Choice Hotels International (CHH) Q4 2025 earnings summary

Executive summary

• Adjusted EBITDA reached $626 million in 2025, up 4% year-over-year, with adjusted EPS of $6.94, both in line with guidance.

• Record profitability in 2025, with net income of $369.9M, driven by international expansion, higher-revenue brand mix, and growth in the extended stay segment.

• Global hotel openings grew 14% year-over-year, with international system size up 13% and U.S. extended stay openings at record levels.

• Strategic exits of underperforming hotels improved portfolio quality and are expected to support positive U.S. net rooms growth in 2026.

• Awarded 22% more global franchise agreements in 2025, with significant growth in both U.S. and international markets.

Financial highlights

• Total revenues for 2025 were $1.60B, up slightly from $1.59B in 2024; Q4 revenues were flat at $390M.

• Fourth quarter 2025 revenues (excluding reimbursables) rose 2% year-over-year to $234 million; adjusted EBITDA was $141 million; adjusted EPS up 3% to $1.60.

• Net income for 2025 was $370M, up from $300M in 2024; Q4 net income was $64M, down from $76M in Q4 2024.

• Partnership revenues grew 14% year-over-year, with 16% growth in Q4, driven by co-brand and supplier fees.

• U.S. royalty rate expanded to 5.14% for 2025; average royalty rate increased 8 basis points in 2025 and 10 basis points in Q4.

Outlook and guidance

• 2026 adjusted EBITDA expected between $632 million and $647 million; adjusted EPS guidance of $6.92–$7.14.

• Net global rooms growth projected at ~1% year-over-year, with U.S. net rooms growth returning to positive territory.

• Global and U.S. RevPAR growth expected to range from -2% to 1% year-over-year.

• Average royalty rate and adjusted SG&A both expected to grow in the mid-single digits.

• Net hotel development outlays for 2026 expected at $20–$45 million, down 70% from 2025.