Park Hotels & Resorts Inc. 10-Q

Item 1. Financial Statements. PARK HOTELS & RESORTS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in millions, except share and per share data) September 30, 2025 December 31, 2024 (unaudited) ASSETS Property and equipment, net $ 7,174 $ 7,398 Contract asset 868 820 Intangibles, net 41 41 Cash and cash equivalents 278 402 Restricted cash 31 38 Accounts receivable, net of allowance for doubtful accounts of $ 3 and $ 4 124 131 Prepaid expenses 55 69 Other assets 78 71 Operating lease right-of-use assets 181 191 TOTAL ASSETS (variable interest entities – $ 209 and $ 223 ) $ 8,830 $ 9,161 LIABILITIES AND EQUITY Liabilities Debt $ 3,839 $ 3,841 Debt associated with hotels in receivership 725 725 Accrued interest associated with hotels in receivership 143 95 Accounts payable and accrued expenses 237 226 Dividends payable 56 138 Due to hotel managers 107 138 Other liabilities 182 179 Operating lease liabilities 215 225 Total liabilities (variable interest entities – $ 196 and $ 201 ) 5,504 5,567 Commitments and contingencies – refer to Note 12 Stockholders’ Equity 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 2 2 Additional paid-in capital 4,027 4,063 Accumulated deficit ( 647 ) ( 420 ) Total stockholders’ equity 3,382 3,645 Noncontrolling interests ( 56 ) ( 51 ) Total equity 3,326 3,594 TOTAL LIABILITIES AND EQUITY $ 8,830 $ 9,161 Refer to the notes to the unaudited condensed consolidated financial statements. 3 Table of Content s PARK HOTELS & RESORTS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in millions, except per share data) Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 Revenues Rooms $ 370 $ 403 $ 1,134 $ 1,193 Food and beverage 150 157 512 521 Ancillary hotel 67 68 198 196 Other 23 21 68 64 Total revenues 610 649 1,912 1,974 Operating expenses Rooms 106 107 311 314 Food and beverage 112 112 357 356 Other departmental and support 148 154 451 454 Other property 56 65 163 174 Management fees 27 30 88 93 Impairment and casualty loss — — 70 13 Depreciation and amortization 78 63 269 192 Corporate general and administrative 17 17 54 52 Other 23 21 67 62 Total expenses 567 569 1,830 1,710 Gain on sale of assets, net — — 1 — Gain on derecognition of assets 16 15 48 44 Operating income 59 95 131 308 Interest income 3 6 8 16 Interest expense ( 53 ) ( 54 ) ( 158 ) ( 161 ) Interest expense associated with hotels in receivership ( 16 ) ( 15 ) ( 48 ) ( 44 ) Equity in earnings from investments in affiliates — 28 2 29 Other (loss) gain, net ( 1 ) ( 1 ) — ( 4 ) (Loss) income before income taxes ( 8 ) 59 ( 65 ) 144 Income tax (expense) benefit ( 6 ) ( 2 ) ( 8 ) 9 Net (loss) income ( 14 ) 57 ( 73 ) 153 Net income attributable to noncontrolling interests ( 2 ) ( 3 ) ( 5 ) ( 7 ) Net (loss) income attributable to stockholders $ ( 16 ) $ 54 $ ( 78 ) $ 146 (Loss) earnings per share: (Loss) earnings per share – Basic $ ( 0.08 ) $ 0.26 $ ( 0.40 ) $ 0.70 (Loss) earnings per share – Diluted $ ( 0.08 ) $ 0.26 $ ( 0.40 ) $ 0.69 Weighted average shares outstanding – Basic 199 206 199 208 Weighted average shares outstanding – Diluted 199 208 199 210 Refer to the notes to the unaudited condensed consolidated financial statements. 4 Table of Content s PARK HOTELS & RESORTS INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited, in millions) Nine Months Ended September 30, 2025 2024 Operating Activities: Net (loss) income $ ( 73 ) $ 153 Adjustments to reconcile net (loss) income to net cash provided by operating activities: Depreciation and amortization 269 192 Gain on sales of assets, net ( 1 ) — Gain on derecognition of assets ( 48 ) ( 44 ) Impairment loss 70 12 Equity in earnings from investments in affiliates ( 2 ) ( 29 ) Other loss, net 2 3 Share-based compensation expense 14 14 Amortization of deferred financing costs 6 6 Distributions from unconsolidated affiliates 4 4 Deferred income taxes 4 ( 13 ) Changes in operating assets and liabilities 48 51 Net cash provided by operating activities 293 349 Investing Activities: Capital expenditures for property and equipment ( 188 ) ( 164 ) Proceeds from asset dispositions, net 75 — Distributions from unconsolidated affiliates — 33 Contributions to unconsolidated affiliates — ( 3 ) Net cash used in investing activities ( 113 ) ( 134 ) Financing Activities: Proceeds from issuance of Senior Notes — 550 Repurchase or redemption of Senior Notes — ( 650 ) Borrowings from credit facilities — 200 Repayments of mortgage debt ( 6 ) ( 6 ) Debt issuance costs ( 16 ) ( 11 ) Dividends paid ( 230 ) ( 459 ) Distributions to noncontrolling interests, net ( 10 ) ( 6 ) Tax withholdings on share-based compensation ( 4 ) ( 5 ) Repurchase of common stock ( 45 ) ( 60 ) Net cash used in financing activities ( 311 ) ( 447 ) Net decrease in cash and cash equivalents and restricted cash ( 131 ) ( 232 ) Cash and cash equivalents and restricted cash, beginning of period 440 750 Cash and cash equivalents and restricted cash, end of period $ 309 $ 518 Supplemental Disclosures Non-cash investing and financing activities: Accrued capital expenditures $ 38 $ 27 Dividends declared but unpaid 50 51 Refer to the notes to the unaudited condensed consolidated financial statements. 5 Table of Content s PARK HOTELS & RESORTS INC. CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (unaudited, in millions) Common Stock Additional Paid-in Capital Accumulated Deficit Non- controlling Interests Total Shares Amount Balance as of December 31, 2024 203 $ 2 $ 4,063 $ ( 420 ) $ ( 51 ) $ 3,594 Share-based compensation, net 1 — ( 1 ) 1 — — Net loss — — — ( 57 ) — ( 57 ) Dividends and dividend equivalents (1) — — — ( 49 ) — ( 49 ) Distributions to noncontrolling interests — — — — ( 7 ) ( 7 ) Repurchase of common stock ( 4 ) — ( 45 ) — — ( 45 ) Balance as of March 31, 2025 200 2 4,017 ( 525 ) ( 58 ) 3,436 Share-based compensation, net — — 5 — — 5 Net (loss) income — — — ( 5 ) 3 ( 2 ) Dividends and dividend equivalents (1) — — — ( 50 ) — ( 50 ) Distributions to noncontrolling interests — — — — ( 1 ) ( 1 ) 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 Paid-in Capital Accumulated Deficit Non- controlling Interests Total Shares Amount Balance as of December 31, 2023 210 $ 2 $ 4,156 $ ( 344 ) $ ( 46 ) $ 3,768 Share-based compensation, net 1 — ( 2 ) 2 — — Net income — — — 28 1 29 Dividends and dividend equivalents (1) — — — ( 53 ) — ( 53 ) Distributions to noncontrolling interests — — — — ( 2 ) ( 2 ) Balance as of March 31, 2024 211 2 4,154 ( 367 ) ( 47 ) 3,742 Share-based compensation, net — — 4 — — 4 Net income — — — 64 3 67 Dividends and dividend equivalents (1) — — — ( 52 ) — ( 52 ) Repurchase of common stock ( 2 ) — ( 25 ) — — ( 25 ) 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 ) 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. 6 Table of Content s PARK HOTELS & RESORTS INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Note 1: Organization Park Hotels & Resorts Inc. (“we,” “us,” “our” or the “Company” and, exclusive of any subsidiaries, “Park Parent”) is a Delaware corporation that owns a portfolio of premium-branded hotels and resorts primarily located in prime city center and resort locations. On January 3, 2017, Hilton Worldwide Holdings Inc. (“Hilton”) completed the spin-off of a portfolio of premium hotels and resorts that established Park Hotels & Resorts Inc. as an independent, publicly traded company. On September 18, 2019, we acquired Chesapeake Lodging Trust. We are a real estate investment trust (“REIT”) for United States (“U.S.”) federal income tax purposes. We have been organized and operated, and we expect to continue to be organized and operate, in a manner to qualify as a REIT. To qualify as a REIT, we must satisfy requirements related to, among other things, the real estate qualification of sources of our income, the real estate composition and values of our assets, the amounts we distribute to our stockholders annually and the diversity of ownership of our stock. From the date of our spin-off from Hilton, Park Intermediate Holdings LLC (our “Operating Company”), directly or indirectly, has held all our assets and has conducted all of our operations. We are structured as a traditional umbrella partnership REIT (“UPREIT”). Park Parent is the managing member of our Operating Company and PK Domestic REIT Inc., a direct subsidiary of Park Parent, is a member of our Operating Company. We may, in the future, issue interests in (or from) our Operating Company in connection with acquiring hotels, financings, issuance of equity compensation or other purposes. Note 2: Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation Principles of Consolidation The unaudited condensed consolidated financial statements reflect our financial position, results of operations and cash flows, in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with U.S. GAAP. In our opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of the interim periods. All significant intercompany transactions and balances within the financial statements have been eliminated. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2024 included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on February 20, 2025. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Interim results are not necessarily indicative of full year performance. Summary of Significant Accounting Policies Our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 20, 2025, contains a discussion of significant accounting policies. There have been no significant changes to our significant accounting policies since December 31, 2024. 7 Table of Content s Recently Issued Accounting Pronouncements Accounting Standards Not Yet Adopted In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09 (“ASU 2023-09”), Income Taxes (Topic 740) - Improvements to Income Tax Disclosures, which enhances income tax disclosures, including disclosures about the existing rate reconciliation and income taxes paid information. We expect to adopt ASU 2023-09 on a prospective basis when the requirements become effective for the year-ended December 31, 2025. We are currently evaluating the effect that ASU 2023-09 will have on our consolidated financial statements. In November 2024, the FASB issued ASU No. 2024-03 (“ASU 2024-03”), Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) , which adds guidance on providing qualitative and quantitative disclosures about certain costs and expenses. Although early adoption is permitted, we expect to adopt ASU 2024-03 on a prospective basis when the requirements become effective for the year ended December 31, 2027. 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. Note 3: Dispositions In May 2025, we sold the Hyatt Centric Fisherman’s Wharf for gross proceeds of $ 80 million. We recognized a net gain of approximately $ 1 million, which is included in gain on sale of assets, net in our condensed consolidated statements of operations. In addition, we previously recognized an impairment loss for the Hyatt Centric Fisherman’s Wharf, refer to Note 7: “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. 8 Table of Content s Note 4: Property and Equipment Property and equipment were: September 30, 2025 December 31, 2024 (in millions) Land $ 2,985 $ 3,018 Buildings and leasehold improvements 5,814 5,989 Furniture and equipment 1,017 1,023 Construction-in-progress 183 152 9,999 10,182 Accumulated depreciation ( 2,825 ) ( 2,784 ) $ 7,174 $ 7,398 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. Note 5: Consolidated Variable Interest Entities (“VIEs”) and Investments in Affiliates Consolidated VIEs We consolidate VIEs that own two hotels. We are the primary beneficiary of these VIEs as we have the power to direct the activities that most significantly affect their economic performance. 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 available to settle the obligations of these entities. Our condensed consolidated balance sheets include the following assets and liabilities of these entities: September 30, 2025 December 31, 2024 (in millions) Property and equipment, net $ 182 $ 181 Cash and cash equivalents 19 34 Restricted cash 3 2 Accounts receivable, net 4 3 Prepaid expenses 1 3 Debt 184 186 Accounts payable and accrued expenses 9 10 Due to hotel manager — 3 Other liabilities 3 2 Unconsolidated Entities 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 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. 9 Table of Content s Note 6: Debt Debt balances and associated interest rates as of September 30, 2025 were: Principal balance as of Interest Rate at September 30, 2025 Maturity Date September 30, 2025 December 31, 2024 (in millions) HHV Mortgage Loan (1) 4.20 % November 2026 $ 1,275 $ 1,275 Other mortgage loans Average rate of 4.40 % 2026 to 2027 (2) 357 364 Revolver (3) SOFR + 2.00 % September 2029 — — 2024 Term Loan SOFR + 1.95 % (4) May 2027 200 200 2025 Delayed Draw Term Loan SOFR + 1.95 % January 2030 — — 2028 Senior Notes (5) 5.88 % October 2028 725 725 2029 Senior Notes (5) 4.88 % May 2029 750 750 2030 Senior Notes (5) 7.00 % February 2030 550 550 Finance lease obligations 7.04 % 2026 to 2028 1 1 3,858 3,865 Less: unamortized deferred financing costs and discount ( 19 ) ( 24 ) $ 3,839 $ 3,841 _____________________________________ (1) In October 2016, we entered into a $ 1.275 billion CMBS loan secured by the Hilton Hawaiian Village Waikiki Beach Resort (“HHV Mortgage Loan”). (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 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, 10 Table of Content s 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 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) 2025 $ 53 2026 1,550 2027 230 2028 725 2029 750 Thereafter 550 $ 3,858 Debt Associated with Hotels in Receivership 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 %; however, beginning June 1, 2023, the default interest rate on the loan is 7.11 %. Additionally, beginning June 1, 2023, the loan accrues a monthly late payment administrative fee of 3 % of the monthly amount due. In October 2023, the trustee for the SF Mortgage Loan filed a lawsuit against the borrowers under the SF Mortgage Loan. 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 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 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 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. 11 Table of Content s Note 7: Fair Value Measurements We did not elect the fair value measurement option for our financial assets or liabilities. The fair values of our other financial instruments not included in the table below are estimated to be equal to their carrying amounts. The fair value of our debt and the hierarchy level we used to estimate fair values are shown below: September 30, 2025 December 31, 2024 Hierarchy Level Carrying Amount Fair Value Carrying Amount Fair Value (in millions) Liabilities: HHV Mortgage Loan 3 $ 1,275 $ 1,239 $ 1,275 $ 1,212 Other mortgage loans 3 357 351 364 349 2024 Term Loan 3 200 199 200 199 2028 Senior Notes 1 725 725 725 712 2029 Senior Notes 1 750 730 750 706 2030 Senior Notes 1 550 567 550 559 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 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: September 30, 2025 (1) September 30, 2024 (2) Fair Value Impairment Loss Fair Value Impairment Loss (in millions) Property and equipment $ 74 $ 70 $ 2 $ 12 Total $ 74 $ 70 $ 2 $ 12 ____________________________________________________________________________________ (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 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). 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. Note 8: Income Taxes We are a REIT for U.S. federal income tax purposes. We have been organized and operated, and we expect to continue to be organized and operate in a manner to qualify as a REIT. To qualify as a REIT, we must satisfy requirements related to, among other things, the real estate qualification of sources of our income, the real estate composition and values of our assets, the amounts we distribute to our stockholders annually and the diversity of ownership of our stock. To the extent we continue to remain qualified as a REIT, we generally will not be subject to U.S. federal (and state) income tax on taxable income generated by our REIT activities that we distribute annually to our stockholders. Accordingly, no provision for U.S. 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. federal, state and local, and foreign income taxes (as applicable). 12 Table of Content s 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. Note 9: 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 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 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 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 nine months ended September 30, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at January 1, 2025 1,009,671 $ 15.66 Granted 858,221 12.27 Vested ( 547,634 ) 15.58 Forfeited ( 39,855 ) 14.01 Unvested at September 30, 2025 1,280,403 $ 13.47 Performance Stock Units Performance Stock Units (“PSUs”) generally vest at the end of a three-year performance period and are subject to the achievement of a market condition based on a measure of our total shareholder return relative to the total shareholder return of the companies that comprise the FTSE Nareit Lodging Resorts Index (that have a market capitalization in excess of $ 1 billion as of the first day of the applicable performance period). 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 nine months ended September 30, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at January 1, 2025 1,516,571 $ 19.43 Granted 758,610 11.18 Vested ( 381,857 ) 21.93 Forfeited ( 12,037 ) 16.52 Unvested at September 30, 2025 1,881,287 $ 15.62 13 Table of Content s The grant date fair values of the awards that are subject to the achievement of market conditions based on total shareholder return were determined using a Monte Carlo simulation valuation model with the following assumptions: Expected volatility (1) 33.0 % Dividend yield (2) — Risk-free rate (3) 4.4 % Expected term 3 years _____________________________________ (1) Estimated using a blended approach of historical and implied volatility. Historical volatility is based on the historical movement of the Company’s stock price for a period that corresponds to the expected terms of the PSUs. (2) Dividends are assumed to be reinvested in shares of our common stock and dividends will not be paid unless shares vest. (3) Based on the yields of U.S. Department of Treasury instruments with similar expected terms of the PSUs at the grant date of each award. Note 10: Earnings Per Share The following table presents the calculation of basic and diluted earnings per share (“EPS”): Three Months Ended September 30, Nine Months Ended September 30, 2025 2024 2025 2024 (in millions, except per share amounts) Numerator: 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 Denominator: Weighted average shares outstanding – basic 199 206 199 208 Unvested restricted shares — 2 — 2 Weighted average shares outstanding – diluted 199 208 199 210 (Loss) earnings per share – Basic (1) $ ( 0.08 ) $ 0.26 $ ( 0.40 ) $ 0.70 (Loss) earnings per share – Diluted (1) $ ( 0.08 ) $ 0.26 $ ( 0.40 ) $ 0.69 _____________________________________ (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 nine months ended September 30, 2025 and 2024 because their effect would have been anti-dilutive. 14 Table of Content s Note 11: Business Segment Information 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. Our Chief Operating Decision Maker (the “CODM”), who is our chief executive officer, evaluates our consolidated hotels primarily based on hotel adjusted earnings (loss) before interest income and expense, taxes and depreciation and amortization (“EBITDA”) when deciding how to allocate resources, in making other day-to-day operating decisions and evaluating our operating performance against other companies within our industry. Hotel Adjusted EBITDA, presented herein, is calculated as EBITDA from hotel operations, adjusted to exclude the following items that are not reflective of our ongoing operating performance or incurred in the normal course of business, and thus excluded from the CODM’s analysis: • Gains or losses on sales of assets for both consolidated and unconsolidated investments; • Costs associated with hotel acquisitions or dispositions expensed during the period; • Severance expense; • Share-based compensation expense; • Impairment losses and casualty gains or losses; and • Other items that we believe are not representative of our current or future operating performance. 15 Table of Content s 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 September 30, Nine Months Ended September 30, 2025 2024 2025 2024 (in millions) Revenues: Total revenues $ 610 $ 649 $ 1,912 $ 1,974 Less: Other revenues ( 23 ) ( 21 ) ( 68 ) ( 64 ) Total segment revenues 587 628 1,844 1,910 Less: Rooms expense 106 107 311 314 Food and beverage expense 112 112 357 356 Other departmental and support expense 148 154 451 454 Management fees 27 30 88 93 Other property segment expenses (1) 53 57 154 157 Total segment expenses 446 460 1,361 1,374 Hotel Adjusted EBITDA 141 168 483 536 Other revenues 23 21 68 64 Depreciation and amortization expense ( 78 ) ( 63 ) ( 269 ) ( 192 ) Corporate general and administrative expense ( 17 ) ( 17 ) ( 54 ) ( 52 ) Impairment and casualty loss — — ( 70 ) ( 13 ) Other operating expenses ( 23 ) ( 21 ) ( 67 ) ( 62 ) Gain on sales of assets, net — — 1 — Gain on derecognition of assets 16 15 48 44 Interest income 3 6 8 16 Interest expense ( 53 ) ( 54 ) ( 158 ) ( 161 ) Interest expense associated with hotels in receivership ( 16 ) ( 15 ) ( 48 ) ( 44 ) Equity in earnings from investments in affiliates — 28 2 29 Income tax (expense) benefit ( 6 ) ( 2 ) ( 8 ) 9 Other (loss) gain, net ( 1 ) ( 1 ) — ( 4 ) Other items ( 3 ) ( 8 ) ( 9 ) ( 17 ) Net (loss) income $ ( 14 ) $ 57 $ ( 73 ) $ 153 ___________________________________________________________________________________ (1) Other property segment expenses primarily include real and personal property taxes, other local taxes, ground rent, equipment rent and property insurance incurred in the normal course of business. The following table presents total assets for our consolidated hotels, reconciled to total assets: September 30, 2025 December 31, 2024 (in millions) Consolidated hotels $ 8,823 $ 9,153 All other 7 8 Total assets $ 8,830 $ 9,161 16 Table of Content s Note 12: Commitments and Contingencies 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. If cancellation of a contract occurred, our commitment would be any costs incurred up to the cancellation date, in addition to any costs associated with the discharge of the contract. We are involved in litigation arising from the normal course of business, some of which includes claims for substantial sums, and may make certain indemnifications or guarantees to select buyers of our hotels as part of a sale process. We are also involved in claims and litigation that is not in the ordinary course of business in connection with the spin-off from Hilton. The spin-off agreements provide that Hilton will indemnify us from certain of these claims as well as require us to indemnify Hilton for other claims. 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 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. 17 Table of Content s