Park Q3 2026 Earnings: RevPAR and Adjusted FFO Rise

Park Hotels & Resorts (NYSE: PK) reported Q3 2026 comparable hotel revenue of $565 million, up 5.7% from $535 million, while diluted loss per share widened to $0.10 from $0.08 in Q3 2025. Comparable RevPAR rose 8.4% to $201.02 as both room rates and occupancy improved, but GAAP operating income declined even as adjusted EBITDA and adjusted FFO increased.

Core Earnings Data

Room pricing and occupancy both supported the quarter. Comparable ADR increased 5.0% to $263.19, while occupancy rose 2.4 percentage points to 76.4%, producing faster RevPAR growth than hotel revenue growth.

Adjusted results improved, with comparable hotel adjusted EBITDA rising 7.7% and its margin expanding 50 basis points to 25.7%. However, the stronger hotel-level performance did not translate into higher GAAP operating income.

Adjusted FFO attributable to stockholders increased 12.3% to $79 million. The difference between the GAAP loss and higher adjusted FFO is important for a hotel REIT because adjusted FFO excludes certain items included in GAAP earnings, although the release did not provide a single-factor explanation for the decline in operating income.

Business and Property Performance

Park’s core and non-core portfolios both generated higher RevPAR, revenue, and hotel adjusted EBITDA. Core hotels accounted for most of the portfolio’s hotel revenue and EBITDA, while the smaller non-core portfolio recorded the faster reported EBITDA growth rate.

Airport and suburban core hotels led by property type, with RevPAR increasing 20.3% as ADR rose 10.4% and occupancy improved 6.7 percentage points. Resort RevPAR increased 7.2%, while urban RevPAR rose 6.1%.

Individual property results were uneven. DoubleTree Washington DC–Crystal City recorded a 50.3% RevPAR increase, while Hilton Waikoloa Village, Juniper Hotel Cupertino, Casa Marina Key West, Waldorf Astoria Orlando, and Hilton Chicago each posted double-digit growth. Group and transient demand supported several of these properties, including an approximately 60% increase in group revenue at Casa Marina and more than 25% growth in transient revenue at Waldorf Astoria Orlando.

Several properties remained under pressure. Hilton New Orleans Riverside RevPAR fell 14.0%, Caribe Hilton declined 8.9%, and Signia by Hilton Orlando Bonnet Creek decreased 1.9%. New York Hilton Midtown increased RevPAR by 5.2%, but hotel revenue fell 5.9% and hotel adjusted EBITDA declined 30.7%. Recent storms reduced combined RevPAR growth at Park’s two major Hawaii resorts by nearly 280 basis points, although Hilton Hawaiian Village and Hilton Waikoloa Village still produced RevPAR growth of 5.0% and 20.2%, respectively.

RevPAR Growth Outpaced Profit Conversion

Group rooms revenue increased more than 18%, and higher-rated leisure demand also supported room revenue. However, hotel operating expenses rose 5%, reflecting higher costs associated with occupancy as well as wage and utility pressure.

The composition of group demand also limited ancillary revenue. Groups spent less outside their rooms than Park typically records, resulting in food and beverage revenue growth of only 2%, while banquet and catering revenue was approximately flat. Park also recognized lower cancellation and attrition fees. Consequently, comparable RevPAR increased 8.4%, but comparable hotel adjusted EBITDA rose 7.7%, total adjusted EBITDA increased 4.0%, and GAAP operating income declined 35.0%.

Liquidity, Debt, and Portfolio Investment

Park ended September with approximately $1.3 billion of liquidity, including $1 billion of available revolving credit capacity. Net debt was approximately $3.7 billion, while consolidated debt totaled $3.923 billion, excluding the company’s $105 million share of unconsolidated joint venture debt. The weighted-average interest rate was 5.87%, and the weighted-average maturity was 3.1 years including extension options.

During September, Park drew the remaining $600 million from its delayed-draw term loan and $700 million from the Bonnet Creek mortgage facility to repay the $1.275 billion Hilton Hawaiian Village mortgage before its November maturity. This removed a near-term maturity but largely replaced the old obligation with new debt. Variable-rate debt totaled $1.7 billion at a weighted-average rate of 6.12%, compared with $2.255 billion of fixed-rate debt at 5.67%. Park also expected to refinance the $150 million Hilton Santa Barbara Beachfront Resort mortgage in mid-November 2026.

Capital spending was $57 million during the quarter, and full-year expenditures are expected to reach $270 million to $280 million. Major projects include the completed renovation of Royal Palm South Beach Miami for more than $110 million and the ongoing renovation of the Ali’i Tower at Hilton Hawaiian Village for more than $100 million.

Park also continued reducing its non-core portfolio. It sold Hilton Short Hills for $12 million in July and The Wade for approximately $19 million in October. Together, the properties had approximately $79 million of anticipated capital expenditures and contributed an insignificant amount of 2025 hotel adjusted EBITDA. Five additional non-core hotels with $37 million of 2025 hotel adjusted EBITDA remain targeted for sale or disposition.

Full-Year 2026 Guidance

Park raised its RevPAR and adjusted earnings outlook after the stronger third quarter and improving fourth-quarter demand trends. The revision was mixed, however, because GAAP net income and EPS guidance moved lower while adjusted EBITDA and adjusted FFO guidance increased.

Fourth-quarter comparable RevPAR is expected to increase 5.5% to 7.5%, supported by preliminary October growth of nearly 11%. Full-year hotel operating expenses are expected to rise 4.5% to 5.0%.

The reduced GAAP profit ranges sit alongside approximately $13 million of incremental interest expense from $1.5 billion of refinancing activity during 2026, most of which is expected in the fourth quarter. The outlook is based on Park’s portfolio as of November 4, 2026 and does not incorporate potential future acquisitions, dispositions, or unannounced financing transactions.

Management Commentary

Management attributed the quarter’s room revenue growth to continued strength in group and leisure demand. At the end of September, core group revenue pace for 2027 was nearly 6% above the comparable booking position for 2026 one year earlier, while average booked group rates were projected to rise nearly 4%.

Park expects the renovated Royal Palm to add at least 200 basis points to comparable RevPAR growth in 2027 and to double the hotel’s EBITDA after stabilization. Management also expects a 15% to 20% return on the renovation investment. These are forward-looking expectations rather than contributions already reflected in a full quarter of results, as the hotel reopened in July 2026.

Risks Investors Should Monitor

• Cost growth may continue to limit operating leverage. Variable occupancy costs, wages, and utilities contributed to a 5% increase in hotel operating expenses, while lower group spending outside guestrooms constrained food and beverage revenue.
• Refinancing raises interest expense and rate exposure. Park expects approximately $13 million of incremental interest expense in 2026, and $1.7 billion of debt was variable-rate at quarter-end.
• Property performance remains uneven. Strong results in Washington, Boston, Hawaii, Chicago, and several renovated resorts were partly offset by declines at properties in New Orleans, Puerto Rico, and Orlando, as well as weaker EBITDA conversion at New York Hilton Midtown.
• Large renovation projects carry execution and stabilization risk. Park is spending heavily on Royal Palm, the Ali’i Tower, and other properties, making the timing and size of future revenue and EBITDA contributions important.
• Some external effects are excluded from guidance. Park did not quantify potential effects from tariffs, changing international travel patterns, foreign conflicts, policy reactions, or government shutdowns.

Summary

Park’s Q3 2026 results combined broad RevPAR growth and higher adjusted FFO with weaker GAAP operating income and only modest hotel-level margin expansion. Group and leisure room demand remained supportive, but higher operating costs and limited ancillary spending reduced profit conversion. The main issues to watch are whether fourth-quarter demand sustains the raised RevPAR outlook, whether renovated properties deliver their expected contributions, and how refinancing costs affect GAAP earnings and cash generation.