Sotherly Hotels (SOHO) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue declined 3.7%–3.8% year-over-year to $48.8M, with RevPAR down 5.4%–5.9% and occupancy and ADR both lower; net income dropped to $1.6M from $4.7M in Q2 2024, and net loss attributable to common stockholders was $0.4M.

• Year-to-date revenue was $97.1M, nearly flat year-over-year; six-month net income was $6.3M, up from $6.0M, while net income attributable to common stockholders rose 15.9% to $2.3M.

• Portfolio underperformed expectations due to economic uncertainty, inflation, government spending cuts, and operational disruptions, especially from Hurricane Helene in Tampa.

• The company is actively managing liquidity, refinancing, and asset sales to address maturing debt and deferred preferred dividends.

• Business interruption insurance proceeds partially offset revenue and profitability losses from hurricane-related disruptions.

Financial highlights

• Q2 2025 total revenue: $48.8M (down 3.7%–3.8% YoY); six-month revenue: $97.1M (down 0.1% YoY).

• Q2 2025 net income: $1.6M (down from $4.7M YoY); six-month net income: $6.3M (up from $6.0M YoY).

• Q2 2025 Hotel EBITDA: $13.9M (down from $15.7M YoY); six-month Hotel EBITDA: $26.8M (down from $28.1M YoY).

• Q2 2025 Adjusted FFO: $4.8M (down 36.6% YoY); Adjusted FFO per share and unit: $0.23 (down from $0.38 YoY).

• Q2 2025 RevPAR: $128.34–$130.20 (down 5.4%–5.9% YoY); occupancy: 70.8%–71.0%; ADR: $180.73–$183.88.

Outlook and guidance

• 2025 full-year revenue guidance: $185.2M–$188.2M, a 2.6% increase at midpoint over prior year.

• 2025 hotel EBITDA guidance: $45.3M–$45.8M, a 2.6% decrease at midpoint.

• 2025 adjusted FFO guidance: $6.9M–$7.5M ($0.34–$0.37/share), revised downward.

• 2025 net loss attributable to common stockholders and unitholders expected at $(9.2)M–$(8.6)M.

• Group bookings expected to rebound in the second half of 2025, with government and leisure segments steady; anticipate full-year RevPAR to be approximately flat.