During Choice Hotels International’s fourth-quarter and full-year 2024 earnings call with investors, President and CEO Patrick Pacious highlighted the company’s successes during the previous three and twelve months. “We exceeded the top end of our guidance with a 12 percent year-over-year increase in adjusted [earnings before interest, taxes, depreciation and amortization],” he said, noting that this was a record for the company. EBITDA for the year was $604.1 million, and net income increased 16 percent to $299.7 million for full-year 2024, exceeding the top end of the company's full-year 2024 guidance.
The company also increased its domestic revenue per available room 4.5 percent for the three-month period ended Dec. 31 compared to the same period of 2023.
Pacious emphasized that the company’s scale is “enabling the positive results” from its investments. “With 22 hotel brands, our scale is significantly larger than it was just three years ago, and the benefits of that scale now extend to all of our hotels.” The company also has “a significant amount of investments” slated for 2025 “designed to help our franchisees manage their rate inventory and the rate structure.”
System Size
Choice’s net global rooms system size increased 3.3 percent, including 4.3 percent growth for the domestic upscale, extended-stay and midscale rooms portfolio compared to Dec. 31, 2023.
In Q4, Choice entered into a partnership with resort operator Westgate Resorts (announced in early 2025), which added 21 hotels and 14,471 rooms to the domestic portfolio and more than 180,000 upscale, upper-upscale and luxury rooms worldwide. This partnership was part of an overall expansion up the chain scale as the company added more than 110,000 upscale-and-above rooms to its portfolio over the year. These hotels now represent 17 percent of Choice’s overall system, Pacious said—“almost two times our economy portfolio.” The global upscale net rooms portfolio grew 43.9 percent from year-end 2023, and its pipeline reached nearly 25,000 rooms.
The company opened 407 hotels globally, a 21 percent increase for full-year 2024 compared to 2023. A full 98 percent of the rooms in its global pipeline are now within the more revenue-intense brands. “This means that our pipeline is set to generate significantly higher revenue compared to our existing portfolio, driven by a substantial [revenue per available room] premium, a higher average effective royalty rate and a larger room count per hotel,” Pacious said.
Choice opened 305 new domestic hotels in 2024, CFO Scott Oaksmith said—“our highest number since before the pandemic. We are particularly pleased to see our new hotel construction starts in the fourth quarter exceed our expectations, and we saw an 8 percent year-over-year increase in the number of new-construction hotels open.”
Choice’s domestic net rooms portfolio grew 3 percent from year-end 2023. Domestic net unit growth accelerated from Sept. 30 and domestic upscale, extended stay and midscale units grew 1.5 percent from year-end 2023.
The company’s domestic extended-stay net rooms portfolio grew 9.8 percent from year-end 2023, and its pipeline reached nearly 43,000 rooms. The international net rooms portfolio grew 4.4 percent from year-end 2023, highlighted by a 58 percent increase in international hotel openings in the quarter.
Choice’s global pipeline as of Dec. 31 was more than 97,000 rooms, of which nearly 83,000 rooms were domestic.
Outlook
Choice’s full-year 2025 net income is expected to range between $288 to $300 million; full-year 2025 adjusted EBITDA is expected to range between $625 and $640 million. “We anticipate this growth to be driven by organic growth across our revenue-intense hotels and markets; robust, effective royalty-rate growth; continued growth from our ancillary revenue streams; [and] strong international business and incremental revenue-generating opportunities from our expanded scale,” Oaksmith said during the call.
