Revenue per available room was down 3% across the globe and 4% in the U.S. for Wyndham Hotels & Resorts, and officials hoped to paint a rosier long-term picture tied to rooms growth during the company's second-quarter earnings call.
The company's outsize position among lower-end segments meant a greater degree of exposure to the economic uncertainty that slowed down hotel performance in the U.S. in the previous quarter. Wyndham's RevPAR managed to increase slightly — up 1% — outside the U.S.
"Higher for longer interest rates, persistent inflation, and uncertainty around immigration and trade have created an environment of ongoing economic volatility for economy and midscale guests, who remain especially sensitive to these dynamics," Wyndham President and CEO Geoff Ballotti said during a call with analysts Thursday.
Ballotti said the biggest spots of weakness have been leisure-driven destinations, particularly in Sunbelt states Texas, Florida and California. But overall, these trends were generally expected by Wyndham, he added.
"We're not seeing anything structurally ... that concerns us," he said. "Pricing is holding steady. [Average daily rate] year over year was essentially flat and up 17% to 2019."
Wyndham's booking lead times and average lengths of stay were also consistent year over year, Ballotti said. And there's more economic optimism going forward than the sentiments from earlier in the year.
"We run internal research on our guests that point towards more optimism on travel intent and less concern about economic worries than both last year and even last month," he said. "We look at all the research we get our hands on. ... And we continue to see consumers with more plans to travel over the next six months."
Wyndham's full-year guidance on RevPAR change remained the same at a range of down 2% to up 1% for the full year. In the first half of 2025, Wyndham's RevPAR fell globally 1% compared to the prior year.
Rooms growth
Amid the backdrop of RevPAR softness, Wyndham officials said the second quarter was relatively strong for hotel rooms growth, up 4% globally year over year.
The company also has a record pipeline of over 255,000 rooms, which represents a 5% increase compared to the second quarter of 2024.
"We opened over 16,000 rooms in [the second quarter], bringing June year-to-date new additions to over 30,000 rooms, a record first half of openings for our company and 3% higher than last year," Ballotti said.
Wyndham slightly revised up its full-year outlook for new rooms growth to a range of 4% to 4.6%, up from 3.6% to 4.6%.
Breakup in China
During the earnings call, Ballotti said Wyndham has issued a notice of default to the master franchisor of its Super 8 brand in China, which could result in the termination of their deal due to "identified violations of the license agreement."
He said the group — Tian Rui Hotel Corp. — has "struggled to add new units and retain existing ones."
Because of issues with that company, Wyndham excluded Super 8 properties in China out of its quarterly data on "reported system size, RevPAR, royalty rate and related growth metrics."
In addition to problems with this specific master licensee, Ballotti said Wyndham has also fundamentally moved away from that deal structure as a vehicle for growth, preferring a direct franchising model across the globe.
In October 2024, the company touted its direct franchising growth in China — opening 600 hotels over a five year span — and during Thursday's earnings call, Ballotti said the company has "the biggest, largest, most successful franchise sales team over there today."
"We're no longer signing master franchising agreements to grow," he said. "And these agreements were entered into over 20 years ago with local developers before we had franchise sales teams located in those markets as we do today."
Asked whether there's any possibility the breakup in China could be a net positive for Wyndham, Chief Financial Officer and Head of Strategy Michele Allen said it could be.
"It's just too early to speculate on on potential outcomes, but I can definitely see a few paths where this could be a positive for Wyndham, for the licensees and and even potentially for the master," she said.
Second-quarter performance
Net revenues for the quarter grew year over year from $367 million in 2024 to $397 million in 2025, according to the earnings release. Net income for the quarter was roughly flat at $87 million compared to $86 million the year prior.
Wyndham also reported a 10% increase in adjusted earnings before interest, taxes, depreciation and amortization to $195 million.
As of press time, Wyndham's stock was trading at $90.20 a share, down 9.6% year to date. The New York Stock Exchange Composite Index was up 9.5% for the same period.