Choice Hotels International (CHH) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 adjusted EBITDA of $165 million, up 2% year-over-year, and record adjusted EPS of $1.92, up 4% year-over-year, despite total revenue of $426.4 million and net income of $81.7 million, both down year-over-year.

• Global net rooms system size grew 2.1% year-over-year, with international rooms up 5% and strong expansion in Brazil, France, and China.

• Domestic extended stay segment net rooms grew 10.5% year-over-year, with the segment now nearly 54,000 rooms and double-digit domestic growth for eight consecutive quarters.

• Acquired remaining 50% of Choice Hotels Canada for $112 million, expanding the Canadian portfolio to 327 units and over 26,000 rooms.

• Rewards program membership reached 72 million, up 8% year-over-year, and recognized as a top hotel rewards program.

Financial highlights

• Adjusted EBITDA reached $165 million, a 2% year-over-year increase; adjusted EPS set a Q2 record at $1.92, up 4% year-over-year.

• Q2 2025 total revenues were $426.4 million, down from $435.2 million in Q2 2024; net income was $81.7 million, down from $87.1 million.

• Adjusted net income for Q2 2025 was $90 million, up from $89 million in Q2 2024.

• Adjusted SG&A declined 4% to $77.6 million; excluding a $2 million operating guarantee payment, adjusted SG&A was $75.6 million, down 6% year-over-year.

• Operating cash flow for the first half of 2025 was $116.1 million, up from $113.6 million in 2024.

Outlook and guidance

• Full-year 2025 adjusted EBITDA guidance is $615–$635 million, including $6 million incremental from the Canadian acquisition.

• Net income guidance for 2025 is $261–$276 million; adjusted net income $324–$339 million.

• Adjusted diluted EPS guidance is $6.90–$7.22; domestic RevPAR growth outlook revised to -3% to 0% year-over-year.

• Adjusted SG&A expected to grow at a low single-digit rate from 2024 base.

• Projected 2025 annual dividend rate is $1.15 per share, or about $53.5 million in total dividends.