Overview

Vacasa is a leading vacation rental management platform in North America. The company operates a vertically integrated technology and operations platform that helps homeowners manage their vacation rental properties and provides guests with a seamless booking experience. Vacasa acts as an agent on behalf of homeowners, handling all aspects of the vacation rental process from listing creation to property care. The company earns revenue primarily through commissions and fees from homeowners and guests.

Recent Developments

In December 2024, Vacasa entered into an agreement to be acquired by Casago through a merger transaction. If completed, Vacasa’s Class A common stock will be delisted from Nasdaq. Vacasa has also received several unsolicited acquisition proposals from Davidson Kempner, which the company is currently evaluating.

In August 2024, Vacasa’s subsidiary issued $30 million in convertible notes to Davidson Kempner. The notes bear 11.25% interest and are convertible into Vacasa Class A common stock. Vacasa also has a $105 million revolving credit facility, of which $81 million was drawn as of the end of 2024.

Guest Demand and Booking Patterns

Vacasa experienced significant variability and weaker than expected guest demand in 2024, resulting in fewer nights sold per home compared to 2023. This led to lower revenue and cash generation than anticipated. The company expects continued softness and volatility in guest bookings, which will likely have an adverse impact on its business.

Workforce Reductions

In 2024, Vacasa implemented two restructuring plans that resulted in the elimination of approximately 1,120 positions, or 18% of the workforce. These actions were taken to align the company’s cost structure with its strategic and operating priorities.

Seasonality

Vacasa’s business is seasonal, with the first and second quarters typically being the strongest booking and cash generating periods, while the second and third quarters have the highest revenue due to increased nights sold during the peak summer travel season.

Financial Performance

Vacasa’s revenue decreased by 19% in 2024 compared to 2023, primarily driven by a 19% decline in nights sold. This led to a 18% decrease in cost of revenue and a 10% decrease in operations and support costs, but the company still reported a net loss of $154.9 million.

Adjusted EBITDA, a non-GAAP metric that excludes certain expenses, was a loss of $0.7 million in 2024 compared to a gain of $23.5 million in 2023. This decline was driven by the lower revenue, partially offset by reductions in operating expenses.

Key Business Metrics

Vacasa tracks several key metrics to measure the performance of its business:

• Gross Booking Value (GBV): The total dollar value of bookings, including rent, fees, and taxes. GBV decreased 20% in 2024 to $1.86 billion.
• Nights Sold: The total number of nights stayed by guests. Nights Sold decreased 19% in 2024 to 5.08 million.
• GBV per Night Sold: The average dollar value per night stayed. GBV per Night Sold decreased 1% in 2024 to $365.

These metrics reflect the decline in guest demand and lower utilization of Vacasa’s home inventory in 2024.

Liquidity and Capital Resources

As of December 31, 2024, Vacasa had $88.5 million in cash and cash equivalents. The company experienced a decline in its cash position during the year due to the weaker than expected demand and booking patterns.

Vacasa’s primary sources of liquidity are its existing $105 million revolving credit facility, of which $81 million was drawn as of the end of 2024, and the $30 million in convertible notes issued in August 2024. The company believes its current sources of liquidity will be sufficient to fund operations for at least the next 12 months.

However, Vacasa may need to seek additional financing in the future if the proposed merger with Casago is terminated or if the company continues to experience significant declines in guest demand and cash flow. The company’s future capital requirements will depend on its ability to attract and retain homeowners and guests, as well as its investment in technology and marketing.

Outlook

Vacasa expects continued softness and volatility in guest bookings, which will likely have an adverse impact on its business, results of operations, and financial condition. The company is focused on aligning its cost structure with its strategic priorities through the restructuring actions taken in 2024.

The proposed merger with Casago, if completed, would result in Vacasa’s delisting from Nasdaq. Vacasa is also evaluating the unsolicited acquisition proposals from Davidson Kempner, which could provide an alternative path forward for the company.

Overall, Vacasa faces significant challenges in the near-term due to the volatility in guest demand and booking patterns. The company’s ability to navigate these headwinds and position itself for long-term success will depend on its operational efficiency, homeowner and guest retention, and strategic decision-making.