Choice Hotels International raised its full-year net rooms growth guidance to 1.5% and pointed toward a return to long-term organic growth of 2% to 4%, citing lower franchise construction costs, stronger unit retention and continued brand momentum across its portfolio.
The updates came during a presentation at the Bank of America Gaming and Lodging Conference on Wednesday, Sept. 9, 2026. Dom Dragisich, who was preparing to assume the role of president and chief executive officer within weeks after nearly seven years as CFO, outlined a strategy centered on accelerating development, recycling assets and returning capital to shareholders.
Choice reported trailing twelve-month EBITDA of $474 million and a market capitalization of $4.43 billion. Adjusted EBITDA rose from $295 million in 2017 to approximately $643 million based on second-quarter guidance, reflecting a roughly 118% increase over nine years. Gross profit margin stood at 90.33%.
The company announced $200 million in share repurchase guidance, the first buyback program it has issued in a decade. Combined with organic growth initiatives, Choice targeted $450 million to $650 million in shareholder returns annually. Leverage sat at 3.1 times at the end of the second quarter, within its 3-to-4-times target range. About $650 million in assets or capital remains available for recycling over time, with the first wave of asset sales expected in the first half of 2027.
Development activity accelerated sharply in the second quarter. Openings and development franchise agreements each rose roughly 30% year over year, while terminations and exits declined about 50%. Choice expects retention to improve by 250 basis points for the full year, returning to historically normalized levels. Approximately 90% of openings this year are projected to be conversions rather than new builds.
Franchisee cost pressures eased materially. Prototype costs have been reduced by about 25%, furniture, fixtures and equipment expenses trimmed by roughly 20%, and the interval between signing and opening shortened by about a month. Dragisich noted that all-in franchise fees sit at approximately 10% industry-wide, inclusive of royalty and system fund charges, with an effective royalty rate guided at 7 to 9 basis points for the year.
RevPAR trends also improved. July comparable RevPAR was expected to finish about 100 basis points above June, and third-quarter RevPAR is projected to exceed the second quarter. Supply growth is anticipated to remain below 1% for the foreseeable future.
Brand-level dynamics varied. The Comfort brand cleanup initiative has been completed, and the brand has returned to standard termination rates. Cambria currently operates 75 units, while Everhome — with 30 open properties — was highlighted as one of the fastest-growing mid-scale extended-stay brands. International revenue contributed approximately $50 million.
On the technology front, Choice emphasized that its central reservation system and property management system are homegrown and cloud-native, built on Amazon Web Services. The company introduced CHARLIE, an AI teammate embedded within its property management platform, which reduced operational requests by about 40% and cut shift-worker time for certain tasks by roughly 50%. An automated request-for-proposal response tool lifted conversion rates by 360 basis points.
