Financial Data and Key Metrics Changes - In 2025, the company delivered adjusted EBITDA of $626 million, up 4% year-over-year, and adjusted earnings per share of $6.94, also in line with expectations [4][19] - Fourth quarter revenues, excluding reimbursable revenue, increased 2% year-over-year to $234 million, with adjusted EBITDA at $141 million and adjusted earnings per share rising 3% year-over-year to $1.60 [20][19] - The global RevPAR declined 4.6% year-over-year in the fourth quarter on a currency-neutral basis, while international RevPAR increased 3.2% year-over-year [24][19] Business Line Data and Key Metrics Changes - The company achieved a 14% year-over-year growth in global hotel openings, with a significant focus on higher revenue brands [4][5] - In the extended stay segment, the company delivered its 10th consecutive quarter of double-digit system growth, with a record number of U.S. extended stay hotel openings, up 8% year-over-year [12][13] - The midscale segment saw a 47% increase in global hotel openings, with 18% more global midscale franchise agreements executed year-over-year [23][19] Market Data and Key Metrics Changes - In the Americas outside the U.S., RevPAR increased 5.4% year-over-year in 2025, with a 49% growth in the rooms pipeline in Canada [12][19] - The Asia-Pacific region led international RevPAR growth with an 11% increase [24][19] - The company expects U.S. net rooms growth to return to positive territory in 2026, supported by a larger hotel conversion pipeline [9][19] Company Strategy and Development Direction - The company is focused on enhancing franchisee economics and improving product quality, which is reflected in the higher average royalty rate achieved across the U.S. portfolio [5][19] - The company is strategically positioned in the value-driven travel segment, aiming to capture incremental market share as consumer spending on travel increases [9][19] - The company is expanding its international footprint, with direct franchised rooms now representing over 40% of its international portfolio, enhancing earnings per unit [11][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about U.S. lodging demand, citing favorable economic conditions such as declining gas prices and tax relief expected to stimulate travel [10][19] - The company anticipates continued growth in several consumer segments, including retirees and road trippers, supported by an improved portfolio of hotels [10][19] - Management expects adjusted EBITDA for 2026 to be in the range of $632 million to $647 million, reflecting organic growth and strong royalty rate growth [31][19] Other Important Information - The company returned $189 million to shareholders in 2025, including $54 million in dividends and $136 million in share repurchases [29][19] - The company is actively investing in technology to enhance customer engagement and streamline hotel booking processes [18][19] Q&A Session All Questions and Answers Question: Can you walk us through expectations for key money spending, CapEx, and JV investments in 2026? - The company expects key money spending to increase to between $105 million and $110 million in 2026, reflecting an acceleration of openings [35][19] Question: Where does the balance sheet need to get to for more aggressive buybacks? - The company is comfortable with its current net debt to EBITDA ratios and will prioritize investments back into the business before considering share buybacks [40][19] Question: Can you provide more color on U.S. rooms growth returning to positive this year? - The company is seeing an increase in mid-scale and economy franchises awarded, which, coupled with an increasing conversion pipeline, supports the expectation of positive U.S. net rooms growth [44][19] Question: How should we think about the RevPAR cadence for the year? - The company expects Q1 RevPAR to be negative due to hurricane impacts but anticipates an inflection point in Q2 as those impacts are lapped [56][19] Question: How long do you expect the removal process to take before settling into a normal NUG? - The company expects to return to a positive NUG this year, with ongoing opportunities to backfill lower-performing hotels with higher quality options [65][19]