VCSA - Earnings call transcript Q2 2024

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Operator

Welcome, everyone, to the Vacasa 2Q '24 Earnings Conference Call. [Operator Instructions] At this time, I would like to turn the conference over to Ryan Domyancic of investor relations. Please go ahead.

Ryan Domyancic

Good afternoon, everyone, and thank you for joining us for today's call. I'm pleased to be joined by Vacasa's CEO, Rob Greyber; and CFO, Bruce Schuman.

We have posted a letter to the investor relations section of our website at investors.vacasa.com that will be referenced by our speakers. Comments made during this conference call and in our letter contain forward-looking statements. guide about plans; actions, objectives; projections; and performance, those future cost events; include results. financial beliefs; period expectations; strategies; including statements our including restructuring savings; conditions; Such future for targets; estimates; We caution could results statements. differ to forward-looking and those our cause in actual from various that risks uncertainties

sections in with risks forward-looking issued we earlier Securities and the concerning For please Commission. the letter additional these information filings Forward the read and in risk and Exchange factors statements uncertainties, the and Looking our Statements section today

this to various be During may results, non-GAAP measures. Information directly non-GAAP to call, calculated reconciliation are Rob results results over addition most non-GAAP measures, a financial now Greyber. Rob? our with GAAP found supplement call financial non-GAAP in financial not measures comparable we performance measures may GAAP the to our will intended should reference in for accordance I to substitute regarding letter. including GAAP. And of our These and considered the but be turn in

Robert Greyber

Thanks, us up and begin [ quarter business. review results, Ryan. second will and open remarks we'll follow this for on Bruce commentary of joining everyone, some opening ]. I'll with with financial afternoon for a thank Q&A. then it you, And the

impressed we business executing including flooding. same markets natural to to our to the gratitude and of we note in quarter. are outlined a all wildfires, for And by transformation time have seamless of our owners; our are and behalf and peak members, We time, the composure professionalism ensure in of disasters, appreciation last heart my the guests of season, special hurricanes on team the a currently are the year teams. At extreme to against experience we want local where I'm our of the continually tirelessly working teams had extend our busiest for teams. our who our I

best, our business success further our operate delivering on empowering transformation level. of hospitality with teams, destinations, across local our fundamentally with authority at of are guests in way and by of we pleased sales, our thousands and know I'm the and business. hundreds employees we owners we them nationally a many operate more making onboarding, progress markets, across depends revenue business, marketing. who we the While are our our week, aspects giving management including decision-making Each

the rental continues demand industry short-term units. for as adjust rentals rental short-term the softening vacation However, in domestic to supply to well as nonurban of increases

listings half this trends to business. to while we data, booking pressure variability, industry at are the continue in per experience we significant second to industry XXXX. These generating more also our and on focused abating don't the bookings markets. We bookings of the are the are and than ongoing majority our challenging, of believe industry, in so based Vacasa on we see on remain continue point, trends what continuing Nonetheless, home our this gross we real control. can put

And just more business moment like a share so details the to ago. about mentioned transformation I'd some I

approach structure more reporting shift leadership accountability regional more This to our our property teams, collaborating decentralize by were few autonomy directly months, significant with field leadership. reported now focused and aligning with to now the our taken Over steps and closely into of reorganize These corporate through operations with traditionally managed that provides to are localized regions the management. many past roles we've teams, locally up to and regions. cross-functional our

role leadership much and regions. In to and weeks, These and on local accountable and central to for shaping plans for be play increasingly in more responsible manage tailor toward our teams we approach invaluable market-level Additionally, delivering each geared will plan. off insights few knowledge we as focus and seek plans. on-the-ground next expect local implementing that on market. their our a Their we'll kick to also be XXXX; the their planning incentive are encouraging for regional will leaders

markets, also owners effect guests We to the their to are better them allow workflows adjusting efficiencies. enabling and day-to-day local and to drive more service within change easily teams

aspects and we've end-market homeowner enabled teams expenses. example, listing process approval these streamline like of owner time Changes For local duplication effort. requests satisfy and to real for of more update the the [ in ] help quickly limit

] the in We of are more on have brought and certain amenities input local characteristics, focused that and including are based teams right the the signing on [ sales more ensuring potential. rent type on teams location, their identifying also giving markets; the homes homes on

on empowering business drive should better outcomes. teams that is experience, guest and thesis our the would which local result in impact Our homeowner turn the strongest in

service it's key metrics that early measure end the through July, been scores. improvements announced in seeing week we've scores, clean scores since in of transformation condition May, each of many While we year-over-year days satisfaction, our and in the markets, property including guest

our side, homes has declined due to executives to of On reduced spend. of expected platform number as the the added advertising the sales sales number quarter-over-quarter and

are business than our As absolute number an a quality under transformation, of on As part sales moving and teams management. rather focus reminder: unit on to we the revenue of potential homes

owners, them. who Finally, deploy improve develop we guests technology to support and continue tools members the and the for that experience team

dynamics evaluate various to The do, more industry is to continuing remain executing aspects we and also highly industry plan. leveraging for transformation there third-party of our applications on focused our challenging, so infrastructure. are We remain

quarter Kempner's Kempner, Sosa to will today, a our pass strengthen second our balance join and help $XX we Directors. I'd like Board with forward by Lastly, million they to Bruce also it to Liu Davidson discuss of results. over to our announced sheet. seen, We look investment as as now you which Luis will Davidson have Alan working

Bruce Schuman

in I'll Thanks, Rob. Unless noted stock-based expense outlined find second lines restructuring combination referencing compensation, the which shareholder you business costs be otherwise, results the I letter. quarter our impact quarter comparing our be second excluding the And will of XXXX. costs, can and to operating of

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

There to strong it's a reminder. night sold at sold and either in correlation look difficult per gross is nights value between a and booking As isolation.

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

And approximately past in play been this rental quarter again several past dynamic with our saw XX,XXX the the and to gross second the year-over-year per to seeing. the record gross on from out the the quarters, nearly end home finished booking normalizes of short-term we value in years. average XX% XX,XXX homes increased value dynamic at gross adjust the declining average that off platform, from per discussed year-over-year. We booking the average The headwinds first of Over we churn per with industry booking approximately as highs home. lower ongoing second down industry the have the home supply quarter, quarter various we've value reflecting declines few as continues by such

the the these and cause with our We to a guests solutions resulting primarily and quarter, in of with of factors. Revenue, care we rates revenue provided as homeowners, commission the from we industry which also owner directly wrestles $XXX to home for down rents continue churn consists our leading on generate concerns from as the million see XX% homeowners, was fees second collect the year-over-year. income

in year-over-year, of the by turning the revenue line period quarter revenue XX% of and the XX% with Now the by same expense quarter of last of Cost XX% in declined year. year. roughly in Operations sold. support in revenue support Cost in versus second dollars revenue versus revenue expenses. to XX% was of declined same and second of year-over-year. period decline last XX% XX% expense the revenue nights X% Operations was in dollars

compared legal sales affected second terms home; And bookings includes same impacting EBITDA by by and of operating declined expenses, and and services our expenses. Adjusted third-party expenses XX%. general last to $XX administrative expense, outside adjusted primarily declined which gross our million which year-over-year. declined the ultimately million reductions, Technology and for per in In value $XX booking expense million development we $X Despite pay year. professional X%. XX% marketing to distribution by fees our and partners, increased was the due expense revenue, variability EBITDA be quarter to progress on period the continues other

sold touched per peak we half per home Rob out As experience nights summer of weakness and booking into gross in terms on, are back bookings or in continuing we both this or the utilization of year. night look as and sold to value price

home, their EBITDA. outcomes variability as are adjusted ongoing yet At creates stabilization impact of industry a and for bookings guidance. provide gross monitoring as bookings revenue, difficult average point, flows range per in and which of on remains to elevated don't intakes signs to continued through We wide then forward-looking but this see the churn, it term. The well near carefully dynamics

Vacasa's notes. Additionally, provides initial principals Alan Board, to of $XX Sosa, an $XX signing of notes, $XX with purchase has the of With Liu at and the of we convertible to as of to with Vacasa's purchase questions. I of up up announced Directors. directors financing lines. right X subject will the Kempner agreement. additional Rob conditions note of million this immediately. With and also effective Kempner, an of Kempner Luis issuance to that, designate will closing and take today, convertible agreement open The Davidson Davidson Davidson mentioned, please the a Operator, terms investment both million for note the join your initial million, Board Rob convertible the and

Operator

the first [Operator question Your Instructions] Needham. McTernan of line of comes Bernie from

Stefanos Crist

in Stefanos is for calling Crist Bernie. This

rate focus we the of some year-over-year? promo then that QX. on quality number improved take Is the during driver You mentioned homes. of noticed And versus also the

wanted I puts rate. to the takes take guess we So just on and get

Bruce Schuman

Yes.

focus basically home very -- really a seen is mean that's about focus of that. talked quality So on We we We've key some transformation. There's continue us. I no a improvement for difference. our top

was critical top about again, that there priority continues We but home and really specifically, for take the company. part our very of quality, comment be There disclosed anything haven't transformation to on a nothing to rates. is

Stefanos Crist

then seeing of increased it. churn ask on versus Got just to again you're wanted the in And supply. what market

about the quarter? anything just talk during you adds can gross Just

Robert Greyber

in. start if can I'll you'd like. add sure. Yes, Bruce -- And

what dynamics we've I think I with seen. think, consistent, churn all, of the that, first remain around

very are focused it. We on

on there We have drivers major Recall go to that into seen churn. are with that the respect drivers that X we've focused we're it. --

is rates of revenue and is per first around and The rates because home -- dynamic and it The on home. second much challenging we happening interact it per in communications revenue is the is and around the we dynamics around driven how the by what and revenue, see owners. overall revenue with market so industry

we're local to transformation -- our that as those in months teams, communications, product teams sure in with constructively, We're comes processes kind control there's a the so changing can owners to work in better to heart with everyone our have to more for lot dynamically and working in-between ] with that shipped very that and before world. we've and owners. possible revenue revenue hard premiums in doing to of the but to work also also And changing work delivering empower year many that on and we're When as empowering management great focused more we're enabling our talked more do. degree the of closely, as about policies [ a as and and work we what we our teams owners at our it of make the that around

be. and now So on have, that We've that closely but see so churn. comes hope but we're teams that think the and align initiatives forth, it we we to not we bear mix days begin I much rest to we're the organization continue When the elevated of in sales there. the fruit, working to we with the want it's where field. early dynamic see units around traction to And the more to right some us for seen to

Operator

line of the Miller Sachs. of Goldman from comes question next Ben Your

Benjamin Miller

why you liquidity now, perspective amount; feel demand just that from look financing; a over scenarios talk understand against year next you're the about so. set the out now I and and why various want as up we or to how maybe

Bruce Schuman

question. the for Ben, Thanks, Yes.

our first challenging executing managing Rob think this We have demand softening few on look of industry empowering to very from a Davidson balance and have the they've engaged think our drive we of next for quarters. our opportunities open been Davidson in, as forward say, they've public of sheet, transformation So we the does this. lot their business And strengthen Kempner actioning balance continue interested -- we're all, business, -- but your investment term. leaning common to earlier Davidson point. and the drive so look: the look. on path the very We us, to and long helps We're working sheet do help and transformation and work in environment with this our always rest I thinks really listening this Kempner especially we was. interested to Kempner purchase what investors really teams focused a this as and stock Board And to a know plan I we plan, company, year, strengthen over been we partnering of in and think very our since to forward. to liquidity, and value been specifically, that's and to would local our the open with of

Benjamin Miller

as a around earnings homeowners we -- you've out. curious and and just maybe where some of optimize platform on Great. via earnings And on expectations occupancy among and helping stand for initiatives rolled of that around follow-up, resetting pricing then tools communication just the homeowners the the

Robert Greyber

Yes.

into think that that. I has lot a of there's work gone

on ago, said we're initial still good challenging environment. a owners. a moment It's I from some that As seeing feedback

You can dynamics. those explain

about If still down, financial talking your if but investments, it's you're a the adviser to market, challenge. can market the you be is beating your personal

can to we exists, think we there's we lot is are the delivering. of when make seeing about I Or the that results, versus but are at market dynamic That's and a revenue how kind we communicating then communicating the when the we doing, similar think obviously and delivering we're holds, that what data a acting on sure work why with how again doing are what we're owners everything there. we market that. the compare and ultimately we're we industry, look premiums focused more industry talk our that if do in analogy we to

generally work challenge make more ourselves, we guide local in to along think to doing, I more and across we're the all it's that, more empower to collaboratively teams the of a and that that our Ben, to company transformation make terms the those lines, lot first, of sure work decision.

points and sure make a -- communicated done information teams tighten several our between -- lot regular the revenue in local -- work hear management and about to those away. So the we've just really of we the of to right the up teams last relationships months that the connections, those concerns, the to exchange that touch are that things

progress tough So on work do. against of making I we make a still to a like feel to there's that, but environment are lot progress it's and

Operator

to That ] I Greyber for go concludes conference remarks. our Rob turn closing Brager now session. back over Rob ahead. [ the will question-and-answer Please (sic)

Robert Greyber

are all moment time. homes of joining I much. know want thank take all to the vacations to working to important Thank our season including our and everyone at you want bring I this who colleagues are call making us; joining. for every much entrusting a a peak so very guests Vacasa's it's busy very for XXXX. Thanks hard to in today. of day, memories their Vacasa, who for home to to also I of us; summer with owners, thank

Operator

Ladies that you today's joining. all and gentlemen, Thank concludes for call.

now You disconnect. may

Vacasa (VCSA) 8 Aug 242024 Q2 Earnings call transcript