Choice Hotels has appointed Dominic Dragisich as interim CEO, who took on the leadership role 11 weeks ago. The company operates a franchise portfolio that continues to add room inventory, but faces challenges in generating revenue per available room (RevPAR) that matches its competitors.
During the second quarter, Choice’s performance across key hotel categories fell short of broader industry benchmarks. Upscale-and-above hotels in the United States achieved RevPAR growth of 1.3% year over year, substantially trailing the industry average of approximately 5% for comparable chain scales. The company’s midscale and upper midscale properties grew RevPAR by 1.1%, while the broader segment achieved roughly 4% growth. Budget hotel properties declined 0.7% in RevPAR, compared to approximately 1% growth for the overall budget segment.
Analysts interpreted these results as evidence of continued market share loss at Choice. Patrick Scholes, an analyst at Truist Securities, characterized the company’s underperformance as a persistent pattern that suggests the franchise operator continues losing ground to competitors.
Dragisich addressed the revenue performance during earnings discussions with analysts, framing the challenge as his immediate priority. He stated that his principal objective involves narrowing the performance differential between Choice’s current position and what he believes the business is capable of achieving. The statement indicates the company recognizes the scope of the challenge and views revenue performance improvement as central to the new leadership’s agenda.
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