Financial Data and Key Metrics Changes - Adjusted EBITDA increased by 7% year-over-year to $190 million, driven by a stronger revenue brand mix and growth in small and medium business traveler revenue [4][24] - Global rooms grew by 2.3% year-over-year, with higher revenue segments expanding by 3.3% [25][28] - Adjusted earnings per share (EPS) for Q3 2025 was $2.10, down from $2.23 in the prior year, primarily due to increased amortization expenses and temporary tax impacts [31][35] Business Line Data and Key Metrics Changes - The U.S. extended stay segment saw a 12% year-over-year growth in room system size, with openings increasing by 14% [25][28] - The international business achieved a 35% growth in adjusted EBITDA, with an 8% year-over-year increase in the international portfolio [9][24] - The economy transient segment outperformed its chain-scale RevPAR by 310 basis points year-to-date [28] Market Data and Key Metrics Changes - International RevPAR increased by 9.5% year-over-year, with EMEA leading at 11% growth [28] - U.S. RevPAR declined by 3.2% year-over-year, attributed to softer government and international inbound demand [28] - Canadian operations reported a 7% increase in RevPAR for Q3 [28] Company Strategy and Development Direction - The company is focusing on expanding its higher revenue-generating segments, with 98% of its global pipeline in these brands [5][24] - A strategic shift towards a higher value direct franchising model has been implemented, with international EBITDA margins expanding to 70% [8][9] - Investments in technology and AI are aimed at enhancing franchisee success and operational efficiency [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the U.S. lodging cycle, citing favorable demographic trends and upcoming events like the 2026 World Cup as demand catalysts [6][7] - The company anticipates sustained RevPAR growth driven by strategic investments and an expanding business travel base [29][36] - The retiree demographic is expected to significantly contribute to future demand, with a projected increase in travel spending [22][49] Other Important Information - The company returned $150 million to shareholders through dividends and share repurchases year-to-date [33] - The full-year adjusted EBITDA guidance has been tightened to a range of $620 million to $632 million [35] - The company is on track to complete its technology investment program, enhancing its operational capabilities [17][23] Q&A Session Summary Question: Clarification on the EverHome joint venture and asset recycling - Management explained that the joint venture allows for longer-term hotel ownership while still focusing on asset recycling, with a net benefit of $25 million from the transaction [37][39] Question: Rationale for not buying back stock during the quarter - The decision was based on prioritizing investments in the business and the acquisition of the remaining interest in Choice Hotels Canada [41][42] Question: Long-term outlook for room growth in the U.S. - Management indicated that the focus remains on high-quality products in the pipeline, with expectations for continued growth in higher value segments [43][44] Question: Insights on the RevPAR environment and competition - Management noted that the current environment is cyclical, with signs of recovery in occupancy rates, particularly in the economy segment [46][48] Question: Expectations for 2026 and growth opportunities - Management highlighted the growing retiree demographic and the resilience of small business travelers as key drivers for future growth [50][52]