Vail Resorts (NYSE:MTN) said historically poor weather across the Western United States continued to weigh on fiscal third-quarter results, pressuring visitation and revenue at its mountain resorts while management emphasized that its advance commitment pass model and cost controls helped cushion the impact.
On the company’s fiscal third-quarter earnings call, Chief Executive Officer Rob Katz said the season was “very challenging,” particularly at destination resorts in the Rockies, which he said experienced the “worst season on record for snowfall.” Katz said industry-wide visitation in the Rockies declined approximately 24%, compared with a prior worst decline of 8% in 2012 outside of COVID-related closures.
Weather Pressures Revenue and Visitation
Management said resort revenue for the quarter declined 7% from the prior year, primarily due to unfavorable weather that affected both local and destination guests, especially in the Rockies and Tahoe. Lift revenue declined 5%, despite total visitation being down 15%, as North American pass sales had increased 3% entering the season.
Resort EBITDA for the quarter fell 9%. Management said the decline was partly mitigated by Vail Resorts’ advance commitment model, cost discipline and geographic diversity.
The company said North American pass visitation declined 17% over the winter, while lift ticket visitation declined 10%. In the Rockies, snowfall for the winter finished 55% below the 30-year average, management said.
Despite the difficult operating environment, Katz said the company achieved record guest experience scores, including year-over-year increases at every resort in the Rockies. He also pointed to full staffing for the third consecutive season, strong seasonal employee retention, high employee engagement scores and a decline in employee injuries per labor hour.
Guidance Cut to Reflect Late-Season Weakness
Vail Resorts updated its full-year outlook, saying it now expects net income attributable to the company in the range of $128 million to $162 million and Resort Reported EBITDA of $735 million to $755 million. Management said the Resort EBITDA midpoint is now at the bottom of the range provided in March, consistent with an April update.
The company said the revised forecast reflects the continuation of historically challenging conditions through March and April, which further pressured late-season visitation.
Management also lowered expected cash taxes to a range of $75 million to $85 million, citing the reduction in earnings.
Vail Resorts said it remains on track to exceed its initial two-year Resource Efficiency Transformation Plan target of $100 million, with expectations to achieve $106 million of annualized efficiencies by the end of the year. The company also said it remains on track to deliver an additional $30 million of savings in fiscal 2028.
Management said the company ended the quarter with approximately $1.1 billion in liquidity and net leverage of 3.5 times trailing 12-month EBITDA. It reaffirmed plans for approximately $215 million to $220 million in core capital spending and $234 million to $239 million in total capital investments.
The company maintained its quarterly dividend at $2.22 per share and said it has repurchased approximately $45 million of shares year-to-date.
Pass Sales Decline After Difficult Season
Spring pass sales were down 10% in units and down 5% in sales dollars including tax through the May deadline. Pass days sold were down approximately 8%, reflecting a higher mix of unlimited products.
Katz said the decline was not surprising given the severity of the season and the significant pass growth Vail Resorts had achieved over the prior five years, particularly in frequency products.
Management said weakness was most pronounced in weather-impacted destination markets, including Colorado, Utah and Lake Tahoe, as well as among destination guests who typically travel to the Rockies. Those areas saw low double-digit unit declines. By contrast, pass unit declines were in the low single digits in Eastern U.S. markets and at Whistler Blackcomb.
The company said its core high-value unlimited pass products are outperforming frequency products. A new young adult product also performed ahead of other age groups, though Katz said it was “not something that is going to drive our overall results for the year” and is instead a mitigator to other declines.
Katz said third-party data suggests Vail Resorts’ spring pass performance outpaced the broader industry, which he attributed to the company’s new marketing and product strategies. He said a portion of the decline may reflect delayed purchase decisions rather than reduced intent to ski next season.
Lift Ticket Strategy Shows Early Signs of Traction
Katz said the company made changes heading into the season to focus on driving lift ticket visitation. These included expanded Epic Friend Tickets, which offer a 50% discount, and Super Advanced Lift Tickets, which offer a 30% discount for purchases made a month in advance.
Visitation from benefit tickets increased 10%, despite a 10% decline in overall lift ticket visitation, Katz said. The company also saw a 65% increase in tickets sold more than 28 days in advance, with no evidence of material cannibalization of other advanced ticket products.
Katz said Vail Resorts’ U.S. lift ticket visitation declined 12%, while the rest of the industry was down approximately 20%, based on preliminary data. In the Northeast, where conditions were stronger, Vail Resorts’ lift ticket visits increased 8%, compared with an estimated 8% decline for the rest of the industry.
During the question-and-answer session, Katz said if some consumers do not buy passes and instead purchase lift tickets, the company’s overall effective ticket price would rise. However, he emphasized that Vail Resorts still wants guests in the advance commitment category.
Management Plans for Normal Conditions Next Season
Asked whether the current pass sales trend changes the company’s planning for next season, Katz said it does not. He said management is planning for a normal season with normal conditions and does not intend to pull back on guest experience investments.
“Right now, there’s no change in our planning for next season,” Katz said.
Management said U.S. ski market data suggests visitation typically fully recovers after poor-condition seasons when the subsequent season has normal conditions. Katz said Vail Resorts is positioned to capture such a recovery through its pass, lift ticket and marketing strategies, though he acknowledged the season’s conditions were unprecedented.
The company also highlighted initiatives aimed at improving the guest experience, including investments in lifts, snowmaking, terrain, technology, My Epic Gear, ski school digitization and dining. Katz said fiscal 2027 will be a transition year for My Epic Gear, with a fuller experience expected in fiscal 2028.
In closing, Katz said the difficult season “sharpened our focus” on improving the end-to-end guest experience, from marketing and products to the on-mountain experience.
About Vail Resorts (NYSE:MTN)
Vail Resorts, Inc is a leading mountain resort company that owns and operates an integrated network of ski areas, hotels, restaurants and retail outlets. The company’s signature Epic Pass program offers skiers and snowboarders season‐long access to its portfolio of resorts, while ancillary services such as ski and snowboard schools, equipment rental and retail drive additional revenue.
Headquartered in Broomfield, Colorado, Vail Resorts was formed in 1997, building on the legacy of Vail Associates, which opened the Vail ski area in 1962.
