AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-3: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 6/6 · 31/10/2026
Moat56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 3/4 · The 1,768-location global network at year-end 2025 and $23.8 billion fleet at original equipment cost in June 2026 support substantial purchasing and service scale. Improved general rentals cost absorption corroborates operational usefulness. Relative procurement savings and competitor cost comparisons remain unquantified management assertions.
durability · 2/4 · The established physical network and approximately unchanged 15% estimated North American share at December 31, 2025 support persistence. Nevertheless, fragmented competition limits rate protection, and realized replacement-cost increases require continuing investment. These facts support a durable but bounded advantage, without demonstrating exceptional protection.
customer dependency · 2/4 · Fleet breadth serves customers with substantial and varied equipment needs. Improved customer NPS and 77.5% digital adoption in 2025 support service relevance and engagement. Adoption measures revenue associated with recent tool use; neither metric demonstrates exclusivity, substantial migration costs or inability to use alternative suppliers.
erosion resilience · 2/4 · Stable estimated share and improving first-half 2026 rental gross margin counterbalance 2025 rental-margin deterioration. Specialty compression continued, while second-quarter adjusted EBITDA margin excluding the business-sale gain fell 40 basis points year over year. Actual results show partial resilience, consistent with historical competitive harm.
Pricing power44
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 1/4 · Used-equipment pricing normalization contributed to 2025 disposal-margin deterioration, and competition historically depressed chargeable rental prices. Partial inflation pass-through provides a counterweight. These observed outcomes support weak pricing power overall; fleet productivity cannot establish rental-rate strength because it combines rates, utilization and mix.
retention · 2/4 · Customer NPS improved by more than 1.5 percentage points in 2025, digital adoption reached 77.5%, and first-half 2026 rental revenue increased. These are indirect engagement and demand indicators. They do not isolate repeat demand, because growth can include fleet expansion, acquisitions and mix changes.
margin resilience · 2/4 · Rental gross margin declined from 39.9% in 2024 to 38.0% in 2025, then improved from 37.4% to 37.8% in the first half of 2026. Better general rentals cost absorption coexists with specialty compression and underlying second-quarter adjusted EBITDA margin erosion. This is mixed resilience, not evidence of price control.
contractual freedom · 2/4 · Actual fuel and delivery cost pass-through supports some freedom to adjust customer charges. Payments remain determined by the contract period applicable to actual equipment usage. The evidence supports limited flexibility but does not establish unilateral repricing rights, automatic escalation clauses or the maximum duration of rental commitments.
Predictability98
5 consecutive published annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 7.86
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 1.19
- observedAnnualPeriods
- 5.00
Financial strength26
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or reported pretax profit plus reported gross interest expense. Reported EBIT is distinct from GAAP operating income and gross interest. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 0.00
- netDebtEbitGrade
- 30.68
- interestCoverageGrade
- 58.02
- currentRatioGrade
- 15.58
- Debt / FCF (x)
- 21.49
- Net debt / operating income (x)
- 3.47
- Current ratio (x)
- 0.94
- cashInterestPaid
- 703.00
- cashInterestCoverage
- 7.38
Capital allocation75
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or EBIT calculated from reported pretax profit plus reported gross interest expense; the issuer-reported EBIT is distinct from GAAP operating income and gross interest; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. ROIC remains undefined for nonpositive invested capital; the explicit asset-return alternative does not change the ROIC chart. Missing financial inputs alone never trigger an alternative. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 19.39
- 3-year average dilution (%)
- -3.04
- 3-year average SBC / revenue (%)
- 0.74
- cashConversionGrade
- 22.89
Management69
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · First-half 2026 operating cash of $3.305 billion supported $2.720 billion of rental-equipment purchases, while net leverage declined to 1.8x. However, acquisitions and distributions accompanied cash falling from $459 million to $112 million, and 2025 incentive ROIC missed target. Acquisition returns and repurchase value creation remain unproven.
incentive alignment · 3/4 · Actual 2025 PRSUs weighted revenue and ROIC equally and settled in shares in early 2026. Net-share retention requirements, disclosed NEO ownership-guideline compliance and mandatory restatement recovery strengthen alignment. Annual goal setting within three-year awards and absent individual ownership balances limit evidence of exceptional long-term alignment.
execution · 3/4 · Opening 60 specialty branches in 2025, achieving customer engagement goals, growing first-half 2026 rental revenue and operating income, and improving general rentals cost absorption demonstrate execution across several dimensions. Operating outcomes are indirect evidence of management effectiveness; specialty compression and the incentive ROIC shortfall temper the assessment.
governance · 3/4 · Fully independent required committees, separate Chair and CEO roles, a Lead Independent Director, shareholder rights and mandatory compensation recovery provide strong structural safeguards. All eleven directors were subsequently elected in May 2026. The Chair is non-independent, and these disclosures do not establish how effectively every safeguard operates.
Evidence
Significant Purchasing Power. We purchase large amounts of equipment, contractor supplies and other items, which enables us to negotiate favorable pricing, warranty and other terms with our vendors.
2025 Form 10-K, filed 2026-01-28; competitive advantages—purchasing power · Filed 28/01/2026
Our large and diverse fleet allows us to serve large customers that require substantial quantities and/or wide varieties of equipment.
2025 Form 10-K, filed 2026-01-28; competitive advantages—fleet breadth · Filed 28/01/2026
Geographic and Customer Diversity. We primarily operate in the United States and Canada, and have a smaller presence in Europe, Australia and New Zealand, and our global branch network includes 1,768 rental locations.
2025 Form 10-K, filed 2026-01-28; geographic scope and global rental locations · Filed 28/01/2026
Our estimated North American market share of approximately 15 percent as of December 31, 2025, which is based on industry estimates (excluding party and event rentals) from the ARA, did not change materially from our market share as of December 31, 2024.
2025 Form 10-K, filed 2026-01-28; estimated North American market share and ARA scope · Filed 28/01/2026
These include a fleet of rental equipment with a total original equipment cost (“OEC”) of $23.8 billion, and a North American branch network that operates in 49 U.S.
June 2026 Form 10-Q, filed 2026-07-22; fleet original equipment cost and branch footprint · Filed 22/07/2026
states and every Canadian province, and serves 99 of the 100 largest metropolitan areas in the U.S.
June 2026 Form 10-Q, filed 2026-07-22; continuation of North American branch coverage · Filed 22/07/2026
Our size also gives us greater purchasing power, the ability to provide customers with a broader range of equipment and services, the ability to provide customers with equipment that is more consistently well-maintained and therefore more productive and reliable, and the ability to enhance the earning potential of our assets by transferring equipment among branches to satisfy customer needs.
June 2026 Form 10-Q, filed 2026-07-22; management explanation of scale and interbranch transfers · Filed 22/07/2026
Gross margin increased primarily due to better cost performance and fixed cost absorption on higher revenue, as reflected in reductions in depreciation and labor and benefits expenses as a percentage of revenue.
June 2026 Form 10-Q, filed 2026-07-22; general rentals gross-margin drivers · Filed 22/07/2026
The fragmented nature of the industry and our relatively small market share, however, may adversely impact our ability to mitigate rental rate pressure.
2025 Form 10-K, filed 2026-01-28; fragmentation and rental-rate pressure · Filed 28/01/2026
Our competitors primarily include small, independent businesses with one or two rental locations; regional competitors that operate in one or more states; public companies or divisions of public companies that operate nationally or internationally; and equipment vendors and dealers who both sell and rent equipment directly to customers.
2025 Form 10-K, filed 2026-01-28; generic competitor categories · Filed 28/01/2026
The costs of new equipment we use in our fleet have increased, and may continue to increase, requiring us to spend more for replacement equipment or preventing us from procuring equipment on a timely basis.
2025 Form 10-K, filed 2026-01-28; realized equipment-cost increases and procurement risk · Filed 28/01/2026
Competitive pressures have in the past adversely affected, and could again in the future adversely affect, our revenues and operating results by, among other things, decreasing our rental volumes, depressing the prices that we can charge or increasing our costs to retain employees.
2024 Form 10-K, filed 2025-01-29; historical adverse effects of competitive pressure · Filed 29/01/2025
60 Table of Contents Year Ended December 31, 2025 2024 2023 General rentals Specialty Total General rentals Specialty Total General rentals Specialty Total Equipment rentals $9,165 $4,641 $13,806 $8,945 $4,084 $13,029 $8,803 $3,261 $12,064 Sales of rental equipment 1,216 197 1,413 1,328 193 1,521 1,411 163 1,574 Sales of new equipment 199 149 348 159 123 282 95 123 218 Contractor supplies sales 87 76 163 87 68 155 89 57 146 Service and other revenues 334 35 369 326 32 358 299 31 330 Total revenue (1) 11,001 5,098 16,099 10,845 4,500 15,345 10,697 3,635 14,332 Equipment rentals gross profit (see calculation below) 3,225 2,023 5,248 3,232 1,966 5,198 3,219 1,595 4,814 Equipment rentals gross margin 35.2% 43.6% 38.0% 36.1% 48.1% 39.9% 36.6% 48.9% 39.9% Capital expenditures (2) 3,409 1,159 4,568 3,102 1,028 4,130 3,051 813 3,864 Calculation of equipment rentals gross profit: Equipment rentals 9,165 4,641 13,806 8,945 4,084 13,029 8,803 3,261 12,064 Less: Depreciation of rental equipment (2,021) (649) (2,670) (1,968) (498) (2,466) (1,989) (361) (2,350) Significant/all other rental expenses (3): Labor and benefits (4) (1,637) (524) (2,161) (1,576) (442) (2,018) (1,519) (377) (1,896) Repairs and maintenance (848) (239) (1,087) (830) (211) (1,041) (827) (176) (1,003) Delivery (514) (473) (987) (472) (350) (822) (448) (269) (717) All other rental expenses (3) (920) (733) (1,653) (867) (617) (1,484) (801) (483) (1,284) Equipment rentals gross profit 3,225 2,023 5,248 3,232 1,966 5,198 3,219 1,595 4,814 Reconciliation of equipment rentals gross profit to income before provision for income taxes: Gross profit from other lines of business 896 952 999 Selling, general and administrative expenses (1,732) (1,645) (1,527) Restructuring charge (5) (1) (3) (28) Non-rental depreciation and amortization (438) (437) (431) Interest expense, net (716) (691) (635) Other income, net (6) 81 14 19 Income before provision for income taxes $3,338 $3,388 $3,211 December 31, 2025 December 31, 2024 December 31, 2023 General rentals Specialty Total General rentals Specialty Total General rentals Specialty Total Total assets (7) $21,787 $8,079 $29,866 $21,044 $7,119 $28,163 $20,411 $5,178 $25,589 ___________________ (1)Includes immaterial intersegment revenues.
2025 Form 10-K, filed 2026-01-28; annual segment rental gross margins, 2023–2025 · Filed 28/01/2026
Segment equipment rentals gross profit and gross margin were as follows: General rentals Specialty Total Three Months Ended June 30, 2026 Equipment Rentals Gross Profit $ 865 $ 636 $ 1,501 Equipment Rentals Gross Margin 35.8 % 44.4 % 39.0 % Three Months Ended June 30, 2025 Equipment Rentals Gross Profit $ 796 $ 525 $ 1,321 Equipment Rentals Gross Margin 35.1 % 45.8 % 38.7 % Six Months Ended June 30, 2026 Equipment Rentals Gross Profit $ 1,618 $ 1,129 $ 2,747 Equipment Rentals Gross Margin 34.8 % 43.1 % 37.8 % Six Months Ended June 30, 2025 Equipment Rentals Gross Profit $ 1,475 $ 976 $ 2,451 Equipment Rentals Gross Margin 33.8 % 44.5 % 37.4 % General rentals.
June 2026 Form 10-Q, filed 2026-07-22; three- and six-month segment rental gross margins · Filed 22/07/2026
Gross margin decreased primarily due to changes in revenue mix driven by growth in lower-margin ancillary and re-rent revenues, partially offset by a reduction in labor and benefits expenses as a percentage of revenue.
June 2026 Form 10-Q, filed 2026-07-22; specialty margin decline and revenue mix · Filed 22/07/2026
Excluding the gain on sale of business, adjusted EBITDA margin for the second quarter of 2026 decreased 40 basis points year-over-year.
Second-quarter 2026 earnings release, filed 2026-07-22; adjusted EBITDA margin excluding business-sale gain · Filed 22/07/2026
Scope 3 emissions from third-party haulers were higher than expected due to increased third-party hauling activity related to mega-project activity and our matting business Excluding Scope 3 emissions, forecasted 33.5% reduction in Scope 1 and 2 GHG emissions intensity from 2018 baseline, which is above the goal Customer Experience Customer Experience: Net Promoter Score (“NPS”) NPS score greater than or equal to 72.6 Met goal and achieved greater than 1.5 percentage point improvement year-over-year Customer Digital Adoption: Percentage of total Company revenue where a customer used a digital tool within the last 90 days 76% adoption rate Met goal, with a 77.5% adoption rate Human Capital Employee Safety: Total Recordable Incident Rate (“TRIR”) TRIR at or below .65 Fell short of stretch goal with 0.75 TRIR; however, we improved 7.4% year-over-year against strong performance in 2024 Employee Engagement: Employee engagement Net Promoter (“eNPS”) survey results Overall eNPS remains in the top 10% of the Peakon Benchmark Met goal; earned overall eNPS in the top 5% or 10% of the Peakon Benchmark for all surveys conducted during 2025 Employee Retention: Improvement in overall employee retention Voluntary turnover at or below 11.5% Met goal, with 10.8% voluntary turnover 49 Based on the NEOs’ collective achievements against the metrics in the framework, the Committee may, in its own discretion, decide to adjust each NEO’s funding level upward or downward in the range of 90% to 110% of the initial funding amount.
2026 proxy, filed 2026-03-25; 2025 customer NPS, digital-adoption definition and strategic achievements · Filed 25/03/2026
Adjusted EBITDA margin(2) decreased 120 basis points to 45.5%, primarily reflecting 1) decreased gross margin from equipment rentals (excluding depreciation and stock compensation expense) and 2) decreased gross margin from sales of rental equipment (excluding the adjustment for the impact of the fair value mark-up of acquired fleet), which primarily reflected the normalization of the used equipment market, including pricing, partially offset by 3) the impact of the H&E break-up fee.
2026 proxy, filed 2026-03-25; 2025 margin decline and used-equipment pricing normalization · Filed 25/03/2026
A portion of inflationary cost increases is passed on to customers.
June 2026 Form 10-Q, filed 2026-07-22; partial inflation pass-through · Filed 22/07/2026
The most significant cost increases that are passed on to customers are for fuel and delivery, and there are other costs for which the pass through to customers is less direct, such as repairs and maintenance, and labor.
June 2026 Form 10-Q, filed 2026-07-22; fuel, delivery and less-direct cost pass-through · Filed 22/07/2026
As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date.
June 2026 Form 10-Q, filed 2026-07-22; contractual payments based on actual rental period · Filed 22/07/2026
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (In millions) Six Months Ended June 30, 2026 2025 Cash Flows From Operating Activities: Net income $ 1,284 $ 1,140 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,615 1,510 Amortization of deferred financing costs and original issue discounts 8 8 Gain on sales of rental equipment (314) (313) Gain on sales of non-rental equipment (7) (10) Gain on sale of business (1) (49) — Insurance proceeds from damaged equipment (23) (23) Stock compensation expense, net 79 70 Restructuring charge 51 1 Debt related activity (2) — 13 Increase (decrease) in deferred taxes 220 (38) Changes in operating assets and liabilities, net of amounts acquired: (Increase) decrease in accounts receivable (272) 5 Increase in inventory (54) (41) Decrease (increase) in prepaid expenses and other assets 30 (114) Increase in accounts payable 623 529 Increase in accrued expenses and other liabilities 114 16 Net cash provided by operating activities 3,305 2,753 Cash Flows From Investing Activities: Payments for purchases of rental equipment (2,720) (2,121) Payments for purchases of non-rental equipment and intangible assets (165) (182) Proceeds from sales of rental equipment 680 694 Proceeds from sales of non-rental equipment 26 31 Insurance proceeds from damaged equipment 23 23 Purchases of other companies, net of cash acquired (400) (16) Proceeds from sale of business (1) 82 — Purchases of investments — (1) Proceeds from sales of investments 3 — Net cash used in investing activities (2,471) (1,572) Cash Flows From Financing Activities: Proceeds from debt 4,503 4,829 Payments of debt (4,594) (4,952) Payment of contingent consideration (18) (23) Common stock repurchased, including tax withholdings for share-based compensation (816) (720) Payments of financing and other debt related costs (2) (1) (14) Dividends paid (248) (235) Net cash used in financing activities (1,174) (1,115) Effect of foreign exchange rates (7) 25 Net (decrease) increase in cash and cash equivalents (347) 91 Cash and cash equivalents at beginning of period 459 457 Cash and cash equivalents at end of period $ 112 $ 548 Supplemental disclosure of cash flow information: Cash paid for income taxes, net $ 158 $ 540 Cash paid for interest 342 339 11 Table of Contents (1)See note 3 to the condensed consolidated financial statements for a discussion of the gain recognized upon sale of part of our scaffolding business.
June 2026 Form 10-Q, filed 2026-07-22; unaudited cash flows, six months ended June 30, in millions · Filed 22/07/2026
2025 Performance Metrics ($M) Payout Level % of Target Total Revenue (50% weighting)(1) ROIC (50% weighting)(1) Maximum 200% $16,598 13.47% Target(2) 100% $15,881 12.29% Threshold 50% $14,626 10.18% Actual(1) $16,114 11.72% 132.6% of Target 86.5% of Target Earned Amount 109.5% of Target (1) For purposes of the PRSUs, total revenue and ROIC include an adjustment to normalize for the foreign exchange rate impact, and ROIC includes an additional adjustment to neutralize the financial impact of the termination of the H&E acquisition, comprised of the transaction termination fee net of associated expenses.
2026 proxy, filed 2026-03-25; actual 2025 PRSU metrics, equal revenue/ROIC weights and adjustment footnote · Filed 25/03/2026
These PRSUs were settled in shares of the Company’s common stock in the first quarter of 2026.
2026 proxy, filed 2026-03-25; actual first-quarter 2026 share settlement of PRSUs · Filed 25/03/2026
Because our PRSU goals are set on an annual basis, the grant date and associated award fair value are established annually over the three-year performance period—resulting in differences between what is reported in the Summary Compensation Table (further described in footnote 4 thereto) and the amount of the award the Committee originally awarded.
2026 proxy, filed 2026-03-25; annual goal setting within three-year PRSU performance periods · Filed 25/03/2026
Until the applicable guideline level of ownership is met, the officers are required to retain 50% of the net shares of the Company’s common stock received upon the exercise, vesting or payment of equity-based awards.
2026 proxy, filed 2026-03-25; officer net-share retention requirement · Filed 25/03/2026
Each of our NEOs was in compliance with such guidelines when their holdings were measured as of December 31, 2025.
2026 proxy, filed 2026-03-25; NEO ownership-guideline compliance at December 31, 2025 · Filed 25/03/2026
The Dodd-Frank Clawback Policy requires the Company to recoup any erroneously awarded incentive-based compensation received by certain executives, including each NEO, in the event the Company is required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under the federal securities laws.
2026 proxy, filed 2026-03-25; mandatory financial-restatement compensation recovery · Filed 25/03/2026
Board Independence and Accountability Board Performance • Annual Election of Directors by Majority Vote • Risk Oversight • 9 of 11 Nominees are Independent • Robust Board Evaluations • Required Committees are Fully Independent • Commitment to Board Refreshment • Separate Chair and CEO, with a Lead Independent Director • Focus on Management Succession Planning Other Board and Board Committee Practices Stockholder Rights • No Hedging or Pledging of Company Shares • No Supermajority Voting Requirements • Robust Stock Ownership Guidelines • Stockholder Right to Call Special Meetings • Authority to Retain Outside Advisors • Stockholder Right to Act by Written Consent • Director Retirement Age Policy • Proxy Access • Director Overboarding Policy • No Poison Pill Investor Engagement We value our investors’ perspective on our business and each year we proactively interact with investors through numerous engagement activities.
2026 proxy, filed 2026-03-25; committee independence, board structure and stockholder rights · Filed 25/03/2026
1
Board Leadership Structure
Our current Board of Directors (“Board”) leadership structure consists of our non-executive Chair; Lead Independent Director; and President and Chief Executive Officer (“CEO”).
2026 proxy, filed 2026-03-25; current non-executive Chair, Lead Independent Director and CEO structure · Filed 25/03/2026
The stockholders (i) elected all eleven directors; (ii) approved the ratification of the appointment of Ernst & Young LLP for the fiscal year ending December 31, 2026; (iii) approved (on a non-binding basis) the compensation of the Company’s named executive officers; and (iv) rejected a stockholder proposal on directors who fail to obtain a majority vote.
Annual-meeting Form 8-K, filed 2026-05-08; actual director elections and advisory compensation vote · Filed 08/05/2026
We opened 60 specialty branch locations during the year and increased the size of our business to 1,768 global branches as of December 31, 2025.
2026 proxy, filed 2026-03-25; 60 specialty openings and year-end 2025 branch count · Filed 25/03/2026
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (In millions, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Revenues: Equipment rentals $ 3,849 $ 3,415 $ 7,268 $ 6,560 Sales of rental equipment 330 317 680 694 Sales of new equipment 86 75 170 145 Contractor supplies sales 44 41 84 77 Service and other revenues 101 95 193 186 Total revenues 4,410 3,943 8,395 7,662 Cost of revenues: Cost of equipment rentals, excluding depreciation 1,644 1,443 3,136 2,821 Depreciation of rental equipment 704 651 1,385 1,288 Cost of rental equipment sales 176 171 366 381 Cost of new equipment sales 68 61 138 117 Cost of contractor supplies sales 30 28 58 54 Cost of service and other revenues 56 56 111 112 Total cost of revenues 2,678 2,410 5,194 4,773 Gross profit 1,732 1,533 3,201 2,889 Selling, general and administrative expenses 472 422 913 859 Restructuring charge 6 — 51 1 Non-rental depreciation and amortization 116 108 230 222 Operating income 1,138 1,003 2,007 1,807 Interest expense, net 178 171 354 355 Other income, net (47) (7) (55) (75) Income before provision for income taxes 1,007 839 1,708 1,527 Provision for income taxes 254 217 424 387 Net income $ 753 $ 622 $ 1,284 $ 1,140 Basic earnings per share $ 12.04 $ 9.59 $ 20.47 $ 17.51 Diluted earnings per share $ 12.03 $ 9.59 $ 20.44 $ 17.48 See accompanying notes.
June 2026 Form 10-Q, filed 2026-07-22; unaudited income statements, in millions except per-share amounts · Filed 22/07/2026
•Capital management. The company’s net leverage ratio was 1.8x at June 30, 2026, as compared to 1.9x at December 31, 2025.
Second-quarter 2026 earnings release, filed 2026-07-22; net leverage at June 30, 2026 versus December 31, 2025 · Filed 22/07/2026
6.The net leverage ratio reflects net debt (total debt less cash and cash equivalents) divided by adjusted EBITDA for the trailing 12 months.
Second-quarter 2026 earnings release, filed 2026-07-22; net-leverage denominator and definition · Filed 22/07/2026
At year-end, our net leverage ratio was 1.9x, which was within our leverage target range of 1.5x-2.5x, and we had total liquidity of $3.3 billion.
2026 proxy, filed 2026-03-25; year-end 2025 leverage target range and liquidity · Filed 25/03/2026
5.Fleet productivity reflects the combined impact of changes in rental rates, time utilization and mix on owned equipment rental revenue.
Second-quarter 2026 earnings release, filed 2026-07-22; fleet productivity combines rates, utilization and mix · Filed 22/07/2026
During the six months ended June 30, 2026, the company repurchased $750 million of common stock under these programs, and paid dividends totaling $248 million.
Second-quarter 2026 earnings release, filed 2026-07-22; actual first-half program repurchases and dividends · Filed 22/07/2026
All references to share repurchases above do not include the excise tax, which totaled $6 million year-to-date through June 30, 2026.
Second-quarter 2026 earnings release, filed 2026-07-22; repurchase amounts exclude year-to-date excise tax · Filed 22/07/2026
This margin decline primarily reflects decreased rental gross margin in the specialty rentals segment, attributable to changes in revenue mix driven by growth in lower-margin ancillary and re-rent revenues, partially offset by a reduction in labor and benefits expenses as a percentage of revenue, as discussed below.
Second-quarter 2026 earnings release, filed 2026-07-22; underlying adjusted EBITDA margin-decline drivers · Filed 22/07/2026
