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 [5][20] - 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 [21] Business Line Data and Key Metrics Changes - The company achieved a 14% year-over-year growth in global hotel openings and a 12% increase in U.S. conversion franchise agreements [5][8] - The extended stay segment represented over 40% of the U.S. pipeline, with a record number of U.S. extended stay hotel openings, up 8% year-over-year [13][14] - In the midscale segment, global hotel openings increased by 47%, and franchise agreements were up 18% year-over-year [23] Market Data and Key Metrics Changes - International revenues grew by 37% in 2025, with RevPAR in the Americas outside the U.S. increasing by 5.4% year-over-year [11][12] - The Asia-Pacific region led international RevPAR growth with an 11% increase [24] 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 [6][26] - The strategy includes expanding the international footprint and strengthening the leadership position in the extended stay segment [5][11] - The company is investing in technology and partnerships to enhance customer engagement and capture incremental demand [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about U.S. lodging demand, citing favorable consumer trends and upcoming national events as demand catalysts [9][10] - The company expects U.S. net rooms growth to return to positive territory in 2026, supported by a larger hotel conversion pipeline [9][31] - Management noted that the previous year's weaknesses were primarily transitory and not structural, indicating a constructive outlook for RevPAR in 2026 [48] Other Important Information - The company ended 2025 with total liquidity of $571 million and a net debt to trailing twelve-month EBITDA ratio of 3x, indicating a strong balance sheet [28] - The capital allocation framework prioritizes high-return organic investments, selective acquisitions, and returning excess capital to shareholders [29] Q&A Session Summary Question: Spending outlook for key money, CapEx, and JV investments in 2026 - The company expects key money spending to increase to between $105 million and $110 million in 2026, with a significant reduction in recyclable capital outlays to $20-$45 million [36][38] Question: Balance sheet requirements for aggressive buybacks - Management indicated that they are comfortable with their current net debt to EBITDA ratios and will prioritize investments and M&A before considering share buybacks [40][42] Question: U.S. rooms growth returning to positive - Management highlighted an increase in mid-scale and economy franchises awarded, along with a 12% increase in the conversion pipeline, as factors supporting positive U.S. rooms growth [44][45] Question: RevPAR guidance and potential tailwinds - Management noted that while some demand catalysts are not fully baked into guidance, they are optimistic about the impact of tax relief and a weaker U.S. dollar on domestic travel [46][48] Question: Duration of the removal process for underperforming properties - Management stated that the company will continue to naturally cull underperforming properties, with a focus on backfilling with higher quality hotels [56][58]