Travel & Leisure Co. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA INDEX TO ANNUAL CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm ( PCAOB ID No. 34 ) 54 Consolidated Statements of Income for the years ended December 31, 202 5 , 202 4 , and 20 23 56 Consolidated Statements of Comprehensive Income for the years ended December 31, 202 5 , 202 4 , and 20 23 57 Consolidated Balance Sheets as of December 31, 202 5 and 202 4 58 Consolidated Statements of Cash Flows for the years ended December 31, 202 5 , 202 4 , and 20 23 59 Consolidated Statements of Deficit for the years ended December 31, 202 5 , 202 4 , and 20 23 60 Notes to Consolidated Financial Statements 61 1. Background and Basis of Presentation 61 2. Summary of Significant Accounting Policies 61 3. Revenue Recognition 66 4. Earnings Per Share 70 5. Acquisitions 71 6. Discontinued Operations 72 7. Intangible Assets 72 8. Income Taxes 73 9. Vacation Ownership Contract Receivables 77 10. Inventory 79 11. Property and Equipment 80 12. Leases 80 13. Other Assets 82 14. Accrued Expenses and Other Liabilities 83 15. Debt 83 16. Variable Interest Entities 87 17. Fair Value 88 18. Financial Instruments 89 19. Commitments and Contingencies 91 20. Accumulated Other Comprehensive Loss 93 21. Stock-Based Compensation 93 22. Employee Benefit Plans 95 23. Segment Information 95 24. Impairments and Other Charges 100 25. Restructuring 101 26. Transactions with Former Parent and Former Subsidiaries 102 27. Related Party Transactions 104 28. Subsequent Events 104 53 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Travel + Leisure Co. Orlando, Florida Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Travel + Leisure Co. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, cash flows, and deficit for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. Basis for Opinions The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting . Our responsibility is to express an opinion on these financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 54 Table of Contents Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Allowance for Loan Losses - Refer to Notes 2 and 9 in the financial statements Critical Audit Matter Description 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 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 judgment. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the vacation ownership interest allowance for loan loss included the following, among others: • 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. • We tested the accuracy and evaluated the relevance of the historical loss data as an input to the static pool model. • 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 model through analyzing the results of a look-back analysis. /s/ Deloitte & Touche LLP Tampa, Florida February 18, 2026 We have served as the Company's auditor since 2005. 55 Table of Contents TRAVEL + LEISURE CO. CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share amounts) Year Ended December 31, 2025 2024 2023 Net revenues Vacation ownership interest sales $ 1,847 $ 1,721 $ 1,582 Service and membership fees 1,615 1,607 1,649 Consumer financing 454 450 427 Other 105 86 92 Net revenues 4,021 3,864 3,750 Expenses Operating 1,824 1,744 1,684 Marketing 585 550 507 General and administrative 498 475 454 Cost of vacation ownership interests 273 92 133 Consumer financing interest 135 136 112 Depreciation and amortization 124 115 112 Restructuring 19 16 26 Asset impairments, net 10 3 — Total expenses 3,468 3,131 3,028 Loss on sale of business — — 2 Operating income 553 733 720 Interest expense 232 249 251 Other (income), net ( 7 ) ( 15 ) ( 3 ) Interest (income) ( 9 ) ( 14 ) ( 13 ) Income before income taxes 337 513 485 Provision for income taxes 107 135 94 Net income from continuing operations 230 378 391 Gain on disposal of discontinued business, net of income taxes — 33 5 Net income attributable to Travel + Leisure Co. shareholders $ 230 $ 411 $ 396 Basic earnings per share Continuing operations $ 3.51 $ 5.39 $ 5.24 Discontinued operations — 0.48 0.07 $ 3.51 $ 5.87 $ 5.31 Diluted earnings per share Continuing operations $ 3.44 $ 5.35 $ 5.21 Discontinued operations — 0.47 0.07 $ 3.44 $ 5.82 $ 5.28 See Notes to Consolidated Financial Statements. 56 Table of Contents TRAVEL + LEISURE CO. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ( In millions ) Year Ended December 31, 2025 2024 2023 Net income attributable to Travel + Leisure Co. shareholders $ 230 $ 411 $ 396 Foreign currency translation adjustments, net of tax 46 ( 42 ) 8 Defined benefit pension plans, net of tax — — 1 Other comprehensive income/(loss), net of tax 46 ( 42 ) 9 Comprehensive income attributable to Travel + Leisure Co. shareholders $ 276 $ 369 $ 405 See Notes to Consolidated Financial Statements. 57 Table of Contents TRAVEL + LEISURE CO. CONSOLIDATED BALANCE SHEETS (In millions, except share data) As of December 31, 2025 2024 Assets Cash and cash equivalents $ 253 $ 167 Restricted cash (VIE - $ 87 as of 2025 and $ 92 as of 2024) 173 162 Trade receivables, net 165 155 Vacation ownership contract receivables, net (VIE - $ 2,281 as of 2025 and $ 2,293 as of 2024) 2,638 2,619 Inventory 1,128 1,227 Prepaid expenses 214 214 Property and equipment, net 531 591 Goodwill 972 966 Other intangibles, net 201 209 Other assets 485 425 Total assets $ 6,760 $ 6,735 Liabilities and (deficit) Accounts payable $ 62 $ 67 Accrued expenses and other liabilities 910 778 Deferred income 468 457 Non-recourse vacation ownership debt (VIE) 2,124 2,123 Debt 3,474 3,468 Deferred income taxes 704 722 Total liabilities 7,742 7,615 Commitments and contingencies (Note 19) Stockholders' (deficit): Preferred stock, $ 0.01 par value, authorized 6,000,000 shares, none issued and outstanding — — Common stock, $ 0.01 par value, 600,000,000 shares authorized, 225,937,948 issued as of 2025 and 224,599,556 as of 2024 3 2 Treasury stock, at cost – 162,880,360 shares as of 2025 and 157,476,502 shares as of 2024 ( 7,735 ) ( 7,433 ) Additional paid-in capital 4,405 4,328 Retained earnings 2,412 2,334 Accumulated other comprehensive loss ( 66 ) ( 112 ) Total stockholders’ (deficit) ( 981 ) ( 881 ) Noncontrolling interest ( 1 ) 1 Total (deficit) ( 982 ) ( 880 ) Total liabilities and (deficit) $ 6,760 $ 6,735 See Notes to Consolidated Financial Statements. 58 Table of Contents TRAVEL + LEISURE CO. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) Year Ended December 31, 2025 2024 2023 Operating activities Net income $ 230 $ 411 $ 396 Gain on disposal of discontinued business, net of income taxes — ( 33 ) ( 5 ) Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses 484 432 348 Inventory write-downs and impairments 216 — — Depreciation and amortization 124 115 112 Stock-based compensation 57 41 38 Non-cash interest 24 25 22 Non-cash lease expense 13 12 16 Asset impairments, net 10 3 — Loss on sale of business — — 2 Deferred income taxes ( 21 ) 26 8 Other, net ( 8 ) ( 1 ) ( 3 ) Net change in assets and liabilities, excluding impact of acquisitions and dispositions: Trade receivables 3 35 ( 18 ) Vacation ownership contract receivables ( 503 ) ( 549 ) ( 504 ) Inventory ( 68 ) ( 16 ) 25 Prepaid expenses 2 14 ( 27 ) Other assets ( 24 ) ( 42 ) ( 20 ) Accounts payable, accrued expenses, and other liabilities 96 ( 19 ) ( 70 ) Deferred income 5 10 30 Net cash provided by operating activities 640 464 350 Investing activities Property and equipment additions ( 117 ) ( 81 ) ( 74 ) Proceeds from sale of investments 21 — — Purchases of investments ( 19 ) — — Acquisitions, net of cash acquired ( 1 ) ( 44 ) ( 6 ) Proceeds from sale of assets 10 1 — Other, net ( 1 ) ( 1 ) — Net cash used in investing activities - continuing operations ( 107 ) ( 125 ) ( 80 ) Net cash provided by investing activities - discontinued operations — 1 — Net cash used in investing activities ( 107 ) ( 124 ) ( 80 ) Financing activities Proceeds from non-recourse vacation ownership debt 1,707 1,805 1,926 Principal payments on non-recourse vacation ownership debt ( 1,715 ) ( 1,743 ) ( 1,823 ) Proceeds from debt, notes issued, and term loans 2,673 1,910 2,031 Principal payments on debt, notes, and term loans ( 2,676 ) ( 2,031 ) ( 2,146 ) Repurchase of common stock ( 301 ) ( 234 ) ( 309 ) Dividends to shareholders ( 149 ) ( 142 ) ( 136 ) Debt issuance/modification costs ( 27 ) ( 20 ) ( 22 ) Net share settlement of incentive equity awards ( 14 ) ( 9 ) ( 10 ) Payment of deferred acquisition consideration — ( 9 ) ( 14 ) Repayments of vacation ownership inventory arrangement — — ( 6 ) Proceeds from vacation ownership inventory arrangement 25 — — Proceeds from issuance of common stock 34 15 9 Net cash used in financing activities ( 443 ) ( 458 ) ( 500 ) Effect of changes in exchange rates on cash, cash equivalents and restricted cash 7 ( 11 ) — Net change in cash, cash equivalents and restricted cash 97 ( 129 ) ( 230 ) Cash, cash equivalents and restricted cash, beginning of period 329 458 688 Cash, cash equivalents and restricted cash, end of period 426 329 458 Less: Restricted cash 173 162 176 Cash and cash equivalents $ 253 $ 167 $ 282 See Notes to Consolidated Financial Statements. 59 Table of Contents TRAVEL + LEISURE CO. CONSOLIDATED STATEMENTS OF DEFICIT (In millions, except per share amounts) Common Shares Outstanding Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Non-controlling Interest Total Deficit Balance as of December 31, 2022 78.4 $ 2 $ ( 6,886 ) $ 4,242 $ 1,808 $ ( 79 ) $ 9 $ ( 904 ) Net income — — — — 396 — — 396 Other comprehensive income — — — — — 9 — 9 Issuance of shares for RSU vesting 0.6 — — — — — — — Net share settlement of stock-based compensation — — — ( 10 ) — — — ( 10 ) Employee stock purchase program issuances 0.2 — — 10 — — — 10 Change in stock-based compensation — — — 38 — — — 38 Repurchase of common stock ( 7.8 ) — ( 307 ) — — — — ( 307 ) Dividends ($ 1.80 per share) — — — — ( 137 ) — — ( 137 ) Non-controlling interest ownership change — — — — — — ( 8 ) ( 8 ) Other — — ( 3 ) ( 1 ) — — — ( 4 ) Balance as of December 31, 2023 71.4 2 ( 7,196 ) 4,279 2,067 ( 70 ) 1 ( 917 ) Net income — — — — 411 — — 411 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 ) Employee stock purchase program issuances 0.2 — — 9 — — — 9 Change in stock-based compensation — — — 41 — — — 41 Repurchase of common stock ( 5.2 ) — ( 235 ) — — — — ( 235 ) Dividends ($ 2.00 per share) — — — — ( 144 ) — — ( 144 ) Other — — ( 2 ) 2 — — — — Balance as of December 31, 2024 67.1 2 ( 7,433 ) 4,328 2,334 ( 112 ) 1 ( 880 ) Net income — — — — 230 — — 230 Other comprehensive income — — — — — 46 — 46 Stock option exercises 0.5 — — 24 — — — 24 Issuance of shares for RSU/PSU vesting 0.7 1 — — — — — 1 Net share settlement of stock-based compensation — — — ( 14 ) — — — ( 14 ) Employee stock purchase program issuances 0.2 — — 10 — — — 10 Change in stock-based compensation — — — 57 — — — 57 Repurchase of common stock ( 5.4 ) — ( 300 ) — — — — ( 300 ) Dividends ($ 2.24 per share) — — — — ( 152 ) — — ( 152 ) Non-controlling interest ownership change — — — — — — ( 2 ) ( 2 ) Other — — ( 2 ) — — — — ( 2 ) Balance as of December 31, 2025 63.1 $ 3 $ ( 7,735 ) $ 4,405 $ 2,412 $ ( 66 ) $ ( 1 ) $ ( 982 ) See Notes to Consolidated Financial Statements. 60 Table of Contents TRAVEL + LEISURE CO. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unless otherwise noted, all amounts are in millions, except per share amounts) 1. Background and Basis of Presentation Background Travel + Leisure Co. and its subsidiaries (collectively, “Travel + Leisure Co.,” or the “Company”) is a global provider of hospitality services and travel products. The Company has two reportable segments: Vacation Ownership and Travel and Membership. 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 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. Basis of Presentation The accompanying Consolidated Financial Statements in this Annual Report on Form 10-K include the accounts and transactions of Travel + Leisure Co., as well as the entities in which Travel + Leisure Co. directly or indirectly has a controlling financial interest. The accompanying Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). All intercompany balances and transactions have been eliminated in the Consolidated Financial Statements. The Company presents an unclassified balance sheet which conforms to that of the Company’s peers and industry practice. In presenting the Consolidated Financial Statements, management makes estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures. Estimates, by their nature, are based on judgment and available information. Accordingly, actual results could differ from those estimates and assumptions. In management’s opinion, the Consolidated Financial Statements contain all normal recurring adjustments necessary for a fair presentation of annual results reported. 2. Summary of Significant Accounting Policies PRINCIPLES OF CONSOLIDATION When evaluating an entity for consolidation, the Company first determines whether an entity is a variable interest entity (“VIE”). If the entity is deemed to be a VIE, the Company consolidates those VIEs for which the Company is the primary beneficiary. The Company will also consolidate an entity not deemed a VIE upon determination that the Company has a controlling financial interest. For entities where the Company does not have a controlling financial interest, the investments in such entities are accounted for using the equity or fair value method, as appropriate. REVENUE RECOGNITION Refer to Note 3— Revenue Recognition for full details of the Company’s revenue recognition policies. CASH AND CASH EQUIVALENTS The Company considers highly-liquid investments purchased with an original maturity of three months or less to be cash equivalents. RESTRICTED CASH The largest portion of the Company’s restricted cash relates to securitizations. The remaining portion is comprised of escrow deposits and insurance funds on deposit. Securitizations. In accordance with the contractual requirements of the Company’s various vacation ownership contract receivables (“VOCR”) securitizations, a dedicated lockbox account, subject to a blocked control agreement, is established for each securitization. At each month end, the total cash in the collection account from the previous month is analyzed and a monthly servicer report is prepared by the Company. This report details how much cash should be remitted to the note holders for principal and interest payments, and any cash remaining is transferred by the trustee to the Company. 61 Table of Contents Additionally, as required by various securitizations, the Company holds an agreed-upon percentage of the aggregate outstanding principal balances of the VOI contract receivables collateralizing the asset-backed notes in a segregated trust account as credit enhancement. Each time a securitization closes and the Company receives cash from the note holders, a portion of the cash is deposited in the trust account. As of December 31, 2025 and 2024, restricted cash for securitizations totaled $ 87 million and $ 92 million. Escrow Deposits. Laws in most U.S. states require the escrow of down payments on VOI sales, with the typical requirement mandating that the funds be held in escrow until the rescission period expires. As sales transactions are consummated, down payments are collected and are subsequently placed in escrow until the rescission period has expired. Rescission periods vary by state, but range on average from five to seven calendar days. In certain states, the escrow laws require that 100 % of VOI purchaser funds (excluding interest payments, if any) be held in escrow until the deeding process is complete. Where possible, the Company utilizes surety bonds in lieu of escrow deposits. Similarly, laws in certain U.S. states require the escrow of advance deposits received from guests for vacations paid and not yet traveled through the Company’s Travel and Membership businesses. Such amounts are required to be held in escrow until the legal restriction expires, which varies from state to state. Escrow deposits were $ 41 million and $ 37 million as of December 31, 2025 and 2024. Funds on Deposit. The Company operates a captive insurance company which provides property insurance to Travel + Leisure Co. and its affiliates. Amounts received are maintained by a third party and released from this account as necessary to pay claims. Funds on deposit were $ 45 million and $ 33 million as of December 31, 2025 and 2024. RECEIVABLE VALUATION Trade receivables The Company provides for estimated bad debts based on its assessment of the ultimate ability to realize receivables, considering historical collection experience, the economic environment, and specific customer information. When the Company determines that an account is not collectible, the account is written-off to the allowance for doubtful accounts. The following table illustrates the Company’s allowance for doubtful accounts activity from continuing operations (in millions): Year Ended December 31, 2025 2024 2023 Beginning balance $ 142 $ 143 $ 168 Bad debt expense 113 97 80 Write-offs ( 97 ) ( 98 ) ( 105 ) Ending balance $ 158 $ 142 $ 143 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. This analysis is based upon the historical performance of similar VOCRs 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 expected losses. A qualitative assessment is also performed to determine whether any external economic conditions or internal portfolio characteristics indicate an adjustment is necessary to reflect expected impacts on the contract receivables portfolio. If current or expected future conditions differ from the conditions in effect when the historical experience was generated, the Company adjusts the allowance for loan losses to reflect the expected effects of the current environment on the collectability of VOCRs. For additional details on the Company’s vacation ownership contract receivables, including information on the related allowances, see Note 9— Vacation Ownership Contract Receivables. INVENTORY Inventory primarily consists of completed VOIs, VOIs under construction, land held for future VOI development, vacation exchange credits, and real estate interests subject to financing arrangements. 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 62 Table of Contents 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. There was no capitalized interest applied to inventory during 2025, 2024, or 2023. PROPERTY AND EQUIPMENT Property and equipment (including leasehold improvements) are recorded at cost and presented net of accumulated depreciation and amortization. Depreciation, recorded as a component of Depreciation and amortization on the Consolidated Statements of Income, is computed utilizing the straight-line method over the lesser of the lease terms or estimated useful lives of the related assets. 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. 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. Capitalization of software costs developed for internal use commences during the development phase of the project. The Company amortizes software developed or obtained for internal use on a straight-line basis over its estimated useful life, which is generally two to five years , with the exception of certain enterprise resource planning, reservation, and inventory management software, which is up to 10 years. Such amortization commences when the software is substantially ready for its intended use. The net carrying value of software developed or obtained for internal use was $ 162 million and $ 156 million as of December 31, 2025 and 2024. Capitalized interest was $ 1 million, $ 1 million, and less than $ 1 million during 2025, 2024, and 2023. DERIVATIVE INSTRUMENTS The Company uses derivative instruments as part of its overall strategy to manage its exposure to market risks primarily associated with fluctuations in foreign currency exchange rates and interest rates. As a matter of policy, the Company does not use derivatives for trading or speculative purposes. 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 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. Amounts included in other comprehensive income are reclassified into earnings in the same period during which the hedged item affects earnings. INCOME TAXES The Company recognizes deferred tax assets and liabilities using the asset and liability method, under which deferred tax assets and liabilities are calculated based upon the temporary differences between the financial statement and income tax bases of assets and liabilities using currently enacted tax rates. These differences are based upon estimated differences between the book and tax basis of the assets and liabilities for the Company as of December 31, 2025 and 2024. The Company recognizes the effects of changes in tax laws, or rates, as a component of income taxes from continuing operations within the period that includes the enactment date. The Company’s deferred tax assets are recorded net of a valuation allowance when, based on the weight of available evidence, it is more likely than not that some portion or all of the recorded deferred tax assets will not be realized in future periods. Decreases to the valuation allowance are recorded as reductions to the Company’s provision for income taxes and increases to the valuation allowance result in additional provision for income taxes. The realization of the Company’s deferred tax assets, net of the valuation allowance, is primarily dependent on estimated future taxable income. A change in the Company’s estimate of future taxable income may require a change to the valuation allowance. For tax positions the Company has taken or expects to take in a tax return, the Company applies a more likely than not threshold, under which the Company must conclude that a tax position is more likely than not to be sustained, assuming that the position will be examined by the appropriate taxing authority that has full knowledge of all relevant information, in order to recognize or continue to recognize the benefit. In determining the Company’s provision for income taxes, the Company uses judgment, reflecting its estimates and assumptions, in applying the more likely than not threshold. The Company classifies interest and penalties associated with unrecognized tax benefits as a component of Provision for income taxes on the Consolidated Statements of Income. 63 Table of Contents ADVERTISING EXPENSE Advertising costs are expensed in the period incurred. Advertising costs were $ 35 million, $ 26 million, and $ 30 million in 2025, 2024, and 2023. STOCK-BASED COMPENSATION 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 Assets such as customer lists, management agreements, and trademarks acquired by the Company are classified as intangible assets and recorded at their fair value as of the date of the acquisition and categorized as having either a finite life or an indefinite life. Assets deemed to have a finite life are assigned an appropriate useful life and amortized on a straight-line basis. IMPAIRMENT OF LONG-LIVED ASSETS The Company has goodwill and other indefinite-lived intangible assets recorded in connection with business combinations. The Company annually in the fourth quarter, or more frequently if circumstances indicate that the value of goodwill may be impaired, reviews the reporting units’ carrying values. This is done either by performing a qualitative assessment or a quantitative assessment, with an impairment being recognized only if a reporting unit’s fair value is less than carrying value. In any given year, the Company can elect to perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is in excess of its carrying value. If it is not more likely than not that the fair value is in excess of the carrying value, or the Company elects to bypass the qualitative assessment, it would utilize the quantitative assessment. The qualitative factors evaluated include macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, and the Company’s historical share price as well as other industry-specific considerations. 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, 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. The Company completed its annual goodwill impairment test by performing a qualitative analysis for each of its reporting units as of October 1, 2025 and determined that no impairment exists. The Company also evaluates the recoverability of its other long-lived assets, including property and equipment and amortizable intangible assets, if circumstances indicate impairment may have occurred. 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 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. ACCOUNTING FOR RESTRUCTURING ACTIVITIES The Company’s restructuring activities require it to make significant estimates in several areas including (i) expenses for severance and related benefit costs, (ii) the ability to generate sublease income, as well as its ability to terminate lease obligations, and (iii) contract terminations. The amount that the Company accrued as of December 31, 2025, represents its best estimate of the obligations incurred in connection with these actions, but could change due to various factors including market conditions or the outcome of negotiations with third parties. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS Disclosure Improvements . In October 2023, the Financial Accounting Standards Board (“FASB”) issued guidance to modify the disclosure and presentation requirements of a variety of topics in the codification. 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 SEC’s 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 adjust its disclosures as needed in future filings. 64 Table of Contents 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. Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity. In May 2025, the FASB issued guidance to revise current guidance for determining the accounting acquirer for a transaction effected primarily by exchanging equity interests in which the legal acquiree is a VIE that meets the definition of a business. The amendments require that an entity consider the same factors that are currently required for determining which entity is the accounting acquirer in other acquisition transactions. Previously, the accounting acquirer in such transactions was always the primary beneficiary. This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this guidance on its financial statements and related disclosures. Financial Instruments—Credit Losses. In July 2025, the FASB issued new guidance amending the manner in which credit losses for accounts receivable and contract assets are determined. For public companies, the guidance introduces a practical expedient for estimating expected credit losses on current accounts receivable and current contract assets. Under this expedient, entities may assume that conditions existing at the balance sheet date will persist for the remaining life of the asset, which simplifies the estimation process by eliminating the need to forecast future economic conditions for these short-term assets. This guidance is effective for fiscal years beginning after December 15, 2025, with early adoption permitted. The Company is currently evaluating the impact of the adoption of this guidance on its financial statements and related disclosures. Software costs. In September 2025, the FASB issued new guidance amending the accounting for and disclosure of software costs. The amendments update the framework for recognizing and disclosing costs related to software developed for internal use, including costs associated with website development. The amendments are effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual periods. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently evaluating the impact of this guidance on its financial statements and related disclosures. Hedge accounting. In November 2025, the FASB issued new guidance that updates several aspects of hedge accounting under ASC 815. The amendments address how companies assess risk for cash flow hedges, account for hedges of forecasted interest payments on choose-your-rate debt, apply hedge accounting to nonfinancial forecasted transactions, use net written options as hedging instruments, and manage dual hedges involving foreign-currency-denominated debt. These changes are designed to better align hedge accounting practices with the actual risk management strategies used by companies. The guidance is effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods therein. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its financial statements and related disclosures. Interim accounting. In December 2025, the FASB issued new guidance which updates ASC 270 to make interim reporting requirements clearer and easier to follow. The guidance clarifies the required format and content of interim reports, provides comprehensive lists of interim disclosures required by other Codification topics, and establishes that entities must disclose any material events occurring after the last annual reporting period. These changes are intended to improve clarity and consistency, without fundamentally altering the nature or scope of interim reporting requirements. The guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its financial statements and related disclosures. Codification Improvements. In December 2025, the FASB issued new guidance related to its continuing agenda to make improvements to the Codification. The purpose of the new guidance is to cover “a broad range of Topics arising from technical corrections, unintended application of the Codification, clarifications, and other minor improvements.” The guidance is effective for annual reporting periods beginning after December 15, 2026, including interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its financial statements and related disclosures. 65 Table of Contents RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Business Combinations—Joint Venture Formations . In August 2023, the FASB issued guidance to address the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. The guidance was issued in an effort to reduce diversity in practice and requires a joint venture to initially measure its assets and liabilities at fair value on the formation date. This guidance became effective prospectively for all joint ventures within the scope of the standard that were formed on or after January 1, 2025. Existing joint ventures have the option to apply the guidance retrospectively. The adoption of this guidance did not have a significant impact on the Company’s financial statements and related disclosures. 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. This guidance became effective for annual periods beginning after December 15, 2024. The Company has elected to prospectively adopt the new guidance. The adoption of this guidance only affected disclosures within Note 8— Income Taxes. 3. Revenue Recognition Vacation Ownership The Company 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. The Company’s sales of VOIs are either cash sales or developer-financed sales. 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. For developer-financed sales, the Company reduces the VOI sales transaction price by an estimate of uncollectible consideration at the time of the sale. The Company’s estimates of uncollectible amounts are based largely on the results of the Company’s static pool analysis which relies on historical payment data by customer class. In connection with entering into a VOI sale, the Company may provide its customers with certain non-cash incentives, such as credits for future stays at its resorts. For those VOI sales, the Company allocates the sales price between the VOI sale and the non-cash incentive based upon the relative standalone selling price of the performance obligations within the contract. Non-cash incentives generally have expiration periods of two years or less and are recognized at a point in time upon transfer of control. The Company provides day-to-day property management services including oversight of housekeeping services, maintenance, and certain accounting and administrative services for property owners’ associations and clubs. These services may also include reservation and resort renovation activities. 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). Fees for property management services typically approximate 10 % of budgeted operating expenses. The Company is entitled to consideration for reimbursement of costs incurred on behalf of the property owners’ association in providing management services (“reimbursable revenue”). These reimbursable costs principally relate to the payroll costs for management of the associations, club and resort properties where the Company is the employer and are reflected as a component of Operating expenses on the Consolidated Statements of Income. The Company reduces its management fee revenue for amounts it has paid to the property owners’ association that reflect maintenance fees for VOIs for which it retains ownership, as the Company has concluded that such payments are consideration payable to a customer. 66 Table of Contents Property management fee revenues and reimbursable revenues are recognized when the services are performed and are recorded as a component of Service and membership fees on the Consolidated Statements of Income. Property management fee and reimbursable revenues were (in millions): Year Ended December 31, 2025 2024 2023 Management fee revenues $ 453 $ 448 $ 432 Reimbursable revenues 426 397 382 Property management fees and reimbursable revenues $ 879 $ 845 $ 814 One of the associations that the Company manages paid the Travel and Membership segment $ 35 million, $ 35 million, and $ 36 million for exchange services during 2025, 2024, and 2023. The Company earns revenue from its Wyndham Rewards co–branded credit card program, which is primarily generated by cardholder spending and the enrollment of new cardholders. The primary performance obligation for the program relates to brand performance services. Total contract consideration is estimated and recognized on a straight-line basis over the contract term. Travel and Membership Travel and Membership derives a majority of its revenues from membership dues and fees for facilitating members’ trading of their timeshare intervals. Revenues from membership dues represent the fees paid by members or affiliated clubs on their behalf. As a provider of vacation exchange services, the Company enters into affiliation agreements with developers of vacation ownership properties to allow owners of VOIs to trade their intervals for intervals at other properties affiliated with the Company’s vacation exchange network and, for some members, for other leisure-related services and products. The Company recognizes revenues from membership dues paid by the member on a straight-line basis over the membership period as the performance obligations are fulfilled through delivery of publications, if applicable, and by providing access to travel-related products and services. Estimated net contract consideration payable by affiliated clubs for memberships is recognized as revenue over the term of the contract with the affiliated club in proportion to the estimated average monthly member count. Such estimates are adjusted periodically for changes in actual and forecasted member activity. For additional fees, members have the right to exchange their intervals for intervals at other properties affiliated with the Company’s vacation exchange networks and, for certain members, for other leisure-related services and products. The Company also derives revenue from facilitating bookings of travel accommodations that were acquired from various sources. 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. Revenues from other vacation exchange-related product fees are deferred and recognized upon the occurrence of a future exchange, event, or other related transaction. The Company earns revenue from its RCI Elite Rewards co–branded credit card program, which is primarily generated by cardholder spending and the enrollment of new cardholders. The primary performance obligation for the program relates to brand performance services. Total contract consideration is estimated and recognized on a straight-line basis over the contract term. Other Items The Company records property management service revenues for its Vacation Ownership segment and RCI Elite Rewards revenues for its Travel and Membership segment gross as a principal. 67 Table of Contents Contract Liabilities Contract liabilities generally represent payments or consideration received in advance for goods or services that the Company has not yet transferred to the customer. Contract liabilities consisted of (in millions): As of December 31, 2025 2024 Deferred subscription revenue $ 147 $ 151 Deferred VOI trial package revenue 138 142 Deferred VOI incentive revenue 90 86 Deferred exchange-related revenue (a) 57 58 Deferred co-branded credit card programs revenue 36 21 Deferred other revenue 1 1 Total $ 469 $ 459 (a) Includes contractual liabilities to accommodate members for cancellations initiated by the Company due to unexpected events. As of December 31, 2025 and 2024 there were $ 1 million and $ 2 million of these contractual liabilities included within Accrued expenses and other liabilities on the Consolidated Balance Sheets. In the Company’s Vacation Ownership segment, deferred VOI trial package revenue represents consideration received in advance for a trial VOI, which allows customers to utilize a vacation package typically within three years of purchase but may extend longer for certain programs. Deferred VOI incentive revenue represents payments received in advance for additional travel-related services and products at the time of a VOI sale. Revenue is recognized when a customer utilizes the additional services and products, which is typically within two years of the VOI sale but may extend longer for certain programs. Within the Company’s Travel and Membership segment, deferred subscription revenue represents billings and payments received in advance from members and affiliated clubs for memberships in the Company’s travel programs which are recognized in future periods. Deferred exchange-related revenue primarily represents payments received in advance from members to book vacation exchanges which are recognized upon the future confirmed transaction. Deferred revenue also includes other leisure-related service and product revenues which are recognized as customers utilize the associated benefits. Deferred co-branded credit card programs revenue represents the advance payments received under these programs for the Vacation Ownership and Travel and Membership segments, which are recognized as the brand performance service obligations are satisfied. Changes in contract liabilities for the periods presented were as follows (in millions): Year Ended December 31, 2025 2024 2023 Beginning balance $ 459 $ 444 $ 400 Additions 328 322 326 Revenue recognized ( 318 ) ( 307 ) ( 282 ) Ending balance $ 469 $ 459 $ 444 Capitalized Contract Costs The Vacation Ownership segment incurs certain direct and incremental selling costs in connection with VOI trial package and incentive revenues. Such costs are capitalized and subsequently recognized over the utilization period when usage or expiration occurs, which is typically within three years from the date of sale. As of December 31, 2025 and 2024, these capitalized costs were $ 50 million and $ 49 million and are included within Other assets on the Consolidated Balance Sheets. The Travel and Membership segment incurs certain direct and incremental selling costs to obtain contracts with customers in connection with subscription revenues and exchange–related revenues. 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, 2025, the capitalized costs were $ 16 million, of which $ 9 million is included in Prepaid expenses and $ 7 million is included in Other assets on the 68 Table of Contents Consolidated Balance Sheets. As of December 31, 2024 the capitalized cost were $ 16 million, of which $ 11 million is included in Prepaid expenses and $ 5 million is included in Other assets on the Consolidated Balance Sheets. Practical Expedients The Company has not adjusted the consideration for the effects of a significant financing component if it expected, at contract inception, that the period between when the Company will satisfy the performance obligation and when the customer will pay for that good or service will be one year or less. Performance Obligations A performance obligation is a promise in a contract with a customer to transfer a distinct good or service to the customer. The consideration received from a customer is allocated to each distinct performance obligation and recognized as revenue when, or as, each performance obligation is satisfied. The following table summarizes the Company’s remaining performance obligations for the 12-month periods set forth below (in millions): 2026 2027 2028 Thereafter Total Subscription revenue $ 82 $ 32 $ 15 $ 18 $ 147 VOI trial package revenue 126 4 4 4 138 VOI incentive revenue 90 — — — 90 Exchange-related revenue 53 2 1 1 57 Co-branded credit card programs revenue 4 4 4 24 36 Other revenue 1 — — — 1 Total $ 356 $ 42 $ 24 $ 47 $ 469 Disaggregation of Net Revenues The table below presents a disaggregation of the Company’s net revenues from contracts with customers by major services and products for each of the Company’s segments (in millions): Year Ended December 31, 2025 2024 2023 Vacation Ownership Vacation ownership interest sales $ 1,847 $ 1,721 $ 1,582 Property management fees and reimbursable revenues 879 845 814 Consumer financing 454 450 427 Fee-for-Service commissions 78 71 131 Ancillary revenues 103 84 87 Total Vacation Ownership 3,361 3,171 3,041 Travel and Membership Transaction revenues 463 487 499 Subscription revenues 172 179 183 Ancillary revenues 27 29 29 Total Travel and Membership 662 695 711 Corporate and other Ancillary revenues 2 2 5 Eliminations ( 4 ) ( 4 ) ( 7 ) Total Corporate and other ( 2 ) ( 2 ) ( 2 ) Net revenues $ 4,021 $ 3,864 $ 3,750 69 Table of Contents 4. Earnings Per Share The computations of basic and diluted earnings per share (“EPS”) are based on Net income attributable to Travel + Leisure Co. shareholders divided by the basic weighted average number of common shares and diluted weighted average number of common shares outstanding. The following table sets forth the computations of basic and diluted EPS (in millions, except per share data): Year Ended December 31, 2025 2024 2023 Net income from continuing operations attributable to Travel + Leisure Co. shareholders $ 230 $ 378 $ 391 Gain on disposal of discontinued business attributable to Travel + Leisure Co. shareholders, net of income taxes — 33 5 Net income attributable to Travel + Leisure Co. shareholders $ 230 $ 411 $ 396 Basic earnings per share (a) Continuing operations $ 3.51 $ 5.39 $ 5.24 Discontinued operations — 0.48 0.07 $ 3.51 $ 5.87 $ 5.31 Diluted earnings per share (a) Continuing operations $ 3.44 $ 5.35 $ 5.21 Discontinued operations — 0.47 0.07 $ 3.44 $ 5.82 $ 5.28 Basic weighted average shares outstanding 65.6 70.1 74.5 RSUs (b) , PSUs (c) and NQs (d) 1.3 0.6 0.5 Diluted weighted average shares outstanding (e) 66.9 70.7 75.0 Dividends: Cash dividends per share (f) $ 2.24 $ 2.00 $ 1.80 Aggregate dividends paid to shareholders $ 149 $ 142 $ 136 (a) Earnings per share amounts are calculated using whole numbers. (b) Excludes less than 0.1 million, 0.6 million and 1.1 million of restricted stock units (“RSUs”) that would have been anti-dilutive to EPS for the years 2025, 2024 and 2023. These shares could potentially dilute EPS in the future. (c) Excludes performance-vested restricted stock units (“PSUs”) of 0.2 million, 0.7 million, and 0.7 million for the years 2025, 2024, and 2023, as the Company had not met the required performance metrics. These PSUs could potentially dilute EPS in the future. (d) Excludes 0.1 million, 0.7 million, and 2.3 million of outstanding non-qualified stock options (“NQs”) that would have been anti-dilutive to EPS for the years 2025, 2024, and 2023. These outstanding NQs could potentially dilute EPS in the future. (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 $ 0.56 per share for all four quarters of 2025, $ 0.50 per share for all four quarters of 2024, and $ 0.45 per share for all four quarters of 2023. Share Repurchase 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, 2025, 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 $ 111 million since the inception of this program. As of December 31, 2025, the Company had $ 165 million of remaining availability in its program. Subsequent to the end of the year, the Company’s Board of Directors increased the authorization for the Company’s share repurchase program by $ 750 million. 70 Table of Contents The following table summarizes stock repurchase activity under the current share repurchase program (in millions): Shares Cost As of December 31, 2024 133.0 $ 6,646 Repurchases 5.4 300 As of December 31, 2025 138.4 $ 6,946 During both 2025 and 2024, the Company incurred $ 2 million of excise tax related to share repurchases, included within Treasury stock on the Consolidated Balance Sheets. 5. Acquisitions 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. The results of operations of businesses acquired by the Company have been included in the Consolidated Statements of Income since their respective dates of acquisition. For contract assets and contract liabilities with customers acquired in business combinations which occurred in 2022 or later, the Company recognized and measured those contracts as though it had entered into the agreement with the customer as of the same date as the acquiree. The excess of the purchase price over the estimated fair values of the underlying assets acquired and liabilities assumed was allocated to goodwill. In certain circumstances, the allocations of the excess purchase price were based upon preliminary estimates and assumptions. Accordingly, the allocations may be subject to revision when the Company receives final information, including appraisals and other analyses. Any revisions to the fair values during the measurement period will be recorded by the Company as further adjustments to the purchase price allocations. Although, in certain circumstances, the Company has substantially integrated the operations of its acquired businesses, additional future costs relating to such integration may occur. These costs may result from integrating operating systems, relocating employees, closing facilities, reducing duplicative efforts, and exiting and consolidating other activities. These costs will be recorded on the Consolidated Statements of Income as expenses. Other. On February 10, 2025, the Company completed a business acquisition for consideration of $ 3 million. The fair value of purchase consideration was comprised of $ 1 million of cash paid at closing and $ 2 million to be paid in 2027. The acquisition resulted in the recognition of (i) $ 2 million of definite-lived intangible assets consisting of management agreements with a weighted average life of 22 years, and (ii) $ 1 million of Property and equipment, net. This business is included within the Vacation Ownership segment. 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 2024. This acquisition of 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, for which 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 the purchase accounting for this transaction in 2024. Playbook365. 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 71 Table of Contents 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; (ii) $ 5 million of Goodwill; (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. 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 2023. During 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 People Inc. (formerly Dotdash Meredith and 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. This transaction was accounted for as an asset acquisition, with the full consideration allocated to the related trademark indefinite-lived intangible asset. The Company acquired the Travel + Leisure brand to accelerate its strategic plan to broaden its reach with the launch of new travel services, expand its membership travel business, and amplify the global visibility of its leisure travel products. 6. Discontinued Operations 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 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. The Company does not expect to incur significant ongoing gains and/or losses for the aforementioned discontinued operation. See Note 26— Transactions with Former Parent and Former Subsidiaries for additional information. 7. Intangible Assets Intangible assets consisted of (in millions): As of December 31, 2025 As of December 31, 2024 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Unamortized Intangible Assets: Goodwill $ 972 $ 966 Trademarks (a) $ 143 $ 144 Amortized Intangible Assets: Customer lists (b) $ 77 $ 55 $ 22 $ 77 $ 48 $ 29 Management agreements (c) 72 44 28 69 41 28 Trademarks (d) 8 7 1 8 7 1 Other (e) 9 2 7 9 2 7 $ 166 $ 108 $ 58 $ 163 $ 98 $ 65 (a) Comprised of trademarks and tradenames the Company has acquired that are expected to generate future cash flows for an indefinite period of time. During 2025, the Company recorded a $ 1 million tradename impairment at the Travel and Membership segment. (b) Amortized between 4 to 15 years with a weighted average life of 13 years. (c) Amortized between 5 to 25 years with a weighted average life of 19 years . 72 Table of Contents (d) Amortized between 5 to 8 years with a weighted average life of 7 years. During 2024, the Company recorded impairments of $ 1 million to trademarks at the Travel and Membership segment. (e) Includes business contracts and noncompetition covenants, which are amortized between 10 to 69 years with a weighted average life of 58 years. Goodwill During the fourth quarters of 2025, 2024, and 2023, the Company performed its annual goodwill impairment test and determined no impairment existed as the fair value of goodwill at its reporting units was in excess of the carrying value. The changes in the carrying amount of goodwill are as follows (in millions): Balance as of December 31, 2024 Goodwill Acquired During 2025 Foreign Exchange Balance as of December 31, 2025 Travel and Membership $ 933 $ — $ 6 $ 939 Vacation Ownership 33 — — 33 Total Company $ 966 $ — $ 6 $ 972 Amortizable Intangible Assets Amortization expense relating to amortizable intangible assets is included as a component of Depreciation and amortization on the Consolidated Statements of Income and was as follows (in millions): Year Ended December 31, 2025 2024 2023 Customer lists $ 7 $ 6 $ 6 Management agreements 3 2 4 Other — 2 — Total $ 10 $ 10 $ 10 Based on the Company’s amortizable intangible assets as of December 31, 2025, the Company expects related amortization expense for the next five years as follows (in millions): Amount 2026 $ 10 2027 $ 8 2028 $ 4 2029 $ 4 2030 $ 4 8. Income Taxes The income tax provision attributable to continuing operations consisted of the following (in millions): Year Ended December 31, 2025 2024 2023 Current Federal $ 61 $ 55 $ 53 State 12 13 7 Foreign 55 41 26 128 109 86 Deferred Federal ( 14 ) 31 — State ( 5 ) ( 3 ) 6 Foreign ( 2 ) ( 2 ) 2 ( 21 ) 26 8 Provision for income taxes $ 107 $ 135 $ 94 73 Table of Contents Pre-tax income for domestic and foreign operations attributable to continuing operations consisted of the following (in millions): Year Ended December 31, 2025 2024 2023 Domestic $ 142 $ 331 $ 315 Foreign 195 182 170 Income before income taxes $ 337 $ 513 $ 485 Deferred income tax assets and liabilities were comprised of the following (in millions): As of December 31, 2025 2024 Deferred income tax assets: Provision for doubtful accounts and loan loss allowance for vacation ownership contract receivables $ 205 $ 189 Other comprehensive income 16 84 Accrued liabilities and deferred income 93 74 Inventory write-downs and impairments 55 — Foreign tax credit carryforward 27 41 Net operating loss carryforward 22 22 Tax basis differences in assets of foreign subsidiaries 12 12 Other 89 91 Valuation allowance (a) ( 107 ) ( 109 ) Deferred income tax assets 412 404 Deferred income tax liabilities: Installment sales of vacation ownership interests 793 762 Depreciation and amortization 213 194 Other comprehensive income — 66 Estimated VOI recoveries 54 52 Other 29 29 Deferred income tax liabilities 1,089 1,103 Net deferred income tax liabilities $ 677 $ 699 Reported in: Other assets $ 27 $ 23 Deferred income taxes 704 722 Net deferred income tax liabilities $ 677 $ 699 (a) The valuation allowance of $ 107 million at December 31, 2025, relates to foreign tax credits, net operating loss carryforwards, and certain deferred tax assets of $ 22 million, $ 10 million, and $ 75 million. The valuation allowance of $ 109 million at December 31, 2024, relates to foreign tax credits, net operating loss carryforwards, and certain deferred tax assets of $ 25 million, $ 9 million, and $ 75 million. The valuation allowance will be reduced when and if the Company determines it is more likely than not that the related deferred income tax assets will be realized. As of December 31, 2025, the Company’s net operating loss carryforwards primarily relate to state and foreign net operating losses of $ 10 million and $ 9 million. The state net operating losses are due to expire at various dates, but no later than 2045 for those that cannot be carried forward indefinitely. The majority of the foreign net operating losses can be carried forward indefinitely. As of December 31, 2025, the Company had $ 27 million of foreign tax credits. These foreign tax credits expire between the 2027 and 2035 tax years. 74 Table of Contents The following table is a reconciliation of the U.S. federal statutory rate to the Company’s effective rate for the year ended December 31, 2025 in accordance with the recently adopted guidance discussed in Note 2 — Summary of Significant Accounting Policies : Amount (in millions) % Federal statutory rate $ 71 21.0 % State and local income taxes, net of federal tax benefits (a) 8 2.3 % Foreign tax effects: Australia: Statutory tax rate difference 6 1.7 % Puerto Rico: Statutory tax rate difference ( 4 ) ( 1.2 ) % Other 1 0.4 % Other foreign jurisdictions 9 2.7 % Effect of cross-border tax laws: Branch income 13 3.9 % Other 4 1.3 % Tax credits: Foreign tax credits ( 12 ) ( 3.5 ) % Other ( 3 ) ( 1.0 ) % Changes in valuation allowances 5 1.5 % Nontaxable or nondeductible items 7 2.1 % Changes in unrecognized tax benefits 6 1.8 % Installment sale interest ( 5 ) ( 1.4 ) % Other adjustments 1 0.2 % Effective tax rate $ 107 31.8 % (a) State taxes in Florida and California made up the majority (greater than 50 percent) of the tax effect in this category. The Company’s effective income tax rate during 2024 and 2023 differs from the U.S. federal statutory rate as follows: Year Ended December 31, 2024 2023 Federal statutory rate 21.0 % 21.0 % State and local income taxes, net of federal tax benefits 2.6 2.6 Taxes on foreign operations at rates different than U.S. federal statutory rates ( 0.5 ) ( 2.0 ) Taxes on foreign income, net of tax credits 2.5 2.5 Valuation allowance ( 1.2 ) ( 5.4 ) Installment sale interest 0.9 0.8 Other 1.1 ( 0.1 ) 26.4 % 19.4 % 75 Table of Contents The following table summarizes the activity related to the Company’s unrecognized tax benefits (in millions): Year Ended December 31, 2025 2024 2023 Beginning balance $ 22 $ 22 $ 25 Increases related to tax positions taken during a prior period 10 — — Increases related to tax positions taken during the current period 2 2 1 Decreases related to settlements with taxing authorities ( 1 ) — — Decreases related to tax positions taken during a prior period — — ( 1 ) Decreases as a result of a lapse of the applicable statute of limitations ( 3 ) ( 2 ) ( 3 ) Ending balance $ 30 $ 22 $ 22 The gross amount of the unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate were $ 24 million, $ 17 million, and $ 18 million as of December 31, 2025, 2024, and 2023. 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 2025 penalties and interest decreased by $ 1 million. During both 2024 and 2023, penalties and interest decreased by less than $ 1 million. The Company had a liability for potential penalties of $ 3 million as of December 31, 2025, 2024 and 2023, and potential interest of $ 9 million, $ 9 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. The Company files U.S. federal and state, and foreign income tax returns in jurisdictions with varying statutes of limitations. With few exceptions, the Company is no longer subject to U.S. federal income tax examinations for years prior to 2022 and state and local income tax examinations prior to 2016. In significant foreign jurisdictions, generally years prior to 2017 are no longer subject to income tax examinations by their respective tax authorities. The Company asserts that substantially all undistributed foreign earnings will be reinvested indefinitely as of December 31, 2025. In the event the Company determines not to continue to assert that all or part of its undistributed foreign earnings are permanently reinvested, such a determina tion in the future could result in the accrual and payment of additional foreign withholding taxes, as well as U.S. taxes on currency transaction gains and losses, the determination of which is not practicable. The Company made cash income tax payments, net of refunds, of $ 87 million, $ 100 million, and $ 144 million during 2025, 2024, and 2023. Such payments exclude income tax related payments made to or refunded by the Company’s former parent Avis Budget Group, Inc. (“ABG”), formerly Cendant Corporation and Wyndham Hotels & Resorts, Inc. (“Wyndham Hotels”). During 2025, the Company’s cash income tax payments consisted of (in millions): Year Ended December 31, 2025 Federal $ 27 State 15 Foreign: Australia 22 USVI 6 Other 17 Total $ 87 76 Table of Contents 9. Vacation Ownership Contract Receivables The Company generates VOCRs by extending financing to the purchasers of its VOIs. Vacation ownership contract receivables, net consisted of the following (in millions): As of December 31, 2025 2024 Vacation ownership contract receivables: Securitized (a) $ 2,281 $ 2,293 Non-securitized (b) 1,020 940 Vacation ownership contract receivables, gross 3,301 3,233 Less: allowance for loan losses 663 614 Vacation ownership contract receivables, net $ 2,638 $ 2,619 (a) Excludes $ 19 million of accrued interest on VOCRs as of both December 31, 2025 and 2024, 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, 2025 and 2024, 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, 2025, and thereafter are as follows (in millions): Securitized Non - Securitized Total 2026 $ 221 $ 127 $ 348 2027 232 97 329 2028 242 100 342 2029 254 98 352 2030 265 92 357 Thereafter 1,067 506 1,573 $ 2,281 $ 1,020 $ 3,301 During 2025, 2024, and 2023, the Company’s securitized VOCRs generated interest income of $ 332 million, $ 329 million, and $ 311 million. Such interest income is included within Consumer financing revenue on the Consolidated Statements of Income. During 2025, 2024, and 2023, the Company had net VOCR originations of $ 1.6 billion, $ 1.53 billion, and $ 1.43 billion and received principal collections of $ 1.09 billion, $ 983 million, and $ 924 million. The weighted average interest rate on outstanding VOCRs was 14.6 %, 14.7 %, and 14.7 % during 2025, 2024, and 2023. The Company records the difference between VOCRs and the variable consideration included in the transaction price for the sale of the related VOIs as a provision for loan losses on VOCRs. The activity in the allowance for loan losses on VOCRs was as follows (in millions): Year Ended December 31, 2025 2024 2023 Allowance for loan losses beginning balance $ 614 $ 574 $ 541 Provision for loan losses, net (a) 484 432 348 Contract receivables write-offs, net ( 435 ) ( 392 ) ( 315 ) Allowance for loan losses ending balance $ 663 $ 614 $ 574 (a) Recorded as a reduction to Net revenue. Credit Quality for Financed Receivables and the Allowance for Credit Losses The basis of the differentiation within the identified class of financed VOI contract receivables is the consumer’s Fair Isaac Corporation (“FICO”) score. A FICO score is a branded version of a consumer credit score widely used within the U.S. by the largest banks and lending institutions. FICO scores range from 300 to 850 and are calculated based on information obtained from one or more of the three major U.S. credit reporting agencies that compile and report on a consumer’s credit 77 Table of Contents history. The Company updates its records for all active VOI contract receivables with a balance due on a rolling monthly basis to ensure that all VOI contract receivables are scored at least every six months. The Company groups all VOI contract receivables into five different categories: 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 Travel + Leisure Vacation Clubs Asia Pacific business for which scores are not available). The following tables detail 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, 2025 700+ 600-699 <600 No Score Asia Pacific Total Current $ 2,014 $ 680 $ 133 $ 77 $ 213 $ 3,117 31 - 60 days 31 29 13 2 4 79 61 - 90 days 22 18 11 2 3 56 91 - 120 days 15 17 12 2 3 49 Total $ 2,082 $ 744 $ 169 $ 83 $ 223 $ 3,301 As of December 31, 2024 700+ 600-699 <600 No Score Asia Pacific Total Current $ 1,935 $ 711 $ 136 $ 87 $ 193 $ 3,062 31 - 60 days 23 26 13 3 7 72 61 - 90 days 15 18 10 1 5 49 91 - 120 days 15 16 12 1 6 50 Total $ 1,988 $ 771 $ 171 $ 92 $ 211 $ 3,233 The Company ceases to accrue interest on VOI contract receivables once the contract has remained delinquent for greater than 90 days and reverses all of the associated accrued interest recognized to date against interest income included within Consumer financing revenue on the Consolidated Statements of Income. At greater than 120 days, the VOI contract receivable is written off to the allowance for loan losses. In accordance with its policy, the Company assesses the allowance for loan losses using a static pool methodology and thus does not assess individual loans for impairment. The following tables detail the year of origination of financing receivables using the most recently updated FICO scores, based on the policy described above (in millions): As of December 31, 2025 700+ 600-699 <600 No Score Asia Pacific Total 2025 $ 1,001 $ 266 $ 24 $ 30 $ 131 $ 1,452 2024 431 169 45 18 45 708 2023 251 116 36 12 18 433 2022 163 81 26 6 7 283 2021 73 36 13 2 5 129 Prior 163 76 25 15 17 296 Total $ 2,082 $ 744 $ 169 $ 83 $ 223 $ 3,301 As of December 31, 2024 700+ 600-699 <600 No Score Asia Pacific Total 2024 $ 918 $ 279 $ 29 $ 38 $ 123 $ 1,387 2023 425 187 49 16 40 717 2022 255 120 36 9 11 431 2021 111 55 20 3 7 196 2020 56 25 7 3 7 98 Prior 223 105 30 23 23 404 Total $ 1,988 $ 771 $ 171 $ 92 $ 211 $ 3,233 78 Table of Contents The table below represents the gross write-offs of financing receivables by year of origination (in millions): Year Ended December 31, 2025 2025 $ 47 2024 207 2023 100 2022 47 2021 18 Prior 20 Total $ 439 10. Inventory Inventory consisted of the following (in millions): As of December 31, 2025 2024 Completed VOI inventory $ 857 $ 970 Estimated VOI recoveries 222 214 Inventory subject to financing arrangement 26 — Land held for VOI development 10 29 VOI construction in process 9 10 Vacation exchange credits and other 4 4 Total inventory $ 1,128 $ 1,227 As VOI inventory is completed it may be transferred into property and equipment until such units are registered and made available for sale. Once registered and available for sale, the units are then transferred back into completed inventory. The Company had net transfers of VOI inventory from property and equipment of $ 66 million during 2025 and had net transfers of VOI inventory from property and equipment of $ 56 million during 2024. In connection with the resort optimization initiative discussed in Note 25— Restructuring, the Vacation Ownership segment transferred $ 16 million of inventory to assets held-for-sale during 2025 . During 2025, the Company entered into an agreement to sell real property located in Tuscaloosa, Alabama, associated with Sports Illustrated Resorts, to a third-party developer consisting of $ 26 million of vacation ownership inventory, in exchange for $ 25 million in cash consideration. Under the agreement, the Company could be obligated to repurchase the property should future events not occur. As a result, the property remained on the balance sheet and the proceeds were recorded as an inventory financing obligation, included within Accrued and other liabilities on the Consolidated Balance Sheets. The Company recognized no gain or loss on this transaction. Inventory Obligations The Company has entered into inventory sale transactions with third-party developers for which the Company has conditional rights and obligations to repurchase the completed properties from the developers subject to the properties conforming to the Company’s vacation ownership resort standards and provided that the third-party developers have not sold the properties to another party. Under the sale of real estate accounting guidance, the conditional rights and obligations of the Company constitute continuing involvement and thus the Company was unable to account for these transactions as a sale. 79 Table of Contents The following table summarizes the activity related to the Company’s inventory obligations (in millions): Other (a) Total December 31, 2023 $ 8 $ 8 Purchases 106 106 Payments ( 107 ) ( 107 ) December 31, 2024 7 7 Purchases 125 125 Payments ( 130 ) ( 130 ) December 31, 2025 $ 2 $ 2 (a) Included in Accounts payable on the Consolidated Balance Sheets. The Company has committed to purchase completed properties from third-party developers subject to the properties meeting the Company’s vacation ownership resort standards and provided that the third-party developers have not sold the properties to another party. The third-party developers are VIEs for which the Company is not the primary beneficiary. Accordingly, the Company does not consolidate the VIEs. The maximum potential future payments that the Company could be required to make under these commitments was $ 246 million as of December 31, 2025. 11. Property and Equipment Property and equipment, net consisted of the following (in millions): As of December 31, 2025 2024 Capitalized software $ 854 $ 794 Building and leasehold improvements (a) 564 625 Furniture, fixtures and equipment 120 144 Finance leases 59 50 Land 20 28 Construction in progress 9 21 Total property and equipment 1,626 1,662 Less: accumulated depreciation and amortization 1,095 1,071 Property and equipment, net $ 531 $ 591 (a) Includes $ 119 million and $ 192 million of unregistered VOI inventory as of December 31, 2025 and 2024. During 2025, 2024, and 2023, the Company recorded depreciation and amortization expense of $ 114 million, $ 105 million, and $ 102 million related to property and equipment. As of December 31, 2025 and 2024, the Company had accrued capital expenditures of $ 7 million and $ 5 million. 12. Leases 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. For leases with terms greater than 12 months, the Company records the related asset and obligation at the present value of lease payments over the term. Many of its leases include rental escalation clauses, lease incentives, renewal options and/or termination options that are factored into the Company’s determination of lease payments. The Company elected the hindsight practical expedient to determine the reasonably certain lease term for existing leases. The Company also made an accounting policy election to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments on a straight-line basis over the lease term in the Consolidated Statements of Income. When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of its leases do not provide a readily determinable implicit rate. Therefore, the Company must estimate its incremental borrowing rate to discount the lease payments based on information available at lease commencement. The majority of the Company’s leases have remaining lease terms of one to 20 years, some of which include options to extend the leases for up to 10 years, and some of which include options to terminate the leases within one year . 80 Table of Contents The table below presents information related to the lease costs for finance and operating leases (in millions): Year Ended December 31, 2025 2024 2023 Operating lease cost $ 19 $ 20 $ 21 Short-term lease cost $ 15 $ 14 $ 13 Finance lease cost: Amortization of right-of-use assets $ 12 $ 11 $ 8 Interest on lease liabilities 1 1 1 Total finance lease cost $ 13 $ 12 $ 9 The table below presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheets: As of December 31, Balance Sheet Classification 2025 2024 Operating leases (in millions): Operating lease right-of-use assets Other assets $ 85 $ 47 Operating lease liabilities Accrued expenses and other liabilities $ 136 $ 79 Finance leases (in millions): Finance lease assets (a) Property and equipment, net $ 19 $ 21 Finance lease liabilities Debt $ 18 $ 21 Weighted average remaining lease term: Operating leases 9.6 years 4.9 years Finance leases 2.4 years 2.6 years Weighted average discount rate: Operating leases (b) 6.3 % 6.2 % Finance leases 6.1 % 6.5 % (a) Presented net of accumulated depreciation. (b) Upon adoption of the lease standard, discount rates used for existing leases were established at January 1, 2019. The table below presents supplemental cash flow information related to leases (in millions): Year Ended December 31, 2025 2024 2023 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 28 $ 31 $ 32 Operating cash outflows from finance leases $ 1 $ 1 $ 1 Financing cash outflows from finance leases $ 12 $ 10 $ 9 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 79 $ 19 $ 3 Finance leases $ 10 $ 11 $ 16 81 Table of Contents The table below presents maturities of lease liabilities as of December 31, 2025 (in millions): Operating Leases Finance Leases 2026 $ 26 $ 9 2027 24 6 2028 21 3 2029 20 1 2030 13 — Thereafter 84 — Total minimum lease payments 188 19 Amount of lease payments representing interest ( 52 ) ( 1 ) Present value of future minimum lease payments $ 136 $ 18 The Company has entered into a lease agreement for the relocation of its corporate headquarters which commenced on September 1, 2025. The lease term is for 15 years with two 5 -year renewal options . The estimated average annual lease payments under this agreement are $ 7 million. 13. Other Assets Other assets consisted of the following (in millions): As of December 31, 2025 2024 Non-trade receivables, net $ 106 $ 84 Right-of-use assets 85 47 Deferred costs 64 54 Capitalized contract costs (a) 57 54 Payroll funding 35 37 Held-for-sale 28 19 Deferred income tax asset 27 23 Deposits 22 17 Investments 18 18 Tax receivables 13 42 Marketable securities 13 17 Other 17 13 Total $ 485 $ 425 (a) Includes certain direct and incremental selling costs in connection with VOI trial package, incentive, subscription, and exchange–related revenues. See Note 3— Revenue Recognition for additional details. 82 Table of Contents 14. Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consisted of the following (in millions): As of December 31, 2025 2024 Accrued payroll and related costs $ 248 $ 231 Lease liabilities (a) 136 79 Resort related obligation and commitments 83 66 Accrued taxes 74 60 Accrued interest 56 49 Funds on deposit 42 31 Accrued advertising and marketing 40 38 Restructuring liabilities (b) 28 23 Payables associated with separation and sale of business activities 27 50 Inventory financing obligation (c) 25 — Accrued legal and professional fees 24 27 Guarantees 24 24 Accrued other 103 100 Total $ 910 $ 778 (a) See Note 12— Leases for details. (b) See Note 25— Restructuring for details. (c) See Note 10—Inventory for details . 15. Debt The Company’s indebtedness consisted of the following (in millions): As of December 31, 2025 2024 Non-recourse vacation ownership debt : (a) Term notes (b) $ 1,690 $ 1,746 USD bank conduit facility (due August 2027) (c) 318 278 AUD/NZD bank conduit facility (due December 2026) (d) 116 99 Total $ 2,124 $ 2,123 Debt : (e) $ 1.0 billion secured revolving credit facility (due June 2030) (f) $ 63 $ 196 Secured term loan B (due December 2029) (g) 854 860 $ 350 million 6.60 % secured notes (due October 2025) (h) — 349 $ 650 million 6.625 % secured notes (due July 2026) 649 648 $ 400 million 6.00 % secured notes (due April 2027) 402 403 $ 650 million 4.50 % secured notes (due December 2029) (i) 646 644 $ 350 million 4.625 % secured notes (due March 2030) 348 347 $ 500 million 6.125 % secured notes (due September 2033) 494 — Finance leases 18 21 Total $ 3,474 $ 3,468 (a) Represents non-recourse debt that is securitized through bankruptcy-remote special purpose entities, the creditors of which have no recourse to the Company for principal and interest. These outstanding borrowings (which legally are not liabilities of the Company) are collateralized by $ 2.40 billion and $ 2.41 billion of underlying gross VOCRs and related assets (which legally are not assets of the Company) as of December 31, 2025 and 2024. (b) The carrying amounts of the term notes are net of deferred financing costs of $ 23 million as of both December 31, 2025 and 2024. 83 Table of Contents (c) The Company has a borrowing capacity of $ 600 million under the USD bank conduit facility through August 2027. Borrowings under this facility are required to be repaid as the collateralized receivables amortize but no later than September 2028. (d) The Company has a borrowing capacity of 200 million Australian dollars (“AUD”) and 25 million New Zealand dollars (“NZD”) under the AUD/NZD bank conduit facility through December 2026. 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 $ 11 million and $ 15 million as of December 31, 2025 and 2024, and net of unamortized debt financing costs of $ 16 million and $ 12 million as of December 31, 2025 and 2024. (f) The weighted average effective interest rate on facility borrowings was 6.52 % and 7.52 % as of December 31, 2025 and 2024. (g) The weighted average effective interest rate on facility borrowings was 6.86 % and 7.04 % as of December 31, 2025 and 2024 . (h) Includes $ 1 million of unamortized losses from the settlement of a derivative as of December 31, 2024. (i) Includes $ 2 million and $ 4 million of unamortized gains from the settlement of a derivative as of December 31, 2025 and 2024. Maturities and Capacity The Company’s outstanding indebtedness as of December 31, 2025, matures as follows (in millions): Non-recourse Vacation Ownership Debt (a) Debt Total Within 1 year $ 244 $ 666 $ 910 Between 1 and 2 years 241 416 657 Between 2 and 3 years 450 12 462 Between 3 and 4 years 197 1,474 1,671 Between 4 and 5 years 205 411 616 Thereafter 787 495 1,282 $ 2,124 $ 3,474 $ 5,598 (a) Required principal payments on the non-recourse vacation ownership debt are based on the contractual repayment terms of the underlying VOCRs. Actual maturities may differ as a result of prepayments by the VOCR obligors. As of December 31, 2025, the available capacities under the Company’s borrowing arrangements were as follows (in millions): Non-recourse Conduit Facilities (a) Revolving Credit Facilities (b) Total capacity $ 748 $ 1,000 Less: outstanding borrowings 434 63 Less: letters of credit — 44 Available capacity $ 314 $ 893 (a) Consists of the Company’s USD bank conduit facility and AUD/NZD bank conduit facility. 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. Non-recourse Vacation Ownership Debt As discussed in Note 16— Variable Interest Entities , the Company issues debt through the securitization of VOCRs. Sierra Timeshare 2025-1 Receivables Funding LLC. On March 19, 2025, the Company closed on a placement of a series of term notes payable, issued by Sierra Timeshare 2025-1 Receivables Funding LLC, with an initial principal amount of $ 350 million, secured by VOCRs and bearing interest at a weighted average coupon rate of 5.20 %. The advance rate for this transaction was 98 %. As of December 31, 2025 the Company had $ 208 million of outstanding borrowings under these term notes, net of debt issuance costs. Sierra Timeshare 2025-2 Receivables Funding LLC. On July 22, 2025, the Company closed on a placement of a series of term notes payable, issued by Sierra Timeshare 2025-2 Receivables Funding LLC, with an initial principal amount of $ 300 million, secured by VOCRs and bearing interest at a weighted average coupon rate of 5.10 %. The advance rate for this transaction was 98 %. As of December 31, 2025, the Company had $ 224 million of outstanding borrowings under these term notes, net of debt issuance costs. Sierra Timeshare 2025-3 Receivables Funding LLC. On October 15, 2025, the Company closed on a placement of a series of term notes payable, issued by Sierra Timeshare 2025-3 Receivables Funding LLC, with an initial principal amount of 84 Table of Contents $ 300 million, secured by VOCRs and bearing interest at a weighted average coupon rate of 4.78 %. The advance rate for this transaction was 98 %. As of December 31, 2025, the Company had $ 265 million of outstanding borrowings under these term notes, net of debt issuance costs. Term Notes. In addition to the 2025 term notes described above, as of December 31, 2025, the Company had $ 993 million of outstanding non-recourse borrowings, net of debt issuance costs, under term notes entered into prior to December 31, 2024. The Company’s non-recourse term notes include fixed rate term notes for which the weighted average interest rate was 6.5 %, 6.5 %, and 5.6 % during 2025, 2024, and 2023. USD bank conduit facility. On April 17, 2025, the Company renewed its $ 600 million USD timeshare receivables conduit facility, extending the end of the commitment period from September 2025 to August 2027 and making certain other amendments, including to the advance rate. The facility bears interest based on a mix between the variable commercial paper rates plus a spread and the Daily Simple Secured Overnight Financing Rate (“SOFR”), plus a spread, 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 and is secured by VOCRs, bearing interest at variable rates based on the Bank Bill Swap Bid Rate plus 1.55 %. Borrowings under this facility are required to be repaid no later than January 2029. As of December 31, 2025, the Company had $ 116 million of outstanding borrowings under this facility. As of December 31, 2025, the Company’s non-recourse vacation ownership debt of $ 2.12 billion was collateralized by $ 2.40 billion of underlying gross VOCRs and related assets. Additional usage of the Company’s non-recourse bank conduit facilities is subject to the Company’s ability to provide additional assets to collateralize such facilities. The combined weighted average interest rate on the Company’s total non-recourse vacation ownership debt was 6.6 %, 6.8 %, and 5.9 % during 2025, 2024, and 2023. Debt $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 consisting of a Term Loan B facility and a $ 1.0 billion secured revolving facility. On June 25, 2025, the Company entered into the seventh amendment to the agreement governing its $ 1.0 billion revolving credit and term loan B facility (“Seventh Amendment”). The Seventh Amendment refinanced and extended the maturity of the revolving credit facility from October 2026 to June 2030, and among other things: • Provides that borrowings under the revolving credit facility bear interest at a per annum rate equal to Term SOFR (or in the case of revolving borrowings in other currencies, the applicable interest benchmark for such currency) plus a spread ranging from 1.50 % to 2.00 %, depending on the Company’s first lien leverage ratio (and with a customary ability to borrow loans bearing interest at a “base rate,” other than Term SOFR, plus a spread from 0.50 % to 1.00 %), representing an overall reduction in the spread of 25 basis points at all pricing levels. • Eliminated the “credit spread adjustment” applicable to revolving credit loans, representing a reduction of 11.45 to 71.51 basis points depending on tenor, and reduced the Term SOFR floor applicable to revolving credit loans from 0.50 % to 0.00 %. • Reduced the commitment fee for the unused portion of the revolving credit facility. This fee is based on the first-lien leverage ratio and ranges from 0.20 % to 0.25 % (previously 0.25 % to 0.35 %) per annum of the unused balance. • Reduced the minimum interest coverage ratio to 2.00 to 1.00 (previously 2.50 to 1.00). On December 10, 2025, the Company entered into the eighth amendment to the agreement governing its $ 1.0 billion revolving credit and term loan B facility (“Eighth Amendment”). The Eighth Amendment refinanced the $ 869 million outstanding balance of the Term Loan B facility, with interest rate per annum applicable to borrowings under this facility equal to the Term SOFR rate, plus an applicable rate of 2.00 % (previously 2.50 %). The maturity date of this facility remains December 14, 2029 and the principal amortizes in equal quarterly installments of 0.25 % of the principal amount at the time of the amendment. As of December 31, 2025, the security agreement that exists in connection with the credit agreement names Bank of America N.A. 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.” 85 Table of Contents 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 On August 19, 2025, the Company closed on a private offering of secured notes, with a face value of $ 500 million and an interest rate of 6.125 %. Deferred financing costs for this transaction were $ 6 million, which will be amortized over the life of the notes. Interest is payable semi-annually in arrears. The notes will mature on September 1, 2033, unless earlier redeemed in accordance with their terms. Prior to August 15, 2028, the Company will be entitled at its option to redeem all or a portion of these notes at a redemption price equal to 100% of the principal amount of the notes to be redeemed plus a “make-whole premium” plus any accrued and unpaid interest. At any time on or after August 15, 2028, the Company may redeem all or a portion of the notes at certain redemption prices above their face amount plus any accrued and unpaid interest. On or after August 15, 2030 the Company will be able to redeem the notes at par plus any accrued and unpaid interest. The proceeds of this offering were used to redeem all of the Company’s $ 350 million 6.6 % secured notes due October 2025, toward repayment of outstanding borrowings under the revolving credit facility, to pay the fees and expenses incurred in connection with the issuance, and for general corporate purposes. Pursuant to the terms of the indenture governing the Company’s rating sensitive $ 400 million 6.0 % notes due 2027, the interest rate on such 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., or a substitute rating agency. Since issuance, the interest rates on the related notes have increased 150 basis points as of December 31, 2025, with a maximum potential for additional increase of 50 basis points. As of December 31, 2025, the Company had $ 2.05 billion of outstanding secured notes issued prior to December 31, 2024. Interest on these notes is payable semi-annually in arrears. The notes are redeemable at the Company’s option at a redemption price equal to the greater of (i) the sum of the principal being redeemed, and (ii) a “make-whole” price specified in the indenture of the notes, plus, in each case, accrued and unpaid interest. These notes rank equally in right of payment with all of the Company’s other secured indebtedness. Deferred Financing Costs The Company classifies debt issuance costs related to its revolving credit facilities and the bank conduit facilities within Other assets on the Consolidated Balance Sheets. Such costs were $ 8 million and $ 5 million as of December 31, 2025 and 2024. Debt Covenants The revolving credit facility and term loan B facility are subject to covenants including the maintenance of specific financial ratios as defined in the credit agreement. The financial ratio covenants consist of a minimum interest coverage ratio of 2.00 to 1.0 as of the measurement date and a maximum first lien leverage ratio of 4.25 to 1.0 as of the measurement date. The interest coverage ratio is calculated by dividing consolidated EBITDA (as defined in the credit agreement) by consolidated interest expense (as defined in the credit agreement), both as measured on a trailing 12-month basis preceding the measurement date. The first lien leverage ratio is calculated by dividing consolidated first lien debt (as defined in the credit agreement) as of the measurement date by consolidated EBITDA (as defined in the credit agreement) as measured on a trailing 12-month basis preceding the measurement date. As of December 31, 2025, the Company’s interest coverage ratio was 4.92 to 1.0 and the first lien leverage ratio was 3.06 to 1.0. These ratios do not include interest expense or indebtedness related to any qualified securitization financing (as defined in the credit agreement). As of December 31, 2025, the Company was in compliance with the financial covenants described above. 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, 2025, all of the Company’s securitized loan pools were in compliance with applicable contractual triggers. Interest Expense The Company incurred interest expense of $ 232 million, $ 249 million, and $ 251 million during 2025, 2024, and 2023 excluding interest expense associated with non-recourse vacation ownership debt. These amounts include offsets of $ 1 86 Table of Contents million, $ 1 million, and less than $ 1 million of capitalized interest during 2025, 2024, and 2023. Cash paid related to such interest was $ 213 million, $ 245 million, and $ 239 million during 2025, 2024, and 2023. Interest expense incurred in connection with the Company’s non-recourse vacation ownership debt was $ 135 million, $ 136 million, and $ 112 million during 2025, 2024, and 2023, and is reported within Consumer financing interest on the Consolidated Statements of Income. Cash paid related to such interest was $ 111 million, $ 113 million, and $ 82 million during 2025, 2024, and 2023. 16. Variable Interest Entities The Company analyzes its variable interests, including loans, guarantees, interests in special purpose entities (“SPEs”), and equity investments, to determine if an entity in which the Company has a variable interest is a VIE. If the entity is deemed to be a VIE, the Company consolidates those VIEs for which the Company is the primary beneficiary. Vacation Ownership Contract Receivables Securitizations The Company pools qualifying VOCRs and sells them to bankruptcy-remote entities. VOCRs qualify for securitization based primarily on the credit strength of the VOI purchaser to whom financing has been extended. VOCRs are securitized through bankruptcy-remote SPEs that are consolidated within the Company’s Consolidated Financial Statements. As a result, the Company does not recognize gains or losses resulting from these securitizations at the time of sale to the SPEs. Interest income is recognized when earned over the contractual life of the VOCRs. The Company services the securitized VOCRs pursuant to servicing agreements negotiated on an arm’s-length basis based on market conditions. The activities of these SPEs are limited to (i) purchasing VOCRs from the Company’s vacation ownership subsidiaries, (ii) issuing debt securities and/or borrowing under a conduit facility to fund such purchases, and (iii) entering into derivatives to hedge interest rate exposure. The bankruptcy-remote SPEs are legally separate from the Company. The receivables held by the bankruptcy-remote SPEs are not available to creditors of the Company and legally are not assets of the Company. Additionally, the non-recourse debt that is securitized through the SPEs is legally not a liability of the Company and thus, the creditors of these SPEs have no recourse to the Company for principal and interest. The assets and liabilities of these vacation ownership SPEs are as follows (in millions): As of December 31, 2025 2024 Securitized contract receivables, gross (a) $ 2,281 $ 2,293 Securitized restricted cash (b) 87 92 Interest receivables on securitized contract receivables (c) 19 19 Other assets (d) 8 8 Total SPE assets 2,395 2,412 Non-recourse term notes (e)(f) 1,690 1,746 Non-recourse conduit facilities (e) 434 377 Other liabilities (g) 1 3 Total SPE liabilities 2,125 2,126 SPE assets in excess of SPE liabilities $ 270 $ 286 (a) Included in Vacation ownership contract receivables, net on the Consolidated Balance Sheets. (b) Included in Restricted cash on the Consolidated Balance Sheets. (c) Included in Trade receivables, net on the Consolidated Balance Sheets. (d) Primarily includes deferred financing costs for the bank conduit facilities and a security investment asset, which is included in Other assets on the Consolidated Balance Sheets. (e) Included in Non-recourse vacation ownership debt on the Consolidated Balance Sheets. (f) Includes deferred financing costs of $ 23 million as of both December 31, 2025 and 2024, related to non-recourse debt. (g) Primarily includes accrued interest on non-recourse debt, which is included in Accrued expenses and other liabilities on the Consolidated Balance Sheets. 87 Table of Contents In addition, the Company has VOCRs that have not been securitized through bankruptcy-remote SPEs. Such gross receivables were $ 1.02 billion and $ 940 million as of December 31, 2025 and 2024. A summary of total vacation ownership receivables and other securitized assets, net of securitized liabilities and the allowance for loan losses, is as follows (in millions): As of December 31, 2025 2024 SPE assets in excess of SPE liabilities $ 270 $ 286 Non-securitized contract receivables 1,020 940 Less: allowance for loan losses 663 614 Total, net $ 627 $ 612 17. Fair Value The Company measures its financial assets and liabilities at fair value on a recurring basis and utilizes the fair value hierarchy to determine such fair values. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1: Quoted prices for identical instruments in active markets. Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value driver is observable. Level 3: Unobservable inputs used when little or no market data is available. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement falls has been determined based on the lowest level input (closest to Level 3) that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company’s derivative instruments currently consist of foreign exchange forward contracts and interest rate caps. See Note 18— Financial Instruments for additional details. As of December 31, 2025, the Company had no foreign exchange contracts resulting in an asset and less than $ 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. The impact of interest rate caps was immaterial as of December 31, 2025 and 2024. For assets and liabilities that are measured using quoted prices in active markets, the fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using other significant observable inputs are valued by reference to similar assets and liabilities. For these items, a significant portion of fair value is derived by reference to quoted prices of similar assets and liabilities in active markets. For assets and liabilities that are measured using significant unobservable inputs, fair value is primarily derived using a fair value model, such as a discounted cash flow model. The fair value of financial instruments is generally determined by reference to market values resulting from trading on a national securities exchange or in an over-the-counter market. In cases where quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques, as appropriate. 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. 88 Table of Contents The carrying amounts and estimated fair values of all other financial instruments were as follows (in millions): December 31, 2025 December 31, 2024 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Assets Vacation ownership contract receivables, net (Level 3) $ 2,638 $ 2,866 $ 2,619 $ 2,900 Liabilities Debt (Level 2) $ 5,598 $ 5,612 $ 5,591 $ 5,537 The Company estimates the fair value of its VOCRs using a discounted cash flow model which it believes is comparable to the model that an independent third-party would use in the current market. The model uses Level 3 inputs consisting of default rates, prepayment rates, coupon rates, and loan terms for the contract receivables portfolio as key drivers of risk and relative value that, when applied in combination with pricing parameters, determines the fair value of the underlying contract receivables. 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). 18. Financial Instruments The designation of a derivative instrument as a hedge and its ability to meet the hedge accounting criteria determine how the change in fair value of the derivative instrument will be reflected on the Consolidated Financial Statements. A derivative qualifies for hedge accounting if, at inception, the derivative is expected to be highly effective in offsetting the underlying hedged cash flows or fair value, and the hedge documentation standards are fulfilled at the time the Company enters into the derivative contract. A hedge is designated as a cash flow hedge based on the exposure being hedged. The asset or liability value of the derivative will change in tandem with its fair value. Changes in fair value for qualifying cash flow hedges, are recorded in Accumulated other comprehensive loss (“AOCL”). The derivative’s gain or loss is released from AOCL to match the timing of the underlying hedged cash flows. A hedge is designated as a fair value hedge when the derivative is used to manage an exposure to changes in the fair value of a recognized asset or liability. For fair value hedges, the portion of the gain or loss on the derivative instrument designated as a fair value hedge will be recognized in earnings. The Company concurrently records changes in the value of the hedged asset or liability via a basis adjustment to the hedged item. These two changes in fair value offset one another in whole or in part and are reported in the same statement of income line item as the hedged risk. The Company reviews the effectiveness of its hedging instruments on an ongoing basis and discontinues hedge accounting for any hedge that it no longer considers to be highly effective. The Company recognizes changes in fair value for derivatives not designated as hedges or those not qualifying for hedge accounting in current period earnings. Upon termination of cash flow hedges, the Company releases gains and losses from AOCL based on the timing of the underlying cash flows, unless the termination results from the failure of the intended transaction to occur in the expected time frame. Such untimely transactions require the Company to immediately recognize in earnings gains and losses previously recorded in AOCL. Changes in interest rates and foreign exchange rates expose the Company to market risk. The Company periodically uses cash flow and fair value hedges as part of its overall strategy to manage its exposure to market risks associated with fluctuations in interest rates and foreign currency exchange rates. As a matter of policy, the Company only enters into transactions that it believes will be highly effective at offsetting the underlying risk and it does not use derivatives for trading or speculative purposes. The Company uses the following derivative instruments to mitigate its foreign currency exchange rate and interest rate risks: Foreign Currency Risk The Company has foreign currency rate exposure to exchange rate fluctuations worldwide with particular exposure to the Euro, British pound sterling, Australian and Canadian dollars, and Mexican peso. 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 89 Table of Contents exposure to changes in forecasted foreign currency denominated vendor payments. As of December 31, 2025, the Company had no gains or losses relating to foreign currency contracts designated as cash flow hedges included in AOCL. Interest Rate Risk A portion of the debt used to finance the Company’s operations is exposed to interest rate fluctuations. The Company periodically uses financial derivatives to strategically adjust its mix of fixed to floating rate debt. The derivative instruments utilized include interest rate swaps which convert fixed-rate debt into variable-rate debt (i.e. fair value hedges) and interest rate caps (undesignated hedges) to manage the overall interest cost. For relationships designated as fair value hedges, changes in fair value of the derivatives are recorded in income, with offsetting adjustments to the carrying amount of the hedged debt. As of December 31, 2025, the Company had no interest rate derivatives designated as fair value or cash flow hedges. There were no losses on derivatives recognized in AOCL for the years ended December 31, 2025, 2024, or 2023. The following table summarizes information regarding the (losses)/gains recognized in income on the Company’s freestanding derivatives (in millions): Year Ended December 31, 2025 2024 2023 Non-designated hedging instruments Foreign exchange contracts (a) $ ( 2 ) $ ( 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. Credit Risk and Exposure The Company is exposed to counterparty credit risk in the event of nonperformance by counterparties to various agreements and sales transactions. The Company manages such risk by evaluating the financial position and creditworthiness of such counterparties and by requiring collateral in instances in which financing is provided. The Company mitigates counterparty credit risk associated with its derivative contracts by monitoring the amounts at risk with each counterparty to such contracts, periodically evaluating counterparty creditworthiness and financial position, and where possible, dispersing its risk among multiple counterparties. As of December 31, 2025, there were no significant concentrations of credit risk with any individual counterparty or groups of counterparties. With the exception of the financing provided to customers of its vacation ownership businesses, the Company does not normally require collateral or other security to support credit sales. Market Risk The Company is subject to risks relating to the geographic concentrations of (i) areas in which the Company is currently developing and selling vacation ownership properties, (ii) sales offices in certain vacation areas, and (iii) customers of the Company’s Vacation Ownership business, which in each case, may result in the Company’s results of operations being more sensitive to local and regional economic conditions and other factors, including competition, extreme weather conditions and other natural disasters, and economic downturns, than the Company’s results of operations would be, absent such geographic concentrations. Local and regional economic conditions and other factors may differ materially from prevailing conditions in other parts of the world. Florida, California, and Nevada are examples of areas with concentrations of sales offices. For the year ended December 31, 2025, the Company generated 21 %, 12 %, and 9 % 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. Included within the Consolidated Statements of Income are net revenues generated in the state of Florida of 17 %, during 2025, and 15 % for both 2024 and 2023; net revenues generated in California of 10 %, 11 %, and 10 %; and net revenues generated in Nevada of 7 %, 8 %, and 10 % during these periods. 90 Table of Contents 19. Commitments and Contingencies COMMITMENTS Leases The Company is committed to making finance and operating lease payments covering various facilities and equipment. Total future minimum lease obligations are $ 207 million, including finance leases, operating leases, leases signed but not yet commenced, and leases with a lease term of less than 12 months. See Note 12— Leases for additional detail. Purchase Commitments 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, 2025, aggregated to $ 1.09 billion, of which $ 501 million were for marketing-related activities, $ 398 million were related to the development of vacation ownership properties, and $ 126 million were for information technology activities. Letters of Credit As of December 31, 2025, the Company had $ 81 million of irrevocable standby letters of credit outstanding, of which $ 44 million was under its revolving credit facility. 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. The letters of credit issued during 2025 and 2024 also supported the securitization of VOCR fundings, certain insurance policies, and development activity at the Company’s Vacation Ownership segment. Surety Bonds 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. In the ordinary course of the Company’s business, it has assembled commitments from 13 surety providers in the amount of $ 2.38 billion, of which the Company had $ 542 million outstanding as of December 31, 2025. The availability, terms and conditions, and pricing of bonding capacity are dependent on, among other things, continued financial strength and stability of the insurance company affiliates providing the bonding capacity, general availability of such capacity, and the Company’s corporate credit rating. If the bonding capacity is unavailable or, alternatively, the terms and conditions and pricing of the bonding capacity are unacceptable to the Company, its Vacation Ownership business could be negatively impacted. L ITIGATION The Company is involved in claims, legal and regulatory proceedings, and governmental inquiries related to its business, none of which, in the opinion of management, is expected to have a material effect on the Company’s results of operations or financial condition. Travel + Leisure Co. Litigation The Company may be from time to time involved in claims, legal and regulatory proceedings, and governmental inquiries arising in the ordinary course of its business including but not limited to: for its Vacation Ownership business — breach of contract, bad faith, conflict of interest, fraud, consumer protection and other statutory claims by property owners’ associations, owners and prospective owners in connection with the sale or use of VOIs or land, or the management of vacation ownership resorts, construction defect claims relating to vacation ownership units or resorts or in relation to guest reservations and bookings; and negligence, breach of contract, fraud, consumer protection and other statutory claims by guests and other consumers for alleged injuries sustained at or acts or occurrences related to vacation ownership units or resorts or in relation to guest reservations and bookings; for its Travel and Membership business — breach of contract, fraud and bad faith claims by affiliates and customers in connection with their respective agreements, negligence, breach of contract, fraud, consumer protection and other statutory claims asserted by members, guests and other consumers for alleged injuries sustained at or acts or occurrences related to affiliated resorts, or in relation to guest reservations and bookings; and for each of its businesses, bankruptcy proceedings involving efforts to collect receivables from a debtor in bankruptcy, employment matters including but not limited to, claims of wrongful termination, retaliation, discrimination, harassment and wage and hour claims, whistleblower claims, claims of infringement upon third parties’ intellectual property rights, claims relating to information security, privacy and consumer protection, fiduciary duty/trust claims, tax claims, environmental claims, and landlord/tenant disputes. 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 91 Table of Contents 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. The Company believes that it has adequately accrued for such matters with estimated liabilities of $ 2 million and $ 4 million as of December 31, 2025 and 2024. Litigation is inherently unpredictable and, although the Company believes that its accruals are adequate and/or that it has valid defenses in these matters, unfavorable results could occur. As such, an adverse outcome from such proceedings for which claims are awarded in excess of the amounts accrued, if any, could be material to the Company with respect to earnings and/or cash flows in any given reporting period. As of December 31, 2025, it is estimated that the potential exposure resulting from adverse outcomes of such legal proceedings could, in the aggregate, range up to $ 16 million in excess of recorded accruals. Such accruals are exclusive of matters relating to the Company’s separation from the Company’s former parent ABG, matters relating to the spin-off of Wyndham Hotels & Resorts, Inc. (“Spin-off”), and matters relating to the sale of the vacation rentals businesses, which are discussed in Note 26— 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. For matters deemed reasonably possible, therefore not requiring accrual, the Company believes that such matters will not have a material effect on its results of operations, financial position or cash flows based on information currently available. In addition to the items listed above, the Company has reached an agreement in principle with the SEC Staff to settle an inquiry relating to its disclosures regarding certain delinquent and defaulted loans that the Company agreed to rescind in 2019 and 2020. The proposed settlement is subject to approval by the SEC. Until it is approved, there can be no assurance that the matter will ultimately be resolved on terms acceptable to the Company and the SEC. The proposed settlement, which would be entered into on a neither admit nor deny basis, involves non-scienter-based violations of the federal securities laws by the Company and a civil monetary penalty of $ 975,000 . Such amount has been accrued within Accrued expenses and other liabilities on the Consolidated Balance sheet for the year ended December 31, 2025. G UARANTEES /I NDEMNIFICATIONS Standard Guarantees/Indemnifications In the ordinary course of business, the Company enters into agreements that contain standard guarantees and indemnities whereby the Company indemnifies another party for specified breaches of, or third-party claims relating to, an underlying agreement. Such underlying agreements are typically entered into by one of the Company’s subsidiaries. The various underlying agreements generally govern purchases, sales or outsourcing of products or services, leases of real estate, licensing of software and/or development of vacation ownership properties, customer data safeguards, access to credit facilities, derivatives and issuances of debt securities. Also in the ordinary course of business, the Company provides corporate guarantees for its operating business units relating to merchant credit-card processing for prepaid customer stays and other deposits. While a majority of these guarantees and indemnifications extend only for the duration of the underlying agreement, some survive the expiration of the agreement. The Company is not able to estimate the maximum potential amount of future payments to be made under these guarantees and indemnifications as the triggering events are not predictable. In certain cases, the Company receives offsetting indemnifications from third-parties and/or maintains insurance coverage that may mitigate any potential payments. Other Guarantees and Indemnifications Vacation Ownership As part of the Fee-for-Service program, the Company may guarantee to reimburse the developer a certain payment or to purchase inventory from the developer, for a percentage of the original sale price if certain future conditions exist. As of December 31, 2025, the maximum potential future payments that the Company may be required to make under these guarantees is $ 59 million. As of December 31, 2025 and 2024, the Company had no recognized liabilities in connection with these guarantees. For information on guarantees and indemnifications related to the Company’s former parent and subsidiaries see Note 26— Transactions with Former Parent and Former Subsidiaries . 92 Table of Contents 20. Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss are as follows (in millions): Pretax Foreign Currency Translation Adjustments Defined Benefit Pension Plans Accumulated Other Comprehensive Loss Balance as of December 31, 2022 $ ( 178 ) $ — $ ( 178 ) Other comprehensive income 8 1 9 Balance as of December 31, 2023 ( 170 ) 1 ( 169 ) Other comprehensive loss ( 40 ) — ( 40 ) Balance as of December 31, 2024 ( 210 ) 1 ( 209 ) Other comprehensive income 46 — 46 Balance as of December 31, 2025 $ ( 164 ) $ 1 $ ( 163 ) Tax Foreign Currency Translation Adjustments Defined Benefit Pension Plans Accumulated Other Comprehensive Loss Balance as of December 31, 2022 $ 99 $ — $ 99 Other comprehensive loss — — — Balance as of December 31, 2023 99 — 99 Other comprehensive loss ( 2 ) — ( 2 ) Balance as of December 31, 2024 97 — 97 Other comprehensive loss — — — Balance as of December 31, 2025 $ 97 $ — $ 97 Net of Tax Foreign Currency Translation Adjustments Defined Benefit Pension Plans Accumulated Other Comprehensive Loss Balance as of December 31, 2022 $ ( 79 ) $ — $ ( 79 ) Other comprehensive income 8 1 9 Balance as of December 31, 2023 ( 71 ) 1 ( 70 ) Other comprehensive loss ( 42 ) — ( 42 ) Balance as of December 31, 2024 ( 113 ) 1 ( 112 ) Other comprehensive income 46 — 46 Balance as of December 31, 2025 $ ( 67 ) $ 1 $ ( 66 ) 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. The Company's policy for releasing disproportionate income tax effects from AOCL utilizes the aggregate approach. There were no reclassifications out of AOCL during 2025 or 2024. 21. Stock-Based Compensation 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. 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, 2025, based on number of awards granted at target performance levels, 9.4 million shares remained available. Incentive Equity Awards Granted by the Company During the year ended December 31, 2025, the Company granted incentive equity awards to key employees and senior officers of $ 43 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 93 Table of Contents 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, 2024, the Company granted incentive equity awards of $ 34 million in the form of RSUs and $ 10 million in the form of PSUs. During 2023 the Company granted incentive equity awards of $ 35 million in the form of RSUs and $ 21 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, 2025, consisted of the following (in millions, except grant prices): Balance as of December 31, 2024 Granted Performance Adjustment (a) Vested/Exercised (b) Cancelled / Forfeited (c) Balance as of December 31, 2025 RSUs Number of RSUs 1.6 0.8 — ( 0.6 ) ( 0.1 ) 1.7 (d) Weighted average grant price $ 45.99 $ 55.58 $ — $ 47.84 $ 47.60 $ 49.64 PSUs Number of PSUs 0.9 0.2 0.1 ( 0.3 ) — 0.9 (e) Weighted average grant price $ 45.17 $ 54.46 $ 52.87 $ 52.87 $ — $ 46.08 NQs Number of NQs 1.4 — — ( 0.5 ) — 0.9 (f) Weighted average grant price $ 43.40 $ — $ — $ 42.50 $ — $ 43.97 (a) Represents additional shares awarded as the Company exceeded target performance metrics at the end of the associated performance period. (b) Upon exercise of NQs and vesting of RSUs and PSUs, the Company issues new shares to participants. (c) The Company recognizes cancellations and forfeitures as they occur. (d) Aggregate unrecognized compensation expense related to RSUs was $ 55 million as of December 31, 2025, which is expected to be recognized over a weighted average period of 2.5 years. (e) The aggregate unrecognized compensation expense related to PSUs that are probable of vesting was $ 13 million as of December 31, 2025, which is expected to be recognized over a weighted average period of 1.8 years. The maximum amount of compensation expense associated with PSUs that are not probable of vesting could range up to $ 2 million which would be recognized over a weighted average period of 0.2 years. (f) There were 0.9 million NQs which were exercisable as of December 31, 2025. These exercisable NQs will expire over a weighted average period of 4.1 years and carry a weighted average grant date fair value of $ 9.08 . There was no unrecognized compensation expense for NQs as of December 31, 2025. The Company did not grant any stock options during the years 2025, 2024, or 2023. The fair value of stock options granted by the Company prior to 2023 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 represented the period of time these awards were expected to be outstanding. The risk-free interest rate was based on yields on U.S. Treasury strips with a maturity similar to the estimated expected life of the options. 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. The Company received $ 24 million, $ 6 million, and less than $ 1 million from option exercises during 2025, 2024, and 2023. The total intrinsic value of options exercised was $ 10 million, $ 1 million, and less than $ 1 million during 2025, 2024, and 2023. The vest date fair value of shares that vested were $ 53 million, $ 35 million, and $ 37 million during 2025, 2024, and 2023. Stock-Based Compensation Expense The Company recorded stock-based compensation expense of $ 57 million, $ 41 million, and $ 38 million during 2025, 2024, and 2023, related to the incentive equity awards granted to key employees, senior officers, and non-employee directors. During 2024 and 2023 such stock-based compensation expense includes $ 1 million and $ 2 million which has been 94 Table of Contents classified within Restructuring on the Consolidated Statements of Income. The Company recognized $ 17 million, $ 11 million, and $ 9 million of tax benefits associated with stock-based compensation during 2025, 2024, and 2023. The Company paid $ 14 million, $ 9 million, and $ 10 million of taxes for the net share settlement of incentive equity awards that vested during 2025, 2024, and 2023. Such amounts are included within Financing activities on the Consolidated Statements of Cash Flows. 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 off the fair market value at the grant date. The Company issued 0.2 million shares under this plan during each of 2025, 2024, and 2023 and recognized $ 1 million of compensation expense for each of these issuances. The value of shares issued under this plan was $ 10 million, $ 9 million, and $ 10 million during 2025, 2024, and 2023. 22. Employee Benefit Plans Defined Contribution Benefit Plans Travel + Leisure Co. sponsors domestic defined contribution savings plans and a domestic deferred compensation plan that provide eligible employees of the Company an opportunity to accumulate funds for retirement. The Company matches the contributions of participating employees on the basis specified by each plan. The Company’s cost for these plans was $ 36 million, $ 34 million, and $ 33 million during 2025, 2024, and 2023. In addition, the Company contributes to several foreign employee benefit contributory plans which also provide eligible employees with an opportunity to accumulate funds for retirement. The Company’s contributory cost for these plans was $ 12 million, $ 10 million, and $ 9 million during 2025, 2024, and 2023. Defined Benefit Pension Plans The Company sponsors defined benefit pension plans for certain foreign subsidiaries. Under these plans, benefits are based on an employee’s years of credited service and a percentage of final average compensation or as otherwise described by the plan. The Company had $ 7 million and $ 5 million of net pension liability as of December 31, 2025 and 2024, included within Accrued expenses and other liabilities on the Consolidated Balance Sheets. As of December 31, 2025 and 2024 the Company had less than $ 1 million and $ 1 million of unrecognized gains associated with these plans included within Accumulated other comprehensive loss on the Consolidated Balance Sheets. 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. The Company recognized no pension expense during 2025, 2024, or 2023 . 23. Segment Information The Company has two reportable segments: Vacation Ownership and Travel and Membership. 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. Based on this analysis the Company aggregates two geographical operating segments within the Vacation Ownership reportable segment and two operating segments within the Travel and Membership reportable segment. 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. 95 Table of Contents During the fourth quarter of 2025, the Company updated its definition of Adjusted EBITDA to exclude inventory write-downs associated with the Company’s resort optimization initiative. This initiative resulted in inventory write-downs related to agreements to supply replacement inventory to vacation ownership clubs impacted by this initiative. These charges are included within Cost of vacation ownership interests on the Consolidated Statements of Income. For additional detail on the resort optimization initiative see Note 25— Restructuring. 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 and inventory write-downs associated with the Company’s resort optimization initiative, 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. Integration costs represent certain non-recurring costs directly incurred to integrate mergers and/or acquisitions into the existing business. The Company excludes these costs as they do not reflect recurring operating expenses. The Company believes that Adjusted EBITDA is a useful measure of performance for its segments which, when considered with GAAP measures, gives a more complete understanding of its operating performance. The Company’s presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies. 96 Table of Contents The following tables present the Company’s segment information (in millions): Year Ended December 31, 2025 Net revenues Vacation Ownership Travel and Membership Total Revenues from external customers $ 3,361 (a) $ 658 $ 4,019 Intersegment revenues — 4 4 3,361 662 4,023 Reconciliation of revenues Other revenues (b) 2 Elimination of intersegment revenues ( 4 ) Total consolidated revenues $ 4,021 Less: Property management expense 683 — (c) Marketing 440 (d) 42 Commissions 427 — (c) General and administrative (e) 244 92 Sales administration 218 — (c) Consumer financing interest 135 — (c) Developer obligations (f) 111 — (c) Licensing fees 103 — (c) Cost of sales 58 (g) 193 Fee-for-Service expenses 48 — (c) Contact center — (c) 71 Resort services — (c) 30 Other segment items (h) 33 6 Reportable segment Adjusted EBITDA $ 861 $ 228 $ 1,089 Other Adjusted EBITDA ( 99 ) Adjusted EBITDA $ 990 Reconciliation of Adjusted EBITDA Total Adjusted EBITDA $ 990 Inventory write-downs and asset impairments, net (i) ( 226 ) Stock-based compensation ( 57 ) Restructuring ( 19 ) Other (j) ( 3 ) Acquisition and divestiture related costs ( 1 ) Depreciation and amortization ( 124 ) Interest income 9 Interest expense ( 232 ) Income before income taxes 337 Provision for income taxes ( 107 ) Net income attributable to Travel + Leisure Co. shareholders $ 230 (a) Includes $ 484 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. (c) Expense category not regularly provided to the CODM for this segment. (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, excluding $ 216 million of inventory write-downs and impairments which are not included in the determination of Adjusted EBITDA. (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. (i) Includes $ 216 million of inventory write-downs and impairments related to the Company’s resort optimization initiative included in Cost of vacation ownership interests on the Consolidated Statements of Income. 97 Table of Contents (j) Includes $ 5 million of employee costs associated with the Company’s resort optimization initiative included within Operating expense on the Consolidated Statements of Income, and $ 2 million of other items that meet the conditions of unusual and/or infrequent, partially offset by a $ 4 million gain on sale of a corporate building owned by the Travel and Membership segment, which was previously held-for-sale. Year Ended December 31, 2024 Net revenues Vacation Ownership Travel and Membership Total Revenues from external customers $ 3,171 (a) $ 691 $ 3,862 Intersegment revenues — 4 4 3,171 695 3,866 Reconciliation of revenues Other revenues (b) 2 Elimination of intersegment revenues ( 4 ) Total consolidated revenues $ 3,864 Less: Property management expense 643 — (c) Marketing 411 (d) 45 Commissions 406 — (c) General and administrative (e) 231 100 Sales administration 194 — (c) Consumer financing interest 136 — (c) Developer obligations (f) 129 — (c) Licensing fees 94 — (c) Cost of sales 92 (g) 186 Fee-for-Service expenses 43 — (c) Contact center — (c) 77 Resort services — (c) 33 Other segment items (h) 28 3 Reportable segment Adjusted EBITDA $ 764 $ 251 $ 1,015 Elimination of intersegment Adjusted EBITDA 32 Other Adjusted EBITDA ( 118 ) Adjusted EBITDA $ 929 Reconciliation of Adjusted EBITDA Total Adjusted EBITDA $ 929 Stock-based compensation ( 40 ) Restructuring (i) ( 16 ) Legacy items ( 11 ) Asset impairments, net ( 3 ) Acquisition and divestiture related deal costs ( 2 ) Fair value change in contingent consideration 7 Integration costs ( 1 ) Depreciation and amortization ( 115 ) Interest income 14 Interest expense ( 249 ) Income before income taxes 513 Provision for income taxes ( 135 ) 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. (c) Expense category not regularly provided to the CODM for this segment. (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. 98 Table of Contents (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) 5 Elimination of intersegment revenues ( 7 ) Total consolidated revenues $ 3,750 Less: Property management expense 607 — (c) Marketing 360 (d) 58 Commissions 358 — (c) General and administrative (e) 232 105 Sales administration 179 — (c) Cost of sales 132 (f) 180 Developer obligations (g) 129 — (c) Consumer financing interest 112 — (c) Licensing fees 89 — (c) Fee-for-Service expenses 81 — (c) Contact center — (c) 79 Resort services — (c) 38 Other segment items (h) 33 4 Reportable segment Adjusted EBITDA $ 729 $ 247 $ 976 Elimination of intersegment Adjusted EBITDA ( 1 ) Other Adjusted EBITDA ( 67 ) Adjusted EBITDA $ 908 Reconciliation of Adjusted EBITDA Total Adjusted EBITDA $ 908 Stock-based compensation ( 36 ) Restructuring (i) ( 26 ) Legacy items ( 8 ) Loss on sale of business ( 2 ) Inventory write-downs and asset impairments, net (j) ( 1 ) Depreciation and amortization ( 112 ) Interest income 13 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. (c) Expense category not regularly provided to the CODM for this segment. (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. 99 Table of Contents (g) Represents maintenance fees incurred by the Company for unsold VOIs, net of monetization. (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 $ 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. The following tables present the Company’s segment asset information (in millions): As of December 31, Segment Assets (a) 2025 2024 Vacation Ownership $ 5,022 $ 5,112 Travel and Membership 1,334 1,325 Total reportable segments 6,356 6,437 Corporate and other 404 298 Total Company $ 6,760 $ 6,735 (a) Excludes investment in consolidated subsidiaries. Year Ended December 31, Capital Expenditures 2025 2024 2023 Vacation Ownership $ 54 $ 54 $ 47 Travel and Membership 17 19 22 Total reportable segments 71 73 69 Corporate and other 46 8 5 Total Company $ 117 $ 81 $ 74 The geographic segment information provided below is classified based on the geographic location of the Company’s subsidiaries (in millions): Net Revenues Net Long-lived Assets Year Ended December 31, As of December 31, 2025 2024 2023 2025 2024 United States $ 3,545 $ 3,404 $ 3,320 $ 1,439 $ 1,508 All other countries 476 460 430 265 258 Total $ 4,021 $ 3,864 $ 3,750 $ 1,704 $ 1,766 24. Impairments and Other Charges During 2025, the Company recognized $ 10 million of Asset impairments, net on the Consolidated Statements of Income. These impairments included fixed asset impairments of $ 8 million at the Vacation Ownership segment resulting from the resort optimization initiative discussed in Note 25— Restructuring , $ 1 million related to held-for-sale assets and $ 1 million related to a tradename impairment at the Travel and Membership segment. In connection with the resort optimization initiative , the Company also incurred $ 216 million of inventory write-downs and impairments at its Vacation Ownership segment during the period associated with the removal of certain identified resorts from the Company’s portfolio and agreements to supply replacement inventory to vacation ownership clubs impacted by this initiative. These charges are included within Cost of vacation ownership interests on the Consolidated Statements of Income. 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 2023, the Company recorded a $ 1 million inventory impairment at the Vacation Ownership segment included within Cost of vacation ownership interests on the Consolidated Statements of Income. 100 Table of Contents 25. Restructuring Resort Optimization Initiative In order to promote the long-term strength of its portfolio of vacation ownership resorts, the Company undertook a strategic review with the intent of optimizing the overall quality of its resort portfolio, aligning with evolving owner preferences, preserving the affordability of maintenance fees, and mitigating the need for costly special assessments in the future. This review identified 17 resorts requiring significant owner reinvestment, or are in markets that no longer align with owner demand. As a result, during 2025, the Company proposed to the boards of these respective homeowners’ associations (“HOAs”) of the identified resorts, court-supervised restructuring plans to remove select resorts from the Company’s portfolio and reduce the number of units at certain other resorts. As of December 31, 2025, the Company had received confirmation of both HOA board and required member approvals of the proposed actions for all but two HOAs at one of the identified resorts. Member votes to decide on the proposed restructuring plans for the two remaining HOAs are scheduled to occur during the first quarter of 2026. When completed, the identified resorts and related assets of the respective HOAs will be sold, and all owners, including the Company and its vacation ownership clubs, will receive pro-rata distributions of the net sales proceeds. The Company anticipates that the respective HOAs will receive the necessary court approvals for the sale of the property governed by the HOAs by the end of 2026. Related to this initiative, during the fourth quarter the Company has executed agreements to supply replacement inventory to its vacation ownership clubs impacted by the removal of the identified resorts in exchange for the clubs’ pro-rata distributions of net sales proceeds. During 2025, the Company incurred $ 233 million of costs associated in connection with these actions, including $ 216 million of inventory write-downs and impairments at its Vacation Ownership segment associated with the removal of the identified resorts and the agreements to supply replacement inventory to the impacted vacation ownership clubs. The valuation method used in the determination of the fair value of this inventory was based on a discounted cash flow model which used Level 3 inputs consisting of available property information and comparable sales to estimate income and operating expenses to determine an estimated price range. The Company’s financial statements included the following impacts related to the resort optimization initiative (in millions): Year Ended December 31, 2025 Income Statement Classification Inventory write-downs $ 195 Cost of vacation ownership interests Inventory impairments 21 Cost of vacation ownership interests Fixed asset impairments 8 Asset impairments, net Severance and related benefits 4 Restructuring Other employee related costs 5 Operating Total resort optimization initiative costs $ 233 As of December 31, 2025, there were $ 4 million of restructuring liabilities associated with this initiative, which are expected to be paid by the end of 2027. 2025 Restructuring Plan During 2025, the Company incurred $ 15 million of restructuring charges associated with the 2025 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 250 employees and other expenses. The 2025 restructuring plan charges consisted of (i) $ 7 million of personnel-related costs at the Company’s corporate operations, (ii) $ 5 million of personnel-related costs and $ 2 million of fees associated with the termination of a licensing agreement at the Travel and Membership segment, and (iii) $ 1 million of personnel-related costs at the Vacation Ownership segment. All material initiative and related expenses have been incurred as of December 31, 2025. The 2025 restructuring liability was reduced by $ 3 million of cash payments during the year ended December 31, 2025. The remaining 2025 restructuring liability of $ 12 million is expected to be paid by the end of 2027. 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, 101 Table of Contents (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, 2025. The 2024 restructuring liability was reduced by $ 7 million of cash payments during each of the years ended December 31, 2025 and 2024. As of December 31, 2025, the 2024 restructuring liability has been fully settled. 2023 Restructuring Plan During 2023, the Company incurred $ 26 million of restructuring charges. These actions were primarily focused on enhancing organizational efficiency and rationalizing operations. These charges included personnel-related costs resulting from a reduction of approximately 250 employees and other expenses. As part of this restructuring plan, the Company decided to decrease its facilities by closing its owned office in Indianapolis, Indiana, and exiting other leased locations. The 2023 restructuring plan charges consisted of (i) $ 11 million of personnel-related costs at the Travel and Membership segment, (ii) $ 9 million of personnel-related costs and $ 1 million of lease costs at the Vacation Ownership segment, and (iii) $ 5 million of personnel-related costs at the Company’s corporate operations. 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. The 2023 restructuring liability was reduced by less than $ 1 million, $ 14 million and $ 8 million of cash payments during the years ended December 31, 2025, 2024, and 2023. As of December 31, 2025, the 2023 restructuring liability has been fully settled. The Company had additional restructuring plans which were implemented prior to 2023, related to leased facilities and personnel-related costs. During 2024, the Company recognized $ 1 million of stock-based compensation expense associated with the 2022 restructuring plan. These restructuring liabilities were reduced by $ 3 million, $ 3 million, and $ 2 million of cash payments during the years ended December 31, 2025, 2024, and 2023. As of December 31, 2025, the remaining liability of $ 12 million is expected to be paid by the end of 2029. The activity associated with the Company’s restructuring plans is summarized as follows (in millions): Liability as of 2023 Activity Liability as of December 31, 2022 Costs Recognized Cash Payments Other December 31, 2023 Facility-related $ 20 $ 1 $ ( 4 ) $ — $ 17 Personnel-related 6 25 ( 13 ) ( 2 ) (a) 16 $ 26 $ 26 $ ( 17 ) $ ( 2 ) $ 33 Liability as of 2024 Activity Liability as of December 31, 2023 Costs Recognized Cash Payments Other December 31, 2024 Facility-related $ 17 $ 1 $ ( 3 ) $ — $ 15 Personnel-related 16 15 ( 22 ) ( 1 ) (a) 8 $ 33 $ 16 $ ( 25 ) $ ( 1 ) $ 23 Liability as of 2025 Activity Liability as of December 31, 2024 Costs Recognized Cash Payments Other December 31, 2025 Facility-related $ 15 $ — $ ( 3 ) $ — $ 12 Personnel-related 8 17 ( 11 ) — (a) 14 Other — 2 — — 2 $ 23 $ 19 $ ( 14 ) $ — $ 28 (a) Represents stock-based compensation expense included in Additional paid-in capital on the Consolidated Balance Sheets. 26. Transactions with Former Parent and Former Subsidiaries Matters Related to Former Parent Pursuant to the Separation and Distribution Agreement with the Company’s former parent, ABG, the Company entered into certain guarantee commitments with ABG and ABG’s former subsidiary, Anywhere Real Estate Inc. (formerly Realogy). These guarantee arrangements primarily related to certain contingent litigation liabilities, contingent tax liabilities, and ABG contingent and other corporate liabilities, of which Wyndham Worldwide Corporation (“Wyndham 102 Table of Contents Worldwide”) 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. was effectively responsible for 25 % of such matters subsequent to the separation. 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 in favor of the California Franchise Tax Board 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; and (ii) whether a transaction undertaken by the taxpayers for the 1999 tax year constituted a tax-free reorganization under the Internal Revenue Code. ABG filed a petition for rehearing in 2023. On April 10, 2024, the OTA denied ABG’s petition. On May 27, 2025, the Company paid $ 24 million for its share of the taxes and interest, and was reimbursed $ 8 million by Wyndham Hotels for its one-third portion. ABG intends to appeal. As of December 31, 2025, the Company had $ 1 million ABG separation and related liabilities, comprised of contingent and corporate liabilities. As of December 31, 2024, the Company had $ 24 million of ABG separation and related liabilities, all of which were tax related. These liabilities are included within Accrued expenses and other liabilities on the Consolidated Balance Sheets. Matters Related to Wyndham Hotels 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. 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. In accordance with the agreements governing the relationship between Travel + Leisure Co. and Wyndham Hotels, Travel + Leisure Co. assumed two-thirds and Wyndham Hotels assumed one-third of certain contingent corporate liabilities of the Company incurred prior to the Spin-off, including liabilities of the Company related to certain terminated or divested businesses, certain general corporate matters, and any actions with respect to the separation plan. Likewise, Travel + Leisure Co. is entitled to receive two-thirds and Wyndham Hotels is entitled to receive one-third of the proceeds from certain contingent corporate assets of the Company arising prior to the Spin-off. Matters Related to the European Vacation Rentals Business In connection with the sale of the Company’s European vacation rentals business to Awaze Limited (“Awaze”), formerly Compass IV Limited, an affiliate of Platinum Equity, LLC, the Company and Wyndham Hotels agreed to certain post-closing credit support for the benefit of certain credit card service providers, a British travel association, and certain regulatory authorities to allow them to continue providing services or regulatory approval to the business. Post-closing credit support may be called if the business fails to meet its primary obligation to pay amounts when due. Awaze has provided an indemnification to Travel + Leisure Co. in the event that the post-closing credit support is enforced or called upon. At closing, the Company agreed to provide additional post-closing credit support to a British travel association and regulatory authority. An escrow was established at closing, of which $ 46 million was subsequently released in exchange for a secured bonding facility and a perpetual guarantee denominated in British pound sterling with a USD equivalent of $ 46 million. The estimated fair value of the guarantee was $ 22 million at December 31, 2025. The Company maintains a $ 7 million receivable from Wyndham Hotels for its portion of the guarantee. 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 of expense, representing Wyndham Hotels one-third share, included within General and administrative expense on the Consolidated Statements of Income. During 2024, the remaining indemnifications expired which resulted in the recognition of a $ 32 million Gain on disposal of discontinued business, net of income taxes, with an offsetting $ 12 million of expense, 103 Table of Contents 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. These guarantees totaled £ 29 million ($ 39 million USD) at December 31, 2025. Travel + Leisure Co. is responsible for two-thirds of these guarantees. The estimated fair value of the guarantees and indemnifications for which Travel + Leisure Co. is responsible related to the sale of the European vacation rentals business at December 31, 2025, including the two-thirds portion related to guarantees provided by Wyndham Hotels, totaled $ 48 million and was recorded in Accrued expenses and other liabilities and total receivables of $ 7 million were included in Other assets on the Consolidated Balance Sheets, representing the portion of these guarantees and indemnifications for which Wyndham Hotels is responsible. 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 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, 2025. 27. Related Party Transactions The Company occasionally sublets an aircraft from its former CEO and current Chairman of the Board of Directors for business travel through a timesharing arrangement. The Company incurred less than $ 1 million of expenses related to this timesharing arrangement during each of the years ended December 31, 2025, 2024, and 2023. 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. 28. Subsequent Events On February 13, 2026, the Company’s Board of Directors increased the authorization for the Company’s share repurchase program by $ 750 million. 104 Table of Contents ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.