Summit Hotel Properties, Inc.

Second-quarter pro forma RevPAR increased 5% year over year, with average daily rate up 7.1%. Hotel EBITDA increased 7.8% in the pro forma portfolio, and adjusted EBITDAre rose 7.7% to $54.8 million. Adjusted FFO increased 6.7% to $34.9 million, or $0.29 per share, and total pro forma revenue increased 5.2%. Management said full-year 2026 guidance now calls for pro forma RevPAR growth of 1.75% to 3.25%, adjusted EBITDAre of $175 million to $182 million, adjusted FFO of $95.5 million to $103 million, and adjusted FFO per share of $0.79 to $0.85. Hotel EBITDA margins are expected to be down 25 basis points to up 25 basis points for the full year, with pro rata interest expense expected to be $58 million to $62 million, preferred distributions at $18.5 million, and capital expenditures at $55 million to $65 million.

Jon Stanner struck an upbeat tone, emphasizing that demand trends improved through the second quarter and continued into July. He said the business is seeing a “remixing” toward higher-rated corporate, group, retail, and government demand, with stronger midweek urban performance and a lengthening booking window that he views as a positive sign for durability. He also framed the company’s asset sales, portfolio quality improvement, and balance-sheet strengthening as central to value creation.

Kevin Milota mainly handled the formalities and forward-looking statements, while Stanner gave most of the financial detail. The call highlighted a new $650 million senior unsecured credit facility that extends maturity to June 2031 and lowered borrowing costs by 20 basis points at the current leverage point, plus a mortgage amendment that reduced the spread on the AC and Element Miami Brickell hotels by 30 basis points. Management also noted that roughly 50% of pro rata debt is fixed after swaps, over 60% is fixed including preferred stock, there is nothing outstanding on the revolver, and there are no debt maturities until 2028. On capital deployment, the company repurchased about 49,000 shares in the quarter at a weighted average price of $4.27 and has repurchased 5.1 million shares since inception for $21.6 million at $4.26 per share.

Analysts focused on the durability of demand ex-World Cup, the mix shift toward higher-rated segments, expense trends, and capital allocation. Management said the World Cup was worth about 100 basis points of second-quarter RevPAR growth, but that the more important trend was stronger retail, corporate negotiated, and smaller group demand, with July preliminary RevPAR up 6% and third-quarter pacing roughly mid-single digits. On expenses, management said full-year operating expenses are expected to rise about 3%, with labor trends stable, and on capital allocation they said the company remains a net seller of assets near term and would continue to buy back stock only when there is a clear dislocation.