What changed in this filing

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Item 1. Financial Statements

2025-11-03 compared with 2025-08-01 · 105 added, 61 removed, 406 unchanged (29% of the section changed)

3 unchanged sentences

(in millions, except share and per share data)

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Property and equipment, net $ 7,174 $ 7,398

21 unchanged sentences

Stockholders’ Equity

Common stock, par value $ 0.01 per share, 6,000,000,000 shares authorized, 200,946,918 shares issued and 199,913,166 shares outstanding as of June 30, 2025 and 203,407,320 shares issued and 202,553,194 shares outstanding as of December 31, 2024

Common stock, par value $ 0.01 per share, 6,000,000,000 shares authorized, 200,945,761 shares issued and 199,911,257 shares outstanding as of September 30, 2025 and 203,407,320 shares issued and 202,553,194 shares outstanding as of December 31, 2024

Additional paid-in capital 4,027 4,063

10 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

38 unchanged sentences

(unaudited, in millions)

Six Months Ended

Nine Months Ended

September 30,

Operating Activities:

16 unchanged sentences

Proceeds from asset dispositions, net 75 —

Distributions from unconsolidated affiliates — 33

Contributions to unconsolidated affiliates — ( 3 )

Net cash used in investing activities ( 113 ) ( 134 )

15 unchanged sentences

Non-cash investing and financing activities:

Dividends declared but unpaid $ 50 $ 52

Accrued capital expenditures $ 38 $ 27

Dividends declared but unpaid 50 51

Refer to the notes to the unaudited condensed consolidated financial statements.

21 unchanged sentences

Balance as of June 30, 2025 200 2 4,022 ( 580 ) ( 56 ) 3,388

Share-based compensation, net — — 5 — — 5

Net (loss) income — — — ( 16 ) 2 ( 14 )

Dividends and dividend equivalents (1)

— — — ( 51 ) — ( 51 )

Distributions to noncontrolling interests — — — — ( 2 ) ( 2 )

Balance as of September 30, 2025 200 $ 2 $ 4,027 $ ( 647 ) $ ( 56 ) $ 3,326

Common Stock Additional

15 unchanged sentences

Balance as of June 30, 2024 209 2 4,133 ( 355 ) ( 44 ) 3,736

Share-based compensation, net — — 5 — — 5

Net income — — — 54 3 57

Dividends and dividend equivalents (1)

— — — ( 52 ) — ( 52 )

(1) Dividends declared per common share were $ 0.25 for each of the three months ended March 31, 2025, June 30, 2025, March 31, 2024 and June 30, 2024.

Distributions to noncontrolling interests — — — — ( 4 ) ( 4 )

Repurchase of common stock ( 3 ) — ( 35 ) — — ( 35 )

Balance as of September 30, 2024 206 $ 2 $ 4,103 $ ( 353 ) $ ( 45 ) $ 3,707

___________________________________

(1) Dividends declared per common share were $ 0.25 for each of the three months ended March 31, 2025, June 30, 2025, September 30, 2025, March 31, 2024, June 30, 2024 and September 30, 2024.

Refer to the notes to the unaudited condensed consolidated financial statements.

43 unchanged sentences

We are currently evaluating the effect that ASU 2024-03 will have on our consolidated financial statements.

In September 2025, the FASB issued ASU No.

2025-06 (“ASU 2025-06”), Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) , which better aligns software cost accounting with how software is generally developed.

Although early adoption is permitted, we expect to adopt ASU 2025-06 when it becomes effective January 1, 2028 on either a prospective or modified transition approach, which considers the status of software projects that are in progress.

We are currently evaluating the effect that ASU 2025-06 will have on our consolidated financial statements.

In May 2025, we sold the Hyatt Centric Fisherman’s Wharf for gross proceeds of $ 80 million.

2 unchanged sentences

“Fair Value Measurements” for additional information.

Additionally, in September 2025, we permanently closed the Embassy Suites Kansas City Plaza and terminated its ground lease, returning the property to the ground lessor.

In July 2024, the unconsolidated joint venture that owned and operated the Hilton La Jolla Torrey Pines sold the hotel for gross proceeds of approximately $ 165 million, and our pro-rata share of the gross proceeds was approximately $ 41 million, which was reduced by our portion of debt of approximately $ 17 million.

We recognized a gain of approximately $ 19 million, which is included in equity in earnings from investments in affiliates in our condensed consolidated statements of operations.

Additionally, in August 2024, we permanently closed the Hilton Oakland Airport and terminated its ground lease, returning the property to the ground lessor.

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Property and Equipment

Property and equipment were:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions)

3 unchanged sentences

Construction-in-progress 183 152

10,044 10,182

Accumulated depreciation ( 2,825 ) ( 2,784 )

$ 7,174 $ 7,398

Depreciation of property and equipment was $ 122 million and $ 63 million during the three months ended June 30, 2025 and 2024, respectively, and $ 191 million and $ 128 million for the six months ended June 30, 2025 and 2024, respectively.

Depreciation expense for the three and six months ended June 30, 2025, compared to the same periods in 2024 includes accelerated depreciation recognized in connection with the full-scale renovation at the Royal Palm South Beach Miami, a Tribute Portfolio Resort, which began in May 2025.

Depreciation of property and equipment was $ 77 million and $ 63 million during the three months ended September 30, 2025 and 2024, respectively, and $ 268 million and $ 191 million for the nine months ended September 30, 2025 and 2024, respectively.

Depreciation expense for the three and nine months ended September 30, 2025 includes accelerated depreciation recognized in connection with renovations at certain of our hotels, including the Royal Palm South Beach Miami, a Tribute Portfolio Resort, which began in May 2025.

Consolidated Variable Interest Entities (“VIEs”) and Investments in Affiliates

3 unchanged sentences

Additionally, we have the obligation to absorb their losses and the right to receive benefits that could be significant to them.

The assets of our VIEs are only

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available to settle the obligations of these entities.

The assets of our VIEs are only available to settle the obligations of these entities.

Our condensed consolidated balance sheets include the following assets and liabilities of these entities:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions)

9 unchanged sentences

Three of our hotels are owned by unconsolidated joint ventures in which we hold an interest.

These hotels are accounted for using the equity method and had total debt of approximately $ 684 million and $ 685 million as of June 30, 2025 and December 31, 2024, respectively.

These hotels are accounted for using the equity method and had total debt of approximately $ 684 million and $ 685 million as of September 30, 2025 and December 31, 2024, respectively.

Substantially all the debt is secured solely by the affiliates’ assets or is guaranteed by other partners without recourse to us.

Debt balances and associated interest rates as of June 30, 2025 were:

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Debt balances and associated interest rates as of September 30, 2025 were:

Principal balance as of

Interest Rate

at June 30, 2025 Maturity Date June 30, 2025 December 31, 2024

at September 30, 2025 Maturity Date September 30, 2025 December 31, 2024

(in millions)

5 unchanged sentences

SOFR + 2.00 %

December 2026 — —

September 2029 — —

2024 Term Loan

1 unchanged sentence

May 2027 200 200

2025 Delayed Draw Term Loan

SOFR + 1.95 %

January 2030 — —

2028 Senior Notes (5)

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(2) Assumes the exercise of all extensions that are exercisable solely at our option.

The mortgage loan for Hilton Denver City Center matures in 2042 but is callable by the lender with six months notice.

As of June 30, 2025, we did not receive notice from the lender.

(3) Our revolving credit facility (“Revolver”) permits one or more standby letters of credit, up to a maximum aggregate outstanding balance of $ 50 million, to be issued on behalf of us.

As of June 30, 2025, we had $ 950 million of available capacity under our Revolver and no outstanding letters of credit.

(4) The secured overnight financing rate (“SOFR”) includes a credit spread adjustment of 0.1 %.

As of June 30, 2025, our all-in interest rate for borrowing under the 2024 Term Loan was 6.37 %.

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(5) In May 2024, the Company, our Operating Company, and PK Domestic Property LLC, an indirect subsidiary of the Company (“PK Domestic”), amended our existing credit agreement to include a new $ 200 million senior unsecured term loan (“2024 Term Loan”).

(6) Our Operating Company, PK Domestic and PK Finance Co-Issuer Inc.

The mortgage loan for Hilton Denver City Center matures in 2042 but became callable by the lender in August 2022 with six months notice.

As of September 30, 2025, we had not received notice from the lender.

(3) Our senior unsecured revolving credit facility (“Revolver”) permits one or more standby letters of credit, up to a maximum aggregate outstanding balance of $ 50 million, to be issued on behalf of us.

As of September 30, 2025, we had $ 1 billion of available capacity under our Revolver and no outstanding letters of credit.

(4) As of September 30, 2025, our all-in interest rate for the $ 200 million senior unsecured term loan (“2024 Term Loan”) was 6.09 %.

(5) Our Operating Company, PK Domestic Property LLC, an indirect subsidiary of the Company (“PK Domestic”), and PK Finance Co-Issuer Inc.

(“PK Finance”) issued an aggregate of $ 725 million of senior notes due 2028 (“2028 Senior Notes”) in September 2020, an aggregate of $ 750 million of senior notes due 2029 (“2029 Senior Notes”) in May 2021 and an aggregate of $ 550 million of senior notes due 2030 (“2030 Senior Notes”) in May 2024.

Credit Facilities

Revolver, 2024 Term Loan and 2025 Delayed Draw Term Loan

In September 2025, the Company and our Operating Company entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) which provides for an increase in the aggregate commitments for the Revolver from $ 950 million to $ 1 billion, a new $ 800 million senior unsecured delayed draw term loan facility (“2025 Delayed Draw Term Loan”), which allows for up to three draws through September 17, 2026, and the continuation of the 2024 Term Loan.

The Credit Agreement extended the Revolver’s maturity date to September 17, 2029, with an option to extend its maturity by one year as either (i) a one-year extension or (ii) two six-month extensions.

The 2025 Delayed Draw Term Loan matures on January 2, 2030, with an option to extend its maturity by an additional one-year period.

The maturity date of the 2024 Term Loan remains May 14, 2027.

The Credit Agreement includes the option to increase the Revolver and increase or add new term loans under the Credit Agreement by up to $ 1 billion in the aggregate, subject to obtaining additional lender commitments and the satisfaction of certain customary conditions.

Borrowings under the Revolver, the 2024 Term Loan and the 2025 Delayed Draw Term Loan bear interest based upon the secured overnight financing rate (“SOFR”), plus an applicable margin based on our leverage ratio.

The Credit Agreement removed the previous credit spread adjustment on the Revolver and the 2024 Term Loan of 0.10 %.

We are subject to fees between 0.20 % and 0.25 % based on unused commitments under the Revolver,

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as well as a 0.25 % ticking fee on the undrawn portion of the 2025 Delayed Draw Term Loan.

As of September 30, 2025, there were no borrowings outstanding under the Revolver or the 2025 Delayed Draw Term Loan.

The Credit Agreement generally maintained the financial covenants under our existing credit agreement, including a maximum leverage ratio, minimum fixed charge coverage ratio, maximum secured leverage ratio, maximum unsecured indebtedness to unencumbered asset value ratio and minimum unencumbered adjusted net operating income to unsecured interest coverage ratio.

During the three and nine months ended September 30, 2025, we capitalized $ 8 million of financing fees incurred related to the Revolver and $ 8 million related to the 2025 Delayed Draw Term Loan.

We will begin amortizing financing fees for the 2025 Delayed Draw Term Loan when drawn upon.

Debt Maturities

The contractual maturities of our debt, excluding the $ 725 million non-recourse CMBS loan (“SF Mortgage Loan”) secured by two of our San Francisco hotels – the 1,921-room Hilton San Francisco Union Square and the 1,024-room Parc 55 San Francisco – a Hilton Hotel (collectively, the “Hilton San Francisco Hotels”) and assuming the exercise of all extensions that are exercisable solely at our option, as of June 30, 2025 were:

The contractual maturities of our debt, excluding debt associated with hotels in receivership, and assuming the exercise of all extensions that are exercisable solely at our option, as of September 30, 2025 were:

Year (in millions)

1 unchanged sentence

Debt Associated with Hotels in Receivership

In June 2023, we ceased making debt service payments towards the SF Mortgage Loan secured by the Hilton San Francisco Hotels, which was due November 2023, and we received a notice of default from the servicer.

In June 2023, we ceased making debt service payments towards the $ 725 million non-recourse CMBS loan (“SF Mortgage Loan”) secured by two of our San Francisco hotels – the 1,921-room Hilton San Francisco Union Square and the 1,024-room Parc 55 San Francisco – a Hilton Hotel (collectively, the “Hilton San Francisco Hotels”).

The SF Mortgage Loan was due November 2023, and we received a notice of default from the servicer.

The stated rate on the loan is 4.11 %;

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In connection with the lawsuit, the court appointed a receiver to take control of the Hilton San Francisco Hotels, which serve as security for the SF Mortgage Loan, and their operations, and thus, we have no further economic interest in the operations of the hotels.

The receiver operates and has authority over the hotels.

The receiver also had the ability to sell the hotels until March 31, 2025;

however, the deadline was extended and in July 2025, a purchase and sale agreement to consummate the sale of the hotels has been executed with a closing expected by October 29, 2025.

If the hotels are not sold to the buyer by October 29, 2025, the receivership will end with a non-judicial foreclosure as soon as permissible under California law.

The receiver operates and has authority over the Hilton San Francisco Hotels, and also has the ability to sell the hotels.

The receiver has executed an agreement to sell the hotels, and the court has approved the transaction with a closing expected by November 21, 2025.

If the hotels are not sold to the buyer by November 21, 2025, the receivership will end with a non-judicial foreclosure as soon as permissible under California law.

We derecognized the Hilton San Francisco Hotels from our consolidated balance sheet in October 2023 when the receiver took control of the hotels.

During the three and six months ended June 30, 2025, we recognized a gain of $ 16 million and $ 32 million, respectively, and during the three and six months ended June 30, 2024, we recognized a gain of $ 15 million and $ 29 million, respectively, which are included in gain on derecognition of assets in our condensed consolidated statements of operations.

During the three and nine months ended September 30, 2025, we recognized a gain of $ 16 million and $ 48 million, respectively, and during the three and nine months ended September 30, 2024, we recognized a gain of $ 15 million and $ 44 million, respectively, which are included in gain on derecognition of assets in our condensed consolidated statements of operations.

The gain represents the accrued interest expense associated with the default of the SF Mortgage Loan, which results in a corresponding increase of the contract asset on our condensed consolidated balance sheets as we expect to be released from this obligation upon final resolution with the lender on the SF Mortgage Loan, in exchange for the transfer of ownership of the Hilton San Francisco Hotels.

As of June 30, 2025 and December 31, 2024, the contract asset on our condensed consolidated balance sheets was $ 852 million and $ 820 million, respectively.

The SF Mortgage Loan will remain a liability until final resolution with the lender is concluded, and thus, is included in debt associated with hotels in receivership on our condensed consolidated balance sheets.

As of September 30, 2025 and December 31, 2024, the contract asset on our condensed consolidated balance sheets was $ 868 million and $ 820 million, respectively.

The SF Mortgage Loan will remain a liability until final resolution with the lender, and thus, is included in debt associated with hotels in receivership on our condensed consolidated balance sheets.

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3 unchanged sentences

The fair value of our debt and the hierarchy level we used to estimate fair values are shown below:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Level Carrying

8 unchanged sentences

2030 Senior Notes 1 550 567 550 559

The fair value of the SF Mortgage Loan, which has a carrying value of $ 725 million as of both June 30, 2025 and December 31, 2024 and is categorized as Level 3 of the fair value hierarchy, was $ 718 million as of both June 30, 2025 and December 31, 2024.

The fair value of the SF Mortgage Loan, with a carrying value of $ 725 million as of both September 30, 2025 and December 31, 2024 and categorized as Level 3 of the fair value hierarchy, was $ 718 million as of both September 30, 2025 and December 31, 2024.

Refer to Note 6:

“Debt” for additional information.

During the six months ended June 30, 2025, we recognized an impairment loss of approximately $ 70 million related to the Hyatt Centric Fisherman’s Wharf, which was sold in May 2025, due to a change in our intent to hold the hotel and our inability to recover the carrying value of the asset.

During the three and six months ended June 30, 2024, we recognized impairment losses of approximately $ 7 million and $ 12 million, respectively, related to two of our hotels subject to ground leases and our inability to recover the carrying value of the assets over the remaining lease term.

During the nine months ended September 30, 2025, we recognized an impairment loss of approximately $ 70 million related to the Hyatt Centric Fisherman’s Wharf, which was sold in May 2025, due to a change in our intent to hold the hotel and our inability to recover the carrying value of the asset.

During the nine months ended September 30, 2024, we recognized an impairment loss of approximately $ 12 million, related to two of our hotels subject to ground leases and our inability to recover the carrying value of the assets over the remaining lease term.

The estimated fair value of the assets that were measured on a nonrecurring basis were:

June 30, 2025 (1)

June 30, 2024 (2)

September 30, 2025 (1)

September 30, 2024 (2)

Fair Value Impairment Loss Fair Value Impairment Loss

4 unchanged sentences

(1) We estimated the fair value of the asset using a discounted cash flow analysis, with an estimated stabilized growth rate of 3 %, a discounted cash flow term of 10 years, terminal capitalization rate of 7.3 % and a discount rate of 10.0 % (Level 3).

The discount and terminal capitalization rates used for the fair values of the assets reflect the risk profiles of the markets where the properties are located.

The discount and terminal capitalization rates used for the fair value of the asset reflect the risk profile of the market where the property is located.

(2) We estimated the fair value of the assets using a discounted cash flow analysis, with an estimated stabilized growth rate range of 2 % to 3 %, a discounted cash flow term of 10 years, and a discount rate ranging from 17.0 % to 20.0 % (Level 3).

7 unchanged sentences

Accordingly, no provision for U.S.

federal income taxes has been included in our accompanying condensed consolidated financial statements for the three or six months ended June 30, 2025 and 2024 related to our REIT activities.

federal income taxes has been included in our accompanying condensed consolidated financial statements for the three or nine months ended September 30, 2025 and 2024 related to our REIT activities.

Our taxable REIT subsidiaries (“TRSs”) are generally subject to U.S.

1 unchanged sentence

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During the three and six months ended June 30, 2024, we recognized an income tax benefit of $ 12 million and $ 11 million, respectively, which was primarily associated with the effective exit from the Hilton San Francisco Hotels and the reversal of $ 14 million of tax expense that is no longer expected to be incurred.

During the three and nine months ended September 30, 2025, we recognized income tax expense of $ 6 million and $ 8 million respectively, which was primarily related to taxable income from our TRSs.

During the three months ended September 30, 2024, we recognized income tax expense of $ 2 million, which was primarily related to taxable income from our TRSs.

During the nine months ended September 30, 2024, we recognized an income tax benefit of $ 9 million, which was primarily associated with the effective exit from the Hilton San Francisco Hotels and the reversal of $ 14 million of tax expense that is no longer expected to be incurred.

Share-Based Compensation

We issue equity-based awards to our employees pursuant to the 2017 Omnibus Incentive Plan (the “2017 Employee Plan”) and our non-employee directors pursuant to the 2017 Stock Plan for Non-Employee Directors (the “2017 Director Plan”), both of which are amended and restated from time to time.

The 2017 Employee Plan provides that a maximum of 14,070,000 shares of our common stock may be issued, and as of June 30, 2025, 5,240,519 shares of common stock remain available for future issuance.

The 2017 Employee Plan provides that a maximum of 14,070,000 shares of our common stock may be issued, and as of September 30, 2025, 5,243,921 shares of common stock remain available for future issuance.

An amendment and restatement of the 2017 Director Plan was approved by our stockholders in April 2025 to, among other changes, increase the number of shares available to be issued by 875,000 , from 950,000 to 1,825,000 .

As of June 30, 2025, 867,054 shares of common stock remain available for future issuance.

For both the three months ended June 30, 2025 and 2024, we recognized $ 5 million of share-based compensation expense and $ 9 million for both the six months ended June 30, 2025 and 2024.

As of June 30, 2025, unrecognized compensation expense was $ 28 million, which is expected to be recognized over a weighted-average period of 1.7 years.

The total fair value of shares vested (calculated as the number of shares multiplied by the vesting date share price) for the six months ended June 30, 2025 and 2024 was $ 12 million and $ 13 million, respectively.

As of September 30, 2025, 857,428 shares of common stock remain available for future issuance.

For both the three months ended September 30, 2025 and 2024, we recognized $ 5 million of share-based compensation expense and $ 14 million for both the nine months ended September 30, 2025 and 2024.

As of September 30, 2025, unrecognized compensation expense was $ 23 million, which is expected to be recognized over a weighted-average period of 1.5 years.

The total fair value of shares vested (calculated as the number of shares multiplied by the vesting date share price) for the nine months ended September 30, 2025 and 2024 was $ 12 million and $ 14 million, respectively.

Stock awards generally vest in annual installments between one and three years from each grant date.

The following table provides a summary of stock awards for the six months ended June 30, 2025:

The following table provides a summary of stock awards for the nine months ended September 30, 2025:

Number of Shares Weighted-Average

3 unchanged sentences

Forfeited ( 39,855 ) 14.01

Unvested at June 30, 2025 1,293,333 $ 13.48

Unvested at September 30, 2025 1,280,403 $ 13.47

Performance Stock Units

1 unchanged sentence

The number of PSUs that may become vested ranges from zero to 200 % of the number of PSUs granted to an employee, based on the level of achievement of the foregoing performance measure.

The following table provides a summary of PSUs for the six months ended June 30, 2025:

The following table provides a summary of PSUs for the nine months ended September 30, 2025:

Number of Shares Weighted-Average

3 unchanged sentences

Forfeited ( 12,037 ) 16.52

Unvested at June 30, 2025 1,886,128 $ 15.61

Unvested at September 30, 2025 1,881,287 $ 15.62

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12 unchanged sentences

The following table presents the calculation of basic and diluted earnings per share (“EPS”):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

(in millions, except per share amounts)

Net (loss) income attributable to stockholders $ ( 16 ) $ 54 $ ( 78 ) $ 146

Earnings attributable to participating securities — ( 1 ) — ( 1 )

Net (loss) income attributable to stockholders, net of earnings allocated to participating securities ( 16 ) 53 ( 78 ) 145

8 unchanged sentences

(1) Per share amounts are calculated based on unrounded numbers and are calculated independently for each period presented.

Certain of our outstanding equity awards were excluded from the above calculation of EPS for the three and six months ended June 30, 2025 and 2024 because their effect would have been anti-dilutive.

Certain of our outstanding equity awards were excluded from the above calculation of EPS for the three and nine months ended September 30, 2025 and 2024 because their effect would have been anti-dilutive.

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Business Segment Information

As of June 30, 2025, we have two operating segments, our consolidated hotels and unconsolidated hotels.

As of September 30, 2025, we have two operating segments, our consolidated hotels and unconsolidated hotels.

Our unconsolidated hotels operating segment does not meet the definition of a reportable segment, thus our consolidated hotels operating segment is our only reportable segment.

9 unchanged sentences

The following table presents our reportable segment revenues reconciled to our consolidated amounts, reportable segment expenses and Hotel Adjusted EBITDA reconciled to net (loss) income:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

29 unchanged sentences

The following table presents total assets for our consolidated hotels, reconciled to total assets:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions)

4 unchanged sentences

Commitments and Contingencies

As of June 30, 2025, we had outstanding commitments under third-party contracts of approximately $ 161 million for capital expenditures at our properties, of which $ 45 million relates to the transformative renovation at the Royal Palm South Beach Miami, a Tribute Portfolio Resort, $ 24 million relates to guestroom renovations at the Hilton Hawaiian Village Waikiki Beach Resort, $ 20 million relates to guestroom renovations at the Hilton Waikoloa Village, and $ 15 million relates to guestroom renovations at the Hilton New Orleans Riverside.

As of September 30, 2025, we had outstanding commitments under third-party contracts of approximately $ 128 million for capital expenditures at our properties, of which $ 25 million relates to the transformative renovation at the Royal Palm South Beach Miami, a Tribute Portfolio Resort, $ 21 million relates to guestroom renovations at the Hilton Hawaiian Village Waikiki Beach Resort, $ 15 million relates to guestroom renovations at the Hilton Waikoloa Village, and $ 9 million relates to guestroom renovations at the Hilton New Orleans Riverside.

Our contracts contain clauses that allow us to cancel all or some portion of the work.

4 unchanged sentences

In addition, losses related to certain contingent liabilities could be apportioned to us under the spin-off agreements.

In connection with our obligation to indemnify Hilton under the spin-off agreements, we have reserved approximately $ 8 million as of June 30, 2025 related to litigation with respect to an audit by the Australian Tax Office (“ATO”) of Hilton related to the sale of the Hilton Sydney in June 2015.

In connection with our obligation to indemnify Hilton under the spin-off agreements, we have reserved approximately $ 8 million as of September 30, 2025 related to litigation with respect to an audit by the Australian Tax Office (“ATO”) of Hilton related to the sale of the Hilton Sydney in June 2015.

This amount could change as the litigation of the ATO’s claim progresses.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements