10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 _____________________________________________ 

FORM 10-Q

 _____________________________________________ 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED September 30, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NO. 001-13393

 _____________________________________________ 

CHOICE HOTELS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

_____________________________________________ 

Delaware		52-1209792
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)
1 Choice Hotels Circle		20850
Rockville,	Maryland
(Address of Principal Executive Offices)		(Zip Code)

(Registrant’s telephone number, including area code): (301) 592-5000

(Former name, former address and former fiscal year, if changed since last report): N/A

 ________________________________________________________ 

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, Par Value $0.01 per share	CHH	New York Stock Exchange

_____________________________________________  

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒     No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ☐ No  ☒

The number of shares of common stock outstanding on October 31, 2023 was 49,798,586.

CHOICE HOTELS INTERNATIONAL, INC.

INDEX

	PAGE NO.
PART I. FINANCIAL INFORMATION
Item 1—Financial Statements (Unaudited)	3
Consolidated Statements of Income -- For the three and nine months ended September 30, 2023 and 2022	3
Consolidated Statements of Comprehensive Income -- For the three and nine months ended September 30, 2023 and 2022	4
Consolidated Balance Sheets -- As of September 30, 2023 and December 31, 2022	5
Consolidated Statements of Cash Flows -- For the nine months ended September 30, 2023 and 2022	6
Consolidated Statements of Shareholders' Equity -- For the three and nine months ended September 30, 2023 and 2022	7
Notes to Consolidated Financial Statements	9
Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3—Quantitative and Qualitative Disclosures About Market Risk	37
Item 4—Controls and Procedures	37
PART II. OTHER INFORMATION
Item 1—Legal Proceedings	38
Item 1A—Risk Factors	38
Item 2—Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3—Defaults Upon Senior Securities	38
Item 4—Mine Safety Disclosures	38
Item 5—Other Information	38
Item 6—Exhibits	39
SIGNATURES	40

2

PART I. FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

CHOICE HOTELS INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF INCOME

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

(UNAUDITED)

        

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
REVENUES
Royalty, licensing and management fees	$	148,512	$	144,020	$	396,503	$	356,208
Initial franchise fees	6,194		7,011		21,240		21,635
Platform and procurement services fees	15,542		14,401		58,186		47,887
Owned hotels	26,239		19,992		74,075		49,220
Other	11,436		31,432		33,211		51,588
Other revenues from franchised and managed properties	217,634		197,410		602,554		513,429
Total revenues	425,557		414,266		1,185,769		1,039,967
OPERATING EXPENSES
Selling, general and administrative	54,913		70,202		182,000		144,414
Depreciation and amortization	9,633		8,726		29,468		20,436
Owned hotels	18,628		13,158		53,924		32,004
Other expenses from franchised and managed properties	207,341		190,541		583,095		458,037
Total operating expenses	290,515		282,627		848,487		654,891
Gain on sale of business and assets, net	—		13,379		—		16,688
Operating income	135,042		145,018		337,282		401,764
OTHER INCOME AND EXPENSES, NET
Interest expense	16,168		9,362		46,522		32,084
Interest income	(1,897)		(2,348)		(5,836)		(5,256)
Other loss (gain)	1,343		2,303		(2,752)		9,578
Equity in net gain of affiliates	(1,801)		(1,075)		(1,923)		(1,279)
Total other income and expenses, net	13,813		8,242		36,011		35,127
Income before income taxes	121,229		136,776		301,271		366,637
Income tax expense	29,205		33,696		71,717		89,998
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Basic earnings per share	$	1.83	$	1.87	$	4.51	$	4.98
Diluted earnings per share	$	1.81	$	1.85	$	4.47	$	4.93
Cash dividends declared per share	$	0.2875	$	0.2375	$	0.8625	$	0.7125

The accompanying notes are an integral part of these consolidated financial statements.

3

CHOICE HOTELS INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(IN THOUSANDS)

(UNAUDITED)

        

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2023		2022		2023		2022
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	(191)		(902)		498		(1,139)
Other comprehensive income (loss), net of tax	(191)		(902)		498		(1,139)
Comprehensive income	$	91,833	$	102,178	$	230,052	$	275,500

The accompanying notes are an integral part of these consolidated financial statements.

4

CHOICE HOTELS INTERNATIONAL, INC.

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

(UNAUDITED)

	September 30, 2023		December 31, 2022
ASSETS
Current assets
Cash and cash equivalents	$	36,432	$	41,566
Accounts receivable (net of allowance for credit losses of $28,883 and $23,435, respectively)	223,781		216,614
Income taxes receivable	5,743		4,759
Notes receivable (net of allowance for credit losses of $2,206 and $4,125, respectively)	52,726		52,466
Prepaid expenses and other current assets	34,130		32,517
Total current assets	352,812		347,922
Property and equipment (net of accumulated depreciation and amortization of $292,786 and $253,323, respectively)	469,771		427,306
Operating lease right-of-use assets	90,474		68,985
Goodwill	220,187		218,653
Intangible assets (net of accumulated amortization of $220,803 and $201,401, respectively)	781,101		742,190
Notes receivable (net of allowance for credit losses of $6,183 and $6,047, respectively)	49,831		55,577
Investments for employee benefit plans, at fair value	35,815		31,645
Investments in affiliates	55,081		30,647
Deferred income taxes	92,410		88,182
Other assets	84,755		91,068
Total assets	$	2,232,237	$	2,102,175
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	124,113	$	118,863
Accrued expenses and other current liabilities	96,523		131,410
Deferred revenue	107,802		92,695
Current portion of long-term debt	4,416		2,976
Liability for guest loyalty programs	86,140		89,954
Total current liabilities	418,994		435,898
Long-term debt	1,391,272		1,200,547
Long-term deferred revenue	135,009		134,149
Deferred compensation and retirement plan obligations	41,200		36,673
Income taxes payable	8,601		15,482
Operating lease liabilities	109,746		70,994
Liability for guest loyalty programs	44,320		47,381
Other liabilities	10,682		6,391
Total liabilities	2,159,824		1,947,515
Commitments and contingencies (Note 12)
Common stock, $0.01 par value; 160,000,000 shares authorized; 95,065,638 shares issued at September 30, 2023 and December 31, 2022; 50,026,433 and 52,200,903 shares outstanding at September 30, 2023 and December 31, 2022, respectively	951		951
Additional paid-in-capital	321,790		298,053
Accumulated other comprehensive loss	(4,713)		(5,211)
Treasury stock, at cost; 45,039,205 and 42,864,735 shares at September 30, 2023 and December 31, 2022, respectively	(1,987,262)		(1,694,857)
Retained earnings	1,741,647		1,555,724
Total shareholders’ equity	72,413		154,660
Total liabilities and shareholders’ equity	$	2,232,237	$	2,102,175

The accompanying notes are an integral part of these consolidated financial statements.

5

CHOICE HOTELS INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

(UNAUDITED)

	Nine Months Ended
	September 30,
	2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	229,554	$	276,639
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	29,468		20,436
Depreciation and amortization – marketing and reservation system	27,544		23,237
Gain on sale of business and assets, net	—		(16,688)
Franchise agreement acquisition cost amortization	14,616		11,558
Non-cash share-based compensation and other charges	34,670		28,621
Non-cash interest, investment, and affiliate (income) loss, net	(1,709)		9,135
Deferred income taxes	(4,315)		(22,402)
Equity in net (gain) loss of affiliates, less distributions received	(621)		2,451
Franchise agreement acquisition costs, net of reimbursements	(72,867)		(32,947)
Change in working capital and other	(9,150)		(34,838)
Net cash provided by operating activities	247,190		265,202
CASH FLOWS FROM INVESTING ACTIVITIES
Investments in property and equipment	(81,403)		(66,084)
Investments in intangible assets	(1,893)		(3,247)
Asset acquisitions, net of cash paid	—		(856)
Proceeds from the sale of assets and business	—		140,554
Proceeds from the termination of intangible assets	—		5,698
Business acquisitions, net of cash acquired	—		(550,431)
Contributions to investments in affiliates	(24,573)		(4,264)
Proceeds from the sale of affiliates	868		—
Purchases of investments for employee benefit plans	(3,678)		(3,719)
Proceeds from sales of investments for employee benefit plans	1,263		1,896
Issuances of notes receivable	(4,319)		(5,617)
Collections of notes receivable	9,923		701
Other items, net	547		1,708
Net cash used in investing activities	(103,265)		(483,661)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments to extinguish acquired debt	—		(55,975)
Proceeds from acquired derivative	—		1,943
Net borrowings pursuant to revolving credit facilities	191,500		315,000
Principal payments on 2012 senior notes	—		(216,571)
Debt issuance costs	(755)		(24)
Purchases of treasury stock	(304,400)		(246,530)
Proceeds from the exercise of stock options	6,719		2,361
Dividends paid	(42,073)		(39,697)
Net cash used in financing activities	(149,009)		(239,493)
Net change in cash and cash equivalents	(5,084)		(457,952)
Effect of foreign exchange rate changes on cash and cash equivalents	(50)		(1,112)
Cash and cash equivalents, beginning of period	41,566		511,605
Cash and cash equivalents, end of period	$	36,432	$	52,541
Supplemental disclosure of cash flow information:
Cash payments during the period for
Income taxes, net of refunds	$	70,614	$	81,479
Interest, net of capitalized interest	$	44,993	$	36,691
Non-cash investing and financing activities
Dividends declared but not paid	$	15,239	$	12,776
Investment in property, equipment and intangible assets acquired in accounts payable and accrued liabilities	$	8,064	$	5,352
Asset acquisition from extinguishment of note receivable	$	—	$	20,446

The accompanying notes are an integral part of these consolidated financial statements.

6

CHOICE HOTELS INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(IN THOUSANDS, EXCEPT SHARE AMOUNTS)

(UNAUDITED)

	Common Stock - Shares Outstanding	Common Stock - Par Value		Additional Paid-in- Capital		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Retained Earnings		Total
Balance as of December 31, 2021	55,609,226	$	951	$	259,317	$	(4,574)	$	(1,265,032)	$	1,275,220	$	265,882
Net income	—	—		—		—		—		67,391		67,391
Other comprehensive income (loss), net of tax	—	—		—		(134)		—		—		(134)
Share-based payment activity(1)	262,008	—		6,068		—		3,486		4		9,558
Dividends declared ($0.2375 per share)	—	—		—		—		—		(13,250)		(13,250)
Treasury purchases	(100,912)	—		—		—		(14,802)		—		(14,802)
Balance as of March 31, 2022	55,770,322	$	951	$	265,385	$	(4,708)	$	(1,276,348)	$	1,329,365	$	314,645
Net income	—	—		—		—		—		106,168		106,168
Other comprehensive income (loss), net of tax	—	—		—		(103)		—		—		(103)
Share-based payment activity(1)	12,422	—		8,999		—		596		—		9,595
Dividends declared ($0.2375 per share)	—	—		—		—		—		(13,242)		(13,242)
Treasury purchases	(2,422)	—		—		—		(338)		—		(338)
Balance as of June 30, 2022	55,780,322	$	951	$	274,384	$	(4,811)	$	(1,276,090)	$	1,422,291	$	416,725
Net income	—	—		—		—		—		103,080		103,080
Other comprehensive income (loss), net of tax	—	—		—		(902)		—		—		(902)
Share-based payment activity(1)	(1,655)	—		9,708		—		55		—		9,763
Dividends declared ($0.2375 per share)	—	—		—		—		—		(12,767)		(12,767)
Treasury purchases	(2,005,000)	—		—		—		(231,388)		—		(231,388)
Balance as of September 30, 2022	53,773,667	$	951	$	284,092	$	(5,713)	$	(1,507,423)	$	1,512,604	$	284,511

7

	Common Stock - Shares Outstanding	Common Stock - Par Value		Additional Paid-in- Capital		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Retained Earnings		Total
Balance as of December 31, 2022	52,200,903	$	951	$	298,053	$	(5,211)	$	(1,694,857)	$	1,555,724	$	154,660
Net income	—	—		—		—		—		52,820		52,820
Other comprehensive income (loss), net of tax	—	—		—		394		—		—		394
Share-based payment activity(1)	315,049	—		1,899		—		13,497		—		15,396
Dividends declared ($0.2875 per share)	—	—		—		—		—		(14,709)		(14,709)
Treasury purchases(2)	(1,341,520)	—		—		—		(161,553)		—		(161,553)
Balance as of March 31, 2023	51,174,432	$	951	$	299,952	$	(4,817)	$	(1,842,913)	$	1,593,835	$	47,008
Net income	—	—		—		—		—		84,710		84,710
Other comprehensive income (loss), net of tax	—	—		—		295		—		—		295
Share-based payment activity(1)	10,508	—		11,336		—		579		—		11,915
Dividends declared ($0.2875 per share)	—	—		—		—		—		(14,540)		(14,540)
Treasury purchases(2)	(619,059)	—		—		—		(74,697)		—		(74,697)
Balance as of June 30, 2023	50,565,881	$	951	$	311,288	$	(4,522)	$	(1,917,031)	$	1,664,005	$	54,691
Net income	—	—		—		—		—		92,024		92,024
Other comprehensive income (loss), net of tax	—	—		—		(191)		—		—		(191)
Share-based payment activity(1)	22,372	—		10,502		—		403		—		10,905
Dividends declared ($0.2875 per share)	—	—		—		—		—		(14,382)		(14,382)
Treasury purchases(2)	(561,820)	—		—		—		(70,634)		—		(70,634)
Balance as of September 30, 2023	50,026,433	$	951	$	321,790	$	(4,713)	$	(1,987,262)	$	1,741,647	$	72,413

(1) During certain periods presented, accumulated dividends were paid to certain shareholders upon vesting of their performance vested restricted stock units ("PVRSU") which are presented in Share-based payment activity.

(2) Beginning January 1, 2023, Treasury purchases include an excise tax as imposed by the Inflation Reduction Act of 2022.

The accompanying notes are an integral part of these consolidated financial statements.

8

CHOICE HOTELS INTERNATIONAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.    Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial statements of Choice Hotels International, Inc. and subsidiaries (collectively, "Choice" or the "Company") have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). All significant intercompany accounts and transactions between the Company and its subsidiaries have been eliminated in consolidation.

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments that are necessary to fairly present the Company's financial position and results of operations. Except as otherwise disclosed, all adjustments are of a normal recurring nature.

Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been omitted. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2022 and the notes thereto included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on March 1, 2023. Interim results are not necessarily indicative of the entire year's results.

Acquisition of Radisson Hotels Americas

On August 11, 2022, the Company completed the acquisition (the "Transaction") of (1) all of the issued and outstanding shares of Radisson Hospitality, Inc. and (2) certain trademarks held by Radisson Hospitality Belgium BV/SRL (collectively referred to as "Radisson Hotels Americas").

The Company determined that it was the accounting acquirer of Radisson Hotels Americas and accounted for the Transaction as a business combination using the acquisition method of accounting. Accordingly, the assets acquired and the liabilities assumed were recorded at their fair values as of the August 11, 2022 acquisition date, with the exception of certain assets and liabilities which were accounted for in accordance with the provisions of ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08"). The Company finalized the purchase price allocation for the Transaction in the third quarter of 2023. Refer to Note 14.

The Company's consolidated statements of income include Radisson Hotels Americas' results of operations in the three and nine months ended September 30, 2023, but our consolidated statements of income only partially include Radisson Hotels Americas' results of operations in the three and nine months ended September 30, 2022 because the Company did not acquire Radisson Hotels Americas until August 11, 2022.

Summary of Significant Accounting Policies

The Company’s significant accounting policies are detailed in the “Summary of Significant Accounting Policies” section of Note 1 in the Annual Report on Form 10-K for the year ended December 31, 2022.

Recently Adopted Accounting Standards

In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses ("ASU 2022-02"). ASU 2022-02 eliminates the recognition and measurement guidance on troubled debt restructuring for creditors that have adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) ("Topic 326"), requires enhanced disclosures about loan modifications for borrowers experiencing financial difficulty, and includes new guidance on current-period gross write-offs presentation. ASU 2022-02 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. The Company adopted ASU 2022-02 on a prospective basis effective January 1, 2023, and concluded there is no material impact to the consolidated financial statements or disclosures through the third quarter of 2023.

9

2.    Revenue

Contract Liabilities

Contract liabilities relate to (i) advance consideration received related to services considered to be a part of the brand intellectual property performance obligation, such as initial franchise fees that are paid when a franchise agreement is executed and system implementation fees that are paid at the time of installation, and (ii) amounts received when loyalty points are issued but the associated revenue has not yet been recognized since the related loyalty points have not been redeemed.

Deferred revenues from initial fees and system implementation fees are typically recognized over a five- to ten-year period, unless the franchise agreement is terminated and the hotel exits the franchise system whereby remaining deferred amounts are recognized to revenue in the period of termination. Loyalty points are typically redeemed within three years of issuance.

The following table summarizes the significant changes in the contract liabilities balances during the period from December 31, 2022 to September 30, 2023:

(in thousands)
Balance as of December 31, 2022	$	209,359
Increases to the contract liability balance due to cash received	105,305
Revenue recognized in the period	(99,475)
Balance as of September 30, 2023	$	215,189

Remaining Performance Obligations

The aggregate amount of the transaction price that is allocated to unsatisfied, or partially unsatisfied, performance obligations was $215.2 million as of September 30, 2023. This amount represents the fixed transaction price that will be recognized as revenue in future periods, which is presented as current and non-current deferred revenue in the consolidated balance sheets.

Based on the practical expedient elections permitted by ASU 2014-09, Revenue From Contracts with Customers (Topic 606) and subsequent amendments ("Topic 606"), the Company does not disclose the value of unsatisfied performance obligations for (i) variable consideration subject to the sales or usage-based royalty constraint or comprising a component of a series (including franchise, partnership, qualified vendor, and software as a service ("SaaS") agreements), (ii) variable consideration for which we recognize revenue at the amount to which we have the right to invoice for services performed, or (iii) contracts with an expected original duration of one year or less.

Disaggregation of Revenue

	Three Months Ended						Three Months Ended
	September 30, 2023						September 30, 2022
(in thousands)	Over time		Point in time		Total		Over time		Point in time		Total
Royalty, licensing and management fees	$	145,830	$	2,682	$	148,512	$	143,987	$	33	$	144,020
Initial franchise fees	6,194		—		6,194		7,011		—		7,011
Platform and procurement services fees	14,874		668		15,542		13,628		773		14,401
Owned hotels	19,497		6,742		26,239		14,877		5,115		19,992
Other	11,436		—		11,436		31,432		—		31,432
Other revenues from franchised and managed properties	200,399		17,235		217,634		178,349		19,061		197,410
Total revenues	$	398,230	$	27,327	$	425,557	$	389,284	$	24,982	$	414,266
	Nine Months Ended						Nine Months Ended
	September 30, 2023						September 30, 2022
(in thousands)	Over time		Point in time		Total		Over time		Point in time		Total
Royalty, licensing and management fees	$	389,332	$	7,171	$	396,503	$	356,175	$	33	$	356,208
Initial franchise fees	21,240		—		21,240		21,635		—		21,635
Platform and procurement services fees	56,112		2,074		58,186		45,503		2,384		47,887
Owned hotels	55,544		18,531		74,075		39,720		9,500		49,220
Other	33,211		—		33,211		51,588		—		51,588
Other revenues from franchised and managed properties	546,332		56,222		602,554		438,734		74,695		513,429
Total revenues	$	1,101,771	$	83,998	$	1,185,769	$	953,355	$	86,612	$	1,039,967

The owned hotels revenues that are recognized at a point in time represent the goods and services that are purchased independently of the hotel stay, such as food and beverage, incidentals, and parking fees. The remaining revenues that are recognized at a point in time represent the loyalty points that are redeemed by members for benefits (with both franchisees and third-party partners), net of the cost of redemptions.

During the three and nine months ended September 30, 2022, Other revenues included contract termination fee revenue of $22.7 million from the exit of 110 WoodSpring units in September 2022. The contract termination fee revenue consisted of $67.4 million in consideration, less the $44.7 million in intangible assets that were initially recognized on the date of the WoodSpring acquisition.

As presented in Note 11, the Corporate & Other segment revenue amounts are $33.8 million and $29.7 million for the three months ended September 30, 2023 and 2022, respectively, and $86.5 million and $63.4 million for the nine months ended September 30, 2023 and 2022, respectively, and are primarily included in Other revenue and Owned hotels revenue in the consolidated statements of income. The remaining revenues relate to the Hotel Franchising & Management reportable segment.

Royalty, licensing and management fees and Other revenues from franchised and managed properties are presented net of intersegment revenues of $4.0 million and $1.6 million for the three months ended September 30, 2023 and 2022, respectively, and $7.3 million and $3.7 million for the nine months ended September 30, 2023 and 2022, respectively.

3.    Receivables and Allowance for Credit Losses

Notes Receivable

The Company has provided financing in the form of notes receivable loans to franchisees to support the development of hotel properties in strategic markets. The Company's credit quality indicator is the level of security in the note receivable.

10

The following table summarizes the composition of the notes receivable balances by credit quality indicator and the allowance for credit losses:

(in thousands)	September 30, 2023		December 31, 2022
Senior	$	86,374	$	95,466
Subordinated	19,592		17,075
Unsecured	4,980		5,674
Total notes receivable	$	110,946	$	118,215
Less: allowance for credit losses	8,389		10,172
Total notes receivable, net of allowance for credit losses	$	102,557	$	108,043
Current portion, net of allowance for credit losses	$	52,726	$	52,466
Long-term portion, net of allowance for credit losses	$	49,831	$	55,577

The following table summarizes the amortized cost basis of the notes receivable by the year of origination and credit quality indicator:

(in thousands)	2023		2022		2021		2020		2019		Prior		Total
Senior	$	—	$	—	$	—	$	—	$	29,083	$	57,291	$	86,374
Subordinated	3,493		—		1,994		—		—		14,105		19,592
Unsecured	—		215		1,292		903		208		2,362		4,980
Total notes receivable	$	3,493	$	215	$	3,286	$	903	$	29,291	$	73,758	$	110,946

The following table summarizes the activity related to the Company’s notes receivable allowance for credit losses:

(in thousands)	September 30, 2023		December 31, 2022
Beginning balance	$	10,172	$	16,779
Provision for credit losses	154		(938)
Recoveries	(1,937)		(5,669)
Ending balance	$	8,389	$	10,172

As of both September 30, 2023 and December 31, 2022, one note receivable loan with a senior credit quality indicator met the definition of collateral-dependent and is collateralized by membership interests in the borrowing entities and the associated land parcel. The Company used a market approach using quoted market prices to value the underlying collateral. The Company reviewed the borrower's financial statements, economic trends, industry projections for the market, and comparable sales capitalization rates, which represent significant inputs to the cash flow projections. These nonrecurring fair value measurements are classified as Level 3 in the fair value measurement hierarchy because they are unobservable inputs which are significant to the overall fair value. Based on the Company's analysis, the fair value of the collateral secures substantially all of the carrying value of the loan. The allowances for credit losses attributable to collateral-dependent loans are $0.9 million as of both September 30, 2023 and December 31, 2022, respectively.

Recoveries during the nine months ended September 30, 2023 were primarily associated with cash collections pursuant to a settlement agreement with a borrower. Recoveries during the year ended December 31, 2022 were primarily associated with a loan that was previously classified as collateral-dependent and was settled in exchange for an operating hotel on April 14, 2022.

The Company considers loans past due and in default when payments are not made when due in accordance with the then-current loan provisions or the terms extended to the borrowers, including loans with concessions or interest deferral. The Company suspends the accrual of interest when payments on loans are more than 30 days past due or upon a loan being classified as collateral-dependent. The Company applies the payments received for loans on a non-accrual status first to interest and then to principal. The Company does not resume an interest accrual until all delinquent payments are received based on the then-current loan provisions. The amortized cost basis of the notes receivable in a non-accrual status was $16.5 million and $18.7 million as of September 30, 2023 and December 31, 2022, respectively.

The Company has notes receivable loans totaling approximately $4.4 million and $4.8 million as of September 30, 2023 and December 31, 2022, respectively, with stated interest rates that are lower than market interest rates, representing a total unamortized discount of less than $0.1 million as of both September 30, 2023 and December 31, 2022. These discounts are reflected as a reduction of the outstanding notes receivable loan amounts and are amortized over the life of the related loan.

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The following table summarizes the past due balances by credit quality indicator of the notes receivable:

(in thousands)	1- 30 days Past Due		31-89 days Past Due		> 90 days Past Due		Total Past Due		Current		Total  Notes Receivable
As of September 30, 2023
Senior	$	—	$	—	$	44,283	$	44,283	$	42,091	$	86,374
Subordinated	—		—		271		271		19,321		19,592
Unsecured	—		—		400		400		4,580		4,980
	$	—	$	—	$	44,954	$	44,954	$	65,992	$	110,946
As of December 31, 2022
Senior	$	—	$	15,200	$	—	$	15,200	$	80,266	$	95,466
Subordinated	—		—		2,209		2,209		14,866		17,075
Unsecured	20		40		40		99		5,575		5,674
	$	20	$	15,240	$	2,249	$	17,508	$	100,707	$	118,215

Variable Interest through Notes Issued

The Company has issued notes receivable loans to certain entities that have created variable interests in the associated borrowers totaling $98.4 million and $103.2 million as of September 30, 2023 and December 31, 2022, respectively. The Company has determined that it is not the primary beneficiary of these variable interest entities ("VIEs").

Accounts Receivable

Accounts receivable consists primarily of franchise and related fees due from the hotel franchisees and are recorded at the invoiced amount.

During the nine months ended September 30, 2023, the Company recognized provisions for credit losses on accounts receivable of $4.2 million in selling, general and administrative ("SG&A") expenses and $4.0 million in other expenses from franchised and managed properties. During the nine months ended September 30, 2022, the Company recognized a reversal of provisions for credit losses on accounts receivable of $0.4 million in SG&A expenses and provisions for credit losses on accounts receivable of $0.5 million in other expenses from franchised and managed properties. During the nine months ended September 30, 2023 and 2022, the Company recorded write-offs, net of recoveries, through the accounts receivable allowance for credit losses of $2.8 million and $12.9 million, respectively.

4.    Investments in Affiliates

The Company has equity method investments in affiliates primarily related to the Company's program to offer equity support to qualified franchisees to develop and operate Everhome Suites and Cambria Hotels in strategic markets.

As of September 30, 2023 and December 31, 2022, the Company had total investments in affiliates in the consolidated balance sheets of $55.1 million and $30.6 million, respectively, which included investments in affiliates that represent VIEs of $45.3 million and $24.4 million, respectively. The Company has determined that it is not the primary beneficiary of any of these VIEs, however the Company does exercise significant influence through its equity ownership and as a result, the investments in these affiliates are accounted for under the equity method. During the three months ended September 30, 2023 and 2022, the Company recognized losses totaling $0.9 million and $1.1 million, respectively, from these investments that represent VIEs. During the nine months ended September 30, 2023 and 2022, the Company recognized losses totaling $3.2 million and $2.7 million, respectively, from these investments that represent VIEs. The Company's maximum exposure to losses related to its investments in the VIEs is limited to the total of its respective equity investment as well as certain limited payment guaranties, which are described in Note 12 of these consolidated financial statements.

The Company recognized no impairment charges related to its equity method investments during the nine months ended September 30, 2023 and 2022.

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5.    Debt

Debt consists of the following:

	September 30, 2023		December 31, 2022
	(in thousands)
$450 million senior unsecured notes due 2031 ("2020 Senior Notes") with an effective interest rate of 3.86%, less a discount and deferred issuance costs of $4.5 million and $4.9 million at September 30, 2023 and December 31, 2022, respectively	$	445,537	$	445,080
$400 million senior unsecured notes due 2029 ("2019 Senior Notes") with an effective interest rate of 3.88%, less a discount and deferred issuance costs of $3.7 million and $4.2 million at September 30, 2023 and December 31, 2022, respectively	396,290		395,838
$850 million senior unsecured revolving credit facility with an effective interest rate of 6.40% less deferred issuance costs of $2.1 million and $1.8 million at September 30, 2023 and December 31, 2022, respectively (1)	549,445		358,189
Economic development loans with an effective interest rate of 3.00% at September 30, 2023 and December 31, 2022, respectively	4,416		4,416
Total debt	$	1,395,688	$	1,203,523
Less current portion	4,416		2,976
Long-term debt	$	1,391,272	$	1,200,547

(1) On February 14, 2023, the Company entered into a Third Amendment to the Amended and Restated Senior Unsecured Credit Agreement (the "Amendment"). The Amendment provides, among other things, for (i) an increase in the aggregate amount of commitments under the Company's existing $600 million unsecured credit facility (the "Revolver") by $250 million (the “Increased Commitments”) to an aggregate amount of $850 million and (ii) the replacement of the interest reference rate for U.S. dollar-denominated borrowings under the Revolver from the London Interbank Offered Rate ("LIBOR") to an adjusted Secured Overnight Financing Rate ("SOFR"). The pricing and other terms applicable to the Increased Commitments are the same as those applicable to the existing revolving loan commitments that were in effect prior to the Amendment. Except as amended by the Amendment, the remaining terms of the unsecured credit facility remain in full force and effect.

Refer to Note 12 and the Liquidity and Capital Resources section of "Management's Discussion and Analysis of Financial Condition and Results of Operations" for more information.

6.    Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2023 and 2022 were as follows:

(in thousands)
Balance as of December 31, 2022	$	(5,211)
Other comprehensive income (loss) before reclassification	498
Balance as of September 30, 2023	$	(4,713)

(in thousands)
Balance as of December 31, 2021	$	(4,574)
Other comprehensive income (loss) before reclassification	(1,139)
Balance as of September 30, 2022	$	(5,713)

The other comprehensive income (loss) before reclassification for both the nine months ended September 30, 2023 and 2022 relate to foreign currency items, and there were no amounts reclassified from accumulated other comprehensive loss during either period.

7.    Fair Value Measurements

The Company estimates the fair value of its financial instruments utilizing a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The following summarizes the three levels of inputs, as well as the assets that the Company values using those levels of inputs on a recurring basis.

Level 1: Quoted prices in active markets for identical assets and liabilities. The Company’s Level 1 assets consist of marketable securities (primarily mutual funds) held in the Company's Deferred Compensation Plan.

Level 2: Observable inputs, other than quoted prices in active markets for identical assets and liabilities, such as quoted prices for similar assets and liabilities, quoted prices in markets that are not active, or other inputs that are observable. The Company’s Level 2 assets consist of money market funds held in the Company's Deferred Compensation Plan.

Level 3: Unobservable inputs, supported by little or no market data available, where the reporting entity is required to develop its own assumptions to determine the fair value of the instrument. The Company does not currently have any assets recorded at fair value on a recurring basis whose fair value was determined using Level 3 inputs and there were no transfers of Level 3 assets during the nine months ended September 30, 2023 and year ended December 31, 2022.

As of September 30, 2023 and December 31, 2022, the Company recognized the following assets at fair value on a recurring basis in the consolidated balance sheets:

	Fair Value Measurements at Reporting Date Using
(in thousands)	Total		Level 1		Level 2		Level 3
As of September 30, 2023
Mutual funds (1)	$	33,216	$	33,216	$	—	$	—
Money market funds (1)	4,568		—		4,568		—
Total	$	37,784	$	33,216	$	4,568	$	—
As of December 31, 2022
Mutual funds (1)	$	29,143	$	29,143	$	—	$	—
Money market funds (1)	3,242		—		3,242		—
Total	$	32,385	$	29,143	$	3,242	$	—

(1) The current assets at fair value noted above are presented in Prepaid expenses and other assets, and the long-term assets at fair value noted above are presented in Investments for employee benefit plans, at fair value, in the consolidated balance sheets.

Other financial instruments disclosure

The Company believes that the fair values of its current assets and current liabilities approximate their reported carrying amounts due to the short-term nature of these items. In addition, the interest rate on the senior unsecured revolving credit facility adjusts frequently based on current market interest rates; accordingly, the Company believes the carrying amount approximates fair value.

The fair values of the Company's senior unsecured notes are classified as Level 2 because the significant inputs are observable in an active market. Refer to Note 5 for further information on debt. As of September 30, 2023 and December 31, 2022, the carrying amounts and the fair values were as follows:

	September 30, 2023				December 31, 2022
(in thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
2020 Senior Notes	$	445,537	$	374,882	$	445,080	$	384,647
2019 Senior Notes	396,290		345,196		395,838		349,368

The fair value estimates are made at a specific point in time, are subjective in nature, and involve uncertainties and matters of significant judgment. The settlement of such fair value amounts may not be possible or a prudent management decision.

8. Income Taxes

The effective income tax rates were 24.1% and 24.6% for the three months ended September 30, 2023 and 2022, respectively. The effective income tax rates were 23.8% and 24.5% for the nine months ended September 30, 2023 and 2022, respectively.

The effective income tax rates for the three and nine months ended September 30, 2023 and 2022 were higher than the U.S. federal income tax rate of 21% primarily due to the impact of state income taxes.

9.    Share-Based Compensation and Capital Stock

The components of the Company’s share-based compensation expense for the three and nine months ended September 30, 2023 and 2022 were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2023		2022		2023		2022
Stock options	$	1,422	$	1,216	$	4,562	$	3,445
Restricted stock awards	3,305		3,763		10,362		10,364
Performance vested restricted stock units	5,261		4,887		17,041		13,051
Total share-based compensation expense	$	9,988	$	9,866	$	31,965	$	26,860

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A summary of the share-based award activity during the nine months ended September 30, 2023 is presented below:

	Stock Options				Restricted Stock			Performance Vested Restricted Stock Units
	Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Outstanding at January 1, 2023	1,010,647	$	94.97		399,099	$	128.47	437,180	$	140.05
Granted	88,733	123.62			64,216	123.95		109,786	127.82
Performance-Based Leveraging (1)	—	—			—	—		64,717	138.51
Exercised/Vested	(126,556)	57.04			(85,551)	94.82		(119,751)	145.41
Expired	—	—			—	—		—	—
Forfeited	(8,660)	126.49			(10,370)	116.26		(12,365)	134.36
Outstanding at September 30, 2023	964,164	$	102.30	5.9	367,394	$	135.87	479,567	$	136.11
Stock options exercisable at September 30, 2023	581,426	$	90.42	4.4

(1) Any revisions to the outstanding PVRSUs during the nine months ended September 30, 2023 is based on the Company's performance relative to the targeted performance conditions in the respective PVRSUs.

The fair value of the restricted stock awards and the PVRSUs with performance conditions that were granted during the nine months ended September 30, 2023 was equal to the market price of the Company’s common stock on the date of grant. The fair value of the PVRSUs with market conditions based on the Company’s total shareholder return relative to a predetermined peer group was estimated using a Monte Carlo simulation method as of the grant date. The requisite service periods for the restricted stock and PVRSUs was between 9 months and 48 months. PVRSU awards have vesting ranges between 0% and 230% of the initial units granted.

The stock options granted by the Company had an exercise price equal to the market price of the Company's common stock on the date of grant. The fair value of the options granted during the nine months ended September 30, 2023 was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions:

Risk-free interest rate	4.10		%
Expected volatility	30.90		%
Expected life of the stock option	6.0 years
Dividend yield	0.9		%
Requisite service period	4 years
Contractual life	10 years
Weighted average fair value of the stock options granted (per stock option)	$	42.59

10.    Earnings Per Share

The Company’s shares of restricted stock contain rights to receive nonforfeitable dividends and thus are participating securities requiring the computation of basic Earnings per Share ("EPS") using the two-class method. The shares of restricted stock are both potential shares of common stock and participating securities so the Company calculates diluted earnings per share by using the more dilutive of the treasury stock method or the two-class method. The calculation of EPS for the net income available to common shareholders excludes the distribution of dividends and the undistributed earnings attributable to the participating securities from the numerator. The diluted earnings weighted average shares of common stock outstanding includes stock options, PVRSUs and RSUs.

14

The computation of basic and diluted earnings per share of common stock was as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in thousands, except per share amounts)	2023		2022		2023		2022
Numerator:
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Income allocated to participating securities	(479)		(614)		(1,235)		(1,526)
Net income available to common shareholders	$	91,545	$	102,466	$	228,319	$	275,113
Denominator:
Weighted average shares of common stock outstanding – basic	50,041		54,847		50,641		55,233
Basic earnings per share	$	1.83	$	1.87	$	4.51	$	4.98
Numerator:
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Income allocated to participating securities	(479)		(614)		(1,235)		(1,526)
Net income available to common shareholders	$	91,545	$	102,466	$	228,319	$	275,113
Denominator:
Weighted average shares of common stock outstanding – basic	50,041		54,847		50,641		55,233
Dilutive effect of stock options, PVRSUs, and RSUs	430		395		413		520
Weighted average shares of common stock outstanding – diluted	50,471		55,242		51,054		55,753
Diluted earnings per share	$	1.81	$	1.85	$	4.47	$	4.93

The following securities have been excluded from the calculation of diluted weighted average shares of common stock outstanding because the inclusion of these securities would have an anti-dilutive effect:

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(in thousands)	2023	2022	2023	2022
Stock options	150	170	233	154
PVRSUs	—	75	—	75

11.    Reportable Segment Information

The Hotel Franchising & Management reportable segment includes the Company's hotel franchising operations consisting of its 22 brands and brand extensions and hotel management operations of 13 Radisson Hotels Americas hotels (inclusive of 3 owned hotels). The 22 brands and brand extensions and the hotel management operations are aggregated together within this reportable segment because of their 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, procurement services revenue, 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 and management revenues and are offset by the related expenses in order to calculate hotel franchising and 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 results of the segment without allocating corporate expenses, indirect general and administrative expenses, interest expense, interest income, other gains and losses, and income taxes, all of which are included in the Corporate & Other column. Corporate & Other revenues include owned hotel revenues and the revenues related to the Company's SaaS technology solutions division which provides cloud-based property management software to non-franchised hotel properties.

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).

15

Our President and Chief Executive Officer, who is our chief operating decision maker, does not use assets by operating segment when assessing performance or when making operating segment resource allocation decisions and therefore, assets by segment are not disclosed below.

The following table presents the financial information for the Company's segments:

	Three Months Ended September 30, 2023								Three Months Ended September 30, 2022
(in thousands)	Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated		Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated
Revenues	$	395,742	$	33,832	$	(4,017)	$	425,557	$	386,124	$	29,692	$	(1,550)	$	414,266
Operating income (loss)	$	167,459	$	(32,417)	$	—	$	135,042	$	161,084	$	(16,066)	$	—	$	145,018
Income (loss) before income taxes	$	169,260	$	(48,031)	$	—	$	121,229	$	162,162	$	(25,386)	$	—	$	136,776
	Nine Months Ended September 30, 2023								Nine Months Ended September 30, 2022
(in thousands)	Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated		Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated
Revenues	$	1,106,643	$	86,464	$	(7,338)	$	1,185,769	$	980,352	$	63,363	$	(3,748)	$	1,039,967
Operating income (loss)	$	422,881	$	(85,599)	$	—	$	337,282	$	433,852	$	(32,088)	$	—	$	401,764
Income (loss) before income taxes	$	424,804	$	(123,533)	$	—	$	301,271	$	435,131	$	(68,494)	$	—	$	366,637

12.     Commitments and Contingencies

The Company is not a party to any litigation other than litigation in the ordinary course of business. The Company's management and legal counsel do not expect that the ultimate outcome of any of its currently ongoing legal proceedings, individually or collectively, will have a material adverse effect on the Company's financial position, results of operations or cash flows.

Contingencies

The Company entered into various limited payment guaranties with regards to the Company’s VIEs in order to support their efforts to develop and own hotels that are franchised under the Company’s brands. Under these limited payment guaranties, the Company has agreed to guarantee a portion of the outstanding debt until certain conditions are met, such as (a) the loan matures, (b) certain debt covenants are achieved, (c) the maximum amount guaranteed by the Company is paid in full, or (d) the Company, through its affiliates, ceases to be a member of the VIE. As of September 30, 2023, the maximum unrecorded exposure of principal incidental to these limited payment guaranties is $4.5 million, plus unpaid expenses and accrued unpaid interest. The Company believes the likelihood of having to perform under these guaranties is remote. In the event of performance, the Company has recourse for certain of the guaranties in the form of partial guaranties from third parties.

Commitments

The Company has the following outstanding commitments as of September 30, 2023:

•The Company provides financing in the form of franchise agreement acquisition payments to franchisees for property improvements, hotel development efforts and other purposes. These payments are typically made at the commencement of construction or hotel opening, in accordance with agreed upon provisions in the individual franchise agreements. As of September 30, 2023, the Company had commitments for an additional $350.3 million in franchise agreement acquisition payments, provided the conditions for the payments are met by the franchisees.

•As part of the acquisition of Radisson Hotels Americas, the Company entered into a long-term management arrangement, with an expiration date of July 31, 2031, to manage eight hotels owned by a third-party. In conjunction with the management arrangement, the Company entered into a guarantee with the third-party to fund any shortfalls in the payment of the third-party owner’s priority that is stipulated in the management agreement. The maximum guarantee under the agreement is $22 million. The Company believes the future performance of the hotels is expected to be sufficient on both an annual basis and over the duration of the agreement. Accordingly, no liability was recognized as of September 30, 2023 in the consolidated balance sheets.

16

•The Company’s legacy Choice franchise agreements require the payment of franchise fees, which include marketing and reservation system fees. In accordance with the terms of our legacy Choice franchise agreements, the Company is obligated to use the marketing and reservation system revenues it collects from the current franchisees to provide marketing and reservation services that are appropriate to support the operation of the overall system. The legacy Radisson Hotels Americas franchise agreements have similar provisions regarding the marketing fees that need to be used for marketing activities. To the extent the revenues collected exceed the expenditures incurred, the Company has a commitment to the franchisee system to make expenditures in future years. Conversely, to the extent the expenditures incurred exceed the revenues collected, the Company has the contractual enforceable right to assess and collect such amounts from the franchisees.

In the ordinary course of business, the Company enters into numerous agreements that contain standard indemnities whereby the Company indemnifies another party for breaches of representations and warranties. Such indemnifications are granted under various agreements, including those governing (i) purchases or sales of assets or businesses, (ii) leases of real estate, (iii) licensing of trademarks, (iv) access to credit facilities, (v) issuances of debt or equity securities, and (vi) certain operating agreements. The indemnifications issued are for the benefit of the (i) buyers in sale agreements and sellers in purchase agreements, (ii) landlords in lease contracts, (iii) franchisees in licensing agreements, (iv) financial institutions in credit facility arrangements, (v) underwriters in debt or equity security issuances, and (vi) parties under certain operating agreements. In addition, these parties are also generally indemnified against any third-party claim resulting from the transaction that is contemplated in the underlying agreement. While some of these indemnities extend only for the duration of the underlying agreement, many survive the expiration of the term of the agreement or extend into perpetuity (unless subject to a legal statute of limitations). There are no specific limitations on the maximum potential amount of future payments that the Company could be required to make under these indemnities, nor is the Company able to develop an estimate of the maximum potential amount of the future payments that could be made under these indemnifications as the triggering events are not subject to predictability. With respect to certain of the aforementioned indemnities, such as the indemnifications of the landlords against third-party claims for the use of real estate property leased by the Company, the Company maintains insurance coverage that mitigates potential liability.

13.     Transactions with Unconsolidated Affiliates

The Company has management fee arrangements with certain of its unconsolidated affiliates that are discussed in Note 4. The fees earned and the payroll costs reimbursed under these arrangements totaled $2.4 million and $0.8 million for the three months ended September 30, 2023 and 2022, respectively, and $6.1 million and $1.7 million for the nine months ended September 30, 2023 and 2022, respectively.

The Company has entered into franchise agreements with certain unconsolidated affiliates. Pursuant to these franchise agreements, for the three months ended September 30, 2023 and 2022, the Company recognized royalty and marketing reservation system fees of approximately $9.4 million and $8.9 million, respectively. For the nine months ended September 30, 2023 and 2022, the Company recognized royalty and marketing reservation fees of approximately $23.1 million and $19.5 million, respectively. The Company recognized $5.2 million and $3.9 million as a receivable from these affiliates as of September 30, 2023 and December 31, 2022, respectively.

14.    Acquisitions

Radisson Hotels Americas Acquisition

On August 11, 2022, the Company completed the acquisition of Radisson Hotels Americas. The accounting purchase price for the Transaction was $673.9 million, which includes the base purchase price of $675.2 million and then adjusted for Disclosed Leakage (as defined in the Share Sale and Purchase Agreement) and certain other prepaid expenses. To fund the Transaction, Choice drew down $175.0 million on the Company's existing senior unsecured credit facility and then funded the remainder with cash on hand.

In connection with the acquisition, we recognized $10.9 million and $30.6 million during the three and nine months ended September 30, 2023, respectively, and $24.9 million and $29.0 million during the three and nine months ended September 30, 2022, respectively, of transaction, transition, and severance expenses which are included within Selling, general and administrative in the consolidated statements of income.

Fair Values of the Assets Acquired and the Liabilities Assumed

The Company allocated the purchase price based upon a preliminary assessment of the fair value of the assets acquired and the liabilities assumed on August 11, 2022. During the fourth quarter of 2022 and the first quarter of 2023, the Company recorded certain net measurement period adjustments that reduced goodwill by $9.1 million and increased goodwill by $1.5 million, respectively, which is presented in the table below. The Company made these measurement period adjustments to reflect the

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facts and circumstances that existed as of the acquisition date and did not result from any intervening events subsequent to the acquisition date. The measurement period adjustments resulted in no impact to our consolidated statements of income.

The final valuation and related allocation of the purchase price was completed in the third quarter of 2023.

The final allocation of the purchase price, including all measurement period adjustments, as presented in our consolidated balance sheets is as follows:

(in thousands)	August 11, 2022 - original		Measurement Period Adj - 4th quarter 2022		Measurement Period Adj - 1st quarter 2023		August 11, 2022 - as adjusted
Cash and cash equivalents	$	113,023	$	—	$	—	$	113,023
Restricted cash	10,403		—		—		10,403
Accounts receivable	32,972		8,752		(1,941)		39,783
Notes receivable - current	1,709		—		(860)		849
Prepaid expenses and other current assets	8,139		—		—		8,139
Property and equipment	125,441		—		—		125,441
Operating lease right-of-use of assets	42,315		(2,016)		—		40,299
Intangible assets	447,400		(300)		—		447,100
Notes receivable - noncurrent	2,592		—		—		2,592
Investment in affiliates	471		—		—		471
Other assets	2,129		—		—		2,129
Total assets acquired	$	786,594	$	6,436	$	(2,801)	$	790,229
Accounts payable	$	8,295	$	(1,566)	$	(1,941)	$	4,788
Accrued expenses and other current liabilities	15,987		425		674		17,086
Deferred revenue - current(1)	5,745		1,566		—		7,311
Liability for guest loyalty program - current(1)	3,542		3,792		—		7,334
Long-term debt	55,975		—		—		55,975
Long-term deferred revenue(1)	26,499		(3,915)		—		22,584
Deferred compensation and retirement plan obligations	9,265		—		—		9,265
Operating lease liabilities	42,705		(2,016)		—		40,689
Liability for guest loyalty program - noncurrent(1)	10,180		(1,443)		—		8,737
Other liabilities	3,052		543		—		3,595
Total liabilities assumed	$	181,245	$	(2,614)	$	(1,267)	$	177,364
Fair value of net assets acquired	$	605,349	$	9,050	$	(1,534)	$	612,865
Goodwill	68,507		(9,050)		1,534		60,991
Total purchase consideration	$	673,856	$	—	$	—	$	673,856

(1) The Deferred revenue (including deferred affiliation fees) and Liability for guest loyalty program balances were assumed at their carrying value on the date of the acquisition pursuant to the application of ASU 2021-08. Refer to Note 1

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Property and Equipment

The following table presents the estimated fair value of the acquired property and equipment, which is primarily concentrated at three acquired hotel properties, and their estimated weighted average remaining useful lives.

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Land	N/A	$	7,159
Construction in progress	N/A	3,190
Building and leasehold improvements	24.4	93,934
Site improvements	23.1	586
Furniture, fixtures and equipment	3.9	8,334
Computer equipment and software	2.0	12,238
Total property and equipment		$	125,441

We estimated the value of the property and equipment through a combination of income, cost and market approaches, which are primarily based on significant Level 2 and Level 3 assumptions, such as estimates of future income growth, discount rates, capitalization rates and capital expenditure needs of the hotel properties.

Identified Intangible Assets

The following table presents the estimated fair values of the acquired identified intangible assets and their estimated useful lives:

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Trade names	N/A	$	223,700
Franchise agreements	15.5	220,100
Management agreements	15.5	3,300
Total intangible assets		$	447,100

The fair value of the trade names was estimated using the relief-from-royalty method. This method applies an estimated royalty rate to the forecasted future cash flows and discounted to the present value. The fair value of the franchise and management agreements was estimated using a multi-period excess earnings method, which is a variation of the income approach. This method uses the present value of the incremental after-tax cash flows attributable to the intangible asset. These valuation methodologies utilize Level 3 assumptions.

Debt Assumed

As part of the Transaction, we assumed a mortgage loan related to an acquired hotel property. The mortgage loan had an associated interest rate cap agreement with an effective date of July 30, 2021 through August 6, 2024. Subsequent to the acquisition date, the mortgage loan and the outstanding interest and fees, was repaid in full in the amount of $56.0 million using cash we acquired in the Transaction. Additionally, the interest rate cap agreement was terminated, which resulted in a $1.9 million payment to Choice. In conjunction with assuming the mortgage loan, we acquired $10.4 million in restricted cash, for which the restrictions were lifted upon repayment of the mortgage loan.

Operating Leases

The Company measured the assumed operating lease liabilities at the present value of the remaining payments as of the acquisition date, which were discounted using Choice's applicable incremental borrowing rate in accordance with Leases (Topic 842). The corresponding acquired right-of-use assets were measured at the value of the operating lease liabilities, and then further adjusted for favorable or unfavorable lease terms as compared to market lease terms.

Income Taxes

Pursuant to the terms of the Transaction, the parties agree to jointly make a valid, timely election under Section 338(h)(10) of the U.S. Internal Revenue Code and under any similar provisions of state or local law with respect to the purchase of the shares of Radisson Hotels Americas. Under this election, the parties agreed to treat the Transaction for federal income tax purposes as if it had been structured as an asset sale and purchase. As a result of this election, the tax basis of the assets acquired and the liabilities assumed by Choice were reset to fair value on the date of the acquisition, which results in the elimination of any

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previously established deferred income tax balances and the establishment of new balances that reflect the new tax basis, including tax deductible goodwill.

Pro Forma Results of Operations

The following unaudited pro forma information presents the combined results of operations of Choice and Radisson Hotels Americas as if the Transaction was completed on January 1, 2021, but using the fair values of the assets acquired and the liabilities assumed as of the acquisition date. The unaudited pro forma information reflects adjustments relating to (i) the allocation of purchase price and related adjustments, including incremental depreciation and amortization expense based on the fair values of the acquired property and equipment and intangible assets, (ii) the incremental impact of the Revolver draw on interest expense and the amortization of financing costs, (iii) nonrecurring transaction costs, and (iv) the income tax impact of the aforementioned pro forma adjustments.

As required by GAAP, these unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the transaction had occurred at the beginning of the period presented, nor are they indicative of the future results of operations.

	Nine Months Ended
(in thousands)	September 30, 2022
Revenues	$	1,189,792
Net income	$	304,770

Radisson Hotels Americas Results of Operations

The Company's consolidated statements of income include Radisson Hotels Americas’ results of operations since the August 11, 2022 acquisition date. Radisson Hotels Americas contributed $40.2 million and $1.4 million in total revenues and net loss, respectively, for both the three and nine months ended September 30, 2022.

Goodwill

The $61.0 million of goodwill is primarily attributable to the value we expect to realize from the existing customer base, improvements in Revenue per Available Room ("RevPAR"), cost synergies, and new agreements signed with franchisees and developers. Goodwill for the Transaction is fully attributable to the Hotel Franchising & Management reportable segment and is fully deductible for tax purposes.

The following table details the carrying amount of the Company's goodwill, including the goodwill arising from the acquisition of Radisson Hotels Americas, as of September 30, 2023.

(in thousands)
Goodwill, excluding goodwill arising from Radisson Hotels Americas acquisition	$	166,774
Accumulated impairment losses	(7,578)
Goodwill arising from Radisson Hotels Americas acquisition	60,991
Goodwill, net carrying amount	$	220,187

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help the reader understand the consolidated financial condition and the results of operations of Choice Hotels International, Inc. and its subsidiaries (collectively "Choice" or the "Company", "we", "us", or "our") contained in this report. MD&A is provided as a supplement to — and should be read in conjunction with — our consolidated financial statements and the accompanying notes.

Overview

We are primarily a hotel franchisor operating in 50 states, the District of Columbia and over 45 countries and territories. At September 30, 2023, we had 7,463 hotels with 627,694 rooms open and operating, and 980 hotels with 99,076 rooms under construction, awaiting conversion, approved for development or committed to future franchise development on outstanding master development agreements (collectively, "pipeline") in its global system. Our brand names include Comfort Inn®, Comfort Suites®, Quality®, Clarion®, Clarion Pointe™, Ascend Hotel Collection®, Sleep Inn®, Econo Lodge®, Rodeway Inn®, MainStay Suites®, Suburban Studios™, WoodSpring Suites®, Everhome Suites®, and Cambria® Hotels (collectively, the "legacy Choice brands"). Additionally, through the Radisson Hotels Americas acquisition completed on August 11, 2022, our brands expanded to include Radisson Blu®, Radisson RED®, Radisson®, Park Plaza®, Country Inn & Suites® by Radisson, Radisson Inn & SuitesSM, Park Inn by Radisson®, Radisson Individuals®, and Radisson Collection® (collectively, the "legacy Radisson brands"), which are located across the United States, Canada, the Caribbean and Latin America.

The hotel franchising business represents the Company's primary operations. The Company's domestic operations are conducted through direct franchising relationships, the ownership of six Cambria and three legacy Radisson Hotels Americas open and operating hotels, and the management of 13 legacy Radisson Hotels Americas hotels (inclusive of the Radisson Hotels Americas owned hotels), while its international franchise operations are conducted through a combination of direct franchising and master franchising relationships. Master franchising relationships are governed by master franchising agreements which generally provide the master franchisee with the right to use our brands and sub-license the use of our brands in a specific geographic region, usually for a fee. As a result of our master franchise relationships and international market conditions, our revenues are primarily concentrated in the United States. Therefore, our description of our business is primarily focused on the domestic operations, which encompasses the United States.

Our Company generates revenues, income and cash flows primarily from our hotel franchising operations. Revenues are also generated from partnerships with qualified vendors and travel partners that provide value-added solutions to our platform of guests and hotels; hotel ownership; and other ancillary sources. Historically, the hotel industry has been seasonal in nature. For most hotels, demand is typically lower in November through February than during the remainder of the year. Our principal source of revenue is franchise fees, which is based on the gross room revenues or the number of rooms at our franchised properties. The Company’s franchise and managed fees, as well as its owned hotels' revenues, normally reflect the industry’s seasonality and historically have been lower in the first and fourth quarters than in the second and third quarters of the year.

The Company's primary focus is hotel franchising, so we benefit from the economies of scale inherent in the franchising business. The fee and cost structure of our franchising business provides opportunities to improve our operating results by increasing the number of franchised hotel rooms and the effective royalty rates in our franchise contracts resulting in increased initial fee revenue, ongoing royalty fees, procurement services and licensing revenues. In addition, our operating results can also be improved through our company-wide efforts related to improving property-level performance and expanding the number of partnerships with travel-related and other companies with products and services that appeal to our guests.

The primary factors that affect the Company’s results are: the number and relative mix of hotel rooms in the various hotel lodging price categories; growth in the number of hotel rooms owned and under franchise; occupancy and room rates achieved by the hotels in our system; the effective royalty rate achieved in our franchise agreements; the level of franchise sales and relicensing activity; the number of qualified vendor arrangements and partnerships and the level of engagement with these partners by our franchisees and guests; and our ability to manage costs. The number of rooms in our hotel system and the occupancy and room rates at those hotel properties significantly affect the Company’s results because our fees are based upon room revenues or the number of rooms at owned and franchised hotels. The key industry standard for measuring hotel-operating performance is Revenue per Available Room ("RevPAR"), which is calculated by multiplying the percentage of occupied rooms by the average daily room rate realized. Our variable overhead costs associated with the franchise system growth of our established brands have historically been less than the incremental royalty fees generated from new franchises. Accordingly, over the long-term, the continued growth of our franchise business should enable us to realize the benefits from the operating leverage in place and improve our operating results.

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We are required by our legacy Choice franchise agreements to use the marketing and reservation system fees we collect for system-wide marketing and reservation system activities. These expenditures, which include advertising costs and costs to maintain our central reservations systems, enhance awareness and consumer preference for our brands and deliver guests to our franchisees. Greater awareness and preference promotes long-term growth in business delivery to our franchisees and increases the desirability of our brands to hotel owners and developers, which ultimately increases the franchise fees earned by the Company. The legacy Radisson Hotels Americas franchise agreements have similar provisions that require the marketing fees to be used for marketing activities. Additionally, the legacy Radisson Hotels Americas management agreements include cost reimbursements, primarily related to payroll costs at managed hotels where the Company is the employer.

Our Company articulates its mission as a commitment to our franchisees’ profitability by providing our franchisees with hotel franchises that strive to generate the highest return on investment of any hotel franchise. We have developed an operating system dedicated to our franchisees’ success that focuses on delivering guests to their hotels and reducing hotel operating costs.

We believe that executing on our strategic priorities creates value for our shareholders. Our Company focuses on the following strategic priorities:

Profitable Growth - Our success is dependent on improving the performance of our hotels, increasing the size of our system by selling additional hotel franchises with a focus on revenue-intense chain scales and markets, improving our effective royalty rate, expanding our qualified vendor and partnership platform programs and maintaining a disciplined cost structure. We attempt to improve our revenues and overall profitability by providing a variety of products and services designed to increase business delivery and/or reduce operating and development costs. These products and services include national marketing campaigns, a guest loyalty program, a central reservation system, property and yield management programs and systems, revenue management services, quality assurance standards, and qualified vendor relationships and partnerships with companies that provide products and services to our franchisees and guests. We believe that healthy brands, which deliver a compelling return on investment, will enable us to sell additional hotel franchises and raise royalty rates. We have multiple brands that meet the needs of many different types of guests, and can be developed at various price points and applied to both new and existing hotels. This ensures that we have brands suitable for creating growth in a variety of market conditions. Improving the performance of the hotels in our system, strategically growing the system through additional franchise sales, and improving franchise agreement pricing while maintaining a disciplined cost structure are the keys to profitable growth. The addition of the legacy Radisson brands in the Americas increased Choice's footprint in the upper midscale and upscale chain scales and established Choice's presence in the upper upscale chain scale. We believe the Radisson Hotels Americas acquisition has enabled us to strengthen our presence in the upper midscale chain scale, expand our market presence in certain geographies in the United States, and further build on our momentum in the upscale chain scale which will facilitate the continued growth of our Cambria Hotels and Ascend Hotel Collection brands and the further expansion of the Radisson portfolio.

Maximizing Financial Returns and Creating Value for Shareholders - Our capital allocation decisions, including capital structure and uses of capital, are intended to maximize our return on invested capital and create value for our shareholders. Since our business has not historically required significant reinvestment of capital, we typically utilize cash in ways that management believes provides the greatest returns to our shareholders, which include acquisitions, share repurchases and dividends. Refer to the Liquidity and Capital Resources section of MD&A for more information regarding our capital returns to shareholders.

In addition to our hotel franchising business, we have also developed or acquired six Cambria and three legacy Radisson Hotels Americas open and operating hotels. We intend to continue to strategically develop hotels to increase the presence of our newly introduced brands in the United States, drive greater guest satisfaction and brand preference, and ultimately increase the number of franchise agreements awarded. When developing hotels, we seek key markets with strong growth potential that will deliver strong operating performance and improve the recognition of our brands. Our hotel development and ownership efforts currently focus on the Cambria Hotels and Everhome Suites brands. We believe our owned hotels provide us the opportunity to support and accelerate the growth of these brands. We do not anticipate owning hotels on a permanent basis and we expect to target dispositions to a franchisee encumbered with a long-term Choice franchise agreement in the future.

The Company also allocates capital to financing, investment and guaranty support to incentivize franchise development for certain brands in strategic markets. The timing and amount of these investments are subject to market and other conditions.

We believe our growth investments and strategic priorities, when properly implemented, will enhance our profitability, maximize our financial returns and continue to generate value for our shareholders. The ultimate measure of our success will be reflected in the items below.

Results of Operations - Royalty fees, licensing and management fees, operating income, net income and diluted earnings per share ("EPS") represent the key measures of our financial performance. These measures are primarily driven by the operations

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of our hotel franchise system and, therefore, our analysis of the Company's operations is primarily focused on the size, performance and potential growth of the hotel franchise system as well as our variable overhead costs.

Our discussion of our results of operations generally excludes the Company’s other revenues and other expenses from franchised and managed properties, which reflect franchise marketing and reservation system revenues and expenses and management agreement cost reimbursements and expenses. The Company's legacy Choice franchise agreements require the payment of marketing and reservation system fees to be used exclusively by the Company for the expenses associated with providing franchise services such as national marketing, media advertising, and central reservation systems. The Company is obligated to expend the marketing and reservation system fees it collects from its franchisees in accordance with the franchise agreements. Furthermore, the franchisees are required to reimburse the Company for any deficits generated by these marketing and reservation system activities. Over time, the Company expects the cumulative revenues and expenses to break even and, therefore, no income or loss will be generated from the marketing and reservation system activities. The franchise and management contracts acquired in the Radisson Hotels Americas acquisition have similar terms as those described above with the exception of certain contractual elements concerning reservation fees, which are not required to break-even over time and are insignificant to the Company's operating income and net income. As a result, the Company generally excludes the other revenues and other expenses from franchised and managed properties from the analysis of its operations.

Due to the seasonal nature of the Company’s hotel franchising and management business and the multi-year investments required to support franchise operations, quarterly and/or annual deficits may be generated. During the three months ended September 30, 2023 and 2022, other revenues from franchised and managed properties exceeded other expenses from franchised and managed properties by $10.3 million and $6.9 million, respectively. During the nine months ended September 30, 2023 and 2022, other revenues from franchised and managed properties exceeded other expenses from franchised and managed properties by $19.5 million and $55.4 million, respectively.

Refer to the Operations Review section of MD&A for additional analysis of our results.

Liquidity and Capital Resources - Historically, the Company has generated significant cash flows from operations. Since our business has not historically required significant reinvestment of capital, we typically utilize cash in ways that management believes provide the greatest returns to our shareholders, which include acquisitions, share repurchases and dividends.

We believe the Company’s cash on hand, available borrowing capacity under the senior unsecured revolving credit facility, cash flows from operations, and access to additional capital in the debt markets is sufficient to meet the expected future operating, investing and financing needs of the business. Refer to the Liquidity and Capital Resources section of MD&A for additional analysis.

Inflation - We believe that moderate increases in the rate of inflation will generally result in comparable or greater increases in hotel room rates. We continue to monitor future inflation trends along with the corresponding impacts to our business.

Wyndham Proposal

As previously disclosed, the Company publicly announced a proposal to acquire all of the outstanding shares of Wyndham Hotels & Resorts, Inc. ("Wyndham") at a price of $90.00 per share, payable in a mix of cash and stock. Although Wyndham has publicly rejected the proposal, the Company continues to believe the proposal will benefit shareholders of both companies and has encouraged Wyndham to engage in further discussions. There can be no assurance that any transaction will result from our proposal.

Non-GAAP Financial Statement Measures

The Company utilizes certain measures which do not conform to generally accepted accounting principles accepted in the United States ("GAAP") when analyzing and discussing its results with the investment community. This information should not be considered as an alternative to any measure of performance as promulgated under GAAP. The Company’s calculation of these measures may be different from the calculations used by other companies and therefore, comparability may be limited. We have included a reconciliation of these measures to the comparable GAAP measure below as well as our reasons for reporting these non-GAAP measures.

Revenues excluding reimbursable revenue from franchised and managed properties and extraordinary termination fees from franchisee. The Company’s other revenues from franchised and managed properties financial statement line item reflects franchise marketing and reservation system revenues and management agreement cost reimbursements. The legacy Choice franchise marketing and reservation activities and the legacy Radisson Hotels Americas franchise marketing activities and management agreement cost reimbursements operate at break-even based on the Company's contractual commitments regarding the manner such fees will be utilized. The legacy Radisson Hotels Americas reservation revenue, which is also recorded in other

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revenues from franchised and managed properties, does not break-even, based on the legacy Radisson Hotels Americas franchise contracts.

Additionally, the Company recognized $22.7 million in termination fees in the other revenues financial statement line item as a result of the exit of 110 WoodSpring units in the third quarter of 2022.

The Company excludes reimbursable revenue from franchised and managed properties and the extraordinary termination fees from franchisee when analyzing the performance of the business.

A similar non-GAAP measure is a commonly used measure of performance in our industry and facilitates comparisons between the Company and its competitors.

Calculation of Revenues excluding reimbursable revenue from franchised and managed properties and extraordinary termination fees from franchisee

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2023		2022		2023		2022
Total revenues	$	425,557	$	414,266	$	1,185,769	$	1,039,967
Adjustments:
Reimbursable revenue from franchised and managed properties	(205,965)		(190,627)		(563,391)		(506,646)
Extraordinary termination fees from franchisee	—		(22,647)		—		(22,647)
Revenues excluding reimbursable revenue from franchised and managed properties and extraordinary termination fees from franchisee	$	219,592	$	200,992	$	622,378	$	510,674

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Operations Review

A comparison of the financial results for the three and nine months ended September 30, 2023 and 2022 is set forth in the sections below. In accordance with GAAP, our consolidated statements of income include Radisson Hotels Americas’ results of operations in the three and nine months ended September 30, 2023, but our income statements only partially include Radisson Hotels Americas' results of operations in the three and nine months ended September 30, 2022 because we did not acquire Radisson Hotels America until August 11, 2022.

Comparison of Operating Results for the Three Month Periods Ended September 30, 2023 and 2022

	Three Months Ended
	September 30,
(in thousands)	2023		2022
REVENUES
Royalty, licensing and management fees	$	148,512	$	144,020
Initial franchise fees	6,194		7,011
Platform and procurement services fees	15,542		14,401
Owned hotels	26,239		19,992
Other	11,436		31,432
Other revenues from franchised and managed properties	217,634		197,410
Total revenues	425,557		414,266
OPERATING EXPENSES
Selling, general and administrative	54,913		70,202
Depreciation and amortization	9,633		8,726
Owned hotels	18,628		13,158
Other expenses from franchised and managed properties	207,341		190,541
Total operating expenses	290,515		282,627
Gain on sale of business and assets, net	—		13,379
Operating income	135,042		145,018
OTHER INCOME AND EXPENSES, NET
Interest expense	16,168		9,362
Interest income	(1,897)		(2,348)
Other loss (gain)	1,343		2,303
Equity in net gain of affiliates	(1,801)		(1,075)
Total other income and expenses, net	13,813		8,242
Income before income taxes	121,229		136,776
Income tax expense	29,205		33,696
Net income	$	92,024	$	103,080

Results of Operations

The Company recognized income before income taxes of $121.2 million for the three month period ended September 30, 2023, which is a $15.6 million decrease from the same period in the prior year. The decrease in income before income taxes is primarily due to a $10.0 million decrease in operating income and a $6.8 million increase in interest expense.

Operating income decreased $10.0 million primarily due to $22.7 million of termination fees in other revenues from the exit of 110 WoodSpring units in September 2022 and a $13.4 million net gain on sale of business and assets that were recognized during the third quarter of 2022. The decreases to operating income were partially offset by a $9.8 million reduction in transition costs in selling, general and administrative ("SG&A") expenses related to the integration of the Radisson Hotels Americas business, a $4.0 million decrease in SG&A expenses related to operational restructuring charges consisting primarily of salary and benefit continuation payments, a $3.4 million increase in the net surplus generated from the other franchised and managed properties activity, and the growth of the legacy Choice business and the operations of the acquired Radisson Hotels Americas business.

The primary reasons for these fluctuations, inclusive of the impact from the legacy Radisson brands, are described in more detail below.

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Royalty, licensing and management fees

Domestic royalty fees decreased $1.2 million to $132.2 million for the three months ended September 30, 2023 from $133.4 million for the three months ended September 30, 2022 which was primarily due to the exit of 110 WoodSpring units in September 2022 and a domestic system-wide RevPAR decrease of 0.8% due to a 130 basis point decrease in occupancy, partially offset by a 1.3% increase in average daily rates. The decrease in domestic royalty fees was partially offset by higher royalty fees in the comparative period for the legacy Radisson brands and a system-wide 6 basis point increase in the effective royalty rate from 4.93% for the three months ended September 30, 2022 to 4.99% for the three months ended September 30, 2023.

A summary of the operating performance for the Company's domestic franchised hotels organized by chain scale is as follows.

	Three Months Ended						Three Months Ended						Change
	September 30, 2023						September 30, 2022
	Average Daily Rate		Occupancy		RevPAR		Average Daily Rate		Occupancy		RevPAR		Average Daily Rate		Occupancy		RevPAR
Upscale & Above(1)	$	160.49	63.1	%	$	101.29	$	157.10	62.4	%	$	98.09	2.2	%	70	bps	3.3	%
Midscale & Upper Midscale(2)	107.77		62.2	%	67.07		107.49		63.1	%	67.88		0.3	%	(90)	bps	(1.2)	%
Extended Stay(3)	64.64		74.5	%	48.18		63.83		77.5	%	49.46		1.3	%	(300)	bps	(2.6)	%
Economy(4)	77.00		51.6	%	39.74		77.51		54.5	%	42.25		(0.7)	%	(290)	bps	(5.9)	%
Total(5)	$	103.33	62.0	%	$	64.02	$	101.99	63.3	%	$	64.53	1.3	%	(130)	bps	(0.8)	%

(1) Includes Cambria, Ascend, Radisson Blu, Radisson Red, Park Plaza, Radisson Individuals and Radisson brands.

(2) Includes Country, Comfort, Clarion, Sleep, Quality and Park brands.

(3) Includes WoodSpring, Mainstay, Suburban and Everhome brands.

(4) Includes Econo Lodge and Rodeway brands.

(5) Radisson Hotels Americas was acquired on August 11, 2022. To enhance comparability, ADR, Occupancy, and RevPAR reflect the operating performance for the three months ended September 30, 2022 as if the legacy Radisson brands were acquired on January 1, 2022.

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A summary of the domestic hotels and rooms by brand in our franchise system at September 30, 2023 and 2022 is as follows:

	September 30, 2023		September 30, 2022		Variance
	Hotels	Rooms	Hotels	Rooms	Hotels	Rooms	%		%
Ascend Hotel Collection	231	24,955	192	20,069	39	4,886	20.3	%	24.3	%
Cambria Hotels	69	9,398	61	8,433	8	965	13.1	%	11.4	%
Radisson(1)	66	15,499	77	17,643	(11)	(2,144)	(14.3)	%	(12.2)	%
Comfort(2)	1,660	130,380	1,668	131,140	(8)	(760)	(0.5)	%	(0.6)	%
Country(3)	426	33,928	439	35,179	(13)	(1,251)	(3.0)	%	(3.6)	%
Clarion(4)	177	19,327	185	20,642	(8)	(1,315)	(4.3)	%	(6.4)	%
Quality	1,611	118,874	1,625	120,708	(14)	(1,834)	(0.9)	%	(1.5)	%
Sleep	425	30,005	423	29,770	2	235	0.5	%	0.8	%
Park	4	363	4	363	0	0	—	%	—	%
Everhome	1	98	1	98	0	0	—	%	—	%
MainStay	123	8,471	113	7,843	10	628	8.8	%	8.0	%
WoodSpring(5)	231	27,862	206	24,890	25	2,972	12.1	%	11.9	%
Suburban	90	7,888	73	6,565	17	1,323	23.3	%	20.2	%
Econo Lodge	671	39,429	704	42,323	(33)	(2,894)	(4.7)	%	(6.8)	%
Rodeway	471	26,557	491	27,569	(20)	(1,012)	(4.1)	%	(3.7)	%
Total Domestic Franchises	6,256	493,034	6,262	493,235	(6)	(201)	(0.1)	%	—	%

(1) Includes Radisson Blu, Radisson Red, Radisson Individuals and Radisson brands.

(2) Includes Comfort family of brand extensions including Comfort and Comfort Suites.

(3) Includes Country Inn & Suites, Park Plaza, and Radisson Inn brands.

(4) Includes Clarion family of brand extensions including Clarion and Clarion Pointe.

(5) In July 2022, the Company received notice from an ownership group of its intent to exit 110 WoodSpring properties from the Choice system, which occurred in September 2022.

International royalty fees increased $1.7 million to $7.9 million for the three months ended September 30, 2023 from $6.2 million three months ended September 30, 2022. The increase in international royalty fees is attributable to higher royalty fees for the legacy Radisson brands, improvements in RevPAR performance, and an increase in the international franchise system size by 11 hotels (from 1,196 as of September 30, 2022 to 1,207 as of September 30, 2023) and 713 rooms (from 133,947 as of September 30, 2022 to 134,660 as of September 30, 2023).

Initial franchise fees

Initial franchise fee revenue decreased $0.8 million from $7.0 million to $6.2 million for the three months ended September 30, 2022 and September 30, 2023, respectively. The decrease is primarily attributable to the quantity of domestic franchise agreement terminations as compared to the prior year.

Initial franchise fees are generally paid to the Company when a franchisee executes a franchise agreement for a new property entering the system or an existing franchised property at the time of an ownership change (referred to as a relicensing) or agreement renewal, however, the recognition of revenue is deferred until the hotel associated with the franchise agreement is open or the franchise agreement is terminated. Upon hotel opening, revenue is recognized ratably as services are provided over the enforceable period of the franchise license agreement. Upon the termination of a franchise agreement, previously deferred initial franchise fees are recognized immediately in the period the agreement is terminated.

At September 30, 2023, the Company had 980 hotels with 99,076 rooms in its global pipeline. Approximately 90% of our pipeline is located in the United States and approximately 73% of the domestic pipeline is new construction. After the execution of a franchise agreement, new construction hotels typically average 18 to 36 months to open, while conversion hotels typically average three to six months to open.

Fluctuations in the Company’s pipeline are primarily due to the timing of hotel openings and the timing of awarding new franchise agreements. While the Company's pipeline provides a strong platform for growth, a hotel in the pipeline does not always result in an open and operating hotel due to various macroeconomic factors, including access to liquidity, availability of construction labor and materials, and local governmental approvals and entitlements.

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Selling, general and administrative

SG&A expenses, which includes the cost to operate the business, decreased $15.3 million from $70.2 million for the three months ended September 30, 2022 to $54.9 million for the three months ended September 30, 2023.

SG&A expenses decreased $4.0 million related to operational restructuring charges that consisted primarily of salary and benefit continuation payments and $9.8 million related to transition costs associated with the integration of the Radisson Hotels Americas business.

SG&A expenses also includes a contra expense attributable to a decrease in the Company's deferred compensation liabilities based on decreases in the fair value of the underlying investments. The current period activity represents a $0.5 million increase in SG&A expense relative to the comparable period of the prior year.

Depreciation and amortization

Depreciation and amortization expense was $9.6 million and $8.7 million for the three months ended September 30, 2023 and 2022, respectively. Depreciation and amortization expense increased primarily due to the acquisition of Radisson Hotels Americas and the associated amortization from the portion of the purchase price that was allocated to contract asset acquisition costs as well as the three hotel properties acquired in the transaction.

Interest expense

The Company recognized $16.2 million of interest expense for the three months ended September 30, 2023, which was an increase of $6.8 million from the comparable period in 2022. The increase in interest expense is a result of increased borrowings and higher interest rates on the Company's revolving credit facility. Refer to the discussion under the Liquidity and Capital Resources section of MD&A.

Other loss (gain)

The Company recognized other net loss of $1.3 million and $2.3 million for the three months ended September 30, 2023 and 2022, respectively. The losses relate to decreases in the Company's deferred compensation assets based on decreases in the fair value of the underlying investments and foreign currency transaction losses.

Income tax expense

The effective income tax rates were 24.1% and 24.6% for the three months ended September 30, 2023 and 2022, respectively. The effective income tax rates for the three months ended September 30, 2023 and 2022 were higher than the U.S. federal income tax rate of 21.0% primarily due to the impact of state income taxes.

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Comparison of Operating Results for the Nine Month Periods Ended September 30, 2023 and 2022

	Nine Months Ended
	September 30,
(in thousands)	2023		2022
REVENUES
Royalty, licensing and management fees	$	396,503	$	356,208
Initial franchise fees	21,240		21,635
Platform and procurement services fees	58,186		47,887
Owned hotels	74,075		49,220
Other	33,211		51,588
Other revenues from franchised and managed properties	602,554		513,429
Total revenues	1,185,769		1,039,967
OPERATING EXPENSES
Selling, general and administrative	182,000		144,414
Depreciation and amortization	29,468		20,436
Owned hotels	53,924		32,004
Other expenses from franchised and managed properties	583,095		458,037
Total operating expenses	848,487		654,891
Gain on sale of business and assets, net	—		16,688
Operating income	337,282		401,764
OTHER INCOME AND EXPENSES, NET
Interest expense	46,522		32,084
Interest income	(5,836)		(5,256)
Other loss (gain)	(2,752)		9,578
Equity in net gain of affiliates	(1,923)		(1,279)
Total other income and expenses, net	36,011		35,127
Income before income taxes	301,271		366,637
Income tax expense	71,717		89,998
Net income	$	229,554	$	276,639

Results of Operations

The Company recognized income before income taxes of $301.3 million for the nine month period ended September 30, 2023, which is a $65.3 million decrease from the same period in the prior year. The decrease in income before income taxes is primarily due to a $64.5 million decrease in operating income.

Operating income decreased $64.5 million primarily due to a $35.9 million decrease in the net surplus generated from the other franchised and managed properties activity, $22.7 million of termination fees in other revenues from the exit of 110 WoodSpring units in September 2022, and $16.7 million of net gains on sale of business and assets that were recognized during the nine month period September 30, 2022. In addition, SG&A expenses increased $10.9 million related to increases in the Company's deferred compensation liabilities based on increases in the fair value of the underlying investments. Depreciation and amortization expense also increased $9.1 million due to the acquisition of three hotel properties and identifiable intangible assets as part of the Radisson Hotels Americas transaction. The decreases to operating income were partially offset by the growth of the legacy Choice business and the operations of the acquired Radisson Hotels Americas business.

The primary reasons for these fluctuations, inclusive of the impact from the acquired legacy Radisson brands, are described in more detail below.

Royalty fees, licensing and management fees

Domestic royalty fees increased $18.4 million to $355.4 million for the nine months ended September 30, 2023 from $337.1 million for the nine months ended September 30, 2022.

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The increase in domestic royalty fees is attributable to higher royalty fees from the legacy Radisson brands, a system-wide 6 basis point increase in the effective royalty rate from 4.93% during the nine months ended September 30, 2022 to 4.99% during the nine months ended September 30, 2023, and a domestic system-wide RevPAR increase of 1.4% due to a 3.0% increase in average daily rates, partially offset by a 100 basis point decrease in occupancy.

A summary of the operating performance for the Company's domestic franchised hotels organized by chain scale is as follows.

	Nine Months Ended						Nine Months Ended						Change
	September 30, 2023						September 30, 2022
	Average Daily Rate		Occupancy		RevPAR		Average Daily Rate		Occupancy		RevPAR		Average Daily Rate		Occupancy		RevPAR
Upscale & Above(1)	$	152.58	58.2	%	$	88.86	$	146.91	56.7	%	$	83.26	3.9	%	150	bps	6.7	%
Midscale & Upper Midscale(2)	102.91		58.3	%	60.02		101.47		58.7	%	59.52		1.4	%	(40)	bps	0.8	%
Extended Stay(3)	64.26		73.5	%	47.23		61.85		76.9	%	47.58		3.9	%	(340)	bps	(0.7)	%
Economy(4)	72.66		49.0	%	35.57		72.44		51.1	%	36.99		0.3	%	(210)	bps	(3.8)	%
Total(5)	$	98.60	58.3	%	$	57.52	$	95.75	59.3	%	$	56.74	3.0	%	(100)	bps	1.4	%

(1) Includes Cambria, Ascend, Radisson Blu, Radisson Red, Park Plaza, Radisson Individuals and Radisson brands.

(2) Includes Country, Comfort, Clarion, Sleep, Quality and Park brands.

(3) Includes WoodSpring, Mainstay, Suburban and Everhome brands.

(4) Includes Econo Lodge and Rodeway brands.

(5) Radisson Hotels Americas was acquired on August 11, 2022. To enhance comparability, ADR, Occupancy, and RevPAR reflect the operating performance for the nine months ended September 30, 2022 as if the legacy Radisson brands were acquired on January 1, 2022.

International royalty fees increased $7.0 million to $21.8 million during the nine months ended September 30, 2023 as compared to the nine months ended September 30, 2022. The increase in international royalty fees is attributable to higher royalty fees from the legacy Radisson brands, improvements in RevPAR performance, and an increase in the size of the international franchise system.

Initial franchise fees

Initial franchise fee revenue decreased $0.4 million from $21.6 million during the nine months ended September 30, 2022 to $21.2 million during nine months ended September 30, 2023. The decrease is primarily attributable to the quantity of domestic franchise agreement terminations as compared to the prior year.

Platform and procurement services fees

Revenues increased $10.3 million from $47.9 million for the nine months ended September 30, 2022 to $58.2 million for the nine months ended September 30, 2023. The increase is primarily attributable to an increase in the fees generated from travel-related partnerships and qualified vendors, and an increase in the fees generated from the Company's convention, inclusive of the activity from the newly acquired Radisson brand hotels.

Selling, general and administrative

SG&A expenses, which includes the cost to operate the business, increased $37.6 million from $144.4 million for the nine months ended September 30, 2022 to $182.0 million for the nine months ended September 30, 2023.

SG&A expenses increased $1.4 million related to operational restructuring charges that consisted primarily of salary and benefit continuation payments, $2.1 million related to transition costs associated with the integration of the Radisson Hotels Americas business, $1.6 million related to the expected performance under a financial guaranty, and an increase in general corporate costs including compensation, benefits, professional fees, travel, and conventions and meeting related expenses.

SG&A expenses also includes the expense attributable to increases in the Company's deferred compensation liabilities based on increases in the fair value of the underlying investments. The current period activity represents a $10.9 million increase in SG&A expense relative to the comparable period of the prior year.

Depreciation and amortization

Depreciation and amortization expense was $29.5 million and $20.4 million for the nine months ended September 30, 2023 and 2022, respectively. Depreciation and amortization expense increased primarily due to the acquisition of Radisson Hotels

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Americas and the associated amortization from the portion of the purchase price that was allocated to contract asset acquisition costs as well as the three hotel properties that were acquired in the transaction.

Interest expense

The Company recognized $46.5 million of interest expense for the nine months ended September 30, 2023, which was an increase of $14.4 million from the comparable period in 2022. The increase in interest expense is a result of increased borrowings and higher interest rates on the Company's revolving credit facility. Refer to the discussion under the Liquidity and Capital Resources section of MD&A.

Other loss (gain)

The Company recognized other net gains of $2.8 million for the nine months ended September 30, 2023, as compared to other net losses of $9.6 million for the nine months ended September 30, 2022. The gains relate to increases in the Company's deferred compensation assets based on increases in the fair value of the underlying investments.

Income tax expense

The effective income tax rates were 23.8% and 24.5% for the nine months ended September 30, 2023 and 2022, respectively. The effective income tax rates for the nine months ended September 30, 2023 and 2022 were higher than the U.S. federal income tax rate of 21.0% primarily due to the impact of state income taxes.

Liquidity and Capital Resources

Our Company historically generates strong and predictable operating cash flows primarily from our hotel franchising operations. Our capital allocation decisions, including capital structure and our uses of capital, are intended to maximize our return on invested capital and create value for our shareholders, while maintaining a strong balance sheet and financial flexibility. The Company's short-term and long-term liquidity requirements primarily arise from working capital needs, debt obligations, income tax payments, dividend payments, share repurchases, capital expenditures and investments in growth opportunities.

As of September 30, 2023, the Company's primary sources of liquidity consisted of $334.9 million in cash and available borrowing capacity under the senior unsecured revolving credit facility. As of September 30, 2023, the Company was in compliance with all of its financial covenants under its credit agreements and the Company expects to remain in such compliance. The Company believes that its cash on hand, available borrowing capacity under the senior unsecured revolving credit facility, cash flows from operations, and access to additional capital in the debt markets will provide sufficient liquidity to meet the expected future operating, investing and financing needs of the business.

Our board of directors authorized a program which permits us to offer financing, investment, and guaranty support to qualified franchisees, and to acquire or develop and then resell hotels, to incentivize franchise development of our brands in strategic markets. We are currently engaged in these financial support activities to encourage acceleration of the growth of our Cambria Hotels and Everhome Suites brands. With respect to these activities, the Company had approximately $436.7 million in support of the Cambria Hotels and Everhome Suites brands reflected in the consolidated balance sheets as of September 30, 2023. The Company is generally targeting to recycle these investments within a five year period, and expects our outstanding investments to not exceed $975 million at any point in time based on the current board of directors' authorization. We expect to continue to deploy capital in these manners in support of our brands. The deployment and annual pace of future financial support activities will depend upon market and other conditions, including among others, our franchise sales results, the environment for new construction hotel development, and the hotel lending environment.

The Company also strategically deploys capital in the form of franchise agreement acquisition payments across our brands to incentivize franchise development. As of September 30, 2023, the Company had commitments for an additional $350.3 million in franchise agreement acquisition payments, provided the conditions of the payments are met by the franchisees. The timing and amount of the franchise agreement acquisition costs are dependent on various factors including the implementation of various development and brand incentive programs, the level of franchise sales and the ability of our franchisees to complete construction or convert their hotels to one of the Company’s brands.

The Company has historically generated cash flow from operating activities in excess of the capital needed to invest in growth opportunities and to service debt obligations. As a result, the Company maintains a share repurchase program and typically pays a quarterly dividend. As of September 30, 2023, the Company had 2.3 million shares remaining under the current share repurchase authorization. The projected 2023 annual dividend rate is $1.15 per share or approximately $56.5 million in aggregate dividend payments, subject to future declarations by our board of directors.

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Cash Flows from Operating Activities

During the nine months ended September 30, 2023 and 2022, the net cash provided by operating activities was $247.2 million and $265.2 million, respectively. Our operating cash flows decreased $18.0 million primarily due to a decrease in the net surplus generated from our other franchised and managed properties activities, an increase in franchise agreement acquisition cost payments, an increase in SG&A expenses related to operational restructuring charges, due diligence and transition costs related to the integration of the Radisson Hotels Americas business acquired in August 2022, and an increase in borrowing costs, all of which were partially offset by the timing of working capital items.

In conjunction with brand and development programs, we strategically make certain payments to franchisees as an incentive to enter into new franchise agreements or perform designated improvements to properties under existing franchise agreements ("franchise agreement acquisition costs"). If the franchisee remains in the franchise system in good standing over the term specified in the incentive agreement, the Company forgives the incentive ratably. If the franchisee exits our franchise system or is not operating their franchise in accordance with our quality or credit standards and is terminated, then the franchisee must repay the unamortized incentive payment plus interest to the Company. During the nine months ended September 30, 2023 and 2022, the Company's net franchise agreement acquisition costs were $72.9 million and $32.9 million, respectively.

The Company’s legacy Choice franchise agreements require the payment of marketing and reservation system fees. In accordance with the terms of our legacy Choice franchise agreements, the Company is obligated to use the marketing and reservation system fees to provide marketing and reservation services. To the extent the revenues collected exceed the expenditures incurred, the Company has a commitment to the franchisee system to make expenditures in future years. Conversely, to the extent the expenditures incurred exceed the revenues collected, the Company has the contractual enforceable right to assess and collect such amounts from the franchisees, or to reduce its spending. The franchise and management contracts acquired in the Radisson Hotels Americas acquisition have similar terms as those described above with the exception of certain contractual elements concerning reservation fees, which are not required to break-even over time and are insignificant to the Company's operating income and net income. During the nine months ended September 30, 2023 and 2022, the net surplus generated from our other franchised and managed properties activities was $19.5 million and $55.4 million, respectively.

Cash Flows from Investing Activities

The net cash used in investing activities was $103.3 million and $483.7 million for the nine months ended September 30, 2023 and 2022, respectively.

During the nine months ended September 30, 2023 and 2022, capital expenditures in property and equipment totaled $81.4 million and $66.1 million, respectively. These capital expenditures primarily reflect the costs incurred to support the continued growth of the Cambria Hotels and Everhome Suites brands, including ongoing hotel development efforts, as well as leasehold improvements in the Company's new headquarters office space.

During the nine months ended September 30, 2022, the Company recognized net proceeds of $140.6 million from the sale of two Cambria hotels, one parcel of land, and a sale and conversion of an international direct franchising market to a master franchising market.

The Company maintains equity method investments in affiliates related to the Company's program to offer equity support to qualified franchisees to develop and operate Cambria Hotels and Everhome Suites branded-hotels in strategic markets. During the nine months ended September 30, 2023 and 2022, the Company invested $24.6 million and $4.3 million, respectively, to support these efforts. In addition, during the nine months ended September 30, 2023, the Company received proceeds from the sale of certain affiliates totaling $0.9 million. The Company received no distributions or sale proceeds from these affiliates during the nine months ended September 30, 2022.

The Company provides financing to franchisees for hotel development efforts and other purposes in the form of notes receivable loans. The loans bear interest and are expected to be repaid in accordance with the terms of the loan agreements. During the nine months ended September 30, 2023, the Company issued a total of $4.3 million in notes receivable loans and received a total of $9.9 million in notes receivable loan repayments. During the nine months ended September 30, 2022, the Company issued a total of $5.6 million in notes receivable loans and received a total of $0.7 million in notes receivable loan repayments.

On August 11, 2022, the Company acquired 100% of the issued and outstanding equity interest of Radisson Hotels Americas for an accounting purchase price of approximately $673.9 million. The purchase price, net of the cash acquired, was $550.4

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million. To fund the transaction, Choice drew down $175.0 million on the Company's senior unsecured credit facility, and then funded the remainder with cash on hand. Refer to Note 14 to our consolidated financial statements for further discussion.

During the nine months ended September 30, 2022, the Company recognized contract termination fee revenue of $22.7 million resulting from the exit of 110 WoodSpring units in September 2022. The contract termination fee revenue consists of $67.4 million in consideration, less the $44.7 million in carrying basis of intangible assets that were initially recognized on the date of the WoodSpring acquisition. During the third and fourth quarters of 2022, the Company received cash of $5.7 million and $61.7 million, respectively.

Cash Flows from Financing Activities

Cash flows from financing activities primarily relate to the proceeds or payments on the Company's borrowings, treasury stock repurchases, acquisition of shares in connection with the exercise or vesting of equity awards, the payment of dividends, and the payment of debt issuance costs.

Debt

Restated Senior Unsecured Credit Facility

On August 20, 2018, the Company entered into the Restated Senior Unsecured Credit Agreement (the "Restated Credit Agreement"), which amended and restated the Company’s existing senior unsecured revolving credit agreement dated July 21, 2015. The Restated Credit Agreement provided for a $600 million unsecured credit facility with an original maturity date of August 20, 2023, subject to one-year extension options that could be requested by the Company prior to each of the first, second, and third anniversaries of the closing date of the Restated Credit Agreement in exchange for the payment fees. The Company has exercised the one-year extension option on multiple occasions, which has resulted in a new maturity date of August 20, 2026. The Restated Credit Agreement allows for up to $35 million of borrowings that may be used for alternative currency loans and up to $25 million of borrowings that may be used for swingline loans. From time to time, the Company may designate one or more wholly-owned subsidiaries of the Company as additional borrowers under the Restated Credit Agreement, subject to the consent of the lenders and certain customary conditions. There are no subsidiary guarantors under the Restated Credit Agreement.

On February 18, 2020, the Company entered into the First Amendment to the Amended and Restated Senior Unsecured Credit Agreement which, among other things, removed a springing guarantee (requiring subsidiaries to guarantee the Company's obligations under the Restated Credit Agreement if the subsidiary incurs certain recourse debt) and other provisions and references in the Restated Credit Agreement related to the potential existence of subsidiary guarantors.

On February 14, 2023, the Company entered into a Third Amendment to the Amended and Restated Senior Unsecured Credit Agreement. This amendment provides, among other things, for (i) an increase in the aggregate amount of commitments under the Company's existing $600 million unsecured credit facility (the "Revolver") by $250 million (the “Increased Commitments”) to an aggregate amount of $850 million, and (ii) the replacement of the interest reference rate for U.S. dollar-denominated borrowings under the Revolver from LIBOR to an adjusted SOFR.

The Restated Credit Agreement requires the Company to pay a fee on the total commitments, calculated on the basis of the actual daily amount of the commitments (regardless of usage) times a percentage per annum ranging from 0.075% to 0.25%, which is dependent on the Company’s senior unsecured long-term debt rating or other circumstances as set forth in the Restated Credit Agreement if the Company’s total leverage ratio is less than 2.5 to 1.0.

The Restated Credit Agreement requires that the Company and its restricted subsidiaries comply with various covenants, including restrictions on liens, incurring indebtedness, making investments, and effecting mergers and/or asset sales. With respect to the payment of dividends, the Company may not declare or make any dividend payments if there is an existing event of default or if the dividend payment would create an event of default.

The Restated Credit Agreement imposes financial covenants that require the Company to maintain a consolidated fixed charge coverage ratio of at least 2.5 to 1.0 and a total leverage ratio of not more than 4.5 to 1.0. In addition, on up to two nonconsecutive occasions, the Company will be required to maintain a total leverage ratio of not more than 5.5 to 1.0 for up to three consecutive quarters following a material acquisition commencing with the fiscal quarter in which the material acquisition occurred. The Company maintains an Investment Grade Rating, as defined in the Restated Credit Agreement, and therefore is not currently required to comply with the consolidated fixed charge coverage ratio covenant.

The Restated Credit Agreement includes customary events of default, the occurrence of which, following any applicable cure period, would permit the lenders to, among other things, declare the principal, accrued interest and other obligations under the Restated Credit Agreement to be immediately due and payable. As of September 30, 2023, the Company maintained a total

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leverage ratio of 2.34x, including outstanding debt of approximately $549.4 million on the senior unsecured revolving credit facility. The Company was in compliance with all financial covenants under the Restated Credit Agreement.

Debt issuance costs incurred in connection with the Restated Credit Agreement are amortized on a straight-line basis, which is not materially different from the effective interest method, and through the loan's maturity date. The amortization of the debt issuance costs is included in interest expense in the consolidated statements of income.

The proceeds of the Restated Credit Agreement are generally expected to be used for general corporate purposes, including working capital, debt repayment, stock repurchases, dividends, investments and other permitted uses as set forth in the Restated Credit Agreement.

Senior Unsecured Notes Due 2031

On July 23, 2020, the Company issued unsecured senior notes with a principal amount of $450 million (the "2020 Senior Notes") bearing a coupon of 3.70%. The 2020 Senior Notes will mature on January 15, 2031, with interest to be paid semi-annually on January 15th and July 15th. The Company used the net proceeds of the 2020 Senior Notes, after deducting underwriting discounts, commissions and offering expenses, to repay in full the $250 million Term Loan entered in April 2020 and to fund the purchase price of the 2012 Senior Notes tendered and accepted by the Company for the purchase pursuant to the tender offer (discussed further below under "Senior Unsecured Notes Due 2022").

The interest rate payable on the 2020 Senior Notes is subject to adjustment based on certain rating events. The Company may redeem the 2020 Senior Notes, in whole or in part, at its option at the applicable redemption price before the maturity date. If the Company redeems the 2020 Senior Notes prior to October 15, 2030 (three months prior to the maturity date) (the “2020 Notes Par Call Date”), the redemption price will be equal to the greater of (a) 100% of the principal amount of the notes to be redeemed, or (b) the sum of the present values of the remaining scheduled principal and interest payments that would have been payable had the 2020 Senior Notes matured on the 2020 Notes Par Call Date, discounted to the redemption date on a semi-annual basis at the applicable Treasury Rate plus 50 basis points, plus accrued and unpaid interest. If the Company redeems the 2020 Senior Notes on or after the 2020 Notes Par Call Date, the redemption price will equal 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest. Additionally, at the option of the holders of the 2020 Senior Notes, the Company may be required to repurchase all or a portion of the 2020 Senior Notes upon the occurrence of a change of control event at a price equal to 101% of their aggregate principal amount, plus accrued and unpaid interest, to the date of repurchase.

Senior Unsecured Notes Due 2029

On November 27, 2019, the Company issued unsecured senior notes with a principal amount of $400 million (the "2019 Senior Notes") at a discount of $2.4 million, bearing a coupon of 3.70% with an effective rate of 3.88%. The 2019 Senior Notes will mature on December 1, 2029, with interest to be paid semi-annually on December 1st and June 1st. The Company used the net proceeds of this offering, after deducting underwriting discounts, commissions and other offering expenses, to repay the previously outstanding senior notes with a principal amount of $250 million due August 28, 2020, and for working capital and other general corporate purposes.

The Company may redeem the 2019 Senior Notes, in whole or in part, at its option at the applicable redemption price before maturity. If the Company redeems the 2019 Senior Notes prior to September 1, 2029 (three months prior to the maturity date) (the “2019 Notes Par Call Date”), the redemption price will be equal to the greater of (a) 100% of the principal amount of the notes to be redeemed, or (b) the sum of the present values of the remaining scheduled principal and interest payments that would have been payable had the 2019 Senior Notes matured on the 2019 Notes Par Call Date, discounted to the redemption date on a semi-annual basis at the applicable Treasury Rate plus 30 basis points, plus accrued and unpaid interest. If the Company redeems the 2019 Senior Notes on or after the 2019 Notes Par Call Date, the redemption price will equal 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest. Additionally, at the option of the holders of the 2019 Senior Notes, the Company may be required to repurchase all or a portion of the 2019 Senior Notes upon the occurrence of a change of control event at a price equal to 101% of their aggregate principal amount, plus accrued and unpaid interest, to the date of repurchase.

Senior Unsecured Notes Due 2022

On June 27, 2012, the Company issued unsecured senior notes with a principal amount of $400 million (the "2012 Senior Notes") at par, bearing a coupon of 5.75% with an effective rate of 6.00%. The Company utilized the net proceeds from this offering, after deducting underwriting discounts, commissions and other offering expenses, together with borrowings under the Company's senior unsecured senior credit facility, to pay a special cash dividend to shareholders that totaled approximately $600.7 million on August 23, 2012.

34

On July 9, 2020, the Company commenced a tender offer (the "Tender Offer") to purchase an aggregate principal amount of up to $160.0 million of the 2012 Senior Notes, subject to increase or decrease. The Tender Offer was subsequently upsized to an aggregate principal amount of up to $180.0 million of the 2012 Senior Notes. On July 23, 2020, the Company amended the Tender Offer by increasing the aggregate principal amount from $180.0 million to $183.4 million. The Tender Offer settled on July 24, 2020 for $197.8 million, which included an early tender premium, settlement fees, and accrued interest paid. In combination with the early pay off of the Term Loan, the Company recorded a loss on extinguishment of debt of $16.0 million in the third quarter of 2020.

The 2012 Senior Notes matured on July 1, 2022. The outstanding principal amount of $216.6 million was re-paid on the maturity date.

Economic Development Loans

The Company entered into economic development agreements with various governmental entities in conjunction with the relocation of its corporate headquarters in April 2013. In accordance with these agreements, the governmental entities agreed to advance approximately $4.4 million to the Company to offset a portion of the corporate headquarters relocation and tenant improvement costs in consideration of the employment of permanent, full-time employees within the jurisdictions. As of September 30, 2023, the Company had been advanced the full amounts that were due pursuant to these agreements. These advances bear interest at a rate of 3% per annum.

Repayment of the advances is contingent upon the Company achieving certain performance conditions. The performance conditions are measured annually on December 31st and primarily relate to maintaining certain levels of employment within the various jurisdictions. If the Company fails to meet an annual performance condition, then the Company may be required to repay a portion, or all, of the advances including accrued interest by April 30th following the measurement date. Any outstanding advances upon expiration of the Company's current ten-year corporate headquarters lease agreement in 2023 will be forgiven in full. The advances are presented within debt in the Company's consolidated balance sheets. The Company will continue to evaluate whether the future performance conditions will be met over the entire term of the agreement and whether the Company will, or will not, be required to repay the advances. The Company accrues interest on the portion of the advances that it expects to repay. The Company was in material compliance with all applicable performance conditions as of September 30, 2023.

Acquired Debt and Swap Derivative Asset

On August 11, 2022, in connection with the Radisson Hotels Americas acquisition, the Company acquired three owned hotel properties, one of which had an encumbered mortgage loan with a mortgage principal in the amount of $53.5 million with an original maturity date of August 7, 2024. In addition, the mortgage loan had an associated interest rate cap agreement with an effective date of July 30, 2021 through August 6, 2024. On August 12, 2022, the Company paid off the outstanding mortgage loan principal, outstanding interest, and certain prepayment, exit and related fees in the amount of $56.0 million. At the same time, several of the loan-related escrows were released in the amount of $10.4 million. On August 16, 2022, the interest rate cap agreement was terminated, which resulted in a $1.9 million payment to the Company.

Dividends

During the year ended December 31, 2022, the Company declared cash dividends at a quarterly rate of $0.2375 per share of common stock. In March 2023, the Company's board of directors approved a 21% increase in the quarterly cash dividend to $0.2875 per share, which is the current per share dividend amount that was utilized in each of the dividends that were declared in 2023.

During the nine months ended September 30, 2023, the Company paid $42.1 million in cash dividends. We expect that cash dividends will continue to be paid in the future, subject to the declaration by our board of directors, future business performance, economic conditions, changes in tax regulations, and other matters. Based on the current per share dividend amount and our outstanding share count, the aggregate annual dividends for 2023 are projected to be $1.15 per share or approximately $56.5 million in aggregate dividend payments.

In accordance with the Restated Credit Agreement, the Company may not declare or make any dividend payments if there is an existing event of default or if the dividend payment would create an event of default.

Share Repurchases and Redemptions

In 1998, we instituted a share repurchase program. Treasury stock activity is recorded at cost in the consolidated balance sheets.

35

During the nine months ended September 30, 2023, the Company repurchased 2.4 million shares of its common stock under the share repurchase program at a total cost, including accrued excise tax, of $292.9 million. In total through September 30, 2023, the Company repurchased 57.8 million shares of its common stock (including 33.0 million prior to the two-for-one stock split effected in October 2005) under the program at a total cost of $2.2 billion. Considering the effect of the two-for-one stock split, the Company has repurchased 90.8 million shares at an average price of $24.38 per share. As of September 30, 2023, the Company had 2.3 million shares remaining under the current share repurchase authorization.

During the nine months ended September 30, 2023, the Company redeemed 0.1 million shares of common stock at a total cost of $14.1 million from employees to satisfy the option exercise price and statutory minimum tax-withholding requirements related to the exercising of stock options and vesting of PVRSUs and restricted stock grants. These redemptions were outside the share repurchase program. During the nine months ended September 30, 2023, the Company received proceeds of $6.7 million from stock options exercised by employees.

Critical Accounting Policies

Our accounting policies comply with principles generally accepted in the United States. A discussion of our accounting policies is included in Note 1 to our consolidated financial statements as of and for the year ended December 31, 2022 included in our Annual Report on Form 10-K, which incorporates a description of our critical accounting policies that involve subjective and complex judgments that could potentially affect our reported results.

New Accounting Standards

Refer to Note 1 to these consolidated financial statements for information related to our evaluation of new accounting standards.

FORWARD-LOOKING STATEMENTS

Certain matters discussed in this quarterly report constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as "expect," "estimate," "believe," "anticipate," "should," "will," "forecast," "plan," "project," "assume," or similar words of futurity. All statements other than historical facts are forward-looking statements. These forward-looking statements are based on management's current beliefs, assumptions and expectations regarding future events, which, in turn, are based on information currently available to management. Such statements may relate to projections of the Company's revenue, expenses, Adjusted EBITDA, earnings, debt levels, ability to repay outstanding indebtedness, payment of dividends, repurchases of common stock, and other financial and operational measures, including occupancy and open hotels, RevPAR, our ability to benefit from any rebound in travel demand, and our liquidity, among other matters. We caution you not to place undue reliance on any such forward-looking statements. Forward-looking statements do not guarantee future performance and involve known and unknown risks, uncertainties and other factors.

Several factors could cause our actual results, performance or achievements to differ materially from those expressed in or contemplated by the forward-looking statements. Such risks include, but are not limited to, changes to general, domestic and foreign economic conditions, including access to liquidity and capital; the Company’s ability to successfully integrate Radisson Hotels Americas’ employees and operations; the ability to realize the anticipated benefits and synergies of the acquisition of Radisson Hotels Americas as rapidly or to the extent anticipated; changes in consumer demand and confidence, including consumer discretionary spending and the demand for travel, transient and group business; the timing and amount of future dividends and share repurchases; future domestic or global outbreaks of epidemics, pandemics or contagious diseases or fear of such outbreaks, including any resurgence of the COVID-19 pandemic, and the related impact on the global hospitality industry, particularly but not exclusively the U.S. travel market; changes in law and regulation applicable to the travel, lodging or franchising industries, including with respect to the status of our relationship with employees of our franchisees; foreign currency fluctuations; impairments or declines in the value of our assets; operating risks common in the travel, lodging or franchising industries; changes to the desirability of our brands as viewed by hotel operators and customers; changes to the terms or termination of our contracts with franchisees and our relationships with our franchisees; our ability to keep pace with improvements in technology utilized for marketing and reservations systems and other operating systems; the commercial acceptance of our SaaS technology solutions division's products and services; our ability to grow our franchise system; exposure to risks related to our hotel development, financing, and ownership activities; exposures to risks associated with our investments in new businesses; fluctuations in the supply and demand for hotel rooms; our ability to realize anticipated benefits from acquired businesses; impairments or losses relating to acquired businesses; the level of acceptance of alternative growth strategies we may implement; the impact of inflation; cyber security and data breach risks; climate change and sustainability related concerns; ownership and financing activities; hotel closures or financial difficulties of our franchisees; operating risks associated with our international operations; labor shortages; the outcome of litigation; our ability to effectively manage our indebtedness and secure our indebtedness, including additional indebtedness incurred as a result of the acquisition of Radisson Hotels Americas; and developments with respect to our proposal to acquire Wyndham. These and other risk factors are

36

discussed in detail in the Risk Factors section of this Quarterly Report on Form 10-Q and of the Company's Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 1, 2023. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to market risk from changes in interest rates and the impact of fluctuations in foreign currencies on the Company's foreign investments and operations. The Company manages its exposure to these market risks through the monitoring of its available financing alternatives including, in certain circumstances, the use of derivative financial instruments. We are also subject to risk from changes in debt and equity prices from our non-qualified retirement savings plan investments in debt securities and common stock, which have a carrying value of $37.8 million and $32.4 million as of September 30, 2023 and December 31, 2022, respectively, which we account for as trading securities. The Company will continue to monitor the exposure in these areas and make the appropriate adjustments as market conditions dictate.

As of September 30, 2023, the Company had $545 million of variable interest rate debt instruments outstanding at an effective interest rate of 6.40%. A hypothetical change of 10% in the Company’s effective interest rate from September 30, 2023 levels would increase or decrease annual interest expense by $3.5 million. The Company expects to refinance its fixed and variable interest rate long-term debt obligations prior to their scheduled maturities.

The Company does not presently have any derivative financial instruments.

ITEM 4.CONTROLS AND PROCEDURES

Management’s Evaluation of Disclosure Controls and Procedures

The Company has a disclosure review committee whose membership includes the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), among others. The disclosure review committee’s procedures are considered by the CEO and CFO in performing their evaluations of the Company’s disclosure controls and procedures and in assessing the accuracy and completeness of the Company’s disclosures.

Our management, with the participation of our CEO and CFO, has evaluated the effectiveness of our disclosure controls and procedures, as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, (the “Exchange Act”), as of the end of the period covered by this quarterly report as required by Rules 13a-15(b) or 15d-15(b) under the Exchange Act. Our management, including our CEO and CFO, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met.

An evaluation was performed under the supervision and with the participation of the Company’s CEO and CFO, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on that evaluation, the Company’s management, including the CEO and CFO, concluded that the Company’s disclosure controls and procedures were effective as of September 30, 2023.

Changes in internal control over financial reporting

There have been no changes in the Company’s internal control over financial reporting during the period ended September 30, 2023 that materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

37

PART II. OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

The Company is not a party to any material litigation other than litigation in the ordinary course of business. The Company's management and legal counsel do not expect that the ultimate outcome of any of its currently ongoing legal proceedings, individually or collectively, will have a material adverse effect on the Company's financial position, results of operations or cash flows.

ITEM 1A.RISK FACTORS

There have been no material changes in our risk factors from those disclosed in Part I, "Item 1A. Risk Factors" to our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, all of which could materially affect our business, financial condition or future results. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also materially adversely affect our business, financial condition and/or operating results.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table sets forth the purchases and redemptions of Choice Hotels International, Inc. common stock made by the Company during the nine months ended September 30, 2023. Refer to the Liquidity and Capital Resources section of "Management's Discussion and Analysis of Financial Condition and Results of Operations" for more information.

Month Ending	Total Number of Shares Purchased or Redeemed	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)	Maximum Number of Shares that may yet be Purchased Under the Plans or Programs, End of Period
January 31, 2023	554,622	$	118.66	554,622	4,120,542
February 28, 2023	404,509	124.03		404,509	3,716,033
March 31, 2023	382,389	119.44		272,089	3,443,944
April 30, 2023	183,083	122.85		182,949	3,260,995
May 31, 2023	207,507	123.84		206,009	3,054,986
June 30, 2023	228,469	116.03		228,469	2,826,517
July 31, 2023	203,134	122.20		203,134	2,623,383
August 31, 2023	177,635	131.26		177,003	2,446,380
September 30, 2023	177,991	126.38		177,763	2,268,617
Total	2,519,339	$	121.85	2,406,547	2,268,617

(1) During the nine months ended September 30, 2023, the Company redeemed 112,792 shares of common stock from employees to satisfy the option price and the minimum tax-withholding requirements related to the exercising of stock options and the vesting of restricted stock and performance vested restricted stock unit grants. These redemptions were not part of the board repurchase authorization.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.MINE SAFETY DISCLOSURES

None.

ITEM 5.OTHER INFORMATION

Director and Officer Trading Arrangements

None of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarterly period covered by this quarterly report.

38

ITEM 6.EXHIBITS

Exhibit Number and Description

Exhibit Number	Description
3.01(a)	Restated Certificate of Incorporation of Choice Hotels Franchising, Inc. (renamed Choice Hotels International, Inc.)
3.02(b)	Amendment to the Restated Certificate of Incorporation of Choice Hotels International, Inc.
3.03(c)	Amended and Restated Bylaws of Choice Hotels International, Inc.
3.04(d)	Amendment to the Amended and Restated Bylaws of Choice Hotels International, Inc.
3.05(e)	Amendment to the Amended and Restated Bylaws of Choice Hotels International, Inc.
31.1*	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a)
31.2*	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a)
32*	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350
101.INS*	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*	Inline XBRL Taxonomy Extension Schema Document
101.CAL*	Inline XBRL Taxonomy Calculation Linkbase Document
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	Inline XBRL Taxonomy Label Linkbase Document
101.PRE*	Inline XBRL Taxonomy Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith

(a)    Incorporated by reference to the identical document filed as an exhibit to Choice Hotels International, Inc.'s Registration Statement on Form S-4, filed August 31, 1998 (Reg. No. 333-62543).

(b)    Incorporated by reference to the identical document filed as an exhibit to Choice Hotels International, Inc.'s Current Report on Form 8-K filed May 1, 2013.

(c)    Incorporated by reference to the identical document filed as an exhibit to Choice Hotels International, Inc.'s Current Report on Form 8-K filed February 16, 2010.

(d)    Incorporated by reference to the identical document filed as an exhibit to Choice Hotels International, Inc.'s Current Report on Form 8-K filed April 29, 2015.

(e)    Incorporated by reference to the identical document filed as an exhibit to Choice Hotels International, Inc.'s Current Report on Form 8-K filed on January 13, 2016.

39

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CHOICE HOTELS INTERNATIONAL, INC.
November 7, 2023	By:	/s/ PATRICK S. PACIOUS
		Patrick S. Pacious
		President & Chief Executive Officer
	CHOICE HOTELS INTERNATIONAL, INC.
November 7, 2023	By:	/s/ SCOTT E. OAKSMITH
		Scott E. Oaksmith
		Chief Financial Officer

40

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Patrick S. Pacious, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of Choice Hotels International, Inc.;

2.    Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.    Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.    The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and

(d)    Disclosed in this quarterly report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5.    The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

November 7, 2023	/s/ PATRICK S. PACIOUS
	Patrick S. Pacious
	President & Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Scott E. Oaksmith, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of Choice Hotels International, Inc.;

2.    Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3.    Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4.    The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and

(d)    Disclosed in this quarterly report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5.    The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

November 7, 2023	/s/ SCOTT E. OAKSMITH
	Scott E. Oaksmith
	Chief Financial Officer

EX-32

Exhibit 32

WRITTEN STATEMENT

OF

CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

The undersigned hereby certify that the Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 filed by Choice Hotels International, Inc. with the Securities and Exchange Commission fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the issuer.

November 7, 2023	/s/ PATRICK S. PACIOUS
	Patrick S. Pacious
	President & Chief Executive Officer
November 7, 2023	/s/ SCOTT E. OAKSMITH
	Scott E. Oaksmith
	Chief Financial Officer

XML

Cover Page - shares	9 Months Ended
	Sep. 30, 2023	Oct. 31, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-13393
Entity Registrant Name	CHOICE HOTELS INTERNATIONAL INC /DE
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	52-1209792
Entity Address, Address Line One	1 Choice Hotels Circle
Entity Address, City or Town	Rockville,
Entity Address, State or Province	MD
Entity Address, Postal Zip Code	20850
City Area Code	301
Local Phone Number	592-5000
Title of 12(b) Security	Common Stock, Par Value $0.01 per share
Trading Symbol	CHH
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		49,798,586
Entity Central Index Key	0001046311
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
REVENUES
REVENUES	$ 425,557	$ 414,266	$ 1,185,769	$ 1,039,967
OPERATING EXPENSES
Selling, general and administrative	54,913	70,202	182,000	144,414
Depreciation and amortization	9,633	8,726	29,468	20,436
Total operating expenses	290,515	282,627	848,487	654,891
Gain on sale of business and assets, net	0	13,379	0	16,688
Operating income	135,042	145,018	337,282	401,764
OTHER INCOME AND EXPENSES, NET
Interest expense	16,168	9,362	46,522	32,084
Interest income	(1,897)	(2,348)	(5,836)	(5,256)
Other loss (gain)	1,343	2,303	(2,752)	9,578
Equity in net gain of affiliates	(1,801)	(1,075)	(1,923)	(1,279)
Total other income and expenses, net	13,813	8,242	36,011	35,127
Income before income taxes	121,229	136,776	301,271	366,637
Income tax expense	29,205	33,696	71,717	89,998
Net income	$ 92,024	$ 103,080	$ 229,554	$ 276,639
Basic earnings per share (in usd per share)	$ 1.83	$ 1.87	$ 4.51	$ 4.98
Diluted earnings per share (in usd per share)	1.81	1.85	4.47	4.93
Cash dividends declared per share (in usd per share)	$ 0.2875	$ 0.2375	$ 0.8625	$ 0.7125
Royalty, licensing and management fees
REVENUES
REVENUES	$ 148,512	$ 144,020	$ 396,503	$ 356,208
Initial franchise fees
REVENUES
REVENUES	6,194	7,011	21,240	21,635
Platform and procurement services fees
REVENUES
REVENUES	15,542	14,401	58,186	47,887
Owned hotels
REVENUES
REVENUES	26,239	19,992	74,075	49,220
OPERATING EXPENSES
Operating expenses	18,628	13,158	53,924	32,004
Other
REVENUES
REVENUES	11,436	31,432	33,211	51,588
Other revenues from franchised and managed properties
REVENUES
REVENUES	217,634	197,410	602,554	513,429
OPERATING EXPENSES
Operating expenses	$ 207,341	$ 190,541	$ 583,095	$ 458,037

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 92,024	$ 103,080	$ 229,554	$ 276,639
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	(191)	(902)	498	(1,139)
Other comprehensive income (loss), net of tax	(191)	(902)	498	(1,139)
Comprehensive income	$ 91,833	$ 102,178	$ 230,052	$ 275,500

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 36,432	$ 41,566
Accounts receivable (net of allowance for credit losses of $28,883 and $23,435, respectively)	223,781	216,614
Income taxes receivable	5,743	4,759
Notes receivable (net of allowance for credit losses of $2,206 and $4,125, respectively)	52,726	52,466
Prepaid expenses and other current assets	34,130	32,517
Total current assets	352,812	347,922
Property and equipment (net of accumulated depreciation and amortization of $292,786 and $253,323, respectively)	469,771	427,306
Operating lease right-of-use assets	90,474	68,985
Goodwill	220,187	218,653
Intangible assets (net of accumulated amortization of $220,803 and $201,401, respectively)	781,101	742,190
Notes receivable (net of allowance for credit losses of $6,183 and $6,047, respectively)	49,831	55,577
Investments for employee benefit plans, at fair value	35,815	31,645
Investments in affiliates	55,081	30,647
Deferred income taxes	92,410	88,182
Other assets	84,755	91,068
Total assets	2,232,237	2,102,175
Current liabilities
Accounts payable	124,113	118,863
Accrued expenses and other current liabilities	96,523	131,410
Deferred revenue	107,802	92,695
Current portion of long-term debt	4,416	2,976
Liability for guest loyalty programs	86,140	89,954
Total current liabilities	418,994	435,898
Long-term debt	1,391,272	1,200,547
Long-term deferred revenue	135,009	134,149
Deferred compensation and retirement plan obligations	41,200	36,673
Income taxes payable	8,601	15,482
Operating lease liabilities	109,746	70,994
Liability for guest loyalty programs	44,320	47,381
Other liabilities	10,682	6,391
Total liabilities	2,159,824	1,947,515
Commitments and contingencies (Note 12)
Common stock, $0.01 par value; 160,000,000 shares authorized; 95,065,638 shares issued at September 30, 2023 and December 31, 2022; 50,026,433 and 52,200,903 shares outstanding at September 30, 2023 and December 31, 2022, respectively	951	951
Additional paid-in-capital	321,790	298,053
Accumulated other comprehensive loss	(4,713)	(5,211)
Treasury stock, at cost; 45,039,205 and 42,864,735 shares at September 30, 2023 and December 31, 2022, respectively	(1,987,262)	(1,694,857)
Retained earnings	1,741,647	1,555,724
Total shareholders’ equity	72,413	154,660
Total liabilities and shareholders’ equity	$ 2,232,237	$ 2,102,175

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 28,883	$ 23,435
Allowance for credit losses, current	2,206	4,125
Accumulated depreciation and amortization, property, plant and equipment	292,786	253,323
Intangible assets, accumulated amortization	220,803	201,401
Allowance for credit losses, noncurrent	$ 6,183	$ 6,047
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	160,000,000	160,000,000
Common stock, shares issued (in shares)	95,065,638	95,065,638
Common stock, shares outstanding (in shares)	50,026,433	52,200,903
Treasury stock, shares (in shares)	45,039,205	42,864,735

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 229,554	$ 276,639
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	29,468	20,436
Depreciation and amortization – marketing and reservation system	27,544	23,237
Gain on sale of business and assets, net	0	(16,688)
Franchise agreement acquisition cost amortization	14,616	11,558
Non-cash share-based compensation and other charges	34,670	28,621
Non-cash interest, investment, and affiliate (income) loss, net	(1,709)	9,135
Deferred income taxes	(4,315)	(22,402)
Equity in net (gain) loss of affiliates, less distributions received	(621)	2,451
Franchise agreement acquisition costs, net of reimbursements	(72,867)	(32,947)
Change in working capital and other	(9,150)	(34,838)
Net cash provided by operating activities	247,190	265,202
CASH FLOWS FROM INVESTING ACTIVITIES
Investments in property and equipment	(81,403)	(66,084)
Investments in intangible assets	(1,893)	(3,247)
Asset acquisitions, net of cash paid	0	(856)
Proceeds from the sale of assets and business	0	140,554
Proceeds from the termination of intangible assets	0	5,698
Business acquisitions, net of cash acquired	0	(550,431)
Contributions to investments in affiliates	(24,573)	(4,264)
Proceeds from the sale of affiliates	868	0
Purchases of investments for employee benefit plans	(3,678)	(3,719)
Proceeds from sales of investments for employee benefit plans	1,263	1,896
Issuances of notes receivable	(4,319)	(5,617)
Collections of notes receivable	9,923	701
Other items, net	547	1,708
Net cash used in investing activities	(103,265)	(483,661)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments to extinguish acquired debt	0	(55,975)
Proceeds from acquired derivative	0	1,943
Net borrowings pursuant to revolving credit facilities	191,500	315,000
Principal payments on 2012 senior notes	0	(216,571)
Debt issuance costs	(755)	(24)
Purchases of treasury stock	(304,400)	(246,530)
Proceeds from the exercise of stock options	6,719	2,361
Dividends paid	(42,073)	(39,697)
Net cash used in financing activities	(149,009)	(239,493)
Net change in cash and cash equivalents	(5,084)	(457,952)
Effect of foreign exchange rate changes on cash and cash equivalents	(50)	(1,112)
Cash and cash equivalents, beginning of period	41,566	511,605
Cash and cash equivalents, end of period	36,432	52,541
Cash payments during the period for
Income taxes, net of refunds	70,614	81,479
Interest, net of capitalized interest	44,993	36,691
Non-cash investing and financing activities
Dividends declared but not paid	15,239	12,776
Investment in property, equipment and intangible assets acquired in accounts payable and accrued liabilities	8,064	5,352
Asset acquisition from extinguishment of note receivable	$ 0	$ 20,446

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CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Thousands		Total	Common Stock	Additional Paid-in- Capital	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Retained Earnings
Beginning balance (in shares) at Dec. 31, 2021			55,609,226
Beginning balance at Dec. 31, 2021		$ 265,882	$ 951	$ 259,317	$ (4,574)	$ (1,265,032)	$ 1,275,220
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		67,391					67,391
Other comprehensive income (loss), net of tax		(134)			(134)
Share-based payment activity (in shares)	[1]		262,008
Share-based payment activity	[1]	9,558		6,068		3,486	4
Dividends declared		(13,250)					(13,250)
Treasury purchases (in shares)			(100,912)
Treasury purchases		(14,802)				(14,802)
Ending balance (in shares) at Mar. 31, 2022			55,770,322
Ending balance at Mar. 31, 2022		314,645	$ 951	265,385	(4,708)	(1,276,348)	1,329,365
Beginning balance (in shares) at Dec. 31, 2021			55,609,226
Beginning balance at Dec. 31, 2021		265,882	$ 951	259,317	(4,574)	(1,265,032)	1,275,220
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		276,639
Other comprehensive income (loss), net of tax		(1,139)
Ending balance (in shares) at Sep. 30, 2022			53,773,667
Ending balance at Sep. 30, 2022		284,511	$ 951	284,092	(5,713)	(1,507,423)	1,512,604
Beginning balance (in shares) at Mar. 31, 2022			55,770,322
Beginning balance at Mar. 31, 2022		314,645	$ 951	265,385	(4,708)	(1,276,348)	1,329,365
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		106,168					106,168
Other comprehensive income (loss), net of tax		(103)			(103)
Share-based payment activity (in shares)	[1]		12,422
Share-based payment activity	[1]	9,595		8,999		596
Dividends declared		(13,242)					(13,242)
Treasury purchases (in shares)			(2,422)
Treasury purchases		(338)				(338)
Ending balance (in shares) at Jun. 30, 2022			55,780,322
Ending balance at Jun. 30, 2022		416,725	$ 951	274,384	(4,811)	(1,276,090)	1,422,291
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		103,080					103,080
Other comprehensive income (loss), net of tax		(902)			(902)
Share-based payment activity (in shares)	[1]		(1,655)
Share-based payment activity	[1]	9,763		9,708		55	0
Dividends declared		(12,767)					(12,767)
Treasury purchases (in shares)			(2,005,000)
Treasury purchases		(231,388)				(231,388)
Ending balance (in shares) at Sep. 30, 2022			53,773,667
Ending balance at Sep. 30, 2022		$ 284,511	$ 951	284,092	(5,713)	(1,507,423)	1,512,604
Beginning balance (in shares) at Dec. 31, 2022		52,200,903	52,200,903
Beginning balance at Dec. 31, 2022		$ 154,660	$ 951	298,053	(5,211)	(1,694,857)	1,555,724
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		52,820					52,820
Other comprehensive income (loss), net of tax		394			394
Share-based payment activity (in shares)	[1]		315,049
Share-based payment activity	[1]	15,396		1,899		13,497
Dividends declared		(14,709)					(14,709)
Treasury purchases (in shares)	[2]		(1,341,520)
Treasury purchases	[2]	(161,553)				(161,553)
Ending balance (in shares) at Mar. 31, 2023			51,174,432
Ending balance at Mar. 31, 2023		$ 47,008	$ 951	299,952	(4,817)	(1,842,913)	1,593,835
Beginning balance (in shares) at Dec. 31, 2022		52,200,903	52,200,903
Beginning balance at Dec. 31, 2022		$ 154,660	$ 951	298,053	(5,211)	(1,694,857)	1,555,724
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		229,554
Other comprehensive income (loss), net of tax		$ 498
Ending balance (in shares) at Sep. 30, 2023		50,026,433	50,026,433
Ending balance at Sep. 30, 2023		$ 72,413	$ 951	321,790	(4,713)	(1,987,262)	1,741,647
Beginning balance (in shares) at Mar. 31, 2023			51,174,432
Beginning balance at Mar. 31, 2023		47,008	$ 951	299,952	(4,817)	(1,842,913)	1,593,835
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		84,710					84,710
Other comprehensive income (loss), net of tax		295			295
Share-based payment activity (in shares)	[1]		10,508
Share-based payment activity	[1]	11,915		11,336		579
Dividends declared		(14,540)					(14,540)
Treasury purchases (in shares)	[2]		(619,059)
Treasury purchases	[2]	(74,697)				(74,697)
Ending balance (in shares) at Jun. 30, 2023			50,565,881
Ending balance at Jun. 30, 2023		54,691	$ 951	311,288	(4,522)	(1,917,031)	1,664,005
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		92,024					92,024
Other comprehensive income (loss), net of tax		(191)			(191)
Share-based payment activity (in shares)	[1]		22,372
Share-based payment activity	[1]	10,905		10,502		403
Dividends declared		(14,382)					(14,382)
Treasury purchases (in shares)	[2]		(561,820)
Treasury purchases	[2]	$ (70,634)				(70,634)
Ending balance (in shares) at Sep. 30, 2023		50,026,433	50,026,433
Ending balance at Sep. 30, 2023		$ 72,413	$ 951	$ 321,790	$ (4,713)	$ (1,987,262)	$ 1,741,647

[1] During certain periods presented, accumulated dividends were paid to certain shareholders upon vesting of their performance vested restricted stock units ("PVRSU") which are presented in Share-based payment activity.

[2] Beginning January 1, 2023, Treasury purchases include an excise tax as imposed by the Inflation Reduction Act of 2022.

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CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Parenthetical) - $ / shares	3 Months Ended						9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Stockholders' Equity [Abstract]
Dividends declared (in dollars per share)	$ 0.2875	$ 0.2875	$ 0.2875	$ 0.2375	$ 0.2375	$ 0.2375	$ 0.8625	$ 0.7125

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Basis of Presentation and Significant Accounting Policies

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation and Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial statements of Choice Hotels International, Inc. and subsidiaries (collectively, "Choice" or the "Company") have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). All significant intercompany accounts and transactions between the Company and its subsidiaries have been eliminated in consolidation.

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments that are necessary to fairly present the Company's financial position and results of operations. Except as otherwise disclosed, all adjustments are of a normal recurring nature.

Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been omitted. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2022 and the notes thereto included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on March 1, 2023. Interim results are not necessarily indicative of the entire year's results.

Acquisition of Radisson Hotels Americas

On August 11, 2022, the Company completed the acquisition (the "Transaction") of (1) all of the issued and outstanding shares of Radisson Hospitality, Inc. and (2) certain trademarks held by Radisson Hospitality Belgium BV/SRL (collectively referred to as "Radisson Hotels Americas").

The Company determined that it was the accounting acquirer of Radisson Hotels Americas and accounted for the Transaction as a business combination using the acquisition method of accounting. Accordingly, the assets acquired and the liabilities assumed were recorded at their fair values as of the August 11, 2022 acquisition date, with the exception of certain assets and liabilities which were accounted for in accordance with the provisions of ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08"). The Company finalized the purchase price allocation for the Transaction in the third quarter of 2023. Refer to Note 14.

The Company's consolidated statements of income include Radisson Hotels Americas' results of operations in the three and nine months ended September 30, 2023, but our consolidated statements of income only partially include Radisson Hotels Americas' results of operations in the three and nine months ended September 30, 2022 because the Company did not acquire Radisson Hotels Americas until August 11, 2022.

Summary of Significant Accounting Policies

The Company’s significant accounting policies are detailed in the “Summary of Significant Accounting Policies” section of Note 1 in the Annual Report on Form 10-K for the year ended December 31, 2022.

Recently Adopted Accounting Standards

In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses ("ASU 2022-02"). ASU 2022-02 eliminates the recognition and measurement guidance on troubled debt restructuring for creditors that have adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) ("Topic 326"), requires enhanced disclosures about loan modifications for borrowers experiencing financial difficulty, and includes new guidance on current-period gross write-offs presentation. ASU 2022-02 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. The Company adopted ASU 2022-02 on a prospective basis effective January 1, 2023, and concluded there is no material impact to the consolidated financial statements or disclosures through the third quarter of 2023.

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Revenue

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Contract Liabilities

Contract liabilities relate to (i) advance consideration received related to services considered to be a part of the brand intellectual property performance obligation, such as initial franchise fees that are paid when a franchise agreement is executed and system implementation fees that are paid at the time of installation, and (ii) amounts received when loyalty points are issued but the associated revenue has not yet been recognized since the related loyalty points have not been redeemed.

Deferred revenues from initial fees and system implementation fees are typically recognized over a five- to ten-year period, unless the franchise agreement is terminated and the hotel exits the franchise system whereby remaining deferred amounts are recognized to revenue in the period of termination. Loyalty points are typically redeemed within three years of issuance.

The following table summarizes the significant changes in the contract liabilities balances during the period from December 31, 2022 to September 30, 2023:

(in thousands)
Balance as of December 31, 2022	$	209,359
Increases to the contract liability balance due to cash received	105,305
Revenue recognized in the period	(99,475)
Balance as of September 30, 2023	$	215,189

Remaining Performance Obligations

The aggregate amount of the transaction price that is allocated to unsatisfied, or partially unsatisfied, performance obligations was $215.2 million as of September 30, 2023. This amount represents the fixed transaction price that will be recognized as revenue in future periods, which is presented as current and non-current deferred revenue in the consolidated balance sheets.

Based on the practical expedient elections permitted by ASU 2014-09, Revenue From Contracts with Customers (Topic 606) and subsequent amendments ("Topic 606"), the Company does not disclose the value of unsatisfied performance obligations for (i) variable consideration subject to the sales or usage-based royalty constraint or comprising a component of a series (including franchise, partnership, qualified vendor, and software as a service ("SaaS") agreements), (ii) variable consideration for which we recognize revenue at the amount to which we have the right to invoice for services performed, or (iii) contracts with an expected original duration of one year or less.

Disaggregation of Revenue

	Three Months Ended						Three Months Ended
	September 30, 2023						September 30, 2022
(in thousands)	Over time		Point in time		Total		Over time		Point in time		Total
Royalty, licensing and management fees	$	145,830	$	2,682	$	148,512	$	143,987	$	33	$	144,020
Initial franchise fees	6,194		—		6,194		7,011		—		7,011
Platform and procurement services fees	14,874		668		15,542		13,628		773		14,401
Owned hotels	19,497		6,742		26,239		14,877		5,115		19,992
Other	11,436		—		11,436		31,432		—		31,432
Other revenues from franchised and managed properties	200,399		17,235		217,634		178,349		19,061		197,410
Total revenues	$	398,230	$	27,327	$	425,557	$	389,284	$	24,982	$	414,266
	Nine Months Ended						Nine Months Ended
	September 30, 2023						September 30, 2022
(in thousands)	Over time		Point in time		Total		Over time		Point in time		Total
Royalty, licensing and management fees	$	389,332	$	7,171	$	396,503	$	356,175	$	33	$	356,208
Initial franchise fees	21,240		—		21,240		21,635		—		21,635
Platform and procurement services fees	56,112		2,074		58,186		45,503		2,384		47,887
Owned hotels	55,544		18,531		74,075		39,720		9,500		49,220
Other	33,211		—		33,211		51,588		—		51,588
Other revenues from franchised and managed properties	546,332		56,222		602,554		438,734		74,695		513,429
Total revenues	$	1,101,771	$	83,998	$	1,185,769	$	953,355	$	86,612	$	1,039,967

The owned hotels revenues that are recognized at a point in time represent the goods and services that are purchased independently of the hotel stay, such as food and beverage, incidentals, and parking fees. The remaining revenues that are recognized at a point in time represent the loyalty points that are redeemed by members for benefits (with both franchisees and third-party partners), net of the cost of redemptions.

During the three and nine months ended September 30, 2022, Other revenues included contract termination fee revenue of $22.7 million from the exit of 110 WoodSpring units in September 2022. The contract termination fee revenue consisted of $67.4 million in consideration, less the $44.7 million in intangible assets that were initially recognized on the date of the WoodSpring acquisition.

As presented in Note 11, the Corporate & Other segment revenue amounts are $33.8 million and $29.7 million for the three months ended September 30, 2023 and 2022, respectively, and $86.5 million and $63.4 million for the nine months ended September 30, 2023 and 2022, respectively, and are primarily included in Other revenue and Owned hotels revenue in the consolidated statements of income. The remaining revenues relate to the Hotel Franchising & Management reportable segment.

Royalty, licensing and management fees and Other revenues from franchised and managed properties are presented net of intersegment revenues of $4.0 million and $1.6 million for the three months ended September 30, 2023 and 2022, respectively, and $7.3 million and $3.7 million for the nine months ended September 30, 2023 and 2022, respectively.

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Receivables and Allowance for Credit Losses

9 Months Ended

Sep. 30, 2023

Accounts and Financing Receivable, after Allowance for Credit Loss [Abstract]

Receivables and Allowance for Credit Losses

Receivables and Allowance for Credit Losses

Notes Receivable

The Company has provided financing in the form of notes receivable loans to franchisees to support the development of hotel properties in strategic markets. The Company's credit quality indicator is the level of security in the note receivable.

The following table summarizes the composition of the notes receivable balances by credit quality indicator and the allowance for credit losses:

(in thousands)	September 30, 2023		December 31, 2022
Senior	$	86,374	$	95,466
Subordinated	19,592		17,075
Unsecured	4,980		5,674
Total notes receivable	$	110,946	$	118,215
Less: allowance for credit losses	8,389		10,172
Total notes receivable, net of allowance for credit losses	$	102,557	$	108,043
Current portion, net of allowance for credit losses	$	52,726	$	52,466
Long-term portion, net of allowance for credit losses	$	49,831	$	55,577

The following table summarizes the amortized cost basis of the notes receivable by the year of origination and credit quality indicator:

(in thousands)	2023		2022		2021		2020		2019		Prior		Total
Senior	$	—	$	—	$	—	$	—	$	29,083	$	57,291	$	86,374
Subordinated	3,493		—		1,994		—		—		14,105		19,592
Unsecured	—		215		1,292		903		208		2,362		4,980
Total notes receivable	$	3,493	$	215	$	3,286	$	903	$	29,291	$	73,758	$	110,946

The following table summarizes the activity related to the Company’s notes receivable allowance for credit losses:

(in thousands)	September 30, 2023		December 31, 2022
Beginning balance	$	10,172	$	16,779
Provision for credit losses	154		(938)
Recoveries	(1,937)		(5,669)
Ending balance	$	8,389	$	10,172

As of both September 30, 2023 and December 31, 2022, one note receivable loan with a senior credit quality indicator met the definition of collateral-dependent and is collateralized by membership interests in the borrowing entities and the associated land parcel. The Company used a market approach using quoted market prices to value the underlying collateral. The Company reviewed the borrower's financial statements, economic trends, industry projections for the market, and comparable sales capitalization rates, which represent significant inputs to the cash flow projections. These nonrecurring fair value measurements are classified as Level 3 in the fair value measurement hierarchy because they are unobservable inputs which are significant to the overall fair value. Based on the Company's analysis, the fair value of the collateral secures substantially all of the carrying value of the loan. The allowances for credit losses attributable to collateral-dependent loans are $0.9 million as of both September 30, 2023 and December 31, 2022, respectively.

Recoveries during the nine months ended September 30, 2023 were primarily associated with cash collections pursuant to a settlement agreement with a borrower. Recoveries during the year ended December 31, 2022 were primarily associated with a loan that was previously classified as collateral-dependent and was settled in exchange for an operating hotel on April 14, 2022.

The Company considers loans past due and in default when payments are not made when due in accordance with the then-current loan provisions or the terms extended to the borrowers, including loans with concessions or interest deferral. The Company suspends the accrual of interest when payments on loans are more than 30 days past due or upon a loan being classified as collateral-dependent. The Company applies the payments received for loans on a non-accrual status first to interest and then to principal. The Company does not resume an interest accrual until all delinquent payments are received based on the then-current loan provisions. The amortized cost basis of the notes receivable in a non-accrual status was $16.5 million and $18.7 million as of September 30, 2023 and December 31, 2022, respectively.

The Company has notes receivable loans totaling approximately $4.4 million and $4.8 million as of September 30, 2023 and December 31, 2022, respectively, with stated interest rates that are lower than market interest rates, representing a total unamortized discount of less than $0.1 million as of both September 30, 2023 and December 31, 2022. These discounts are reflected as a reduction of the outstanding notes receivable loan amounts and are amortized over the life of the related loan.

The following table summarizes the past due balances by credit quality indicator of the notes receivable:

(in thousands)	1- 30 days Past Due		31-89 days Past Due		> 90 days Past Due		Total Past Due		Current		Total  Notes Receivable
As of September 30, 2023
Senior	$	—	$	—	$	44,283	$	44,283	$	42,091	$	86,374
Subordinated	—		—		271		271		19,321		19,592
Unsecured	—		—		400		400		4,580		4,980
	$	—	$	—	$	44,954	$	44,954	$	65,992	$	110,946
As of December 31, 2022
Senior	$	—	$	15,200	$	—	$	15,200	$	80,266	$	95,466
Subordinated	—		—		2,209		2,209		14,866		17,075
Unsecured	20		40		40		99		5,575		5,674
	$	20	$	15,240	$	2,249	$	17,508	$	100,707	$	118,215

Variable Interest through Notes Issued

The Company has issued notes receivable loans to certain entities that have created variable interests in the associated borrowers totaling $98.4 million and $103.2 million as of September 30, 2023 and December 31, 2022, respectively. The Company has determined that it is not the primary beneficiary of these variable interest entities ("VIEs").

Accounts Receivable

Accounts receivable consists primarily of franchise and related fees due from the hotel franchisees and are recorded at the invoiced amount.

During the nine months ended September 30, 2023, the Company recognized provisions for credit losses on accounts receivable of $4.2 million in selling, general and administrative ("SG&A") expenses and $4.0 million in other expenses from franchised and managed properties. During the nine months ended September 30, 2022, the Company recognized a reversal of provisions for credit losses on accounts receivable of $0.4 million in SG&A expenses and provisions for credit losses on accounts receivable of $0.5 million in other expenses from franchised and managed properties. During the nine months ended September 30, 2023 and 2022, the Company recorded write-offs, net of recoveries, through the accounts receivable allowance for credit losses of $2.8 million and $12.9 million, respectively.

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Investments in Affiliates

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Investments in Affiliates

Investments in Affiliates

The Company has equity method investments in affiliates primarily related to the Company's program to offer equity support to qualified franchisees to develop and operate Everhome Suites and Cambria Hotels in strategic markets.

As of September 30, 2023 and December 31, 2022, the Company had total investments in affiliates in the consolidated balance sheets of $55.1 million and $30.6 million, respectively, which included investments in affiliates that represent VIEs of $45.3 million and $24.4 million, respectively. The Company has determined that it is not the primary beneficiary of any of these VIEs, however the Company does exercise significant influence through its equity ownership and as a result, the investments in these affiliates are accounted for under the equity method. During the three months ended September 30, 2023 and 2022, the Company recognized losses totaling $0.9 million and $1.1 million, respectively, from these investments that represent VIEs. During the nine months ended September 30, 2023 and 2022, the Company recognized losses totaling $3.2 million and $2.7 million, respectively, from these investments that represent VIEs. The Company's maximum exposure to losses related to its investments in the VIEs is limited to the total of its respective equity investment as well as certain limited payment guaranties, which are described in Note 12 of these consolidated financial statements.

The Company recognized no impairment charges related to its equity method investments during the nine months ended September 30, 2023 and 2022.

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Debt

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Debt

Debt

Debt consists of the following:

	September 30, 2023		December 31, 2022
	(in thousands)
$450 million senior unsecured notes due 2031 ("2020 Senior Notes") with an effective interest rate of 3.86%, less a discount and deferred issuance costs of $4.5 million and $4.9 million at September 30, 2023 and December 31, 2022, respectively	$	445,537	$	445,080
$400 million senior unsecured notes due 2029 ("2019 Senior Notes") with an effective interest rate of 3.88%, less a discount and deferred issuance costs of $3.7 million and $4.2 million at September 30, 2023 and December 31, 2022, respectively	396,290		395,838
$850 million senior unsecured revolving credit facility with an effective interest rate of 6.40% less deferred issuance costs of $2.1 million and $1.8 million at September 30, 2023 and December 31, 2022, respectively (1)	549,445		358,189
Economic development loans with an effective interest rate of 3.00% at September 30, 2023 and December 31, 2022, respectively	4,416		4,416
Total debt	$	1,395,688	$	1,203,523
Less current portion	4,416		2,976
Long-term debt	$	1,391,272	$	1,200,547

(1) On February 14, 2023, the Company entered into a Third Amendment to the Amended and Restated Senior Unsecured Credit Agreement (the "Amendment"). The Amendment provides, among other things, for (i) an increase in the aggregate amount of commitments under the Company's existing $600 million unsecured credit facility (the "Revolver") by $250 million (the “Increased Commitments”) to an aggregate amount of $850 million and (ii) the replacement of the interest reference rate for U.S. dollar-denominated borrowings under the Revolver from the London Interbank Offered Rate ("LIBOR") to an adjusted Secured Overnight Financing Rate ("SOFR"). The pricing and other terms applicable to the Increased Commitments are the same as those applicable to the existing revolving loan commitments that were in effect prior to the Amendment. Except as amended by the Amendment, the remaining terms of the unsecured credit facility remain in full force and effect.

Refer to Note 12 and the Liquidity and Capital Resources section of "Management's Discussion and Analysis of Financial Condition and Results of Operations" for more information.

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Accumulated Other Comprehensive Loss

9 Months Ended

Sep. 30, 2023

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2023 and 2022 were as follows:

(in thousands)
Balance as of December 31, 2022	$	(5,211)
Other comprehensive income (loss) before reclassification	498
Balance as of September 30, 2023	$	(4,713)

(in thousands)
Balance as of December 31, 2021	$	(4,574)
Other comprehensive income (loss) before reclassification	(1,139)
Balance as of September 30, 2022	$	(5,713)

The other comprehensive income (loss) before reclassification for both the nine months ended September 30, 2023 and 2022 relate to foreign currency items, and there were no amounts reclassified from accumulated other comprehensive loss during either period.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Company estimates the fair value of its financial instruments utilizing a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The following summarizes the three levels of inputs, as well as the assets that the Company values using those levels of inputs on a recurring basis.

Level 1: Quoted prices in active markets for identical assets and liabilities. The Company’s Level 1 assets consist of marketable securities (primarily mutual funds) held in the Company's Deferred Compensation Plan.

Level 2: Observable inputs, other than quoted prices in active markets for identical assets and liabilities, such as quoted prices for similar assets and liabilities, quoted prices in markets that are not active, or other inputs that are observable. The Company’s Level 2 assets consist of money market funds held in the Company's Deferred Compensation Plan.

Level 3: Unobservable inputs, supported by little or no market data available, where the reporting entity is required to develop its own assumptions to determine the fair value of the instrument. The Company does not currently have any assets recorded at fair value on a recurring basis whose fair value was determined using Level 3 inputs and there were no transfers of Level 3 assets during the nine months ended September 30, 2023 and year ended December 31, 2022.

As of September 30, 2023 and December 31, 2022, the Company recognized the following assets at fair value on a recurring basis in the consolidated balance sheets:

	Fair Value Measurements at Reporting Date Using
(in thousands)	Total		Level 1		Level 2		Level 3
As of September 30, 2023
Mutual funds (1)	$	33,216	$	33,216	$	—	$	—
Money market funds (1)	4,568		—		4,568		—
Total	$	37,784	$	33,216	$	4,568	$	—
As of December 31, 2022
Mutual funds (1)	$	29,143	$	29,143	$	—	$	—
Money market funds (1)	3,242		—		3,242		—
Total	$	32,385	$	29,143	$	3,242	$	—

(1) The current assets at fair value noted above are presented in Prepaid expenses and other assets, and the long-term assets at fair value noted above are presented in Investments for employee benefit plans, at fair value, in the consolidated balance sheets.

Other financial instruments disclosure

The Company believes that the fair values of its current assets and current liabilities approximate their reported carrying amounts due to the short-term nature of these items. In addition, the interest rate on the senior unsecured revolving credit facility adjusts frequently based on current market interest rates; accordingly, the Company believes the carrying amount approximates fair value.

The fair values of the Company's senior unsecured notes are classified as Level 2 because the significant inputs are observable in an active market. Refer to Note 5 for further information on debt. As of September 30, 2023 and December 31, 2022, the carrying amounts and the fair values were as follows:

	September 30, 2023				December 31, 2022
(in thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
2020 Senior Notes	$	445,537	$	374,882	$	445,080	$	384,647
2019 Senior Notes	396,290		345,196		395,838		349,368

The fair value estimates are made at a specific point in time, are subjective in nature, and involve uncertainties and matters of significant judgment. The settlement of such fair value amounts may not be possible or a prudent management decision.

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Income Taxes

9 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The effective income tax rates were 24.1% and 24.6% for the three months ended September 30, 2023 and 2022, respectively. The effective income tax rates were 23.8% and 24.5% for the nine months ended September 30, 2023 and 2022, respectively.

The effective income tax rates for the three and nine months ended September 30, 2023 and 2022 were higher than the U.S. federal income tax rate of 21% primarily due to the impact of state income taxes.

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Share-Based Compensation and Capital Stock

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Share-Based Compensation and Capital Stock

Share-Based Compensation and Capital Stock The components of the Company’s share-based compensation expense for the three and nine months ended September 30, 2023 and 2022 were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2023		2022		2023		2022
Stock options	$	1,422	$	1,216	$	4,562	$	3,445
Restricted stock awards	3,305		3,763		10,362		10,364
Performance vested restricted stock units	5,261		4,887		17,041		13,051
Total share-based compensation expense	$	9,988	$	9,866	$	31,965	$	26,860

A summary of the share-based award activity during the nine months ended September 30, 2023 is presented below:

	Stock Options				Restricted Stock			Performance Vested Restricted Stock Units
	Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Outstanding at January 1, 2023	1,010,647	$	94.97		399,099	$	128.47	437,180	$	140.05
Granted	88,733	123.62			64,216	123.95		109,786	127.82
Performance-Based Leveraging (1)	—	—			—	—		64,717	138.51
Exercised/Vested	(126,556)	57.04			(85,551)	94.82		(119,751)	145.41
Expired	—	—			—	—		—	—
Forfeited	(8,660)	126.49			(10,370)	116.26		(12,365)	134.36
Outstanding at September 30, 2023	964,164	$	102.30	5.9	367,394	$	135.87	479,567	$	136.11
Stock options exercisable at September 30, 2023	581,426	$	90.42	4.4

(1) Any revisions to the outstanding PVRSUs during the nine months ended September 30, 2023 is based on the Company's performance relative to the targeted performance conditions in the respective PVRSUs.

The fair value of the restricted stock awards and the PVRSUs with performance conditions that were granted during the nine months ended September 30, 2023 was equal to the market price of the Company’s common stock on the date of grant. The fair value of the PVRSUs with market conditions based on the Company’s total shareholder return relative to a predetermined peer group was estimated using a Monte Carlo simulation method as of the grant date. The requisite service periods for the restricted stock and PVRSUs was between 9 months and 48 months. PVRSU awards have vesting ranges between 0% and 230% of the initial units granted.

The stock options granted by the Company had an exercise price equal to the market price of the Company's common stock on the date of grant. The fair value of the options granted during the nine months ended September 30, 2023 was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions:

Risk-free interest rate	4.10		%
Expected volatility	30.90		%
Expected life of the stock option	6.0 years
Dividend yield	0.9		%
Requisite service period	4 years
Contractual life	10 years
Weighted average fair value of the stock options granted (per stock option)	$	42.59

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Earnings Per Share

9 Months Ended

Sep. 30, 2023

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share The Company’s shares of restricted stock contain rights to receive nonforfeitable dividends and thus are participating securities requiring the computation of basic Earnings per Share ("EPS") using the two-class method. The shares of restricted stock are both potential shares of common stock and participating securities so the Company calculates diluted earnings per share by using the more dilutive of the treasury stock method or the two-class method. The calculation of EPS for the net income available to common shareholders excludes the distribution of dividends and the undistributed earnings attributable to the participating securities from the numerator. The diluted earnings weighted average shares of common stock outstanding includes stock options, PVRSUs and RSUs.

The computation of basic and diluted earnings per share of common stock was as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in thousands, except per share amounts)	2023		2022		2023		2022
Numerator:
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Income allocated to participating securities	(479)		(614)		(1,235)		(1,526)
Net income available to common shareholders	$	91,545	$	102,466	$	228,319	$	275,113
Denominator:
Weighted average shares of common stock outstanding – basic	50,041		54,847		50,641		55,233
Basic earnings per share	$	1.83	$	1.87	$	4.51	$	4.98
Numerator:
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Income allocated to participating securities	(479)		(614)		(1,235)		(1,526)
Net income available to common shareholders	$	91,545	$	102,466	$	228,319	$	275,113
Denominator:
Weighted average shares of common stock outstanding – basic	50,041		54,847		50,641		55,233
Dilutive effect of stock options, PVRSUs, and RSUs	430		395		413		520
Weighted average shares of common stock outstanding – diluted	50,471		55,242		51,054		55,753
Diluted earnings per share	$	1.81	$	1.85	$	4.47	$	4.93

The following securities have been excluded from the calculation of diluted weighted average shares of common stock outstanding because the inclusion of these securities would have an anti-dilutive effect:

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(in thousands)	2023	2022	2023	2022
Stock options	150	170	233	154
PVRSUs	—	75	—	75

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Reportable Segment Information

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Reportable Segment Information

Reportable Segment Information

The Hotel Franchising & Management reportable segment includes the Company's hotel franchising operations consisting of its 22 brands and brand extensions and hotel management operations of 13 Radisson Hotels Americas hotels (inclusive of 3 owned hotels). The 22 brands and brand extensions and the hotel management operations are aggregated together within this reportable segment because of their 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, procurement services revenue, 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 and management revenues and are offset by the related expenses in order to calculate hotel franchising and 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 results of the segment without allocating corporate expenses, indirect general and administrative expenses, interest expense, interest income, other gains and losses, and income taxes, all of which are included in the Corporate & Other column. Corporate & Other revenues include owned hotel revenues and the revenues related to the Company's SaaS technology solutions division which provides cloud-based property management software to non-franchised hotel properties.

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, does not use assets by operating segment when assessing performance or when making operating segment resource allocation decisions and therefore, assets by segment are not disclosed below.

The following table presents the financial information for the Company's segments:

	Three Months Ended September 30, 2023								Three Months Ended September 30, 2022
(in thousands)	Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated		Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated
Revenues	$	395,742	$	33,832	$	(4,017)	$	425,557	$	386,124	$	29,692	$	(1,550)	$	414,266
Operating income (loss)	$	167,459	$	(32,417)	$	—	$	135,042	$	161,084	$	(16,066)	$	—	$	145,018
Income (loss) before income taxes	$	169,260	$	(48,031)	$	—	$	121,229	$	162,162	$	(25,386)	$	—	$	136,776
	Nine Months Ended September 30, 2023								Nine Months Ended September 30, 2022
(in thousands)	Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated		Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated
Revenues	$	1,106,643	$	86,464	$	(7,338)	$	1,185,769	$	980,352	$	63,363	$	(3,748)	$	1,039,967
Operating income (loss)	$	422,881	$	(85,599)	$	—	$	337,282	$	433,852	$	(32,088)	$	—	$	401,764
Income (loss) before income taxes	$	424,804	$	(123,533)	$	—	$	301,271	$	435,131	$	(68,494)	$	—	$	366,637

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Company is not a party to any litigation other than litigation in the ordinary course of business. The Company's management and legal counsel do not expect that the ultimate outcome of any of its currently ongoing legal proceedings, individually or collectively, will have a material adverse effect on the Company's financial position, results of operations or cash flows.

Contingencies

The Company entered into various limited payment guaranties with regards to the Company’s VIEs in order to support their efforts to develop and own hotels that are franchised under the Company’s brands. Under these limited payment guaranties, the Company has agreed to guarantee a portion of the outstanding debt until certain conditions are met, such as (a) the loan matures, (b) certain debt covenants are achieved, (c) the maximum amount guaranteed by the Company is paid in full, or (d) the Company, through its affiliates, ceases to be a member of the VIE. As of September 30, 2023, the maximum unrecorded exposure of principal incidental to these limited payment guaranties is $4.5 million, plus unpaid expenses and accrued unpaid interest. The Company believes the likelihood of having to perform under these guaranties is remote. In the event of performance, the Company has recourse for certain of the guaranties in the form of partial guaranties from third parties.

Commitments

The Company has the following outstanding commitments as of September 30, 2023:

•The Company provides financing in the form of franchise agreement acquisition payments to franchisees for property improvements, hotel development efforts and other purposes. These payments are typically made at the commencement of construction or hotel opening, in accordance with agreed upon provisions in the individual franchise agreements. As of September 30, 2023, the Company had commitments for an additional $350.3 million in franchise agreement acquisition payments, provided the conditions for the payments are met by the franchisees.

•As part of the acquisition of Radisson Hotels Americas, the Company entered into a long-term management arrangement, with an expiration date of July 31, 2031, to manage eight hotels owned by a third-party. In conjunction with the management arrangement, the Company entered into a guarantee with the third-party to fund any shortfalls in the payment of the third-party owner’s priority that is stipulated in the management agreement. The maximum guarantee under the agreement is $22 million. The Company believes the future performance of the hotels is expected to be sufficient on both an annual basis and over the duration of the agreement. Accordingly, no liability was recognized as of September 30, 2023 in the consolidated balance sheets.

•The Company’s legacy Choice franchise agreements require the payment of franchise fees, which include marketing and reservation system fees. In accordance with the terms of our legacy Choice franchise agreements, the Company is obligated to use the marketing and reservation system revenues it collects from the current franchisees to provide marketing and reservation services that are appropriate to support the operation of the overall system. The legacy Radisson Hotels Americas franchise agreements have similar provisions regarding the marketing fees that need to be used for marketing activities. To the extent the revenues collected exceed the expenditures incurred, the Company has a commitment to the franchisee system to make expenditures in future years. Conversely, to the extent the expenditures incurred exceed the revenues collected, the Company has the contractual enforceable right to assess and collect such amounts from the franchisees.

In the ordinary course of business, the Company enters into numerous agreements that contain standard indemnities whereby the Company indemnifies another party for breaches of representations and warranties. Such indemnifications are granted under various agreements, including those governing (i) purchases or sales of assets or businesses, (ii) leases of real estate, (iii) licensing of trademarks, (iv) access to credit facilities, (v) issuances of debt or equity securities, and (vi) certain operating agreements. The indemnifications issued are for the benefit of the (i) buyers in sale agreements and sellers in purchase agreements, (ii) landlords in lease contracts, (iii) franchisees in licensing agreements, (iv) financial institutions in credit facility arrangements, (v) underwriters in debt or equity security issuances, and (vi) parties under certain operating agreements. In addition, these parties are also generally indemnified against any third-party claim resulting from the transaction that is contemplated in the underlying agreement. While some of these indemnities extend only for the duration of the underlying agreement, many survive the expiration of the term of the agreement or extend into perpetuity (unless subject to a legal statute of limitations). There are no specific limitations on the maximum potential amount of future payments that the Company could be required to make under these indemnities, nor is the Company able to develop an estimate of the maximum potential amount of the future payments that could be made under these indemnifications as the triggering events are not subject to predictability. With respect to certain of the aforementioned indemnities, such as the indemnifications of the landlords against third-party claims for the use of real estate property leased by the Company, the Company maintains insurance coverage that mitigates potential liability.

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Transactions with Unconsolidated Affiliates

9 Months Ended

Sep. 30, 2023

Equity Method Investments and Joint Ventures [Abstract]

Transactions with Unconsolidated Affiliates

Transactions with Unconsolidated Affiliates

The Company has management fee arrangements with certain of its unconsolidated affiliates that are discussed in Note 4. The fees earned and the payroll costs reimbursed under these arrangements totaled $2.4 million and $0.8 million for the three months ended September 30, 2023 and 2022, respectively, and $6.1 million and $1.7 million for the nine months ended September 30, 2023 and 2022, respectively.

The Company has entered into franchise agreements with certain unconsolidated affiliates. Pursuant to these franchise agreements, for the three months ended September 30, 2023 and 2022, the Company recognized royalty and marketing reservation system fees of approximately $9.4 million and $8.9 million, respectively. For the nine months ended September 30, 2023 and 2022, the Company recognized royalty and marketing reservation fees of approximately $23.1 million and $19.5 million, respectively. The Company recognized $5.2 million and $3.9 million as a receivable from these affiliates as of September 30, 2023 and December 31, 2022, respectively.

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Acquisitions

9 Months Ended

Sep. 30, 2023

Business Combination and Asset Acquisition [Abstract]

Acquisitions

Acquisitions

Radisson Hotels Americas Acquisition

On August 11, 2022, the Company completed the acquisition of Radisson Hotels Americas. The accounting purchase price for the Transaction was $673.9 million, which includes the base purchase price of $675.2 million and then adjusted for Disclosed Leakage (as defined in the Share Sale and Purchase Agreement) and certain other prepaid expenses. To fund the Transaction, Choice drew down $175.0 million on the Company's existing senior unsecured credit facility and then funded the remainder with cash on hand.

In connection with the acquisition, we recognized $10.9 million and $30.6 million during the three and nine months ended September 30, 2023, respectively, and $24.9 million and $29.0 million during the three and nine months ended September 30, 2022, respectively, of transaction, transition, and severance expenses which are included within Selling, general and administrative in the consolidated statements of income.

Fair Values of the Assets Acquired and the Liabilities Assumed

The Company allocated the purchase price based upon a preliminary assessment of the fair value of the assets acquired and the liabilities assumed on August 11, 2022. During the fourth quarter of 2022 and the first quarter of 2023, the Company recorded certain net measurement period adjustments that reduced goodwill by $9.1 million and increased goodwill by $1.5 million, respectively, which is presented in the table below. The Company made these measurement period adjustments to reflect the

facts and circumstances that existed as of the acquisition date and did not result from any intervening events subsequent to the acquisition date. The measurement period adjustments resulted in no impact to our consolidated statements of income.

The final valuation and related allocation of the purchase price was completed in the third quarter of 2023.

The final allocation of the purchase price, including all measurement period adjustments, as presented in our consolidated balance sheets is as follows:

(in thousands)	August 11, 2022 - original		Measurement Period Adj - 4th quarter 2022		Measurement Period Adj - 1st quarter 2023		August 11, 2022 - as adjusted
Cash and cash equivalents	$	113,023	$	—	$	—	$	113,023
Restricted cash	10,403		—		—		10,403
Accounts receivable	32,972		8,752		(1,941)		39,783
Notes receivable - current	1,709		—		(860)		849
Prepaid expenses and other current assets	8,139		—		—		8,139
Property and equipment	125,441		—		—		125,441
Operating lease right-of-use of assets	42,315		(2,016)		—		40,299
Intangible assets	447,400		(300)		—		447,100
Notes receivable - noncurrent	2,592		—		—		2,592
Investment in affiliates	471		—		—		471
Other assets	2,129		—		—		2,129
Total assets acquired	$	786,594	$	6,436	$	(2,801)	$	790,229
Accounts payable	$	8,295	$	(1,566)	$	(1,941)	$	4,788
Accrued expenses and other current liabilities	15,987		425		674		17,086
Deferred revenue - current(1)	5,745		1,566		—		7,311
Liability for guest loyalty program - current(1)	3,542		3,792		—		7,334
Long-term debt	55,975		—		—		55,975
Long-term deferred revenue(1)	26,499		(3,915)		—		22,584
Deferred compensation and retirement plan obligations	9,265		—		—		9,265
Operating lease liabilities	42,705		(2,016)		—		40,689
Liability for guest loyalty program - noncurrent(1)	10,180		(1,443)		—		8,737
Other liabilities	3,052		543		—		3,595
Total liabilities assumed	$	181,245	$	(2,614)	$	(1,267)	$	177,364
Fair value of net assets acquired	$	605,349	$	9,050	$	(1,534)	$	612,865
Goodwill	68,507		(9,050)		1,534		60,991
Total purchase consideration	$	673,856	$	—	$	—	$	673,856

(1) The Deferred revenue (including deferred affiliation fees) and Liability for guest loyalty program balances were assumed at their carrying value on the date of the acquisition pursuant to the application of ASU 2021-08. Refer to Note 1

Property and Equipment

The following table presents the estimated fair value of the acquired property and equipment, which is primarily concentrated at three acquired hotel properties, and their estimated weighted average remaining useful lives.

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Land	N/A	$	7,159
Construction in progress	N/A	3,190
Building and leasehold improvements	24.4	93,934
Site improvements	23.1	586
Furniture, fixtures and equipment	3.9	8,334
Computer equipment and software	2.0	12,238
Total property and equipment		$	125,441

We estimated the value of the property and equipment through a combination of income, cost and market approaches, which are primarily based on significant Level 2 and Level 3 assumptions, such as estimates of future income growth, discount rates, capitalization rates and capital expenditure needs of the hotel properties.

Identified Intangible Assets

The following table presents the estimated fair values of the acquired identified intangible assets and their estimated useful lives:

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Trade names	N/A	$	223,700
Franchise agreements	15.5	220,100
Management agreements	15.5	3,300
Total intangible assets		$	447,100

The fair value of the trade names was estimated using the relief-from-royalty method. This method applies an estimated royalty rate to the forecasted future cash flows and discounted to the present value. The fair value of the franchise and management agreements was estimated using a multi-period excess earnings method, which is a variation of the income approach. This method uses the present value of the incremental after-tax cash flows attributable to the intangible asset. These valuation methodologies utilize Level 3 assumptions.

Debt Assumed

As part of the Transaction, we assumed a mortgage loan related to an acquired hotel property. The mortgage loan had an associated interest rate cap agreement with an effective date of July 30, 2021 through August 6, 2024. Subsequent to the acquisition date, the mortgage loan and the outstanding interest and fees, was repaid in full in the amount of $56.0 million using cash we acquired in the Transaction. Additionally, the interest rate cap agreement was terminated, which resulted in a $1.9 million payment to Choice. In conjunction with assuming the mortgage loan, we acquired $10.4 million in restricted cash, for which the restrictions were lifted upon repayment of the mortgage loan.

Operating Leases

The Company measured the assumed operating lease liabilities at the present value of the remaining payments as of the acquisition date, which were discounted using Choice's applicable incremental borrowing rate in accordance with Leases (Topic 842). The corresponding acquired right-of-use assets were measured at the value of the operating lease liabilities, and then further adjusted for favorable or unfavorable lease terms as compared to market lease terms.

Income Taxes

Pursuant to the terms of the Transaction, the parties agree to jointly make a valid, timely election under Section 338(h)(10) of the U.S. Internal Revenue Code and under any similar provisions of state or local law with respect to the purchase of the shares of Radisson Hotels Americas. Under this election, the parties agreed to treat the Transaction for federal income tax purposes as if it had been structured as an asset sale and purchase. As a result of this election, the tax basis of the assets acquired and the liabilities assumed by Choice were reset to fair value on the date of the acquisition, which results in the elimination of any

previously established deferred income tax balances and the establishment of new balances that reflect the new tax basis, including tax deductible goodwill.

Pro Forma Results of Operations

The following unaudited pro forma information presents the combined results of operations of Choice and Radisson Hotels Americas as if the Transaction was completed on January 1, 2021, but using the fair values of the assets acquired and the liabilities assumed as of the acquisition date. The unaudited pro forma information reflects adjustments relating to (i) the allocation of purchase price and related adjustments, including incremental depreciation and amortization expense based on the fair values of the acquired property and equipment and intangible assets, (ii) the incremental impact of the Revolver draw on interest expense and the amortization of financing costs, (iii) nonrecurring transaction costs, and (iv) the income tax impact of the aforementioned pro forma adjustments.

As required by GAAP, these unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the transaction had occurred at the beginning of the period presented, nor are they indicative of the future results of operations.

	Nine Months Ended
(in thousands)	September 30, 2022
Revenues	$	1,189,792
Net income	$	304,770

Radisson Hotels Americas Results of Operations

The Company's consolidated statements of income include Radisson Hotels Americas’ results of operations since the August 11, 2022 acquisition date. Radisson Hotels Americas contributed $40.2 million and $1.4 million in total revenues and net loss, respectively, for both the three and nine months ended September 30, 2022.

Goodwill

The $61.0 million of goodwill is primarily attributable to the value we expect to realize from the existing customer base, improvements in Revenue per Available Room ("RevPAR"), cost synergies, and new agreements signed with franchisees and developers. Goodwill for the Transaction is fully attributable to the Hotel Franchising & Management reportable segment and is fully deductible for tax purposes.

The following table details the carrying amount of the Company's goodwill, including the goodwill arising from the acquisition of Radisson Hotels Americas, as of September 30, 2023.

(in thousands)
Goodwill, excluding goodwill arising from Radisson Hotels Americas acquisition	$	166,774
Accumulated impairment losses	(7,578)
Goodwill arising from Radisson Hotels Americas acquisition	60,991
Goodwill, net carrying amount	$	220,187

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net income	$ 92,024	$ 84,710	$ 52,820	$ 103,080	$ 106,168	$ 67,391	$ 229,554	$ 276,639

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Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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Basis of Presentation and Significant Accounting Policies (Policy)

9 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements of Choice Hotels International, Inc. and subsidiaries (collectively, "Choice" or the "Company") have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). All significant intercompany accounts and transactions between the Company and its subsidiaries have been eliminated in consolidation.

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments that are necessary to fairly present the Company's financial position and results of operations. Except as otherwise disclosed, all adjustments are of a normal recurring nature.

Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been omitted. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2022 and the notes thereto included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on March 1, 2023. Interim results are not necessarily indicative of the entire year's results.

Recently Adopted Accounting Standards

Recently Adopted Accounting Standards

In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses ("ASU 2022-02"). ASU 2022-02 eliminates the recognition and measurement guidance on troubled debt restructuring for creditors that have adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) ("Topic 326"), requires enhanced disclosures about loan modifications for borrowers experiencing financial difficulty, and includes new guidance on current-period gross write-offs presentation. ASU 2022-02 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. The Company adopted ASU 2022-02 on a prospective basis effective January 1, 2023, and concluded there is no material impact to the consolidated financial statements or disclosures through the third quarter of 2023.

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Revenue (Tables)

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

Schedule of Contract with Customer, Liability

The following table summarizes the significant changes in the contract liabilities balances during the period from December 31, 2022 to September 30, 2023:

(in thousands)
Balance as of December 31, 2022	$	209,359
Increases to the contract liability balance due to cash received	105,305
Revenue recognized in the period	(99,475)
Balance as of September 30, 2023	$	215,189

Schedule of Disaggregation of Revenue

Disaggregation of Revenue

	Three Months Ended						Three Months Ended
	September 30, 2023						September 30, 2022
(in thousands)	Over time		Point in time		Total		Over time		Point in time		Total
Royalty, licensing and management fees	$	145,830	$	2,682	$	148,512	$	143,987	$	33	$	144,020
Initial franchise fees	6,194		—		6,194		7,011		—		7,011
Platform and procurement services fees	14,874		668		15,542		13,628		773		14,401
Owned hotels	19,497		6,742		26,239		14,877		5,115		19,992
Other	11,436		—		11,436		31,432		—		31,432
Other revenues from franchised and managed properties	200,399		17,235		217,634		178,349		19,061		197,410
Total revenues	$	398,230	$	27,327	$	425,557	$	389,284	$	24,982	$	414,266
	Nine Months Ended						Nine Months Ended
	September 30, 2023						September 30, 2022
(in thousands)	Over time		Point in time		Total		Over time		Point in time		Total
Royalty, licensing and management fees	$	389,332	$	7,171	$	396,503	$	356,175	$	33	$	356,208
Initial franchise fees	21,240		—		21,240		21,635		—		21,635
Platform and procurement services fees	56,112		2,074		58,186		45,503		2,384		47,887
Owned hotels	55,544		18,531		74,075		39,720		9,500		49,220
Other	33,211		—		33,211		51,588		—		51,588
Other revenues from franchised and managed properties	546,332		56,222		602,554		438,734		74,695		513,429
Total revenues	$	1,101,771	$	83,998	$	1,185,769	$	953,355	$	86,612	$	1,039,967

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Receivables and Allowance for Credit Losses (Tables)

9 Months Ended

Sep. 30, 2023

Accounts and Financing Receivable, after Allowance for Credit Loss [Abstract]

Schedule of Notes Receivable

The following table summarizes the composition of the notes receivable balances by credit quality indicator and the allowance for credit losses:

(in thousands)	September 30, 2023		December 31, 2022
Senior	$	86,374	$	95,466
Subordinated	19,592		17,075
Unsecured	4,980		5,674
Total notes receivable	$	110,946	$	118,215
Less: allowance for credit losses	8,389		10,172
Total notes receivable, net of allowance for credit losses	$	102,557	$	108,043
Current portion, net of allowance for credit losses	$	52,726	$	52,466
Long-term portion, net of allowance for credit losses	$	49,831	$	55,577

Schedule of Financing Receivable Credit Quality Indicators

The following table summarizes the amortized cost basis of the notes receivable by the year of origination and credit quality indicator:

(in thousands)	2023		2022		2021		2020		2019		Prior		Total
Senior	$	—	$	—	$	—	$	—	$	29,083	$	57,291	$	86,374
Subordinated	3,493		—		1,994		—		—		14,105		19,592
Unsecured	—		215		1,292		903		208		2,362		4,980
Total notes receivable	$	3,493	$	215	$	3,286	$	903	$	29,291	$	73,758	$	110,946

Schedule of Financing Receivable, Allowance for Credit Loss

The following table summarizes the activity related to the Company’s notes receivable allowance for credit losses:

(in thousands)	September 30, 2023		December 31, 2022
Beginning balance	$	10,172	$	16,779
Provision for credit losses	154		(938)
Recoveries	(1,937)		(5,669)
Ending balance	$	8,389	$	10,172

Schedule of Past Due Balances of Notes Receivable

The following table summarizes the past due balances by credit quality indicator of the notes receivable:

(in thousands)	1- 30 days Past Due		31-89 days Past Due		> 90 days Past Due		Total Past Due		Current		Total  Notes Receivable
As of September 30, 2023
Senior	$	—	$	—	$	44,283	$	44,283	$	42,091	$	86,374
Subordinated	—		—		271		271		19,321		19,592
Unsecured	—		—		400		400		4,580		4,980
	$	—	$	—	$	44,954	$	44,954	$	65,992	$	110,946
As of December 31, 2022
Senior	$	—	$	15,200	$	—	$	15,200	$	80,266	$	95,466
Subordinated	—		—		2,209		2,209		14,866		17,075
Unsecured	20		40		40		99		5,575		5,674
	$	20	$	15,240	$	2,249	$	17,508	$	100,707	$	118,215

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Debt (Tables)

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Schedule of Components of Debt

Debt consists of the following:

	September 30, 2023		December 31, 2022
	(in thousands)
$450 million senior unsecured notes due 2031 ("2020 Senior Notes") with an effective interest rate of 3.86%, less a discount and deferred issuance costs of $4.5 million and $4.9 million at September 30, 2023 and December 31, 2022, respectively	$	445,537	$	445,080
$400 million senior unsecured notes due 2029 ("2019 Senior Notes") with an effective interest rate of 3.88%, less a discount and deferred issuance costs of $3.7 million and $4.2 million at September 30, 2023 and December 31, 2022, respectively	396,290		395,838
$850 million senior unsecured revolving credit facility with an effective interest rate of 6.40% less deferred issuance costs of $2.1 million and $1.8 million at September 30, 2023 and December 31, 2022, respectively (1)	549,445		358,189
Economic development loans with an effective interest rate of 3.00% at September 30, 2023 and December 31, 2022, respectively	4,416		4,416
Total debt	$	1,395,688	$	1,203,523
Less current portion	4,416		2,976
Long-term debt	$	1,391,272	$	1,200,547

(1) On February 14, 2023, the Company entered into a Third Amendment to the Amended and Restated Senior Unsecured Credit Agreement (the "Amendment"). The Amendment provides, among other things, for (i) an increase in the aggregate amount of commitments under the Company's existing $600 million unsecured credit facility (the "Revolver") by $250 million (the “Increased Commitments”) to an aggregate amount of $850 million and (ii) the replacement of the interest reference rate for U.S. dollar-denominated borrowings under the Revolver from the London Interbank Offered Rate ("LIBOR") to an adjusted Secured Overnight Financing Rate ("SOFR"). The pricing and other terms applicable to the Increased Commitments are the same as those applicable to the existing revolving loan commitments that were in effect prior to the Amendment. Except as amended by the Amendment, the remaining terms of the unsecured credit facility remain in full force and effect.

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Accumulated Other Comprehensive Loss (Tables)

9 Months Ended

Sep. 30, 2023

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Changes in Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2023 and 2022 were as follows:

(in thousands)
Balance as of December 31, 2022	$	(5,211)
Other comprehensive income (loss) before reclassification	498
Balance as of September 30, 2023	$	(4,713)

(in thousands)
Balance as of December 31, 2021	$	(4,574)
Other comprehensive income (loss) before reclassification	(1,139)
Balance as of September 30, 2022	$	(5,713)

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Disclosures [Abstract]

Schedule of Fair Value of Assets

As of September 30, 2023 and December 31, 2022, the Company recognized the following assets at fair value on a recurring basis in the consolidated balance sheets:

	Fair Value Measurements at Reporting Date Using
(in thousands)	Total		Level 1		Level 2		Level 3
As of September 30, 2023
Mutual funds (1)	$	33,216	$	33,216	$	—	$	—
Money market funds (1)	4,568		—		4,568		—
Total	$	37,784	$	33,216	$	4,568	$	—
As of December 31, 2022
Mutual funds (1)	$	29,143	$	29,143	$	—	$	—
Money market funds (1)	3,242		—		3,242		—
Total	$	32,385	$	29,143	$	3,242	$	—

(1) The current assets at fair value noted above are presented in Prepaid expenses and other assets, and the long-term assets at fair value noted above are presented in Investments for employee benefit plans, at fair value, in the consolidated balance sheets.

Schedule of Carrying Amounts and Fair Values

As of September 30, 2023 and December 31, 2022, the carrying amounts and the fair values were as follows:

	September 30, 2023				December 31, 2022
(in thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
2020 Senior Notes	$	445,537	$	374,882	$	445,080	$	384,647
2019 Senior Notes	396,290		345,196		395,838		349,368

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Share-Based Compensation and Capital Stock (Tables)

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Stock-Based Compensation Expenses

The components of the Company’s share-based compensation expense for the three and nine months ended September 30, 2023 and 2022 were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2023		2022		2023		2022
Stock options	$	1,422	$	1,216	$	4,562	$	3,445
Restricted stock awards	3,305		3,763		10,362		10,364
Performance vested restricted stock units	5,261		4,887		17,041		13,051
Total share-based compensation expense	$	9,988	$	9,866	$	31,965	$	26,860

Schedule of Stock-Based Award Activity

A summary of the share-based award activity during the nine months ended September 30, 2023 is presented below:

	Stock Options				Restricted Stock			Performance Vested Restricted Stock Units
	Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Outstanding at January 1, 2023	1,010,647	$	94.97		399,099	$	128.47	437,180	$	140.05
Granted	88,733	123.62			64,216	123.95		109,786	127.82
Performance-Based Leveraging (1)	—	—			—	—		64,717	138.51
Exercised/Vested	(126,556)	57.04			(85,551)	94.82		(119,751)	145.41
Expired	—	—			—	—		—	—
Forfeited	(8,660)	126.49			(10,370)	116.26		(12,365)	134.36
Outstanding at September 30, 2023	964,164	$	102.30	5.9	367,394	$	135.87	479,567	$	136.11
Stock options exercisable at September 30, 2023	581,426	$	90.42	4.4

(1) Any revisions to the outstanding PVRSUs during the nine months ended September 30, 2023 is based on the Company's performance relative to the targeted performance conditions in the respective PVRSUs.

Schedule of Weighted Average Assumptions of Black-Scholes Option-Pricing Model

The fair value of the options granted during the nine months ended September 30, 2023 was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions:

Risk-free interest rate	4.10		%
Expected volatility	30.90		%
Expected life of the stock option	6.0 years
Dividend yield	0.9		%
Requisite service period	4 years
Contractual life	10 years
Weighted average fair value of the stock options granted (per stock option)	$	42.59

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Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2023

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Earnings Per Common Share

The computation of basic and diluted earnings per share of common stock was as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in thousands, except per share amounts)	2023		2022		2023		2022
Numerator:
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Income allocated to participating securities	(479)		(614)		(1,235)		(1,526)
Net income available to common shareholders	$	91,545	$	102,466	$	228,319	$	275,113
Denominator:
Weighted average shares of common stock outstanding – basic	50,041		54,847		50,641		55,233
Basic earnings per share	$	1.83	$	1.87	$	4.51	$	4.98
Numerator:
Net income	$	92,024	$	103,080	$	229,554	$	276,639
Income allocated to participating securities	(479)		(614)		(1,235)		(1,526)
Net income available to common shareholders	$	91,545	$	102,466	$	228,319	$	275,113
Denominator:
Weighted average shares of common stock outstanding – basic	50,041		54,847		50,641		55,233
Dilutive effect of stock options, PVRSUs, and RSUs	430		395		413		520
Weighted average shares of common stock outstanding – diluted	50,471		55,242		51,054		55,753
Diluted earnings per share	$	1.81	$	1.85	$	4.47	$	4.93

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following securities have been excluded from the calculation of diluted weighted average shares of common stock outstanding because the inclusion of these securities would have an anti-dilutive effect:

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(in thousands)	2023	2022	2023	2022
Stock options	150	170	233	154
PVRSUs	—	75	—	75

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Reportable Segment Information (Tables)

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Schedule of Financial Information for Company's Franchising Segment

The following table presents the financial information for the Company's segments:

	Three Months Ended September 30, 2023								Three Months Ended September 30, 2022
(in thousands)	Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated		Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated
Revenues	$	395,742	$	33,832	$	(4,017)	$	425,557	$	386,124	$	29,692	$	(1,550)	$	414,266
Operating income (loss)	$	167,459	$	(32,417)	$	—	$	135,042	$	161,084	$	(16,066)	$	—	$	145,018
Income (loss) before income taxes	$	169,260	$	(48,031)	$	—	$	121,229	$	162,162	$	(25,386)	$	—	$	136,776
	Nine Months Ended September 30, 2023								Nine Months Ended September 30, 2022
(in thousands)	Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated		Hotel Franchising & Management		Corporate & Other		Intersegment Eliminations		Consolidated
Revenues	$	1,106,643	$	86,464	$	(7,338)	$	1,185,769	$	980,352	$	63,363	$	(3,748)	$	1,039,967
Operating income (loss)	$	422,881	$	(85,599)	$	—	$	337,282	$	433,852	$	(32,088)	$	—	$	401,764
Income (loss) before income taxes	$	424,804	$	(123,533)	$	—	$	301,271	$	435,131	$	(68,494)	$	—	$	366,637

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Acquisitions (Tables)

9 Months Ended

Sep. 30, 2023

Business Combination and Asset Acquisition [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The final allocation of the purchase price, including all measurement period adjustments, as presented in our consolidated balance sheets is as follows:

(in thousands)	August 11, 2022 - original		Measurement Period Adj - 4th quarter 2022		Measurement Period Adj - 1st quarter 2023		August 11, 2022 - as adjusted
Cash and cash equivalents	$	113,023	$	—	$	—	$	113,023
Restricted cash	10,403		—		—		10,403
Accounts receivable	32,972		8,752		(1,941)		39,783
Notes receivable - current	1,709		—		(860)		849
Prepaid expenses and other current assets	8,139		—		—		8,139
Property and equipment	125,441		—		—		125,441
Operating lease right-of-use of assets	42,315		(2,016)		—		40,299
Intangible assets	447,400		(300)		—		447,100
Notes receivable - noncurrent	2,592		—		—		2,592
Investment in affiliates	471		—		—		471
Other assets	2,129		—		—		2,129
Total assets acquired	$	786,594	$	6,436	$	(2,801)	$	790,229
Accounts payable	$	8,295	$	(1,566)	$	(1,941)	$	4,788
Accrued expenses and other current liabilities	15,987		425		674		17,086
Deferred revenue - current(1)	5,745		1,566		—		7,311
Liability for guest loyalty program - current(1)	3,542		3,792		—		7,334
Long-term debt	55,975		—		—		55,975
Long-term deferred revenue(1)	26,499		(3,915)		—		22,584
Deferred compensation and retirement plan obligations	9,265		—		—		9,265
Operating lease liabilities	42,705		(2,016)		—		40,689
Liability for guest loyalty program - noncurrent(1)	10,180		(1,443)		—		8,737
Other liabilities	3,052		543		—		3,595
Total liabilities assumed	$	181,245	$	(2,614)	$	(1,267)	$	177,364
Fair value of net assets acquired	$	605,349	$	9,050	$	(1,534)	$	612,865
Goodwill	68,507		(9,050)		1,534		60,991
Total purchase consideration	$	673,856	$	—	$	—	$	673,856

(1) The Deferred revenue (including deferred affiliation fees) and Liability for guest loyalty program balances were assumed at their carrying value on the date of the acquisition pursuant to the application of ASU 2021-08. Refer to Note 1

The following table presents the estimated fair value of the acquired property and equipment, which is primarily concentrated at three acquired hotel properties, and their estimated weighted average remaining useful lives.

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Land	N/A	$	7,159
Construction in progress	N/A	3,190
Building and leasehold improvements	24.4	93,934
Site improvements	23.1	586
Furniture, fixtures and equipment	3.9	8,334
Computer equipment and software	2.0	12,238
Total property and equipment		$	125,441

Schedule of Acquired Indefinite-Lived Intangible Assets by Major Class

The following table presents the estimated fair values of the acquired identified intangible assets and their estimated useful lives:

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Trade names	N/A	$	223,700
Franchise agreements	15.5	220,100
Management agreements	15.5	3,300
Total intangible assets		$	447,100

Schedule of Acquired Finite-Lived Intangible Assets by Major Class

The following table presents the estimated fair values of the acquired identified intangible assets and their estimated useful lives:

	Estimated Useful Life	Estimated Fair Value
	(in years)	(in thousands)
Trade names	N/A	$	223,700
Franchise agreements	15.5	220,100
Management agreements	15.5	3,300
Total intangible assets		$	447,100

Schedule of Pro Forma Information

The following unaudited pro forma information presents the combined results of operations of Choice and Radisson Hotels Americas as if the Transaction was completed on January 1, 2021, but using the fair values of the assets acquired and the liabilities assumed as of the acquisition date. The unaudited pro forma information reflects adjustments relating to (i) the allocation of purchase price and related adjustments, including incremental depreciation and amortization expense based on the fair values of the acquired property and equipment and intangible assets, (ii) the incremental impact of the Revolver draw on interest expense and the amortization of financing costs, (iii) nonrecurring transaction costs, and (iv) the income tax impact of the aforementioned pro forma adjustments.

As required by GAAP, these unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the transaction had occurred at the beginning of the period presented, nor are they indicative of the future results of operations.

	Nine Months Ended
(in thousands)	September 30, 2022
Revenues	$	1,189,792
Net income	$	304,770

Schedule of Goodwill

The following table details the carrying amount of the Company's goodwill, including the goodwill arising from the acquisition of Radisson Hotels Americas, as of September 30, 2023.

(in thousands)
Goodwill, excluding goodwill arising from Radisson Hotels Americas acquisition	$	166,774
Accumulated impairment losses	(7,578)
Goodwill arising from Radisson Hotels Americas acquisition	60,991
Goodwill, net carrying amount	$	220,187

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Revenue - Narrative (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($) unit	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($) unit
Disaggregation of Revenue [Line Items]
Revenue, remaining performance obligation	$ 215,200		$ 215,200
Proceeds from the termination of intangible assets			0	$ 5,698
Revenues	425,557	$ 414,266	1,185,769	1,039,967
WoodSpring
Disaggregation of Revenue [Line Items]
Loss on contract termination		$ 22,700		$ 22,700
Number of properties | unit		110		110
Proceeds from the termination of intangible assets		$ 67,400		$ 67,400
Intangible assets, net		44,700		44,700
Corporate & Other
Disaggregation of Revenue [Line Items]
Revenues	33,832	29,692	86,464	63,363
Corporate & Other | Over time
Disaggregation of Revenue [Line Items]
Revenues	33,800	29,700	86,500	63,400
Intersegment Eliminations
Disaggregation of Revenue [Line Items]
Revenues	(4,017)	(1,550)	$ (7,338)	(3,748)
Royalty, licensing and management fees
Disaggregation of Revenue [Line Items]
Redemption of loyalty points period			3 years
Revenues	148,512	144,020	$ 396,503	356,208
Royalty, licensing and management fees | Intersegment Eliminations
Disaggregation of Revenue [Line Items]
Revenues	$ (4,000)	$ (1,600)	$ (7,300)	$ (3,700)
Minimum
Disaggregation of Revenue [Line Items]
Deferred revenue, recognition period			5 years
Maximum
Disaggregation of Revenue [Line Items]
Deferred revenue, recognition period			10 years

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Revenue - Contract Liability (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Changes in Contract Liability [Roll Forward]
Balance as of December 31, 2022	$ 209,359
Increases to the contract liability balance due to cash received	105,305
Revenue recognized in the period	(99,475)
Balance as of September 30, 2023	$ 215,189

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Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	$ 425,557	$ 414,266	$ 1,185,769	$ 1,039,967
Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	398,230	389,284	1,101,771	953,355
Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	27,327	24,982	83,998	86,612
Royalty, licensing and management fees
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	148,512	144,020	396,503	356,208
Royalty, licensing and management fees | Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	145,830	143,987	389,332	356,175
Royalty, licensing and management fees | Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	2,682	33	7,171	33
Initial franchise fees
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	6,194	7,011	21,240	21,635
Initial franchise fees | Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	6,194	7,011	21,240	21,635
Initial franchise fees | Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	0	0	0	0
Platform and procurement services fees
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	15,542	14,401	58,186	47,887
Platform and procurement services fees | Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	14,874	13,628	56,112	45,503
Platform and procurement services fees | Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	668	773	2,074	2,384
Owned hotels
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	26,239	19,992	74,075	49,220
Owned hotels | Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	19,497	14,877	55,544	39,720
Owned hotels | Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	6,742	5,115	18,531	9,500
Total revenues
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	11,436	31,432	33,211	51,588
Total revenues | Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	11,436	31,432	33,211	51,588
Total revenues | Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	0	0	0	0
Other revenues from franchised and managed properties
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	217,634	197,410	602,554	513,429
Other revenues from franchised and managed properties | Over time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	200,399	178,349	546,332	438,734
Other revenues from franchised and managed properties | Point in time
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue	$ 17,235	$ 19,061	$ 56,222	$ 74,695

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Receivables and Allowance for Credit Losses - Schedule Of Notes Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Dec. 31, 2021
Notes Receivable and Allowance for Losses [Line Items]
Notes receivable	$ 110,946	$ 118,215
Less: allowance for credit losses	8,389	10,172	$ 16,779
Total notes receivable, net of allowance for credit losses	102,557	108,043
Current portion, net of allowance for credit losses	52,726	52,466
Long-term portion, net of allowance for credit losses	49,831	55,577
Senior
Notes Receivable and Allowance for Losses [Line Items]
Notes receivable	86,374	95,466
Subordinated
Notes Receivable and Allowance for Losses [Line Items]
Notes receivable	19,592	17,075
Unsecured
Notes Receivable and Allowance for Losses [Line Items]
Notes receivable	$ 4,980	$ 5,674

XML

Receivables and Allowance for Credit Losses - Credit Quality Indicator (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Notes Receivable and Allowance for Losses [Line Items]
2023	$ 3,493
2022	215
2021	3,286
2020	903
2019	29,291
Prior	73,758
Total	110,946	$ 118,215
Senior
Notes Receivable and Allowance for Losses [Line Items]
2023	0
2022	0
2021	0
2020	0
2019	29,083
Prior	57,291
Total	86,374	95,466
Subordinated
Notes Receivable and Allowance for Losses [Line Items]
2023	3,493
2022	0
2021	1,994
2020	0
2019	0
Prior	14,105
Total	19,592	17,075
Unsecured
Notes Receivable and Allowance for Losses [Line Items]
2023	0
2022	215
2021	1,292
2020	903
2019	208
Prior	2,362
Total	$ 4,980	$ 5,674

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Receivables and Allowance for Credit Losses - Allowance for Credit Loss Rollforward (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 10,172	$ 16,779
Provision for credit losses	154	(938)
Recoveries	(1,937)	(5,669)
Ending balance	$ 8,389	$ 10,172

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Receivables and Allowance for Credit Losses - Narrative (Details) $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($) loan	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($) loan	Dec. 31, 2021 USD ($)
Notes Receivable and Allowance for Losses [Line Items]
Less: allowance for credit losses	$ 8,389		$ 10,172	$ 16,779
Loans and financing receivable	49,831		55,577
Allowance for credit loss	2,800	$ 12,900
Variable Interest Entity, Not Primary Beneficiary
Notes Receivable and Allowance for Losses [Line Items]
Loans and financing receivable	98,400		103,200
SG&A expenses
Notes Receivable and Allowance for Losses [Line Items]
Provision for (reversal of) credit losses	4,200	(400)
Cost of Sales | Other revenues from franchised and managed properties
Notes Receivable and Allowance for Losses [Line Items]
Provision for (reversal of) credit losses	4,000	$ 500
Interest Rate Below Market Reduction | Variable Interest Entity, Not Primary Beneficiary
Notes Receivable and Allowance for Losses [Line Items]
Loans and financing receivable	4,400		4,800
Receivable with imputed interest, discount (less than)	$ 100		$ 100
Collateral-Dependent Loans
Notes Receivable and Allowance for Losses [Line Items]
Number of loans | loan	1		1
Less: allowance for credit losses	$ 900		$ 900
Impaired Loans
Notes Receivable and Allowance for Losses [Line Items]
Nonaccrual status	$ 16,500		$ 18,700

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Receivables and Allowance for Credit Losses - Past Due Balances Of Mezzanine And Other Notes Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Financing Receivable, Past Due [Line Items]
Notes receivable	$ 110,946	$ 118,215
Senior
Financing Receivable, Past Due [Line Items]
Notes receivable	86,374	95,466
Subordinated
Financing Receivable, Past Due [Line Items]
Notes receivable	19,592	17,075
Unsecured
Financing Receivable, Past Due [Line Items]
Notes receivable	4,980	5,674
Total Past Due
Financing Receivable, Past Due [Line Items]
Notes receivable	44,954	17,508
Total Past Due | Senior
Financing Receivable, Past Due [Line Items]
Notes receivable	44,283	15,200
Total Past Due | Subordinated
Financing Receivable, Past Due [Line Items]
Notes receivable	271	2,209
Total Past Due | Unsecured
Financing Receivable, Past Due [Line Items]
Notes receivable	400	99
1- 30 days Past Due
Financing Receivable, Past Due [Line Items]
Notes receivable	0	20
1- 30 days Past Due | Senior
Financing Receivable, Past Due [Line Items]
Notes receivable	0	0
1- 30 days Past Due | Subordinated
Financing Receivable, Past Due [Line Items]
Notes receivable	0	0
1- 30 days Past Due | Unsecured
Financing Receivable, Past Due [Line Items]
Notes receivable	0	20
31-89 days Past Due
Financing Receivable, Past Due [Line Items]
Notes receivable	0	15,240
31-89 days Past Due | Senior
Financing Receivable, Past Due [Line Items]
Notes receivable	0	15,200
31-89 days Past Due | Subordinated
Financing Receivable, Past Due [Line Items]
Notes receivable	0	0
31-89 days Past Due | Unsecured
Financing Receivable, Past Due [Line Items]
Notes receivable	0	40
> 90 days Past Due
Financing Receivable, Past Due [Line Items]
Notes receivable	44,954	2,249
> 90 days Past Due | Senior
Financing Receivable, Past Due [Line Items]
Notes receivable	44,283	0
> 90 days Past Due | Subordinated
Financing Receivable, Past Due [Line Items]
Notes receivable	271	2,209
> 90 days Past Due | Unsecured
Financing Receivable, Past Due [Line Items]
Notes receivable	400	40
Current
Financing Receivable, Past Due [Line Items]
Notes receivable	65,992	100,707
Current | Senior
Financing Receivable, Past Due [Line Items]
Notes receivable	42,091	80,266
Current | Subordinated
Financing Receivable, Past Due [Line Items]
Notes receivable	19,321	14,866
Current | Unsecured
Financing Receivable, Past Due [Line Items]
Notes receivable	$ 4,580	$ 5,575

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Investments in Affiliates (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Variable Interest Entity [Line Items]
Investments in joint ventures included in unconsolidated entities	$ 2,232,237,000		$ 2,232,237,000		$ 2,102,175,000
Equity method investment impairment			0	$ 0
Consolidated Entity, Excluding Consolidated VIE
Variable Interest Entity [Line Items]
Investments in joint ventures included in unconsolidated entities	55,100,000		55,100,000		30,600,000
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Investments in joint ventures included in unconsolidated entities	45,300,000		45,300,000		$ 24,400,000
Losses attributable to variable interest entities	$ 900,000	$ 1,100,000	$ 3,200,000	$ 2,700,000

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Debt - Schedule Of Components Of Debt (Details) - USD ($)	Feb. 14, 2023	Sep. 30, 2023	Feb. 13, 2023	Dec. 31, 2022
Debt [Line Items]
Long-term debt		$ 1,395,688,000		$ 1,203,523,000
Less current portion		4,416,000		2,976,000
Long-term debt		$ 1,391,272,000		$ 1,200,547,000
Economic Development Loans
Debt [Line Items]
Debt instrument effective interest rate		3.00%		3.00%
Long-term debt		$ 4,416,000		$ 4,416,000
Line of Credit | Revolving Credit Facility
Debt [Line Items]
Total capacity	$ 850,000,000		$ 600,000,000
Borrowing capacity period increase	$ 250,000,000
$450 Million Senior Unsecured Notes Due 2031 | Senior
Debt [Line Items]
Debt instrument face amount		$ 450,000,000		$ 450,000,000
Debt instrument effective interest rate		3.86%		3.86%
Deferred issuance costs		$ 4,500,000		$ 4,900,000
Long-term debt		445,537,000		445,080,000
$400 Million Senior Unsecured Notes Due 2029 | Senior
Debt [Line Items]
Debt instrument face amount		$ 400,000,000		$ 400,000,000
Debt instrument effective interest rate		3.88%		3.88%
Deferred issuance costs		$ 3,700,000		$ 4,200,000
Long-term debt		396,290,000		395,838,000
$800 Million Unsecured Revolving Credit Facility | Senior
Debt [Line Items]
Debt instrument face amount		$ 850,000,000		$ 850,000,000
Debt instrument effective interest rate		6.40%		6.40%
Deferred issuance costs		$ 2,100,000		$ 1,800,000
Long-term debt		$ 549,445,000		$ 358,189,000

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Accumulated Other Comprehensive Loss - Changes in Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	$ 154,660	$ 265,882
Other comprehensive income (loss) before reclassification	498	(1,139)
Ending balance	72,413	284,511
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(5,211)	(4,574)
Ending balance	$ (4,713)	$ (5,713)

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Fair Value Measurements - Schedule Of Fair Value Of Assets (Details) - Fair value, measurements, recurring - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Fair Value Measurements [Line Items]
Total	$ 37,784	$ 32,385
Mutual funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	33,216	29,143
Money market funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	4,568	3,242
Level 1
Fair Value Measurements [Line Items]
Total	33,216	29,143
Level 1 | Mutual funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	33,216	29,143
Level 1 | Money market funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	0	0
Level 2
Fair Value Measurements [Line Items]
Total	4,568	3,242
Level 2 | Mutual funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	0	0
Level 2 | Money market funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	4,568	3,242
Level 3
Fair Value Measurements [Line Items]
Total	0	0
Level 3 | Mutual funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	0	0
Level 3 | Money market funds | Investments, employee benefit plans, at fair value
Fair Value Measurements [Line Items]
Mutual funds and money market funds, fair value	$ 0	$ 0

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Fair Value Measurements - Schedule of Carrying Amounts and Fair Values (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Fair Value Measurements [Line Items]
Long-term debt	$ 1,395,688	$ 1,203,523
Senior | 2020 Senior Notes
Fair Value Measurements [Line Items]
Long-term debt	445,537	445,080
Senior | 2020 Senior Notes | Level 2 | Carrying Amount
Fair Value Measurements [Line Items]
Long-term debt	445,537	445,080
Senior | 2020 Senior Notes | Level 2 | Fair Value
Fair Value Measurements [Line Items]
Long-term debt	374,882	384,647
Senior | 2019 Senior Notes
Fair Value Measurements [Line Items]
Long-term debt	396,290	395,838
Senior | 2019 Senior Notes | Level 2 | Carrying Amount
Fair Value Measurements [Line Items]
Long-term debt	396,290	395,838
Senior | 2019 Senior Notes | Level 2 | Fair Value
Fair Value Measurements [Line Items]
Long-term debt	$ 345,196	$ 349,368

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Income Taxes - Narrative (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Tax Disclosure [Abstract]
Effective income tax rate (percent)	24.10%	24.60%	23.80%	24.50%

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Share-Based Compensation and Capital Stock - Stock-Based Compensation Expenses And Associated Income Tax Benefits (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-Based Compensation and Capital Stock [Line Items]
Total share-based compensation expense	$ 9,988	$ 9,866	$ 31,965	$ 26,860
Stock options
Share-Based Compensation and Capital Stock [Line Items]
Total share-based compensation expense	1,422	1,216	4,562	3,445
Restricted stock awards
Share-Based Compensation and Capital Stock [Line Items]
Total share-based compensation expense	3,305	3,763	10,362	10,364
Performance vested restricted stock units
Share-Based Compensation and Capital Stock [Line Items]
Total share-based compensation expense	$ 5,261	$ 4,887	$ 17,041	$ 13,051

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Share-Based Compensation and Capital Stock - Summary of Stock-Based Award Activity (Details)	9 Months Ended
	Sep. 30, 2023 $ / shares shares
Stock Options
Options
Outstanding, beginning balance (in shares) | shares	1,010,647
Granted (in shares) | shares	88,733
Performance-Based Leveraging (in shares) | shares	0
Exercised/Vested (in shares) | shares	(126,556)
Expired (in shares) | shares	0
Forfeited (in shares) | shares	(8,660)
Outstanding, ending balance (in shares) | shares	964,164
Stock options exercisable (in shares) | shares	581,426
Weighted Average Exercise Price
Beginning balance (in usd per share) | $ / shares	$ 94.97
Granted (in usd per share) | $ / shares	123.62
Performance-Based Leveraging (in usd per share) | $ / shares	0
Exercised/Vested (in usd per share) | $ / shares	57.04
Expired (in usd per share) | $ / shares	0
Forfeited (in usd per share) | $ / shares	126.49
Ending balance (in usd per share) | $ / shares	102.30
Stock options exercisable - weighted average exercise price (in usd per share) | $ / shares	$ 90.42
Weighted Average Remaining Contractual Term
Outstanding	5 years 10 months 24 days
Stock options exercisable	4 years 4 months 24 days
Restricted Stock
Restricted Stock and Performance Vested Restricted Stock Units, Shares
Outstanding, beginning balance (in shares) | shares	399,099
Granted (in shares) | shares	64,216
Performance-Based Leveraging (in shares) | shares	0
Exercised/Vested (in shares) | shares	(85,551)
Expired (in shares) | shares	0
Forfeited (in shares) | shares	(10,370)
Outstanding, ending balance (in shares) | shares	367,394
Restricted Stock and Performance Vested Restricted Stock Units, Weighted Average Grant Date Fair Value
Outstanding, beginning balance (in usd per share) | $ / shares	$ 128.47
Granted (in usd per share) | $ / shares	123.95
Performance-Based Leveraging (in usd per share) | $ / shares	0
Exercised/Vested (in usd per share) | $ / shares	94.82
Expired (in usd per share) | $ / shares	0
Forfeited (in usd per share) | $ / shares	116.26
Outstanding, ending balance (in usd per share) | $ / shares	$ 135.87
Performance Vested Restricted Stock Units
Restricted Stock and Performance Vested Restricted Stock Units, Shares
Outstanding, beginning balance (in shares) | shares	437,180
Granted (in shares) | shares	109,786
Performance-Based Leveraging (in shares) | shares	64,717
Exercised/Vested (in shares) | shares	(119,751)
Expired (in shares) | shares	0
Forfeited (in shares) | shares	(12,365)
Outstanding, ending balance (in shares) | shares	479,567
Restricted Stock and Performance Vested Restricted Stock Units, Weighted Average Grant Date Fair Value
Outstanding, beginning balance (in usd per share) | $ / shares	$ 140.05
Granted (in usd per share) | $ / shares	127.82
Performance-Based Leveraging (in usd per share) | $ / shares	138.51
Exercised/Vested (in usd per share) | $ / shares	145.41
Expired (in usd per share) | $ / shares	0
Forfeited (in usd per share) | $ / shares	134.36
Outstanding, ending balance (in usd per share) | $ / shares	$ 136.11

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Share-Based Compensation and Capital Stock - Narrative (Details) - Performance vested restricted stock units	9 Months Ended
	Sep. 30, 2023
Minimum
Share-Based Compensation and Capital Stock [Line Items]
Requisite service period	9 months
Performance period, percent	0.00%
Maximum
Share-Based Compensation and Capital Stock [Line Items]
Requisite service period	48 months
Performance period, percent	230.00%

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Share-Based Compensation and Capital Stock - Weighted Average Assumptions Of Black-Scholes Option-Pricing Model (Details) - Stock options	9 Months Ended
	Sep. 30, 2023 $ / shares
Share-Based Compensation and Capital Stock [Line Items]
Risk-free interest rate	4.10%
Expected volatility	30.90%
Expected life of the stock option	6 years
Dividend yield	0.90%
Requisite service period	4 years
Contractual life	10 years
Weighted average fair value of the stock options granted (in usd per share)	$ 42.59

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Earnings Per Share - Computation Of Basic And Diluted Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022
Numerator:
Net income	$ 92,024	$ 84,710	$ 52,820	$ 103,080	$ 106,168	$ 67,391	$ 229,554	$ 276,639
Income allocated to participating securities	(479)			(614)			(1,235)	(1,526)
Net income available to common shareholders	$ 91,545			$ 102,466			$ 228,319	$ 275,113
Denominator:
Weighted average shares of common stock outstanding – basic (in shares)	50,041			54,847			50,641	55,233
Basic earnings per share (in usd per share)	$ 1.83			$ 1.87			$ 4.51	$ 4.98
Numerator:
Net income	$ 92,024	$ 84,710	$ 52,820	$ 103,080	$ 106,168	$ 67,391	$ 229,554	$ 276,639
Income allocated to participating securities	(479)			(614)			(1,235)	(1,526)
Net income available to common shareholders	$ 91,545			$ 102,466			$ 228,319	$ 275,113
Denominator:
Weighted average shares of common stock outstanding – basic (in shares)	50,041			54,847			50,641	55,233
Diluted effect of stock options, PVRSUs and RSUs (in shares)	430			395			413	520
Weighted average shares of common stock outstanding – diluted (in shares)	50,471			55,242			51,054	55,753
Diluted earnings per share (in usd per share)	$ 1.81			$ 1.85			$ 4.47	$ 4.93

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Earnings Per Share - Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Stock options (in shares)	150	170	233	154
PVRSUs
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
PVRSUs (in shares)	0	75	0	75

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Reportable Segment Information - Narrative (Details)	Sep. 30, 2023 brand hotel
Segment Reporting [Abstract]
Number of brands | brand	22
Number of hotel management operations	13
Number of owned hotels	3

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Reportable Segment Information - Schedule Of Financial Information For Company's Franchising Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Reportable Segment Information [Line Items]
Revenues	$ 425,557	$ 414,266	$ 1,185,769	$ 1,039,967
Operating income (loss)	135,042	145,018	337,282	401,764
Income (loss) before income taxes	121,229	136,776	301,271	366,637
Corporate & Other
Reportable Segment Information [Line Items]
Revenues	33,832	29,692	86,464	63,363
Operating income (loss)	(32,417)	(16,066)	(85,599)	(32,088)
Income (loss) before income taxes	(48,031)	(25,386)	(123,533)	(68,494)
Intersegment Eliminations
Reportable Segment Information [Line Items]
Revenues	(4,017)	(1,550)	(7,338)	(3,748)
Operating income (loss)	0	0	0	0
Income (loss) before income taxes	0	0	0	0
Hotel Franchising & Management | Operating Segments
Reportable Segment Information [Line Items]
Revenues	395,742	386,124	1,106,643	980,352
Operating income (loss)	167,459	161,084	422,881	433,852
Income (loss) before income taxes	$ 169,260	$ 162,162	$ 424,804	$ 435,131

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Commitments and Contingencies (Details) $ in Millions	Sep. 30, 2023 USD ($) hotel
Commitments and Contingencies [Line Items]
Limited payment guaranties	$ 4.5
Radisson Hotels Americas | Affiliated Entity
Commitments and Contingencies [Line Items]
Number of hotels managed | hotel	8
Maximum amount of guarantee	$ 22.0
Forgivable notes receivable
Commitments and Contingencies [Line Items]
Other commitment	$ 350.3

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Transactions with Unconsolidated Affiliates (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Related Party Transaction [Line Items]
Revenues	$ 425,557	$ 414,266	$ 1,185,769	$ 1,039,967
Accounts receivable	223,781		223,781		$ 216,614
Affiliated Entity | Fees Earned And Payroll Costs Reimbursed
Related Party Transaction [Line Items]
Revenues	2,400	800	6,100	1,700
Affiliated Entity | Royalty And Marketing Reservation System Fee
Related Party Transaction [Line Items]
Revenues	9,400	$ 8,900	23,100	$ 19,500
Accounts receivable	$ 5,200		$ 5,200		$ 3,900

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Acquisitions - Narrative (Radisson Hotels Americas Acquisition) (Details) - USD ($) $ in Thousands		3 Months Ended				9 Months Ended
	Aug. 11, 2022	Sep. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Business Acquisition [Line Items]
Proceeds from acquired derivative						$ 0	$ 1,943
Goodwill		$ 220,187		$ 218,653		220,187
Radisson Hotels Americas
Business Acquisition [Line Items]
Purchase price	$ 673,900
Base purchase price to acquire businesses	675,200
Acquisition related costs		$ 10,900			$ 24,900	$ 30,600	29,000
Goodwill			$ 1,534	$ (9,050)
Long-term debt	55,975
Proceeds from acquired derivative	1,900
Restricted cash	10,403
Goodwill	60,991
Revenue					40,200		40,200
Net loss					$ (1,400)		$ (1,400)
Radisson Hotels Americas | Revolving Credit Facility | Unsecured Credit Facility | Line of Credit
Business Acquisition [Line Items]
Proceeds from lines of credit	$ 175,000

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Acquisitions - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022	Sep. 30, 2023	Aug. 11, 2022
Total liabilities assumed
Goodwill		$ 218,653	$ 220,187
Radisson Hotels Americas
Total assets acquired
Cash and cash equivalents				$ 113,023
Restricted cash				10,403
Accounts receivable				39,783
Notes receivable - current				849
Prepaid expenses and other current assets				8,139
Property and equipment				125,441
Operating lease right-of-use of assets				40,299
Intangible assets				447,100
Notes receivable - noncurrent				2,592
Investment in affiliates				471
Other assets				2,129
Total assets acquired				790,229
Total liabilities assumed
Accounts payable				4,788
Accrued expenses and other current liabilities				17,086
Deferred revenue - current				7,311
Liability for guest loyalty program - current				7,334
Long-term debt				55,975
Long-term deferred revenue				22,584
Deferred compensation and retirement plan obligations				9,265
Operating lease liabilities				40,689
Liability for guest loyalty program - noncurrent				8,737
Other liabilities				3,595
Total liabilities assumed				177,364
Fair value of net assets acquired				612,865
Goodwill				60,991
Total purchase consideration				673,856
Measurement Period
Cash and cash equivalents	$ 0	0
Restricted cash	0	0
Accounts receivable	(1,941)	8,752
Notes receivable - current	(860)	0
Prepaid expenses and other current assets	0	0
Property and equipment	0	0
Operating lease right-of-use of assets	0	(2,016)
Intangible assets	0	(300)
Notes receivable - noncurrent	0	0
Investment in affiliates	0	0
Other assets	0	0
Total assets acquired	(2,801)	6,436
Accounts payable	(1,941)	(1,566)
Accrued expenses and other current liabilities	674	425
Deferred revenue - current	0	1,566
Liability for guest loyalty program - current	0	3,792
Long-term debt	0	0
Long-term deferred revenue	0	(3,915)
Deferred compensation and retirement plan obligations	0	0
Operating lease liabilities	0	(2,016)
Liability for guest loyalty program - noncurrent	0	(1,443)
Other liabilities	0	543
Total liabilities assumed	(1,267)	(2,614)
Fair value of net assets acquired	(1,534)	9,050
Goodwill	1,534	(9,050)
Total purchase consideration	$ 0	$ 0
Radisson Hotels Americas | Previously Reported
Total assets acquired
Cash and cash equivalents				113,023
Restricted cash				10,403
Accounts receivable				32,972
Notes receivable - current				1,709
Prepaid expenses and other current assets				8,139
Property and equipment				125,441
Operating lease right-of-use of assets				42,315
Intangible assets				447,400
Notes receivable - noncurrent				2,592
Investment in affiliates				471
Other assets				2,129
Total assets acquired				786,594
Total liabilities assumed
Accounts payable				8,295
Accrued expenses and other current liabilities				15,987
Deferred revenue - current				5,745
Liability for guest loyalty program - current				3,542
Long-term debt				55,975
Long-term deferred revenue				26,499
Deferred compensation and retirement plan obligations				9,265
Operating lease liabilities				42,705
Liability for guest loyalty program - noncurrent				10,180
Other liabilities				3,052
Total liabilities assumed				181,245
Fair value of net assets acquired				605,349
Goodwill				68,507
Total purchase consideration				$ 673,856

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Acquisitions - Schedule Of Property Plant And Equipment Acquired (Details) - Radisson Hotels Americas $ in Thousands	Aug. 11, 2022 USD ($)
Business Acquisition [Line Items]
Estimated Fair Value	$ 125,441
Land
Business Acquisition [Line Items]
Estimated Fair Value	7,159
Construction in progress
Business Acquisition [Line Items]
Estimated Fair Value	$ 3,190
Building and leasehold improvements
Business Acquisition [Line Items]
Estimated Useful Life	24 years 4 months 24 days
Estimated Fair Value	$ 93,934
Site improvements
Business Acquisition [Line Items]
Estimated Useful Life	23 years 1 month 6 days
Estimated Fair Value	$ 586
Furniture, fixtures and equipment
Business Acquisition [Line Items]
Estimated Useful Life	3 years 10 months 24 days
Estimated Fair Value	$ 8,334
Computer equipment and software
Business Acquisition [Line Items]
Estimated Useful Life	2 years
Estimated Fair Value	$ 12,238

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Acquisitions - Schedule of Indefinite-Lived Intangible Assets (Details) $ in Thousands	Aug. 11, 2022 USD ($)
Trade Names
Business Acquisition [Line Items]
Estimated Fair Value	$ 223,700
Radisson Hotels Americas
Business Acquisition [Line Items]
Estimated Fair Value	$ 447,100
Radisson Hotels Americas | Franchise Rights
Business Acquisition [Line Items]
Estimated Useful Life	15 years 6 months
Estimated Fair Value	$ 220,100
Radisson Hotels Americas | Management Agreements
Business Acquisition [Line Items]
Estimated Useful Life	15 years 6 months
Estimated Fair Value	$ 3,300

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Acquisitions - Schedule of Pro Forma Information (Details) - Radisson Hotels Americas $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($)
Business Acquisition [Line Items]
Revenues	$ 1,189,792
Net income	$ 304,770

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Acquisitions - Schedule of Goodwill (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022	Aug. 11, 2022
Business Acquisition [Line Items]
Goodwill	$ 220,187	$ 218,653
Radisson Hotels Americas
Business Acquisition [Line Items]
Goodwill, excluding goodwill arising from Radisson Hotels Americas acquisition		$ 166,774
Accumulated impairment losses	(7,578)
Goodwill arising from Radisson Hotels Americas acquisition	$ 60,991
Goodwill			$ 60,991