio | 6.9x | Minimum ratio of 1.75x | Dividend Policy This section outlines the company's dividend distribution policy, emphasizing REIT qualification requirements and recent dividend declarations - Host Inc. is required to distribute at least 90% of its annual taxable income to maintain REIT qualification[156] - The company's policy is to distribute, over time, 100% of its taxable income[158] - A regular quarterly cash dividend of $0.20 per share was announced on June 12, 2025, and paid on July 15, 2025[158] Critical Accounting Estimates This section highlights the reliance on management's estimates and assumptions in financial statement preparation, acknowledging potential differences - Financial statements are prepared in conformity with GAAP, requiring management to make estimates and assumptions[160] - Actual results could differ from these estimates due to future uncertainties[160] Comparable Hotel Operating Statistics and Results This section defines criteria for comparable hotels and identifies properties excluded from these statistics due to disruptions - Comparable hotels are properties owned or leased, not held-for-sale, and not significantly impacted by damage or large-scale capital projects requiring closures of one month or longer[161] - As of June 30, 2025, 78 of 80 hotels were classified as comparable[165] - Excluded from comparable hotel results are The Don CeSar (hurricane disruption), Alila Ventana Big Sur (highway collapse), and sales and marketing expenses for Four Seasons Resort Orlando condominium units[166] Non-GAAP Financial Measures This section defines and reconciles various non-GAAP financial measures used by the company, such as EBITDA and Adjusted FFO - The company uses non-GAAP financial measures including EBITDA, EBITDAre, Adjusted EBITDAre, NAREIT FFO, Adjusted FFO per diluted share, and comparable hotel operating results[173] - Adjusted EBITDAre excludes property insurance gains/losses, acquisition costs, litigation gains/losses, severance expense, and non-cash stock-based compensation[175] - Adjusted FFO per diluted share further adjusts NAREIT FFO for gains/losses on debt extinguishment, acquisition costs, litigation gains/losses, severance expense, and non-cash stock-based compensation[180][184] | Non-GAAP Metric (in millions) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :---------------------------- | :------ | :------ | :------- | :------- | | EBITDA | $505 | $496 | $1,008 | $993 | | EBITDAre | $491 | $502 | $999 | $1,006 | | Adjusted EBITDAre | $496 | $481 | $1,010 | $970 | | NAREIT FFO | $395 | $399 | $835 | $825 | | Adjusted FFO | $400 | $404 | $846 | $836 | Item 3. Quantitative and Qualitative Disclosures about Market Risk This section addresses the company's exposure to market risks, specifically interest rate and exchange rate sensitivity, and their management - As of June 30, 2025, 80% of outstanding debt bore interest at fixed rates[197] - The company had no interest rate derivatives outstanding as of June 30, 2025[197] - The company has operations in Brazil and Canada, and a minority investment in India, exposing it to currency exchange risks[199] - No foreign currency hedging transactions were entered into during the first half of 2025, but two foreign currency forward purchase contracts for CAD 99 million ($73 million) mature in August 2025[199] Item 4. Controls and Procedures This section confirms the effectiveness of disclosure controls and procedures for Host Inc. and Host L.P., reporting no material changes - Management, including the CEO and CFO, concluded that disclosure controls and procedures for Host Inc. were effective as of June 30, 2025[201] - No material changes in internal control over financial reporting occurred during the most recent fiscal quarter for Host Inc. or Host L.P.[202][204] - Disclosure controls and procedures for Host L.P. were also evaluated and deemed effective[203] PART II. OTHER INFORMATION This part includes details on unregistered sales of equity securities, other information, and a list of exhibits filed with the report Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section details the company's common stock repurchase activities and corresponding repurchases of Host L.P. common OP units - During Q2 2025, Host Inc. repurchased 6.7 million shares of common stock for $105 million at an average price of $15.56 per share[207] - As of June 30, 2025, $480 million remained available for repurchase under the common share repurchase program[207] - Host L.P. purchased/redeemed 7.07 million common OP units in Q2 2025, including units to fund Host Inc.'s share repurchase program[208][209][210] Item 5. Other Information This section confirms no Rule 10b5-1 trading arrangements were adopted, modified, or terminated by directors or officers - No director or officer adopted, modified, or terminated any Rule 10b5-1 trading arrangement during the period covered by the report[212] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including security holder rights, certifications, and XBRL financial statements - Exhibits include supplemental indentures, certifications (Section 302 and 906 of Sarbanes-Oxley Act), and XBRL-formatted financial statements[215][217][218] - Representations and warranties in exhibited agreements are for the benefit of other parties and may not reflect the actual state of affairs[213][216]