Ashford Posts AFFO Loss of $2.22 per Share Despite Returning to Profitability
Key Facts
Ashford Hospitality Trust reported results on November 10 for the third quarter ended September 30, 2026, posting an adjusted funds from operations (AFFO) loss of $2.22 per diluted share, compared with a loss of $2.85 a year earlier. The company said the quarter's results reflected growing momentum in its operational turnaround, while the figures showed improved performance at comparable hotels. Net income attributable to common shareholders was $2.5 million, or $0.12 per diluted share, following a loss of $69.0 million, or $11.35 per share, in the same period of 2025. By contrast, total hotel revenue fell to $214.275 million from $265.676 million a year earlier. The report thus combined improving operating metrics and quarterly profitability with lower total revenue as the portfolio contracted.
At comparable hotels, revenue per available room (RevPAR) rose 7.3% to $140.8 in the quarter from the same period a year earlier. The figures attributed the growth to a 6.1% increase in comparable average daily rate (ADR), alongside a 1.2% rise in comparable occupancy. These metrics reflect an improvement in revenue generated per available room at hotels included in the comparison, alongside gains in rate and occupancy. Comparable hotel earnings also reached $55.5 million, up 6.9% from the third quarter of the prior year. But adjusted earnings before interest, taxes, depreciation and amortization were $34.9 million, a separate measure from comparable hotel earnings. The divergence highlights the different effects of performance at existing assets and changes in the size of the portfolio, as comparable hotel results grew while total hotel revenue declined.
For the first nine months of 2026, AFFO was $0.44 per diluted share, compared with a loss of $3.13 per share in the same period a year earlier. This figure places the quarter's performance in the context of the year-to-date period, as the nine-month result differs from the per-share loss recorded in the third quarter alone. The shift to quarterly net income also followed a large loss in the third quarter of 2025. Chief Executive Stephen Ziegler said the results "show that the operational turnaround at Ashford Trust is gaining momentum." He added that improved performance came alongside hotel sales, debt refinancing and growth in hotel earnings. The company thus linked operating performance with the debt-reduction steps it took during the year.
The company said it sold 19 hotels during the year for about $796 million and reduced total debt to $1.9 billion on September 30 from $2.6 billion at the start of the year. Interest expense also fell 16% in the third quarter compared with the same quarter of 2025. Outstanding loans totaled $1.9 billion at the end of September, with a weighted average interest rate of 8.4%. About 7% of consolidated debt carried a fixed interest rate, compared with 93% at a variable rate. The figures show that the reduction in debt coincided with exposure of most loans to changing interest rates, while the company attributed part of the improvement to lower interest expense. Hotel sale proceeds and debt reduction remain part of the backdrop to the quarterly results the company reported.
In trading, AHT closed at $2.22 on November 10, the day results were announced, after closing at $2.37 on November 9, the same level recorded on November 6. The stock had closed at $2.43 on November 5 and $2.64 on November 4. These closing prices provide context for the stock's movement in the days before and on the announcement date, without specifying the intraday trading range. On distributions, the company said its board would continue to evaluate preferred stock distributions each quarter. It added that cumulative preferred stock distributions would continue to accrue while suspended, and that resuming the return of capital to holders of those shares was subject to conditions permitting it. The company did not specify in its results statement when distributions would resume.