In This Article:
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Adjusted EBITDA: Increased 4% year-over-year to $129.6 million.
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Adjusted Earnings Per Share: Increased 5% year-over-year to $1.34.
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Global Rooms Growth: Increased 3.9% year-over-year.
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Domestic RevPAR: Increased 2.3% year-over-year.
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Extended-Stay Portfolio Growth: Increased 19% over past years to approximately 53,000 rooms.
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Extended-Stay RevPAR Growth: Increased 6.8% year-over-year.
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Effective Royalty Rate: Increased 8 basis points year-over-year.
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Partnership Services and Fees Revenue: Increased 28% year-over-year.
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Adjusted Free Cash Flow: Increased 30% year-over-year to $36 million.
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Shareholder Returns: $115 million returned, including $27 million in dividends and $88 million in share repurchases.
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Total Available Liquidity: $594 million as of March 31, 2025.
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Full Year 2025 Adjusted EBITDA Guidance: $615 million to $635 million.
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Full Year 2025 Adjusted EPS Guidance: $6.90 to $7.22.
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Choice Hotels International Inc (NYSE:CHH) reported a 4% year-over-year increase in adjusted EBITDA and a 5% increase in adjusted earnings per share for the first quarter of 2025.
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The company achieved a 3% year-over-year net increase in global rooms, with a 4% net increase in more revenue-intense rooms.
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Business travel segment grew 10% year-over-year, driven by both group and business transient travel.
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The company's extended-stay portfolio increased by 19% over the past years, representing half of the total domestic rooms pipeline.
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Choice Hotels International Inc (NYSE:CHH) expanded its rewards program to over 70 million members, an 8% year-over-year increase, enhancing customer loyalty and direct bookings.
Negative Points
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The company adjusted its full-year 2025 outlook due to a more uncertain macroeconomic backdrop, impacting the lodging industry.
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Domestic RevPAR expectations were revised to a range of negative 1% to positive 1%, reflecting recent trends and macroeconomic uncertainty.
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The pipeline of rooms has ticked down each quarter for the last four quarters, raising concerns about future unit growth.
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April RevPAR performance was down approximately 1% year-over-year when normalizing for the Easter shift and eclipse-related travel impacts.
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The upscale segment showed a decline due to a few properties leaving and newer properties ramping, affecting RevPAR results.
Q & A Highlights
Q: How is Choice Hotels positioned in the current macroeconomic environment, especially with the observed softness in leisure and lower-end chain scales? A: Patrick Pacious, CEO, highlighted that Choice Hotels is well-positioned due to its diversified consumer base, which includes higher-income consumers and a balanced mix of business and leisure travelers. The company is gaining market share, particularly in the economy and extended-stay segments, and is optimistic about its brand positioning and consumer resilience.