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- **Record Q3 EBITDA**: $190M (+7% YoY), fueled by international expansion (35% intl EBITDA growth) and higher-revenue segments.
- **SMB & Business Travel Surge**: SMB revenue +18% YoY, business travelers 40% of stays, targeting $13B SMB travel TAM.
- **AI-Driven Efficiency**: $60M tech investment nearing completion, reducing SG&A growth to low single digits.
- **Retiree Growth**: 30% of revenue from retirees, with 4M annual retirements boosting leisure travel.
- **2026 Outlook**: Intl EBITDA to double 2024 baseline, U.S. RevPAR recovery supported by economy transient occupancy gains.

**【CEO Summary Section】**
- **Adjusted EBITDA Growth**: Q3 2025 adjusted EBITDA rose 7% YoY to $190 million, driven by higher revenue segments, SMB and group revenue growth, and international expansion.
- **International Momentum**: International EBITDA grew 35% YoY, with 98% of global pipeline in higher-revenue brands. China's Ascend Collection added nearly 8,000 rooms, and Everhome Suites expanded into Australia.
- **Strategic Investments**: $60M technology investment program nearing completion, focusing on AI-driven tools for franchisees. Loyalty program enhancements targeting retirees and business travelers.
- **Demographic Tailwinds**: 30% of revenue from retirees, with 4 million Americans retiring annually. Business travelers (40% of stays) and SMBs (18% YoY growth) provide resilience.
- **Pipeline Quality**: 90% of global portfolio in higher-revenue rooms, with 80% of U.S. openings via conversions (3-6 months vs. new construction).

**【CFO Financial Commentary】**
- **Q3 Financials**: GAAP EPS $2.10, adjusted EPS $2.27 (excluding one-time items). Full-year adjusted EBITDA guidance raised to $620-632M, up $1M midpoint.
- **Revenue Drivers**: Global rooms growth 2.3% YoY, led by extended-stay (+12%), mid-scale (+5%), and upscale (+7%). U.S. extended-stay RevPAR outperformed industry by 20bps.
- **Cost Efficiency**: SG&A expected to grow low single digits (2.5% YoY through Q3). AI tools reducing manual processes, e.g., 30%+ productivity gains in software development.
- **Capital Allocation**: $150M returned to shareholders YTD (dividends + buybacks). 2025 net capital outlays down $53M YoY, with Everhome development wrapping in 2026.
- **Tax Impact**: Q3 effective tax rate 21%, full-year 25%. Amortization from Canada JV adds $0.15-0.20 to 2025 EPS.

**【Q&A Highlights】**
- **Everhome JV Strategy**: 80% owned, with plans to sell to third parties via long-term franchise agreements. 2025 recycling proceeds $25M, total outlays down $53M YoY.
- **U.S. RevPAR Outlook**: 2025 U.S. RevPAR -3% to -2%, but 2026 optimism from economy transient occupancy gains and SMB demand ($13B TAM).
- **AI & Franchisee Tools**: Cloud-based AI systems for rate optimization, operations automation. 2026 launch of SMB digital platform targeting midweek occupancy.
- **International Growth**: 2027 intl EBITDA target $50M+ (vs. 2024 baseline). France pipeline doubled, China's Ascend Collection 80% onboarded, and Kenya's Radisson RED flagship opening.
- **Key Money Trends**: Avg. key money per deal down 11% YoY, reflecting brand strength in mid-scale segments.
- **Free Cash Flow**: 2025 conversion rate ~60-65%, driven by disciplined capex and recycling.

Choice Hotels International, Inc. (CHH) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

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Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

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Income (Loss) from Associates

Income (Loss) from Joint ventures

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Gain (Loss) on Change in Fair Value

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Other Non-Operating Income (Loss)

Net Interest Expense

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Net Income from Continuing Operations

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Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

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Other Comprehensive Income

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Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

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Diluted EPS from Discontinued Operations

CHH

CHH fundamentals

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