CHOICE HOTELS INTERNATIONAL INC /DECHH
CHOICE HOTELS INTERNATIONAL INC /DE Segments Disclosure
Reportable Segment Information
The Hotel Franchising & Management reportable segment includes the Company's hotel franchising operations which consists of its 22 brands and brand extensions and the hotel management operations of 13 hotels (inclusive of four owned hotels). The 22 brands and brand extensions and hotel management operations are aggregated together within this reportable segment because they have similar economic characteristics, types of customers, distribution channels, and regulatory business environments. The revenues from the hotel franchising and management business include royalty fees, initial franchise fees and relicensing fees, cost reimbursement revenues, partnership services and fees, base and incentive management fees, and other hotel franchising and management-related revenue. The Company provides certain services under its franchise and management agreements which result in direct and indirect reimbursements. The cost reimbursement revenues received from the franchisees are included in Hotel Franchising & Management revenues and are offset by the related expenses in order to calculate Hotel Franchising & Management operating income. The equity in the earnings or losses from the hotel franchising-related investment in affiliates is allocated to the Hotel Franchising & Management reportable segment.
The Company evaluates its Hotel Franchising & Management reportable segment based primarily on the operating income of the segment without allocating corporate expenses or indirect general and administrative expenses. The Corporate & Other column includes the operations of the Company's owned hotels.
Intersegment Eliminations to revenues is the elimination of Hotel Franchising & Management revenue which includes royalty fees, management and cost reimbursement fees charged to our owned hotels against the franchise and management fee expense that is recognized by our owned hotels in Corporate & Other operating income (loss).
Our President and Chief Executive Officer, who is our chief operating decision maker ("CODM"), utilizes budgeted and forecasted financial information as well as industry metrics, such as RevPar, Occupancy, and ADR, to assess the performance and to make resource allocation decisions. The CODM does not use assets by operating segment when assessing the performance or when making operating segment resource allocation decisions and therefore, assets by segment are not disclosed below.
The following tables presents the financial information for the Company's segments:
| For the Year Ended December 31, 2025 | |||||||||||||||||||||||
| (in thousands) | Hotel Franchising & Management | Corporate & Other | Intersegment Eliminations | Consolidated | |||||||||||||||||||
| Revenues | $ | 1,472,535 | $ | 137,439 | $ | (13,181) | $ | 1,596,793 | |||||||||||||||
Other Segment Items (1) | 834,953 | 266,907 | (13,181) | 1,088,679 | |||||||||||||||||||
| Depreciation and amortization | 34,520 | 25,195 | — | 59,715 | |||||||||||||||||||
| Operating income (loss) | 603,062 | (154,663) | — | 448,399 | |||||||||||||||||||
| Reconciliation of segment profit or loss: | |||||||||||||||||||||||
| Interest expense | 91,148 | ||||||||||||||||||||||
| Interest income | (6,237) | ||||||||||||||||||||||
| Gain from an acquisition of a joint venture | (100,025) | ||||||||||||||||||||||
| Gain on sale of assets | (713) | ||||||||||||||||||||||
| Other gains, net | (6,989) | ||||||||||||||||||||||
| Equity in net loss of affiliates | 14,324 | ||||||||||||||||||||||
| Income before income taxes | $ | 456,891 | |||||||||||||||||||||
| For the Year Ended December 31, 2024 | |||||||||||||||||||||||
| (in thousands) | Hotel Franchising & Management | Corporate & Other | Intersegment Eliminations | Consolidated | |||||||||||||||||||
| Revenues | $ | 1,470,592 | $ | 126,450 | $ | (12,203) | $ | 1,584,839 | |||||||||||||||
Other Segment Items (1) | 857,843 | 223,473 | (12,203) | 1,069,113 | |||||||||||||||||||
| Depreciation and amortization | 28,450 | 23,503 | — | 51,953 | |||||||||||||||||||
| Operating income (loss) | 584,299 | (120,526) | — | 463,773 | |||||||||||||||||||
| Reconciliation of segment profit or loss: | |||||||||||||||||||||||
| Interest expense | 87,131 | ||||||||||||||||||||||
| Interest income | (8,646) | ||||||||||||||||||||||
| Loss on extinguishment of debt | 331 | ||||||||||||||||||||||
| Other losses, net | 1,641 | ||||||||||||||||||||||
| Equity in net gain of affiliates | (12,329) | ||||||||||||||||||||||
| Income before income taxes | $ | 395,645 | |||||||||||||||||||||
| For the Year Ended December 31, 2023 | |||||||||||||||||||||||
| (in thousands) | Hotel Franchising & Management | Corporate & Other | Intersegment Eliminations | Consolidated | |||||||||||||||||||
| Revenues | $ | 1,444,394 | $ | 110,854 | $ | (11,083) | $ | 1,544,165 | |||||||||||||||
Other Segment Items (1) | 911,301 | 223,881 | (11,083) | 1,124,099 | |||||||||||||||||||
| Depreciation and amortization | 24,562 | 20,476 | — | 45,038 | |||||||||||||||||||
| Operating income (loss) | 508,531 | (133,503) | — | 375,028 | |||||||||||||||||||
| Reconciliation of segment profit or loss: | |||||||||||||||||||||||
| Interest expense | 63,780 | ||||||||||||||||||||||
| Interest income | (7,764) | ||||||||||||||||||||||
| Gain on extinguishment of debt | (4,416) | ||||||||||||||||||||||
| Other gains, net | (10,649) | ||||||||||||||||||||||
| Equity in net gain of affiliates | (2,879) | ||||||||||||||||||||||
| Income before income taxes | $ | 336,956 | |||||||||||||||||||||
(1) Other segment items for the reportable segment include selling, general and administrative expenses and reimbursable expenses from franchised and managed properties. | |||||||||||||||||||||||
For the years ended December 31, 2025, 2024, and 2023, the revenues generated by the international operations, including royalty fees, cost reimbursement revenues, partnership services and fees, and other revenues, were $117.8 million, $102.7 million, and $103.2 million, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 20, 2024 | |
| 2022 | Mar 1, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Mar 2, 2020 | |
| 2018 | Feb 26, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Feb 27, 2017 | |
| 2015 | Feb 29, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.