Choice Hotels Q2 Profit Down, Adj. EPS Beats Street; Cuts FY25 Outlook - Update

(RTTNews) - Choice Hotels International, Inc (CHH), while reporting weak second-quarter profit, but above market estimates, on Wednesday trimmed fiscal 2025 outlook for earnings and RevPAR.

In the pre-market activity on the NYSE, Choice Hotels shares were gaining around 0.9 percent to trade at $126.26.

For fiscal 2025, the company now expects net income of $261 million to $276 million, lower than previously expected $275 million to $290 million.

Earnings per share is now projected to be $5.54 to $5.86, down from previous view of $5.86 to $6.18.

Meanwhile, Choice Hotels continues to expect adjusted net income of $324 million to $339 million, while outlook for adjusted earnings per share has been trimmed to $6.88 to $7.20 from the $6.90 to $7.22 expected earlier.

The Wall Street analysts on average expect the company to report earnings of $7.04 per share. Analysts' estimates typically exclude special items.

Further, the company now expects domestic RevPAR growth to be down 3 percent to 0 percent, compared to previous estimate of down 1 percent to up 1 percent.

The company is adjusting its RevPAR outlook to reflect a more moderate domestic expectation amidst a changing macroeconomic backdrop.

In the second quarter, Choice Hotels' earnings totaled $81.73 million or $1.75 per share, compared with $87.14 million, or $1.80 per share, last year.

Adjusted earnings were $89.78 million or $1.92 per share for the period. Analysts had expected the company to earn $1.90 per share.

The company's revenue for the period fell 2.0 percent to $426.44 million from $435.16 million last year.

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