DiamondRock Hospitality reported fourth‑quarter 2025 results that beat consensus estimates, with funds from operations (FFO) per share rising to $0.27 versus a consensus of $0.0556 or $0.24. Total revenue for the quarter was $274.5 million, slightly below the consensus range of $273.14‑$273.38 million. Comparable total RevPAR increased 1.2% year‑over‑year to $319.06 per available room, and comparable hotel adjusted EBITDA reached $316.5 million, up 1.1% from $280.5 million in Q4 2024 and 1.1% from $75.9 million in Q4 2023. The company’s full‑year 2025 revenue of $1.12 billion represents a 1% increase from the $1.10 billion reported in 2024.
The company’s balance sheet was strengthened by a July 22, 2025 refinancing that eliminated all mortgage debt, leaving the portfolio fully unencumbered. DiamondRock also reported $137 million of share‑repurchase capacity remaining at year‑end, underscoring management’s confidence in the firm’s valuation and cash‑flow generation.
CEO Jeffrey Donnelly said the results were driven by a “robust rebound in transient demand and increased out‑of‑room spending after the conclusion of the federal government shutdown” and a “strategic reduction in property and corporate costs.” Mark Brugger, the company’s CEO, added, “Our strong fourth‑quarter results underscore the effectiveness of our strategic initiatives and the resilience of our diversified portfolio.”
Management reiterated its 2026 guidance, maintaining a full‑year adjusted FFO per share range of $1.09 to $1.16 and a comparable total RevPAR growth outlook of 1.25% to 3.25%. The guidance remains unchanged from the prior year, reflecting confidence in continued profitability and modest growth expectations.
The earnings beat was largely attributable to disciplined cost control and a rebound in transient demand, which helped offset modest RevPAR declines in some markets. The slight revenue miss relative to consensus likely reflects pricing pressure in certain segments, while the comparable hotel adjusted EBITDA margin of 28.32% – a 2‑basis‑point improvement over 2024 – signals that the company is maintaining profitability despite rising labor costs of roughly 3% year‑over‑year. These dynamics suggest that DiamondRock is well positioned to sustain its premium portfolio’s performance while navigating headwinds such as labor‑cost inflation.
Investor sentiment was mixed, with market participants weighing the strong earnings beat against the modest revenue miss. The company’s continued focus on cost discipline, debt elimination, and share‑repurchasing capacity signals a solid financial footing and a cautious yet optimistic outlook for the coming year.
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