Host Hotels & Resorts, Inc. (HST) Earnings & Analysis

Latest quarter

Host Hotels reported Q2 FY2026 revenue of $1.6 billion, which was 1.18% above the consensus revenue figure of $1.6 billion. The company reported adjusted EPS, as the consensus counts it, of $0.63, compared with the $0.62 consensus estimate, or 1.61% above consensus. Its filing reported diluted EPS of $0.35, up from $0.32 in Q2 FY2025.

Revenue was $1.6 billion, up 3.40% from a year earlier, while free cash flow was $447.0 million, compared with $413.0 million in Q2 FY2025. The filing showed gross margin of 31.4%, versus 30.8% a year earlier, and operating margin of 17.9%, versus 17.5%. Jim Risoleo said comparable hotel RevPAR improved 7%, driven by rate growth and higher food-and-beverage revenue, while comparable hotel EBITDA margin rose 60 basis points to 31.9% because of rate growth and lower fixed expenses.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Jim Risoleo said comparable hotel RevPAR growth was driven by sustained luxury-resort demand, World Cup-related rates and group performance. He said the World Cup contributed approximately 160 basis points of RevPAR growth in the second quarter and that the company expects the event to contribute approximately 70 basis points of gross RevPAR growth for the full year. Risoleo also said rate growth is expected to normalize in the second half after outsized growth in the first half.

In the Q&A, Risoleo said transient revenue increased 7%, with higher rates supporting growth while demand remained relatively stable. He said business-transient revenue rose 4% and group room revenue increased 7%, while total group revenue pace was up more than 5% from the same time a year earlier. Risoleo said Maui RevPAR grew 14%, occupancy increased by more than 8 percentage points, and the company continues to expect Maui properties to contribute approximately $120 million of EBITDA in 2026.

Sourav Ghosh said rooms growth outpaced ancillary revenue because special-event rates lifted rooms revenue. He said food-and-beverage revenue grew 6%, including a 7% increase in banquet and catering revenue, while other revenue was approximately flat as lower attrition and cancellation revenue offset growth in golf and spa revenue. Ghosh said comparable hotel EBITDA margin was 31.9%, 60 basis points above the prior-year quarter, and that year-over-year margin comparisons are expected to moderate in the second half because of lower expected rate growth.

On investment, Risoleo said the Hyatt Transformational Capital Program was nearly 90% complete and expected to finish by year-end 2026, while the second Marriott program was approximately 37% complete. He said the company expects approximately $19 million of 2026 operating-profit guarantees from the two programs to offset most EBITDA disruption. Risoleo also said the company sold the Sheraton Parsippany in June for approximately $12 million as part of its strategy to sell lower-growth assets with elevated near-term capital needs.

Ghosh said the low end of the outlook assumes weaker short-term transient booking trends, while the high end assumes better short-term transient booking trends. He said Host does not yet have budgets for next year and did not provide a wage-and-benefit growth figure for that period.

Guidance

Host raised its FY2026 comparable-hotel Total RevPAR and RevPAR growth outlook to 4.75% to 5.25% over 2025, from its prior RevPAR growth range of 3.0% to 4.5%. The company expects comparable-hotel EBITDA margin to increase 40 to 50 basis points year over year, compared with its prior 20-to-50-basis-point range. Host now anticipates $16 to $20 million of 2026 EBITDA from the Four Seasons Orlando condo development, compared with its prior expectation of $20 to $25 million. The company said capital expenditure guidance is approximately $550 to $630 million, versus its previous $545 million to $655 million range.