Unlocking Recurring Revenue: Why Ski Resorts' Seasonal Passes Are the Next Big Growth Play

The leisure industry has long been defined by episodic spending—theme parks, cruises, and ski trips are often one-off adventures. But what if operators could turn fleeting visits into predictable revenue streams? Enter the seasonal pass, a model that's transforming ski resorts into recurring revenue powerhouses. Vail Resorts (NYSE: MTN) is leading the charge, proving that locking in customers years in advance isn't just a strategy—it's a financial revolution. Here's why investors should act now.

The Rise of the Recurring Revenue Model
Recurring revenue isn't new, but its application in leisure is still underappreciated. Companies like Netflix and Spotify built empires on subscriptions, and now ski resorts are following suit. Seasonal passes, particularly Vail's Epic Pass, offer skiers unlimited visits for a single upfront fee. This model creates three critical advantages:
1. Predictable Cash Flow: Pass sales are booked early, insulating operators from weather, economic downturns, or last-minute cancellations.
2. Customer Loyalty: Repeat passholders spend more on lodging, dining, and equipment than casual visitors.
3. Margin Protection: Fixed pass revenue shields EBITDA when visitation dips—like this season's 3.1% skier decline, which was offset by a 3.4% lift in ticket revenue.

Vail's Proof of Concept: Data-Backed Dominance
Let's dissect the numbers:

• Pass Revenue Growth: Despite a slight dip in pass units sold (down 2% in early sales for 2024/25), sales dollars rose 4%, driven by an 8% price hike. This pricing power is a hallmark of recurring models, where loyal customers prioritize access over cost.
• Retention Goldmine: Renewals among Vail's tenured passholders surged significantly, indicating a core customer base that's not just sticky—it's expanding its wallet share.
• Margin Stability: Even as skier visits fell, lift ticket revenue (including pass allocations) grew. This decoupling of revenue from daily visitation volatility is game-changing.

Why Now is the Time to Invest
1. Macro Resilience: Vail's spring sales through April 2025 occurred amid “significant macroeconomic volatility,” yet pass sales dollars still rose. This signals demand stickiness even in uncertain times—critical as interest rates linger.
2. Long-Term Leverage: Over four years, pass units have grown 59% and sales dollars 47%, outpacing skier visit growth. The 75% of visits now pre-committed via passes create a moat against new competitors.
3. Cost Discipline: Vail's $100M annual efficiency plan (Resource Efficiency Transformation) targets operational waste. With fixed pass revenue, every dollar saved drops straight to the bottom line.

The Risk? It's Already Priced In
Bearish arguments focus on declining new passholders and weaker ancillary sales (retail fell 4%). But these are temporary headwinds. The 975M+ in pre-committed pass revenue for 2024/25 is already in the bank. Meanwhile, the Epic Pass's 8% price increase isn't just a one-off—it's a template for future hikes as demand outstrips supply.

The Catalyst: June's Earnings Report
Vail's June earnings will reveal full spring pass sales data for 2025/26. If renewals remain strong—and early signs point to it—this could ignite a re-rating. The stock trades at 19.6x trailing EBITDA, a discount to its growth trajectory.

Final Call: Act Before the Lift Starts Rising
Ski resorts aren't just selling snow; they're selling certainty. Vail's pass program turns winter whims into ironclad revenue. With EBITDA guidance now anchored in predictable pass streams, this is a rare play in leisure: a recession-resistant, margin-expanding, recurring revenue machine. Investors who act now get in before the next season's passes sell out—and the stock follows.

The pistes are clear. The lift is ready. Don't wait for the powder to melt.

This article is for informational purposes only. Always conduct your own research or consult a financial advisor before making investment decisions.