Xenia Hotels Q2 FFO Up 9.6%

Core Insights - Xenia Hotels & Resorts reported strong Q2 2025 earnings, significantly exceeding estimates for both earnings and revenue, with adjusted FFO per diluted share at $0.57 versus an estimated $0.30, and revenue at $287.6 million, surpassing consensus by over $14 million [1][5][10] Financial Performance - Adjusted FFO per diluted share increased by 9.6% year-over-year from $0.52 in Q2 2024 to $0.57 in Q2 2025 [2] - Revenue rose 5.4% year-over-year, from $272.9 million in Q2 2024 to $287.6 million in Q2 2025 [2] - Net income per share surged 273.3% year-over-year, reaching $0.56 compared to $0.15 in Q2 2024 [2][6] - Adjusted EBITDAre grew 16.3% year-over-year to $79.5 million, reflecting operational improvements [2][6] - Same-Property RevPAR increased by 4.0% year-over-year, from $187.95 in Q2 2024 to $195.51 in Q2 2025 [2] Operational Highlights - Strong demand in group and catering segments significantly contributed to revenue growth, with catering revenues showing outsized gains [7] - Food and beverage revenue within the same-property portfolio increased by 20.9%, enhancing overall profitability [7] - The Grand Hyatt Scottsdale Resort's renovations contributed to a 4.0% increase in Same-Property RevPAR, with RevPAR in the Phoenix market up 60.9% in Q1 2025 [7] Strategic Focus - The company focuses on owning luxury and upper-upscale hotels in major U.S. markets, partnering with established hotel brands for management [3] - Recent strategies include selling non-core assets, selective hotel investments, and disciplined capital spending to enhance portfolio quality and profitability [4] - Xenia's capital expenditure plans for the year are set between $75 million to $85 million, with $18.5 million already invested in property upgrades [10][9] Future Outlook - Management raised guidance for 2025, projecting Adjusted EBITDAre between $249 million to $263 million and Adjusted FFO between $166 million to $180 million [10] - Adjusted FFO per diluted share is now expected to be in the range of $1.66 to $1.80 for the full year [10] - The company anticipates continued strength in group demand, particularly in the fourth quarter, while leisure-related revenue is expected to normalize [11]