What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-02-19 compared with 2024-02-21 · 418 added, 360 removed, 1332 unchanged (37% of the section changed)

34 unchanged sentences

Related Party Transactions 99

Subsequent Events 95

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

33 unchanged sentences

The Company generates vacation ownership contract receivables by extending financing to the purchasers of its vacation ownership interests.

The Company assesses the adequacy of the allowance for loan losses related to these vacation ownership interests using a technique referred to as a static pool model.

The model is based upon the historical performance of similar vacation ownership contract receivables and incorporates more recent history of default information.

Management prepares a static pool analysis to track defaults for each year’s sales over the entire life of the contract receivable as a means to project future losses.

A further qualitative assessment is also performed by the Company which considers whether any external economic conditions or internal portfolio characteristics exist which indicate an adjustment is necessary to reflect expected impacts on the contract receivable portfolio.

The Company assesses the adequacy of the allowance for loan losses related to these vacation ownership interests using a technique referred to as a static pool analysis.

The analysis is based upon the historical performance of similar vacation ownership contract receivables and incorporates more recent history of default information.

Management prepares a model to track defaults for each year’s sales over the entire life of the contract receivable as a means to project future losses.

A qualitative assessment is also performed by the Company which considers whether any external economic conditions or internal portfolio characteristics indicate an adjustment is necessary to reflect expected impacts on the contract receivable portfolio.

Given the level of difficulty required to accurately predict losses over the life of the contract receivables, including the determination of any qualitative adjustments, auditing the allowance for loan losses involved especially complex and subjective judgements.

1 unchanged sentence

Our audit procedures related to the vacation ownership interest allowance for loan loss included the following, among others:

• We tested the effectiveness of controls over the Company’s static pool model, historical loss data, and the calculation of a loss rate.

• We tested the design and operating effectiveness of controls over the Company’s static pool model, stress model, look-back analysis, historical loss data, and the calculation of a loss rate.

• We evaluated the qualitative adjustment to the historical loss rates, including assessing the basis for the adjustments and the reasonableness of the significant assumptions for the static pool model.

1 unchanged sentence

• We performed our own independent analyses using alternative assumptions to assess the reasonableness of the specific allowance models used by the Company.

• We evaluated the predictability of the Company’s models through analyzing the results of a look-back analysis.

• We evaluated the predictability of the Company’s model through analyzing the results of a look-back analysis.

/s/ Deloitte & Touche LLP

7 unchanged sentences

2024 2023 2022

Service and membership fees $ 1,649 $ 1,611 $ 1,502

Vacation ownership interest sales $ 1,721 $ 1,582 $ 1,484

Service and membership fees 1,607 1,649 1,611

Consumer financing 450 427 406

2 unchanged sentences

Operating 1,744 1,684 1,603

Cost of vacation ownership interests 133 157 157

Consumer financing interest 112 79 81

Marketing 550 507 451

General and administrative 475 454 479

Consumer financing interest 136 112 79

Depreciation and amortization 115 112 119

Cost of vacation ownership interests 92 133 157

Restructuring 16 26 14

Asset impairments/(recoveries), net — 10 ( 5 )

Asset impairments, net 3 — 10

COVID-19 related costs — — 2

3 unchanged sentences

Interest expense 249 251 195

Other (income), net ( 3 ) ( 22 ) ( 6 )

Interest (income) ( 14 ) ( 13 ) ( 6 )

Other (income), net ( 15 ) ( 3 ) ( 22 )

Income before income taxes 513 485 486

1 unchanged sentence

Net income from continuing operations 378 391 356

Gain/(loss) on disposal of discontinued business, net of income taxes 5 1 ( 5 )

Gain on disposal of discontinued business, net of income taxes 33 5 1

Net income attributable to Travel + Leisure Co.

18 unchanged sentences

Defined benefit pension plans, net of tax — 1 —

Other comprehensive gain/(loss), net of tax 9 ( 31 ) ( 32 )

Other comprehensive (loss)/income, net of tax ( 42 ) 9 ( 31 )

Comprehensive income attributable to Travel + Leisure Co.

44 unchanged sentences

Net income $ 411 $ 396 $ 357

(Gain)/loss on disposal of discontinued business, net of income taxes

( 5 ) ( 1 ) 5

Gain on disposal of discontinued business, net of income taxes ( 33 ) ( 5 ) ( 1 )

Adjustments to reconcile net income to net cash provided by operating activities:

2 unchanged sentences

Stock-based compensation 41 38 45

Deferred income taxes 26 8 ( 4 )

Non-cash interest 25 22 19

Non-cash lease expense 12 16 16

Deferred income taxes 8 ( 4 ) ( 39 )

Asset impairments, net 3 — 10

Loss on sale of business — 2 —

Asset impairments/(recoveries), net — 10 ( 5 )

Other, net ( 1 ) ( 3 ) 8

10 unchanged sentences

Property and equipment additions ( 81 ) ( 74 ) ( 52 )

Acquisitions ( 6 ) ( 2 ) ( 37 )

Proceeds from asset sales — 8 —

Acquisitions, net of cash acquired ( 44 ) ( 6 ) ( 2 )

Proceeds from sale of assets 1 — 8

Other, net ( 1 ) — 1

Net cash used in investing activities - continuing operations ( 125 ) ( 80 ) ( 45 )

Net cash used in investing activities - discontinued operations — ( 5 ) —

Net cash provided by/(used in) investing activities - discontinued operations 1 — ( 5 )

Net cash used in investing activities ( 124 ) ( 80 ) ( 50 )

5 unchanged sentences

Proceeds from notes issued and term loan — 299 293

Repayment of notes ( 405 ) ( 3 ) ( 903 )

Repayment of notes and term loans ( 307 ) ( 405 ) ( 3 )

Repurchase of common stock ( 234 ) ( 309 ) ( 351 )

5 unchanged sentences

Proceeds from issuance of common stock 15 9 10

Net cash used in by financing activities ( 500 ) ( 196 ) ( 1,288 )

Net cash used in financing activities ( 458 ) ( 500 ) ( 196 )

Effect of changes in exchange rates on cash, cash equivalents and restricted cash ( 11 ) — ( 5 )

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Other comprehensive loss — — — — — ( 31 ) — ( 31 )

Stock option exercises 0.1 — — 4 — — — 4

Issuance of shares for RSU vesting 0.4 — — — — — — —

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Dividends ($1.60 per share) — — — — ( 136 ) — — ( 136 )

Non-controlling interest ownership change — — — — — — 2 2

Other — — — 3 — — — 3

Balance as of December 31, 2022 78.4 2 ( 6,886 ) 4,242 1,808 ( 79 ) 9 ( 904 )

Net income — — — — 396 — — 396

Other comprehensive loss — — — — — ( 31 ) — ( 31 )

Other comprehensive income — — — — — 9 — 9

Issuance of shares for RSU vesting 0.6 — — — — — — —

8 unchanged sentences

Net income — — — — 411 — — 411

Other comprehensive income — — — — — 9 — 9

Issuance of shares for RSU vesting 0.6 — — — — — — —

Other comprehensive loss — — — — — ( 42 ) — ( 42 )

Stock option exercises 0.2 — — 6 — — — 6

Issuance of shares for RSU/PSU vesting 0.5 — — — — — — —

Net share settlement of stock-based compensation — — — ( 9 ) — — — ( 9 )

3 unchanged sentences

Dividends ($2.00 per share) — — — — ( 144 ) — — ( 144 )

Non-controlling interest ownership change — — — — — — ( 8 ) ( 8 )

Other — — ( 2 ) 2 — — — —

10 unchanged sentences

The Vacation Ownership segment develops, markets, and sells vacation ownership interests (“VOIs”) to individual consumers, provides consumer financing in connection with the sale of VOIs, and provides property management services at resorts.

This segment is substantially comprised of the Wyndham Destinations business line.

This segment is wholly comprised of the Vacation Ownership business line.

The Travel and Membership segment operates a variety of travel businesses, including vacation exchange brands, travel technology platforms, travel memberships, and direct-to-consumer rentals.

58 unchanged sentences

Vacation ownership contract receivables

In the Vacation Ownership segment, the Company provides for estimated VOCR defaults at the time of VOI sales by recording a provision for loan losses as a reduction of Vacation ownership interest sales on the Consolidated Statements of Income and establishing an allowance for loan loss which is reflected as a reduction to Vacation ownership contract receivables, net on the Consolidated Balance Sheets.

The Company assesses the adequacy of the allowance for loan losses related to these VOIs using a technique referred to as a static pool analysis.

6 unchanged sentences

The Company applies the relative sales value method for relieving VOI inventory and recording the related cost of sales.

Under the relative sales value method, cost of sales is recorded using a percentage ratio of total estimated development cost and VOI revenue, including estimated future revenue, incorporating factors such as changes in prices and the recovery of VOIs, generally as a result of contract receivable defaults.

receivable defaults.

The effect of such changes in estimates under the relative sales value method is accounted for in each period as a current-period adjustment to inventory and cost of sales.

Inventory is stated at the lower of cost, including

capitalized interest, property taxes, and certain other carrying costs incurred during the construction process, or estimated fair value less costs to sell.

Inventory is stated at the lower of cost, including capitalized interest, property taxes, and certain other carrying costs incurred during the construction process, or estimated fair value less costs to sell.

There was no capitalized interest applied to inventory during 2024, 2023, or 2022.

3 unchanged sentences

Amortization of leasehold improvements, also recorded as a component of Depreciation and amortization, is computed utilizing the straight-line method over the lesser of the estimated benefit period of the related assets or the lease terms.

Useful lives are generally 30 years for buildings, up to 20 years for leasehold improvements, up to 30 years for vacation rental properties, and range from three to seven years for furniture, fixtures and equipment.

Useful lives are generally 30 years for buildings, up to 20 years for leasehold improvements, up to 30 years for vacation rental properties, and range from two to seven years for furniture, fixtures and equipment.

The Company capitalizes the costs of software developed for internal use in accordance with the guidance for accounting for costs of computer software developed or obtained for internal use.

3 unchanged sentences

The net carrying value of software developed or obtained for internal use was $ 156 million and $ 147 million as of December 31, 2024 and 2023.

Capitalized interest was less than $ 1 million, $ 1 million, and less than $ 1 million during 2023, 2022, and 2021.

Capitalized interest was $ 1 million, less than $ 1 million, and $ 1 million during 2024, 2023, and 2022.

DERIVATIVE INSTRUMENTS

2 unchanged sentences

All derivatives are recorded at fair value either as assets or liabilities.

Changes in fair value of derivatives not designated as hedging instruments and of derivatives designated as fair value hedging instruments are recognized in Operating income and net interest expense, based upon the nature of the hedged item, on the Consolidated Statements of Income.

Changes in fair value of derivatives not designated as hedging instruments and of derivatives designated as fair value hedging instruments are recognized in Operating income or net interest expense, based upon the nature of the hedged item, on the Consolidated Statements of Income.

Changes in fair value of derivatives designated as cash flow hedging instruments are recorded as components of other comprehensive income.

14 unchanged sentences

STOCK-BASED COMPENSATION

The Company measures all stock-based compensation awards using a fair value method and records the related expense within General and administrative expenses on its Consolidated Statements of Income.

The Company measures all stock-based compensation awards using a fair value method.

These expenses are recognized on a straight-line basis over the requisite service period, and forfeitures are recognized as they occur.

The Company’s stock-based compensation expense is included within General and administrative expenses on its Consolidated Statements of Income.

LONG-LIVED ASSETS

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Goodwill and other intangible assets with indefinite lives are not subject to amortization.

However, goodwill and other intangibles with indefinite lives are subject to fair value-based rules for measuring impairment, and resulting write-downs, if any, are reflected in Asset impairments/(recoveries), net on the Consolidated Statements of Income.

The Company has goodwill recorded at reporting units comprising its Vacation Ownership and Travel and Membership reportable segments.

2 unchanged sentences

This analysis is performed by comparing the respective carrying values of the assets to the current and expected future cash flows, on an undiscounted basis, to be generated from such assets.

Property and equipment is evaluated separately within each segment.

Property and equipment are evaluated separately within each segment.

If such analysis indicates that the carrying value of these assets is not recoverable, the carrying value of such assets is reduced to fair value.

13 unchanged sentences

Among other updates, amendments specific to the Company include updates to disclosure requirements related to derivative instruments, diluted earnings per share, commitments, and amounts and terms of unused lines of credit.

The effective date for each amendment will be the date on which the Securities and Exchange Commission’s (“SEC’s”) removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

The Company is currently evaluating the impact of the adoption of this guidance on its financial statements and related disclosures.

Segment Reporting.

In November 2023, the FASB issued guidance to enhance segment disclosures by requiring incremental segment information on an annual and interim basis for all public entities.

Among other provisions, this guidance will require public entities to disclose significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss.

This guidance is effective for all public entities for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The Company is currently evaluating the impact of the adoption of this guidance on its financial statements and related disclosures.

The effective date for each amendment will be the date on which the Securities and Exchange Commission’s (“SEC”) removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

The Company will monitor updates to the regulations as they become effective and will adjust its disclosures in future filings, as required.

Improvements to Income Tax Disclosures.

In December 2023, the FASB issued guidance to enhance the transparency and decision usefulness of income tax disclosures through improvements in rate reconciliation and income taxes paid information.

Among other provisions, this guidance requires public entities to disclose specific categories in the rate reconciliation, using both percentages and reporting currency amounts;

and present cash taxes paid on a disaggregated basis.

Among other provisions, this guidance requires public entities to disclose specific categories in the rate reconciliation, using both percentages and reporting currency amounts, and present cash taxes paid on a disaggregated basis.

This guidance is effective for annual periods beginning after December 15, 2024.

Early adoption is permitted.

This guidance is expected to only affect disclosures and will be incorporated into the Company’s filings once effective.

Disaggregation of Disclosures About Income Statement Expenses.

In November 2024, the FASB issued guidance which will require public companies to provide disclosure in the footnotes of certain expense captions into specified categories.

The objective of the standard is to provide more detailed information about the types of expenses presented within expense captions commonly used in the statements of income.

This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted.

The Company is currently evaluating the impact of the adoption of this guidance on its financial statements and related disclosures.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

Presentation of Financial Statements .

In July 2023, the FASB issued guidance which amends various SEC paragraphs pursuant to the issuance of SEC Staff Accounting Bulletin No.

The bulletin added interpretive guidance for public companies to consider when entering into share-based payment transactions while in possession of material non-public information (i.e., “spring-loaded” awards).

This guidance became effective upon issuance and the adoption of this guidance did not have an impact on the Company's Consolidated Financial Statements and related disclosures.

The Company will monitor future stock-based awards and will include additional disclosures in future filings, if applicable.

Contract Assets and Contract Liabilities from Contracts with Customers Acquired in a Business Combination.

In October 2021, the FASB issued guidance which requires companies to apply Accounting Standards Codification (“ASC”) 606 - Revenue from Contracts with Customers to recognize and measure contract assets and contract liabilities from contracts with customers acquired in a business combination.

This creates an exception to the general recognition and measurement principle in ASC 805 - Business Combinations .

This generally will result in companies recognizing contract assets and contract liabilities at amounts consistent with those recorded by the acquiree immediately before the acquisition date.

This guidance became effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

The amendments should be applied prospectively to business combinations occurring on or after the effective date.

The Company early adopted this guidance in 2022.

The adoption of this guidance has not had a material impact on the Company's Consolidated Financial Statements and related disclosures.

Troubled Debt Restructurings and Vintage Disclosures.

In March 2022, the FASB issued guidance which eliminates the accounting guidance in ASC 310-40 Troubled Debt Restructurings for Creditors and amends the guidance on “vintage disclosures” to require disclosure of current-period gross write-offs by year of origination.

This guidance became effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

As a result of adopting this guidance the Company added the required disclosure of current-period gross write-offs in Note 9— Vacation Ownership Contract Receivables.

Aside from this additional disclosure the adoption of this guidance did not have a material impact on the Company’s Consolidated Financial Statements or related disclosures.

Segment Reporting.

In November 2023, the FASB issued guidance to enhance segment disclosures by requiring incremental segment information on an annual and interim basis for all public entities.

Among other provisions, this guidance requires public entities to disclose significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss.

This guidance became effective for all public entities for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

The adoption of this guidance only affected disclosures within Note 23— Segment Information and did not impact the Company’s financial statements.

Previously reported segment disclosures have been recast to reflect the new presentation under this guidance.

Revenue Recognition

3 unchanged sentences

Developer-financed sales are typically collateralized by the underlying VOI.

Revenue is recognized on VOI sales upon transfer of control, which is defined as the point in time when a binding sales contract has

been executed, the financing contract has been executed for the remaining transaction price, the statutory rescission period has expired, and the transaction price has been deemed to be collectible.

Revenue is recognized on VOI sales upon transfer of control, which is defined as the point in time when a binding sales contract has been executed, the financing contract has been executed for the remaining transaction price, the statutory rescission period has expired, and the transaction price has been deemed to be collectible.

For developer-financed sales, the Company reduces the VOI sales transaction price by an estimate of uncollectible consideration at the time of the sale.

5 unchanged sentences

These services may also include reservation and resort renovation activities.

Such agreements are generally for terms of one year or less and are renewed automatically on an annual basis.

The Company’s management agreements contain cancellation clauses, which allow for either party to cancel the agreement, by either a majority board vote or a majority vote of non-developer interests.

The initial terms of such property management agreements are generally between three to five years ;

however, the vast majority of the agreements provide a mechanism for an automatic one year renewal upon expiration of the terms.

The Company’s management agreements contain cancellation clauses, which allow for either party to cancel the agreement, by either a majority board vote or a majority

vote of non-developer interests.

The Company receives fees for such property management services which are collected monthly in advance and are based upon total costs to operate such resorts (or as services are provided in the case of resort renovation activities).

7 unchanged sentences

2024 2023 2022

Management fee revenue $ 432 $ 413 $ 378

Management fee revenues $ 448 $ 432 $ 413

Reimbursable revenues 397 382 350

Property management fees and reimbursable revenues $ 845 $ 814 $ 763

One of the associations that the Company manages paid its Travel and Membership segment $ 36 million, $ 31 million, and $ 30 million for exchange services during 2023, 2022, and 2021.

One of the associations that the Company manages paid the Travel and Membership segment $ 35 million, $ 36 million, and $ 31 million for exchange services during 2024, 2023, and 2022.

Travel and Membership

8 unchanged sentences

Revenue is recognized when these transactions have been confirmed, net of expected cancellations.

The Company’s vacation exchange business also derives revenues from programs with affiliated resorts, club servicing, and loyalty programs;

and additional exchange-related products that provide members with the ability to protect trading power or points, extend the life of deposits, and combine two or more deposits for the opportunity to exchange into

intervals with higher trading power.

The Company’s vacation exchange business also derives revenues from programs with affiliated resorts, club servicing, and loyalty programs, and additional exchange-related products that provide members with the ability to protect trading power or points, extend the life of deposits, and combine two or more deposits for the opportunity to exchange into intervals with higher trading power.

Revenues from other vacation exchange-related product fees are deferred and recognized upon the occurrence of a future exchange, event, or other related transaction.

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Such costs, which are primarily comprised of commissions paid to internal and external parties and credit card processing fees, are deferred at the inception of the contract and recognized when the benefit is transferred to the customer.

As of December 31, 2023, the capitalized costs were $ 16 million, of which $ 11 million are included in Prepaid expenses and $ 5 million was included in Other assets on the Consolidated Balance Sheets.

As of December 31, 2022, these capitalized costs were $ 18 million, of which $ 11 million are included in Prepaid expenses and $ 7 million are included in Other assets on the Consolidated Balance Sheets.

As of both December 31, 2024 and 2023, the capitalized costs were $ 16 million, of which $ 11 million was included in Prepaid expenses and $ 5 million was included in Other assets on the Consolidated Balance Sheets.

Practical Expedients

17 unchanged sentences

Vacation Ownership

Vacation ownership interest sales (a)

Vacation ownership interest sales

$ 1,721 $ 1,582 $ 1,484

14 unchanged sentences

Net revenues $ 3,864 $ 3,750 $ 3,567

(a) The Company increased its loan loss allowance during 2020 due to an expected increase in net new defaults driven by higher unemployment associated with COVID-19 at that time.

During 2021, the Company released a portion of its COVID-19 related allowance which is reflected as a $ 91 million increase to Vacation ownership interest sales on the Consolidated Statements of Income.

Earnings Per Share

6 unchanged sentences

shareholders $ 378 $ 391 $ 356

Gain/(loss) on disposal of discontinued business attributable to Travel + Leisure Co.

Gain on disposal of discontinued business attributable to Travel + Leisure Co.

shareholders, net of income taxes 33 5 1

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(e) The dilutive impact of the Company’s potential common stock is computed utilizing the treasury stock method using average market prices during the period.

(f) The Company paid cash dividends of $ 0.45 per share for all four quarters of 2023 and $ 0.40 per share for all four quarters of 2022.

The Company paid cash dividends of $ 0.30 per share during the first, second, and third quarters, and $ 0.35 per share for the fourth quarter of 2021.

(f) The Company paid cash dividends of $ 0.50 per share for all four quarters of 2024, $ 0.45 per share for all four quarters of 2023, and $ 0.40 per share for all four quarters of 2022.

Share Repurchase Program

Since the inception of the Company’s share repurchase program in August 2007 proceeds received from stock option exercises have increased the repurchase capacity by $ 81 million.

As of December 31, 2023, the Company had $ 170 million of remaining availability under the program.

On August 20, 2007, the Company’s Board of Directors (“Board”) authorized a share repurchase program that enabled it to purchase its common stock.

As of December 31, 2024, the Board has increased the capacity of the program 10 times, most recently in May 2024 by $ 500 million, bringing the total authorization under the current program to $ 7.0 billion.

Proceeds received from stock option exercises have increased the repurchase capacity by $ 87 million since the inception of this program.

As of December 31, 2024, the Company had $ 441 million of remaining availability in its program.

The following table summarizes stock repurchase activity under the current share repurchase program (in millions):

2 unchanged sentences

As of December 31, 2024 133.0 $ 6,646

During 2022, the United States enacted the Inflation Reduction Act which became effective for the 2023 tax year.

Among other provisions, this law imposes a 1% excise tax on stock buybacks.

During the year ended December 31, 2023, the

Company recorded $ 3 million of excise tax related to share repurchases;

which is included within Treasury stock on the Consolidated Balance Sheets.

During 2024 and 2023, the Company incurred $ 2 million and $ 3 million of excise tax related to share repurchases, included within Treasury stock on the Consolidated Balance Sheets.

Assets acquired and liabilities assumed in business combinations were recorded on the Consolidated Balance Sheets as of the respective acquisition dates based upon their estimated fair values at such dates.

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These costs will be recorded on the Consolidated Statements of Income as expenses.

On January 3, 2023, the Company acquired the Playbook365 business, which is a youth and amateur sports management platform.

This platform was integrated with Alliance Reservations Network’s (“ARN”) event lodging management platform to create an all-in-one solution in the youth sports market in order to broaden the products and services offered by ARN.

Playbook365 was acquired for $ 13 million, comprised of $ 6 million of cash paid at closing and contingent consideration with a fair market value of $ 7 million, which can range to $ 24 million, based on the achievement of certain financial metrics.

If these financial metrics are achieved, the Company would be required to make payments in the first quarter of 2025 and/or 2026.

Accor Vacation Club.

On March 1, 2024, the Company acquired the vacation ownership business of Accor for $ 50 million ($ 44 million net of cash acquired) subject to customary post-closing adjustments based on final valuation information and additional analysis.

The fair value of purchase consideration was comprised of $ 40 million net cash paid at closing and $ 4 million paid during the second quarter of 2024.

This acquisition creates a new line of business for Travel + Leisure Co.

as Accor Vacation Club adds to the Company’s portfolio of brand affiliations and expands its international portfolio in the Asia Pacific region.

Accor receives a percentage of the associated vacation ownership sales revenue as a licensing fee under an exclusive licensing agreement.

This transaction was accounted for as a business acquisition.

As of December 31, 2023, the Company has recognized the assets and liabilities of Playbook365 based on estimates of their acquisition date fair values.

The determination of the fair values of the acquired assets and assumed liabilities, including goodwill and other intangible assets, requires significant judgment.

The purchase price allocation includes:

As of December 31, 2024, the Company has recognized the assets and liabilities of Accor Vacation Club based on estimates of their acquisition date fair values.

The determination of the fair values of the acquired assets and assumed liabilities, including goodwill and other intangible assets, required significant judgment.

The purchase price allocation included:

(i) $ 23 million of definite-lived intangible assets with a weighted average life of 20 years consisting of management agreements and customer relationships, included within Other intangibles, net;

(ii) $ 9 million of Inventory;

(iii) $ 8 million of Trade receivables, net;

(iv) $ 6 million of Goodwill, none of which is expected to be deductible for Australian income tax purposes;

(v) $ 6 million of Property and equipment, net;

and (vi) $ 8 million of Accrued expenses and other liabilities on the Consolidated Balance Sheets.

This business is included within the Vacation Ownership segment.

The Company completed purchase accounting for this transaction during the fourth quarter of 2024.

On January 3, 2023, the Company acquired the Playbook365 business, for $ 13 million, comprised of $ 6 million of cash paid at closing and contingent consideration with a closing date fair market value of $ 7 million, which could range up to $ 24 million, based on the achievement of certain financial metrics.

Playbook365 is a youth and amateur sports management platform.

This platform was integrated with Travel Club’s event lodging management platform to create an all-in-one solution in the youth sports market.

This acquisition was made to broaden the products and services offered by Travel Club.

This transaction was accounted for as a business acquisition.

The Company recognized the assets and liabilities of Playbook365 based on estimates of their acquisition date fair values.

The determination of the fair values of the acquired assets and assumed liabilities, including goodwill and other intangible assets, required significant judgment.

The purchase price allocation included:

(i) $ 5 million of developed software with a weighted average life of four years included within Property and equipment, net on the Consolidated Balance Sheets;

1 unchanged sentence

(iii) $ 3 million of definite-lived intangible assets with a weighted average life of four years primarily consisting of customer relationships included within Other intangibles, net on the Consolidated Balance Sheets;

and (iv) $ 7 million of Accrued expenses and other liabilities.

and (iv) $ 7 million of Accrued expenses and other

All of the goodwill and other intangible assets are expected to be deductible for income tax purposes.

This business is included within the Travel and Membership segment.

The Company completed purchase accounting for this transaction during the third quarter of 2023.

The Company completed purchase accounting for this transaction during 2023.

During the fourth quarter of 2024, the fair value of the Playbook365 contingent consideration was reduced by $ 7 million to reflect the fair value based on expected performance.

This amount was included within Other income, net on the Consolidated Statements of Income.

Travel + Leisure.

On January 5, 2021, the Company acquired the Travel + Leisure brand from Dotdash Meredith (formerly Meredith Corporation) for $ 100 million, $ 35 million of which was paid at closing and is reflected as cash used in Investing activities on the Consolidated Statements of Cash Flows.

The Company made additional payments of $ 20 million, $ 20 million, and $ 15 million in 2021, 2022, and 2023.

On January 5, 2021, the Company acquired the Travel + Leisure brand from Dotdash Meredith (formerly Meredith Corporation) for $ 100 million, $ 35 million of which was paid at closing.

The Company made additional payments of $ 20 million, $ 20 million, and $ 15 million in 2021, 2022, and 2023, and its final payment of $ 10 million during 2024.

The majority of these payments were reflected as cash used in Financing activities on the Consolidated Statements of Cash Flows.

The remaining $ 10 million payment is due in June 2024.

This transaction was accounted for as an asset acquisition, with the full consideration allocated to the related trademark indefinite-lived intangible asset.

1 unchanged sentence

Alliance Reservations Network .

On August 7, 2019, the Company acquired all of the equity of Alliance Reservations Network.

On August 7, 2019, the Company acquired all of the equity of Alliance Reservations Network (“ARN”).

ARN is reported within the Travel and Membership segment and provides private-label travel booking technology solutions.

3 unchanged sentences

This amount was included within Other income, net on the Consolidated Statements of Income.

During 2022, the Company completed a business acquisition at its Travel and Membership segment for $ 2 million.

The purchase price allocations resulted in the recognition of (i) $ 1 million of definite lived intangibles with a weighted average life of seven years (ii) $ 1 million of goodwill;

and (iii) $ 1 million of deferred other revenue.

Discontinued Operations

During 2018, the Company completed the spin-off of its hotel business (“Spin-off”) Wyndham Hotels & Resorts, Inc.

(“Wyndham Hotels”) and the sale of its European vacation rentals business.

Prior to their classification as discontinued operations, the hotel business comprised the Hotel Group segment and the European vacation rentals business was part of the Travel and Membership segment.

During 2023, the Company recognized a $ 5 million Gain on disposal of discontinued business, net of income taxes associated with the expiration of a guarantee associated with the sale of the European vacation rentals business.

See Note 27— Transactions with Former Parent and Former Subsidiaries for additional information.

During 2018, the Company sold its European vacation rentals business, which was part of the Travel and Membership segment prior to its classification as a discontinued operation.

In connection with this sale, the Company recognized a $ 33 million Gain on disposal of discontinued business, net of income taxes on the Consolidated Statements of Income during 2024.

This gain on disposal includes $ 32 million, net of tax, related to the expiration of certain guarantees made in connection with the sales agreement and a $ 1 million tax refund related to pre-sale tax items.

This tax refund is included within Net cash provided by/(used in) investing activities from discontinued operations on the Consolidated Statements of Cash Flows.

During 2023, the Company recognized a $ 5 million Gain on disposal of discontinued business, net of income taxes on the Consolidated Statements of Income resulting from the expiration of a guarantee associated with the sale of the European vacation rentals business.

During 2022, the Company had $ 5 million of Net cash used in investing activities from discontinued operations on the Consolidated Statements of Cash Flows which included $ 6 million related to the settlement of post-closing adjustment claims associated with the sale of the European vacation rentals business;

partially offset by $ 1 million of tax refunds related to various pre-sale tax items included in Gain/(loss) on disposal of discontinued business, net of income taxes on the Consolidated Statements of Income.

During 2021, the Company recognized a $ 5 million Loss on disposal of discontinued business, net of income taxes as a result of entering into a settlement agreement for post-closing adjustment claims related to the sale of the European vacation rentals business.

See Note 27— Transactions with Former Parent and Former Subsidiaries for additional information.

partially offset by $ 1 million of tax refunds related to various pre-sale tax items included in Gain on disposal of discontinued business, net of income taxes on the Consolidated Statements of Income.

The Company does not expect to incur significant ongoing gains and/or losses for the aforementioned discontinued operations.

See Note 27— Transactions with Former Parent and Former Subsidiaries for additional information.

Intangible Assets

16 unchanged sentences

(a) Comprised of trademarks and trade names the Company has acquired that are expected to generate future cash flows for an indefinite period of time.

During 2022, the Company recorded a $ 2 million trade name impairment at the Travel and Membership segment.

(b) Amortized between 4 to 15 years with a weighted average life of 13 years.

1 unchanged sentence

(d) Amortized between 5 to 8 years with a weighted average life of 7 years.

During 2024, the Company recorded a $ 1 million impairment to trademarks at the Travel and Membership segment.

(e) Includes business contracts and noncompetition covenants, which are amortized between 3 to 69 years with a weighted average life of 58 years.

22 unchanged sentences

Foreign ( 2 ) 2 —

8 ( 4 ) ( 39 )

Provision for income taxes $ 135 $ 94 $ 130

52 unchanged sentences

Beginning balance $ 22 $ 25 $ 27

Increases related to tax positions taken during a prior period — — 2

Increases related to tax positions taken during the current period 2 1 2

4 unchanged sentences

The Company records potential penalties and interest as a component of Provision for income taxes on the Consolidated Statements of Income related to these unrecognized tax benefits.

During 2023 penalties and interest decreased by less than $ 1 million.

During 2024 and 2023 penalties and interest decreased by less than $ 1 million in each year.

During 2022 penalties and interest decreased by $ 1 million.

During 2021 penalties and interest increased by $ 1 million.

The Company had a liability for potential penalties of $ 3 million as of December 31, 2023, and $ 4 million as of December 31, 2022 and 2021, and potential interest of $ 10 million, $ 10 million, and $ 11 million as of December 31, 2023, 2022, and 2021.

The Company had a liability for potential penalties of $ 3 million, $ 3 million, and $ 4 million as of December 31, 2024, 2023 and 2022, and potential interest of $ 9 million, $ 10 million, and $ 10 million during these periods.

Such liabilities are reported as a component of Accrued expenses and other liabilities on the Consolidated Balance Sheets.

10 unchanged sentences

The Company made cash income tax payments, net of refunds, of $ 100 million, $ 144 million, and $ 153 million during 2024, 2023, and 2022.

Such payments exclude income tax related payments made to or refunded by the Company’s former parent Cendant Corporation (“Cendant”) and Wyndham Hotels.

Such payments exclude income tax related payments made to or refunded by the Company’s former parent Avis Budget Group, Inc., formerly Cendant Corporation and Wyndham Hotels & Resorts, Inc.

(“Wyndham Hotels”).

Vacation Ownership Contract Receivables

10 unchanged sentences

(a) Excludes $ 19 million and $ 18 million of accrued interest on VOCRs as of December 31, 2024 and 2023, which are included in Trade receivables, net on the Consolidated Balance Sheets.

(b) Excludes $ 8 million and $ 7 million of accrued interest on VOCRs as of December 31, 2023 and 2022, which are included in Trade receivables, net on the Consolidated Balance Sheets.

(b) Excludes $ 8 million of accrued interest on VOCRs as of both December 31, 2024 and 2023, which are included in Trade receivables, net on the Consolidated Balance Sheets.

Principal payments due on the Company’s VOCRs during each of the five years subsequent to December 31, 2024, and thereafter are as follows (in millions):

10 unchanged sentences

Such interest income is included within Consumer financing revenue on the Consolidated Statements of Income.

During 2023, 2022, and 2021, the Company had net VOCR originations of $ 1.43 billion, $ 1.14 billion, and $ 780 million and received principal collections of $ 924 million, $ 771 million, and $ 815 million.

During 2024, 2023, and 2022, the Company had net VOCR originations of $ 1.53 billion, $ 1.43 billion, and $ 1.14 billion and received principal collections of $ 983 million, $ 924 million, and $ 771 million.

The weighted average interest rate on outstanding VOCRs was 14.7 %, 14.7 %, and 14.6 % during 2024, 2023, and 2022.

10 unchanged sentences

(a) Recorded as a reduction to Net revenue.

The Company increased its allowance losses during 2020 due to an expected increase in net new defaults driven by current and projected unemployment rates associated with COVID-19 at that time.

During 2021, the Company released a portion of its COVID-19 related allowance which is reflected as a $ 91 million increase to Vacation ownership interest sales and a $ 33 million increase to Cost of vacation ownership interests on the Consolidated Statements of Income.

Credit Quality for Financed Receivables and the Allowance for Credit Losses

7 unchanged sentences

FICO scores ranging from 700 to 850, from 600 to 699, below 600, no score (primarily comprised of consumers for whom a score is not readily available, including consumers declining access to FICO scores and non-U.S.

residents), and Asia Pacific (comprised of receivables in the Company’s Vacation Ownership Asia Pacific business for which scores are not available).

The following table details an aging analysis of financing receivables using the most recently updated FICO scores, based on the policy described above (in millions):

residents), and Asia Pacific (comprised of receivables in the Company’s Travel + Leisure Vacation Clubs Asia Pacific business for which scores are not available).

The following tables details an aging analysis of financing receivables using the most recently updated FICO scores, based on the policy described above (in millions):

As of December 31, 2024

46 unchanged sentences

Once registered and available for sale, the units are then transferred back into completed inventory.

The Company had net transfers of VOI inventory to property and equipment of $ 16 million and $ 19 million during 2023 and 2022.

The Company had net transfers of VOI inventory from property and equipment of $ 56 million during 2024 and had net transfers of VOI inventory to property and equipment of $ 16 million during 2023.

Inventory Obligations

2 unchanged sentences

The following table summarizes the activity related to the Company’s inventory obligations (in millions):

Las Vegas (b)

Las Vegas (a)

December 31, 2022 $ 30 $ 7 $ 37

5 unchanged sentences

December 31, 2024 $ — $ 7 $ 7

(a) Represents vacation ownership inventory and property and equipment in Atlanta, Georgia, acquired from a third-party developer.

(b) Included in Accrued expenses and other liabilities on the Consolidated Balance Sheets.

(a) Included in Accrued expenses and other liabilities on the Consolidated Balance Sheets.

(b) Included in Accounts payable on the Consolidated Balance Sheets.

Property and Equipment

11 unchanged sentences

During 2024, 2023, and 2022, the Company recorded depreciation and amortization expense of $ 105 million, $ 102 million, and $ 110 million related to property and equipment.

As of December 31, 2023 and 2022, the Company had accrued capital expenditures of $ 5 million and $ 4 million.

As of both December 31, 2024 and 2023, the Company had accrued capital expenditures of $ 5 million.

The Company leases property and equipment under finance and operating leases for its corporate headquarters, administrative functions, marketing and sales offices, and various other facilities and equipment.

55 unchanged sentences

Deferred costs 54 58

Tax receivables 52 3

Capitalized contract costs (a)

Right-of-use assets 47 46

Tax receivables 42 52

Payroll funding 37 2

Deferred tax asset 23 23

Investments 19 18

Held-for-sale 19 18

Investments 18 19

Marketable securities 17 14

Derivatives contract assets 11 12

Deposits 17 10

6 unchanged sentences

Lease liabilities (a)

Resort related obligation and commitments 66 68

Accrued taxes 60 65

Guarantees 62 68

Accrued interest 55 52

Payables associated with separation and sale of business activities 50 49

Resort related obligations 48 45

Accrued interest 49 55

Accrued advertising and marketing 38 35

Restructuring liabilities (b)

Accrued VOI maintenance fees 20 21

Accrued legal and professional fees 20 21

Deferred consideration (c)

Funds on deposit 31 17

Customer advances 12 12

Derivative contract liabilities 10 13

Accrued legal settlements 7 3

Inventory sale obligation (d)

Accrued legal and professional fees 27 20

Guarantees 24 62

Restructuring liabilities (b)

Deferred contingent consideration (c)

Accrued other 100 102

2 unchanged sentences

(d) See Note 10— Inventory for details.

The Company’s indebtedness consisted of the following (in millions):

8 unchanged sentences

$300 million 2018 secured term loan B (due May 2025) (g)

$598 million 2023 secured incremental term loan B (due December 2029) (h)

$400 million 3.90% secured notes (due March 2023) (i)

$598 million 2023 incremental secured term loan B (due December 2029) (h)

$875 million 2024 secured term loan B (due December 2029) (i)

$300 million 5.65% secured notes (due April 2024) — 300

14 unchanged sentences

Borrowings under this facility are required to be repaid no later than January 2029.

(e) The carrying amounts of the secured notes and term loan are net of unamortized discounts of $ 20 million and $ 23 million as of December 31, 2023 and 2022, and net of unamortized debt financing costs of $ 12 million and $ 10 million as of December 31, 2023 and 2022.

(f) The weighted average effective interest rate on borrowings from this facility was 7.47 % and 7.53 % as of December 31, 2023 and 2022.

(g) The weighted average effective interest rate on borrowings from this facility was 7.49 % and 4.01 % as of December 31, 2023 and 2022.

(h) The weighted average effective interest rate on borrowings from this facility was 9.25 % and 8.24 % as of December 31, 2023 and 2022.

(i) Includes less than $ 1 million of unamortized gains from the settlement of a derivative as of December 31, 2022.

(e) The carrying amounts of the secured notes and term loan are net of unamortized discounts of $ 15 million and $ 20 million as of December 31, 2024 and 2023, and net of unamortized debt financing costs of $ 12 million as of both December 31, 2024 and 2023.

(f) The weighted average effective interest rate on facility borrowings was 7.52 % and 7.47 % as of December 31, 2024 and 2023.

(g) The weighted average effective interest rate on facility borrowings was 7.49 % as of December 31, 2023.

(h) The weighted average effective interest rate on facility borrowings was 9.25 % as of December 31, 2023.

(i) The weighted average effective interest rate on facility borrowings was 7.04 % as of December 31, 2024.

(j) Includes $ 1 million and $ 2 million of unamortized losses from the settlement of a derivative as of December 31, 2024 and 2023.

12 unchanged sentences

Actual maturities may differ as a result of prepayments by the VOCR obligors.

As of December 31, 2023, the available capacity under the Company’s borrowing arrangements was as follows (in millions):

As of December 31, 2024, the available capacities under the Company’s borrowing arrangements were as follows (in millions):

Non-recourse Conduit Facilities (a)

5 unchanged sentences

(a) Consists of the Company’s USD bank conduit facility and AUD/NZD bank conduit facility.

The capacity of these facilities is subject to the Company’s ability to provide additional assets to collateralize additional non-recourse borrowings.

The capacities of these facilities are subject to the Company’s ability to provide additional assets to collateralize additional non-recourse borrowings.

(b) Consists of the Company’s $ 1.0 billion secured revolving credit facility.

2 unchanged sentences

Sierra Timeshare 2024-1 Receivables Funding LLC.

On April 5, 2023, the Company closed on a placement of a series of term notes payable, issued by Sierra Timeshare 2023-1 Receivables Funding LLC, with an initial principal amount of $ 250 million, secured by VOCRs and bearing interest at a weighted average coupon rate of 6.33 %.

On March 21, 2024, the Company closed on a placement of a series of term notes payable, issued by Sierra Timeshare 2024-1 Receivables Funding LLC, with an initial principal amount of $ 350 million, secured by VOCRs and bearing interest at a weighted average coupon rate of 5.66 %.

The advance rate for this transaction was 95.25 %.

9 unchanged sentences

As of December 31, 2024, the Company had $ 290 million of outstanding borrowings under these term notes, net of debt issuance costs.

Premium Yield Facility 2023-A LLC.

On December 20, 2023, the Company closed on a private term securitization transaction with an initial principal amount of $ 238 million.

The transaction is secured by VOCRs and includes $ 34 million in receivables rolled from the Company’s 2018-A Premium Yield Facility, which the Company called on December 15, 2023.

The advance rate for this transaction was 80.0 % and the borrowings bear interest at a coupon rate of 6.51 %.

As of December 31, 2023, the Company had $ 236 million of outstanding borrowings under this facility, net of debt issuance costs.

In addition to the 2024 term notes described above, as of December 31, 2024, the Company had $ 954 million of outstanding non-recourse borrowings, net of debt issuance costs, under term notes entered into prior to December 31, 2023.

6 unchanged sentences

AUD/NZD bank conduit facility.

The Company has a non-recourse AUD/NZD timeshare receivables conduit facility, with a total capacity of A$ 200 million and NZ$ 25 million.

The facility is secured by VOCRs and bears interest at variable rates based on the Bank Bill Swap Bid Rate plus 2.0 %.

On December 20, 2024, the Company renewed its AUD/NZD timeshare receivables conduit facility, extending the end of the commitment period from December 2024 to December 2026.

The facility has a total capacity of A$ 200 million and NZ$ 25 million and is secured by VOCRs, bearing interest at variable rates based on the Bank Bill Swap Bid Rate plus 1.55 %, a reduction of 45 basis points.

Borrowings under this facility are required to be repaid no later than January 2029.

3 unchanged sentences

The combined weighted average interest rate on the Company’s total non-recourse vacation ownership debt was 6.8 %, 5.9 %, and 4.2 % during 2024, 2023, and 2022.

$1.0 billion Revolving Credit Facility and $300 million 2018 Term Loan B due May 2025.

$1.0 billion Revolving Credit Facility and Term Loan B facilities.

The Company has a credit agreement with Bank of America, N.A.

as administrative agent and collateral agent.

The agreement provides for senior secured credit facilities in the amount of $ 1.3 billion, consisting of the secured 2018 Term Loan B of $ 300 million maturing in 2025 and a secured revolving facility of $ 1.0 billion maturing in 2026.

On March 30, 2023, the Company entered into the fourth amendment to the credit agreement governing its revolving credit facility and term loan B facilities.

Through this amendment the Company exercised its early opt-in election to change the benchmark rate on the revolving credit facility and 2018 Term Loan B facility due May 2025 from the USD London Interbank Offered Rate (“LIBOR”) to SOFR.

This change became effective on March 31, 2023, for both new borrowings and rollovers of then existing USD LIBOR based borrowings (except Base Rate borrowings) and eliminated the Company’s exposure to LIBOR.

As of December 31, 2023, the Company’s interest rate per annum applicable to the 2018 Term Loan B Facility is equal to, at the Company’s option, either a base rate plus a margin of 1.25 % or the SOFR plus a margin of 2.25 %.

The interest rate per annum applicable to borrowings under the revolving credit facility is equal to, at the Company’s option, either a base rate plus a margin ranging from 0.75 % to 1.25 % or SOFR plus a margin ranging from 1.75 % to 2.25 %, in either case based upon the first-lien leverage ratio of Travel + Leisure Co.

The agreement provides for senior secured credit facilities in the amount of $ 1.88 billion, consisting of a $ 875 million Term Loan B facility and a $ 1.0 billion secured revolving facility.

On December 10, 2024, the Company amended the credit agreement governing these facilities (“Sixth Amendment”).

Through this amendment the Company repriced and replaced the $ 593 million outstanding balance on the 2023 Incremental Term Loan B facility and refinanced the remaining $ 282 million balance on the 2018 Term Loan B facility which would have been due May 2025.

The resulting new $ 875 million 2024 Term Loan B facility matures on December 14, 2029.

This facility was issued at par with no discount, and the principal amortizes in equal quarterly installments of 0.25 % of the initial principal amount, starting with the first quarter of 2025.

Deferred financing costs related to the Sixth amendment were $ 4 million, which will be amortized over the life of the facility.

As of December 31, 2024, the interest rate per annum applicable to borrowings under the revolving credit facility is equal to, at the Company’s option, either a base rate plus a margin ranging from 0.75 % to 1.25 % or SOFR plus a margin ranging from 1.75 % to 2.25 %, in either case based upon the first-lien leverage ratio of Travel + Leisure Co.

and its restricted subsidiaries.

The SOFR rate with respect to either the term loan B facilities or the revolving credit facility borrowings are subject to a floor of 0.50 %.

The interest rate per annum applicable to borrowings under the 2024 Term Loan B facility is equal to, at the Company’s option, either a base rate (which is the highest of Bank of America’s prime rate, the federal funds rate plus 0.50 %, and the Term SOFR (as defined in the Credit Agreement) one month rate, plus an applicable rate of 1.50 %), or (b) the Term SOFR rate, plus an applicable rate of 2.50 %.

The SOFR rates with respect to the both the revolving credit facility and the 2024 Term Loan B facility are subject to a floor of 0.50 %.

The Company is also subject to a commitment fee for the unused portion of its revolving credit facility.

2 unchanged sentences

as collateral agent on behalf of the secured parties (as defined in the security agreement) and has been in force since May 31, 2018.

The security agreement grants a security interest in the collateral of the Company (as defined in the security agreement) and includes the holders of Travel + Leisure Co.'s outstanding secured notes, as “secured parties.” These note holders share equally and ratably in the collateral (as defined in the security agreement) owned by the Company for so long as the indebtedness under the credit agreement is secured by such collateral.

$598 million 2023 Incremental Term Loan B due December 2029.

On December 20, 2023, the Company amended the credit agreement governing its revolving credit facility and term loan B facilities (“Fifth Amendment”).

The Fifth Amendment refinanced $ 298 million of outstanding borrowings under the 2022 Incremental Term Loan B facility and included additional borrowings of $ 300 million.

The Company expects to use net proceeds from the 2023 Incremental Term Loan B facility, together with available cash on hand and revolving credit facility borrowings to repay its outstanding $ 300 million 5.65 % secured notes due April 2024 and pay related fees and expenses.

The 2023 Incremental Term Loan B facility matures on December 14, 2029, and is priced at SOFR plus 3.25 % plus a 0.10 % SOFR Adjustment, which is 75 basis points lower than the 2022 Incremental Term Loan B facility.

$ 298 million of the borrowings under the 2022 Incremental Term Loan B facility is priced at par, while the additional $ 300 million was subject to an original issue discount of 99.75 %.

The floor rate remains at 0.50 % for Term SOFR borrowings.

The 2023 Incremental Term Loan B facility amortizes in equal quarterly installments of 0.25 % of the initial principal amount, starting with the first quarter of 2024.

Proceeds from the Fifth Amendment for the facility were $ 290 million, which were net of the debt discount, arrangement fees, and unpaid interest through the date of the amendment.

Debt discount and deferred financing costs were collectively $ 5 million, which will be amortized over the life of the notes.

The security agreement grants a security interest in the collateral of the Company (as defined in

the security agreement) and includes the holders of Travel + Leisure Co.’s outstanding secured notes, as “secured parties.” These note holders share equally and ratably in the collateral (as defined in the security agreement) owned by the Company for so long as the indebtedness under the credit agreement is secured by such collateral.

Secured Notes.

The interest rates increased for certain of the outstanding secured notes that were impacted by rating agency downgrades of the Company’s corporate notes.

Pursuant to the terms of the indentures governing such rating sensitive series of notes, the interest rate on each such series of notes may be subject to future increases or decreases, as a result of future downgrades or upgrades to the credit ratings of such notes by Standard & Poor’s Rating Services (“S&P”), Moody’s Investors Service, Inc.

(“Moody’s”), or a substitute rating agency.

Since issuance, the interest rates on the impacted notes have increased 150 basis points as of December 31, 2023, with a maximum potential for additional increase of 50 basis points.

Pursuant to the terms of the indentures governing the Company’s rating sensitive series of notes, the $ 350 million 6.60 % notes due 2025 and the $ 400 million 6.00 % notes due 2027, the interest rate on each such series of notes may be subject to future increases or decreases, as a result of future downgrades or upgrades to the credit ratings of such notes by Standard & Poor’s Rating Services, Moody’s Investors Service, Inc., or a substitute rating agency.

Since issuance, the interest rates on the related notes have increased 150 basis points as of December 31, 2024, with a maximum potential for additional increase of 50 basis points.

As of December 31, 2024, the Company had $ 2.39 billion of outstanding secured notes issued prior to December 31, 2023.

13 unchanged sentences

As of December 31, 2024, the Company was in compliance with the financial covenants described above.

Each of the Company’s non-recourse securitized term notes, and the bank conduit facilities contain various triggers relating to the performance of the applicable loan pools.

If the VOCR pool that collateralizes one of the Company’s securitization notes fails to perform within the parameters established by the contractual triggers (such as higher default or delinquency

rates), there are provisions pursuant to which the cash flows for that pool will be maintained in the securitization as extra collateral for the note holders or applied to accelerate the repayment of outstanding principal to the note holders.

Each of the Company’s non-recourse securitized term notes and bank conduit facilities contain various triggers relating to the performance of the applicable loan pools.

If the VOCR pool that collateralizes one of the Company’s securitization notes fails to perform within the parameters established by the contractual triggers (such as higher default or delinquency rates), there are provisions pursuant to which the cash flows for that pool will be maintained in the securitization as extra collateral for the note holders or applied to accelerate the repayment of outstanding principal to the note holders.

As of December 31, 2024, all of the Company’s securitized loan pools were in compliance with applicable contractual triggers.

1 unchanged sentence

The Company incurred interest expense of $ 249 million, $ 251 million, and $ 195 million during 2024, 2023, and 2022 excluding interest expense associated with non-recourse vacation ownership debt.

These amounts include offsets of less than $ 1 million, $ 1 million, and less than $ 1 million of capitalized interest during 2023, 2022, and 2021.

These amounts include offsets of $ 1 million, less than $ 1 million, and $ 1 million of capitalized interest during 2024, 2023, and 2022.

Cash paid related to such interest was $ 245 million, $ 239 million, and $ 189 million during 2024, 2023, and 2022.

55 unchanged sentences

See Note 18— Financial Instruments for additional details.

As of December 31, 2023, the Company had foreign exchange forward contracts resulting in $ 1 million of assets which are included within Other assets and less than $ 1 million of liabilities which are included in Accrued expenses and other liabilities on the Consolidated Balance Sheets.

As of December 31, 2024, the Company had foreign exchange contracts resulting in less than $ 1 million of assets which are included within Other assets and $ 1 million of liabilities which are included in Accrued expenses and other liabilities on the Consolidated Balance Sheets.

On a recurring basis, such assets and liabilities are remeasured at estimated fair value (all of which are Level 2) and thus are equal to the carrying value.

7 unchanged sentences

The carrying amounts of cash and cash equivalents, restricted cash, trade receivables, accounts payable, and accrued expenses and other current liabilities approximate fair value due to the short-term maturities of these assets and liabilities.

The carrying amounts and estimated fair values of the Company’s other financial instruments were as follows (in millions):

The carrying amounts and estimated fair values of all other financial instruments were as follows (in millions):

December 31, 2024 December 31, 2023

6 unchanged sentences

The Company estimates the fair value of its non-recourse vacation ownership debt by obtaining Level 2 inputs comprised of indicative bids from investment banks that actively issue and facilitate the secondary market for timeshare securities.

The Company estimates the fair value of its debt, excluding finance leases, using Level 2 inputs based on indicative bids from investment banks and determines the fair value of its secured notes using quoted market prices (such secured notes are not actively traded).

The Company estimates the fair value of its debt, excluding finance leases, using Level 2 inputs based on indicative bids

from investment banks and determines the fair value of its secured notes using quoted market prices (such secured notes are not actively traded).

Financial Instruments

20 unchanged sentences

The Company uses freestanding foreign currency forward contracts to manage a portion of its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables, payables, and forecasted earnings of foreign subsidiaries.

Additionally, the Company has used foreign currency forward contracts designated as cash flow hedges to manage a portion of its

exposure to changes in forecasted foreign currency denominated vendor payments.

Additionally, the Company has used foreign currency forward contracts designated as cash flow hedges to manage a portion of its exposure to changes in forecasted foreign currency denominated vendor payments.

As of December 31, 2024, the Company had no gains or losses relating to contracts designated as cash flow hedges included in AOCL.

7 unchanged sentences

There were no losses on derivatives recognized in AOCL for the years ended December 31, 2024, 2023, or 2022.

The following table summarizes information regarding the gains recognized in income on the Company’s freestanding derivatives (in millions):

The following table summarizes information regarding the (losses)/gains recognized in income on the Company’s freestanding derivatives (in millions):

Year Ended December 31,

2 unchanged sentences

Foreign exchange contracts (a)

$ ( 1 ) $ 1 $ —

(a) Included within Operating expenses on the Consolidated Statements of Income, which is primarily offset by changes in the value of the underlying assets and liabilities.

7 unchanged sentences

Local and regional economic conditions and other factors may differ materially from prevailing conditions in other parts of the world.

Nevada, Florida, and California are examples of areas with concentrations of sales offices.

For the year ended December 31, 2023, the Company generated 14 %, 14 %, and 11 % of its VOI sales revenues in sales offices located in Nevada, Florida, and California.

Florida, California, and Nevada are examples of areas with concentrations of sales offices.

For the year ended December 31, 2024, the Company generated 19 %, 12 %, and 11 % of its VOI sales revenues in sales offices located in Florida, California, and Nevada.

Additionally, residents who live in California represent 17 % of the Company’s outstanding VOCRs portfolio.

8 unchanged sentences

In the normal course of business, the Company makes various commitments to purchase goods or services from specific suppliers, including those related to vacation ownership resort development and other capital expenditures.

Purchase commitments made by the Company as of December 31, 2023, aggregated to $ 748 million, of which $ 533 million were for marketing-related activities and $ 133 million were for information technology activities.

Purchase commitments made by the Company as of December 31, 2024, aggregated to $ 777 million, of which $ 502 million were for marketing-related activities, $ 116 million were related to the development of vacation ownership properties, and $ 106 million were for information technology activities.

Letters of Credit

As of December 31, 2023, the Company had $ 47 million of irrevocable standby letters of credit outstanding, of which $ 2 million were under its revolving credit facilities.

As of December 31, 2022, the Company had $ 34 million of irrevocable standby letters of credit outstanding, none of which were under its revolving credit facilities.

The letters of credit issued during 2023 and 2022 also supported the securitization of VOCR fundings, certain insurance policies, and development activity at the Company’s Vacation Ownership segment.

As of December 31, 2024, the Company had $ 45 million of irrevocable standby letters of credit outstanding, of which $ 1 million was under its revolving credit facility.

As of December 31, 2023, the Company had $ 47 million of irrevocable standby letters of credit outstanding, of which $ 2 million was under its revolving credit facility.

The letters of credit issued

during 2024 and 2023 also supported the securitization of VOCR fundings, certain insurance policies, and development activity at the Company’s Vacation Ownership segment.

A portion of the Company’s vacation ownership sales and developments are supported by surety bonds provided by affiliates of certain insurance companies in order to meet regulatory requirements of certain states.

10 unchanged sentences

The Company records an accrual for legal contingencies when it determines, after consultation with outside counsel where appropriate, that it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

In making such determinations, the Company evaluates, among other things, the degree of probability of an unfavorable

outcome and, when it is probable that a liability has been incurred, the Company’s ability to make a reasonable estimate of loss.

In making such determinations, the Company evaluates, among other things, the degree of probability of an unfavorable outcome and, when it is probable that a liability has been incurred, the Company’s ability to make a reasonable estimate of loss.

The Company reviews these accruals each fiscal quarter and makes revisions based on changes in facts and circumstances including changes to its strategy in dealing with these matters.

3 unchanged sentences

As of December 31, 2024, it is estimated that the potential exposure resulting from adverse outcomes of such legal proceedings could, in the aggregate, range up to $ 20 million in excess of recorded accruals.

Such reserves are exclusive of matters relating to the Company’s separation from Cendant, matters relating to Wyndham Hotels, matters relating to the sale of the European vacation rentals business, and matters relating to the sale of the North American vacation rentals business, which are discussed in Note 27— Transactions with Former Parent and Former Subsidiaries .

Such accruals are exclusive of matters relating to the Company’s separation from Avis Budget Group Inc., matters relating to the spin-off of Wyndham Hotels (“Spin-off”), and matters relating to the sale of the vacation rentals businesses, which are discussed in Note 27— Transactions with Former Parent and Former Subsidiaries .

However, the Company does not believe that the impact of such litigation should result in a material liability to the Company in relation to its consolidated financial position and/or liquidity.

19 unchanged sentences

Balance as of December 31, 2021 $ ( 145 ) $ ( 1 ) $ — $ ( 146 )

Other comprehensive loss

( 32 ) — — ( 32 )

Balance as of December 31, 2021 ( 145 ) ( 1 ) — ( 146 )

Other comprehensive (loss)/income

3 unchanged sentences

Balance as of December 31, 2023 ( 170 ) — 1 ( 169 )

Tax Foreign Currency Translation Adjustments Unrealized (Losses)/Gains on Cash Flow Hedges Defined Benefit Pension Plans Accumulated Other Comprehensive Loss

Other comprehensive loss

( 40 ) — — ( 40 )

Balance as of December 31, 2024 $ ( 210 ) $ — $ 1 $ ( 209 )

Other comprehensive income

Tax Foreign Currency Translation Adjustments Unrealized (Losses)/Gains on Cash Flow Hedges Defined Benefit Pension Plans Accumulated Other Comprehensive Loss

Balance as of December 31, 2021 $ 97 $ 1 $ — $ 98

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Balance as of December 31, 2023 99 — — 99

Net of Tax Foreign Currency Translation Adjustments Unrealized (Losses)/Gains on Cash Flow Hedges Defined Benefit Pension Plans Accumulated Other Comprehensive Loss

Balance as of December 31, 2020 $ ( 16 ) $ — $ — $ ( 16 )

Other comprehensive loss

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Balance as of December 31, 2024 $ 97 $ — $ — $ 97

Net of Tax Foreign Currency Translation Adjustments Unrealized (Losses)/Gains on Cash Flow Hedges Defined Benefit Pension Plans Accumulated Other Comprehensive Loss

Balance as of December 31, 2021 $ ( 48 ) $ — $ — $ ( 48 )

Other comprehensive loss

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Balance as of December 31, 2023 ( 71 ) — 1 ( 70 )

Other comprehensive loss

( 42 ) — — ( 42 )

Balance as of December 31, 2024 $ ( 113 ) $ — $ 1 $ ( 112 )

Foreign currency translation adjustments exclude income taxes related to investments in foreign subsidiaries where the Company intends to reinvest the undistributed earnings indefinitely in those foreign operations.

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The Company has a stock-based compensation plan available to grant RSUs, PSUs, stock-settled appreciation rights, NQs, and other stock-based awards to key employees, non-employee directors, advisors, and consultants.

The Wyndham Worldwide Corporation 2006 Equity and Incentive Plan was originally adopted in 2006 and was amended and restated in its entirety and approved by shareholders on May 17, 2018, (the “Amended and Restated Equity Incentive Plan”).

Under the Amended and Restated 2006 Equity Incentive Plan, a maximum of 15.7 million shares of common stock may be awarded.

As of December 31, 2023, 10.1 million shares remain available, based on target performance.

As of December 31, 2024, based on number of awards granted at target performance levels, 10.0 million shares remained available.

Incentive Equity Awards Granted by the Company

During the year ended December 31, 2023, the Company granted incentive equity awards to key employees and senior officers of $ 35 million in the form of RSUs and $ 21 million in the form of PSUs.

Of these awards, the majority of RSUs will vest ratably over a period of four years .

The majority of PSUs will cliff vest on the third anniversary of the grant date, contingent upon the Company achieving certain performance metrics.

During the year ended December 31, 2024, the Company granted incentive equity awards to key employees and senior officers of $ 34 million in the form of RSUs and $ 10 million in the form of PSUs, based on target performance.

Of these awards, the majority of RSUs will vest ratably over a period of four years and the PSUs will cliff vest on the third anniversary of the grant date, contingent upon the Company achieving certain performance metrics, with a maximum vesting of 200 %.

During the year ended December 31, 2023, the Company granted incentive equity awards of $ 35 million in the form of RSUs and $ 21 million in the form of PSUs.

During 2021, the Company granted incentive equity awards of $ 35 million in the form of RSUs, $ 7 million in the form of PSUs, and $ 2 million in the form of stock options.

During 2022 the Company granted incentive equity awards of $ 34 million in the form of RSUs and $ 13 million in the form of PSUs.

The activity related to incentive equity awards granted by the Company to key employees and senior officers for the year ended December 31, 2024, consisted of the following (in millions, except grant prices):

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(c) Aggregate unrecognized compensation expense related to RSUs was $ 49 million as of December 31, 2024, which is expected to be recognized over a weighted average period of 2.5 years.

(d) Aggregate unrecognized compensation expense related to PSUs that are probable of vesting was $ 6 million as of December 31, 2023, which is expected to be recognized over a weighted average period of 0.7 years.

(d) The a ggregate unrecognized compensation expense related to PSUs that are probable of vesting was $ 9 million as of December 31, 2024, which is expected to be recognized over a weighted average period of 2.0 years.

The maximum amount of compensation expense associated with PSUs that are not probable of vesting could range up to $ 42 million which would be recognized over a weighted average period of 1.2 years.

(e) There were 1.1 million NQs which were exercisable as of December 31, 2024.

These NQs will expire over a weighted average period of 5.3 years and carry a weighted average grant date fair value of $ 8.61 .

Unrecognized compensation expense for the NQs was $ 1 million as of December 31, 2023, which is expected to be recognized over a weighted average period of 1.0 year.

The Company did not grant any stock options during the years ended 2023 and 2022.

The fair value of stock options granted by the Company during 2021 were estimated on the date of the grant using the Black-Scholes option-pricing model with the relevant weighted average assumptions outlined in the table below.

These exercisable NQs will expire over a weighted average period of 4.9 years and carry a weighted average grant date fair value of $ 8.84 .

Unrecognized compensation expense for the NQs was less than $ 1 million as of December 31, 2024, which is expected to be recognized over a weighted average period of 0.2 years.

The Company did not grant any stock options during the years 2024, 2023, or 2022.

The fair value of stock options granted by the Company prior to 2022 were estimated on the date of grant using the Black-Scholes option-pricing model with the relevant weighted average assumptions.

Expected volatility was based on both historical and implied volatilities of the Company’s stock and the stock of comparable companies over the estimated expected life for options.

The expected life represents the period of time these awards were expected to be outstanding on the date of grant.

The expected life represented the period of time these awards were expected to be outstanding.

The risk-free interest rate was based on yields on U.S.

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The projected dividend yield was based on the Company’s anticipated annual dividend divided by the price of the Company’s stock on the date of the grant.

Stock Options 2021

Grant date fair value $ 18.87

Grant date strike price $ 59.00

Expected volatility 44.80 %

Expected life (a)

Risk-free interest rate

Projected dividend yield

(a) The maximum contractual term for these options is 10 years.

The total intrinsic value of exercised options was less than $ 1 million during 2023, and 2022, and $ 1 million during 2021.

The fair value of shares that vested during 2023, 2022, and 2021 were $ 37 million, $ 34 million, and $ 33 million.

The Company received $ 6 million from option exercises during 2024, and less than $ 1 million in each of 2023 and 2022.

The total intrinsic value of options exercised was $ 1 million during 2024, and less than $ 1 million during 2023 and 2022.

The vest date fair value of shares that vested during 2024, 2023, and 2022 were $ 35 million, $ 37 million, and $ 34 million.

Stock-Based Compensation Expense

The Company recorded stock-based compensation expense of $ 41 million, $ 38 million, and $ 45 million during 2024, 2023, and 2022, related to the incentive equity awards granted to key employees, senior officers, and non-employee directors.

During 2023 and 2022, such stock-based compensation expense includes $ 2 million and $ 3 million which has been

classified within Restructuring on the Consolidated Statements of Income.

During 2024, 2023, and 2022 such stock-based compensation expense includes $ 1 million, $ 2 million, and $ 3 million which has been classified within Restructuring on the Consolidated Statements of Income.

The Company recognized $ 11 million, $ 9 million, and $ 12 million of tax benefits associated with stock-based compensation during 2024, 2023, and 2022.

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Employee Stock Purchase Plan

The Company has an employee stock purchase plan which allows eligible employees to purchase common shares of Company stock through payroll deductions at a 10 % discount from the fair market value at the grant date.

The Company issued 0.2 million, 0.3 million, and 0.1 million shares during 2023, 2022, and 2021 and recognized $ 1 million of compensation expense related to grants under this plan in each period.

The Company has an employee stock purchase plan which allows eligible employees to purchase common shares of Company stock through payroll deductions at a 10 % discount off the fair market value at the grant date.

The Company issued 0.2 million, 0.2 million, and 0.3 million shares under this plan during 2024, 2023, and 2022 and recognized $ 1 million of compensation expense for each of these issuances.

The value of shares issued under this plan was $ 9 million, $ 10 million, and $ 9 million during 2024, 2023, and 2022.

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The Company had $ 5 million and $ 6 million of net pension liability as of December 31, 2024 and 2023, included within Accrued expenses and other liabilities on the Consolidated Balance Sheets.

The Company had $ 1 million of unrecognized gains as of December 31, 2023;

The Company had $ 1 million of

unrecognized gains as of both December 31, 2024 and 2023;

which were included within Accumulated other comprehensive loss on the Consolidated Balance Sheets.

There were no unrecognized gains as of December 31, 2022.

The Company’s policy is to contribute amounts sufficient to meet minimum funding requirements as set forth in employee benefit and tax laws and additional amounts that the Company determines to be appropriate.

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Vacation Ownership and Travel and Membership.

The reportable segments presented below are those for which discrete financial information is available and which are utilized on a regular basis by the chief operating decision maker to assess performance and to allocate resources.

In identifying its reportable segments, the Company also considers the nature of services provided by its operating segments.

Management uses Adjusted EBITDA to assess the performance of the reportable segments.

Adjusted EBITDA is defined by the Company as Net income from continuing operations before depreciation and amortization, interest expense (excluding consumer financing interest), early extinguishment of debt, interest income (excluding consumer financing revenues) and income taxes.

Adjusted EBITDA also excludes stock-based compensation costs, separation and restructuring costs, legacy items, transaction costs for acquisitions and divestitures, asset impairments/recoveries, gains and losses on sale/disposition of business, and items that meet the conditions of unusual and/or infrequent.

Legacy items include the resolution of and adjustments to certain contingent assets and liabilities related to acquisitions of continuing businesses and dispositions, including the separation of Wyndham Hotels and Cendant, and the sale of the vacation rentals businesses.

In identifying its reportable segments the Company analyzed the components of each segment, the nature of the segments’ products and services, and prescribed quantitative thresholds.

The Vacation Ownership segment develops, markets, and sells VOIs to individual consumers, provides consumer financing in connection with the sale of VOIs, and provides property management services at resorts.

This segment is wholly comprised of the Vacation Ownership business line.

The Travel and Membership segment operates a variety of travel businesses, including vacation exchange brands, travel technology platforms, travel memberships, and direct-to-consumer rentals.

This segment is comprised of the Exchange and Travel Club business lines.

The financial results of these reportable segments are regularly reviewed by the Company’s Chief Executive Officer (“CEO”) to evaluate performance and allocate resources.

Since the Company’s CEO makes key operating and resource allocation decisions, the CEO is considered the Company’s Chief Operating Decision Maker (“CODM”).

Adjusted EBITDA is the profitability measure utilized by the CODM to assess the performance of the reportable segments through comparisons to budgets, forecasts, prior periods, and trends.

This analysis is used to make certain decisions regarding the allocation of capital and personnel to the segments.

During the third quarter of 2024, the Company updated its definition of Adjusted EBITDA to exclude certain non-recurring costs directly incurred to integrate mergers and/or acquisitions into its existing business as these costs do not reflect recurring operating expenses.

This change was made as a result of the Company’s acquisition of Accor Vacation Club.

As this business is being further integrated into the Company’s operations, it has begun incurring certain discrete non-recurring costs directly attributable to integration activities and the Company believes excluding these types of costs would assist investors in understanding its ongoing performance when considered with GAAP measures.

As a result of this change, Adjusted EBITDA is now defined by the Company as net income from continuing operations before depreciation and amortization, interest expense (excluding consumer financing interest), early extinguishment of debt, interest income (excluding consumer financing revenues) and income taxes.

Adjusted EBITDA also excludes stock-based compensation costs, separation and restructuring costs, legacy items, transaction and integration costs associated with mergers, acquisitions, and divestitures, asset impairments/recoveries, gains and losses on sale/disposition of business, and items that meet the conditions of unusual and/or infrequent.

Legacy items include the resolution of and adjustments to certain contingent assets and liabilities related to acquisitions of continuing businesses and dispositions, including the separation of Wyndham Hotels and ABG, and the sale of the vacation rentals businesses.

The Company believes that Adjusted EBITDA is a useful measure of performance for its segments which, when considered with GAAP measures, the Company believes gives a more complete understanding of its operating performance.

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Year Ended December 31, 2024

Net revenues 2023 2022 2021

Vacation Ownership $ 3,041 $ 2,835 $ 2,423

Travel and Membership 711 735 714

Total reportable segments 3,752 3,570 3,137

Corporate and other (a)

Net revenues Vacation Ownership Travel and Membership Total

Revenues from external customers $ 3,171 (a)

$ 691 $ 3,862

Total Company $ 3,750 $ 3,567 $ 3,134

Year Ended December 31,

Reconciliation of Net income to Adjusted EBITDA 2023 2022 2021

Net income attributable to Travel + Leisure Co.

shareholders $ 396 $ 357 $ 308

(Gain)/loss on disposal of discontinued business, net of income taxes ( 5 ) ( 1 ) 5

Interest expense 251 195 198

Intersegment revenues — 4 4

3,171 695 3,866

Reconciliation of revenues

Other revenues (b)

Elimination of intersegment revenues ( 4 )

Total consolidated revenues $ 3,864

Property management expense 643 — (c)

Commissions 406 — (c)

General and administrative (e)

Sales administration 194 — (c)

Consumer financing interest 136 — (c)

Developer obligations (f)

Licensing fees 94 — (c)

Cost of sales 92 (g)

Fee-for-Service expenses

Contact center — (c)

Resort services — (c)

Other segment items (h)

Reportable segment Adjusted EBITDA

$ 764 $ 251 $ 1,015

Elimination of intersegment expenses 36

Other Adjusted EBITDA, net of intersegment expenses ( 122 )

Adjusted EBITDA $ 929

Reconciliation of Adjusted EBITDA Total

Adjusted EBITDA $ 929

Stock-based compensation ( 40 )

Restructuring (i)

Legacy items ( 11 )

Asset impairments, net ( 3 )

Acquisition and divestiture related costs ( 2 )

Fair value change in contingent consideration 7

Integration costs ( 1 )

Depreciation and amortization ( 115 )

Interest income

Interest expense ( 249 )

Income before income taxes 513

Provision for income taxes ( 135 )

Depreciation and amortization 112 119 124

Net income from continuing operations 378

Gain on disposal of discontinued business, net of income taxes 33

Net income attributable to Travel + Leisure Co.

shareholders $ 411

(a) Includes $ 432 million provision for loan losses, net.

(b) Represents revenue recognized at the Company's Corporate and other segment for managing an insurance program on behalf of homeowners associations.

(d) Excludes licensing fees which are reported within Marketing on the Consolidated Statements of Income, as it is separately disclosed.

(e) Excludes stock-based compensation and legacy items which are not included in the determination of Adjusted EBITDA.

(f) Represents maintenance fees incurred by the Company for unsold VOIs, net of monetization.

(g) Represents Cost of vacation ownership interests on the Consolidated Statements of Income.

(h) Includes expenses for VOI travel packages, VOI incentives, and professional fees reported within Operating expenses, and other non-operating income/expense items included in the determination of Adjusted EBITDA;

such as dividend income, business insurance proceeds, and asset sales.

(i) Includes $ 1 million of stock-based compensation expense associated with the 2022 restructuring plans.

Year Ended December 31, 2023

Net revenues Vacation Ownership Travel and Membership Total

Revenues from external customers $ 3,041 (a)

$ 704 $ 3,745

Intersegment revenues — 7 7

3,041 711 3,752

Reconciliation of revenues

Other revenues (b)

Elimination of intersegment revenues ( 7 )

Total consolidated revenues $ 3,750

Property management expense 607 — (c)

Commissions 358 — (c)

General and administrative (e)

Sales administration 179 — (c)

Cost of sales 132 (f)

Developer obligations (g)

Consumer financing interest

Licensing fees 89 — (c)

Fee-for-Service expenses 81 — (c)

Contact center — (c)

Resort services — (c)

Other segment items (h)

Reportable segment Adjusted EBITDA

$ 729 $ 247 $ 976

Elimination of intersegment expenses 6

Other Adjusted EBITDA, net of intersegment expenses ( 74 )

Adjusted EBITDA $ 908

Reconciliation of Adjusted EBITDA Total

Adjusted EBITDA $ 908

Stock-based compensation ( 36 )

Restructuring (b)

Restructuring (i)

Legacy items ( 8 )

Loss on sale of business ( 2 )

Asset impairments/(recoveries), net (c)

Loss/(gain) on equity investment — 5 ( 3 )

COVID-19 related costs (d)

Fair value change in contingent consideration — ( 10 ) —

Adjusted EBITDA $ 908 $ 859 $ 778

Asset impairments, net (j)

Depreciation and amortization ( 112 )

Interest income

Interest expense ( 251 )

Income before income taxes 485

Provision for income taxes ( 94 )

Net income from continuing operations 391

Gain on disposal of discontinued business, net of income taxes 5

Net income attributable to Travel + Leisure Co.

shareholders $ 396

(a) Includes $ 348 million provision for loan losses, net.

(b) Represents revenue recognized at the Company's Corporate and other segment for managing an insurance program on behalf of homeowners associations.

(d) Excludes licensing fees which are reported within Marketing on the Consolidated Statements of Income as it is separately disclosed.

(e) Excludes stock-based compensation and legacy items which are not included in the determination of Adjusted EBITDA.

(f) Represents Cost of vacation ownership interests on the Consolidated Statements of Income, excluding $ 1 million of inventory impairments which are not included in the determination of Adjusted EBITDA.

(g) Represents maintenance fees incurred by the Company for unsold VOIs, net of monetization.

such as dividend income, business insurance proceeds, and asset sales.

(i) Includes $ 2 million of stock-based compensation expense associated with the 2023 restructuring plans.

(j) Includes $ 1 million of inventory impairments reported within Cost of vacation ownership interests on the Consolidated Statements of Income.

Year Ended December 31, 2022

Adjusted EBITDA 2023 2022 2021

Vacation Ownership $ 729 $ 665 $ 569

Travel and Membership 247 268 271

Total reportable segments 976 933 840

Corporate and other (a)

Net revenues Vacation Ownership Travel and Membership Total

Revenues from external customers $ 2,835 (a)

$ 732 $ 3,567

Total Company $ 908 $ 859 $ 778

(a) Includes the elimination of transactions between segments.

(b) Includes $ 2 million and $ 3 million of stock-based compensation expense for the years ended December 31, 2023 and 2022 associated with the 2023 and 2022 restructuring plans.

(c) Includes $ 1 million of inventory impairments for the years ended December 31, 2023 and 2022, included in Cost of vacation ownership interests on the Consolidated Statements of Income.

(d) Includes expenses related to COVID-19 testing and other expenses associated with the Company’s return-to-work program in 2022.

In 2021, this includes incremental severance and other employee costs associated with layoffs due to the COVID-19 workforce reduction offset in part by U.S.

and international government employee retention credits.

Intersegment revenues — 3 3

2,835 735 3,570

Reconciliation of revenues

Elimination of intersegment revenues ( 3 )

Total consolidated revenues $ 3,567

Property management expense 564 — (b)

Commissions 344 — (b)

General and administrative (d)

Sales administration 162 — (b)

Cost of sales

Developer obligations (f)

Licensing fees 83 — (b)

Consumer financing interest

Fee-for-Service expenses

Contact center — (b)

Resort services — (b)

Other segment items (g)

Reportable segment Adjusted EBITDA

$ 665 $ 268 $ 933

Elimination of intersegment expenses 3

Other Adjusted EBITDA, net of intersegment expenses ( 77 )

Adjusted EBITDA $ 859

Reconciliation of Adjusted EBITDA Total

Adjusted EBITDA $ 859

Stock-based compensation ( 42 )

Restructuring (h)

Asset impairments, net (i)

Loss on equity investment ( 5 )

COVID-19 related costs (j)

Legacy items ( 1 )

Fair value change in contingent consideration 10

Depreciation and amortization ( 119 )

Interest income

Interest expense ( 195 )

Income before income taxes 486

Provision for income taxes ( 130 )

Net income from continuing operations 356

Gain on disposal of discontinued business, net of income taxes 1

Net income attributable to Travel + Leisure Co.

shareholders $ 357

(a) Includes $ 302 million provision for loan losses, net.

(b) Expense category not regularly provided to the CODM for this segment.

(c) Excludes licensing fees which are reported in Marketing on the Consolidated Statements of Income, as it is separately disclosed.

(d) Excludes stock-based compensation, legacy items, and COVID-19 related costs which are not included in the determination of Adjusted EBITDA.

(e) Represents Cost of vacation ownership interests on the Consolidated Statements of Income, excluding $ 1 million of inventory impairments which are not included in the determination of Adjusted EBITDA.

(f) Represents maintenance fees incurred by the Company for unsold VOIs, net of monetization.

(g) Includes expenses for VOI travel packages, VOI incentives, and professional fees reported within Operating expenses, and other non-operating income/expense items included in the determination of Adjusted EBITDA;

such as dividend income, business insurance proceeds, and asset sales.

(h) Includes $ 3 million of stock-based compensation expense associated with the 2022 restructuring plan.

(i) Includes $ 1 million of inventory impairments reported within Cost of vacation ownership interests on the Consolidated Statements of Income.

(j) Includes expenses related to COVID-19 testing and other expenses associated with the Company’s return-to-work program in 2022.

The following tables present the Company’s segment asset information (in millions):

As of December 31,

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These costs are included within COVID-19 related costs on the Consolidated Statements of Income.

For the year ended December 31, 2021, the Company’s financial statements included impacts directly related to COVID-19 as detailed in the table below (in millions):

Vacation Ownership Travel and Membership Corporate Consolidated Income Statement Classification

Allowance for loan losses:

Provision $ ( 91 ) $ — $ — $ ( 91 ) Vacation ownership interest sales

Recoveries 33 — — 33 Cost of vacation ownership interests

Asset recoveries — ( 6 ) — ( 6 ) Asset impairments/(recoveries), net

Lease-related ( 1 ) — — ( 1 ) Restructuring

Employee compensation related and other 3 — 1 4 COVID-19 related costs

Total COVID-19 $ ( 56 ) $ ( 6 ) $ 1 $ ( 61 )

Allowance for loan losses — Due to the economic downturn resulting from COVID-19 during 2020, the Company evaluated the potential impact of COVID-19 on its owners’ ability to repay their contract receivables and as a result of higher unemployment, the Company recorded a COVID-19 related allowance for loan losses during 2020.

During 2021, the Company analyzed the adequacy of this 2020 COVID-19 related allowance consistent with past methodology, and due to the improvement in net new defaults the Company reduced this allowance resulting in an increase of $ 91 million to Vacation ownership interest sales and a corresponding increase of $ 33 million to Cost of vacation ownership interests.

The net positive impact of these adjustments on Adjusted EBITDA was $ 58 million for the year ended December 31, 2021.

Asset recoveries — During 2021, the Company reversed $ 6 million of asset impairments related to its equity investment in Vacasa LLC (“Vacasa”) previously impaired in 2020.

Employee compensation related and other — During 2021, these costs included $ 3 million of professional and other costs and $ 1 million of severance and other employee costs resulting from layoffs, salary, and benefits continuation at the Vacation Ownership segment.

These costs were inclusive of $ 2 million of employee retention credits earned in connection with government programs for the year ended December 31, 2021.

In connection with COVID-19 related actions taken by the Company, it recorded employee-related liabilities which are included within Accrued expenses and other liabilities on the Consolidated Balance Sheets.

The activity associated with these COVID-19 related liabilities is summarized as follows (in millions):

Liability as of 2021 Activity Liability as of

December 31, 2020 Costs Recognized Cash Payments December 31, 2021

COVID-19 employee-related $ 6 $ 1 $ ( 6 ) $ 1

Ending balance $ 6 $ 1 $ ( 6 ) $ 1

Liability as of 2022 Activity Liability as of

December 31, 2021 Costs Recognized Cash Payments December 31, 2022

COVID-19 employee-related $ 1 $ 2 $ ( 3 ) $ —

Ending balance $ 1 $ 2 $ ( 3 ) $ —

Impairments and Other Charges

During 2022, the Company recorded $ 10 million of impairments within Asset impairments/(recoveries), net on the Consolidated Statements of Income.

These impairments include a $ 9 million loss on the sale at the Vacation Ownership segment related to certain property sold for $ 22 million, made up of $ 17 million in cash and a $ 5 million promissory note.

During 2024, the Company recorded $ 3 million of impairments within Asset impairments, net on the Consolidated Statements of Income.

These impairments include $ 1 million related to held-for-sale assets, $ 1 million trademark impairment, and $ 1 million impairment of cloud computing arrangements at the Travel and Membership segment.

During 2022, the Company recorded $ 10 million of impairments within Asset impairments, net on the Consolidated Statements of Income.

These impairments included a $ 9 million loss on the sale at the Vacation Ownership segment related to certain property sold for $ 22 million, made up of $ 17 million in cash and a $ 5 million promissory note.

The Company also recorded a $ 2 million impairment of fixed assets at the Vacation Ownership segment and a $ 2 million trade name impairment at the Travel and Membership segment.

These impairments were offset by $ 3 million of asset recoveries, primarily related to previously impaired land which was sold during 2022.

During 2021, the Company had net asset recoveries of $ 5 million driven by the $ 6 million reversal of a 2020 COVID-19 related impairment of the Vacasa equity investment at the Travel and Membership segment.

This reversal was partially offset by less than $ 1 million of impairments at the Vacation Ownership segment.

This activity was recorded within Asset impairments/(recoveries), net on the Consolidated Statements of Income.

Other Charges

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2024 Restructuring Plan

During 2024, the Company incurred $ 15 million of restructuring charges associated with the 2024 restructuring plan.

These actions were primarily focused on enhancing organizational efficiency and rationalizing operations.

These charges included personnel-related costs resulting from a reduction of approximately 300 employees and other expenses.

The 2024 restructuring plan charges consisted of (i) $ 10 million of personnel-related costs at the Travel and Membership segment, (ii) $ 3 million of personnel-related costs at the Company’s corporate operations, and (iii) $ 2 million of personnel-related costs at the Vacation Ownership segment.

All material initiative and related expenses have been incurred as of December 31, 2024.

The 2024 restructuring liability was reduced by $ 7 million of cash payments during the year ended December 31, 2024.

The remaining 2024 restructuring liability of $ 8 million is expected to be paid by the end of 2026.

2023 Restructuring Plan

During 2023, the Company incurred $ 26 million of restructuring charges.

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These restructuring charges included $ 2 million of accelerated stock-based compensation expense, which is included within Additional paid-in capital on the Consolidated Balance Sheets.

All material initiative and related expenses have been incurred as of December 31, 2023.

The Company reduced the 2023 restructuring liability by $ 8 million of cash payments during the year ended December 31, 2023.

The remaining 2023 restructuring liability of $ 15 million is expected to be paid by the end of 2025.

The 2023 restructuring liability was reduced by $ 14 million and $ 8 million of cash payments during the years ended December 31, 2024 and 2023.

The remaining 2023 restructuring liability of less than $ 1 million is expected to be paid by the end of 2025.

2022 Restructuring Plan

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These restructuring charges included $ 3 million of accelerated stock-based compensation expense, which is included within Additional paid-in capital on the Consolidated Balance Sheets.

The 2022 restructuring liability was reduced by $ 7 million and $ 5 million of cash payments during the

years ended December 31, 2023 and 2022.

The remaining 2022 restructuring liability of less than $ 1 million is personnel-related and is expected to be paid by the end of 2024.

The Company has additional restructuring plans which were implemented prior to 2021, most of which were COVID-19 related.

During 2024, the Company recognized an additional $ 1 million of stock-based compensation expense associated with the 2022 restructuring plan.

The 2022 restructuring liability was reduced by $ 1 million, $ 7 million, and $ 5 million of cash payments during the years ended December 31, 2024, 2023, and 2022.

As of December 31, 2024, the 2022 restructuring liability has been fully settled.

The Company has an additional restructuring plan which was implemented prior to 2022, all of which is related to leased facilities.

This restructuring liability was reduced by $ 3 million, $ 2 million, and $ 3 million of cash payments during the years ended December 31, 2024, 2023, and 2022.

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Facility-related $ 22 $ 1 $ ( 4 ) $ 1 $ 20

Marketing-related 2 ( 1 ) (a)

Personnel-related 1 — ( 1 ) — —

Personnel-related — 13 ( 4 ) ( 3 ) (a)

$ 22 $ 14 $ ( 8 ) $ ( 2 ) $ 26

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Facility-related $ 20 $ 1 $ ( 4 ) $ — $ 17

Personnel-related — 13 ( 4 ) ( 3 ) (c)

Personnel-related 6 25 ( 13 ) ( 2 ) (a)

$ 26 $ 26 $ ( 17 ) $ ( 2 ) $ 33

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Facility-related $ 17 $ 1 $ ( 3 ) $ — $ 15

Personnel-related 6 25 ( 13 ) ( 2 ) (c)

Personnel-related 16 15 ( 22 ) ( 1 ) (a)

$ 33 $ 16 $ ( 25 ) $ ( 1 ) $ 23

(a) Includes $ 1 million reversal of expense related to the reimbursement of prepaid licensing fees that were previously written-off at the Vacation Ownership segment.

(b) Includes $ 2 million reimbursement of termination payments and $ 1 million reimbursement of license fees at the Vacation Ownership segment.

(c) Represents accelerated stock-based compensation expense included in Additional paid-in capital on the Consolidated Balance Sheets.

(a) Represents stock-based compensation expense included in Additional paid-in capital on the Consolidated Balance Sheets.

Transactions with Former Parent and Former Subsidiaries

Matters Related to Cendant

Pursuant to the Separation and Distribution Agreement with Cendant (the Company’s former parent company, now Avis Budget Group), the Company entered into certain guarantee commitments with Cendant and Cendant’s former subsidiary, Realogy (now Anywhere Real Estate Inc.).

These guarantee arrangements primarily relate to certain contingent litigation liabilities, contingent tax liabilities, and Cendant contingent and other corporate liabilities, of which Wyndham Worldwide Corporation assumed 37.5 % of the responsibility while Cendant’s former subsidiary Realogy is responsible for the remaining 62.5 %.

In connection with the Spin-off, Wyndham Hotels agreed to retain one-third of Cendant’s contingent and other corporate liabilities and associated costs;

Matters Related to Former Parent

Pursuant to the Separation and Distribution Agreement with the Company’s former parent, Avis Budget Group, Inc.

(“ABG”), formerly Cendant Corporation, the Company entered into certain guarantee commitments with ABG and ABG’s former subsidiary, Anywhere Real Estate Inc.(formerly Realogy).

These guarantee arrangements primarily relate to certain contingent litigation liabilities, contingent tax liabilities, and ABG contingent and other corporate liabilities, of which Wyndham Worldwide Corporation assumed 37.5 % of the responsibility while ABG’s former subsidiary Anywhere Real Estate Inc.

is responsible for the remaining 62.5 %.

In connection with the Spin-off, Wyndham Hotels agreed to retain one-third of ABG’s contingent and other corporate liabilities and associated costs;

therefore, Travel + Leisure Co.

is effectively responsible for 25 % of such matters subsequent to the separation.

Since Cendant’s separation, Cendant has settled the majority of the lawsuits that were pending on the date of the separation.

On March 21, 2023, the California Office of Tax Appeals (“OTA”) issued an opinion on a Cendant legacy tax matter involving Avis Budget Group related to a 1999 transaction.

Since ABG’s separation, ABG has settled the majority of the lawsuits that were pending on the date of the separation.

On March 21, 2023, the California Office of Tax Appeals (“OTA”) issued an opinion on a legacy tax matter involving ABG related to a 1999 transaction.

The matter concerned (i) whether the statute of limitations barred proposed assessment notices issued by the California Franchise Tax Board;

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The OTA ruled in favor of the California Franchise Tax Board.

During 2023 the Company increased the reserve by $ 8 million for this legacy tax matter, one-third of which is the responsibility of Wyndham Hotels.

The OTA’s opinion is not final, and during the second quarter of 2023 Cendant filed a petition for rehearing.

As of December 31, 2023, Cendant’s petition was still pending.

As of December 31, 2023 and 2022 the Cendant separation and related liabilities were $ 23 million and $ 15 million, all of which were tax related liabilities.

During the second quarter of 2023, ABG filed a petition for rehearing.

On April 10, 2024, ABG’s petition was denied and the Company is currently awaiting final notice for the required payment, one third of which is the responsibility of Wyndham Hotels.

As of December 31, 2024 and 2023, the ABG separation and related liabilities were $ 24 million and $ 23 million, all of which were tax related liabilities.

These liabilities are included within Accrued expenses and other liabilities on the Consolidated Balance Sheets.

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In connection with the Spin-off on May 31, 2018, Travel + Leisure Co.

entered into several agreements with Wyndham Hotels that govern the relationship of the parties following the separation including the Separation and Distribution Agreement, the Employee Matters Agreement, the Tax Matters Agreement, the Transition Services Agreement and the License, Development and Noncompetition Agreement.

entered into several agreements with Wyndham Hotels that govern the relationship of the parties following the separation.

The current ongoing agreements include the Separation and Distribution Agreement, the Employee Matters Agreement, the Tax Matters Agreement, and the License, Development and Noncompetition Agreement.

The Company and Wyndham Hotels entered into a letter agreement during 2021 pursuant to which, among other things Wyndham Hotels waived its right to enforce certain noncompetition covenants in the License, Development and Noncompetition Agreement.

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In addition, the Company agreed to indemnify Awaze against certain claims and assessments, including income tax, value-added tax and other tax matters, related to the operations of the European vacation rentals business for the periods prior to the transaction.

During 2023, one of the guarantees under this agreement expired resulting in the Company recognizing $ 5 million within Gain on disposal of discontinued business, net of income taxes, with an offsetting $ 2 million expense, representing Wyndham Hotels one-third share, included within General and administrative expense on the Consolidated Statements of Income.

The estimated fair value of the indemnifications was $ 36 million at December 31, 2023.

The Company has a $ 12 million receivable from Wyndham Hotels for its portion of the guarantee.

During 2023, one of the guarantees under this agreement expired resulting in the Company recognizing $ 5 million within Gain on disposal of discontinued business, net of income taxes, with an offsetting $ 2 million of expense, representing Wyndham Hotels one-third share, included within General and administrative expense on the Consolidated Statements of Income.

During the second quarter of 2024, the remaining indemnifications expired which resulted in the recognitions of a $ 32 million Gain on disposal of discontinued business, net of income taxes, with an offsetting $ 12 million of expense, representing Wyndham Hotels one-third share, included within General and administrative expense on the Consolidated Statements of Income.

Wyndham Hotels provided certain post-closing credit support primarily for the benefit of a British travel association in the form of guarantees which are mainly denominated in pound sterling of up to £ 61 million ($ 81 million USD) on a perpetual basis.

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is responsible for two-thirds of these guarantees.

As part of this agreement Wyndham Hotels is required to maintain minimum credit ratings which increased to Ba1 for Moody’s and BB+ for S&P on May 9, 2020.

If Wyndham Hotels drops below these minimum credit ratings, Travel + Leisure Co.

would be required to post a letter of credit (or equivalent support) for the amount of the Wyndham Hotels guarantee.

The estimated fair value of the guarantees and indemnifications for which Travel + Leisure Co.

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one-third of which was the responsibility of Wyndham Hotels.

During the third quarter of 2022, the Company made this settlement payment which was included within Net cash used in investing activities from discontinued operations on the Consolidated Statements of Cash Flows, and received $ 2 million from Wyndham Hotels for their one-third portion which was included within Net cash provided by operating activities on the Consolidated Statements of Cash Flows.

During 2022, the Company made this settlement payment which was included within Net cash provided by/(used in) investing activities from discontinued operations on the Consolidated Statements of Cash Flows and received $ 2 million from Wyndham Hotels for their one-third portion which was included within Net cash provided by operating activities on the Consolidated Statements of Cash Flows.

This matter is now resolved and no further payments are required.

Matters Related to the North American Vacation Rentals Business

In connection with the sale of the North American vacation rentals business, the Company agreed to indemnify Vacasa against certain claims and assessments, including income tax and other tax matters related to the operations of the North American vacation rentals business for the periods prior to the transaction.

In connection with the sale of the North American vacation rentals business, the Company agreed to indemnify Vacasa LLC against certain claims and assessments, including income tax and other tax matters related to the operations of the

North American vacation rentals business for the periods prior to the transaction.

The estimated fair value of the indemnifications was $ 2 million, which was included in Accrued expenses and other liabilities on the Consolidated Balance Sheets as of December 31, 2024.

In connection with the sale of the North American vacation rentals business in the fourth quarter of 2019, the Company entered into a transition service agreement with Vacasa, pursuant to which the companies agreed to provide each other certain transitional services including human resources, facilities, payroll, information technology, information management and related services, treasury, and finance on an interim, transitional basis.

During 2021, transition service agreement expenses were less than $ 1 million and transition service agreement income was less than $ 1 million.

Transition service agreement expenses were included in General and administrative expense and transition service income was included in Other revenue on the Consolidated Statements of Income.

These transition services ended in February 2021.

Related Party Transactions

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The Company incurred less than $ 1 million of expenses related to this timesharing arrangement during the years ended December 31, 2024, 2023, and 2022.

During 2021, the Company sold a parcel of land in Crossville, Tennessee, which was no longer core to the Company’s operations to a former executive of the Company for less than $ 1 million.

In 2019, the Company entered into an agreement with a former executive of the Company whereby the former executive through an SPE would develop and construct VOI inventory located in Orlando, Florida.

In 2020, the Company acquired the completed vacation ownership property for $ 45 million.

This agreement was subsequently amended during 2021, increasing the purchase to $ 47 million.

Subsequent Events

On January 30, 2024, the Company announced an agreement to acquire the vacation ownership business of Accor, for $ 48 million.

Accor Vacation Club represents 24 resorts and nearly 30,000 members.

This acquisition will help the two companies establish a relationship to develop new timeshare products in the Asia Pacific, Middle East, Africa, and Türkiye regions under the Accor Vacation Club brand leveraging the Travel + Leisure Co.

global platform.

Accor will receive a percentage of vacation ownership sales revenue as a licensing fee under the exclusive licensing agreement.

Travel + Leisure Co.

also receives the exclusive rights to develop new vacation ownership clubs and products utilizing the Accor Vacation Club brand.

The acquisition will be included within the Vacation Ownership segment.

During 2024, the Company entered into a consulting agreement with a former executive.

The Company incurred expenses of less than $ 1 million related to this agreement, which was concluded as of December 31, 2024.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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-K

Item 8. Financial Statements and Supplementary Data