CHH

MKT CAP $4.9BP/E 15.3DIV YIELD 1.06%FCF YIELD 3.14%REV TTM $1.6B +2.6%NET INCOME $328.3M +6.7%NET DEBT $2B52W 84.40 – 122.08SEC XBRL · TTM TO Invalid Date

How CHH rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

Text kept

65%

of sentences unchanged

Added

164

new sentences

Dropped

156

sentences removed

Length

−25

words, now 22,937

New in FY2025

Risk Factors of this Annual Report on Form 10-K.
Business Overview We are primarily a hotel franchisor operating in 49 states, the District of Columbia, and 50 countries and territories.
As of December 31, 2025, we had 7,575 hotels with 656,825 rooms open and operating, and 825 hotels with 77,862 rooms under construction, awaiting conversion or approved for development, or committed to future franchise development on outstanding master development agreements (collectively, "pipeline") in our global system.
Our brand names include Clarion®, Clarion Pointe™, Comfort Inn®, Comfort Suites®, Country Inn & Suites® by Radisson, Sleep Inn®, Quality®, Park Inn by Radisson®, Everhome Suites®, WoodSpring Suites®, MainStay Suites®, Suburban Studios™, Radisson Blu®, Park Plaza®, Cambria® Hotels, Ascend Collection®, Radisson RED®, Radisson Individuals®, Radisson®, Radisson Collection®, Radisson Inn & Suites SM , Econo Lodge®, and Rodeway Inn®.
The Company's U.S. operations are primarily conducted through direct franchising relationships, the ownership of 10 Cambria, four Everhome Suites, one Radisson RED, one Radisson Blu, and one Country Inn & Suites open and operating hotels, and the management of 13 hotels (inclusive of four owned hotels), while its international franchise operations are conducted through a combination of direct franchising and master franchising relationships.
As a result of our master franchise relationships and international market conditions, our revenues are primarily concentrated in the U.S.
Therefore, our description of our business is primarily focused on the U.S. operations.
The fee and cost structure of our franchising business provides opportunities to improve our operating results by increasing the number of franchised hotel rooms and the royalty rates in our franchise contracts.
In addition, our operating results can also be improved through our company-wide efforts related to improving property-level performance and expanding the number of partnerships with travel-related and other companies with products and services that appeal to our franchisees and guests.
The primary factors that affect the Company’s results are: the number and relative mix of hotel rooms in the various hotel lodging price categories, growth in the number of hotel rooms owned and under franchise, occupancy and room rates achieved by the hotels in our system, the average royalty rates achieved in our franchise agreements, the level of franchise sales and relicensing activity, the number of qualified vendor arrangements and partnerships and the level of engagement with these partners by our franchisees and guests, and our ability to manage costs.
We are required by our franchise agreements to use the marketing and reservation fees we collect for system-wide marketing and reservation activities.
Our Company focuses on the following strategic priorities: Profitable Growth - Our success is dependent on improving the performance of our hotels, increasing the size of our system by selling additional hotel franchises with a focus on revenue-intense chain scales and markets, improving our royalty rates, expanding our qualified vendor and partnership programs and maintaining a disciplined cost structure.
In addition to our hotel franchising business, we have also developed or acquired 10 Cambria, four Everhome Suites, one Radisson RED, one Radisson Blu, and one Country Inn & Suites open and operating hotels.
Owning hotels allows us to increase the presence of our newly introduced brands in the U.S., drive greater guest satisfaction and brand preference, and ultimately increase the number of franchise agreements awarded.
Our direct real estate exposure is currently limited to activity in the U.S., including our owned hotel assets open and under development.
Under a typical franchise agreement, the hotel owner pays the franchisor an initial fee, a percentage-of-revenue royalty fee, and a marketing & reservation fee.
Earnings drivers include RevPAR increases, unit growth, and royalty rate improvement.
As a franchisor with 7,575 opened hotels, including ownership of 17 hotels and management of 13 hotels (inclusive of four owned hotels), we believe we are generally well positioned in any stage of the lodging cycle as our fee-for-service business model has historically delivered predictable and profitable, long-term growth in a variety of lodging and economic environments.
Economics of the Franchising Business - The fee and cost structure of our business provides opportunities for us to improve operating results by increasing the number of franchised hotel rooms, improving RevPAR performance, and increasing the royalty rates in our franchise contracts.
As a hotel franchisor, we derive our revenue primarily from various franchise fees, which consist primarily of an initial fee and ongoing royalty, marketing, and reservation fees that are typically based on a percentage of the franchised hotel’s gross room revenues.
The marketing and reservation fees are used for the expenses associated with marketing, media, advertising, providing a central reservation system, and certain franchise services.
Our fees depend on the number of rooms in our system, the gross room revenues generated by our franchisees, and the royalty rates in our franchise contracts.
In addition, improving business delivery to our franchisees should allow us to improve the royalty rates in our franchise contracts.
Certain of our brands, such as Quality, Clarion Pointe, Ascend Collection, Econo Lodge, and Radisson, offer conversion opportunities during both industry contraction and growth cycles to independent operators and non-Choice affiliated hotels who desire to affiliate with our brands and take advantage of the services we have to offer.
Improving the desirability of our brands should also allow us to continue to improve the royalty rates in our franchise contracts.
The Company intends to continue to increase awareness of its brands through its national marketing campaigns and continual enhancements to its loyalty program, including promotions.
Our central reservations system is a critical technology used to deliver guests to our franchisees through multiple channels, including our call centers, proprietary web and mobile sites, global distribution systems (e.g., SABRE, Amadeus), online travel agents ("OTAs") (e.g., Expedia, Booking.com), and internet referral or booking services (e.g., Kayak, Tripadvisor).
We are focused on expanding our business through key partnerships, new technology, and other key franchisee resources, which is reflected in our partnership services and fees revenues.
We believe our efforts to leverage the Company’s size, scale, and distribution benefit the Company by enhancing brand quality and consistency, improving our franchisees returns and satisfaction, and generating partnership services and fees revenues.
Our brands consist of the following: Clarion - Clarion helps owners of existing assets with food and beverage capabilities achieve strong returns with reasonable investment.
Clarion helps business and leisure guests "Get Together Here™" by providing meeting/banquet facilities, restaurants, and lounges.
Clarion Pointe - Clarion Pointe is ideal for owners who want to strategically reposition their limited-service property into a brand with strong awareness and a concept that satisfies the expectations of emerging travelers.
Comfort - The Comfort brand family is the flagship brand in the Choice Hotels portfolio and is inclusive of Comfort Inn, Comfort Suites, and Comfort Inn & Suites.
Comfort is an upper midscale brand that allows guests to unlock the joy of traveling while enabling owners to capitalize on a trusted brand with proven performance and market leadership.
The properties offer guest rooms and public spaces that can transform from day to night or business to leisure – blending form and function to optimize the guest experience and the owner’s investment.
The principal competitor brands include Hampton by Hilton, Holiday Inn Express, and Fairfield by Marriott.
Country Inn & Suites by Radisson - Country Inn & Suites delivers “generous hospitality with touches of home”, creating heartfelt experiences for travelers through inviting design, thoughtful touches, and genuine service.
Guests enjoy a mix of spacious standard rooms and suites, cozy seating by the living room fireplace, and complementary offerings including a hot breakfast, all-day coffee and tea, freshly baked cookies upon arrival, free Wi-Fi, and printer access.
Country Inn & Suites properties are equipped with fitness and laundry facilities, outdoor patios with fire pit features, casual workspaces, swimming pools, and meeting spaces.
Guests feel cared for and valued at Country Inn & Suites, enabling them to maintain their routines while away from home.

and 124 more.

Gone since FY2024

Business Overview We are primarily a hotel franchisor operating in 49 states, the District of Columbia, and 46 countries and territories.
As of December 31, 2024, we had 7,586 hotels with 653,810 rooms open and operating, and 964 hotels with 97,325 rooms under construction, awaiting conversion or approved for development, or committed to future franchise development on outstanding master development agreements (collectively, "pipeline") in our global system.
Our brand names include Comfort Inn®, Comfort Suites®, Quality®, Clarion®, Clarion Pointe™, Ascend Hotel Collection®, Sleep Inn®, Econo Lodge®, Rodeway Inn®, MainStay Suites®, Suburban Studios™, WoodSpring Suites®, Everhome Suites®, and Cambria® Hotels (collectively, the "legacy Choice brands").
Additionally, through the Radisson Hotels Americas acquisition completed on August 11, 2022, our brands expanded to include Radisson Blu®, Radisson RED®, Radisson®, Park Plaza®, Country Inn & Suites® by Radisson, Radisson Inn & Suites SM , Park Inn by Radisson®, Radisson Individuals®, and Radisson Collection® (collectively, the "legacy Radisson brands"), which are located across the United States, Canada, the Caribbean and Latin America (the "Americas").
The Company's domestic operations are conducted through direct franchising relationships, the ownership of eight Cambria, one Everhome Suites, one Radisson RED, one Radisson Blu, and one Country Inn & Suites open and operating hotels, and the management of 13 hotels (inclusive of four owned hotels), while its international franchise operations are conducted through a combination of direct franchising and master franchising relationships.
As a result of our master franchise relationships and international market conditions, our revenues are primarily concentrated in the United States.
Therefore, our description of our business is primarily focused on the domestic operations, which encompasses the United States.
The fee and cost structure of our franchising business provides opportunities to improve our operating results by increasing the number of franchised hotel rooms and the effective royalty rates in our franchise contracts resulting in increased initial franchise fees, ongoing royalty and licensing fees, and platform and procurement services fees.
In addition, our operating results can also be improved through our company-wide efforts related to improving property-level performance and expanding the number of partnerships with travel-related and other companies with products and services that appeal to our guests.
The primary factors that affect the Company’s results are: the number and relative mix of hotel rooms in the various hotel lodging price categories, growth in the number of hotel rooms owned and under franchise, occupancy and room rates achieved by the hotels in our system, the effective royalty rate achieved in our franchise agreements, the level of franchise sales and relicensing activity, the number of qualified vendor arrangements and partnerships and the level of engagement with these partners by our franchisees and guests, and our ability to manage costs.
We are required by our franchise agreements to use the marketing and reservation system fees we collect for system-wide marketing and reservation system activities.
Our Company focuses on the following strategic priorities: Profitable Growth - Our success is dependent on improving the performance of our hotels, increasing the size of our system by selling additional hotel franchises with a focus on revenue-intense chain scales and markets, improving our effective royalty rate, expanding our qualified vendor and partnership platform programs and maintaining a disciplined cost structure.
In addition to our hotel franchising business, we have also developed or acquired eight Cambria, one Everhome Suites, one Radisson RED, one Radisson Blu, and one Country Inn & Suites open and operating hotels.
We intend to continue to strategically develop hotels to increase the presence of our newly introduced brands in the United States, drive greater guest satisfaction and brand preference, and ultimately increase the number of franchise agreements awarded.
Our direct real estate exposure is currently limited to activity in the United States, including our owned hotel assets open and under development.
Under a typical franchise agreement, the hotel owner pays the franchisor an initial fee, a percentage-of-revenue royalty fee, and a marketing & reservation systems fee.
Earnings drivers include RevPAR increases, unit growth, and effective royalty rate improvement.
As a franchisor with 7,586 opened hotels, including ownership of 12 hotels and management of 13 hotels (inclusive of four owned hotels), we believe we are generally well positioned in any stage of the lodging cycle as our fee-for-service business model has historically delivered predictable and profitable, long-term growth in a variety of lodging and economic environments.
Economics of the Franchising Business - The fee and cost structure of our business provides opportunities for us to improve operating results by increasing the number of franchised hotel rooms, improving RevPAR performance, and increasing the effective royalty rates in our franchise contracts.
As a hotel franchisor, we derive our revenue primarily from various franchise fees, which consist primarily of an initial fee and ongoing royalty, marketing and reservation system fees that are typically based on a percentage of the franchised hotel’s gross room revenues.
The marketing and reservation system fees are used for the expenses associated with marketing, media, advertising, providing a central reservation system, and certain franchise services.
Our fees depend on the number of rooms in our system, the gross room revenues generated by our franchisees, and the effective royalty rates in our franchise contracts.
In addition, improving business delivery to our franchisees should allow us to improve the effective royalty rate in our franchise contracts.
Certain of our brands, such as Quality, Clarion Pointe, Ascend Hotel Collection, Econo Lodge, and Radisson, offer conversion opportunities during both industry contraction and growth cycles to independent operators and non-Choice affiliated hotels who desire to affiliate with our brands and take advantage of the services we have to offer.
Improving the desirability of our brands should also allow us to continue to improve the effective royalty rate in our contracts.
The Company intends to continue to increase awareness of its brands through its national marketing campaigns and its loyalty program promotions.
Our central reservations system is a critical technology used to deliver guests to our franchisees through multiple channels, including our call centers, proprietary web and mobile sites, global distribution systems (e.g., SABRE, Amadeus), online travel agents ("OTAs") (e.g., Expedia, Booking.com) and internet referral or booking services (e.g., Kayak, Trip Advisor).
We are focused on expanding our platform business through key partnerships, new technology, and other key franchisee resources, which is reflected in our procurement services revenues.
We believe our efforts to leverage the Company’s size, scale and distribution benefit the Company by enhancing brand quality and consistency, improving our franchisees returns and satisfaction, and generating procurement services revenues.
Our brands are as follows: Cambria Hotels - Cambria Hotels is a select service hotel brand that operates in the upscale chain scale category, targeting the top primary market locations and secondary markets with a mix of business and leisure demand.
The environment matches guests' casual lifestyles but tailored to the needs of the modern traveler.
The properties feature a compelling design inspired by the location, spacious and comfortable rooms, spa inspired bathrooms, outdoor spaces featuring pools and rooftop bars, flexible meeting space, and a locally sourced menu and craft beer.
Ascend Hotel Collection - The Ascend Hotel Collection is an innovative global soft brand collection offering resort, boutique and historic properties that reflect, and are woven into, the fabric of their destination.
Ascend enables upscale hotels to retain their individual brand equity and identity, and yet have access to Choice Hotels' global distribution, technology, performance support services, training, and loyalty benefits.
The Ascend Hotel Collection offers the best of both worlds, including an independence backed by a powerful platform for customer acquisition, delivery and distribution, volume purchasing benefits, and operational efficiencies.
The properties can be found in suburban, small towns, and resorts.
The principal competitor brands include BW Signature Collection, BW Premier Collection, Trademark, and Voco.
Radisson - Radisson is a full service hotel brand that provides an upscale travel experience.
Innovating to meet the evolving needs of guests, Radisson hotels offer functional guestrooms, upscale on-site services such as modern fitness facilities, restaurants and bars, and free Wi-Fi, which is designed for travelers seeking simplicity, authenticity, and modern imperatives during each hotel stay.
Hotel spaces kick-start the fun with vibrant designs, encourage social sharing, and easily switch from work to play and back.

and 116 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

Watch CHH. Know when insiders buy.

One email the day a filing lands. Free.