Choice Hotels raises 2026 RevPAR outlook as US net rooms growth improves

Choice Hotels International raised its full-year 2026 US and global RevPAR outlooks to growth of 1.5% to 2.5%, up from a prior range starting at 0%, after US RevPAR rose 3.8% in the third quarter on higher occupancy and rate, the franchisor said on 2 November.

Net income fell 68% to $58 million, mainly because the prior-year quarter included a $100 million gain from a joint venture acquisition. This year's quarter carried a $24 million charge for ending an arrangement that included an option to acquire a European hospitality business operating mainly under leases, plus a $6 million impairment on two owned hotels. Adjusted EBITDA rose 1% to $193 million, and franchise and management fees grew 5% to $204 million.

US rooms were roughly flat year on year as room exits dropped 23%, while global net rooms grew 1.7% and international rooms 7.3%, led by EMEA, Asia-Pacific and Canada. US franchise agreements awarded climbed 24%, representing 6,900 rooms, and the US conversion pipeline reached 25,500 rooms, up 29% on a year earlier. The US average royalty rate rose 8 basis points to 5.23%.

Choice is also selling owned assets. After quarter-end it sold two hotels for estimated net proceeds of about $34 million, keeping franchise agreements on both, and now owns 17 operating hotels. On 1 October it bought RV travel subscription platform Harvest Hosts for about $130 million.

"Our focus is on returning to the fundamentals that have driven our success for decades," said chief executive Dom Dragisich, adding that the company expects US net rooms growth of about 1% by year-end. Net income guidance was cut to $178 million to $185 million, partly due to higher spending on franchisee-facing tools.