Q3 2024 Wyndham Hotels & Resorts Inc Earnings Call
Welcome to the Wyndham hotels, and resorts third quarter 2024 earnings conference call.
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Speaker Change: I'd now like to turn the call over to Matt <unk> Senior Vice President of Investor Relations. Please go ahead.
Matt: Thank you operator, good morning, and thank you for joining US with me today are Jeff <unk>, our CEO and Michele Allen, our CFO and head of strategy.
Matt: Before we get started I want to remind you that our remarks today will contain forward looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied these.
Matt: These risk factors are discussed in detail in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission and any subsequent reports filed with the SEC.
Matt: Significantly grew our ancillary fee streams year to date, we've generated over $265 million of adjusted free cash flow and we've returned nearly $380 million to our shareholders.
We sustained strong momentum on the development front opening over 17000 rooms, bringing our year to date total to more than 48000 rooms globally up 13% compared to a year ago. We.
Matt: We also improved our global franchisee retention rate by 40 basis points year over year.
Matt: Notably our franchise sales teams here in the United States signed at an impressive 10% more deals in the quarter than they did last year contributing to the 17th consecutive quarter of growth in our global development pipeline, which increased nearly 5% year over year to a record 248.
Matt: Rooms.
Matt: Domestically net rooms grew sequentially and year over year.
Matt: Driven by a solid 3% net room growth in our midscale and above brands with new conversions like the Wyndham Bloomington adjacent to the mall of America in Minnesota, and the Wyndham Garden, Louisville East near Churchill Downs, the home of the Kentucky Derby.
Matt: This quarter. We also opened our second new construction Echo suites hotel located in Plano, Texas, a fast growing technology hub, that's attracted economic investments such as the expansion of Plano is children's Medical center, the New Wells Fargo campus, which is expected to create over 4000, new jobs and the <unk>.
Matt: Growing presence of Toyota in North America in Frito Lay's corporate headquarters, we awarded another 10, new eco suites contracts this quarter in markets like Huntsville, Alabama, Greensborough in Raleigh, North Carolina, and Myrtle Beach, South Carolina, and we currently have over a dozen echo suites hotels under.
Matt: Construction across the country.
Matt: Echo suites owners are telling us that these hotels are performing ahead of their expectations and pro forma is the spartanburg property. The first echo suites to welcome guests last quarter reached stabilized occupancy levels of over 80% just weeks after opening while outperforming its competitive set in ADR.
Matt: Our South East Asia, and Pacific Rim region grew net rooms by 10% entering several new markets with luxury additions like the five-star Wyndham Pam Beall, but Tom in Indonesia, and the upscale lovey door hotel, a trademark collection resort adjacent to Samsung and Hyundai headquarters and the <unk>.
Matt: Tourism hub of lung sung <unk> South Korea.
Matt: In China, our direct franchising system grew 13% with new openings, including the Wyndham tie and west nestled at the foot of China's Wahoo mountain as well as a new la Quinta in Rennes wise booming business district, and another new La Quinta on Hainan Island.
Matt: Development activity across China remained robust increasing 6% with 37 direct franchise agreements awarded this quarter.
Matt: Bringing the region's direct franchise pipeline to nearly 400 hotels and a fee par 40% higher than that of our current China system.
Matt: Overall, we expanded our brand presence across the globe, adding five new brands to markets, where they hadn't existed previously.
Matt: <unk> the debut of the newly renovated luxury lifestyle Registry collection Hotel brand here in the United States with the historic mining Exchange Hotel in Colorado Springs.
Matt: The first Wyndham garden in Malaysia.
Matt: And the first Wyndham branded hotel inclusion, Romania, and the heart of Transylvania in the country's second largest city.
Matt: And importantly, these Q3 editions came into the system with a collective average fee par that is expected to be approximately 50% higher than the current system.
Matt: Now turning to Revpar in the United States Revpar declined 80 basis points this quarter compared to prior year, while economy Revpar continues to normalize up 260 basis points from the first half of this year, gaining 50 basis points of market share this quarter.
Matt: Ancillary fee growth strategy is the expansion of our suite of co branded credit card products.
Earlier this year, we launched Wyndham business aimed at streamlining the direct booking process for all types of business travel.
Matt: This initiative has gained significant traction driving a double digit year to date increase in our corporate contracted business from infrastructure related accounts.
Matt: In addition, our Wyndham rewards earned her business card has seen a 32% year over year increase in new accounts and a 70% lift in purchase volumes contributing to our ancillary fee growth this quarter.
Matt: We're also leveraging technology as part of Windows owner first commitment, which is at the very forefront of everything we do.
Matt: Our recently launched guest engagement platform Wyndham connect is an initiative that was made possible by our best in class technology stack with leading partners like Salesforce Sabre, Oracle and Amazon Adobe ideas and Canary Our technology platform enables personalized guest experiences to.
Matt: Boost franchisees' bottom lines, while improving guest engagement scores franchisees are now digitally and automatically without staff intervention upselling early check ins in late checkouts and Theyre also pre selling room upgrades and various in room amenities online before the guest checks in.
More than 4000 of our hotels in North America have adopted this platform with about 40% of those properties generating over $1500 in incremental monthly revenue.
Matt: As we furiously continue to implement guest facing AI tools and services, we're offloading labor intensive tasks from our franchisees were reducing their costs and we're increasing their bottom lines. While at the same time, allowing them to focus on guest service and guest satisfaction.
Matt: Be related and other revenues increased 3% driven by a 5% increase in royalties and franchise fees and 8% growth in ancillary revenues.
Matt: The increase in royalties and franchise fees reflects our global system growth expansion of our domestic international and global royalty rates driven by our higher fee part growth strategy and hiring other franchisee.
Matt: Our ancillary revenue growth was primarily driven by higher credit card and partnership fees as well as increased license fee.
Matt: This growth continues the trend from the first half of this year, where these fee streams meaningfully outperformed industry revpar level.
Matt: Looking ahead, we have exciting new opportunities on the horizon that will build on our momentum and further enhance these ancillary fee stream.
Matt: Adjusted EBITDA grew 7% on a comparable basis, primarily reflecting our higher royalty and franchise fees and increased ancillary revenues as well as margin expansion, which was largely driven by operational improvements this quarter.
Matt: Third quarter adjusted diluted EPS was $1 39 up 10% on a comparable basis, reflecting our adjusted EBITDA growth as well as the benefit from our share repurchase activity. These benefits were partially offset by higher interest expense.
Matt: Adjusted free cash flow was $96 million in third quarter and $267 million year to date with a conversion rate from adjusted EBITDA of 51%.
Matt: We continue to expect full year adjusted free cash flow to convert at approximately 60% of adjusted EBITDA at our current trading levels, our adjusted free cash flow yield of over 6% continues to lead the lodging sector.
Matt: Our capital allocation strategy remains unchanged. Our first preference is to invest in the business balancing organic growth opportunities with disciplined M&A activity. While we remain focused on pursuing transactions that are accretive from both an earnings and net room growth perspective, as well as additive to chain scales underrepresented.
Speaker Change: Positive trends as Jeff mentioned in our infrastructure related business.
Speaker Change: Even though this ship doesn't occur until the last 10 days of October month to date through the first three weeks U S. Revpar is trending up 3% year over year and the comps only get easier from here.
In closing our third quarter results reflect strong execution across our strategic priorities from steady system expansion and expanding royalty rates to ancillary fee growth and disciplined capital allocation, we remain confident in our ability to create sustainable value as we capitalize on the best investment opportunities to deliver meaningful returns.
Speaker Change: For our shareholders with a robust pipeline and Revpar green shoots, particularly on the infrastructure side. We are excited about the opportunities ahead and look forward to building on this momentum as we close out the year and move into 2025 with that Jeff and I would be happy to take your questions operator.
Speaker Change: The floor is now open for questions.
Speaker Change: At this time, if you have a question or comment please press star one on your telephone keypad.
Speaker Change: If at any point. Your question has been answered you may remove yourself from the queue by pressing star two.
Speaker Change: Again, we do ask that you limit yourself to one question and one follow up thank you.
Speaker Change: Our first question will come from Joe Greff with JP Morgan. Please go ahead.
Joe Greff: Good morning, everybody.
Joe Greff: Right.
Joe Greff: Jeff I just wanted to get a question about how you're thinking about net rooms growth for next year. How confident are you that next year's room growth rate could exceed what you end up.
Joe Greff: Doing this year and then when you think about the composition from a brand and a geography perspective.
Joe Greff: Echo would be stronger next year I would think then this year. How is next year's net rooms growth composition different than what we've seen in the last couple of years.
Speaker Change: Are the benefits, we're seeing from the hurricane the most recent hurricanes there was no material impact in the third quarter given it only impacted the last week of September but as we moved into October we have seen a much larger impacts with occupancy up over 10%.
Speaker Change: Any impacted states right now its already a 40 basis point benefit to our fourth quarter Revpar for our fourth quarter Revpar and there is potential for more depending on the duration of the relief efforts, which as we all know are ongoing but remember when you weight that fourth quarter impact.
Speaker Change: The 40 basis point or translates to probably about 10 basis points on a full year basis at the global level. So I'm. So it would be it's going to be additive, but you know what it's going to be it's not going to be materially different than what's currently are with <unk>.
Speaker Change: Current outlook implies.
Speaker Change: Thank you.
Speaker Change: Thank you. Thank you. Thank you. Our next question will come from Stephen Grambling with Morgan Stanley. Please go ahead.
Stephen Grambling: Hey, Thank you so on slide six of the deck you have the 2026 walk on EBITDA and I know you mentioned confidence in the 3% to 5% net room growth sounds like Revpar building back to that 2% to 3% range, but would love to get a scorecard of where you feel youre running ahead, where you maybe behind on this trend line for some of the.
Stephen Grambling: The other buckets that there's any other factors to consider for 2025 just might impact.
Stephen Grambling: You know that that March to the 2026 number.
Speaker Change: Well, that's a loaded question, let me start by saying, we're very confident in.
Speaker Change: And the driver assumptions out on page six, particularly with respect to system growth and continued retention improvement.
Speaker Change: David Katz with Jefferies. Please go ahead.
Speaker Change: Yeah.
David Katz: Good morning, everyone. Thanks for all the detail and for taking my question.
David Katz: Firstly I just wanted to go a little farther I know Michel you talked about some of the.
David Katz: Comp benefits that work your way in for Q1 of your peers talked yesterday about leisure for 25 flat or maybe a little down and I know that that's an important part, but not all leisure is created equal.
David Katz: If you all could just talk about what your kind of leisure expectation is broadly and how that relates to your system.
David Katz: Good place to start.
Speaker Change: Yeah, we look.
Speaker Change: If leisure demand were to wane in any way and we're not seeing that.
Speaker Change: We're certainly the beneficiaries as we've been in the past our brands have always significantly outperformed the broader lodging market, David as we've talked about and slowdowns, but we are not seeing any significant softness or any trade down as those gaps between the chain scale continue to strengthen I mean think about it there is no signs yet of any discount.
Speaker Change: Our compression there hasnt been.
Speaker Change: That $50 gap between the economy segment and the upper mid scale segment. Our ADR has now increased to 60.
Speaker Change: At $70 gap between the upper Midscale and upper upscale has now grown to 80.
Speaker Change: And all the leading indicators, we look at remain positive our booking windows continue to tick up 5% to last year year to date from 16 to 17 days now we're seeing longer lengths of stay we're seeing credit card data spending for September up 200 basis points.
Speaker Change: And leisure travel sentiment continuing to improve among these everyday blue collar workers, who are more employed their wages and savings are higher.
Speaker Change: It's creating a very resilient employment backdrop, and it's driving very strong disposable personal income where they've they've shifted their priorities when coupled with if if interest rates do come down lower mortgage payments and moderating our central spending should drive the improvement in cash flow for our consumers to vacation.
All of the all of the worry around a D D.
Speaker Change: The the the normalization I mean, we are seeing things improve were right on trend, we're seeing continued growth momentum.
Speaker Change: Economy Revpar continues to normalize each quarter of 2024 has improved in an economy Q2 is better than Q1 Q3 was better than Q2 and economy. Revpar is a full point ahead of the overall domestic revpar growth two to 2019 so.
Speaker Change: Pricing power is strong it's still trailing inflation, we're up I think 17% to 19 versus 23% and we think pricing power could continue to be flex for our franchisees and as Michelle said when we look at quarter to date for the first three weeks economy being up 330 basis points and mid scale I think it was up 450 basis point.
Speaker Change: Coupled with a more favorable year on year comparable not only for Q3, but for the next four quarters.
Speaker Change: It looks like a U S versus international Thank you.
Speaker Change: Sure Yeah.
Speaker Change: We were really pleased with the progress we've made on retention, but thus far and we do we do expect to continue to improve it you can see steady improvement over over a number of years now and it really is reflective of or increasing value proposition as well.
Speaker Change: Well as are our owner first philosophy, we've always said, 96% was kind of the first stop on maybe the first base.
Speaker Change: Around and and there's room once we get there to continue to push higher in terms of the breakout on the timing, but I'd say of terminations is dependent upon many many factors, including contractual terms notice periods.
Tours on defaults, all all of those things and and some culling of the system is necessary from time to time, especially as we bring in higher value properties. So while retention remains a priority across our portfolio. We don't measure it quarterly it's measured over time and our focus is.
Speaker Change: She has been on improving our global retention rate, we've made great progress on.
Speaker Change: On that front domestically our primary focus is on overall net room growth again, especially as we continue to push into these higher value segments Bank. This is the 13th consecutive quarter now we've seen positive growth in the U S. Our teams are really proud of that and.
Speaker Change: Especially in what has been a limited new supply market.
Speaker Change: Thank you.
Speaker Change: I guess, just a bit of a follow up.
Speaker Change: We do think about blended 96.
Speaker Change: Roughly pension right.
Speaker Change: Does that percentage breakout.
Speaker Change: U S versus international if you can share that.
Speaker Change: I don't.
Speaker Change: From an outlook perspective, we definitely don't guide to that level.
Speaker Change: Ciao.
Speaker Change: Oh, I'm, sorry, not not a guide, but where are you currently at.
Speaker Change: We're currently at 95, 7% Patrick our attention on a global basis was up 40 basis points and you know.
Speaker Change: Our teams I think the most important thing to Michelle's point Theyre successfully swapping these lower value termination rooms for higher value new rooms.
Speaker Change: I mean for example, the double digit net room growth that we saw over in Asia Pacific as it's coming in at three times the license fee.
Speaker Change: Since spin we've been able to you know move that 90 394 to $95 96 to over the last 12 months, which is how we look at this globally you know another 40 basis points to 95.7%.
Speaker Change: Okay. Thank you.
Speaker Change: Thanks, Patrick.
Speaker Change: Our next question will come from branch Montador with Barclays. Please go ahead.
Speaker Change: Hum.
Speaker Change: Good morning, everybody.
Speaker Change: Wanted to double click on that on the hurricane.
Speaker Change: Impact in and obviously no ones you know rooting for these for this relief effort to drag on or.
Speaker Change: Some more.
Speaker Change: Agreed as from here, but just objectively speaking if you could compare.
Speaker Change: This hurricane season, and the devastation with with the aftermath of the 2017.
Speaker Change: Hurricanes, Harvey and Irma and the reason I ask is because those relief.
Speaker Change: Relief efforts trail.
Speaker Change: Trailed into all the way into the second quarter of 2018, and you had a pretty large lift related to that in the order of two to 300 basis points in the U S. So maybe you could just help us sort of understand compare contrast, the two situations.
Yeah, absolutely and you're 100% right our select service hotels.
Speaker Change: They do provide a vital role in accommodating displaced families and an emergency workers and and so.
Speaker Change: The impact on Revpar can vary significantly depending on the storm scale and then our footprint any affected.
Speaker Change: And here, we had about 500 hotels that were impacted but we only have one hotel that currently remain closed.
Speaker Change: Super eight and in Ashville so.
Speaker Change: The hotels are open operating and they're accepting emergency crews and displaced families and that's really that increased demand is really what's driving the 40 basis points I discussed earlier, if you look specifically at 2017, we had two major hurricanes hit on our two largest.
Speaker Change: Foot print States, Florida, and Texas, and we did see.
Speaker Change: We did see a two to 300 basis point impact over a two to three quarter period, but in other cases. Many other cases the impacts are not nearly as large and are much shorter duration typically in the range of 50 to 100 basis points for one quarter only.
Speaker Change: You know, it's FEMA has deployed 9000.
Speaker Change: 9000 personnel into the impacted region, we've got.
Speaker Change: Over 100 hotels right now that are running occupancy month to date greater than 90%. So we are seeing.
Speaker Change: Lot of a lot of our hotels are filled.
Speaker Change: Built with with crews and lots of large pieces of business.
Speaker Change: Yesterday, there was a half a million dollars booked for one specific vendor and so that new business coming in today. So we do think there is going to be continued benefit. It's just really hard to say how long.
Speaker Change: How long that's going to last for.
Speaker Change: Okay. That's super helpful. Thanks Michele.
Speaker Change: And then a follow up question yesterday Hilton.
Speaker Change: Called out a greater impact from the election in November than they had originally expected.
Speaker Change: I assume that they would presumably they were talking about group and in group doesn't really.
Speaker Change: It doesn't affect you guys, but we have heard other.
Speaker Change: Smaller operators in different industries call out.
Speaker Change: Swing state, specifically election, distraction sort of keeping people at home and making them depressed with all the commercials and whatnot I was curious Jeff for Michele if there isn't I don't I know you don't have the visibility for Oh, no. We're getting to the point, where you probably do with visibility any any sort of.
Speaker Change: Distraction on sort of leisure traveler or anything do you think might be keeping people at home that you're sort of baking in.
Speaker Change: I would say because you referenced a hilton specifically I would just say there are a number of.
Speaker Change: A number of different dynamics between our business, particularly in the fourth quarter and what we're going to see and some of these some of these more business oriented brands and the impact of the presidential election is we're expecting to be to be won one of those differences.
Speaker Change: So it's coming up in a few weeks it often reduces not just group and conference business, but overall corporate travel, but our business traveler is wearing hard hats and worked out so we're not expecting it to have.
Speaker Change: They have I typically would not have an impact on our business now this is not a typical election.
Speaker Change: So it still remains to be seen the second is that Christmas holiday period, where again, you're going to see tighter business travel windows, but but longer leisure travel windows. So so that's going to be a favorable shift for us in the fourth quarter or may be unfavorable for them for the first time of the peers.
Speaker Change: Perfect. Thanks, everyone.
Speaker Change: Thanks Brent.
Speaker Change: Yeah.
Speaker Change: Our next question will come from Lizzie Dove with Goldman Sachs. Please go ahead.
Lizzie Dove: Hi, Thanks for taking the question.
Lizzie Dove: Sounds like you are seeing some really nice green shoots in the economy segment in the fourth quarter is a chain scale that has been a laggard curious to what extent you have seen any impact from some of the newer brands in the premium economy segment, taking any share you know something like a spark for example, or especially with the improvements you've seen do you see those challenges in an economy over the loss.
Lizzie Dove: 18 months is more kind of cyclical on a function of comps.
Speaker Change: Yeah, I'd say more cyclical and a function of comp I mean, it's been two years and really none of the new brand launches out there.
Speaker Change: It had been slowing or NRG or are accelerating development pipeline, especially in the midscale and above segments that are really these brands are playing and according to Smith travel.
Speaker Change: And where we've been able to accelerate our domestic midscale and above net room growth to plus 3% literally over the last several quarters since their introduction.
Speaker Change: And we don't view the reflagging of.
Speaker Change: The handful I think it's 10 of our over 9200 hotels is incremental in any way to our our normal term activity.
Speaker Change: That's helpful. Thank you and then just one follow up on China, which I guess is a decent chunk of your international rooms, We obviously got the stimulus announcement last month or so how does that change your outlook at all does that is that something you think can have a meaningful impact.
Speaker Change: For China in 2025.
Speaker Change: Yeah, I don't think title IV I don't think it changes our outlook it definitely makes it a little bit easier, but we'd always been expecting continued.
Speaker Change: Continued recovery in China, and and that that view has not changed just feel a little bit more confident in it with the with the stimulus coming in.
Speaker Change: Got it thank you.
Speaker Change: Thank you.
Speaker Change: Our next question will come from Steve <unk> with Deutsche Bank. Please go ahead.
Speaker Change: Hey, good morning, everyone.
Steve <unk>: On development I believe slide 15 noted net rooms growth pacing ahead of historical performance is that just a pull forward of new rules, where should we expect to see historical seasonal in that room adds in the <unk> This year.
Speaker Change: Yeah.
Speaker Change: Yeah. So we are I think were pacing well ahead of where we were last year. We were at 70% I think last year, we were about 50%.
Speaker Change: And the teams have been really productive bringing in deals earlier in the year, but with respect to the fourth quarter I would say some of our in our international teams had pretty large quarter of pretty large quarters, bringing in some monster opens and until we do think this fourth quarter will be a bit low.
Speaker Change: Sure than it was last year.
Speaker Change: As a lot of those openings are already captured in the year to date, but full year will be up and we remain confident in our ability to deliver in line with expectation.
Speaker Change: Okay. Thank you then margins continuing to show solid year over year growth extra marketing spend what is driving the expansion from a cost control perspective.
Speaker Change: Is there any margin benefits embedded into 2026 algorithm.
Speaker Change: How should we think about margins going into next year.
Speaker Change:
Speaker Change: Yes, so so what's driving the margin benefits right now are and our ancillary revenue growth and efficiencies, we're gaining there some of them some of the.
Speaker Change: <unk>, we have from an organizational perspective, when we combine our.
Speaker Change: When we traded our commercial organization and then some AI and technology enhancements that we've been deploying and they back and.
The backhouse.
Speaker Change: The business all of those are contributing to the margin impact also on a year to date basis and on a full year. We did have we did have about $4 million of insurance proceeds that had a small benefit to the margin.
Speaker Change: Excluding that insurance benefits the rest of the margin will step moving forward into.
Speaker Change: Into 2025 mm and.
Speaker Change: And and then with respect to where the margin will be for 2025 hard to say until we get through our budgeting process.
Okay. Thank you.
Speaker Change: Thank you.
Speaker Change: Our last question will come from Meredith Jensen with HSBC. Please go ahead.
Meredith Jensen: Good morning, Thank you.
Meredith Jensen: Quickly on the technology front I know you spoke quite a bit about your advantage being cloud based versus competitors, who may have to rebuild that tech stack to get there I was wondering if you have kind of any internal targets on the merchandising front like how many how many bookings my might add on some of those.
Meredith Jensen:
Meredith Jensen: Build a room options I I do think we got one of their competitors was saying I'm currently they have low teens percentage of bookings that that have some of those additions. So I was wondering if you have any sort of metrics, we could we could follow on that.
Meredith Jensen: Yeah.
Meredith Jensen: I think.
Meredith Jensen: Meredith the you know.
Meredith Jensen: The investments that we've made over the last six years, which is really laid the foundation for US a 300 million dollar investments and spend our and our industry leading tech stack is.
Meredith Jensen: What is really helping us drive from a direct contribution standpoint, and a wyndham reward standpoint, so much of so much of our success I mean, we're seeing.
Meredith Jensen: Record enrollment in our in our loyalty program, which is driving a member occupancy up 240 basis points.
Meredith Jensen: Q3.
Meredith Jensen: And is now.
Meredith Jensen: 50% over one out of every two check ins directly for our for our guests to our franchisees are coming through our technology stack and and that's really important it's an all time high for for any.
Meredith Jensen: Any Q3 that we've had a it's up 600 basis points to where we were in 2019 are where we're going to continue to invest in our technology stack, we're going to continue to up to as we said furiously.
Meredith Jensen: Execute and implement and speed up all aspects of the operation for our franchisees, which is really reducing the labor load on their front desks and it's it's it's our ability to to allow those hotel teams to interact directly with the guests that are.
Meredith Jensen: Through our automation of all of the manual processes and seamlessly offering that are that that early check in and late checkout. That's that's also helping drive our net room growth. It's one of the biggest.
Meredith Jensen: Points of differentiation our franchise sales teams belief when they're out there selling our value proposition versus our competitor and so we we're huge believers, we're big partners with with Salesforce, Marc Benioff on CNBC Mad money I don't know if you saw it but Matt could send you the clip talked about how our technology and digital.
Meredith Jensen: Teams are.
Meredith Jensen: Our are really innovating I mean, coupled with with sales forces data cloud. We are we're amalgamating the data we're delivering a level of automation that is Mr. Benny offset has never been envisioned and we're taking that ebb and flow with the manual tasks and the customer demand and automating every customer touch point that we can.
Meredith Jensen: Really supercharging, our our 360 strategy with our data and building a much stronger data cloud and we think the opportunities ahead for us are endless.
Speaker Change: Oh, that's awesome. Thank you one very quick addition on the important ancillary fees just to dig in a little bit more you mentioned that the business card had this incredible 70% jump year over year in spend with them is that a sort of will you be able to provide some of those trends.
Speaker Change: Going forward and some of the breakdown of of ancillary growth that we can sort of look to going forward.
Yes.
Speaker Change: Okay.
Speaker Change: Go ahead go ahead, Michelle with both.
We are very there there's a lot to be excited about here.
Speaker Change: I'd say you know our credit card program will be the largest contributor to our ancillary fee growth and it has been in 24 will be likely in 'twenty five.
Speaker Change: Growth here is accelerating due to a number of initiatives, which helped to generate higher card holders as well as higher purchase volumes one of those is.
Speaker Change: When the business that we that Jeff discussed and has that in his prepared remarks that there are many opportunities to enhance our marketing and.
Speaker Change: And reach a broader base of consumers to increase the number of cardholders Theres also a new product opportunities in international expanse.
Speaker Change: Expanse expansion Wyndham business itself is just ramping now so we're expecting to see them.
Speaker Change: Not just the increased card holders, there, but the elevation and and purchase volumes out outside of the credit card. We've got our blue thread with the P&L that I'm continuing to drive higher license fees. There, we know that consumers value the Wyndham rewards currency and we're looking to capitalize.
Speaker Change: Upon that in strategic partnerships and then the investments that Jeff mentioned about mentioned in our back end and on property technology. Those are presenting incremental opportunities not just for our franchisees who are 40% of owners that are engaged and opted in.
Speaker Change: To.
Speaker Change: To Wyndham connect are seeing $500 a month in incremental revenue that's sizable for them, but where earnings were earning a portion of that of that as well. So there are numerous opportunities here or other things that we're working on that we're not talking about and we're really excited about.
Speaker Change: All of the progress we're making on on this front and we will continue to update them.
Speaker Change: As we have more to talk about.
Awesome. Thank you so much.
Speaker Change: Thanks, Meredith and thank you.
Speaker Change: Thank you at this time I would like to turn the floor back over to Jeff <unk> for closing remarks, well, thanks, Scott and thanks to everyone, who is still with US we're sorry for going over but we appreciate everyone's interest in Wyndham hotels and resorts.
Speaker Change: Certainly, Michelle and and I and Matt look forward to talking to them and seeing many of you in the weeks ahead at so many of the upcoming investor conferences that we'll be attending in the meantime have a great weekend ahead and happy Halloween everyone. Thanks again for joining us today.
Speaker Change: Thank you. This does conclude today's Wyndham hotels <unk> resorts third quarter 2024 earnings Conference call. Please disconnect. Your line at this time and have a wonderful day.
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