Ryman (RHP) Q2 Revenue Jumps 7.5%

Ryman Hospitality Properties (RHP 1.18%), the real estate investment trust focused on group-oriented hotels and entertainment venues, released its Q2 2025 financial results on August 5, 2025. The most notable news: it set an all-time record for consolidated revenue, which came in at $659.5 million and was well above expectations. Despite this revenue outperformance, profitability (GAAP) was pressured, falling below both prior-year levels and analyst estimates. The company posted GAAP net income per diluted share of $1.12, short of the expected $1.14 GAAP EPS. The quarter highlighted both the strength of its top-line sales and margin headwinds connected to market supply and mix shifts. Management described near-term pressure but reaffirmed the company's long-term growth focus. Overall, the period showed robust revenue growth, but rising costs and industry dynamics reduced bottom line profitability.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.

Business Model and Strategic Focus

Ryman Hospitality Properties operates as a real estate investment trust, or REIT, managing large convention hotels and country music-related entertainment venues. Its portfolio is most known for its Gaylord-branded hotels, which are major destinations for corporate and association group meetings, as well as the Grand Ole Opry and related entertainment assets in Nashville.

The company aims to create value by blending recurring group meeting revenues with diversified entertainment income. Its key strategies include expanding its hotel portfolio, improving operating efficiency via partnerships like the one with Marriott, and growing non-hospitality revenue streams. The focus on these core areas is critical against a backdrop of volatile travel patterns and shifting group booking demand.

Quarterly Review: Major Developments and Performance Drivers

The quarter saw record-setting consolidated revenue (GAAP) of $659.5 million, up 7.5% year over year and sharply above analyst forecasts. This growth was led by both the Hospitality segment and the Entertainment segment, with the latter setting a new all-time high for quarterly GAAP revenue of $143.3 million, a 52.1% increase. Despite this, profitability metrics moved in the opposite direction: GAAP earnings per share fell 32.1%, and operating income dropped 17%. Adjusted EBITDAre, a key cash-flow metric for REITs, fell 9.2% year-over-year as increased costs and margin pressures weighed on results.

Key events included the acquisition of the 950-room JW Marriott Phoenix Desert Ridge Resort & Spa on June 10, 2025, which expanded the portfolio’s reach in top meetings markets. Management invested approximately $182 million in the first half of 2025, primarily in its Hospitality business. These capital projects are designed to maintain the market competitiveness of Ryman’s core properties but led to temporary disruption and impacted results. Ongoing renovations at major hotels, including the completion of the Opryland Presidential ballroom, are expected to have an estimated $30–$35 million negative impact on operating income and Adjusted EBITDAre for FY2025 due to construction-related disruption.

The Entertainment segment leveraged the Grand Ole Opry brand, which spans live events, merchandise, and digital content. The Entertainment business benefited from strong demand for live experiences and investment in new venues—particularly through the Southern Entertainment acquisition and the Block 21 venue in Austin. However, EBITDA margins in the segment shrank from 37.9% to 23.7% year over year, as newly acquired festival businesses operate on lower near-term profitability and prior-year tax refunds were not repeated. In absolute terms, Entertainment operating income declined 9% (GAAP).

Hospitality faced competitive pressures, particularly in the group meetings space. Same-store Hospitality revenue slipped 1.6%, while same-store Hospitality operating income decreased 14.7%. Average daily rates (ADR) fell 0.6%, and revenue per available room (RevPAR) dipped 0.2% for same-store Hospitality. Both bookings and net definite group room nights contracted, down 14.6% and 16.7% respectively. Management cited increased competition in the Nashville hotel market and a shift in business mix as factors, along with absence of one-time tax benefits recognized in the previous year. Over 720,000 same-store Hospitality gross definite group room nights were booked for all future periods, which management characterized as healthy for the long-term pipeline, though “gross definite room nights booked” and “net definite room nights booked” dropped compared to last year.

The company operates under a strategic management agreement with Marriott, which oversees hotel operations and supports profit improvement plans. Ryman noted that it continued to execute $28 million to $30 million of profit improvement initiatives, focusing on labor analytics and operational efficiency during Q1 2025. However, these gains did not fully offset cost increases, renovation disruptions, and changes in customer mix that affected margins. Ryman kept its quarterly dividend at $1.15 per share, supporting its commitment to return at least 100 % of REIT taxable income to shareholders.

Look Ahead: Guidance and Investor Focus

Management revised its outlook for FY2025, raising the midpoint for consolidated Adjusted EBITDAre to $790 million (from $775 million) to reflect contributions from the newly acquired Desert Ridge resort. Nevertheless, Full-year net income available to common stockholders guidance was cut 9.5% to $222.8 million, with Adjusted Funds From Operations (FFO) per share lowered to $8.21 from a previous estimate of $8.55. Both downward adjustments reflect ongoing margin pressures—especially in Nashville—arising from supply growth and declines in transient rates. Forecasts for revenue per available room growth were unchanged at a midpoint of 2.5% for same-store RevPAR and 2.0% for Total RevPAR.

Ryman signaled continued focus on portfolio expansion, margin management, and brand diversification but acknowledged persistent short-term risks. The company expects construction interruptions and competitive supply in core markets to remain headwinds for the remainder of the year. The pipeline of future group bookings, particularly for 2026 and beyond, remains healthy. Investors are advised to keep an eye on how sustained margin pressure and the ramp-up of recent acquisitions affect overall profit trends, as well as the trajectory of group bookings and ADR through the second half of the year.

The quarterly dividend was maintained at $1.15 per share.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.