Choice Hotels International (CHH) Q3 2025 earnings summary

Executive summary

• Achieved record Q3 adjusted EBITDA of $190.1M, up 7% year-over-year, driven by higher revenue brand mix, strong business/group travel, and international expansion.

• Net global rooms grew 2.3% year-over-year, with higher revenue segments up 3.3%; international net rooms grew 8.3% with significant expansion in France, Argentina, China, and new markets in Africa and Suriname.

• Net income rose to $180.0M from $105.7M year-over-year, with diluted EPS increasing to $3.86 from $2.22, aided by a $100M gain from the Choice Hotels Canada acquisition.

• 98% of the global pipeline consists of higher-revenue hotels; global franchise agreements awarded surged 54% year-over-year.

• International business is the fastest-growing segment, with Q3 adjusted EBITDA up 35% and portfolio expansion over 8% year-over-year.

Financial highlights

• Q3 2025 revenues were $447.3M, up 5% year-over-year; net income was $180.0M, up from $105.7M.

• Adjusted EBITDA reached $190.1M, up 7% year-over-year; adjusted EPS was $2.10, down from $2.23, but would have been $2.27 excluding acquisition-related items.

• Franchise and management fees rose 3% to $193.8M; partnership services and fees up 19% to $28.9M.

• Global RevPAR increased 0.2%, with international RevPAR up 9.5% and U.S. RevPAR down 3.2% year-over-year.

• EBITDA margin improved from 41% to 72% from 2022 to 2025.

Outlook and guidance

• Full-year 2025 net income guidance raised to $353–$371M, reflecting a $100M gain from the Canada JV acquisition.

• Adjusted EBITDA guidance set at $620–$632M; adjusted diluted EPS expected at $6.82–$7.05.

• U.S. RevPAR growth expected to be -3% to 0%; global net system rooms growth projected at ~1%.

• 80% of 2025 hotel openings expected from conversions, which typically open 80% faster than new builds.

• SG&A expected to grow at a low single-digit rate; free cash flow conversion expected at 60–65%.