Hilton Grand Vacations Inc.HGV

Hilton Grand Vacations Inc. Fair Value Disclosure

10-KFiled Feb 26, 20262 min read
FAIR VALUE MEASUREMENTS
The carrying amounts and estimated fair values of our financial assets and liabilities, which are required for disclosure, were as follows:
December 31, 2025
Fair Value
($ in millions)
Carrying
Amount
Level 1Level 3
Assets:
Timeshare financing receivables, net
$3,115 $— $3,419 
Liabilities:   
Debt, net
4,545 4,352 233 
Non-recourse debt, net
2,716 2,128 640 
December 31, 2024
Fair Value
($ in millions)
Carrying
Amount
Level 1Level 3
Assets:
Timeshare financing receivables, net
$3,006 $— $3,203 
Liabilities:
Debt, net
4,601 4,309 283 
Non-recourse debt, net
2,318 1,873 446 
Our estimates of the fair values were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to interpret market data and develop the estimated fair values. The table above excludes interest rate swaps discussed below and cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses and other and advance deposits, all of which had fair values approximating their carrying amounts due to the short maturities and liquidity of these instruments.
The estimated fair values of our Level 3 originated and acquired timeshare financing receivables were determined using a discounted cash flow model. Our model incorporates default rates, coupon rates, credit quality and loan terms respective to the portfolio based on current market assumptions for similar types of arrangements.
The estimated fair values of our Level 2 derivative financial instruments were determined utilizing projected future cash flows discounted based on an expectation of future interest rates derived from observable market interest rate curves and market volatility. See Note 15: Debt and Non-recourse Debt above.
The estimated fair values of our Level 1 debt and non-recourse debt were based on prices in active debt markets.
The estimated fair value of our Level 3 debt and non-recourse debt were based on the following:
•Debt – based on indicative quotes obtained for similar issuances and projected future cash flows
discounted at risk-adjusted rates.
•Non-recourse debt – based on projected future cash flows discounted at risk-adjusted rates.

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Mar 3, 2025
2023Feb 29, 2024
2022Mar 1, 2023
2021Mar 1, 2022
2020Mar 1, 2021
2019Mar 2, 2020
2018Feb 28, 2019
2017Mar 1, 2018

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

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