Earnings call transcript Q2 2023

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Operator

Good afternoon, ladies and gentlemen. Welcome to the Vacasa Second Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode and please be advised that this call is being recorded. After the speakers' prepared remarks, there will be a question-and-answer session. [Operator Instructions]

time, Mr. like this call turn at to over now I to would the And of Relations. Domyancic Ryan Investor Please go ahead.

Ryan Domyancic

I'm joined Good afternoon, and Second Call. Vacasa's us CFO, today to everyone, and thanks Quarter for Bruce Schuman. XXXX Rob by CEO, today joining for pleased Greyber; be Earnings

Before let of today's of live a and redistribution me few call prohibited. details. This date we information of that the broadcast begin, this is contains speaks cover administrative only as broadcast,

section a of will posted letter shareholder investors.vacasa.com our the IR website have that our We be speakers. on at by referenced

Comments events, made future are about our contain and conditions Such during commonly this letter that those objectives, in include expectations, conference financial performance. beliefs, statements. call statements forward-looking statements shareholder and plans, referred projections, as to estimates, may targets,

that actual differ factors results caution anticipated. various cause to could those from We

Risk additional read please forward-looking letter issued and earlier information today the filings the forward-looking and section risks concerning the shareholder For section in with the we Factors uncertainties, in SEC. in our these statements statements

discuss found These we be our comparable a for regarding including in Information non-GAAP this a results GAAP our shareholder call, our results may GAAP measures. financial should are addition results, substitute certain our of measures be the to financial and non-GAAP most be financial GAAP non-GAAP to non-GAAP directly measures intended in letter. reconciliation to During considered will not results.

to like Rob And Rob? the over Greyber. now I'd to call hand

Rob Greyber

for quarter and our business. you we update results progress everyone, to afternoon, for on us. an all second an to with share financial during Good you provide be review the outlook and made joining to the pleased I'm thank today to the

in Vacasa in Schuman, by Bruce the start of business CFO, become June valued team. has ingrained months member welcoming our just and to in new a is Vacasa. our already leadership short like and I'd Bruce to two joined

all of as Intel years you to I XX forward including Bruce date, one Bruce, largest technology-driven more Vacasa, in your XX for serving brings years nearly nation's before than years of real and lenders. CFO contributions with the of at come. to the you to working estate to experience look thank

to on business. updates Now our the for

are peak busiest June through of with from the which represents three-month a our period summer season the We midst of August, time in our year.

months, the these reservations, today and XX,XXX more than facilitate we some and we year, will operators a team. size During dedication will industry our of scale manage more other on and Vacasa of over reminder the XXX,XXX of in than a weekends, manage reservations incredible

our such and destinations press to vacation increased months industry A discussing demand has in social uptick and received articles significantly market work, media hybrid in and the and as on quick most the attention in-office local urban supply. and returning recent national word and dynamics, rental on with in international

trends highlighted and the in of starting spotted last We fall year. these

the industry. the our With to Vacasa were the more address believe revenue we are our approach, benefit markets. on we these majority data-driven of than data, vast Based listings able to in of management revenue adjust shifts. and stance our generating scale our

home to or with night levels been line environment price, in challenging record tracking year, booking XXXX last relative lower roughly per reached has during average While vacation value while a year. primarily rentals are sold more nights for per we is last peak gross seeing season the

ever, than As a summer for result, our welcoming teams vacations. guests their are busier

and to summer hard in the and am year. early execution progress our priorities Vacasa the seeing and on dedication recognize months. I as all proud are operations, of of field. during some made starting in the pleased the benefits work I'm last are guest the focused delivering work I sharply levels against set colleagues our with busiest changes we are we and want service We we seasonally we

for the to a all back of problem I shared to not to large outlined you in market it. with our learn use built market, have joined addresses tremendous But we in that's to thus our with November, with as front Vacasa improve. the data a and spoke the technology dynamic at best. has and first hard Vacasa Vacasa to technology focus potential this foundation I when I far our first sharpen who in best opportunity reach time needed I When with competitors perform and solved

the proud is our adjusting of of in Nevertheless, which never Over especially across and helping business. nine way employees I'm have our Vacasa make we easy, incredibly progress all market environment. demonstrable for months, the past we've facets a our been changing teams work, persisted, all

the XXXX, in the four ruthlessly local by functions, markets individual the Improving critical right guided product sales I developing execution and prioritizing potential our support customer Throughout of priorities. team and approach, growth. and the have service drive needs unlocking and profitable been to offerings technology business

wins we week, be by stacking momentum and substantial entire our business, to what's these results real against beginning remain but have will There our made are There and goals. always been excited forward across but for and to back, the gaining is progress are do, are efforts ahead. of and materialize. steps up I incredibly more Week we

operate reservation anticipation becoming a our markets, teams demand. XXXX, In quarters staffing aligning dynamic in We stronger local staffing with stronger tactical environment. more the of to our and XXXX the particularly we and spent in last regard were in levels several way in

collaborating accordingly. and closely markets more adjusting and in demand resources watch are booking local to intakes we Now

We in quarter improved second quarter. have also the changes we these purpose-built tools and technology into carried for The first our teams. out integrations from saw local progress rolled the initial

metrics, year. last service improvements closely result, most efficiencies quarter, the satisfaction, And for other year-over-year a among line more to key demand our uncertain sacrificing in very second as also these environment. which example, key operating is across despite we guest we achieve a saw local importantly, aren't during metrics, we market watch As levels, right with

take removing We've teams customers. and up of with better revenue across all also finance. that resources support are alignment layers experience human and we markets, support management management, care and local teams of owner the set drive managing to analytics closer and processes these operations from approach the functions local empowering On that real-time the who guest

also technology key the We've first the of workflows of year an and during guest guests of even decreasing half into with homes while managing owners cost brought goal with better the the experience. and new stays, providing

homes. get that homeowners launched into with We daily an example, visibility tool which operations we released their an easier field quarter on tasks. their the unprecedented view through teams, we greater HomeCare For provides automated making for our scheduling and to last it dashboard, providing touched into

online with see XX recent of example, for showing their and reports XX shared the photos launch, Now of providing with inspections, Since owners millions owners issues home. homeowners. photos can track of we've to maintenance condition

operations We've guests to tools communications incorporated tools, market chat a our web our local These and for bring both communications with more a medium also homeowners, guests. immediately communications up Vacasa. opening and and a for to win efficiency into win homeowners, for for technology SMS our and another owners our win

our On the and we that the changes which individual we've hold. to sales taking approach, are implementing primary platform, in add testing been way homes

retooling to streamline Our the been individual work. simplify has approach we how and guiding sales for principle

include sales our out homeowners single expertise for the on offer implemented the have develop rep we build them to the internally developed we and the we pricing local to allowing a experience number onboarding to crave, manage so homeowners the the market, and that rolling adjusting technology focuses changes homeowners, and simplifying complexity tools incentive improve internally. new the of plans structures reducing of organizational Some structure, every market

made half second the trended still consider growing the relative improvements we've to we've focus years, continue of churn fully solidifying In the on to Once Encouragingly, will elevated prior year, recent the homeowner team. new institutionalized we'll these in quarter. second be months. in the right sales the processes, direction has in productivity our while then

of the churn of continues about off data to the primarily two income is years. concerns to homeowner indicate levels Our comes due that industry level as record higher

communications state significant are level have homeowners underscore to those the including market by our these Vacasa, the and positively sharing been specific We trends industry, to aren't data efforts that homeowners. of to received making about educate

the On more pushing to we often. enhancements our development significant cycles shortening each product completely shipping are a process Rather few changed technology release smaller of and than we front, products development. year,

we and homeowners, colleagues result, and updates having positive a tools impact in and front business. These product getting a guests of and better meaningful improving our experiences As on are are more faster. advancements

inbounds. for click-to-SMS transfer resoundingly on half now hold exceeding waiting to feature, speak have agent. earlier, of launched example, SMS, the mentioned I making first we and easier prefer. Vacasa with for guests to homeowners SMS this For that it the an communicate rather year, inbounds Guests we phone guests with the SMS In if a they feature are to over than opted to to giving option

easily changes and These of their for service to our answers get our a efficiency communicate representatives. allowing Vacasa the better create them faster with questions guests, to customer experience while improving more

is team exploring also in can intelligence how new tools be artificial workflow. used our The

using example, we with us up to X.X To-date, more homes pools, conversion. we than as ensure relevant or homes the any insights guest and reservation query have these images kitchens, the are well on for experience we relevant tagged drive the scores. expand tool like to analyze by more image manage attributes help provide to most now and goal to homes photos serving are For with listing the of million amenities. is a all as analyzed booking quality improve patios for The listing filter

business continue growth. drive profitable needs prioritize we Finally, to to our

and and administrative operating We year-over-year. managing are expenses our carefully down marketing sales expenses general and with and development, technology

this development We driving guests. and the are operating in a career, experience seen deliver my and product play to results a I'm I've and about more better dynamic excited finding though out path to focus and Vacasa homeowners for have lot we ahead. do, is times our starting Even on discipline many for is

and and are our Before so to just to to for of summer this bring season turn employees guests. like to hard year thank Bruce? say over thousands dedicated vacations I'd who our Bruce, throughout I the homeowners home peak working it you

Bruce Schuman

Rob. Thanks,

letter. second find results I shareholder restructuring noted operating and compensation, will I'll the of our combination the quarter to lines an be results can XXXX First, second XXXX. stock-based I'll quarter referencing be costs, costs review in excluding for then financial impact business outlook of I'll you provide expense second and quarter outlined our which our the Unless comparing updated otherwise,

combination second the which the Nights reached gross X% down in year-over-year. second the is year-over-year. $XXX and nights per quarter, booking booking gross million were nights sold sold up value $X.X X% For quarter, sold, million, of value,

year-over-year. However, gross down was quarter, in XX% booking value per $XXX nights the sold second

gross in Over off years. few nights past of This in value nights flat average with year-over-year per home quarter we've was average talked quarters, booking the industry value few our year-over-year. the sold continued from roughly the dynamic the as a the per home second XX% the booking highs decline gross past while about per normalizes sold, decline platform on record in

and there relationship it's also look in and between per Remember isolation. strong a sold sold gross night value at booking nights either difficult is to

and nights sold Our occupancy the algorithms trade-off optimizing revenue between price and team of sold per gross constantly and of management goal nights evaluating with and mix homeowner value are the income. the booking

the down Revenue, on our from commission X% we primarily the the solutions revenue in collect fees we and consists million was guests second of which $XXX to quarter, our homeowners, home care provided directly homeowners rents year-over-year. generate from for

and revenue in our Operations costs. local XX% consist support support period These the revenue of XX% of the quarter revenue Cost in revenue year. was of the and two same quarter was lines our market the XX% turning versus revenue of to second second expenses. expense last XX% expense same primarily last of customer versus period of in year. in Now

to to, our way improvements continue alluded manage operations. make market in Rob local As we we the

central we the We three are discipline in our leverage in operating across operations quarter. other operating also achieved year-over-year expense demonstrating lines our where second

technology basis, administrative though and expense was and X% there expenses sales year. and flat, year-over-year expense declined declined a expenses and were general development on nonrecurring XX% last Specifically, marketing some

year-over-year business a a decrease for improvement $XX the despite and demonstrates our in the same X% to increase in a the are compared teams was quarter $X X% $XX loss increased nights of operating sold year. the million last in The revenue million progress EBITDA with discipline. all period making million second Adjusted in

turning the to Now outlook.

adjusting in are the not indicated comes given industry guidance, still booking we years. as changing quarterly we two record the of As we off March, issuing explicit patterns to are

costs of more variability is more to are While the business patterns, with in our curve. especially operating making continuing booking we and the the on booking discipline close-end predictable, experience part

year the expects at to will given high believe XXXX by single-digit initial well said, XXXX peak, and year-over-year. of That percentage now full are our land we revenue growth we higher range a that decline revenue into end we guidance

For efficiently see profitability are and operating will in making adjusted we we we full and XXXX. EBITDA, progress EBITDA believe slight can year adjusted you achieve more

Rob your open that the With questions. and take lines. I please Operator, up will

Operator

Schuman Thank Instructions] first you, JPMorgan. [Operator from our today We'll Doug at question Mr. take Anmuth

Dae Lee

Thanks for This Doug. two. have on for taking is questions. Dae the I

first one around The macro. is overall

You did and returning in your urban, market work, prepared in-office hybrid letter about et to your remarks talk in uptick dynamics demand about cetera. in international,

line worst see, So based again? on you accelerating that how come? to already? that, the we seen of the in to is shift top headwinds, industry facing start when think anticipate what still you you'll shifts. the should when related the meaning Have along is Or guys far these the do your lapping peak of you start And

Rob Greyber

question. Thanks, Doug. appreciate I the

with and over seen piece, been over past to level, terms first return pricing. the by you large, is months highs minus, off what of think play normal I the of a XX forth, on saw or that macro the has several that booking to the peak kind of, of in the environment out or so pattern so, and plus we've years a patterns really respect and last some off what of a booking On sort

more been travel, that of think be to there's so think international closed forth. to in different might things I to used of some come travel sloshing forth. patterns terms that flexibility, trends example, COVID American -- during so the there's global in and bucket have destinations market. still snapback I get the to you the in And for new as some to and There's see, to availability a geographically, terms probably consumers of going bit new North as little around In that

bit back in and I to is Coast, more rhythms, of to much those think still little the more and some think West there's go. the probably I office Coast the normal East a

business, that our you largely part, see as just the what it didn't dynamics, environment most playing we're some seeing As now terms see it those of I I pricing and touches in of our we overall though. And first business. one, think was out catch see second the -- I mean, but catch we in it didn't the occupancy for play on the out I second question.

Dae Lee

to related The second one was that.

should these you So again? the when accelerating you'll meaning top your line lapping changes or anticipate business do start start of worst like when

Rob Greyber

Yes.

from feel typical But economic ball, I you that our to navigate kind environment, what the normal think terms it behalf comfortable part, behalf industry. seen of pretty of lens we're will, and is us the most in if home and what in on we're a And when reversion we I've motion at most it of in feels looking mine of our this normal I at owners in can And sort a that, kind business. the of the like mean, is I of industry. for on today. you the a changes view And have crystal kind think cyclical seeing none it of travel what this of see. for left part, I the of we

Dae Lee

Understood. Thank you.

Rob Greyber

Thank you.

Operator

take we'll JMP Nick our next And Jones from question Securities. of

Nicholas Jones

typical Great. offset kind as of seasonality we per down less and Thanks as back inform maybe half? seeing sold thinking it we like XX% down break helping of these as nights GBV to GBV of kind relates questions. should And levels? a homeowners maybe that here guess nights that sales be nights I about question GBV GBV normalize a It are this of little for efforts seems maybe on the year-over-year. lower per technology sold if are kind for might bit the returns then churn a year? taking How Do the these sold. And result per of trends nights so kind per sold?

Rob Greyber

jump in. Why Bruce to and I'll ask don't that first one I take

Bruce Schuman

they're I income at sold this. would question. really bookings for per revenue for and of industry at booking gross value proprietary on systems. looking of team our mix really Nick, daily looking mix management have test is at and Thanks, sold, the homeowners. always pricing the intakes really conducting AB Yes. the They're sell-through optimal They nights determine maximize to versus looking data, to say nights

So lowering that's typically it's management not right they've Nick, that look determined price, And revenue team, environments, that now, happens. the optimal what those sell-through travel approach rates, at maintaining for is other you the us. surprising, really when

can this nights see sold, down, XX% year-over-year. you value roughly as in nights gross booking know, that of results, line in with home quarter price play sold So per you our while out kind growth, or is was second where

answer sold. play smaller booking of on believe out, booking you on kind your mix the second the question, to nights nights to that and And going first per gross optimal is you've value environment the depend the the it. nights through half, and of one, of value, seen in back to question, to we our on year, with want of So for demand the Rob? But half and that's kind what really resulting changes sold the part declined sold gross the of the effect do the take response churn then strategy

Rob Greyber

absolutely. Yes,

owners coincided, some the can, as first in elevated continued dig much levels of to of take coincided we've that's changes the that's homeowner this some and to respect I off possibly control. certainly revenue that we of a we on dynamics of to coming think with focused observe that And before. can extent, just of they shared the With fourth step just environment we all, we've the began through that, demand one as to back. the look see that's make key And is just with the and a them. part of the let's citing first before, year. causing for as That quarter, in same think owners, time, the those reasons into that and certainly I we've seen. At churn things cited we some these economic we that when change, the highs are frustration we

side, have translates job what seeing leaned to they the in industry, individual leaning a on number going the equally explaining we on of that into so in that management things this. done trying into across expectations the communications better we what's we've are do have We've the side. of And industry, how really on a I'd seeing, also But for markets say, been, the their what are revenue XXXX. should really

market despite best So the making GBV we think on see we that. pretty per what industry It's we data are our at compare on owners job ability at possibly sold, can we large. sure nights really our look that we when we revenue when the on we're shows to our data, you drive the doing well for are and to ourselves delivering clear for focused owners that

an Again, dynamic we're expectations that on in we those what just say is them. to to So but this importantly most years, long-term like we to there's them make expect want possibly growing we cycle. can. to of last several industry-wide We're exceeding that terms to then us going I the be in managing is get a to out I just for the phenomenon. But is play wherever environment an general, and that our to for sure deliver delivering be going think owners back would is and

that extent across is to the frustration, there of some we think this So the industry. it's

the data up delivering as things, owners, that on of you we're our But on we're most think is can thing. and the social focused media shown press. again, the for control, the and in laser see evidenced we're those on kind that that that's important some with and acting showing and think we that we what's of things You

Nicholas Jones

Great. Thank you both.

Rob Greyber

Thank you.

Operator

to next at Oppenheimer. And we'll now Jed go Kelly

Jed Kelly

Hey, great. my taking Thanks for question.

and you lower know but about on on touched of touch Just making then, us efficiency give you. of remarks, really -- relative Rob, productivity there. I talk it on we looking at opening the a are just And you of sort to gains. in your the an EBITDA improvement nice revenue, Can you're Thank about where drivers update the your there? underlying you supply salesforce ramp some can lot

Bruce Schuman

Yes.

Jed. good, Sounds

the let So part, I'll then first I'll the part. on and Rob second take

discipline about improved Jed, kind entire really us, second boiled QX, us for the for So execution just of them. this quarter. a and basics is It's the to just operating throughout story down drive really to

to. a of think I couple examples point would I

field to I think tightly much better a doing this better in did job resources a booking in just patterns we there. execution quarter just operating in discipline teams of much our job variable managing kind field, and the more

we've talked there. worked discipline we secondly maintain hard think maintaining about the January, I reduction in -- to workforce just

thirdly, continue really management to this we that then I our think, through. flow leverage just team So And see operating revenue carefully. is watching

all emerging watch they on drive trends, a to as executing very a the they're what environment. very as doing is think tactical bookings at a navigate job just know they I good we level dynamic

going really we've execution steps keeping across progress but it's There will focused like business. So steps be back, that just forward, the an talked we're some story. on about,

Rob Greyber

the context to Jed, respect sales. performance in question as Jed, think think overall -- of doing part of that Yes, here. about I second with on what really that, about the Yes, I we're that the the

described. is on a that forth, unit working then We're cadence. working right, growth dependable, really and focusing and as repeatable, is Bruce on get that So first, to that our been just the motion we is the so to product process driven then have economics have ability improving

of that. pleased We will. a if solid per productivity. and formula, part we nice We're a to months, look, direction. the step it's these last You're had team second do. that had We right, asking see were the We're by kind we've there, what the about last months, that of the think quarter. part over and right kind normal seen on And of encouraged focused progress sales to of the you rep continued of making we the in couple a several things second

go-to-market focus of the So motions on business. progress? I the what's think that the of execution it's elements a driving

size manage, teams how in a right from better the plans of key those aspects the homeowners, that onboarding offer to we tools ranges to to structure, new the simplify from of for platform. geographic the number processes that simplifying force, perspective, and they our to organizational that sales pricing we and the aligning for our investing homeowners finding work, incentive So onto

look digging team I I that a when see it, is in. great at So

have side, a then some into some of operating explore next invest we can And increasing work that procedures to rest We ahead, the And of continuing remains for of growth the standard to on the in see lot we'll productivity of that's the path. progress when the invest more done. get the we and It's year maintaining along start the these that initial or encouraging on focus salesforce. get the the half to as the looking size to potentially motions. gains, continue year, back process year

Jed Kelly

facing just RevPAR similar doing then some of themselves headwinds. headwinds the is And given owners the are that it are facing, the industry I'm sure

struggling this of well, is from seeing probably that are you Are they inbound owners seeing half now hard? now into inbound you of and had thought realizing more some 'XX. are was thought from in easy 'XX, but pretty good that -- these are owners it back So a 'XX more 'XX

Rob Greyber

Yes, it's Jed. question. great Look, a

dynamic job so we a have of from work and to owners We year. when owners able that there where be been But so these better tricky proud be you us. that More a year. think going are on dynamic call. if be to partner of kind very we'll every real is engage anything and better think have inbound we about made hear need there has It's of shared that year, and to we've a on with with dynamics very far the talking the progress haven't with and doing please forth. a them. month. team focused certainly expect that me And I done better good them a I'm And navigate give We this that can for seriously, a inquiries we absolutely anybody, do rates

Jed Kelly

Thank you.

Operator

And back we for further gentlemen, comments. appears you closing Mr. questions things like turn this it to have I'd Greyber, afternoon. no to any

Rob Greyber

thank appreciate you just next owners field thank also for to this thank again the Thanks, quarter. to you questions. everyone, our for of partnership of very Operator, for and again you together. We'll the talk all of so to very all the work hard joining, I much. we've your our working season, say much. summer all peak teams really to Thanks in you done wanted and

Operator

Thank day. you, the remainder gentlemen, us Quarter of Greyber. Call. Earnings Again, Mr. to great you ladies Vacasa joining so and like conclude that and all all a We'd for XXXX you wish will Goodbye. thank much Second your

Vacasa (VCSA) 8 Aug 232023 Q2 Earnings call transcript