Q2 2026 Hertz Global Holdings Inc Earnings Call Transcript
Key Points
- Revenue increased 10% year-over-year to $2.4 billion despite a 1% smaller fleet, driven by a 9% increase in RPD, the strongest second-quarter RPD on record excluding 2022.
- Adjusted corporate EBITDA improved by $63 million year-over-year to $81 million, exceeding guidance, with adjusted corporate EBITDA margin expanding by 260 basis points to 3.4%.
- Total fleet utilization increased by 80 basis points to 79% despite a nearly 200 basis point headwind from elevated recalls, demonstrating strong operational execution.
- The company achieved 200 consecutive days of positive year-over-year RPD, and early Q3 results indicate meaningful RPD gains are on track, supported by a constructive industry pricing environment.
- The fleet is the youngest in over a dozen years at under nine months, with model year '25 and '26 units comprising nearly 94% of the US core fleet, positioning the company well for future depreciation benefits and fleet rotation.
- Elevated recalls remain a significant headwind, with recall volume up 300% year-over-year in Q2, impacting an average of 15,000 vehicles per month and resulting in a $55 million EBITDA impact in the first half of 2026.
- Net DPU came in at $302, slightly above the North Star target, due to three quarter-specific items including a more pronounced seasonal decline in wholesale prices, suboptimal disposition channels, and a mix shift toward older vehicles.
- Adjusted DOE per transaction day increased slightly year-over-year to $37.49, driven by higher revenue-related variable costs and expenses tied to sale-leaseback transactions, which can appear less favorable in isolation.
- The company lowered its year-end liquidity guidance to $1.0 billion to $1.4 billion from a previous expectation of over $1.5 billion, primarily due to removing proceeds from the ATM program from its forecast.
- The company faces upcoming debt maturities in 2028 and 2029, and while it expects to be free cash flow positive in 2027, it has not provided specific details on how it will address these maturities, creating uncertainty for investors.
Welcome to Hertz Global Holdings first-quarter 2026 earnings call. (Operator Instructions)
I would like to remind you that this morning's call is being recorded by the company. I would now like to turn the call over to Bill Kocovski, Senior Vice President, Finance. Please go ahead.
Good morning, everyone, and thank you for joining us. By now, you should have our earnings press release and associated financial information. We've also provided slides to accompany our conference call, and these can be accessed through the Investor Relations section of our website.
I want to remind you that certain statements made on this call contain forward-looking information. Forward-looking statements are not a guarantee of performance, and by their nature, are subject to inherent risks and uncertainties. Actual results may differ materially. Any forward-looking information relayed on this call speaks only as of today's date, and the company undertakes no obligation to update that
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