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Item 7. Management’s Discussion and Analysis

2026-03-02 compared with 2025-02-28 · 263 added, 232 removed, 523 unchanged (49% of the section changed)

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Regis brand for specified fractional ownership products.

Our Vacation Ownership segment generates most of its revenues from four primary sources:

Our Vacation Ownership segment generates revenues from four primary sources:

selling vacation ownership products;

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We provide these services through our Interval International and Aqua-Aston businesses.

In April 2022, we disposed of VRI Americas after determining that the business was not a core component of our future growth strategy and operating model.

This business was a component of our Exchange & Third-Party Management segment through the date of the sale.

Corporate and other represents that portion of our results that are not allocable to our segments, including those relating to Consolidated Property Owners’ Associations.

Significant Accounting Policies Used in Describing Results of Operations

Corporate and other represents the portion of our results that are not allocable to our segments, including those relating to Consolidated Property Owners’ Associations.

Accounting Policies Used in Describing Results of Operations

Sale of Vacation Ownership Products

We recognize revenues from the sale of vacation ownership products (also referred to as “VOIs”) when control of the vacation ownership product is transferred to the customer and the transaction price is deemed collectible.

Based upon the different terms of our contracts with the customer and business practices, control of the vacation ownership product has historically transferred to the customer at different points in time for each brand of VOIs.

In the third quarter of 2022 and the fourth quarter of 2024, we aligned our business practices and contract terms for the sale of vacation ownership products (the “Contract Alignments”), resulting in the prospective change in the timing of the transfer of control to the

customer for Marriott-branded VOIs and Hyatt-branded VOIs derived from Legacy-Welk sales contracts, respectively.

Prior to these changes, control transfer occurred at closing for these vacation ownership products.

Subsequent to the Contract Alignments, transfer of control of these vacation ownership products occurs at expiration of the statutory rescission period, consistent with the historical timing of Sheraton-, Westin- and Hyatt- branded transactions.

Marriott-branded VOIs and Hyatt-branded VOIs derived from Legacy-Welk sales contracts executed prior to the applicable Contract Alignment have been accounted for with the transfer of control of the VOI occurring at closing.

Sales of vacation ownership products may be made for cash or we may provide financing.

In addition, we recognize settlement fees associated with the transfer of vacation ownership products and commission revenues from sales of vacation ownership products on behalf of third parties, which we refer to as “resales revenue.”

In addition, we recognize settlement fees associated with the transfer of VOIs and commission revenues from sales of VOIs on behalf of third parties, which we refer to as “resales revenue.”

We also provide sales incentives to certain purchasers.

These sales incentives typically include Marriott Bonvoy points, World of Hyatt points or an alternative sales incentive that we refer to as “plus points.” Plus points are redeemable for stays at our resorts or for use in other third-party offerings, generally up to two years from the date of issuance.

Finally, as more fully described in “ Financing ” below, we record the difference between the contract receivable or vacation ownership note receivable and the consideration to which we expect to be entitled (also known as a vacation ownership notes receivable reserve or a sales reserve) as a reduction of revenues from the sale of vacation ownership products at the time we recognize revenues from a sale.

Finally, as more fully described in “ Financing ” below, we record the difference between the contract receivable or vacation ownership note receivable and the amount we expect to collect from debtors (also known as a vacation ownership notes receivable reserve or a sales reserve) as a reduction of revenues from the sale of VOIs at the time we recognize revenues from a sale.

We report, on a supplemental basis, contract sales for our Vacation Ownership segment.

Contract sales consist of the total amount of vacation ownership product sales under contract signed during the period where we have generally received a down payment of at least ten percent of the contract price, reduced by actual rescissions during the period, inclusive of contracts associated with sales of vacation ownership products on behalf of third parties, which we refer to as “resales contract sales.” In circumstances where a customer applies any or all of their existing ownership interests as part of the purchase price for additional interests (also referred to as an equity upgrade), we include only the incremental value purchased as contract sales.

Contract sales differ from revenues from the sale of vacation ownership products that we report on our income statements due to the requirements for revenue recognition described above.

Contract sales consist of the total amount of VOI sales under contract signed during the period where we have generally received a down payment of at least ten percent of the contract price, reduced by actual rescissions during the period, inclusive of contracts associated with sales of VOIs on behalf of third parties, which we refer to as “resales contract sales.” In circumstances where a customer applies any or all of their existing ownership interests as part of the purchase price for additional interests (also referred to as an equity upgrade), we include only the incremental value purchased as contract sales.

Contract sales differ from revenues from the sale of VOIs that we report on our income statements due to the requirements for revenue recognition described above.

We consider contract sales to be an important operating measure because it reflects the pace of sales in our business.

Cost of vacation ownership products includes costs to acquire, develop and construct our projects (also known as real estate inventory costs), other non-capitalizable costs associated with the overall project development process and settlement expenses associated with the closing process.

For each project, we expense real estate inventory costs in the same proportion as the revenue recognized.

For each project, we expense inventory costs in the same proportion as the revenue recognized.

Consistent with the applicable accounting guidance, to the extent there is a change in the estimated sales revenues or inventory costs for the project in a period, a non-cash adjustment is recorded on our income statements to true up costs in that period to those that would have been recorded historically if the revised estimates had been used.

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We also receive annual membership fees, club dues and certain transaction-based fees from members, owners and other third parties.

Management and exchange expenses include costs to operate the food and beverage outlets and other ancillary operations and to provide overall customer support services, including reservations, and certain transaction-based expenses relating to exchange service providers.

Management and exchange expenses include costs to operate the food and beverage outlets, other ancillary operations and to provide overall customer support services, including reservations, and certain transaction-based expenses relating to third-party exchange service providers.

In our Vacation Ownership segment and Consolidated Property Owners’ Associations, we refer to these activities as “Resort Management and Other Services.”

We offer financing to qualified customers for the purchase of most types of our vacation ownership products.

We offer financing to qualified customers for the purchase of most types of our VOIs.

The typical financing agreement provides for monthly payments of principal and interest with the principal balance of the loan fully amortizing over the term of the related vacation ownership note receivable, which is generally ten to fifteen years.

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The amount of interest income earned in a period depends on the amount of outstanding vacation ownership notes receivable, which is impacted positively by the origination of new vacation ownership notes receivable and negatively by principal collections and defaults.

We calculate financing propensity as contract sales volume of financed contracts originated in the period divided by contract sales volume of all contracts originated in the period.

We calculate financing propensity as contract sales volume of

financed contracts originated in the period divided by contract sales volume of all contracts originated in the period.

We do not include resales contract sales in the financing propensity calculation.

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In contrast, for acquired vacation ownership notes receivable, we record changes to the reserve as an adjustment to Financing expenses on our Income Statements.

As a result of the unification of our Marriott-, Sheraton- and Westin- branded vacation ownership products under the Abound by Marriott Vacations program and stabilization of the default rates, in the third quarter of 2022, we combined and aligned our reserve methodology for vacation ownership notes receivable for our Marriott, Sheraton and Westin brands.

See Footnote 5 “Vacation Ownership Notes Receivable” to our Financial Statements for further information.

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We also recognize rental revenue from the utilization of plus points at redemption for rental stays at one of our resorts or other third-party offerings.

For rental revenues associated with vacation ownership products which we own and which are registered and held for sale, to the extent that the revenues from rental are less than costs, revenues are reported net in accordance with Accounting Standards Codification (“ASC”) Topic 978, “ Real Estate - Time-Sharing Activities ” (“ASC 978”).

For rental revenues associated with VOIs which we own and which are registered and held for sale, to the extent that the revenues from rental are less than costs, revenues are reported net of rental expenses in accordance with Accounting Standards Codification (“ASC”) Topic 978, “ Real Estate - Time-Sharing Activities ” (“ASC 978”).

The rental activity associated with discounted vacation packages requiring a tour (“preview stays”) is not included in transient rental metrics, and because the majority of these preview stays are sourced directly or indirectly from unsold inventory, the associated revenues and expenses are reported net in Marketing and sales expense.

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In addition, rental metrics may not correlate with rental revenues due to the requirement to report certain rental revenues net of rental expenses in accordance with ASC 978 (as discussed above).

Further, as our ability to rent certain inventory may be limited on a site-by-site basis, rental operations may not generate adequate rental revenues to cover associated costs.

Our Vacation Ownership segment units are either “full villas” or “lock-off” villas.

Lock-off villas are units that can be separated into a primary unit and a guest room.

Full villas are “non-lock-off” villas because they cannot be separated.

A “key” is the lowest increment for reporting occupancy statistics based upon the mix of non-lock-off and lock-off villas.

Lock-off villas represent two keys and non-lock-off villas represent one key.

The “transient keys” metric represents the blended mix of inventory available for rent and includes all of the combined inventory configurations available in our resort system.

Cost Reimbursements

Cost reimbursements include direct and indirect costs that are reimbursed to us by owners’ associations and customers under management contracts.

Cost reimbursements include direct and indirect costs that are reimbursed to us by owners’ associations and customers under management contracts, which costs are principally payroll-related costs at the locations where we employ the associates providing on-site services, costs associated with property refurbishments (including those where we act as the project manager), and insurance costs.

All costs reimbursed to us by owners’ associations and customers, with the exception of taxes assessed by a governmental authority, are reported on a gross basis.

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Performance Measures

We measure operating performance using the key metrics described below:

• Contract sales from the sale of vacation ownership products is considered to be an important operating measure because it reflects the pace of sales in our business.

Management uses the following key performance metrics to assess the Company’s operational efficiency and market competitiveness, identify trends, develop financial projections, and support strategic decision-making.

Management continuously monitors and analyzes these metrics to help ensure that the Company remains responsive to changing market conditions and aligned with our long-term growth objectives.

The definitions and methodologies of certain of these metrics may differ from those used by other companies, and as a result, these metrics may not be directly comparable to similarly titled measures reported by other companies.

• Contract sales from the sale of VOIs reflects the pace of sales in our business.

• Total contract sales include contract sales from the sale of vacation ownership products, including non-consolidated joint ventures.

• Consolidated contract sales exclude contract sales from the sale of vacation ownership products for non-consolidated joint ventures.

• Volume per guest (“VPG”) is calculated by dividing consolidated vacation ownership contract sales, excluding fractional sales, telesales, resales, and other sales that are not attributed to a sales tour (referred to as Tours , see below), by the number of tours in a given period.

We believe that VPG is valuable in evaluating the effectiveness of the sales process as it combines the impact of average contract price with the number of touring guests who make a purchase.

• Tours is the number of sales tours performed during the applicable period, and generally includes virtual and offsite sales tours, and excludes telesales.

We believe that Tours is a valuable metric because it represents the volume of touring guests.

• Development profit margin is calculated by dividing Development profit by revenues from the sale of vacation ownership products.

We refer to revenues from the sale of vacation ownership products less the cost of vacation ownership products and marketing and sales costs as Development profit.

We believe that Development profit margin is an important measure of the profitability of our development and subsequent marketing and sales of VOIs.

• Total active members is the number of Interval Network active members at the end of the applicable period.

We consider active members to be an important metric because it represents the population of owners eligible to book transactions using the Interval Network.

• Average revenue per member is calculated by dividing membership fee revenue, transaction revenue, rental revenue, and other member revenue for the Interval Network by the monthly weighted average number of Interval Network active members during the applicable period.

We believe this metric is valuable in measuring the overall engagement of our Interval Network active members.

• Segment financial results attributable to common stockholders represents revenues less expenses directly attributable to each applicable reportable business segment (Vacation Ownership and Exchange & Third-Party Management).

We consider this measure to be important in evaluating the performance of our reportable business segments.

• Volume per guest (“VPG”) is calculated as consolidated vacation ownership contract sales, excluding fractional sales, telesales, resales, and other sales that are not attributed to a sales tour (collectively, “Tours”) divided by the number of Tours conducted during the applicable period.

We believe that VPG is a key driver of profitability as it reflects both the average contract price and the effectiveness of converting touring guests into purchasers.

• Tours is defined as the number of sales tours conducted during the applicable period, including virtual and offsite sales tours and excludes telesales.

We view Tours as an important indicator of touring guest volume.

• Development profit margin is calculated as Development profit divided by revenues from the sale of vacation ownership products.

Development profit represents revenues from the sale of vacation ownership products, net of the cost of vacation ownership products and related marketing and sales costs.

We believe that Development profit margin is a key indicator of the profitability of our development activities and the effectiveness of its associated marketing and sales efforts.

• Total active members represents the number of active members of the Interval Network active members as of the end of the applicable period.

We consider this metric to be an important indicator of the size of the member base eligible to transact within the Interval Network.

• Average revenue per member is calculated by dividing membership fee revenue, transaction revenue, rental revenue, and other member revenue generated by the Interval Network by the monthly weighted average number of active

members of the Interval Network during the applicable period.

We believe this metric is a meaningful indicator of member engagement.

• Segment financial results attributable to common stockholders reflects revenues less expenses that are directly attributable to each respective reportable business segment (Vacation Ownership and Exchange & Third-Party Management).

We believe this measure provides meaningful insight into the operating performance of our reportable business segments.

See Footnote 19 “Business Segments” to our Financial Statements for further information about our reportable business segments.

• Adjusted EBITDA margin represents Adjusted EBITDA divided by the Company’s total revenues less cost reimbursements revenues.

• Segment Adjusted EBITDA margin represents Segment Adjusted EBITDA divided by the applicable segment’s total revenues less cost reimbursements revenues.

• Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by the Company’s total revenues less cost reimbursements revenues.

• Segment Adjusted EBITDA margin is calculated as Segment Adjusted EBITDA divided by the respective segment’s total revenues less cost reimbursements revenues.

NM = Not meaningful.

Management Priorities

Our management priorities for 2026 are centered on driving stronger profitability and improving cash flow.

We are focused on reshaping the quality and composition of our tours, tightening our cost structure, and refining our global development strategy.

We expect that delivering higher‑quality tours via various initiatives will increase VPGs while reducing default rates on newly originated vacation ownership notes receivable.

For example, we are using FICO scores to pre-qualify prospective purchasers and focusing on increasing in-house capture rates, which has historically been one of our highest VPG channels.

Additional priorities include reducing overhead, focusing on marketing and sales talent, delaying modernization projects to manage cash flow, monetizing certain non-core assets on our balance sheet, and managing maintenance fee increases for each of our vacation ownership products.

Asia Pacific Strategy Change

A key element of our revised strategy relates to our Asia Pacific business, where we have experienced lower returns than expected, partially due to higher defaults that are primarily driven by customers from newer source markets.

To address these dynamics, we are scaling back growth expectations and right‑sizing our business in the region.

This includes reducing tours for first‑time buyers in select countries, reducing headcount in the region, deferring the purchase of the next phase of our resort in Khao Lak, Thailand, and canceling a purchase commitment for inventory in Bali.

Collectively, these actions are designed to concentrate our efforts on markets with the greatest potential to drive profitability and cash flow and resulted in Restructuring expense in our Vacation Ownership segment.

We also recorded a non-cash impairment for vacation ownership units in Khao Lak, Thailand primarily attributed to the elongation of the pace of sales and changes in our marketing approach.

Development Strategy Change

As part of our broader financial strategic review, we conducted a comprehensive review to assess the strategic alignment of inventory and property and equipment within our North America vacation ownership business.

This review focused on assessing inventory needs in light of our current inventory position and identifying opportunities to monetize non-core assets.

The outcome of this review represented an indicator of impairment for certain assets.

As a result of our impairment analysis, we recorded a non‑cash impairment related to assets associated with future phases of our existing resorts that we no longer plan to further develop.

The carrying values of the assets associated with these resorts exceeded their estimated fair values because the carrying values included historical allocations of common infrastructure costs incurred when we built the resorts.

In addition, we recorded a non-cash impairment related to certain property and equipment identified for disposition in our Vacation Ownership segment.

We expect to generate between $250 million and $300 million of net cash proceeds over a two year period from the disposition of certain non-core property and equipment and other assets, including $50 million from the disposition of the Cancun hotel in January 2026.

CONSOLIDATED RESULTS

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Financing 150 146 113

Royalty fee 113 114 117

General and administrative (1)

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Litigation charges (1)

Modernization (1)

Restructuring (1)

Royalty fee 114 117 114

Impairment 577 30 32

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TOTAL EXPENSES 5,209 4,477 4,191

(Losses) gains and other (expense) income, net (1) 47 40

Gains (losses) and other income (expense), net 47 (1) 47

Interest expense, net (169) (162) (145)

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Other — (3) (3)

INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 306 398 582

(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS (299) 306 398

Provision for income taxes (8) (89) (146)

NET INCOME 217 252 391

Net loss attributable to noncontrolling interests 1 2 —

NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS $ 218 $ 254 $ 391

NET (LOSS) INCOME (307) 217 252

Net (income) loss attributable to noncontrolling interests (1) 1 2

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (308) $ 218 $ 254

(1) Prior year amounts have been reclassified to conform with our current year presentation.

Operating Statistics

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Vacation Ownership

Total contract sales $ 1,829 $ 1,800 $ 1,874 $ 29 2%

Consolidated contract sales $ 1,762 $ 1,813 $ 1,772 $ (51) (3%)

Joint venture contract sales $ 16 $ 28 $ 37 $ (12) (43%)

VPG $ 3,794 $ 3,911 $ 4,088 $ (117) (3%)

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Exchange & Third-Party Management

Total active members at end of year (000's) 1,546 1,564 1,566 (18) (1%)

Total active members at end of period (000's) 1,507 1,546 1,564 (39) (2%)

Average revenue per member $ 150.51 $ 154.34 $ 156.65 $ (3.83) (2%)

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Earnings Before Interest Expense, Taxes, Depreciation and Amortization (“EBITDA”) and Adjusted EBITDA

EBITDA, a financial measure that is not prescribed by GAAP, is defined as earnings, or net income attributable to common stockholders, before interest expense, net (excluding consumer financing interest expense associated with term securitization transactions), income taxes, depreciation and amortization.

Adjusted EBITDA reflects additional adjustments for certain items, and excludes share-based compensation expense to address considerable variability among companies in recording compensation expense because companies use share-based payment awards differently, both in the type and quantity of awards granted.

EBITDA, a financial measure that is not prescribed by GAAP, is defined as earnings, or net income or loss attributable to common stockholders, before interest expense, net (excluding consumer financing interest expense associated with term securitization transactions), income taxes, depreciation and amortization.

Adjusted EBITDA reflects additional adjustments for certain items, and excludes share-based compensation expense and amortization of cloud computing software implementation costs.

Share-based compensation expense is excluded to address considerable variability among companies in recording compensation expense because companies use share-based payment awards differently, both in the type and quantity of awards granted.

During the first quarter of 2025, we began excluding amortization of cloud computing software implementation costs, which are not included in depreciation and amortization, from Adjusted EBITDA for comparability purposes to address the considerable variability among companies in the utilization of productive assets, and have reclassified prior year amounts to conform with our current year presentation.

For purposes of our EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin calculations, we do not adjust for consumer financing interest expense associated with term securitization transactions because we consider it to be an operating expense of our business.

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As a result, effective tax rates and provisions for income taxes can vary considerably among companies.

EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin also exclude depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets.

EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin also exclude depreciation and amortization as well as amortization of cloud computing software implementation costs because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating or amortizing productive assets.

These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.

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In addition, other companies in our industry may calculate EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin differently than we do or may not calculate them at all, limiting their usefulness as comparative measures.

The table below shows our EBITDA and Adjusted EBITDA calculation and reconciles these measures with net income attributable to common stockholders, which is the most directly comparable GAAP financial measure.

Additionally, during 2025, we reclassified $6 million of certain amounts related to ongoing litigation from General and administrative expense to Litigation charges in order to conform our 2024 results with our current year presentation.

Commencing in 2026, interest expense associated with our Warehouse Credit Facility will be included as a component of Consumer financing interest expense within Financing expense.

Interest expense on our Warehouse Credit Facility was $13 million and $10 million for the years ended December 31, 2025 and December 31, 2024, respectively.

The table below shows our EBITDA and Adjusted EBITDA calculation and reconciles these measures with net income or loss attributable to common stockholders, which is the most directly comparable GAAP financial measure.

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

Net income attributable to common stockholders $ 218 $ 254 $ 391 $ (36) (14%)

Net (loss) income attributable to common stockholders

$ (308) $ 218 $ 254 $ (526) NM

Interest expense, net 169 162 145 7 4%

Provision for income taxes 89 146 191 (57) (39%)

Provision for income taxes 8 89 146 (81) NM

Depreciation and amortization 149 146 135 3 3%

EBITDA 615 680 832 (65) (10%)

EBITDA 18 615 680 (597) NM

Share-based compensation expense 38 33 31 5 15%

Certain items 79 50 95 29 NM

Amortization of cloud computing software implementation costs (1)(2)

Certain items (1)

689 85 50 604 NM

Adjusted EBITDA (1)

Adjusted EBITDA Margin 22.2% 24.0% 29.4% (1.8 pts)

$ 751 $ 736 $ 761 $ 15 2%

Adjusted EBITDA Margin (1)

22.5% 22.5% 24.0% 0.0 pts

(1) Prior year amounts have been reclassified to conform with our current year presentation.

(2) During the first quarter of 2025, we began excluding Amortization of cloud computing software implementation costs, which are not included in Depreciation and amortization, from Adjusted EBITDA, and have reclassified prior year amounts to conform with our current year presentation.

The table below details the components of Certain items for fiscal years 2025 and 2024.

($ in millions) 2025 2024

ILG integration $ — $ 15

Welk acquisition and integration 18 22

Transaction and integration costs 18 37

Purchase accounting adjustments 1 8

Litigation charges 17 13

Restructuring charges 10 6

Impairment charges 30 32

Early redemption of senior secured notes — 10

Gain on disposition of hotel, land, and other $ — $ (8)

Foreign currency translation loss (gain) 13 (6)

Foreign currency translation (gain) loss (22) 13

Insurance proceeds (16) (5)

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Change in estimates relating to pre-acquisition contingencies (2) (4)

Losses (gains) and other expense (income), net 1 (47)

(Gains) losses and other (income) expense, net (47) 1

Transaction and integration costs — 18

Purchase accounting adjustments — 1

Litigation charges (1)

Modernization (1)

Restructuring (1)

Impairment 577 30

Total Certain items (1)

During the third quarter of 2023 and the second quarter of 2024, we discontinued classifying costs associated with the continued integration of ILG and Welk, respectively, in Transaction and integration costs.

Further integration costs incurred after these periods are reflected in the operating results of each of our segments and/or General and administrative expenses.

(1) Prior year amounts have been reclassified to conform with our current year presentation.

Segment Adjusted EBITDA

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Vacation Ownership (1)

$ 868 $ 848 $ 883 $ 20 2%

Exchange & Third-Party Management 91 102 130 (11) (11%)

Segment Adjusted EBITDA (1)

959 950 1,013 9 1%

General and administrative (1)

(242) (237) (273) (5) (2%)

Other 34 23 21 11 43%

Adjusted EBITDA (1)

$ 751 $ 736 $ 761 $ 15 2%

(1) Prior year amounts have been reclassified to conform with our current year presentation.

The following tables present segment financial results attributable to common stockholders reconciled to segment Adjusted EBITDA.

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($ in millions) 2025 2024 2023 Change

Segment financial results $ 703 $ 777 $ 961 $ (74) (10%)

Segment financial results $ 345 $ 703 $ 777 $ (358) NM

Depreciation and amortization 106 100 93 6 7%

Share-based compensation expense 9 8 8 1 11%

Amortization of cloud computing amortization implementation costs (1)

Certain items 403 34 5 369 NM

Segment Adjusted EBITDA (1)

$ 868 $ 848 $ 883 $ 20 2%

Segment Adjusted EBITDA Margin (1)

28.3% 28.2% 30.7% 0.1 pts

(1) Prior year amounts have been reclassified to conform with our current year presentation.

The table below details the components of Certain items for the Vacation Ownership segment financial results for fiscal years 2025 and 2024.

($ in millions) 2025 2024

Purchase accounting adjustments $ 1 $ 8

Litigation charges 18 12

Restructuring charges 1 —

Impairment charges 28 12

Gain on disposition of hotel, land, and other $ — $ (7)

Insurance proceeds (15) (5)

Change in indemnification asset — (9)

Change in estimates relating to pre-acquisition contingencies (2) (4)

Gains and other income, net (18) (16)

Purchase accounting adjustments — 1

Litigation charges 11 18

Restructuring 15 1

Impairment 395 28

Total Certain items $ 403 $ 34

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($ in millions) 2025 2024 2023 Change

Segment financial results $ 69 $ 93 $ 132 $ (24) (26%)

Segment financial results $ (116) $ 69 $ 93 $ (185) NM

Depreciation and amortization 24 28 31 (4) (14%)

Share-based compensation expense 2 2 2 — NM

Share-based compensation expense 2 2 2 — 11%

Certain items 181 3 4 178 NM

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($ in millions) 2025 2024

Litigation charges $ — $ 1

Restructuring charges 1 —

Impairment charges 2 4

Gain on disposition of hotel, land, and other (1) (1)

Foreign currency translation loss 1 —

Gains and other income, net $ (1) $ —

Restructuring — 1

Impairment 182 2

Total Certain items $ 181 $ 3

16 unchanged sentences

Financing 150 146 113

Royalty fee 113 114 117

Depreciation and amortization 106 100 93

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Restructuring 15 1 —

Royalty fee 114 117 114

Impairment 395 28 12

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Gains and other income, net 18 16 29

Transaction and integration costs — — (3)

Other — (3) (3)

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Consolidated contract sales $ 1,762 $ 1,813 $ 1,772 $ (51) (3%)

$ 1,813 $ 1,772 $ 1,837 $ 41 2%

Joint venture contract sales 16 16 28 — (1%)

Total contract sales 1,778 1,829 1,800 (51) (3%)

Less resales contract sales (38) (42) (40) 4

Less joint venture contract sales (16) (28) (37) 12

Resales contract sales (29) (38) (42) 9

Joint venture contract sales (16) (16) (28) —

Consolidated contract sales, net of resales 1,733 1,775 1,730 (42) (2%)

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2025 Compared to 2024

Contract sales increased in 2024 due to a 7% increase in tours, partially offset by a 4% decline in VPG.

The decrease in VPG was due to a larger percentage mix of international and North America first time buyer tours, both of which carry a lower VPG than existing owner tours.

While existing owner VPG was in line with the prior year, first time buyer VPG declined 9%.

In the third quarter of 2023, we increased our vacation ownership notes receivable reserve to reflect then-current trends in delinquencies and default rates.

We estimated the increase in our sales reserve primarily using information from a historical period of increased defaults.

The $59 million additional reserve recorded in 2023 was the result of an adjustment to our future default rate estimate to reflect then-current macroeconomic conditions, including inflation outpacing wage growth, continuing high interest rates, mixed economic indicators and increased global insecurity.

During the second quarter of 2024, we increased our sales reserve by $70 million to reflect increases in expected cumulative loss rates for our vacation ownership notes receivable originated during 2021-2024.

Consistent with our analysis in the third quarter of 2023, we considered the cumulative impact of inflation and mixed economic environment on delinquencies and default rates.

We believed the related impact of higher than historical year-over-year increases in maintenance fees for 2023 and 2024 would continue to drive elevated delinquencies and defaults.

As expected, maintenance fee increases for our points-based products for 2025, which were approved by the relevant property owners’ association, returned to levels consistent with historical experience.

We have increased our sales reserve rate to reflect higher expected cumulative losses on new originations and do not expect to lower the sales reserve rate until we have sufficient evidence of improvement in delinquency and default rates.

The increase in Sale of vacation ownership products was primarily due to a decrease in our sales reserve reflecting the $70 million sales reserve adjustment (the “additional sales reserve”) recorded in the second quarter of 2024, which did not recur in 2025.

Lower contract sales were partially offset by higher revenue reportability and financing propensity in 2025.

First time buyer contract sales were flat on 1% higher tours.

Owner contract sales declined 4% on lower VPG and tours.

Excluding the impact of the additional sales reserve recorded in the second quarter of 2024, our sales reserve as a percent of contract sales in 2025 is approximately 110 basis points higher than the prior year, reflecting our expectation that future defaults will be higher than those experienced prior to 2023.

While our delinquency rates at December 31, 2025 have declined approximately 100 basis points compared to December 31, 2024, we do not expect to lower the sales reserve for new originations until we have sufficient, sustained evidence of continued improvement in delinquency and default rates.

Development Profit

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2025 Compared to 2024

The decrease in Development profit was due to the following:

• lower sales of vacation ownership products due to the increase in sales reserve discussed above;

The increase in Development profit was due to the following:

• higher Sale of vacation ownership products (discussed above);

• lower Cost of vacation ownership products due to the $13 million favorable impact of the additional sales reserve in 2024 partially offset by the sale of higher average cost inventory.

These were partially offset by:

• higher marketing and sales costs due to:

• higher preview costs attributed to a $26 million increase in cost of occupancy and $4 million for higher tours volume;

• $28 million increase in tour generation costs;

• $19 million of higher compensation due to inflation and higher contract sales;

• $19 million of higher information technology and other operating costs.

These changes were partially offset by:

• lower cost of vacation ownership products attributed to the sale of lower average cost inventory, including product cost true-up activity, partially offset by higher contract sales.

• $10 million of higher costs for occupancy used for previews;

• $8 million of higher marketing and other costs;

• $6 million of higher salaries, wages and benefits for sales executives, including variable compensation.

Excluding the favorable impact of the additional sales reserve in 2024, both Cost of vacation ownership products and Cost of vacation ownership products as a percentage of sales were flat.

Excluding the impact of the additional sales reserve in 2024, Development profit decreased $49 million and Development profit margin decreased approximately 240 basis points in 2025.

Resort Management and Other Services Revenues, Expenses and Profit

12 unchanged sentences

2025 Compared to 2024

The increase in Resort management and other services revenues reflects higher management fees, higher ancillary revenues and higher club dues.

The increase in Resort management and other services expenses reflects an increase in ancillary expenses of $15 million due to increased volumes sold and operating costs, and an increase in customer services and exchange company expenses of $8 million due to wages, benefits, and other operating cost increases.

The increase in Resort management and other services profit reflects $16 million of higher management and exchange profit reflecting continued growth in revenues and operating efficiencies, and $7 million of higher ancillary profit.

Rental Revenues, Expenses and Margin

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2025 Compared to 2024

Rental profit, excluding profit from owned hotels, increased due to:

• $43 million of higher plus points revenue attributed to enhanced sales incentive programs put in place during COVID, which increased the amount of plus points issued and lengthened the use period;

Rental profit declined due to:

• $23 million of lower plus point revenue resulting from the non-recurring impact of sales incentive programs put in place during the COVID pandemic, which increased the amount of plus points issued and lengthened the use period through the end of 2024, resulting in higher non-recurring revenues in 2024;

• $13 million of higher unsold maintenance fees associated with developer-owned inventory;

• $17 million of higher marketing, variable and other costs;

• $2 million of increased costs due to higher owner utilization of third-party vacation offerings.

These amounts are partially offset by:

• $16 million increase in transient rental revenues;

• $10 million increase in costs allocated to marketing and sales expense for occupancy used for previews.

These changes were partially offset by:

• $17 million of increased costs associated with higher owner utilization of third-party vacation and other offerings;

• $12 million of decreased profit due to a lower average transient rate on higher keys rented and higher tidy and variable costs.

Rental profit for our owned hotels increased $2 million.

We expect rental profit to decline in 2025 due to a higher mix of keys in lower ADR markets, lower plus point revenue due the expiration of enhanced sales incentives programs put in place during COVID, additional preview usage and higher costs associated with unsold maintenance fees.

Rental revenues and Rental expenses are both $17 million higher due to the year over year change in the amount reclassified for costs in excess of rental revenues for developer-owned inventory which is registered and held for sale.

Financing Revenues, Expenses and Margin

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2025 Compared to 2024

The increase in Financing revenues reflects $20 million of higher interest income as a result of a higher average vacation ownership notes receivable balance and $1 million of higher late and service fees, partially offset by $1 million of higher plus point financing incentive costs (recorded as a reduction of interest income).

The increase in consumer financing interest expense is attributable to the higher average securitized debt at a higher average interest rate for our more recent term securitization transactions.

We expect our average interest rate to continue to increase as the current interest rate environment for new securitization transactions is higher than the average interest rate on our existing securitized debt.

We do not adjust interest rates on consumer financing offerings at the same pace as, or in lock-step with, broader market interest rates.

We expect our financing profit to remain flat in 2025.

• Financing revenues reflect higher interest income as a result of a higher average notes receivable balance.

• The increase in financing expense is primarily attributed to higher credit card fees, partially offset by lower operating costs, including those resulting from our cost savings initiatives implemented in the third quarter of 2025.

Litigation Charges

3 unchanged sentences

2025 Compared to 2024

During 2024 and 2023, litigation charges relate primarily to a land disposition in the U.S.

and certain resorts in Europe.

During 2025 and 2024, litigation charges relate primarily to certain resorts in Europe, as well as a land disposition in the U.S.

Restructuring Charges

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

Restructuring $ 15 $ 1 $ — $ 14 NM

2025 Compared to 2024

During 2025, we recorded $15 million of restructuring costs, all of which related to the strategy change in our Asia Pacific business, consisting of $10 million for the cancellation of a purchase commitment for 26 vacation ownership units in Bali ($8 million related to the write-off of progress payments and $2 million for the contract termination fee) and $5 million of severance.

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

Impairment $ 395 $ 28 $ 12 $ 367 NM

During 2024, we recorded a non-cash impairment charge of $28 million related to Legacy-Welk inventory.

The impairment charge reflects an elongated pace of sales at a higher marketing and selling cost than that estimated in purchase accounting.

During 2023, we recorded non-cash impairment charges of $8 million related to our investment in a joint venture, $2 million related to an ancillary operation in Europe, and $2 million related to an owned hotel.

During 2025, we recorded non-cash impairment charges of $395 million related to our development strategy change including:

• $160 million to write down the basis of certain non-core Property and equipment and Other assets identified for disposition to their estimated fair values;

• $131 million related to decisions to forego build out of future phases of existing resorts primarily attributed to the fact that the book values of these assets include the historical allocations of common costs incurred when we built the infrastructure of these resorts;

• $75 million to write down the value of vacation ownership interests related to Legacy-Welk reflecting a further elongated pace of sales at a higher marketing and selling cost as the Hyatt-branded vacation ownership business continues to underperform expectations;

• $27 million for the impairment of vacation ownership units in Khao Lak, Thailand classified in Inventory due to the change in strategy for the in Asia Pacific region which elongated the pace of sales and changes in our marketing approach;

• $2 million for the impairment of inventory in an equity method investment.

During 2024, we recorded non-cash impairment charges of $28 million related to Legacy-Welk inventory.

The impairment charge reflects an elongated pace of sales at a higher marketing and selling cost than the estimates used in purchase accounting when we acquired the inventory.

Gains and Other Income

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Gains and other income, net $ 18 $ 16 $ 29 $ 2 NM

During 2024, we recorded $6 million of gains on the disposition of excess real estate, $5 million related to the receipt of business interruption insurance proceeds, and a $4 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition.

During 2023, we recorded a $9 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition, $9 million related to the receipt of business interruption and property damage insurance proceeds, $7 million of gains on the disposition of excess real estate, and $4 million of gains associated with the earn out of additional proceeds from the 2019 disposition of a land parcel in Cancun, Mexico.

During 2025 we benefited from $15 million of proceeds from service interruption insurance relating to the Maui wildfires, a $2 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition, and $1 million of other miscellaneous gains.

During 2024 we benefited from $6 million of gains on the disposition of excess real estate, $5 million related to the receipt of business interruption insurance proceeds, a $4 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition, and $1 million of other miscellaneous gains.

EXCHANGE & THIRD-PARTY MANAGEMENT

Our Exchange & Third-Party Management segment is comprised of the Interval International and Aqua-Aston businesses.

Results below include VRI Americas for the period prior to its disposition in the second quarter of 2022.

($ in millions) 2025 2024 2023

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2025 Compared to 2024

Interval International management and exchange revenues declined $11 million, or 6% , as a result of 7% lower exchange transaction volume, partially offset by a 4% increase in average exchange fees.

The decrease in management and exchange revenue also reflects a $13 million decline in Aqua-Aston management revenues resulting from changes in demand in Maui, along with a decline in available nights across the portfolio.

The decrease in management and exchange profit was primarily attributed to lower revenues and higher information technology expenses.

• Interval International management and exchange revenues declined $6 million primarily due to 9% lower exchange transaction volume, partially offset by a 6% increase in average exchange fees.

• Management and exchange revenue reflects a $4 million decline in Aqua-Aston management revenues resulting from fewer available nights for rent and a lower average daily rate in the Hawaii market.

• Management and exchange revenue declined $2 million as a result of the sale of an immaterial subsidiary in the second quarter of 2024.

• The decrease in management and exchange expenses was primarily attributable to lower wages and benefits and other costs.

Rental Revenues

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2025 Compared to 2024

Results reflect a 6% increase in average fees per transaction and lower inventory acquisition costs, partially offset by an 8% decrease in transaction volume.

The decrease in rental revenues reflects a 15% decrease in transaction volume, partially offset by a 9% increase in average fees per transaction.

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

Impairment $ 182 $ 2 $ 4 $ 180 NM

2025 Compared to 2024

In 2025, we recorded a non-cash impairment of $182 million primarily to write down the value of our goodwill ($159 million) as a result of (i) the change in expected future operating results based on a sustained decline in operating performance in comparison to prior expectations;

and (ii) the impact of market factors, including a decline in our stock price and market capitalization.

In addition, we recorded a $21 million non-cash impairment to write down the value of trade names which was primarily attributed to the decline in estimated future revenues of each of the related businesses and a $2 million impairment related to an operating lease and related assets.

See Footnote 10 “Goodwill” and Footnote 11 “Intangible Assets” to our Financial Statements for additional information.

CORPORATE AND OTHER

Corporate and Other consists of results that are not allocable to our segments, including company-wide general and administrative costs, corporate interest expense, net, transaction and integration costs, and income taxes.

Corporate and Other consists of results that are not allocable to our segments, including company-wide general and administrative costs, corporate interest expense, transaction and integration costs, and income taxes.

In addition, Corporate and Other includes the revenues and expenses from the Consolidated Property Owners’ Associations.

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Litigation charges (1)

Modernization (1)

Restructuring (1)

2 unchanged sentences

TOTAL EXPENSES 400 275 304

(Losses) gains and other (expense) income, net (17) 17 (12)

Gains (losses) and other income (expense), net 28 (17) 17

Interest expense, net (169) (162) (145)

Transaction and integration costs — (18) (37)

FINANCIAL RESULTS BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS (466) (472) (511)

Provision for income taxes (89) (146) (191)

Net loss attributable to noncontrolling interests 1 2 —

FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (554) $ (616) $ (702)

Consolidated Property Owners’ Associations

The following table illustrates the impact of certain Consolidated Property Owners’ Associations under the relevant accounting guidance and the changes attributed to the deconsolidation of certain individual Consolidated Property Owners’ Associations.

($ in millions) 2024 2023 2022

Resort management and other services $ 49 $ 39 $ 64

Cost reimbursements (43) (42) (44)

TOTAL REVENUES 6 (3) 20

Resort management and other services 67 54 84

Rental (17) (14) (18)

Cost reimbursements (43) (42) (44)

TOTAL EXPENSES 7 (2) 22

Losses and other expense, net — — (3)

Interest expense, net 1 1 —

Other (1) — —

FINANCIAL RESULTS BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS (528) (466) (472)

Provision for income taxes (8) (89) (146)

Net loss attributable to noncontrolling interests 1 2 —

Net (income) loss attributable to noncontrolling interests (1) 1 2

FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (537) $ (554) $ (616)

$ — $ 1 $ (6)

(1) Prior year amounts have been reclassified to conform with our current year presentation.

General and Administrative

3 unchanged sentences

2025 Compared to 2024

The decrease in General and administrative expense is primarily due to one-time information technology expenses incurred in 2023 and lower consulting and compliance related expenses, partially offset by higher variable compensation expense and higher operating costs.

We expect General and administrative expenses to increase in the near term due to the continued impact of increased wages and variable compensation expense and additional investment in upgrading, maintaining, and implementing new technology, including costs associated with our continued transition to software as a service, which are recorded as a component of General and administrative expense as opposed to Depreciation expense.

Restructuring

Fiscal Years 2024 vs.

($ in millions) 2024 2023 2022 Change

Restructuring $ 8 $ 6 $ — $ 2 NM

In November 2024, we announced the creation of a Strategic Business Operations office focused on accelerating our growth and driving operating efficiencies in all areas of our business while increasing organizational agility.

We intend to modernize and optimize our processes and systems, including through advanced technology and automation, while focusing on efforts to increase sales efficiency and inventory optimization while capturing significant savings from initiatives related to procurement and corporate overhead.

We believe that we can drive $150 million to $200 million of run rate benefits from these initiatives by the end of 2026, with half coming from cost savings and efficiencies with the balance from accelerating revenue growth.

We expect to incur one-time costs related to these initiatives of approximately $100 million in each of 2025 and 2026 to enhance our customer platforms, products and services to achieve these benefits.

We also expect additional savings that will benefit our owners’ maintenance fees.

During 2024, we incurred $4 million of severance costs and $4 million of other costs associated with these efforts.

During 2023, we realigned our management structure, resulting in severance costs associated with the elimination of certain positions.

The increase in General and administrative expenses is attributed to $27 million of higher wages, benefits and variable compensation and $6 million of severance for our former chief executive officer, partially offset by $8 million of net savings from outsourcing certain finance and accounting and human resources functions, $7 million of lower insurance, $4 million of lower consulting costs and $9 million of other individually insignificant cost reductions.

Litigation Charges

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

Impairment $ — $ 16 $ — $ (16) NM

During 2023, upon our relocation to our new corporate headquarters, we recorded a non-cash impairment of a right-of-use asset related to operating leases for our legacy corporate headquarters located in Orlando, Florida, as we did not expect proceeds from subleasing these spaces to exceed our future obligations under the operating leases.

(Losses) Gains and Other (Expense) Income

Litigation charges (1)

$ 6 $ 5 $ — $ 1 3%

(1) Prior year amounts have been reclassified to conform with our current year presentation.

2025 Compared to 2024

Litigation charges during 2025 and 2024 relate to a dispute with a service provider.

Modernization Charges

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

(Losses) gains and other (expense) income, net $ (17) $ 17 $ (12) $ (34) NM

In 2024, we recorded $12 million of foreign currency translation losses and $5 million of tax related adjustments to the receivable from Marriott International for indemnified tax matters.

In 2023, we recorded a $22 million increase to our receivable from Marriott International for indemnified income tax matters (the offsetting accrual is included in the Provision for income taxes line) and $6 million of foreign currency translation gains, partially offset by a $10 million expense attributed to the redemption premium and write-off of unamortized debt issuance costs in connection with the early redemption of our 6.125% Senior Secured Notes due 2025 (“2025 Notes”).

Interest Expense

Modernization (1)

$ 122 $ 4 $ — $ 118 NM

(1) Prior year amounts have been reclassified to conform with our current year presentation.

2025 Compared to 2024

The Strategic Business Operations office was created to modernize and optimize our processes and systems, including through advanced technology and automation;

increase sales efficiency and inventory optimization;

and capture significant savings from initiatives related to procurement and corporate overhead.

2025 Modernization charges related to:

• $87 million of advisory services;

• $18 million for the partial outsourcing of corporate overhead functions;

• $12 million for technology;

• $5 million related to other initiatives.

In the third quarter of 2025, we outsourced a portion of our human resources and finance and accounting functions to third-party service providers, which we expect will result in annual cost savings of approximately $20 million that will be reflected in multiple expense lines on our income statements.

We expect to incur non-recurring expenses of approximately $100 million in 2026 related to these modernization initiatives.

Gains (Losses) and Other Income (Expense)

Fiscal Years 2025 vs.

($ in millions) 2025 2024 2023 Change

Interest expense, net $ (162) $ (145) $ (118) $ (17) (12%)

2024 Compared to 2023

The increase in Interest expense, net is attributed to higher variable interest expense and changes in outstanding borrowings during the comparative periods.

Gains (losses) and other income (expense), net $ 28 $ (17) $ 17 $ 45 NM

In 2025, we recorded $22 million of foreign currency translation gains, a $4 million increase in the receivable from Marriott International for indemnified tax matters, $1 million of insurance proceeds, and $1 million of other gains.

In 2024, we recorded $12 million of foreign currency translation losses and a $5 million reduction in the receivable from Marriott International for indemnified tax matters.

($ in millions) 2025 2024 2023

3 unchanged sentences

2025 Compared to 2024

The change in our income tax expense is attributable to lower income before income taxes and noncontrolling interests $23 million and benefits from changes in uncertain tax benefits and our valuation allowance ($78 million).

These decreases were partially offset by certain state, foreign and permanent differences which were unfavorable to prior periods ($44 million), of which $20 million related to the removal of our permanent reinvestment assertion for earnings in certain non-U.S.

The decrease in income tax expense for 2025 primarily reflects losses before income taxes and noncontrolling interests, as well as the establishment of valuation allowances on certain deferred tax assets.

The decrease was further driven by

the absence of the tax expense recognized in 2024 related to the removal of our permanent reinvestment assertion for earnings in certain non-U.S.

entities, partially offset by tax benefits associated with 2025 restructuring activity.

These decreases were partially offset by the impact of certain state and federal permanent differences and the absence of a benefit recognized in 2024 related to changes in uncertain tax positions.

Timing of Estimated Tax Payments

As part of the federal tax relief provided by the Internal Revenue Service for businesses in areas of Florida affected by hurricanes during 2024, we were permitted to defer certain federal income tax payments without incurring interest or penalties.

As a result, we deferred $38 million of estimated tax payments from 2024 to 2025.

Similarly, in 2024, under comparable relief measures related to hurricanes in 2023, we deferred $32 million of estimated tax payments from 2023 to 2024.

In addition, in 2023, under similar circumstances, we deferred $45 million of estimated tax payments from 2022 to 2023.

None of our 2025 estimated tax payments were deferred into 2026.

Refer to Footnote 4 “Income Taxes” for additional information.

In December 2021, the Organization for Economic Co-operation and Development (“OECD”) released model rules introducing a 15% global minimum tax rate for large multinational corporations (“Pillar 2”).

Certain countries in which we operate have enacted legislation consistent with the OECD model rules effective beginning in 2024.

We considered the applicable tax laws enacted in relevant jurisdictions and concluded there is not a material effect on our tax provision for the year ended December 31, 2024.

We will continue to evaluate the impact of additional Pillar Two legislative changes on future reporting periods.

Consolidated Property Owners’ Associations

The following table illustrates the impact of certain Consolidated Property Owners’ Associations under the relevant accounting guidance.

($ in millions) 2025 2024 2023

Resort management and other services $ 57 $ 49 $ 39

Cost reimbursements (43) (43) (42)

TOTAL REVENUES 14 6 (3)

Resort management and other services 68 67 54

Rental (14) (17) (14)

Cost reimbursements (43) (43) (42)

TOTAL EXPENSES 11 7 (2)

Interest expense, net — 1 1

FINANCIAL RESULTS BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 3 — —

Provision for income taxes (1) (1) (1)

Net (income) loss attributable to noncontrolling interests (1) 1 2

FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS

Liquidity and Capital Resources

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We continuously monitor the capital markets to evaluate the effect that changes in market conditions may have on our ability to fund our liquidity needs.

At December 31, 2024, our corporate debt, net of cash and equivalents, to Adjusted EBITDA ratio was 4.0, above our targeted range of 2.5 to 3.0, and we remain focused on reducing this ratio over time.

During the second quarter of 2024, we amended the Corporate Credit Facility to provide for a new $800 million term loan facility that is scheduled to mature on April 1, 2031 (the “New Term Loan”).

The proceeds of the New Term Loan were used to refinance in full the Term Loan, which had a balance of $784 million as of March 31, 2024 and was scheduled to mature on August 31, 2025.

We have no material principal payment obligations on our debt prior to 2026.

At December 31, 2025, our corporate debt, net of cash and equivalents, to Adjusted EBITDA ratio was 4.2, a manageable leverage level, and we remain focused on reducing this ratio over time.

Subsequent to the end of 2025, we used the proceeds from the 2033 Notes to repay our 2026 Convertible Notes upon maturity.

See Footnote 15 “Debt” to our Financial Statements for further information related to maturities of our debt.

18 unchanged sentences

Those loans may later be transferred to term securitization transactions in the ABS market, which typically occur twice a year.

During 2024, we amended certain agreements associated with our Warehouse Credit Facility, which extended the revolving period from May 31, 2025 to June 11, 2026.

At December 31, 2024, we had $124 million of borrowings outstanding on our Warehouse Credit Facility.

During 2025, we amended certain agreements associated with our Warehouse Credit Facility, which among other things extended the revolving period from June 11, 2026 to June 11, 2027.

At December 31, 2025, no borrowings were outstanding on our Warehouse Credit Facility.

As of December 31, 2025, $176 million of gross vacation ownership notes receivable were eligible for securitization.

See Footnote 14 “Securitized Debt” and Footnote 18 “Variable Interest Entities” for further information on these facilities.

Revolving Corporate Credit Facility

Our Revolving Corporate Credit Facility, which expires on March 31, 2027, provides for up to $750 million of aggregate borrowings for general corporate needs, including working capital, capital expenditures, letters of credit, and acquisitions.

At December 31, 2024, $125 million of borrowings and $18 million of letters of credit were outstanding under our Revolving Corporate Credit Facility.

See Footnote 16 “Debt” to our Financial Statements for more information on interest rates pertaining to this facility.

Issuance of Senior Unsecured Notes

During the third quarter of 2025, we issued the 2033 Notes with an aggregate principal amount of $575 million and we received net proceeds of $567 million from the offering, after deducting the underwriting fees and transaction expenses.

We used the net proceeds to repay our 2026 Convertible Notes due in January 2026.

Corporate Credit Facility

During 2025, we entered into an amendment to the Corporate Credit Facility (the “Amendment”), which, among other things, increased the borrowing capacity on our Revolving Corporate Credit Facility from $750 million to $800 million of aggregate borrowings for general corporate needs, including working capital, capital expenditures, letters of credit, and acquisitions.

The Amendment also extended the termination date from March 31, 2027 to March 24, 2030, reduced

certain fees and interest costs, and increased the letter of credit sub-facility of the Revolving Corporate Credit Facility from $75 million to $150 million.

At December 31, 2025, no borrowings and $13 million of letters of credit were outstanding under our Revolving Corporate Credit Facility.

See Footnote 15 “Debt” to our Financial Statements for more information pertaining to this facility.

We minimize our working capital needs through cash management, strict credit-granting policies, and disciplined collection efforts.

Our working capital needs fluctuate throughout the year given the timing of annual maintenance fees on unsold inventory we pay to owners’ associations and certain annual compensation-related outflows.

In addition, our cash from operations varies due to the timing of repayment by owners of vacation ownership notes receivable, the closing or recording of sales contracts for vacation ownership products, financing propensity, and cash outlays for inventory acquisitions and development.

In addition, our cash from operations varies due to the timing of repayment by owners of vacation ownership notes receivable, timing and amount of voluntary repurchases of defaulted vacation ownership notes receivable, the closing or recording of sales contracts for vacation ownership products, financing propensity, and cash outlays for inventory acquisitions and development.

Our cash flow from operations fluctuates during the year due to the timing of certain receipts and contractual and compensation-related payments.

1 unchanged sentence

Generally, cash outflows related to our payment of maintenance fees associated with unsold inventory occurs in the fourth quarter for our points-based products, and in the first quarter for our weeks-based products.

In addition, during the first quarter of each year, we generally have significant variable compensation-related cash outflows associated with payment of annual bonuses.

Timing of Estimated Tax Payments

The Internal Revenue Service provided for the deferral of federal income tax payments as tax relief for businesses in parts of Florida affected by the hurricanes that occurred during the third and fourth quarters of 2024.

This relief allows us to delay making certain estimated tax payments, without interest or penalty.

As a result, we deferred $38 million of estimated tax payments from the third and fourth quarters of 2024 to the second quarter of 2025.

Similarly, in the prior year, as tax relief for businesses in parts of Florida affected by the hurricanes that occurred in 2023, we were able to defer $32 million of estimated tax payments from the third and fourth quarters of 2023 to the first quarter of 2024.

In addition to net income and adjustments for non-cash items, the following are key drivers of our cash flow from operating activities:

In addition, during the first quarter of each year, we generally have variable compensation-related cash outflows associated with payment of annual bonuses.

In addition to net income or loss and adjustments for non-cash items, the following are key drivers of our cash flow from operating activities:

Inventory Spending (In Excess of) Less Than Cost of Sales

1 unchanged sentence

Inventory spending $ (111) $ (183) $ (89)

Purchase of property for future transfer to inventory (10) (27) (12)

Purchase and development of property for future transfer to inventory (140) (10) (27)

Inventory costs 136 150 176

Inventory spending (in excess of) less than cost of sales $ (115) $ (43) $ 60

Although we have adequate inventory on hand, we intend to continue selectively pursuing growth opportunities by targeting high-quality inventory that allows us to add desirable new destinations to our systems with new on-site sales locations to support anticipated future contract sales growth.

Where possible, we will structure transactions to limit our up-front capital investment and allow us to purchase finished inventory closer to the time it is needed for sale.

These capital efficient vacation ownership transaction structures may consist of the development of new inventory, or the conversion of previously built units, by third parties.

In addition, we may develop inventory on our balance sheet in key markets where we believe the opportunities will generate acceptable risk adjusted returns.

We plan to restrict our new inventory spending to capital efficient arrangements where our cash outlay coincides with start of sales, as well as low-cost reacquired inventory.

Through our existing VOI repurchase program, we proactively acquire previously sold VOIs from owners’ associations and individual owners at lower costs than would be required to develop new inventory.

Among other reasons for repurchasing inventory, we expect these repurchases will help stabilize the future cost of our vacation ownership products.

Our spending for real estate inventory in 2024 was higher than our cost of sales due to our acquisition of vacation ownership units in Waikiki and purchases under our VOI repurchase programs.

Refer to Footnote 3 “Acquisitions and Dispositions” for information about acquisitions that occurred in 2024.

Purchases of property for future transfer to inventory in 2023 included the acquisition of property in Charleston, South Carolina and Savannah, Georgia.

To manage our inventory spending and more closely align it with future sales, we have delayed the construction of certain projects.

We expect inventory spending to again be more than cost of sales for 2025 based upon our existing commitments to purchase inventory in 2025.

In 2025, we fulfilled existing commitments to purchase property in Waikiki and Thailand.

Vacation Ownership Notes Receivable Collections Less Than Originations

5 unchanged sentences

Vacation ownership notes receivable collections were less than originations in 2025, 2024 and 2023 due to the growth of our vacation ownership notes receivable portfolio.

We expect vacation ownership notes receivable originations to continue to outpace vacation ownership notes receivable collections in 2025.

Repurchase of Common Stock

The following table summarizes share repurchase activity under our current Share Repurchase Program:

The following table summarizes share repurchase activity under our Share Repurchase Program:

($ in millions, except per share amounts) Number of Shares Repurchased Cost Basis of Shares Repurchased Average Price

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Payment of Dividends to Common Stockholders

We distributed cash dividends to holders of common stock during the year ended December 31, 2024 as follows:

We distributed cash dividends to holders of our common stock during the year ended December 31, 2025 as follows:

Declaration Date Stockholder Record Date

1 unchanged sentence

December 6, 2024 December 19, 2024 January 3, 2025 $0.79

February 15, 2024 February 29, 2024 March 14, 2024 $0.76

February 20, 2025 March 5, 2025 March 19, 2025 $0.79

May 12, 2025 May 23, 2025 June 6, 2025 $0.79

22 unchanged sentences

(1) Includes principal as well as interest payments and excludes unamortized debt discount and issuance costs.

(2) During the second quarter of 2024, we amended the Corporate Credit Facility to provide for the New Term Loan, which is scheduled to mature on April 1, 2031.

The proceeds from the New Term Loan were used to refinance in full the Term Loan, which had a balance of $784 million as of March 31, 2024, and was scheduled to mature on August 31, 2025.

(2) Payments based on estimated timing of cash flow associated with securitized notes receivable.

(3) Arrangements are considered purchase obligations if a contract specifies all significant terms, including fixed or minimum quantities to be purchased, a pricing structure, and approximate timing of the transaction.

Amounts reflected herein represent expected funding under such contracts and primarily relate to future purchases of property and vacation ownership units and information technology assets (hardware and software).

reflected herein represent expected funding requirements under such contracts and primarily relate to future purchases of property and vacation ownership units, outsourced services, and arrangements related to information technology, including cloud computing.

Amounts reflected on the consolidated balance sheet as accounts payable and accrued liabilities are excluded from the table above.

1 unchanged sentence

In the normal course of our resort management business, we enter into purchase commitments on behalf of owners’ associations to manage the daily operating needs of our resorts.

Since we are reimbursed for these commitments from the cash flows of the owners’ associations, these obligations have minimal impact on our net income and cash flow.

Since we are reimbursed for these commitments from the cash flows of the owners’ associations, these obligations have minimal impact on our net income or loss and cash flow.

These purchase commitments are excluded from the table above.

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Accrued liabilities 1 130 123 124 (2) 376

Deferred revenue — 15 157 190 (8) 354

Deferred revenue and other — 11 157 212 (9) 371

Payroll and benefits liability 1 109 74 34 — 218

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Equity in net income (loss) of subsidiaries (276) 129 — — 147 —

Net income (loss) 218 337 142 180 (660) 217

Net loss attributable to noncontrolling interests — — — 1 — 1

Net income (loss) attributable to common stockholders $ 218 $ 337 $ 142 $ 181 $ (660) $ 218

Net loss (308) (94) (157) 105 147 (307)

Net income attributable to noncontrolling interests — — — (1) — (1)

Net loss attributable to common stockholders $ (308) $ (94) $ (157) $ 104 $ 147 $ (308)

Recent Accounting Pronouncements

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See Footnote 5 “Vacation Ownership Notes Receivable” to our Financial Statements for further information on our assessments of our originated vacation ownership notes receivable reserve.

• Inventories and cost of vacation ownership products, which requires estimation of future revenues and product costs to apply a relative sales value method specific to the vacation ownership industry and how we evaluate the fair value of our vacation ownership inventory.

• Inventories and cost of vacation ownership products, which require estimation of future revenues (including pricing assumptions) and product costs to apply a relative sales value method specific to the vacation ownership industry and how we evaluate the fair value of our vacation ownership inventory.

See Footnote 20 “Restructuring and Impairment” to our Financial Statements for further information.

• Valuation of property and equipmen t, including when we record impairment losses.

See Footnote 20 “Restructuring and Impairment” to our Financial Statements for further information.

• Valuation of goodwill and other intangible assets, including how we determine the fair value of goodwill and our other intangible assets and reporting units, and how we determine when an impairment loss should be recorded.

During the fourth quarter of 2024, we conducted our annual goodwill impairment test and did not record any impairment charges.

The estimated fair values of our reporting units exceeded their carrying amounts at the date of their most recent estimated fair value determination.

During 2024, we evaluated our other intangible assets for impairment and did not record any impairment charges.

See Footnote 10 “Goodwill” and Footnote 11 “Intangible Assets” to our Financial Statements for further information.

• Loss contingencies , including information on how we account for loss contingencies.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis