An Epic Downturn: Vail Resorts Faces a Harsh Winter and Falling Revenues
- MMCG
- 1 day ago
- 26 min read
In mid-December at Vail Mountain in Colorado, skiers expecting a holiday snowpack instead found stretches of barren ground. Only about 11% of the resort’s terrain was open amid a startling dearth of early-season snow. Lift chairs ascended over brown slopes, and the usual bustle of Christmas-week crowds had thinned. This bleak scene is emblematic of a broader reality confronting Vail Resorts, the nation’s largest ski resort operator: a sharp downturn in visitation and revenue during one of the most challenging ski seasons in decades. Total skier visits across Vail’s U.S. resorts have plunged 20% compared to last year, and the company’s once-reliable income streams are sliding downhill in tandem. It’s a narrative of an industry giant caught in a perfect storm of weather calamity, shifting consumer behavior, rising costs, and fierce competition.
Vail Resorts — synonymous with famed mountain destinations like Vail, Breckenridge, and Park City — has built an empire commanding over half of U.S. ski industry revenue. But even this titan is not immune to the forces now squeezing its business. A historic snow drought in the western United States, amplified by long-term climate trends, has gutted visitation and on-mountain spending. At the same time, younger generations’ habits, labor unrest, and rivalry from other resort conglomerates are introducing new volatility to a once reliably booming business. The result is a rare winter of decline for a company that, until recently, seemed to only climb upward.
Snow Drought Slashes Visitation in the Rockies
The immediate culprit for Vail’s revenue stumble is Mother Nature. Company data for the season through early January paint a stark picture: Western U.S. snowfall was roughly 50% below the 30-year average, and nearly 60% below average in the critical Rocky Mountain region. With so little natural snow, Vail’s resorts were forced to keep most terrain closed; by the end of December, barely one-tenth of terrain was available at its Rocky Mountain properties. The effect on skier traffic was dramatic. Across Vail’s 36 North American resorts, season-to-date skier visits fell 20.0% year-over-year, marking one of the weakest early seasons in over three decades. “We experienced one of the worst early season snowfalls in the western U.S. in over 30 years,” Vail’s CEO Rob Katz noted, describing how the weather limited terrain and “negatively impacted visitation and ancillary spending for both local and destination guests”.
The visitation decline has been most acute in markets dependent on natural snow. Resorts in Tahoe and the Pacific Northwest saw near-record low snow through mid-December, and even the usually snow-sure Whistler Blackcomb in Canada had a sluggish start. Conditions improved somewhat after New Year’s as major storms rolled in – Tahoe and Whistler were able to open much more terrain in January – but by then the holiday prime weeks had passed. Only Vail’s East Coast resorts (from Vermont to New York) provided a bright spot, with cold weather allowing snowmaking and decent early conditions that partially offset the western shortfall. Still, the overall numbers were grim and virtually unprecedented. Nationwide, U.S. ski visits set a record high last winter, but this season is proving the exception. Vail’s mid-season update underscored that every region of its portfolio felt the hit from the snow drought in one way or another.
Revenue Streams Hit Across the Board
Fewer skiers on the slopes translate directly into fewer dollars in the lodge. Virtually all of Vail Resorts’ revenue segments have declined in tandem with visitation. During the early-season period (through Jan. 4), ski school lessons and on-mountain dining saw especially steep drops – ski school revenue plunged 14.9%, while dining revenue fell 15.9% year-over-year. Empty tables at resort restaurants and lightly booked lesson slots were a common sight in many western resorts as vacationers either canceled trips or spent less amid poor conditions. Retail and rental operations also struggled: sales of gear and ski/snowboard rentals at Vail’s resort stores were down 6.0% compared to the same period last year. The decline in these ancillary categories underscores how dependent they are on physical traffic. If skiers don’t show up, they’re not renting boards or buying that extra hoodie or hot chocolate on the mountain.
One area of relative resilience was lift ticket revenue – but even there the picture is mixed. Vail reported that total lift revenue was down a scant 1.8% in the early season, a far smaller decline than the 20% drop in skier visits. This gap is no accident; it reflects the stabilizing effect of Vail’s Epic Pass strategy. In recent years, Vail has aggressively pushed advance-purchase season passes (the Epic Pass) which provide unlimited or multi-day access across its resorts. Hundreds of thousands of skiers bought their passes before the season even began, locking in revenue for Vail Resorts long before the first snow. This upfront commitment helped “[shield] their lift revenue from a total freefall” even as actual turnstile counts fell – effectively, prepaid pass revenue buoyed the lift segment despite the low turnout. Indeed, the average effective price per lift ticket (including pass use) jumped significantly as predominantly passholders hit the slopes: by one analysis, Vail’s effective ticket price rose about 12% this season, as the company and its remaining guests leaned on passes and higher window rates to make up for volume loss.
Still, a slight uptick in lift yield was nowhere near enough to compensate for the plunge in other spending. On-mountain businesses that rely on incremental visits – ski schools, cafes, equipment shops – experienced a revenue drought of their own. Table service restaurants at Vail-owned resorts saw noticeably lighter lunch crowds on what should have been peak days, and ski instructors waited idly as bookings dried up. Vail’s full fiscal-year results from the prior season (when snow was also patchy) showed how sensitive these segments are: ski school and dining managed only modest growth for the full year (up 6% and 1.3%, respectively), while retail sales dropped 13.8% and rentals fell 10% in FY2024 as skier visits declined. The pattern is clear – when skiers stay home, ancillary revenues quickly evaporate.
Table: Vail Resorts – Early-Season U.S. Revenue by Segment (Season-to-date through early January)
Revenue Segment | Change vs. Prior Year |
Lift Ticket Sales (incl. Epic Pass allotment) | –1.8% |
Ski School (Lessons) | –14.9% |
Dining (On-Mountain) | –15.9% |
Retail/Rental (Resort stores) | –6.0% |
These declines underscore how Vail’s business model, while diversified across multiple revenue streams, is tightly intertwined with skier visitation. The Epic Pass has provided a cushion on lift revenues, essentially smoothing out some of the volatility by trading lower per-visit income for higher guaranteed volume. But the trade-off is evident: once passholders have paid upfront, they often spend less per day on the mountain (many are repeat local skiers brown-bagging lunches or using owned gear). Meanwhile, destination travelers, who tend to spend more freely on rentals, lessons, and meals, simply didn’t show up in their usual numbers during the bad weather. The result is a broad-based revenue shortfall that is testing Vail Resorts’ ability to manage costs and maintain guest experience in a lean season.
Profit Margins and Earnings Slide Downhill
Beyond top-line revenues, the financial hit from this year’s woes is clearly visible in Vail Resorts’ profitability metrics. After enjoying a post-pandemic boom, the company is now seeing its earnings fall sharply. According to the firm’s financial filings, operating income dropped to about $373 million from $457 million the prior year – roughly an 18% decline. Net income has fallen even more on a percentage basis: in the most recent fiscal year, net income attributable to Vail Resorts was $268.1 million, down from $347.9 million in the previous year. That’s a drop of nearly 23% in bottom-line profit, reversing some of the gains of the late 2010s. (For context, Vail’s net income in FY2024 was also down about 14% from FY2023, reflecting lingering challenges even before this season’s disastrous start.)
Unsurprisingly, profit margins have eroded. By internal estimates, Vail’s EBITDA margin (a key indicator of operating profitability) tumbled from 31.6% to 24.7% year-over-year. In other words, costs are consuming a much larger share of each dollar of revenue. This margin contraction stems from a combination of factors: lower high-margin revenue (like lift tickets and lessons) to absorb fixed operating costs, higher labor and operating expenses, and the impact of ongoing capital investments. Vail Resorts had to keep fundamental operations (snowmaking, grooming, lifts, and basic staffing) running despite serving 20% fewer guests, which is a recipe for lower efficiency. Compounding that, inflation and wage pressures have driven up the cost of everything from fuel for grooming machines to wages for lift operators and patrollers. The company’s recent earnings calls have noted outsized growth in expenses – for example, labor costs on the mountain side jumped considerably as Vail raised wages to attract workers in a tight labor market and to address employee dissatisfaction.
Another financial strain is the weight of Vail’s debt load. Years of aggressive expansion – growing from 10 owned resorts a decade ago to 42 resorts across four countries today – have been fueled in part by borrowing. The company’s total debt now stands around $2.75 billion, and with the decline in equity value, Vail’s debt-to-equity ratio is roughly 4.6. In simpler terms, the company carries nearly five dollars of debt for every dollar of shareholder equity, a leverage level that is high for the leisure industry. (Independent analyses put Vail’s debt at roughly $2.8 billion against about $468 million in equity, implying a debt-to-equity of ~592%.) Servicing this debt has become more expensive – interest rates have risen significantly over the past two years, meaning Vail pays more interest on its variable-rate loans and any new debt. Higher interest expense, of course, cuts directly into net income. The company has continued to pay a substantial dividend to shareholders, further straining free cash flow. The result is that Vail’s once-strong balance sheet has weakened, limiting its financial flexibility at a time when it might need extra investment to weather the storm.
Faced with these pressures, management has started looking for fat to trim. In late 2024, Vail Resorts announced a two-year “Transformation Plan” targeting $100 million in annual cost savings by FY2026. The plan involves scaling efficiencies across its now-sprawling network of resorts, implementing shared services, and tightening workforce management. Already, the company moved to eliminate about 2% of its workforce (including 14% of corporate positions) in a reorganization aimed at streamlining operations. “No matter how big or small the impact of the position eliminations, we do not take lightly any decision that affects our team members,” CEO Kirsten Lynch (who was then leading the company) said at the time. These cuts, while helping blunt the immediate financial pain, also reveal the tension Vail faces between cost discipline and maintaining its vaunted “guest experience.” The company insists that front-line operations will not be compromised, but fewer support staff and leaner budgets inevitably raise the challenge of doing more with less. After years of prolific growth and spending, Vail Resorts is being forced into an unfamiliar role: retrenchment and belt-tightening to rebuild its margins.
Climate Change Raises the Stakes (and Costs)
Looming over this season’s immediate weather troubles is the larger and more troubling context of climate change. What was historically an unusually bad snow year is becoming part of a concerning pattern. Warmer winters and volatile precipitation are a growing threat to the ski industry’s fundamentals, and Vail Resorts’ latest downturn may be a sign of things to come. Research shows that the American West’s snowpack has been shrinking for decades. Since the early 1980s, the amount of snow during winter in the Western U.S. has dropped by 41%, and the ski season has shortened by more than a month on average. The Rockies are seeing higher temperatures (especially at lower elevations) and more erratic snowfall, a trend scientists link directly to global climate change. This means seasons like the current one – or worse – could become more frequent.
The financial impact of these climate shifts is already measurable. A recent scientific study quantified that U.S. ski areas lost an estimated $5 billion in revenue from 2000 to 2019 due to diminished snow seasons linked to human-caused climate change. Another analysis by industry group Protect Our Winters found that just the five lowest-snow years between 2001 and 2016 saw 5.5 million fewer skier visits and 17,400 fewer jobs compared to average seasons. In other words, bad snow years rip a hole not only in resort company profits but also in mountain town economies. If global emissions are not curbed, the same study warns that by the 2050s ski resorts could be losing $1 billion in revenue every year nationwide due to climate-driven season deterioration.
For Vail Resorts, a company that has bet big on owning resorts coast-to-coast, climate change is a double-edged sword. On one hand, its geographic diversification provides a hedge – as seen this season, strong snow in the Northeast partially offset the western drought. Vail can shuffle marketing and resources around to wherever conditions are best. But on the other hand, warmer temperatures raise costs everywhere. To open just 11% of terrain in the Rockies this December, Vail’s mountains relied heavily on artificial snowmaking – an expensive, resource-intensive process. Ski areas typically spend between $500,000 and $3.5 million each winter on snowmaking operations, and that figure climbs in low-snow years when every available snow gun must run constantly. This season, high “wet-bulb” temperatures (the combination of warmth and humidity) often limited even the ability to make snow at lower elevations. The energy usage is massive: an estimated 67% of a ski resort’s energy consumption from October to January goes into snowmaking. Burning that much power (often from fossil fuels) isn’t just costly – it contributes to a vicious cycle by pumping out more CO₂ into the atmosphere, potentially worsening warming. As one climate scientist wryly observed, ski resorts’ increasing dependence on artificial snow can become “part of the problem” if their energy isn’t clean.
Vail Resorts has acknowledged this reality and in fact has taken notable steps to mitigate its environmental impact. Back in 2017, then-CEO Rob Katz announced a “Commitment to Zero” initiative – a pledge for Vail’s resorts to reach 100% renewable electricity and zero net emissions by 2030. The company has since invested in energy efficiency and some on-site renewables (for instance, installing low-energy snow guns and solar arrays on facilities). These efforts may reduce operating costs in the long run and burnish Vail’s environmental credentials with climate-conscious younger skiers. However, even carbon-neutral resorts cannot make winters cold or wet. The brutal fact is that if warming continues unabated, many ski areas will face shorter seasons or even untenable operations. Studies project that within 50 years, most lower-elevation ski resorts (below 5,000 feet) may no longer be viable due to lack of reliable snow. Vail’s portfolio does include high-altitude destinations (like Breckenridge or Whistler’s high alpine) that will be among the last to lose their snow climates, but its collection of Midwest and East Coast hills are far more vulnerable. Already, the Midwest ski areas saw a devastating 26.7% drop in visits last season when temperatures swung wildly and forced repeated closures – and Vail owns more Midwest hills than any competitor, exposing it to outsized risk in those regions.
All of this suggests that climate change is not a future threat – it’s here now, reshaping the ski industry’s economics. Vail Resorts will likely need to invest even more in snowmaking (and perhaps summertime attractions to diversify revenue) to adapt to these changes, which in turn raises its cost base. Katz, who returned as CEO in 2025 amid the company’s struggles, has openly called climate variability “the biggest long-term challenge we face” in recent statements. The company’s revised earnings guidance this year explicitly warns that continued weak snowfall could push its profit below forecast. In essence, Vail is learning that it must operate as much in the business of climate risk management as in the business of skiing.
A New Generation of Skiers – or Lack Thereof
Weather is one crisis; the demographic and cultural shifts in Vail’s customer base may be another. The ski industry has long fretted about an aging participant population, and evidence suggests those worries are valid. In the United States, the core skier demographic is literally getting older each year. The median age of a skier/rider is now 37, up from 30 a decade ago, according to the National Ski Areas Association. Young people (under 25) make up a shrinking share of total visits – 34% last season, down from 41% in 2013/14. These trends indicate that Millennials and Gen Z are not replacing Baby Boomers at the rate that Boomers are retiring from the slopes. As one industry analyst quipped, “it takes two Millennials to fill a Boomer’s boots,” in terms of skier visits – a reflection of lower participation and frequency among younger adults.
For Vail Resorts, which relies on a pipeline of new skiers and snowboarders to fill its mountains (and buy its Epic Passes), this generational shift is a serious concern. The company’s growth in the past was buoyed by affluent Gen X and Boomer families flocking to destination resorts. Now, many of those customers are aging out, and the cohorts behind them face more barriers to entry in snowsports. The first barrier is cost. Skiing has always been expensive, but the price tag has soared in recent years, between equipment, lodging, and lift access. Vail’s window lift tickets have made headlines by crossing the $200 and even $300 mark on peak days, a psychological threshold that sparked public outcry and unpleasant press. Even with the Epic Pass offering relative value (unlimited skiing for around $900), a family ski vacation for a few days can cost thousands after adding rentals ($50+ per day per person), lessons ($200+ per day), hotel nights, and meals. “Most young people can’t afford it,” admitted one industry observer bluntly. Snow sports in the U.S. remain predominantly the domain of the wealthy and white – over half of participants have household incomes above $75,000, and more than two-thirds are white. That lack of economic and ethnic diversity points to a limited pool of newcomers unless the industry changes its approach or pricing. Gen Z, in particular, is a more economically diverse and cost-conscious group; many in this generation are in their early career stage with less disposable income for pricey hobbies. They are also acutely aware of climate and social issues, and may feel conflicted about a sport associated with high carbon footprints and exclusivity.
The pandemic did offer a temporary boost in youth engagement – 2021 saw a rise in younger and more diverse first-time skiers and riders as outdoor recreation surged during COVID. Vail and its competitors eagerly reported a wave of interest from newcomers looking for safe, open-air activities. However, retaining those new skiers has proven challenging. Some of that bump was driven by remote work flexibility (young professionals decamping to mountain towns or extended “workcations”), a trend that has since cooled. As normal life resumed, the industry has largely returned to its prior equilibrium of flat or modest growth in participation. The long-term trend is essentially stagnation – U.S. ski visit numbers have oscillated with weather but not shown sustained growth in decades. This puts Vail in a difficult position: to grow its revenue organically, it must find ways to broaden its customer base, yet many structural factors (cost, demographics, climate) are working against that goal.
In response, Vail Resorts has tried several initiatives. It has slightly reduced some single-day ticket prices if bought in advance (to counter the “$300 lift ticket” outrage). It has also invested in programs to make learning to ski easier and more appealing – for example, creating dedicated beginner areas, offering package deals for lessons, and marketing heavily to families and college students. The company has talked about enhancing the “experience” through technology, such as its EpicMix app that gamifies skiing to appeal to tech-savvy youth. But perhaps the most crucial strategy is pricing and access: the Epic Pass itself was a play to lock in younger skiers with a relatively affordable season pass (monthly payment plans bring the cost within reach for many). That strategy worked spectacularly for over a decade, driving millions of sales. However, this year signaled a possible saturation point: for the first time since its 2008 launch, Epic Pass unit sales have declined – the number of passes sold for the 2024/25 season was about 3% lower than the prior year (though higher prices meant pass revenue still rose a few percent). This dip suggests Vail may have tapped out the existing market of pass buyers, and attracting new passholders will require converting people who currently aren’tskiing much at all. That is a heavy lift, implicating broader industry efforts to lure Gen Z with initiatives beyond Vail’s control (like youth outreach programs, diversity initiatives, and perhaps tamer pricing across the board).
What is clear is that the generational handoff in skiing is proving tricky. Vail Resorts now finds itself not just competing with other ski companies for customers, but competing with modern lifestyles. A winter ski trip must contend with warm-weather vacation alternatives, indoor entertainment, and a generation less likely to commit to expensive week-long trips. As the median skier age marches upward, Vail’s challenge will be to make the sport more accessible and enticing so that a new wave of skiers replaces those who age out. If it fails, the company could face a shrinking customer base in the long run, even aside from weather issues.
Competition and Consolidation: The Battle for the Slopes
Vail Resorts’ dominance of the ski industry has arguably been the defining industry story of the past 15 years. But it is no longer the only conglomerate in town. Competitive pressures from rivals like Alterra Mountain Company, Boyne Resorts, and Aspen Skiing Company have been mounting, adding another layer of complexity to Vail’s situation. In the late 2010s, seeing Vail’s success with the Epic Pass and multi-resort ownership, a group of competitors banded together to form the Ikon Pass under Alterra’s leadership. Alterra Mountain Company, backed by private equity, went on an acquisition spree of its own – assembling iconic destinations such as Aspen Snowmass (in partnership with Aspen), Steamboat, Deer Valley, Mammoth Mountain, and more. Today Alterra controls 15 major North American resorts and numerous partners on the Ikon Pass. Boyne Resorts (a longtime private operator of resorts like Big Sky and Loon) and Aspen (which runs its four mountains in Colorado) also form part of the Ikon alliance. The result is that while Vail remains the single biggest player, it no longer has the field to itself in attracting destination skiers.
Vail’s market share is still enviable – the company accounts for about 51.6% of all U.S. ski resort revenue (among multi-mountain operators), towering over Alterra’s roughly 16% share and Boyne’s ~8%. In ski and snowboard equipment rentals, where many independent shops exist, Vail’s share is around 10.7% of the U.S. market. This scale gives Vail considerable advantages: bulk purchasing power, cross-resort marketing, and a nationwide data analytics operation to optimize pricing and promotions. For example, the company can leverage insights from its huge pass database to nudge skiers toward underutilized resorts or off-peak times, something smaller rivals can’t easily do. Additionally, Vail’s geographic spread – from Vermont to California, Michigan to British Columbia – provides a buffer against regional downturns (a saving grace this year, as the snowy Northeast helped compensate for the dry Rockies).
However, size can also breed complacency and pushback. In recent seasons Vail Resorts has endured a bit of a public relations maelstrom: complaints about long lift lines, overcrowding (a side effect of record Epic Pass sales and pent-up pandemic demand), and a perception of declining customer service. A Wall Street Journal article in 2024 infamously asked “Has Vail Resorts Lost Its Edge?,” noting how some loyal skiers felt the “machine” of Vail was prioritizing profit over personal touch. Sensing an opportunity, Alterra and independent resorts positioned themselves as a more soulful alternative. Alterra’s CEO rustled feathers by saying their focus was on “the guest experience, not just the pass sales.”It’s no coincidence that Alterra kept the daily lift ticket prices at flagship Ikon resorts like Alta and Snowbird below Vail’s stratospheric levels – hoping to win favor with serious skiers alienated by Vail’s prices. There is also a grassroots “ski local” movement encouraging skiers to patronize smaller, independent hills or those on the Indy Pass (another multi-mountain pass focusing on independent resorts). While these smaller players are no real threat to Vail’s financial might, they contribute to the narrative that Vail’s ubiquity is not universally loved.
The competitive chess match largely revolves around the multi-resort passes. Vail’s Epic Pass vs. Alterra’s Ikon Pass is now akin to Coke vs. Pepsi for skiers – many choose one loyalty or the other. Both companies continue to add partner resorts and perks to outdo each other. (For instance, Alterra partnered with Aspen and international resorts to sweeten Ikon; Vail snapped up more regional ski areas to fold into Epic.) Price increases have also occurred in lockstep: each year both Epic and Ikon tick prices upward, careful not to stray too far from each other. This oligopolistic dynamic means the entire industry’s pricing power is influenced by the Vail-Alterra duel. In booming years, that’s fine; in a downturn, however, it could mean losing customers in tandem if both passes start to feel too expensive for the value, especially to newcomers. With Vail’s pass sales volume now blinking red, one wonders if Alterra will seize the moment to try to poach disaffected Epic Pass holders or offer aggressive promotions. So far, early indications for 2024/25 show Ikon Pass sales holding steady, but not exploding either – suggesting that the overall pass market may be maturing.
It’s also worth noting that on the destination travel front, Vail faces competition from high-end resorts that are not under its umbrella. Jackson Hole, Snowbird, and other bucket-list mountains not owned by Vail still draw affluent visitors who might otherwise spend a week at Vail or Beaver Creek. These independent resorts have aligned either with Ikon or remain boutique experiences. Aspen, in particular, with its luxury appeal and limited crowding (due to capped pass sales), stands as a counter-model to Vail’s volume-driven approach. The competition for affluent vacationers is a serious battle: a family choosing between, say, Vail and Deer Valley for their one ski trip will weigh snowfall, prices, and experience – factors that Vail can’t monopolize. This season, Alterra’s Steamboat resort in Colorado actually saw better early snowfall than some Vail resorts, potentially drawing some holiday travelers away. In tight times, competitors are quick to capitalize on Vail’s misfortunes, using social media and marketing to highlight when their conditions are superior.
The bottom line is that Vail Resorts no longer operates in isolation. The ski industry has consolidated into a handful of heavyweight players, and while Vail is the biggest, it must continuously earn the loyalty of skiers who have other options. Competitive dynamics will likely keep Vail from simply raising prices indefinitely to cover revenue shortfalls – if it does, it risks driving customers to Ikon or other passes. Likewise, maintaining high quality across dozens of resorts is an immense task; any slip-ups can become a selling point for rivals. For Vail, the age of easy growth through acquisition is largely over (there are few major resorts left to buy), and the game has shifted to maximizing the performance of what it already owns, while not ceding terrain to hungry competitors.
Labor Pains and Rising Costs on the Mountain
Amid all these external challenges, Vail Resorts has also been grappling with pressures within its own ranks. The company’s employees – from lift attendants to ski patrollers to hospitality staff – are the backbone of its famed guest experience. In recent years, however, labor shortages and disputes have emerged as significant issues, mirroring broader service industry trends. Low unemployment and the high cost of living in ski towns have made hiring and retaining seasonal workers difficult for Vail and others. The pandemic exacerbated this, as service workers were in short supply and housing costs in mountain regions surged. Even now, many resorts struggle to fully staff operations, sometimes leading to reduced lift and terrain openings not due to snow, but due to lack of crew. For example, an industry-wide shortage of lift operators was noted last winter, forcing some resorts to slow or limit lift schedules. Vail has had to raise its base wages several times to stay competitive; in 2022 it set a company-wide minimum wage of $20 per hour for U.S. employees, a substantial increase aimed at attracting talent after reports of some staff leaving for better pay at fast-food restaurants.
Wage pressures have also come from organized labor actions. In early 2023, ski patrollers at Vail’s Park City Mountain resort in Utah went on strike, seeking higher pay and better terms. The strike, which coincided with the busy Christmas-New Year period, nearly shuttered Park City’s operations and drew national attention (even the New York Timescovered the “ski patrol strikes” as a sign of industry trouble). Guests were furious about closed terrain and long waits, and one even filed a class-action lawsuit over a “colossal disaster” of a vacation during the disruption. Ultimately, Vail Resorts reached a settlement with the Park City patrollers, granting an average wage increase of $4 an hour, with veteran patrollers receiving up to $7.75 more in hourly pay. Not long after, Vail proactively announced raises for patrollers at six of its other resorts (those with heavy avalanche terrain, hence high-skill demands), bumping their pay by 9% to 18% depending on seniority. However, in a twist, those immediate raises excluded patrollers at mountains where unions existed (Breckenridge, Keystone, Crested Butte, and Stevens Pass) – the company said it had to negotiate separately with unionized patrol teams due to collective bargaining rules. This stance frustrated some union members, who argued Vail could and should extend the same generosity to them without delay. The episode highlighted the growing role of unions in the ski industry, an arena that historically saw little union presence. Today, multiple Vail resorts have unionized staff factions (from patrollers to mechanics), and they are becoming more vocal in pushing for higher wages and better housing/support.
Labor unrest is not just limited to pay rates. In January 2025, dozens of Vail’s Breckenridge employees staged a “sick-out” protest to draw attention to dire living conditions in company-provided housing. The incident underscored how even as Vail hires en masse – nearly 45,000 seasonal workers annually – it struggles to provide the standard of living those workers expect (and need to remain in expensive ski towns). Affordable housing, transportation, and work-life balance are all pain points. Vail’s size and profitability have made it a target for criticism that it should “do more” for its frontline staff. The company has responded with some measures: constructing employee housing projects, offering end-of-season bonuses, and perks like free ski passes for employees and their families. Yet, from a financial perspective, the cost of labor per skier is rising. Every wage hike or benefit adds to operating costs and pinches margins, especially in low-revenue seasons.
For Vail’s leadership, investing in employees is a long-term necessity – happy, returning staff are crucial for guest satisfaction, and experienced patrollers and instructors are part of the product. But in the short term, these labor investments come at a time when revenue is under pressure, creating a squeeze. It is telling that Vail’s recent transformation plan explicitly calls out “expanded workforce management” and efficiency; the company is searching for ways to be productive with fewer people or with new technology. Some resorts have experimented with automated kiosks for ticketing and RFID gates that reduce the need for some staff. There is even talk of self-driving snowcats and AI-powered snowmaking systems in the future. However, skiing is fundamentally a human-centric service industry – most guests won’t tolerate cutbacks that clearly detract from their experience (like closed lifts due to staffing or lack of safety personnel on duty). So Vail must perform a delicate balancing act: reward and retain its employees sufficiently to avoid service failures, while reining in labor cost growth to protect its bottom line.
Thus far, the company’s messaging has been upbeat — celebrating that, despite challenges, guest satisfaction scores have remained strong and crediting employees for “delivering on the guest experience” amid adversity. That suggests Vail has, to some degree, absorbed the costs to keep things running as smoothly as possible for guests this season (for example, pumping overtime hours or extra hiring when the weather finally improved). It may be the right decision to prioritize long-term reputation over one season’s profit. But it cannot be ignored that labor and operating cost escalation are now built into the business model going forward. Vail’s EBITDA margin compression (from ~32% to ~25% as noted) is partly a reflection of that new reality. Unless offset by higher revenue or pricing, this is a drag that won’t easily disappear in subsequent years.
Navigating an Uncertain Future
Taken together, the convergence of factors hitting Vail Resorts paints a challenging road ahead. The 2025/26 winter season may go down as a financial anomaly – an unlucky bad-snow year that dented profits – but the underlying issues it exposed are structural. Climate variability, an aging customer base, heightened competition, and labor constraints are not going away. The question for Vail is how to adapt its strategy to thrive in this new environment.
In the near term, the company has already adjusted its expectations. Vail trimmed its earnings forecast for the full year, telling investors that Resort EBITDA will likely come in just below the low end of prior guidance (~$842 million) given the poor start. That essentially bakes in the early-season losses with hopes that a strong spring could claw back some revenue. There’s some precedent for late-season rallies – March has become one of the snowier months in the Rockies in recent years, and pent-up demand can unleash if conditions improve. Vail is also leaning hard on its advance commitment strategy (Epic Pass) to guarantee a base level of visits and revenue regardless of weather. This strategy has proved its worth this season, and the company is likely to double down on it, perhaps by innovating new pass products or incentives. (For instance, the new “Epic Day Pass” allows flexibility to buy a set number of days at a lower cost, targeting casual skiers who may balk at a full season pass.)
Looking further out, Vail Resorts will need to find growth in a market that may not be growing much in traditional ways. One avenue is continued investment in the guest experience and capacity – ensuring that when the snow does fall, Vail’s resorts can capture as much demand as possible. The company has a slate of capital projects, from new high-speed lifts to upgraded snowmaking systems, across its properties. These investments are aimed at reducing lift lines, expanding terrain (in areas where permits allow), and making the ski day more seamless (RFID lift scanning, better grooming, etc.). Improved capacity and efficiency can translate to higher guest satisfaction and perhaps more repeat business, even if the absolute number of skiers nationwide stays flat. Vail is also exploring summer and shoulder-season opportunities – mountain coasters, bike parks, hiking, and events – to use its resorts year-round and diversify revenue beyond winter. This is a slow build, but resorts like Whistler and Park City already derive significant income from summer tourists, which can help cushion winter swings.
Another focus will be on technological and analytic improvements. Vail has been a leader in using data to optimize operations. With uncertain weather, predictive analytics might help deploy resources (for example, intelligently scheduling staff or deciding which base areas to open first in marginal conditions). Better forecasting and dynamic pricing could also play a role: Vail might offer more aggressive discounts in poor conditions to entice last-minute visitors, or conversely premium experiences (like guided backcountry access) in good conditions to boost per-guest spend. The Epic Mix app and other digital platforms can be used to engage younger skiers on their terms – integrating social media, tracking vertical feet, and fostering an online community that keeps interest high.
Crucially, Vail’s future will also depend on intangible goodwill. This season has been a test of its relationship with both customers and employees. How the company handles refunds, make-goods, or gestures of goodwill (for example, credits for passholders affected by closed terrain) could influence public perception. Similarly, how it navigates labor relations – whether it continues to address worker grievances proactively or faces more strikes – will affect its ability to deliver the luxury ski experience it markets. There are some signs of course correction: after criticisms of over-crowding last year, Vail implemented a reservation system at some resorts and limited Epic Pass sales in certain categories, attempting to balance access with experience. Moves like that indicate the company recognizes that sustainable success requires more than maximized sales; it requires trust and loyalty from its community.
For now, Wall Street is watching warily. Vail Resorts’ stock price has lagged, down about 12% over the past six months, underperforming leisure industry indexes. Investors have voiced concerns that the company’s growth story is stalling and that new investments (or even acquisitions overseas) may be needed to spark momentum. The board’s decision to reinstate Rob Katz as CEO (after a short stint by Kirsten Lynch) was itself a signal that a steady hand was needed to steer through the storm. Katz, who led Vail’s transformation from a one-mountain company into a global powerhouse, is now tasked with guiding it through what might be its most tumultuous period. In a recent statement, he struck an optimistic tone despite the setbacks: “The weather variability has reinforced our commitment to our advance commitment strategy and the investments we have made in our resorts and our employees… I’m proud of the team’s resilience”. Resilience will indeed be the keyword going forward.
As the snowpack gradually builds in the high country after a delayed start, there is hope that Vail Resorts can still salvage a decent season by spring. But the bigger picture is clear: the easy wins are behind it, and adapting to new realities will be paramount. An empire built on snowy dreams now finds itself confronting a warming climate, an evolving customer, and competitors at its heels. Vail’s story has always been one of bold expansion and innovation – from pioneering the interchangeable lift ticket in the 1960s to the Epic Pass in 2008. The next chapter will require equally bold reinvention, albeit of a different kind. The company will need to innovate not just in selling the dream of skiing, but in keeping that dream viable in a changing world.
In the meantime, in the quiet mornings at Vail’s flagship mountain, one can sense both the grandeur and fragility of the business. The sun rises over the Rockies, illuminating miles of ski runs that represent hundreds of millions in infrastructure and decades of cultivated lifestyle. On a bluebird day after a fresh snowfall, the allure of these slopes is undiminished – skiers will always crave the rush of a perfect run. Vail Resorts is betting that such days will continue to draw people in, and that it can navigate the rough winters in between. This season’s decline may indeed be a temporary blip caused by fickle weather. Or it may be a sign that even the mightiest ski company must evolve or face an irreversible downhill slide. In either case, the message is unmistakable: the business of snow is becoming a far more unpredictable ride, and only those prepared to adapt will make it safely to the bottom.
January 19, 2026, by a collective of authors at MMCG Invest, LLC, a ski resort and hotel feasibility study company
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