Key Highlights

  • Adjusted diluted EPS rose 23% to $2.21 from $1.80, while GAAP diluted EPS rose 4% to $1.73.
  • Net revenues were $1,101 million, up 5%, with Vacation Ownership revenue up 9% to $953 million.
  • Adjusted EBITDA was $283 million, up 6%, at a 25.7% margin.
  • 2026 adjusted EBITDA guidance is $1.070 billion to $1.085 billion, with gross VOI sales of $2.625 billion to $2.675 billion.
  • Management repurchased $75 million of stock in the quarter, and covenant leverage rose to 3.3 times after two acquisitions.

Travel + Leisure Earnings: Did Strong Timeshare Growth Outrun a Weaker Membership Business?

Travel + Leisure (NYSE:TNL) reported third-quarter results on Tuesday, October 27, with adjusted diluted EPS of $2.21, up 23% from $1.80 a year earlier. GAAP diluted EPS was $1.73, up 4% from $1.67,, against a screened estimate of $2.06 (as screened).

The gap between adjusted and GAAP earnings is the first thing to read. GAAP net income fell 3% to $108 million, while adjusted net income rose 16% to $138 million.

Vacation Ownership revenue grew 9% to $953 million, but Travel and Membership revenue fell 11% to $150 million.

Vacation Ownership Sales: Why Did VPG Slip While Tours Rose 7%?

Gross VOI sales were $720 million, up 6%, and net VOI sales were $545 million, up 10%. Tours rose 7% to 213,000, but volume per guest edged down 1% to $3,286 from $3,304.

Management attributed the VPG decline to the mix effect of recent acquisitions, which more than offset organic growth. Vacation Ownership adjusted EBITDA rose 8% to $250 million.

Travel and Membership adjusted EBITDA fell 12% to $51 million from $58 million. Management pointed to a growing share of exchange members with club affiliations, who transact less often, plus lower exchange transaction volume.

Cash Flow and Leverage: What Did the Yes& and Spinnaker Deals Cost?

Yes& Vacations and Spinnaker Resorts both closed in the third quarter, with about $350 million invested across the two deals. Covenant leverage rose to 3.3 times, which management tied to funding those purchases.

Nine-month operating cash flow was $388 million versus $516 million, and adjusted free cash flow $254 million versus $326 million.

Cash was $306 million. After quarter-end, the company completed a $300 million term securitization at a weighted average coupon of 6.18% and a 98% advance rate.

Buybacks and Guidance: What Do the 2026 Ranges Imply for the Fourth Quarter?

The company repurchased about 1.1 million shares for $75 million in the third quarter, at an average price of $71.45. Year to date it bought 3.5 million shares for $250 million, leaving $671 million of authorization. Management plans to recommend a $0.60 fourth-quarter dividend, subject to board approval in November.

Full-year adjusted EBITDA guidance is $1.070 billion to $1.085 billion, up from $1.065 billion to $1.085 billion after the second quarter. Gross VOI sales are guided to $2.625 billion to $2.675 billion, from $2.600 billion to $2.675 billion, and VPG remains $3,325 to $3,375. The full-year figures imply roughly $293 million to $308 million of fourth-quarter adjusted EBITDA (calculated).

Management said demand remains healthy. A 17-resort optimization review is still expected to help 2026 adjusted EBITDA.

What to Watch Next: Can Integration Lift VPG and Pull Leverage Back Down?

Investors will track whether VPG recovers as acquired owners are integrated, whether Travel and Membership stabilizes, and how fast leverage eases from 3.3 times. The November board decision on the dividend is the next dated checkpoint.