Financial Data and Key Metrics Changes - Q1 2025 recorded adjusted EBITDA of $5.6 million, marking the strongest performance in the company's history, indicating successful operational discipline [19][20] - Total revenue for Q1 was approximately $66 million, down 18% year over year, with subscription revenue at $21 million, down 26% [20][21] - Travel revenue decreased to $42 million, down 16%, attributed to a lower member count and timing impacts related to curated experiences [22] Business Line Data and Key Metrics Changes - The company had over 11,000 members at the end of Q1, with approximately 10,200 active club members and 1,300 active Pass members, reflecting a strategic shift towards club growth [20][21] - Cost of revenue declined by $8 million year over year due to ongoing portfolio optimization efforts [20] - Operating expenses decreased by approximately $8 million, benefiting from reduced overhead and streamlined operations [20] Market Data and Key Metrics Changes - The company maintained a strong occupancy level of 74% in controlled residence accommodations, with an 8% increase in average daily rate (ADR) to over $2,100 [22] - The strategic partnerships with renowned hotels like Hondas and Fairmont were renewed, providing members with exclusive access to select accommodations [15] Company Strategy and Development Direction - The company is focused on four key pillars: operational efficiency, brand elevation, member experience, and a robust technology and digital marketing platform [8][10] - The goal is to build a scalable, durable, and efficient growth model while enhancing service quality and member experiences [8][10] - A digital marketing platform is being developed to connect with high-value travelers and expand the total addressable market [17][24] Management's Comments on Operating Environment and Future Outlook - Management acknowledged expected near-term revenue headwinds but expressed confidence in the strategic decisions made over the past year translating to stronger financial results [25] - The company reiterated its full-year 2025 guidance, expecting adjusted EBITDA between breakeven and $5 million, and revenue between $235 million and $255 million [24][25] - The focus remains on balancing investment for future profitable growth with operational efficiencies [25] Other Important Information - Q1 free cash flow was negative $8 million, including approximately $2.6 million of one-time cash outflows related to underperforming lease terminations [22] - Adjusted free cash flow, excluding one-time lease-related items, totaled more than $8 million over the same period [23] Q&A Session Summary Question: Update on marketing efforts to drive and retain members - The company is growing its sales force to reach a curated target audience, relying on direct connections rather than direct marketing [29][30] Question: When and where do club memberships see stabilization? - Management expects continued headwinds on member count through the first half of the year, with stabilization anticipated in the second half of 2025 and into 2026 [32][33] Question: Status of expense cutting efforts - The company is now focused on fine-tuning expenses and improving service quality, with significant opportunities for operational efficiency still ahead [37][39] Question: Major milestones targeted for 2025 - Key goals include achieving sustained profitability, establishing operational efficiency as a core competency, and launching a digital marketing platform [42][44]