Choice Hotels International Inc
Q3 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +0.89%.
Did CHH Beat Earnings? Q3 2025 Results
Choice Hotels International delivered a mixed third quarter for 2025, topping revenue expectations while falling short on the bottom line. Revenue climbed 4.5% year-over-year to $447.34 million, well ahead of the $417.06 million consensus, yet adjusted diluted EPS of $2.10 missed the $2.20 estimate by 4.39%, dragged lower by acquisition-related amortization, a temporary tax expense increase, and unrealized foreign currency adjustments tied to the company's full buyout of Choice Hotels Canada. The Canada acquisition proved central to the quarter's story in multiple ways, as a $100.03 million fair-value remeasurement gain lifted GAAP net income to $180 million but obscured softer underlying domestic performance, with U.S. RevPAR declining 3.2% on weaker government and international inbound travel. International operations offered a meaningful counterweight, with RevPAR rising 9.5% and net rooms growing 8.3%, momentum the company is extending through a newly announced African market entry. Looking ahead, Choice Hotels guided full-year adjusted EPS to $6.82 to $7.05, with U.S. RevPAR growth now tightened to a range of negative 3% to negative 2%.
- Portfolio shift toward higher-value upscale, extended stay, and midscale brand segments
- International RevPAR growth of 9.5% offsetting U.S. RevPAR decline of 3.2%
- Adjusted EBITDA grew 7% to $190.1 million, a third-quarter record
- $100 million gain from fair value remeasurement of previously held 50% equity investment in Choice Hotels Canada
- U.S. average royalty rate expanded 10 basis points to 5.15%
- Partnership services and fees grew 19% year-over-year
- Global franchise agreements awarded grew 54%
- U.S. extended stay net rooms grew 12%
- 80% of 2025 openings expected from conversions, which open 80% faster than new construction
“Choice Hotels International delivered another quarter of record profitability, underscoring the strength of our portfolio's continued shift toward higher-value brand segments and multiple growth avenues beyond U.S. RevPAR.”
Choice Hotels CEO, on the earnings call
Forward Guidance & Outlook
Choice Hotels revised its full-year 2025 guidance. Net income is now expected at $353–$371 million (up from prior $261–$276 million, primarily reflecting the ~$100 million Canada JV acquisition gain). Adjusted net income is guided at $320–$331 million (prior $324–$339 million). Adjusted EBITDA is expected at $620–$632 million (prior $615–$635 million). Full-year diluted EPS is guided at $7.52–$7.89 (prior $5.54–$5.86) and adjusted diluted EPS at $6.82–$7.05 (prior $6.88–$7.20). U.S. RevPAR growth guidance was tightened to -3% to -2% (from -3% to 0%), reflecting softer government and international inbound demand. U.S. average royalty rate growth is expected at mid-single digits. Global net system rooms growth is expected at approximately 1%. The recurring effective tax rate is expected at 25%.
CHH YoY Financials
CHH Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.