Service Properties Trust | 10-Q: FY2025 Q3 Revenue Misses Estimate at USD 478.77 M

Revenue: As of FY2025 Q3, the actual value is USD 478.77 M, missing the estimate of USD 481.1 M.

EPS: As of FY2025 Q3, the actual value is USD -0.28, missing the estimate of USD -0.245.

EBIT: As of FY2025 Q3, the actual value is USD 132.85 M.

Hotel Segment

• Revenues: Hotel operating revenues were $377.6 million for the three months ended September 30, 2025, a decrease of 3.4% from $390.9 million in the same period in 2024.
• Expenses: Hotel operating expenses were $328.4 million, a slight decrease of 0.1% from $328.5 million in the same period in 2024.
• Depreciation and Amortization: Depreciation and amortization were $40.3 million, a decrease of 23.6% from $52.8 million in the same period in 2024.
• Net Loss: The hotel segment reported a net loss of $46.9 million, unchanged from the same period in 2024.

Net Lease Segment

• Revenues: Rental income was $101.2 million, an increase of 1.0% from $100.2 million in the same period in 2024.
• Expenses: Net lease operating expenses were $5.2 million, an increase of 9.3% from $4.8 million in the same period in 2024.
• Depreciation and Amortization: Depreciation and amortization were $34.2 million, a decrease of 5.8% from $36.2 million in the same period in 2024.
• Segment Profit: The net lease segment reported a segment profit of $47.2 million for the three months ended September 30, 2025.

Cash Flow

• Operating Cash Flow: Net cash provided by operating activities was $136.3 million for the nine months ended September 30, 2025, compared to $149.0 million for the same period in 2024.
• Free Cash Flow: Not explicitly stated, but net cash provided by investing activities was $123.2 million for the nine months ended September 30, 2025, compared to net cash used in investing activities of $180.1 million for the same period in 2024.

Future Outlook and Strategy

• Core Business Focus: The company is focused on reducing debt, transitioning to a company with the majority of its properties being service-focused retail net lease properties, and improving the performance of the hotels it expects to retain after completing the sale of its previously announced dispositions.
• Non-Core Business: The company plans to sell 69 hotels with a total of 8,695 keys for a combined sales price of $567.5 million, excluding closing costs, and is marketing for sale one hotel with 122 keys.