Pebblebrook Hotel Trust Stock Earnings Reports

Pebblebrook reported Q3 2025 results roughly in line with guidance: same-property hotel EBITDA of $105.4M (midpoint), adjusted EBITDA $99.2M (beat midpoint by $2.2M), and adjusted FFO per share of $0.51 (beat midpoint by $0.03). Occupancy was up ~190 bps but ADR declined 5.4%, driving a modest RevPAR decline (same-property RevPAR -3.1%, total RevPAR -1.5%). Performance was led by San Francisco and Chicago and several recently redeveloped resorts (notably Newport Harbor Island Resort and Jekyll Island Club Resort). Los Angeles and Washington, D.C. were the largest drags (weather, safety/perception and government-travel weakness), and the ongoing federal government shutdown is an identifiable near-term headwind. Operating execution remains strong: same-property hotel expenses before fixed costs rose only 0.4% and expenses per occupied room fell ~2%. Capital spending is normalizing ($14.2M invested in Q3; full-year 2025 capex expected $65–$75M), supporting higher free cash flow. Balance sheet actions included a $400M 1.625% convertible note issuance used to retire $400M of 1.75% convertibles, repurchase of $50M common stock (accretive), $232M cash on hand, and an expectation to generate >$100M free cash flow in 2026 with a plan to use cash/free cash flow to retire the remaining 2026 convertibles. Management is constructive on 2026: they expect favorable holiday-calendar tailwinds, a strong major-events calendar (including many World Cup matches and other marquee events), continued benefit from redevelopments, limited new supply, and the potential to outperform the industry — but remain cautious near term given macro/policy uncertainty and the government shutdown. A $72M hotel disposition is under contract (classified held for sale) and expected to close in Q4 subject to conditions. Key risks: prolonged government shutdown, further demand disruption in D.C. and L.A., geopolitical/tariff uncertainty, and last-minute booking patterns for major events.