Hospitality company Travel + Leisure (NYSE: TNL) met Wall Street’s revenue expectations in Q1 CY2026, with sales up 2.9% year on year to $961 million. Its non-GAAP profit of $1.45 per share was 10.5% above analysts’ consensus estimates.
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Travel + Leisure (TNL) Q1 CY2026 Highlights:
- Revenue: $961 million vs analyst estimates of $956.5 million (2.9% year-on-year growth, in line)
- Adjusted EPS: $1.45 vs analyst estimates of $1.31 (10.5% beat)
- Adjusted EBITDA: $225 million vs analyst estimates of $215.4 million (23.4% margin, 4.4% beat)
- EBITDA guidance for the full year is $1.04 billion at the midpoint, in line with analyst expectations
- Operating Margin: 16.5%, in line with the same quarter last year
- Free Cash Flow Margin: 2%, down from 10.7% in the same quarter last year
- Tours Conducted: up 8,000 year on year
- Market Capitalization: $4.75 billion
Company Overview
Formerly known as Wyndham Destinations, Travel + Leisure (NYSE: TNL) is a global vacation company that provides travelers with vacation ownership, exchange, and travel services.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last five years, Travel + Leisure grew its sales at a 12.7% annual rate. Though this growth is acceptable on an absolute basis, we need to see more than just topline growth for the consumer discretionary sector, which can display significant earnings volatility. This means our bar for the sector is particularly high, reflecting the non-essential and hit-driven nature of the products and services offered. Additionally, five-year CAGR starts around Covid, when revenue was depressed then rebounded.
We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new property or trend. Travel + Leisure’s recent performance shows its demand has slowed as its annualized revenue growth of 3.4% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. 
We can dig further into the company’s revenue dynamics by analyzing its number of tours conducted, which reached 161,000 in the latest quarter. Over the last two years, Travel + Leisure’s tours conducted averaged 2.7% year-on-year growth. Because this number aligns with its revenue growth during the same period, we can see the company’s monetization was fairly consistent. 
This quarter, Travel + Leisure grew its revenue by 2.9% year on year, and its $961 million of revenue was in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 2.6% over the next 12 months, similar to its two-year rate. This projection is underwhelming and implies its newer products and services will not lead to better top-line performance yet.
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Operating Margin
Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes.
Travel + Leisure’s operating margin has been trending down over the last 12 months and averaged 16.4% over the last two years. The company’s profitability was mediocre for a consumer discretionary business and shows it couldn’t pass its higher operating expenses onto its customers.
In Q1, Travel + Leisure generated an operating margin profit margin of 16.5%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Travel + Leisure’s EPS grew at 73.3% compounded annual growth rate over the last five years, higher than its 12.7% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
In Q1, Travel + Leisure reported adjusted EPS of $1.45, up from $1.11 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Travel + Leisure’s full-year EPS of $6.73 to grow 13.9%.
Key Takeaways from Travel + Leisure’s Q1 Results
It was good to see Travel + Leisure beat analysts’ EPS expectations this quarter. We were also happy its EBITDA outperformed Wall Street’s estimates. On the other hand, its EBITDA guidance was just in line. Investors were likely hoping for better EBITDA guidance given the strong EBITDA performance in the quarter, and shares traded down 3% to $73.90 immediately after reporting.
So do we think Travel + Leisure is an attractive buy at the current price? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).
