Choice Hotels International has posted a robust second-quarter performance for 2026, with global net rooms expanding 26% year-over-year and US RevPAR climbing 13%. The growth was led by the company's extended stay, midscale, and upscale brands, which together saw a 36% increase in net rooms.
The Rockville, Maryland-based franchisor opened approximately 6,400 rooms in the US during the quarter, its strongest second-quarter total since 2019. US franchise agreements awarded jumped 30%, representing about 9,400 new rooms in the development pipeline.
Financial highlights and margin pressure
Net income for the quarter ended 30 June came in at $64 million, down 21% from the prior-year period, reflecting higher net reimbursable deficits and increased depreciation. However, adjusted EBITDA rose 6% to $175 million, and adjusted diluted earnings per share increased 5% to $2.02.
Dom Dragisich, interim CEO, said: "Our second quarter results reflect encouraging progress across our key priorities with US net rooms growth improving for the second consecutive quarter." The company has been focusing on its extended-stay and upscale segments, which are seen as high-growth areas in the lodging industry.
Internationally, RevPAR grew 21% on a currency-neutral basis, with particularly strong performance in the Caribbean, Latin America, Canada, and Asia Pacific. The global pipeline now stands at approximately 77,300 rooms, with a strong concentration in the same brand tiers.
Outlook and strategic focus
Choice Hotels has updated its full-year 2026 guidance, adjusting net income and EPS expectations due to increased marketing and reservation system expenses. The company remains confident in its commercial engine and technology platform to drive franchisee economics and guest experiences.
The results come amid a broader trend of hotel franchisors expanding aggressively, though some markets face oversupply concerns. For context, Chinese hotel stocks have slid as franchise expansion outpaces demand growth, a cautionary note for the industry. Meanwhile, other major players like Accor posted 6.5% EBITDA growth in H1 2026 despite regional headwinds.
Choice's focus on extended stay aligns with shifting traveler preferences for longer-duration stays and residential-style accommodations. The company's upscale brands, including Cambria Hotels and Ascend Hotel Collection, are also gaining traction with developers seeking higher revenue per key.
"We are leveraging our commercial engine and technology to enhance franchisee economics," Dragisich added. The company's digital booking platform and loyalty program, Choice Privileges, continue to be key differentiators in a competitive franchising landscape.
With the global pipeline at 77,300 rooms, Choice Hotels is well-positioned for continued expansion. The company's international growth, particularly in the Caribbean and Asia Pacific, mirrors broader tourism trends, as highlighted by governments increasingly adopting tourism as core economic policy.
For travel professionals, Choice's performance underscores the resilience of the midscale and extended-stay segments, even as economic uncertainties persist. The company's ability to grow net rooms while maintaining adjusted EBITDA growth suggests a healthy balance between expansion and profitability.
