Viad Corp (VVI): 5 FORCES Analysis [Nov-2025 Updated]

You're digging into the competitive structure of the newly pure-play experiential travel leader, and honestly, the late-2025 picture is compelling: after posting a record Q3 revenue of $241.0 million and raising full-year guidance, it's clear their strategy of owning irreplaceable assets is working. Still, even with a rock-solid balance sheet showing a net leverage ratio of just 0.7x, we need to break down Michael Porter's Five Forces to see where the real risks lie-from the leverage of specialized suppliers to the ever-present threat of a customer choosing a different iconic destination instead of one of their 17 attractions. Let's map out the dynamics that will shape their planned $38 million to $43 million organic growth CapEx for the rest of the year.

Viad Corp (VVI) - Porter's Five Forces: Bargaining power of suppliers

You're looking at the supplier landscape for Viad Corp (VVI), now largely operating as Pursuit following the expected sale of the GES business effective January 2, 2025. The power held by those supplying Viad Corp's remaining attractions and hospitality assets is definitely a key lever in margin management.

Labor costs represent a significant, immediate pressure point. The operational model, especially for the Pursuit segment's experiential offerings, is highly dependent on human capital. We are looking at a structure that requires approximately 2,500 seasonal employees alongside 1,500 year-round staff to maintain service levels.

When you operate in iconic, often remote locations, the leverage held by specialized suppliers increases. Think about food and beverage providers or fuel distributors serving areas like the Canadian Rockies or near major U.S. National Parks. Their limited competition in those specific geographies means Viad Corp has less flexibility to switch vendors without significant operational disruption.

Government agencies function as critical, non-negotiable suppliers through the framework of long-term concession agreements. The National Park Service (NPS), for instance, controls access to irreplaceable assets. As of late 2025, the NPS Commercial Services Program administers nearly 500 concession contracts that collectively gross over $1 billion annually. Furthermore, these concessioners employ more than 25,000 people during peak seasons. The regulatory environment itself, with final rules like the one effective February 18, 2025, dictates terms that suppliers (concessioners) must adhere to, which indirectly affects Viad Corp's operational framework.

Here's a quick look at the scale of the NPS supplier/partner ecosystem, which dictates terms for access to prime locations:

For capital equipment-think gondolas, specialized motorcoaches, or unique ride systems for attractions-the supplier base is both concentrated and highly specialized. These are not off-the-shelf purchases; they require proprietary knowledge for installation, maintenance, and compliance. Suppliers in this niche command strong pricing power because the cost and risk of qualifying a new vendor are prohibitively high, especially for unique assets within the Pursuit portfolio.

Rising operational costs are consistently noted as pressuring margins. This pressure point is a recurring theme, as seen in the context of 2024 results where rising costs for both labor and supplies were explicitly called out as margin headwinds.

You should keep an eye on these specific cost drivers:

• Labor wage inflation, especially for specialized seasonal roles.
• Fuel price volatility impacting motorcoach and logistics costs.
• Costs associated with proprietary maintenance parts for specialized attractions.
• The impact of any new regulatory compliance costs passed down from concession agreements.

Finance: draft 13-week cash view by Friday.

Viad Corp (VVI) - Porter's Five Forces: Bargaining power of customers

You're analyzing the customer side of the equation for Pursuit, which is what Viad Corp is now, focusing on how much leverage the end consumer or intermediary has over pricing and terms. Honestly, for the core, unique experiences, that power is quite constrained.

The bargaining power of customers is generally low because of the irreplaceable nature of key assets like the Columbia Icefield Adventure. This experience, which involves riding the Ice Explorer onto the Athabasca Glacier and visiting the glass-floored Skywalk, is positioned as an iconic Canadian Rockies experience that few, if any, competitors can replicate with the same access or infrastructure. Pursuit actively seeks to maintain a collection of irreplaceable attraction and hospitality businesses that have perennial demand and high barriers to entry. Furthermore, the company secured full ownership of Glacier Park, Inc. by acquiring the remaining $\mathbf{20\%}$ minority interest for $\mathbf{\$13 \text{ million}}$ as of September 30, 2025, solidifying control over key assets.

Pursuit maintains strong pricing power through dynamic pricing strategies for rooms and tickets. This is evidenced by the operational results, where attraction ticket prices were up $\mathbf{11\%}$ and lodging Revenue Per Available Room (RevPAR) grew $\mathbf{9\%}$ on a same-store basis. High customer demand is evident in the Q3 2025 revenue of $\mathbf{\$241.0 \text{ million}}$, which is up $\mathbf{32.2\%}$ year-over-year. The company is confident enough to raise its full-year 2025 adjusted EBITDA guidance to a range of $\mathbf{\$116 \text{ million}}$ to $\mathbf{\$122 \text{ million}}$.

Here's a quick look at the recent financial strength driving that pricing power:

Still, bargaining power is higher for large tour operators negotiating group rates. These large intermediaries can often command better terms than an individual traveler, especially when booking significant volume across multiple properties or experiences. This is a standard dynamic in the travel and hospitality sector.

Customer switching costs are low for general leisure travel, but high for a specific iconic experience. For general travel needs, customers can easily choose other destinations or operators. However, for a guest specifically seeking the unique experience of walking on the Athabasca Glacier, the cost to switch to an alternative that offers the exact same experience is effectively infinite, as the asset is exclusive to Pursuit. The existence of the Pursuit Pass, which offers savings when bundling attractions, suggests a strategy to increase the cost of switching between Pursuit's own offerings, locking in a customer for a multi-experience itinerary.

You can see the key factors influencing customer power here:

• High barriers to entry limit direct substitutes.
• Pricing power is supported by strong demand metrics.
• Group buyers maintain negotiation leverage.
• Iconic asset exclusivity raises individual switching costs.
• Total liquidity stood at $\mathbf{\$274.4 \text{ million}}$ at September 30, 2025.

Viad Corp (VVI) - Porter's Five Forces: Competitive rivalry

You're analyzing Viad Corp (VVI), which, following the sale of its GES business, now operates purely as Pursuit Attractions and Hospitality, trading as PRSU as of January 2, 2025. This shift concentrates the competitive rivalry analysis squarely on the experiential travel and unique lodging space, though the broader hospitality context remains relevant.

Rivalry is high and fragmented in the general hospitality sector where Pursuit's lodging component competes, albeit indirectly, with giants like Marriott International and Hilton Worldwide. These major players project significant scale in 2025; Marriott forecasts comparable systemwide constant-dollar Revenue Per Available Room (RevPAR) growth of 2% to 4% for the full year, alongside net rooms growth of 4% to 5%, with an expected Adjusted EBITDA between $5.29 billion and $5.43 billion. Hilton, meanwhile, anticipates systemwide RevPAR growth of 2% to 3% in 2025, with net unit growth projected at 6% to 7% over 2024 levels. To put the industry valuation in perspective, the Hotels & Motels Industry is currently trading at a trailing 12-month EV/EBITDA multiple of 15.59X, compared to the S&P 500's 17.94X.

Direct rivalry for the unique, irreplaceable attractions that define Pursuit's core business is comparatively low. The company's strategy hinges on owning and operating a limited supply of such assets. Since 2015, Pursuit has aggressively grown its portfolio through its Refresh, Build, Buy strategy, expanding from 4 world-class attractions to 17 and from 12 lodges to 29. This focus on unique assets allows for significant pricing power, as evidenced by a 9% increase in same-store attraction ticket prices reported in the third quarter of 2025.

Competition definitely exists regionally for leisure travelers across the US and Canada, where many of Pursuit's established collections reside. The company's third quarter of 2025 saw its dedicated team deliver extraordinary experiences to approximately 2 million attraction visitors and welcome lodging guests across nearly 200,000 room nights. The recent acquisition of Tabacón Thermal Resort & Spa in Costa Rica for $111 million in July 2025 expands this regional competition into a new, high-quality international market.

Pursuit competes on service quality and the uniqueness of its 17 world-class point-of-interest attractions and 29 distinctive lodges. This focus is clearly paying off financially; Pursuit delivered record third quarter 2025 revenue of $241.0 million, a 32.2% year-over-year increase, with Adjusted EBITDA rising 41.5% year-over-year to $117.4 million. The company focuses on the high-margin, high-growth segment of the experience market, reflected in its Q3 2025 Adjusted EBITDA margin expanding to 49%.

Here's a quick look at the scale of Pursuit's operations and recent financial performance compared to its major hospitality peers' 2025 outlook:

The company's strategy to capture this high-margin segment involves significant investment, including the $111 million Tabacón acquisition and a plan to invest $38 million to $43 million in organic growth capital expenditures for 2025.

The competitive dynamics within Pursuit's unique asset base can be summarized by its operational focus:

• Focus on irreplaceable assets in iconic destinations.
• Leveraging acquisitions like Tabacón for strategic fit.
• Driving yield optimization across geographies.
• Achieving strong flow-through to margin expansion.
• Securing full ownership of key subsidiaries like Glacier Park, Inc.

The ability to command higher pricing, with Q2 2025 seeing attraction ticket prices up 11% and lodging RevPAR up 9% on a same-store basis, demonstrates strong brand equity against general hospitality competitors. Still, the company must manage the regional competition for leisure dollars across its US and Canadian bases.

Finance: review the capital allocation plan for the $38 million to $43 million 2025 growth CapEx budget by next Tuesday.

Viad Corp (VVI) - Porter's Five Forces: Threat of substitutes

You're looking at the competitive landscape for the business now known as Pursuit Attractions and Hospitality, Inc. (formerly Viad Corp), focusing on what might pull a customer away from their iconic destination experiences.

The threat from alternative leisure options is substantial, given the sheer scale of competing travel sectors. For instance, in the third quarter of 2025, Pursuit welcomed approximately 2 million attraction visitors and accommodated nearly 200,000 room nights across its portfolio. This volume competes directly with the capacity of major cruise lines and large-scale all-inclusive resort operators.

Economic shifts present a clear risk, pushing consumers toward less expensive alternatives. Still, Pursuit's Q3 2025 performance showed strong pricing power, with attraction ticket revenue reaching $100.4 million, a 33% year-over-year increase, and overall Q3 revenue climbing 32% year-over-year to $241 million. The company raised its full-year 2025 adjusted EBITDA guidance to a range of $116 million to $122 million based on this demand.

Digital substitutes, while not yet a primary concern for high-touch, iconic destination travel, represent a growing technological alternative. The virtual event platform market was projected to reach $64.4 billion by 2025, indicating a significant, albeit separate, market for digital substitutes. For comparison, Pursuit's Q3 2025 attraction ticket revenue was $100.4 million.

The most fundamental substitute remains a consumer's choice of where to spend their discretionary travel budget. Pursuit actively manages this by ensuring its portfolio spans multiple, distinct, high-demand regions.

Pursuit mitigates destination substitution risk through its geographic diversification strategy, which includes assets in the US, Canada, and Iceland, recently bolstered by a major acquisition. The company invested $124 million in acquisitions during 2025, including a $111 million outlay for the Tabacón Thermal Resort & Spa in Costa Rica, adding a new iconic destination to its offering.

Here's a quick look at Pursuit's Q3 2025 operational scale versus its planned 2025 capital deployment, which supports asset quality against substitutes:

The company's focus on high-return growth is evident in its balance sheet health, which supports its ability to counter substitutes through investment:

• Net Leverage Ratio (End Q3 2025): 0.7x
• Total Debt (End Q3 2025): $129.8 million
• Identified Organic Investments (Through 2030): Over $250 million
• 2025 Adjusted EBITDA Guidance Midpoint: Approximately $119 million

The threat of substitution is countered by locking in demand through unique, irreplaceable assets, as seen in the 22% year-over-year increase in attraction visitors during the third quarter of 2025.

Viad Corp (VVI) - Porter's Five Forces: Threat of new entrants

You're assessing the competitive moat around Viad Corp (VVI)'s core attractions business, which is now largely embodied by the standalone Pursuit entity. Honestly, the threat of new entrants here is very low, and that's largely due to the sheer scale of capital and the regulatory hurdles involved in replicating what they have.

Obtaining the necessary long-term national park and government concessions is nearly impossible for any new player trying to break in. Pursuit's entire strategy is built on acquiring and building these truly irreplicable assets in the world's most iconic and sought-after locations. This isn't just about having money; it's about securing access that takes decades, sometimes generations, to establish.

The capital expenditure required to even attempt entry into this space is significant. For instance, for 2025 alone, the company planned for $38 million to $43 million in growth CapEx just to refresh and build out existing or near-term opportunities. To put that in perspective, Pursuit has identified over $250 million in organic refresh and build opportunities over the next six years. That's the kind of sustained investment new entrants would need to match just to get to the starting line.

Also, the balance sheet strength Viad Corp (VVI) now possesses acts as a powerful financial defense against any potential new competitor. As of the third quarter of 2025, the net leverage ratio stood at a very comfortable 0.7x. That low leverage, especially following the strategic separation of the GES business, means Viad Corp (VVI) has ample financial flexibility to deploy capital defensively or offensively against any emerging threat, while new entrants would likely start with much higher initial debt loads.

Here's a quick look at the financial foundation supporting this high barrier:

The barriers aren't just financial; they are structural, rooted in the nature of the assets themselves. New entrants face:

• Difficulty securing prime, high-traffic locations.
• Protracted and uncertain regulatory approval processes.
• The need to build brand equity in destinations already dominated by Pursuit.
• Massive upfront capital requirements for attraction development.

If you're looking at this from a risk perspective, the primary defense against new entrants is the entrenched, almost monopolistic access to specific, world-class sites. Finance: draft the 13-week cash view by Friday to ensure liquidity supports this CapEx plan.