Summarize this content to 2000 words in 6 paragraphs
Skift Take
Vacasa’s weaknesses were apparent well before the vacation rental market turned soft. Now, they’re even tougher to fix.
Dennis Schaal
Vacasa was managing 40,000 homes at the end of the second quarter, 4,000 fewer than a year earlier, as owners express displeasure with rates and revenue, as well as with owner-company communications.
That was the word from Vacasa officials Thursday as they commented during the company’s second-quarter earnings call on the 9% drop year-over-year in homes under management.
Vacasa’s share price was down 37% to around $2.47 in late morning trading on Nasdaq Friday.
The company reported a softening of the market for domestic vacation rentals.
“These ongoing trends are continuing to put real pressure on our business,” CEO Rob Greyber told analysts. “Nonetheless, based on our and industry data, we continue to believe in the significant majority of our markets. Vacasa listings are generating more gross bookings per home than the industry, so while the industry booking trends remain challenging, we are focused on what we can control.”
Still, Vacasas’s gross bookings value overall in the second quarter fell 19% to $505 million.
Vacasa Is Going Local
To address owner concerns, Vacasa began reorganizing the business in May, ceding more power to local teams to make decisions about onboarding new customers and revenue management, for example, in the hope of moving faster, avoiding duplicative efforts, and easing relations with home owners.
Vacasa announced it closed on $30 million in senior secured convertible notes with Davidson Kempner Capital Management, which got two seats on an expanded board of directors, to improve the balance sheet. There is an option to issue another $45 million in convertible notes.
Vacasa’s net loss widened in the second quarter to $13 million, compared with a $6 million loss a year earlier. Revenue in the second quarter fell 18% to $249 million.
Vacasa didn’t provide an outlook for the rest of the year but said it doesn’t expected to be profitable on an adjusted EBITDA basis in 2024.
