Inspirato Reports Record Q1 Profitability and Reiterates Full Year Guidance

Improved Gross Margins and Operational Efficiencies Drive Most Profitable Quarter in Company History

DENVER, May 07, 2025 (GLOBE NEWSWIRE) -- Inspirato Incorporated ("Inspirato" or the "Company") (Nasdaq: ISPO), the premier luxury vacation club and property technology company, today reported results for the first quarter ("Q1 2025") ended March 31, 2025. The Company delivered its most profitable quarter since going public, driven by strengthening gross margins and optimizing operational efficiencies. The Company also reiterated its full year 2025 financial guidance.

Q1 2025 Highlights

   -- Net income of $1.6 million and Adjusted EBITDA of $5.6 million, a 38% or 
      $1.5 million year-over-year Adjusted EBITDA improvement 
 
   -- Second consecutive quarter of positive Adjusted EBITDA, generating over 
      $7.5 million over trailing six months 
 
   -- Gross margin of 39% reflecting portfolio optimization and more efficient 
      business model 
 
   -- Cash operating expenses declined by $7.6 million, or 26% year-over-year, 
      reflecting a continued focus on operating efficiency 
 
   -- Maintained strong occupancy of 73%, with average daily rates ("ADR") 
      increasing 16% to $1,915 
 
   -- As of March 31, 2025, the Company reported approximately 11,600 active 
      memberships, reflecting its focus on high-quality, recurring revenue 

Management Commentary

Chairman and Chief Executive Officer Payam Zamani commented, "Our first quarter results reflect the impact of our disciplined transformation and the strong foundation we're building for long-term growth. We are focused on operational efficiency, brand elevation, and delivering enhanced member experience. We began the year with foundational technology investments, and in the second quarter we'll continue to work on what will ultimately become a world-class platform allowing us to reach, target, and convert high-value travelers at scale. We are transforming Inspirato into a leading property technology company in the luxury travel space, supported by a curated portfolio of high-quality homes. Every step we take is aligned with our goal of creating a financially strong enterprise, elevating the Inspirato brand, and delivering exceptional quality to our members."

2025 Guidance

   -- Anticipated Adjusted EBITDA of $0 to $5 million, a year-over-year 
      improvement driven by an expected 300 basis point expansion in gross 
      margins and other operational efficiencies 
 
   -- Cash operating expenses between $80 and $90 million, a 15% year-over-year 
      improvement. 
 
   -- Full year expected revenue of $235 to $255 million, in-line with 
      annualized fourth quarter 2024 revenue 

2025 First Quarter Earnings Call and Webcast

Company Chairman and CEO Payam Zamani and CFO Michael Arthur will host a conference call on Thursday, May 8, 2025 to discuss its 2025 first quarter operating and financial results.

To listen to the audio webcast and Q&A, please visit the Inspirato Investor Relations website at investor.inspirato.com. An audio replay of the webcast will be available on the Inspirato Investor Relations website shortly after the call.

Conference Call and Webcast

Date/Time: Thursday, May 8, 2025, at 1:00 PM ET / 11:00 AM MT

Dial-In (N. America): 1-833-630-1956 | Dial-In (International): 1-412-317-1837

Webcast: https://edge.media-server.com/mmc/p/xzdjiv6p

2025 First Quarter Financial Results and Operational Metrics:

The following table provides the components of gross margin for the three months ended March 31, 2025 and 2024:

 
                                        Three Months Ended 
(in millions other 
than percentages,      March 31,          March 31, 
unaudited)               2025               2024                % Change 
-------------------  -------------      -------------      ------------------ 
Residence and hotel 
 travel              $        38.3      $        44.2              (13.4)% 
Experiences and 
 bespoke travel                3.4                5.5              (37.2)% 
                      ------------       ------------ 
  Total Travel                41.7               49.7              (16.0)% 
Subscription 
 revenue                      20.9               28.1              (25.6)% 
Rewards and other 
 revenue                       3.3                2.5               30.6% 
                      ------------       ------------ 
Total revenue                 65.9               80.2              (17.9)% 
Cost of revenue               40.3               48.5              (16.9)% 
                      ------------       ------------ 
Gross margin         $        25.5      $        31.7              (19.5)% 
                      ============       ============ 
  Gross margin (%)              39%                40%                (1  )pp 
 

(n/m = not meaningful)

(pp = percentage points)

The following table provides a breakdown of Nights Delivered, Occupancy, and ADR for the three months ended March 31, 2025 and 2024:

 
                                   Three Months Ended March 31, 
                                      2025             2024 
                                   ----------  ---   ---------  --- 
Residences 
  Paid Nights Delivered                14,000           17,200 
  Total Nights Delivered               19,600           26,000 
  Occupancy                                74%              80% 
  ADR                           $       2,124       $    1,965 
 
Hotels 
  Paid Nights Delivered (1)             6,400            8,800 
  Total Nights Delivered (1)            9,500           15,300 
  Occupancy (2)                            67%              73% 
  ADR (1)                       $       1,414       $    1,053 
 
Total 
  Paid Nights Delivered (1)            20,400           26,000 
  Total Nights Delivered (1)           29,100           41,300 
  Occupancy (2)                            73%              78% 
  ADR (1)                       $       1,915       $    1,655 
 

(1) Includes net-rate hotel nights.

(2) Excludes net-rate hotel nights as we purchase individual nights but do not have a total number of nights obligation.

The following table shows our approximate total number of Active Memberships as of March 31, 2025 and 2024:

 
                               March 31, 
                             -------------- 
                              2025    2024 
                                     ------ 
Club                         10,200  10,900 
Pass                          1,300   2,100 
Invited                         100      -- 
                             ------  ------ 
  Total Active Memberships   11,600  13,000 
                             ======  ====== 
 
 

Reconciliation of Non-GAAP Financial Measures

In addition to Inspirato's results determined in accordance with GAAP, Inspirato uses Adjusted EBITDA, Adjusted EBITDA Margin and Free Cash Flow as part of its overall assessment of performance, including the preparation of its annual operating budget and quarterly forecasts, to evaluate the effectiveness of its business strategies and to communicate with its Board concerning our business and financial performance. Inspirato believes that these non-GAAP financial measures provide useful information to investors about its business and financial performance, enhance their overall understanding of our past performance and future prospects, and allow for greater transparency with respect to metrics used by its management in their financial and operational decision making. Inspirato is presenting these non-GAAP financial measures to assist investors in seeing its business and financial performance through the eyes of management, and because we believe that these non-GAAP financial measures provide an additional tool for investors to use in comparing results of operations of our business over multiple periods with other companies in our industry.

There are limitations related to the use of these non-GAAP financial measures, including that they exclude significant expenses that are required by GAAP to be recorded in Inspirato's financial measures. Other companies may calculate non-GAAP financial measures differently or may use other measures to calculate their financial performance, and therefore, our non-GAAP financial measures may not be directly comparable to similarly titled measures of other companies. Thus, these non-GAAP financial measures should be considered in addition to, and not as a substitute for or superior to, measures of financial performance prepared in accordance with GAAP and should not be considered as an alternative to any measures derived in accordance with GAAP.

Inspirato provides a reconciliation of Adjusted EBITDA, Adjusted EBITDA Margin and Free Cash Flow to their respective related GAAP financial measures. Inspirato encourages investors and others to review our business, results of operations, and financial information in its entirety, not to rely on any single financial measure, and to view Adjusted EBITDA, Adjusted EBITDA Margin and Free Cash Flow in conjunction with their respective related GAAP financial measures.

Adjusted EBITDA. Adjusted EBITDA is a non-GAAP financial measure that Inspirato defines as net income and comprehensive income less interest expense, net, income tax expense, depreciation and amortization, equity-based compensation, and gain on fair value instruments. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of total revenue for the same period.

The above items are excluded from Inspirato's Adjusted EBITDA measure because management believes that these costs and expenses are not indicative of core operating performance and do not reflect the underlying economics of Inspirato's business.

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