10-Q: Hertz Reports Revenue Growth Amidst Rising Costs

Hertz Global Holdings, Inc. reported a 10% increase in total revenues for the first half of 2026, driven by improved pricing, though operating costs and depreciation also rose.

Summary

• Hertz Global Holdings, Inc. and The Hertz Corporation filed their Quarterly Report on Form 10-Q for the period ended June 30, 2026.
• Total revenues increased by 10% for both the three and six-month periods ended June 30, 2026, compared to the prior year, primarily due to improved pricing.
• Depreciation of revenue earning vehicles and lease charges, net, increased by 17% for the three-month period and 2% for the six-month period.
• Direct vehicle and operating expenses (DOE) increased by 4% for the three-month period and 5% for the six-month period.
• Non-vehicle interest expense, net, decreased significantly due to fair value adjustments on exchangeable notes.
• The company reported a net loss of $34 million for the three months ended June 30, 2026, and a net loss of $399 million for the six months ended June 30, 2026.
• Hertz Global Holdings, Inc. had a net income of $64 million for the three months ended June 30, 2026, and a net loss of $269 million for the six months ended June 30, 2026.
• The company's Adjusted Corporate EBITDA was $81 million for the three months ended June 30, 2026, and $(80) million for the six months ended June 30, 2026.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this filing as cautiously optimistic, with revenue growth driven by pricing improvements, but offset by increased operating costs and depreciation.

Positives

• Total revenues increased by 10% for both the three and six-month periods ended June 30, 2026, compared to the prior year, driven by improved pricing.
• Total RPD (pricing) increased by 10% in the Americas RAC segment for the three-month period and 8% for the six-month period.
• Total RPD increased by 3% in the International RAC segment for both the three and six-month periods.
• Vehicle Utilization remained strong at 83% in Americas RAC and 78% in International RAC for the six-month period.
• The company was in compliance with its First Lien Ratio and minimum liquidity covenants as of June 30, 2026.
• Hertz Global Holdings, Inc. reported a net income of $64 million for the three months ended June 30, 2026.
• The company raised $3 million in net proceeds from its ATM Program between April 1, 2026, and June 30, 2026.

Negatives

• Depreciation of revenue earning vehicles and lease charges, net, increased by 17% for the three-month period and 2% for the six-month period, partly due to reduced gains on vehicle disposals.
• Direct vehicle and operating expenses (DOE) increased by 4% for the three-month period and 5% for the six-month period, driven by higher collision, refueling, and maintenance costs.
• The Hertz Corporation reported a net loss of $34 million for the three months ended June 30, 2026, and a net loss of $399 million for the six months ended June 30, 2026.
• Hertz Global Holdings, Inc. reported a net loss of $269 million for the six months ended June 30, 2026.
• Adjusted Corporate EBITDA was negative for the six-month period for both Hertz Global Holdings, Inc. and The Hertz Corporation ($80 million and $(80) million respectively).
• The company's available corporate liquidity decreased from $1,489 million at December 31, 2025, to $984 million at June 30, 2026.

Risks

• The potential for residual values associated with non-program vehicles to decline, including suddenly or unexpectedly.
• Disruptions in the supply chain, including in connection with any increases in tariffs or changes in tariff policies or trade agreements.
• Levels of travel demand, particularly business and leisure travel in the U.S. and in global markets.
• Seasonality and other occurrences that disrupt rental activity during peak periods.
• The company's ability to implement its business strategy or strategic transactions.
• The potential for adverse changes in laws, regulations, policies or other activities of governments, agencies and similar organizations.
• The availability of additional, or continued sources, of financing at acceptable rates for revenue earning vehicles and to refinance existing indebtedness.

Future Outlook

The company expects to continue evaluating and completing sales and leasebacks of certain non-vehicle capital assets through the end of 2026. The company believes its cash on hand, operating cash flow, and access to financing will be sufficient to fund its operations and obligations for the next twelve months and beyond.

Management Comments

• The increase in total revenues was due primarily to improved pricing.
• Depreciation of revenue earning vehicles and lease charges, net, increased due primarily to reduced gains and residual variability.
• The increase in DOE was due primarily to higher collision, refueling and maintenance costs in our Americas RAC segment.
• We expect to continue to evaluate and complete, when deemed appropriate, sales and lease backs of certain non-vehicle capital assets through the end of 2026.

Industry Context

StockSavvy.ai notes that Hertz's performance reflects broader industry trends of increased pricing power, but also rising operational costs and the ongoing challenge of managing vehicle depreciation and residual values.

Corporate Governance

Legal Proceedings

• Wells Fargo Bank, N.A. v. The Hertz Corp., et al. concerning make-whole and post-petition interest claims, with the U.S. Supreme Court denying the petition for writ of certiorari on January 12, 2026.
• Angelo Cascia putative class and derivative lawsuit regarding share repurchase programs, with a settlement approved on July 23, 2026.
• Edward M. Doller v. Hertz Global Holdings, Inc. et al. class action complaint alleging violations of securities laws concerning statements regarding demand for EVs, with parties settling in principle on March 12, 2026.
• Data Breach Claims filed against Cleo Communications U.S., LLC and Hertz, with a conditional settlement reached on June 30, 2026.
• Cameron Schweitzer class action complaint alleging violations of federal securities laws concerning liquidity and used car market statements, filed on July 24, 2026.

Stakeholder Impact

• Shareholders may be impacted by the company's net losses and the decrease in available corporate liquidity, although revenue growth and pricing improvements are positive indicators.
• Employees may be affected by the company's focus on cost control and operational efficiency.
• Creditors are subject to the company's debt obligations, with substantial vehicle and non-vehicle debt outstanding.

Next Steps

• Continue to evaluate and complete sales and lease backs of certain non-vehicle capital assets through the end of 2026.
• Manage fleet strategically, balancing vehicle sourcing, deployment, and monetization.
• Focus on revenue optimization and rigorous cost control as part of the 'Back-to-Basics' roadmap.

Key Dates

Recommendation

While Hertz shows revenue growth driven by pricing, the increased operating costs, depreciation, and continued net losses for the six-month period suggest a cautious approach. The company's ability to manage its debt and fleet costs effectively will be key. The recent capital raises and ongoing legal proceedings also warrant close monitoring.

Keywords

vehicle rental, fleet management, revenue, depreciation, operating expenses, debt, financial performance, sec filing