Choice Hotels Q3 net income falls 68% to $58M
Higher full-year RevPAR ranges and the Harvest Hosts acquisition accompany lower net income guidance and two post-quarter hotel sales.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
8-K
Rhea-AI Filing Summary
Choice Hotels International, Inc. (CHH) reported third-quarter 2026 net income of $58 million, down 68% from a year earlier, when results included a $100 million gain from a joint-venture acquisition. The quarter also included a $24 million contract-termination charge and a $6 million non-cash impairment charge. Adjusted EBITDA was $193 million, up 1%, and adjusted diluted EPS was $2.33, up 11%. Franchise and management fees rose 5% to $204 million.
U.S. RevPAR grew 3.8% and global rooms grew 1.7% year over year. Choice acquired Harvest Hosts on October 1, 2026, for approximately $130 million, funded with available cash and revolving-credit borrowings; after quarter-end, it sold two owned hotels for approximately $34 million in estimated net cash proceeds, retaining franchise agreements. Full-year 2026 RevPAR outlook increased to 1.5%–2.5% for both the U.S. and global systems, and adjusted EBITDA guidance is $641 million to $651 million; net income guidance was lowered to $178 million to $185 million. Nine-month operating cash flow was $122 million, versus $185 million a year earlier.
3 points · 1 major1 major · 3 points
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Major point. Forward-looking: it has not happened yet and may not happen.Full-year adjusted EBITDA outlook rose to $641 million to $651 million.
- Moderate pointAdjusted diluted EPS increased 11% to $2.33 in the third quarter.
- Moderate pointThird-quarter franchise and management fees increased 5% to $204 million.
Negative
- Major point. Forward-looking: it has not happened yet and may not happen.Full-year net income guidance was lowered to $178 million to $185 million.
- Moderate pointThird-quarter net income fell 68% to $58 million.
- Moderate pointNine-month operating cash flow declined to $122 million from $185 million.
Insights
Analyzing...
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
Net income: $58 million
Adjusted EBITDA: $193 million
Adjusted diluted EPS: $2.33
+5 more
8 metrics
Net income
$58 million
Third quarter 2026; down 68% from the third quarter of 2025
Adjusted EBITDA
$193 million
Third quarter 2026; up 1% from the third quarter of 2025
Adjusted diluted EPS
$2.33
Third quarter 2026; up 11% from the third quarter of 2025
U.S. RevPAR growth
3.8%
Third quarter 2026 compared with the same period of 2025
Operating cash flow
$122 million
Nine months ended September 30, 2026, compared with $185 million in the prior-year period
Harvest Hosts acquisition
Approximately $130 million
Acquired October 1, 2026
Adjusted EBITDA guidance
$641 million to $651 million
Full-year 2026 outlook
Net income guidance
$178 million to $185 million
Full-year 2026 outlook
Key Terms
RevPAR, Adjusted EBITDA, conversion pipeline, net debt-to-adjusted EBITDA ratio
4 terms
RevPAR financial
"U.S. RevPAR increased 3.8% in the third quarter"
RevPAR, or revenue per available room, is a measure used in the hotel industry to show how much money a hotel earns from each of its rooms over a certain period. It helps investors understand how well a hotel is performing financially, similar to how a store's sales per square foot reveal its profitability. Higher RevPAR indicates better use of resources and stronger financial health.
Adjusted EBITDA financial
"Adjusted EBITDA increased 1% to $193 million"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
conversion pipeline technical
"The U.S. conversion pipeline grew to 25,500 rooms"
net debt-to-adjusted EBITDA ratio financial
"The Company's net debt-to-adjusted EBITDA ratio was 3.2x"
Net debt-to-adjusted EBITDA ratio compares a company's net debt (total borrowings minus cash) to its core annual earnings before interest, taxes, depreciation and amortization after removing one-time or unusual items. It tells investors how many years of those normalized operating earnings would be needed to pay off the company's net debt, like comparing remaining mortgage debt to a household’s steady take-home pay to judge financial strain and default risk.
Earnings Snapshot
Net income: $58 million · Guidance included
Third quarter 2026
Net income
$58 million
Down 68% year over year
Adjusted EBITDA
$193 million
Up 1% year over year
Adjusted diluted EPS
$2.33
Up 11% year over year
U.S. RevPAR
3.8% growth
Compared with the same period of 2025
Guidance
Full-year 2026 net income of $178 million to $185 million; adjusted EBITDA of $641 million to $651 million; U.S. and global RevPAR growth of 1.5% to 2.5% each.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What was CHH's net income in third-quarter 2026?
CHH reported net income of $58 million for the third quarter ended September 30, 2026, or $1.28 per diluted share; net income was down 68% from the prior-year quarter.
What is CHH's full-year 2026 earnings and RevPAR outlook?
Choice's updated outlook gives full-year net income of $178 million to $185 million and adjusted EBITDA of $641 million to $651 million. The company raised its U.S. and global RevPAR growth outlooks to 1.5% to 2.5% for each.
How many rooms were in CHH's development pipeline?
Choice's global pipeline totaled 78,200 rooms as of September 30, 2026, with 96% concentrated in extended stay, midscale, and upscale brands. It included 71,700 U.S. rooms and 6,500 international rooms.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________________________________
FORM 8-K
_____________________________________________________
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 2, 2026
_____________________________________________________
CHOICE HOTELS INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
_____________________________________________________
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) | ||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
Registrant’s telephone number, including area code (301 ) 592-5000
_____________________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Ticker Symbol(s) | Name of Each Exchange on Which Registered | ||||||||||||
| Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). | |||||
| Emerging growth company | |||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | |||||
| Item 2.02. | Results of Operations and Financial Condition. | ||||
On November 2, 2026 , Choice Hotels International, Inc. issued a press release announcing earnings for the quarter ended September 30, 2026. A copy of the release is furnished herewith as Exhibit 99.1.
| Item 9.01. | Financial Statements and Exhibits. | ||||
(d) Exhibits
Exhibit 99.1—Press Release issued by Choice Hotels International, Inc., dated November 2, 2026
Exhibit 104—Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: | /s/ Scott E. Oaksmith | |||||||||||||||||||
| Scott E. Oaksmith | ||||||||||||||||||||
| Chief Financial Officer | ||||||||||||||||||||
CHOICE HOTELS INTERNATIONAL REPORTS THIRD QUARTER 2026 RESULTS
U.S. Net Rooms Growth Rate Improves for Third Consecutive Quarter
Owned Hotel Sales Advance Asset-Light Strategy
Full-Year 2026 RevPAR Outlook Raised
NORTH BETHESDA, Md., Nov. 2, 2026 – Choice Hotels International, Inc. (“Choice” or “the Company”) (NYSE: CHH), a leading global lodging franchisor with an asset-light model, today reported results for the third quarter ended September 30, 2026.
Highlights include:
•Net income was $58 million, or $1.28 per diluted share, for the third quarter.
•Adjusted EBITDA totaled $193 million and adjusted diluted EPS was $2.33 for the third quarter.
•The U.S. year-over-year net rooms growth rate continued to improve, with U.S. rooms approximately flat compared to September 30, 2025, as third-quarter room exits declined 23% compared to the same period of 2025.
•Global net rooms grew 1.7% compared to September 30, 2025, led by 2.5% growth across the higher-revenue extended stay, midscale, and upscale brands.
•U.S. RevPAR increased 3.8% in the third quarter compared to the same period of 2025, reflecting improvements in both occupancy and rate.
•U.S. franchise agreements awarded increased 24% in the third quarter compared to the same period of 2025, representing 6,900 new rooms for development.
•The U.S. conversion pipeline grew to 25,500 rooms, an increase of 6% from June 30, 2026, and 29% from September 30, 2025, driving sequential growth in the total U.S. pipeline.
•The U.S. average royalty rate expanded 8 basis points to 5.23% in the third quarter compared to the same period of 2025.
•Subsequent to quarter-end, the Company completed the sale of two owned hotels for estimated net cash proceeds of approximately $34 million, while retaining franchise agreements for both properties.
•The Company returned $211 million to shareholders through dividends and share repurchases during the first nine months of 2026.
•The Company raised its full-year U.S. and global RevPAR outlooks, revised its net income guidance, and raised its adjusted EBITDA guidance range.
“Our third-quarter results reflect continued progress against our key priorities: the U.S. net rooms growth rate improved for the third consecutive quarter, U.S. RevPAR growth strengthened, and capital recycling is underway,” said Dom Dragisich, President and Chief Executive Officer. “Our focus is on returning to the fundamentals that have driven our success for decades, while continuing to invest in commercial and technology capabilities that help franchisees capture more demand. We expect U.S. net rooms growth to accelerate to approximately 1% by year-end, and stronger demand trends support our increased full-year RevPAR outlook. These improvements position us to deliver more consistent financial performance and stronger long-term free cash flow for shareholders.”
Financial Performance
($ in millions, except per-share amounts) | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||||
Total revenues | $458 | $447 | $1,240 | $1,207 | ||||||||||
Revenue excl. revenue for reimbursable costs from franchised and managed properties1 | $285 | $278 | $780 | $746 | ||||||||||
Net income | $58 | $180 | $143 | $306 | ||||||||||
Diluted EPS | $1.28 | $3.86 | $3.12 | $6.52 | ||||||||||
Adjusted net income | $105 | $98 | $247 | $252 | ||||||||||
Adjusted diluted EPS | $2.33 | $2.10 | $5.41 | $5.36 | ||||||||||
Adjusted EBITDA | $193 | $190 | $494 | $485 | ||||||||||
•Net income was $58 million for the third quarter, a 68% decline compared to the same period of 2025. The decline primarily reflected a $100 million gain from the acquisition of a joint venture recognized in the prior-year quarter. Current-year results included a $24 million charge related to the termination of an arrangement involving an option to acquire a European hospitality business operating primarily under a lease-based model and a $6 million non-cash impairment charge related to two owned hotels. These impacts were partially offset by higher franchise and management fees. The prior-year gain and both current-year charges are excluded from adjusted results.
•Adjusted EBITDA increased 1% to $193 million for the third quarter compared to the same period of 2025, primarily driven by higher U.S. royalties, partially offset by lower liquidated damages revenue and higher adjusted SG&A expenses. Excluding liquidated damages revenue of $3.3 million and $9.5 million in the third quarters of 2026 and 2025, respectively, adjusted EBITDA increased 5% compared to the same period of 2025.
•Adjusted diluted EPS increased 11% for the third quarter compared to the same period of 2025, benefiting from higher franchise and management fees and share repurchases.
•Franchise and management fees increased 5% to $204 million for the third quarter compared to the same period of 2025, primarily reflecting higher U.S. royalties driven by RevPAR growth
1 Calculated as total revenues excluding reimbursable revenues. Reimbursable revenues totaled $173 million and $169 million for third quarter 2026 and 2025, respectively, and $460 million and $460 million for each of the nine-month periods ended September 30, 2026 and 2025. Excluding liquidated damages revenue of $3.3 million and $9.5 million in the third quarters of 2026 and 2025, respectively, revenues excluding reimbursable revenues increased 5% in the third quarter compared to the same period of 2025.
and royalty rate expansion, increased franchisee programs and services revenue, and higher international royalties.
RevPAR
(% change on a currency-neutral basis) | Change vs. Prior Year Period | ||||
Three months ended September 30, 2026 | |||||
U.S. | 3.8% | ||||
International | 3.7% | ||||
Global | 3.9% | ||||
•U.S. RevPAR increased 3.8% in the third quarter compared to the same period of 2025, driven by a 1.0% increase in rate and a 160-basis-point increase in occupancy, with strength in the West South Central and Midwest regions.
•International RevPAR increased 3.7% on a currency-neutral basis in the third quarter compared to the same period of 2025, reflecting growth across all regions, led by strength in the Caribbean and Latin America.
System Size and Development
| (Rooms) | |||||||||||
| September 30, 2026 | September 30, 2025 | Change | |||||||||
| U.S. | 498,215 | 498,307 | —% | ||||||||
| U.S. upscale, extended stay, and midscale | 442,154 | 438,865 | 0.7% | ||||||||
| International | 162,399 | 151,370 | 7.3% | ||||||||
| Global | 660,614 | 649,677 | 1.7% | ||||||||
| Global upscale, extended stay, and midscale | 599,303 | 584,914 | 2.5% | ||||||||
•Global room openings totaled 6,000 in the third quarter, compared to 12,800 in the same period of 2025, which included a 7,400-room international portfolio conversion.
•U.S. room openings totaled 4,400 in the third quarter, compared to 4,800 in the same period of 2025. For the nine months ended September 30, 2026, U.S. room openings increased 17% compared to the same period of 2025.
•Global extended stay net rooms grew 10.7% compared to September 30, 2025, marking the 13th consecutive quarter of double-digit growth. During the quarter, the Company also opened its 600th extended stay hotel.
•International net rooms grew 7.3% compared to September 30, 2025, led by growth in EMEA, Asia-Pacific, and Canada.
•Global franchise agreements awarded represented 9,000 new rooms for development in the third quarter, compared to 11,800 rooms in the same period of 2025, which included a 4,900-room international portfolio signing. In the U.S., franchise agreements awarded represented 6,900 rooms, compared with 5,500 rooms in the same period of 2025.
•The Company's global pipeline totaled 78,200 rooms as of September 30, 2026, with 96% concentrated in extended stay, midscale, and upscale brands. The pipeline included:
◦71,700 U.S. rooms and 6,500 international rooms.
◦30,300 extended stay rooms, representing 39% of the total pipeline.
◦28,100 conversion rooms and 50,100 new-construction rooms.
Balance Sheet and Liquidity
As of September 30, 2026, the Company had total available liquidity of $928 million, consisting of cash and cash equivalents and available borrowing capacity. The Company's net debt-to-adjusted EBITDA ratio was 3.2x for the trailing twelve months ended September 30, 2026, within its target range of 3.0x to 4.0x. The quarter-end cash balance included borrowings made in advance of the October 1, 2026, acquisition of Harvest Hosts. Following the acquisition, net leverage remained within the Company's target range.
In August 2026, the Company completed a $500 million unsecured term loan financing, reducing the borrowing spread on the refinanced debt by 15 basis points and increasing available capacity under its $1 billion revolving credit facility. The term loan matures in August 2029.
During the nine months ended September 30, 2026, the Company generated $122 million in cash flows from operating activities, compared to $185 million in the prior-year period. The decrease primarily reflected the contract termination payment, higher franchise agreement acquisition costs associated with a 17% increase in U.S. room openings, and higher marketing and reservation system reimbursable expenses, partially offset by deferred tax and working capital timing effects.
Asset Recycling
During the nine months ended September 30, 2026, net capital outlays for hotel development and lending activities declined 56% to $36.3 million, compared to $82.0 million in the prior-year period.2
The Company advanced its return to an asset-light franchising model through sales from its owned hotel portfolio. Subsequent to quarter-end, the Company sold two owned hotels, generating estimated net cash proceeds of approximately $34 million while retaining franchise agreements for both properties. As of November 2, 2026, the Company owned 17 operating hotels, with one additional hotel under construction.
Acquisition
On October 1, 2026, the Company acquired Harvest Hosts, an asset-light RV travel subscription platform with recurring revenue, expanding Choice Hotels’ offerings for value-minded travelers into the outdoor travel market. The approximately $130 million transaction was funded with available cash and borrowings under the Company’s revolving credit facility.
Shareholder Returns
During the nine months ended September 30, 2026, the Company returned $39 million to shareholders through dividends and $172 million in share repurchases.3
2 Net capital outlays include investments in owned hotel properties, investments in affiliates, notes receivable issued, net of collections, proceeds from asset sales, and distributions from sales of affiliates.
3 Share repurchases include repurchases under the Company's stock repurchase program and repurchases from employees in connection with tax withholding and option exercises relating to awards under the Company's equity incentive plans.
As of September 30, 2026, 1.3 million shares of common stock remained available for repurchase under the Company’s current share repurchase authorization.
Outlook
The Company is updating certain aspects of its full-year 2026 outlook. The outlook includes forward-looking non-GAAP measures used by management to assess expected performance. Adjusted metrics exclude the net surplus or deficit from reimbursable activities related to franchised and managed properties, due diligence and transition costs, and other items. The outlook includes Harvest Hosts’ operating results from the October 1, 2026, acquisition date and reflects the impact of the Company’s two recent hotel dispositions, except as otherwise noted.
| Full-Year 2026 | Prior Outlook | |||||||
| Net income | $178 to $185 million | $230 to $241 million | ||||||
| Diluted EPS | $3.92 to $4.07 | $5.07 to $5.31 | ||||||
| Adjusted net income | $315 to $322 million | $312 to $323 million | ||||||
| Adjusted EBITDA | $641 to $651 million | $635 to $650 million | ||||||
| Adjusted SG&A growth, excluding Harvest Hosts | Approximately 9% | Mid-single digits | ||||||
| Adjusted diluted EPS | $6.92 to $7.07 | $6.86 to $7.10 | ||||||
| Effective tax rate | 26% | 26% | ||||||
| Full-Year 2026 vs. 2025 | Prior Outlook | |||||||
| Global RevPAR growth | 1.5% to 2.5% | 0% to 1% | ||||||
| U.S. RevPAR growth | 1.5% to 2.5% | 0% to 1.25% | ||||||
| U.S. royalty rate growth | Approximately 9 bps | 7 bps to 9 bps | ||||||
| Global net system rooms growth | Approximately 1.5% | Approximately 1.5% | ||||||
The net income guidance range has been lowered from the Company's prior outlook primarily to reflect higher expected marketing and reservation system reimbursable expenses, driven by increased investment in franchisee-facing tools and guest delivery capabilities. The revision also reflects a $24 million charge related to the termination of an arrangement that included an option to acquire a European hospitality business, $6 million in non-cash impairment charges related to owned hotels, lower expected equity in earnings of affiliates, and higher interest expense.
The adjusted net income guidance range has been narrowed from the Company's prior outlook to reflect higher expected adjusted EBITDA, higher interest expense, and lower expected equity in earnings of affiliates.
The Company raised the midpoint of its adjusted EBITDA guidance range, primarily reflecting stronger global RevPAR, higher U.S. royalty rate expansion, and an estimated $1 million net benefit from the Harvest Host acquisition and two recent hotel dispositions, partially offset by higher adjusted SG&A expenses. The revised adjusted SG&A outlook, excluding Harvest Host, reflects primarily non-recurring spending on certain strategic initiatives and artificial intelligence-enabled capabilities, as well as higher accounts receivable reserves.
Net capital outlays for hotel development-related activities are expected to decline from $103.4 million in 2025 to approximately $20 million in 2026, assuming no additional hotel sales.2
Webcast and Conference Call
Choice will host a conference call to discuss third quarter 2026 results on November 2, 2026, at 10:00 a.m. ET. A live webcast will be available on the Company’s Investor Relations website at www.investor.choicehotels.com/events-and-presentations. Participants may also dial (833) 461-5787 (U.S.) or (585) 542-9983 (international) and reference conference ID 723141180. A replay and transcript will be available within 24 hours on the Company’s Investor Relations website.
About Choice Hotels®
Choice Hotels International, Inc. (NYSE: CHH) is one of the largest lodging franchisors in the world, with over 7,500 hotels, representing more than 650,000 rooms, in 50 countries and territories. A wide-ranging portfolio of 22 brands that includes full-service upper upscale, midscale, extended stay, and economy properties enables Choice® to meet travelers’ needs in more places and for more occasions while driving more value for franchise owners and shareholders. The award-winning Choice Privileges® rewards program and co-brand credit card options provide members with a fast and easy way to earn reward nights and personalized perks. For more information, visit www.choicehotels.com.
Forward-Looking Statements
Information set forth herein includes “forward-looking statements.” Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “expect,” “estimate,” “believe,” “anticipate,” “should,” “will,” “forecast,” “plan,” “project,” “assume,” or similar words of futurity. All statements other than historical facts are forward-looking statements. These forward-looking statements are based on management’s current beliefs, assumptions, and expectations regarding future events, which in turn are based on information currently available to management. Such statements may relate to projections of Choice’s revenue, expenses, adjusted EBITDA, earnings, debt levels, ability to repay outstanding indebtedness, payment of dividends, net surplus or deficit, repurchases of common stock and other financial and operational measures, including occupancy, room openings and growth, open hotels, RevPAR, royalty rate, strategic investment and acquisition performance, asset recycling, international expansion performance, macroeconomic backdrop, commercial and technological capabilities, and Choice’s liquidity, among other matters. We caution you not to place undue reliance on any such forward-looking statements. Forward-looking statements do not guarantee future performance and involve known and unknown risks, uncertainties, and other factors.
Several factors could cause our actual results, performance or achievements to differ materially from those expressed in or contemplated by the forward-looking statements. Such risks include, but are not limited to, changes to general, U.S. and foreign economic conditions, including access to liquidity and capital; changes in consumer demand and confidence, including consumer discretionary spending and the demand for travel, transient and group business; the timing and amount of future dividends and share repurchases; future U.S. or global outbreaks of epidemics, pandemics or contagious diseases or fear of such outbreaks, and the related impact on the global hospitality industry, particularly but not exclusively the U.S. travel market; changes in law and regulation applicable to the travel, lodging or franchising industries, including with respect to the status of our relationship with employees of our franchisees; the potential impact of changes in laws and regulations generally, or the interpretation thereof, including, without limitation, those relating to taxes, wages, labor and immigration; foreign currency fluctuations; changes in global interest rates and rate differentials; variability and unpredictability in trade relations, sanctions, tariffs or other trade controls; governmental action or inaction relating to the federal budget, including funding lapses and
government shutdowns; impairments or declines in the value of our assets; our assumptions underlying our critical accounting estimates; operating risks common in the travel, lodging or franchising industries; changes to the desirability of our brands as viewed by hotel operators and customers; changes to the terms or termination of our contracts with franchisees and our relationships with our franchisees; our ability to keep pace with improvements in technology utilized for our marketing and reservation systems and other operating systems; our ability to grow our franchise system; exposure to risks related to our hotel development, financing, franchise agreement acquisition costs and ownership activities; exposures to risks associated with our investments in new businesses; fluctuations in the supply and demand for hotel rooms; our ability to realize anticipated benefits from acquired businesses; impairments or losses relating to acquired businesses; the level of acceptance of alternative growth strategies we may implement; the impact of inflation; information technology, cyber security and data breach risks; introduction and integration of artificial intelligence technologies; climate change; our sustainability strategy; ownership and financing activities; hotel closures or financial difficulties of our franchisees; operating risks associated with our international operations; political instability, geopolitical conflicts and terrorism; labor shortages; the outcome of litigation; our ability to effectively manage our indebtedness and secure our indebtedness; and the integration and performance of Harvest Hosts following our acquisition.
These and other risk factors are discussed in detail in the Company’s filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
Non-GAAP Financial Measurements and Other Definitions
The company evaluates its operations utilizing the performance metrics of adjusted EBITDA, adjusted selling, general and administrative (SG&A) expenses, adjusted net income, and adjusted diluted EPS, which are all non-GAAP financial measurements. These measures, which are reconciled to the comparable GAAP measures in Exhibits 6 and 7, should not be considered as an alternative to any measure of performance or liquidity as promulgated under or authorized by GAAP, such as SG&A, net income and EPS. The company’s calculation of these measurements may be different from the calculations used by other companies and comparability may therefore be limited. Management believes these non-GAAP financial measures provide investors with additional meaningful financial information that should be considered when assessing our underlying business performance and trends. We further discuss management’s reasons for reporting these non-GAAP measures and how each non-GAAP measure is calculated below.
In addition to the specific adjustments noted below with respect to each measure, the non-GAAP measures presented herein also exclude restructuring of the company’s operations including employee severance benefit, contract termination costs, legal costs, acquisition related to business combination, due diligence and transition (recoveries) costs, and global ERP system implementation and related costs to allow for period-over-period comparison of ongoing core operations before the impact of these discrete and infrequent charges.
The non-GAAP measures presented herein also include certain information regarding projected non-GAAP adjusted EBITDA contributions from the estimated benefit from the Harvest Host acquisition, which we are unable to reconcile to similar projections of net income without unreasonable efforts as the adjustments cannot reasonably be predicted. The impact of the unavailable information could be significant relative to our expectations.
Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization: Adjusted EBITDA, presented herein, is calculated as net income excluding the impact of interest expense, interest income, provision for income taxes, depreciation and amortization, amortization of cloud computing
arrangements, impairments and gains on sale of business, joint ventures and assets, other (gains) and losses, equity in net income (loss) of unconsolidated affiliates and (gain) loss on extinguishment of debt, further adjusted to exclude certain items, including, franchisee agreement acquisition cost amortization and charges, mark-to-market adjustments on non-qualified retirement plan investments, share based compensation expense (benefit) and surplus or deficits generated by reimbursable revenue from franchised and managed properties. We consider adjusted EBITDA to be an indicator of operating performance because it measures our ability to service debt, fund capital expenditures, and expand our business. We also use these measures, as do analysts, lenders, investors, and others, to evaluate companies because they exclude certain items that can vary widely across industries or among companies within the same industry. For example, interest expense can be dependent on a company’s capital structure, debt levels, and credit ratings, and share based compensation expense (benefit) is dependent on the design of compensation plans in place and the usage of them. Accordingly, the impact of interest expense and share based compensation expense (benefit) on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provision for income taxes can vary considerably among companies. These measures also exclude depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets or amortizing franchise-agreement acquisition costs. These differences can result in considerable variability in the relative asset costs and estimated lives and, therefore, the depreciation and amortization expense among companies. Mark-to-market adjustments on non-qualified retirement-plan investments recorded in SG&A expenses are excluded from adjusted EBITDA, as the company accounts for these investments in accordance with accounting for deferred-compensation arrangements when investments are held in a rabbi trust and invested. Changes in the fair value of the investments are recognized as both compensation expense in SG&A and other gains and losses. As a result, the changes in the fair value of the investments do not have a material impact on the company’s net income. Surpluses and deficits generated from reimbursable revenues from franchised and managed properties are excluded, as the company does not operate these programs to generate a profit and has the contractual rights to adjust future collections or assess additional fees to recover prior period expenditures. The company’s franchise and management agreements require these revenues to be used exclusively for expenses associated with providing franchise and management services, such as central reservation systems, hotel employee and operating costs, reservation delivery and national marketing and media advertising. Franchised and managed property owners are required to reimburse the company for any deficits generated from these activities and the company is required to spend any surpluses generated in future periods. The reimbursement for franchise and management services is typically billed and collected monthly, based on the underlying hotel’s sales or usage, while the associated costs are recognized as incurred by the company, creating timing differences with the net effect impacting net income in the reporting period. These timing differences are due to our discretion to spend in excess of the revenues earned or less than the revenues earned in a single period to ensure that the programs are operated in the best long-term interests of our franchised and managed properties. Since these activities will be managed to break-even over time, quarterly or annual surpluses and deficits have been excluded from the measurements utilized to assess the company’s operating performance.
Adjusted Net Income and Adjusted Diluted Earnings Per Share: Adjusted net income and adjusted diluted EPS exclude the impact of surpluses or deficits generated from reimbursable revenue from franchised and managed properties, impairments, formation costs and gains on sale of business, joint ventures and assets and gains on extinguishment of debt. Surpluses and deficits generated from reimbursable revenue from franchised and managed properties are excluded, as the company does not operate these programs to generate a profit and has the contractual rights to adjust future collections or assess additional fees to recover prior period expenditures. The company’s franchise agreements require these revenues to be used exclusively for expenses associated with providing franchised and managed services, such as central reservation systems,
hotel employee and operating costs, reservation delivery and national marketing and media advertising. Franchised and managed property owners are required to reimburse the company for any deficits generated from activities and the company is required to spend any surpluses generated in future periods. The reimbursement for franchise and management services is typically billed and collected monthly, based on the underlying hotel’s sales or usage, while the associated costs are recognized as incurred by the company, creating timing differences with the net effect impacting net income in the reporting period. These timing differences are due to our discretion to spend in excess of the revenues earned or less than the revenues earned in a single period to ensure that the programs are operated in the best long-term interests of our franchised and managed properties. Since these activities will be managed to break-even over time, quarterly or annual surpluses and deficits have been excluded from the measurements utilized to assess the company’s operating performance. We consider adjusted net income and adjusted diluted EPS to be indicators of operating performance because excluding these items allows for period-over-period comparisons of our ongoing operations.
Adjusted SG&A: Adjusted SG&A reflects SG&A excluding the impact of mark-to-market adjustments on non-qualified retirement plan investments, amortization of cloud computing arrangements and share based compensation expense. We use this measure, as do analysts, lenders, investors, and others, to evaluate companies because it excludes certain items that can vary widely across industries or among companies within the same industry. For example, share based compensation expense (benefit) is dependent on the design of compensation plans in place and the usage of them. Accordingly, the impact of share-based compensation expense (benefit) on earnings can vary significantly among companies. Mark-to-market adjustments on non-qualified retirement-plan investments recorded in SG&A expenses are also excluded as the company accounts for these investments in accordance with accounting for deferred-compensation arrangements when investments are held in a rabbi trust and invested. Changes in the fair value of the investments are recognized as both compensation expense in SG&A and other gains and losses. As a result, the changes in the fair value of the investments do not have a material impact on the company’s net income.
Occupancy: Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel for a given period. Occupancy measures the utilization of the hotels’ available capacity. Management uses occupancy to gauge demand at a specific hotel or group of hotels in a given period. The company calculates occupancy based on information as reported by its franchisees. To accurately reflect occupancy, the company may revise its prior years’ operating statistics for the most current information provided.
Average Daily Rate (ADR): ADR represents hotel room revenue divided by the total number of room nights sold for a given period. ADR measures the average room price attained by a hotel and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels. ADR is a commonly used performance measure in the industry, and management uses ADR to assess pricing levels that the company is able to generate. The company calculates ADR based on information as reported by its franchisees. To accurately reflect ADR, the company may revise its prior years’ operating statistics for the most current information provided.
Revenue Per Available Room (RevPAR): RevPAR is calculated by dividing hotel room revenue by the total number of room nights available to guests for a given period. Management considers RevPAR to be a meaningful indicator of hotel performance and therefore company royalty and system revenues as it provides a metric correlated to the two key drivers of operations at a hotel: occupancy and ADR. The company calculates RevPAR based on information as reported by its franchisees. To accurately reflect RevPAR, the company may revise its prior years’ operating statistics for the most current information provided. RevPAR is also a useful indicator in measuring performance over comparable periods.
Pipeline: Pipeline is defined as hotels awaiting conversion, under construction or approved for development, and master development agreements committing owners to future franchise development.
Contacts
Allie Summers, Senior Director, Investor Relations
IR@choicehotels.com
© 2026 Choice Hotels International, Inc. All rights reserved.
Choice Hotels International, Inc.
Earnings Release Schedules
Table of Contents
| Page No. | |||||
Condensed Consolidated Statements of Income | 12 | ||||
Condensed Consolidated Balance Sheets | 13 | ||||
Condensed Consolidated Statements of Cash Flows | 14 | ||||
Currency-Neutral System-Wide Hotel Operating Statistics | 14 | ||||
System Hotel and Room Supply | 16 | ||||
Non-GAAP Financial Information | 17 | ||||
Outlook | 19 | ||||
| Choice Hotels International, Inc. | Exhibit 1 | |||||||||||||||||||||||||
| Condensed Consolidated Statements of Income | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| (In thousands, except per share amounts) | For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| REVENUES | ||||||||||||||||||||||||||
| Franchise and management fees | $ | 203,667 | $ | 193,777 | $ | 540,834 | $ | 515,931 | ||||||||||||||||||
| Partnership services and fees | 28,341 | 28,868 | 81,749 | 81,313 | ||||||||||||||||||||||
| Owned hotels | 38,064 | 33,167 | 103,393 | 91,255 | ||||||||||||||||||||||
| Other | 15,320 | 22,094 | 53,525 | 57,937 | ||||||||||||||||||||||
| Revenue for reimbursable costs from franchised and managed properties | 172,936 | 169,434 | 460,164 | 460,207 | ||||||||||||||||||||||
| Total revenues | 458,328 | 447,340 | 1,239,665 | 1,206,643 | ||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Selling, general and administrative | 81,275 | 79,610 | 255,474 | 243,118 | ||||||||||||||||||||||
| Contract termination costs | 24,268 | — | 24,268 | — | ||||||||||||||||||||||
| Business combination, diligence and transition costs | 3,214 | 1,494 | 3,986 | 1,940 | ||||||||||||||||||||||
| Depreciation and amortization | 16,933 | 15,760 | 50,567 | 42,932 | ||||||||||||||||||||||
| Owned hotels | 27,312 | 23,792 | 76,420 | 67,271 | ||||||||||||||||||||||
| Reimbursable expenses from franchised and managed properties | 192,812 | 184,268 | 552,264 | 504,437 | ||||||||||||||||||||||
| Total operating expenses | 345,814 | 304,924 | 962,979 | 859,698 | ||||||||||||||||||||||
| Impairment of long-lived assets | (6,035) | — | (6,035) | — | ||||||||||||||||||||||
| Operating income | 106,479 | 142,416 | 270,651 | 346,945 | ||||||||||||||||||||||
| OTHER EXPENSES AND (INCOME), NET | ||||||||||||||||||||||||||
| Interest expense | 25,575 | 23,490 | 73,796 | 67,468 | ||||||||||||||||||||||
| Interest income | (998) | (1,435) | (3,304) | (4,450) | ||||||||||||||||||||||
| Gain from an acquisition of a joint venture | — | (100,025) | — | (100,025) | ||||||||||||||||||||||
| Gain on sale of assets | — | (713) | — | (713) | ||||||||||||||||||||||
| Other gains, net | (7) | (721) | (5,410) | (5,659) | ||||||||||||||||||||||
| Equity in net loss of affiliates | 6,866 | 10,904 | 14,334 | 11,035 | ||||||||||||||||||||||
| Total other expenses and (income), net | 31,436 | (68,500) | 79,416 | (32,344) | ||||||||||||||||||||||
| Income before income taxes | 75,043 | 210,916 | 191,235 | 379,289 | ||||||||||||||||||||||
| Income tax expense | 17,131 | 30,920 | 48,681 | 73,025 | ||||||||||||||||||||||
| Net income | $ | 57,912 | $ | 179,996 | $ | 142,554 | $ | 306,264 | ||||||||||||||||||
| Basic earnings per share | $ | 1.29 | $ | 3.89 | $ | 3.14 | $ | 6.59 | ||||||||||||||||||
| Diluted earnings per share | $ | 1.28 | $ | 3.86 | $ | 3.12 | $ | 6.52 | ||||||||||||||||||
| Choice Hotels International, Inc. | Exhibit 2 | |||||||||||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| (In thousands) | September 30, | December 31, | ||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Cash and cash equivalents | $ | 170,594 | $ | 44,997 | ||||||||||||||||
| Accounts receivable, net | 285,966 | 207,491 | ||||||||||||||||||
| Other current assets | 119,830 | 153,510 | ||||||||||||||||||
| Total current assets | 576,390 | 405,998 | ||||||||||||||||||
| Property and equipment, net | 645,102 | 649,291 | ||||||||||||||||||
| Operating lease right-of-use assets | 72,528 | 77,670 | ||||||||||||||||||
| Goodwill | 302,668 | 305,758 | ||||||||||||||||||
| Intangible assets, net | 1,119,107 | 1,082,486 | ||||||||||||||||||
| Notes receivable, net of allowances | 28,688 | 12,490 | ||||||||||||||||||
| Investments for employee benefit plans, at fair value | 47,549 | 50,227 | ||||||||||||||||||
| Investments in affiliates | 139,667 | 134,975 | ||||||||||||||||||
| Other assets | 207,235 | 199,308 | ||||||||||||||||||
| Total assets | $ | 3,138,934 | $ | 2,918,203 | ||||||||||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||
| Accounts payable | $ | 148,045 | $ | 156,276 | ||||||||||||||||
| Accrued expenses and other current liabilities | 117,443 | 125,282 | ||||||||||||||||||
| Deferred revenue | 107,680 | 100,698 | ||||||||||||||||||
| Liability for guest loyalty program | 84,863 | 85,035 | ||||||||||||||||||
| Total current liabilities | 458,031 | 467,291 | ||||||||||||||||||
| Long-term debt | 2,177,105 | 1,906,122 | ||||||||||||||||||
| Long-term deferred revenue | 135,975 | 130,505 | ||||||||||||||||||
| Deferred compensation and retirement plan obligations | 54,076 | 56,532 | ||||||||||||||||||
| Deferred income taxes | 32,416 | 25,303 | ||||||||||||||||||
| Operating lease liabilities | 102,315 | 107,963 | ||||||||||||||||||
| Liability for guest loyalty program | 42,731 | 39,771 | ||||||||||||||||||
| Other liabilities | 4,527 | 3,487 | ||||||||||||||||||
| Total liabilities | 3,007,176 | 2,736,974 | ||||||||||||||||||
| Total shareholders' equity | 131,758 | 181,229 | ||||||||||||||||||
| Total liabilities and shareholders' equity | $ | 3,138,934 | $ | 2,918,203 | ||||||||||||||||
| Choice Hotels International, Inc. | Exhibit 3 | ||||||||||
| Condensed Consolidated Statements of Cash Flows | |||||||||||
| (Unaudited) | |||||||||||
| (In thousands) | Nine Months Ended September 30, | ||||||||||
| 2026 | 2025 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
| Net income | $ | 142,554 | $ | 306,264 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 50,567 | 42,932 | |||||||||
| Depreciation and amortization – reimbursable expenses from franchised and managed properties | 17,076 | 14,295 | |||||||||
| Franchise agreement acquisition cost amortization | 30,051 | 25,020 | |||||||||
| Impairment of long-lived assets | 6,035 | — | |||||||||
| Gain from an acquisition of a joint venture | — | (100,025) | |||||||||
| Gain on sale of assets | — | (713) | |||||||||
| Non-cash share-based compensation and other charges | 16,841 | 27,439 | |||||||||
| Non-cash interest, investments, and affiliate loss (income), net | 1,000 | (6,131) | |||||||||
| Deferred income taxes | (581) | (17,713) | |||||||||
| Equity in net loss of affiliates, less distributions received | 10,529 | 16,424 | |||||||||
| Franchise agreement acquisition costs, net of reimbursements | (103,993) | (62,359) | |||||||||
| Change in working capital and other | (48,165) | (60,676) | |||||||||
| Net cash provided by operating activities | 121,914 | 184,757 | |||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||
| Investments in other property and equipment | (25,612) | (26,927) | |||||||||
| Investments in owned hotel properties | (37,533) | (85,307) | |||||||||
| Contributions to investments in affiliates | (20,038) | (90,005) | |||||||||
| Issuances of notes receivable | (3,338) | (6,351) | |||||||||
| Collections of notes receivable | 24,610 | 3,036 | |||||||||
| Business acquisition, net of cash acquired | — | (73,395) | |||||||||
| Proceeds from the sale of assets | — | 52,000 | |||||||||
| Distributions from sales of affiliates | — | 44,617 | |||||||||
| Other items, net | (1,232) | 4,475 | |||||||||
| Net cash used in investing activities | (63,143) | (177,857) | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
| Net (repayments) borrowings pursuant to revolving credit facilities | (228,725) | 148,482 | |||||||||
| Proceeds from the issuance of long-term debt | 499,500 | — | |||||||||
| Proceeds from economic development loans | — | 250 | |||||||||
| Debt issuance costs | (435) | — | |||||||||
| Purchases of treasury stock | (166,178) | (112,958) | |||||||||
| Dividends paid | (39,325) | (40,194) | |||||||||
| Proceeds from the exercise of stock options | 2,411 | 7,488 | |||||||||
| Net cash provided by financing activities | 67,248 | 3,068 | |||||||||
| Net change in cash and cash equivalents | 126,019 | 9,968 | |||||||||
| Effect of foreign exchange rate changes on cash and cash equivalents | (422) | 2,438 | |||||||||
| Cash and cash equivalents, beginning of period | 44,997 | 40,177 | |||||||||
| Cash and cash equivalents, end of period | $ | 170,594 | $ | 52,583 | |||||||
| Exhibit 4 | |||||||||||||||||||||||||||||||||||||||||
| CHOICE HOTELS INTERNATIONAL, INC. | |||||||||||||||||||||||||||||||||||||||||
| CURRENCY-NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS | |||||||||||||||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||||||||||||||
| For the Three Months Ended September 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| ADR | Occupancy | RevPAR | |||||||||||||||||||||||||||||||||||||||
| 2026 | vs. 2025 | 2026 | vs. 2025 | 2026 | vs. 2025 | ||||||||||||||||||||||||||||||||||||
| Total U.S. | $ | 100.99 | 1.0 | % | 61.9 | % | 160 | bps | $ | 62.56 | 3.8 | % | |||||||||||||||||||||||||||||
Upscale & Above (1) | 159.98 | 1.4 | % | 62.7 | % | (20) | bps | 100.37 | 1.1 | % | |||||||||||||||||||||||||||||||
Midscale & Upper Midscale (2) | 105.47 | 0.8 | % | 61.7 | % | 160 | bps | 65.11 | 3.6 | % | |||||||||||||||||||||||||||||||
Extended Stay (3) | 69.56 | 4.2 | % | 72.3 | % | 130 | bps | 50.29 | 6.2 | % | |||||||||||||||||||||||||||||||
Economy (4) | 74.12 | 0.9 | % | 51.4 | % | 130 | bps | 38.13 | 3.5 | % | |||||||||||||||||||||||||||||||
International (5) | 117.57 | 3.9 | % | 71.3 | % | (10) | bps | 83.77 | 3.7 | % | |||||||||||||||||||||||||||||||
Total System (5) | $ | 105.21 | 1.8 | % | 64.1 | % | 130 | bps | $ | 67.41 | 3.9 | % | |||||||||||||||||||||||||||||
| For the Nine Months Ended September 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| ADR | Occupancy | RevPAR | |||||||||||||||||||||||||||||||||||||||
| 2026 | vs. 2025 | 2026 | vs. 2025 | 2026 | vs. 2025 | ||||||||||||||||||||||||||||||||||||
| Total U.S. | $ | 96.48 | 0.1 | % | 57.6 | % | 60 | bps | $ | 55.61 | 1.3 | % | |||||||||||||||||||||||||||||
Upscale & Above (1) | 152.95 | 1.6 | % | 57.7 | % | — | bps | 88.32 | 1.6 | % | |||||||||||||||||||||||||||||||
Midscale & Upper Midscale (2) | 100.73 | 0.1 | % | 57.1 | % | 70 | bps | 57.47 | 1.2 | % | |||||||||||||||||||||||||||||||
Extended Stay (3) | 68.47 | 2.7 | % | 70.0 | % | — | bps | 47.90 | 2.6 | % | |||||||||||||||||||||||||||||||
Economy (4) | 70.68 | (1.4) | % | 47.9 | % | (10) | bps | 33.84 | (1.6) | % | |||||||||||||||||||||||||||||||
International (5) | 109.28 | 2.8 | % | 64.8 | % | 20 | bps | 70.78 | 3.0 | % | |||||||||||||||||||||||||||||||
Total System (5) | $ | 99.71 | 0.9 | % | 59.3 | % | 60 | bps | $ | 59.11 | 2.0 | % | |||||||||||||||||||||||||||||
| For the Three Months Ended | For the Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||
| September 30, 2026 | September 30, 2025 | September 30, 2026 | September 30, 2025 | ||||||||||||||||||||||||||||||||||||||
| U.S. Average Royalty Rate | |||||||||||||||||||||||||||||||||||||||||
| Total U.S. | 5.23 | % | 5.15 | % | 5.22 | % | 5.12 | % | |||||||||||||||||||||||||||||||||
(1) Includes Ascend Hotel Collection, Cambria, Park Plaza, Radisson, Radisson Blu, Radisson Individuals, and Radisson RED brands. | |||||||||||||||||||||||||||||||||||||||||
(2) Includes Clarion, Comfort Inn, Comfort Suites, Country Inn & Suites, Park Inn, Quality Inn, and Sleep Inn brands. | |||||||||||||||||||||||||||||||||||||||||
(3) Includes Everhome Suites, MainStay Suites, Suburban Studios, and WoodSpring Suites brands. | |||||||||||||||||||||||||||||||||||||||||
(4) Includes Econo Lodge and Rodeway Inn brands. | |||||||||||||||||||||||||||||||||||||||||
(5) International and Total System results are presented on a currency-neutral basis and exclude the impact of foreign currency exchange movements. | |||||||||||||||||||||||||||||||||||||||||
| Exhibit 5 | |||||||||||
| CHOICE HOTELS INTERNATIONAL, INC. | |||||||||||
| SYSTEM HOTEL AND ROOM SUPPLY | |||||||||||
| (UNAUDITED) | |||||||||||
| Global System by Brand | September 30, 2026 | ||||||||||
| Hotels | Rooms | ||||||||||
| Ascend Hotel Collection | 539 | 72,180 | |||||||||
| Cambria Hotels | 79 | 10,546 | |||||||||
Radisson(1) | 130 | 22,716 | |||||||||
Comfort(2) | 2,135 | 178,772 | |||||||||
| Quality | 1,868 | 146,892 | |||||||||
| Country | 400 | 32,299 | |||||||||
| Sleep | 429 | 30,705 | |||||||||
Clarion(3) | 276 | 36,951 | |||||||||
| Park Inn | 35 | 2,881 | |||||||||
| WoodSpring | 300 | 36,115 | |||||||||
| MainStay | 157 | 11,485 | |||||||||
| Suburban | 121 | 9,992 | |||||||||
| Everhome | 32 | 3,679 | |||||||||
| Econo Lodge | 618 | 35,255 | |||||||||
| Rodeway Inn | 427 | 23,600 | |||||||||
Other (4) | 58 | 6,546 | |||||||||
(1) Includes Radisson, Radisson Blu, Radisson Individuals, Radisson RED and Park Plaza brands. | |||||||||||
(2) Includes Comfort family of brand extensions including Comfort Inn and Comfort Suites. | |||||||||||
(3) Includes Clarion family of brand extensions including Clarion and Clarion Pointe. | |||||||||||
(4) Includes other brands under Master Franchise Agreements. | |||||||||||
| U.S. System by Chain Scale | September 30, 2026 | ||||||||||
| Hotels | Rooms | ||||||||||
| Upscale & Above | 378 | 60,876 | |||||||||
| Midscale & Upper Midscale | 4,212 | 320,686 | |||||||||
| Extended Stay | 602 | 60,592 | |||||||||
| Economy | 989 | 56,061 | |||||||||
| Global System by Region | September 30, 2026 | ||||||||||
| Hotels | Rooms | ||||||||||
| U.S. | 6,181 | 498,215 | |||||||||
| Total International | 1,423 | 162,399 | |||||||||
| Americas (excluding U.S.) | 549 | 56,605 | |||||||||
| Europe & Middle East | 488 | 71,208 | |||||||||
| Asia-Pacific | 386 | 34,586 | |||||||||
| Total System | 7,604 | 660,614 | |||||||||
| Exhibit 6 | |||||||||||||||||||||||||||||
| CHOICE HOTELS INTERNATIONAL, INC. | |||||||||||||||||||||||||||||
| SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION | |||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||
| ADJUSTED SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | |||||||||||||||||||||||||||||
| (dollar amounts in thousands) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||
| Total selling, general and administrative expenses | $ | 81,275 | $ | 79,610 | $ | 255,474 | $ | 243,118 | |||||||||||||||||||||
| Mark to market adjustments on non-qualified retirement plan investments | (255) | (2,657) | (5,227) | (5,907) | |||||||||||||||||||||||||
| Non-recurring operational restructuring charges and executive severance | (5,047) | (497) | (7,585) | (4,799) | |||||||||||||||||||||||||
| Share-based compensation | (3,879) | (6,397) | (13,246) | (18,523) | |||||||||||||||||||||||||
| Amortization of cloud computing arrangements | (326) | (189) | (902) | (189) | |||||||||||||||||||||||||
| Global ERP system implementation and related costs | (86) | (1,587) | (445) | (3,653) | |||||||||||||||||||||||||
| Adjusted selling, general and administrative expenses | $ | 71,682 | $ | 68,283 | $ | 228,069 | $ | 210,047 | |||||||||||||||||||||
| ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION ("ADJUSTED EBITDA") | |||||||||||||||||||||||||||||
| (dollar amounts in thousands) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||
| Net income | $ | 57,912 | $ | 179,996 | $ | 142,554 | $ | 306,264 | |||||||||||||||||||||
| Income tax expense | 17,131 | 30,920 | 48,681 | 73,025 | |||||||||||||||||||||||||
| Interest expense | 25,575 | 23,490 | 73,796 | 67,468 | |||||||||||||||||||||||||
| Interest income | (998) | (1,435) | (3,304) | (4,450) | |||||||||||||||||||||||||
| Amortization of cloud computing arrangements | 326 | 189 | 902 | 189 | |||||||||||||||||||||||||
| Depreciation and amortization | 16,933 | 15,760 | 50,567 | 42,932 | |||||||||||||||||||||||||
| Impairment of long-lived assets | 6,035 | — | 6,035 | — | |||||||||||||||||||||||||
| Gain from an acquisition of a joint venture | — | (100,025) | — | (100,025) | |||||||||||||||||||||||||
| Gain on sale of assets | — | (713) | — | (713) | |||||||||||||||||||||||||
| Other gains, net | (7) | (721) | (5,410) | (5,659) | |||||||||||||||||||||||||
| Equity in net loss of affiliates | 6,866 | 10,904 | 14,334 | 11,035 | |||||||||||||||||||||||||
| Share-based compensation | 3,879 | 6,397 | 13,246 | 18,523 | |||||||||||||||||||||||||
| Mark to market adjustments on non-qualified retirement plan investments | 255 | 2,657 | 5,227 | 5,907 | |||||||||||||||||||||||||
| Franchise agreement acquisition costs amortization and charges | 6,129 | 4,257 | 18,618 | 15,584 | |||||||||||||||||||||||||
| Revenue for reimbursable costs from franchised and managed properties | (172,936) | (169,434) | (460,164) | (460,207) | |||||||||||||||||||||||||
| Reimbursable expenses from franchised and managed properties | 192,812 | 184,268 | 552,264 | 504,437 | |||||||||||||||||||||||||
| Global ERP system implementation and related costs | 86 | 1,587 | 445 | 3,653 | |||||||||||||||||||||||||
| Business combination, diligence and transition costs | 3,214 | 1,494 | 3,986 | 1,940 | |||||||||||||||||||||||||
| Non-recurring operational restructuring charges and executive severance | 5,047 | 497 | 7,585 | 4,799 | |||||||||||||||||||||||||
| Contract termination costs | 24,268 | — | 24,268 | — | |||||||||||||||||||||||||
| Adjusted EBITDA | $ | 192,527 | $ | 190,088 | $ | 493,630 | $ | 484,702 | |||||||||||||||||||||
| Exhibit 6 | |||||||||||||||||||||||||||||
| CHOICE HOTELS INTERNATIONAL, INC. | |||||||||||||||||||||||||||||
| SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION | |||||||||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||||||||
| ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE ("EPS") | |||||||||||||||||||||||||||||
| (dollar amounts in thousands, except per share amounts) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||
| Net income | $ | 57,912 | $ | 179,996 | $ | 142,554 | $ | 306,264 | |||||||||||||||||||||
| Impairment of long-lived assets | 6,035 | — | 6,035 | — | |||||||||||||||||||||||||
| Gain on sale of assets | — | (713) | — | (713) | |||||||||||||||||||||||||
| Gain from an acquisition of a joint venture | — | (100,025) | — | (100,025) | |||||||||||||||||||||||||
| Revenue for reimbursable costs from franchised and managed properties | (172,936) | (169,434) | (460,164) | (460,207) | |||||||||||||||||||||||||
| Reimbursable expenses from franchised and managed properties | 192,812 | 184,268 | 552,264 | 504,437 | |||||||||||||||||||||||||
| Business combination, diligence and transition costs | 3,214 | 1,494 | 3,986 | 1,940 | |||||||||||||||||||||||||
| Non-recurring operational restructuring charges and executive severance | 5,047 | 497 | 7,585 | 4,799 | |||||||||||||||||||||||||
| Global ERP system implementation and related costs | 86 | 1,587 | 445 | 3,653 | |||||||||||||||||||||||||
| Loss on sale of an affiliate | 3,805 | — | 3,805 | — | |||||||||||||||||||||||||
| Non-recurring joint venture formation transaction costs | — | 6,498 | — | 6,498 | |||||||||||||||||||||||||
| Contract termination costs | 24,268 | — | 24,268 | — | |||||||||||||||||||||||||
| Income tax expense on adjustments | (14,935) | (5,924) | (33,818) | (14,977) | |||||||||||||||||||||||||
| Adjusted Net Income | $ | 105,308 | $ | 98,244 | $ | 246,960 | $ | 251,669 | |||||||||||||||||||||
| Diluted EPS | $ | 1.28 | $ | 3.86 | $ | 3.12 | $ | 6.52 | |||||||||||||||||||||
| Adjusted Diluted EPS | $ | 2.33 | $ | 2.10 | $ | 5.41 | $ | 5.36 | |||||||||||||||||||||
| Exhibit 7 | |||||||||||||||||
| CHOICE HOTELS INTERNATIONAL, INC. | |||||||||||||||||
| OUTLOOK | |||||||||||||||||
| (UNAUDITED) | |||||||||||||||||
| Guidance represents the company's range of estimated outcomes for the full year ended December 31, 2026 | |||||||||||||||||
| ADJUSTED EBITDA | |||||||||||||||||
| (in thousands) | Full Year | Full Year | |||||||||||||||
| Lower Range | Upper Range | ||||||||||||||||
| Net income | $ | 178,000 | $ | 185,000 | |||||||||||||
| Income tax expense | 62,000 | 64,400 | |||||||||||||||
| Interest expense | 97,700 | 98,300 | |||||||||||||||
| Interest income | (4,100) | (4,100) | |||||||||||||||
| Amortization of cloud computing arrangements | 1,200 | 1,200 | |||||||||||||||
| Depreciation and amortization | 67,900 | 67,900 | |||||||||||||||
| Impairment of long-lived assets | 6,000 | 6,000 | |||||||||||||||
| Other gains, net | (5,400) | (5,400) | |||||||||||||||
| Equity in net loss of affiliates | 15,800 | 15,800 | |||||||||||||||
| Share-based compensation | 17,000 | 17,000 | |||||||||||||||
| Mark to market adjustments on non-qualified retirement plan investments | 5,200 | 5,200 | |||||||||||||||
| Franchise agreement acquisition costs amortization and charges | 26,300 | 26,300 | |||||||||||||||
| Revenue for reimbursable costs from franchised and managed properties | (599,200) | (599,200) | |||||||||||||||
| Reimbursable expenses from franchised and managed properties | 734,200 | 734,200 | |||||||||||||||
| Global ERP system implementation and related costs | 1,800 | 1,800 | |||||||||||||||
| Business combination, diligence and transition costs | 4,400 | 4,400 | |||||||||||||||
| Non-recurring operational restructuring charges and executive severance | 7,900 | 7,900 | |||||||||||||||
| Contract termination costs | 24,300 | 24,300 | |||||||||||||||
| Adjusted EBITDA | $ | 641,000 | $ | 651,000 | |||||||||||||
| ADJUSTED NET INCOME & DILUTED EARNINGS PER SHARE ("EPS") | |||||||||||||||||
| (in thousands, except per share amounts) | Full Year | Full Year | |||||||||||||||
| Lower Range | Upper Range | ||||||||||||||||
| Net income | $ | 178,000 | $ | 185,000 | |||||||||||||
| Impairment of long-lived assets | 6,000 | 6,000 | |||||||||||||||
| Revenue for reimbursable costs from franchised and managed properties | (599,200) | (599,200) | |||||||||||||||
| Reimbursable expenses from franchised and managed properties | 734,200 | 734,200 | |||||||||||||||
| Business combination, diligence and transition costs | 4,400 | 4,400 | |||||||||||||||
| Non-recurring operational restructuring charges and executive severance | 7,900 | 7,900 | |||||||||||||||
| Global ERP system implementation and related costs | 1,800 | 1,800 | |||||||||||||||
| Loss on sale of an affiliate | 3,800 | 3,800 | |||||||||||||||
| Contract termination costs | 24,300 | 24,300 | |||||||||||||||
| Income tax expense on adjustments | (46,200) | (46,200) | |||||||||||||||
| Adjusted net income | $ | 315,000 | $ | 322,000 | |||||||||||||
| Diluted EPS | $ | 3.92 | $ | 4.07 | |||||||||||||
| Adjusted Diluted EPS | $ | 6.92 | $ | 7.07 | |||||||||||||