Dive Brief:
- Choice Hotels International saw U.S. RevPAR decline 2.2% year over year, on an adjusted basis, in the fourth quarter of 2025, according to an earnings report published Thursday.
- The quarter represented the third-consecutive quarter of domestic RevPAR declines for Choice. In the report, the company attributed the Q4 results to softer government and international inbound demand.
- Meanwhile, Choice’s international RevPAR increased 3.2% year over year, on a currency-neutral basis, in the fourth quarter. The company has focused on portfolio growth in international markets in recent quarters amid a weakened U.S. performance environment.
Dive Insight:
Choice Hotels CEO Patrick Pacious said during a Thursday earnings call that in 2025, Choice “delivered 37% growth in international revenue driven by portfolio expansion and positive RevPAR growth across every region.”
“We view specific international markets as an increasingly important driver of our growth,” he said, noting that “Canada remains a key focus.”
On the development front, Choice saw 14% year-over-year growth in global hotel openings for full-year 2025, including a 42% increase in the fourth quarter alone, per the report. In 2025, Choice’s international net rooms grew 12.5% year over year.
Choice executed franchise agreements for more than 700 rooms in Canada in the fourth quarter, following the company’s July acquisition of Choice Hotels Canada. The deal drove 49% year-over-year growth in Choice’s Canada rooms pipeline in 2025, per the report.
“We see a meaningful opportunity to drive both system growth and stronger franchise economics,” Pacious said on the call, speaking about activity in Canada.
In the U.S., Choice opened 66 domestic extended stay hotels in 2025, surpassing the prior year’s growth, according to a separate release. Extended stay hotels represent more than 40% of Choice’s domestic pipeline, Pacious shared.
Conversion activity, meanwhile, is expected to “be a core driver of improving U.S. net room growth in 2026,” Pacious said. Choice competitor Hilton similarly noted during Q4 earnings that conversions remain “integral” to the company’s growth.
Choice anticipates roughly 1% global net rooms growth in 2026, per the report. The company also forecasts that both global and domestic RevPAR for 2026 will fall in a range between down 2% to up 1%.
In the U.S., tax relief is expected to reach middle-income households this year, acting as a stimulus for travel, Pacious said. Upcoming national events, including the 2026 FIFA World Cup, as well as “steady workforce-based travel demand tied to infrastructure, manufacturing and data center investment” could also improve domestic results, according to Pacious.
