Economic Overview - The current economic landscape is characterized by a "K-shaped" recovery, where wealthier Americans are increasing their spending while lower-income consumers are pulling back due to rising costs [1][3]. Consumer Spending Trends - Lower- and middle-income consumers are facing significant pressure from rising prices on essentials like groceries and gas, leading to a decline in their spending [3]. - Wealthier consumers are benefiting from stock market gains and rising home values, which is contributing to their increased purchasing power [3]. Company Insights - Coca-Cola is experiencing divergent sales growth, with higher demand for premium products among wealthier consumers and increased sales at dollar stores catering to lower-income shoppers [4]. - McDonald's is responding to the divided consumer landscape by expanding its value menu, as traffic from lower-income consumers has dropped by double digits [5]. - Chipotle is also noting pressure on lower-income consumers, which will influence their pricing strategy moving forward [6]. Automotive Sector - The average price for a new vehicle has surpassed $50,000 for the first time, driven by wealthier households who have access to favorable loan conditions [8][9]. - Auto loan defaults are rising, particularly among consumers with lower credit scores, indicating financial strain in this demographic [8]. Airline Industry - Delta Air Lines anticipates that revenue from premium offerings will exceed that from coach cabins next year, reflecting a trend towards higher-cost tickets among affluent travelers [10]. Hospitality Sector - Hilton is observing a bifurcation in consumer spending but does not expect this trend to persist, predicting a shift as inflation and interest rates decrease [11][12]. - Revenue from luxury offerings at Hilton is performing well, while affordable brands are experiencing a drop in revenue [12][13].

Investor Presentation October 23, 2025 WYNDHAM HOTELS & RESORTS La Quinta Inn & Suites by Wyndham Phoenix, Arizona, USA Opened August 2025 Introduction to Wyndham Hotels & Resorts Largest hotel franchisor worldwide(a) Leading brands in the resilient select-service segment Asset-light business model generating significant free cash flow Primarily leisure-focused, "drive to" portfolio of hotels ~8.300" Hotels ~855,000~ Current Rooms ~257,000 ~70% Leisure Guest Mix Data is approximated as of September 30, 2025 ...

Financial Data and Key Metrics Changes - Global RevPAR grew by 0.1% in Q3 2025, consistent with Q2 performance, driven by strong trading in EMEA-A and improvement in Greater China [5][6] - Year-to-date global RevPAR increased by 1.4% [22] - In the Americas, RevPAR decreased by 0.9% in Q3, with the U.S. down 1.6% due to slower trading conditions [5][6] - EMEA-A RevPAR increased by 2.8% in Q3, with year-to-date growth at 3.8% [6][7] - Greater China saw a 1.8% decline in RevPAR in Q3, an improvement from previous quarters [7][8] Business Line Data and Key Metrics Changes - Rooms revenue for business days increased by 4% globally, while leisure and groups decreased by 2% and 4% respectively [8] - System growth included the opening of 14,500 rooms across 99 hotels globally, marking a 17% year-on-year increase [9] - The Americas saw a gross system growth of 3.6% year-on-year, with 2,700 rooms opened in Q3 [10] - EMEA-A region experienced a gross system growth of 10.4% year-on-year, with 4,200 rooms opened [11] - Greater China achieved a gross system growth of 12.8% year-on-year, with 7,600 rooms opened [12] Market Data and Key Metrics Changes - In EMEA-A, RevPAR growth varied by market, with the UK up 2.8% and the Middle East up 9.5% [7] - Greater China showed strong growth in Tier 1 cities, while Tiers 2 to 4 faced declines [8] - U.S. government travel remained about 20% lower than the previous year, impacting overall demand [6] Company Strategy and Development Direction - The company plans to launch a new collection brand targeting the upscale to upper upscale segment, initially focusing on the EMEA-A region [19][20] - The new brand aims to complement existing brands like Voco and Vignette Collection, which have seen success in the market [19][20] - The company is optimistic about long-term demand drivers, despite short-term challenges in the U.S. market [18][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth in the U.S. as economic uncertainty subsides [6][18] - The outlook for 2025 includes expectations for 12% EBIT growth and 15% EPS growth [22] - Management highlighted strong fundamentals in the U.S. economy, including employment and consumer spending, as positive indicators for future performance [32][34] Other Important Information - The company is 78% through its $900 million share buyback program, reducing share count by 3.9% [14] - IHG plans to change the currency of its ordinary shares traded on the London Stock Exchange from British pounds to U.S. dollars starting January 2026 [15][16] Q&A Session Summary Question: Net system growth for 2026 and RevPAR outlook - Management is comfortable with a consensus of around 4.5% net system growth for 2025, with strong signings and conversions expected to continue [25][27] - RevPAR for the fourth quarter is expected to be similar to Q3, with short booking windows impacting performance [30][31] Question: New brand launch and U.S. demand weakness - The new brand launch is focused on the EMEA region due to a higher proportion of independent hotels available for conversion [42][43] - Weakness in U.S. leisure demand is attributed to several factors, including lower international inbound travel and economic uncertainties [47][48] Question: Timing of new brand launch and performance in China - Details on the new brand launch will be provided in the coming months, with expectations for continued improvement in China [55][56] Question: Ruby brand performance and churn rates - The Ruby brand is performing well with multiple signings and openings planned [62] - Management aims to reduce churn rates to 1.5% over the long term, with no immediate need for brand refreshes [66][67] Question: Buyback completion - Management is confident in completing the buyback program by the end of the year [67]

Financial Data and Key Metrics Changes - Global RevPAR grew by 0.1% in Q3 2025, consistent with Q2 performance, driven by strong trading in EMEA-A and improvement in Greater China [4] - Year-to-date global RevPAR increased by 1.4% [20] - In the Americas, RevPAR decreased by 0.9% in Q3, with the U.S. down 1.6% due to slower trading conditions [4][5] - EMEA-A saw RevPAR growth of 2.8% in Q3, with year-to-date growth at 3.8% [5] - Greater China experienced a 1.8% decline in RevPAR in Q3, an improvement from previous quarters [6] Business Line Data and Key Metrics Changes - Rooms revenue for business days increased by 4% globally, while leisure and groups saw declines of 2% and 4% respectively [7] - System growth included the opening of 14,500 rooms across 99 hotels globally in Q3, marking a 17% year-on-year increase [8] - The Americas' gross system growth was 3.6% year-on-year, with 2,700 rooms opened in Q3 [9] - EMEA-A region achieved gross system growth of 10.4% year-on-year, with 4,200 rooms opened in Q3 [10] - Greater China reported gross system growth of 12.8% year-on-year, with 7,600 rooms opened in Q3 [11] Market Data and Key Metrics Changes - In EMEA-A, RevPAR growth varied by market, with the U.K. up 2.8% and the Middle East up 9.5% [6] - Greater China showed strong growth in Tier one cities, while Tier two to four cities faced declines [7] - The U.S. market continues to experience challenges with government travel down 20% compared to the previous year [5] Company Strategy and Development Direction - The company plans to launch a new collection brand focused on the premium segment, initially targeting the EMEA-A region [17][18] - The new brand aims to expand the company's offerings and attract more owners to its enterprise platform [17] - The company is optimistic about long-term demand drivers, despite short-term challenges in the U.S. market [16][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the return to growth in the U.S. as economic uncertainty subsides [5] - The company remains on track to meet full-year profit and earnings expectations, with consensus for operating profits at $1.259 billion, implying 12% growth [14][15] - Management highlighted strong fundamentals in the U.S. economy, including low unemployment and resilient consumer spending [30][32] Other Important Information - The company is 78% through its $900 million share buyback program, reducing share count by 3.9% [12] - IHG plans to change the currency of its ordinary shares traded on the London Stock Exchange from British pounds to U.S. dollars starting January 2026 [13][14] Q&A Session Summary Question: Net system growth for 2026 and RevPAR outlook - Management is comfortable with consensus expectations for net system growth at around 4% for 2026, supported by strong signings and conversions [24][26] - RevPAR is expected to remain flat in Q4, with management confident in achieving growth in 2026 based on economic fundamentals [28][30] Question: New brand launch and U.S. demand weakness - The new brand launch is focused on the EMEA region due to a larger addressable market of independent hotels [39] - Weakness in U.S. leisure demand is attributed to several factors, including lower international inbound travel and temporary market conditions [44][45] Question: Ruby brand performance and churn rates - Ruby is performing well with five signings and 20 open hotels, with plans for further expansion in the U.S. [59] - Management aims to reduce churn rates to 1.5% over time, with no immediate need for brand refreshes [63] Question: U.S. occupancy and industry dynamics - Management noted that improved revenue management strategies have led to higher rates, leaving room for occupancy growth [71] - The company is optimistic about returning to pre-COVID occupancy levels, despite current challenges in the U.S. market [73]

Core Insights - Hilton reported an increase in profit and revenue for Q3 2025, with net income of $420 million and diluted EPS of $1.78, compared to $344 million and $1.38 per share in Q3 2024 [1][2] - Revenue for the quarter rose by 8.8% to $3.12 billion, while adjusted EBITDA was $976 million [2] - System-wide comparable RevPAR decreased by 1.1% on a currency neutral basis compared to Q3 2024, attributed to modest occupancy and average daily rate declines [2][4] Financial Performance - For the nine months ending September 30, 2025, system-wide comparable RevPAR increased by 0.3%, with net income at $1.16 billion and adjusted EBITDA at $2.78 billion, resulting in diluted EPS of $4.84 [3] - Hilton forecasts full year 2025 net income between $1.604 billion and $1.625 billion, with adjusted EBITDA expected to be in the range of $3.685 billion to $3.715 billion [4] Development and Growth - Hilton approved 33,000 rooms for development in Q3 2025, increasing its global pipeline to 515,400 rooms, a 5% increase from the previous year [3] - The company added 24,800 rooms to its system, resulting in a net addition of 23,200 rooms and a 6.5% rise in net unit growth from the same point last year [4] - Hilton projects net unit growth between 6.5% and 7.0% in 2025, supported by a strong development pipeline and new brand introductions [6][7] Strategic Initiatives - Hilton opened its 9,000th property with the launch of Signia by Hilton La Cantera Resort and Spa, marking nearly three hotel openings per day since August 2024 [6][7] - The introduction of a new lifestyle brand, Outset Collection by Hilton, is part of the strategy to grow its portfolio and increase market share in hotel conversions in the US [7]

Summary of Conference Call Notes Industry Overview - The conference call focuses on the hotel industry in the Asia Pacific region, specifically Chinese hotel stocks, H World Group Ltd (HTHT) and Atour Lifestyle Holdings Ltd (ATAT) [1][2][3] Key Points and Arguments H World Group Ltd (HTHT) - **Inaugural Capital Markets Day**: Scheduled for October 30, 2025, expected to provide a detailed growth roadmap aiming to operate 20,000 hotels domestically over the next five years [6] - **Brand Positioning**: The company plans to discuss existing and new initiatives to capture more market share domestically [6] - **International Developments**: Recent overseas developments, particularly in Southeast Asia, are anticipated to be highlighted [6] - **Financial Projections**: Expectations for asset-light business revenue and operating profit projections to be shared [6] - **RevPAR Trends**: Positive signs of business demand recovery, with expectations for RevPAR (Revenue per Available Room) to turn positive year-over-year in 4Q25, aided by an easy comparison base from November 2024 [6] - **3Q25 Results**: Anticipated to show a narrower RevPAR decline of -1% compared to -4% in 1H25, with positive guidance for 4Q25 expected [6] Atour Lifestyle Holdings Ltd (ATAT) - **Retail Performance**: Reported a 74% year-over-year growth in retail revenue in 1H25, with an 86% increase during the "618" sales promotion [6] - **Market Expectations**: The market anticipates a 65-70% year-over-year growth in "Double 11" sales promotion; any deviation from this could act as a catalyst for stock movement [6] Valuation Methodology and Risks - **HTHT Valuation**: Based on discounted cash flow (DCF) with a WACC of 10.5%, medium-term growth of 8% (2028-35e), and a terminal growth rate of 2% [8] - **ATAT Valuation**: Also based on DCF, with a forecasted 17.5% EBITDA CAGR from 2025-29 and an 8% CAGR thereafter, implying a 17x EV/EBITDA for 2025 [7] Risks Identified - **HTHT Risks**: - Upside: More hotel openings than expected, lower reinvestment costs, higher industry RevPAR [10] - Downside: Significant slowdown in retail sales growth, industry RevPAR declines over 3% YoY in 2026 [10] - **ATAT Risks**: - Upside: Stronger-than-expected RevPAR growth, quicker mix upgrade leading to higher blended RevPAR growth [11] - Downside: Industry RevPAR declines deeper than -5% YoY for 2025, rising supply and competition in the low/mid-scale segment [11] Additional Insights - The hotel industry is currently in a low season, but business demand trends in late October and November will be critical for assessing the necessity of business travel [1] - The conference call emphasizes the importance of upcoming events and financial results as potential catalysts for stock performance in the hotel sector [2][5]

Core Insights - Wyndham Hotels reported a revenue of $382 million for the quarter ended September 2025, which is a decrease of 3.5% compared to the same period last year [1] - The company's EPS was $1.46, an increase from $1.39 in the year-ago quarter, resulting in an EPS surprise of +2.82% against a consensus estimate of $1.42 [1] - The reported revenue fell short of the Zacks Consensus Estimate of $402.09 million, indicating a surprise of -5% [1] Financial Performance Metrics - Total Rooms stood at 855,400, below the average estimate of 874,696 based on four analysts [4] - Total RevPAR was reported at $50.05, slightly lower than the average estimate of $50.57 from four analysts [4] - Fee-related and other revenues from royalties and franchise fees were $147 million, compared to the estimated $161.29 million, reflecting a year-over-year decline of -7.6% [4] - Marketing, reservation, and loyalty revenues were $149 million, below the average estimate of $159.31 million, marking a -7.5% change year-over-year [4] - Management and other fees generated $2 million, compared to the estimated $3 million, representing a significant year-over-year decline of -33.3% [4] - License and other fees reached $35 million, exceeding the estimated $33.83 million, with a year-over-year increase of +9.4% [4] - Other fee-related revenues amounted to $49 million, surpassing the average estimate of $42.13 million, showing a year-over-year growth of +25.6% [4] Stock Performance - Wyndham's shares have returned -1.8% over the past month, contrasting with the Zacks S&P 500 composite's +1.1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Core Viewpoint - A panel of experts concluded that claims against LuxUrban Hotels Inc. regarding large-scale tax liabilities in New York are likely inaccurate and legally precluded under state and city law, as well as inconsistent with established OTA payment systems [1][2]. Findings and Legal Basis - Between 2020 and 2025, LuxUrban Hotels generated approximately $248 million in gross room revenue across 11 U.S. states and cities, with audited net room revenue totaling $149 million, of which only $56 million (22.6%) originated from New York operations [3]. - Under New York State Tax Law, entities defined as "room remarketers" or "resellers," including OTAs, are responsible for collecting customer payments and remitting occupancy and sales taxes [4]. - Legal precedents confirm that hotels do not remit occupancy taxes for prepaid OTA transactions; instead, OTAs handle these responsibilities [5]. Implications Beyond Taxation - The OTA payment and tax structure defines the merchant-customer relationship and tax responsibility, indicating that LuxUrban did not control or process customer payments for 92–97% of its bookings [6][7]. Potential Damages and Legal Exposure of False Claims - False claims alleging unpaid taxes may expose responsible parties to defamation and commercial disparagement under New York law, with potential recoverable damages for LuxUrban reaching into the tens of millions of dollars [8][9]. - The spokesperson emphasized that the issue is a matter of law and factual record, asserting that LuxUrban neither processed guest payments nor collected occupancy taxes for OTA-booked stays [10].

Core Insights - The hospitality company has revised its full-year outlook downward due to lower-than-expected revenue reported in the third quarter [1] Financial Performance - The company experienced a decline in revenue during the third quarter, prompting the adjustment in its financial forecast [1]

Core Thesis - H World Group Limited (HTHT) is positioned as a strong investment opportunity due to its robust operational model, technology integration, and growth potential in the Chinese hotel market [1][5]. Company Overview - H World Group is a leading Chinese hotel operator with a diverse portfolio that includes budget to upscale hotels and partnerships with global brands [2]. - The company leverages proprietary technology, a strong loyalty program, and a significant domestic presence to create a competitive moat [2][3]. Technology and Operations - The "Huazhu Cloud" system integrates various management functions, utilizing AI-driven revenue management systems to optimize room rates in real time, enhancing occupancy and profitability [2][3]. - The "H Rewards" program boasts 288 million members, generating 76% of bookings through direct channels, which reduces reliance on online travel agencies (OTAs) [3]. Growth Strategy - HTHT operates over 12,000 hotels in China, focusing 99% of its expansion plans domestically with an asset-light "manachised" model that combines franchising and direct management [3]. - The company aims to achieve a target of 20,000 hotels by 2030, supported by a strong development pipeline and historical growth trends [4]. Financial Performance - Recent Q2 2025 results indicate modest revenue growth and slight declines in Revenue Per Available Room (RevPAR), attributed to accelerated hotel openings and renovations [4]. - Despite temporary challenges, management remains optimistic about future growth, projecting earnings and free cash flow growth of 10-15% annually through 2030 [5]. Investment Potential - The stock, currently trading around $35, offers potential annual returns of 15-20%, supported by resilient operations and a favorable growth trajectory [5]. - HTHT's competitive ecosystem and ongoing investments in brand quality create a sustainable advantage, making it a compelling investment opportunity [5].