Hertz Q3 2026 Earnings: Pricing Lifts Revenue as GAAP Profit Falls

Hertz Global Holdings (NASDAQ: HTZ) reported Q3 2026 revenue of $2.617 billion, up 6% from $2.478 billion a year earlier, while diluted GAAP EPS fell to $0.20 from $0.42. Adjusted Corporate EBITDA rose 15% to $233 million as higher rental pricing improved operating economics, but International weakness and difficult comparisons with prior-year legal and asset-related gains weighed on GAAP profit.

Core Earnings Results

For the quarter ended September 30, revenue growth came primarily from pricing rather than higher rental volume. Revenue per day (RPD) and revenue per unit (RPU) both increased approximately 5%, while transaction days were essentially unchanged and average vehicles increased 1%.

Adjusted results improved more clearly than GAAP earnings. Adjusted net income rose 26%, and Adjusted Corporate EBITDA margin expanded by one percentage point, giving Hertz its highest quarterly revenue and Adjusted Corporate EBITDA in three years.

Hertz revised its definitions of Adjusted Net Income and Adjusted Corporate EBITDA in Q1 2026 to exclude additional items, including realized financial-instrument gains or losses, share-based compensation and foreign-currency gains or losses. Prior-year figures were recast to the new definition.

Business and Segment Performance

The Americas rental segment drove the quarter’s growth. Its revenue rose 7% and adjusted EBITDA increased 23%, supported by pricing: Americas RPD increased 7%, while RPU gained 6%. Hertz’s core U.S. business performed even better on price, with RPD up approximately 8% despite lower TSA volumes.

International results were weaker. Revenue increased only 1%, while RPD and RPU each declined 1%. Higher depreciation contributed to a 9% decrease in International adjusted EBITDA and a two-percentage-point margin contraction.

Americas transaction days were flat, reinforcing that pricing—not additional rental days—was the main revenue driver. International transaction days increased 1%, but lower revenue per day limited the benefit.

Profitability, Fleet Costs, and Liquidity

Adjusted direct operating expense per transaction day increased approximately 5% to $37.72. Hertz attributed about 240 basis points of the increase to revenue-related expenses associated with higher pricing, while the remainder primarily reflected elevated collision and maintenance costs and broader inflation.

Even with those pressures, the dollar spread between RPD and adjusted direct operating expense per day improved by $1.36 globally, or approximately 5%. The improvement exceeded $2.50 in the U.S., indicating that higher pricing continued to outpace incremental operating costs in absolute dollar terms.

Net depreciation per unit per month was $285, up 2% from $279 and consistent with the company’s expectations. The average age of the U.S. core fleet was nine months, its youngest in 12 years. International depreciation per unit was less favorable, rising 7% to $302.

Hertz ended the quarter with approximately $946 million of liquidity, including cash and cash equivalents plus available revolving-credit capacity. The release did not provide quarterly operating or free cash flow figures.

Prior-Year Legal and Asset Gains Obscured Better Adjusted Operations

The divergence between falling GAAP earnings and improving adjusted results was a central feature of the quarter. Pretax income declined to $87 million from $234 million even though revenue and Adjusted Corporate EBITDA increased.

The prior-year quarter included a $154 million legal-settlement benefit and a $39 million gain on the sale of non-vehicle capital assets. Q3 2026 recorded only a $6 million legal-settlement benefit and no comparable asset-sale gain. A $19 million gain from the change in fair value of public warrants and a $29 million income-tax benefit partly cushioned the current quarter, but they did not offset the tougher comparison.

This explains why GAAP net income fell 37% while adjusted net income increased 26%. It also means GAAP earnings may remain volatile when warrant valuations, taxes, legal items or asset-sale gains change between periods.

Management’s View

Management attributed the operating improvement to stronger demand generation, more sophisticated pricing and disciplined local fleet management. Hertz is also working to reduce repair costs, increase labor productivity and vehicle utilization, and strengthen damage recovery and collections in response to collision and maintenance pressure.

Beyond the core rental business, the company is expanding its franchise model and developing revenue sources across service, fleet and mobility. Oro Mobility recently secured an $80 million strategic equity investment, while Hertz retained majority economic ownership and remained Oro’s fleet and corporate-services partner. Oro’s managed fleet has completed more than 10 million miles, and its first autonomous-vehicle partnership is underway in the San Francisco Bay Area.

Recent Insider Transactions

Recent insider records were dominated by equity compensation rather than discretionary open-market purchases. Of the 10 latest reported transactions in the supplied data, nine were stock awards and one was a sale, so the awards should not be interpreted as direct insider buying.

The separate six-month summary reported one sale covering 40,919 shares. No conclusion about management’s outlook can be drawn from that transaction alone.

Risks Investors Should Monitor

• Reliance on pricing: Consolidated transaction days were flat, and the U.S. core business achieved higher pricing despite lower TSA volumes. Revenue growth could become harder to sustain if pricing weakens without a volume recovery.
• Operating-cost pressure: Collision, maintenance and inflation increased direct operating costs. Continued cost growth could narrow the improved spread between rental pricing and daily operating expense.
• International weakness: International RPD and RPU declined, adjusted EBITDA fell 9%, and depreciation per unit rose 7%. Further deterioration would offset part of the Americas improvement.
• Fleet depreciation and residual values: Hertz’s economics depend on purchasing and disposing of vehicles at favorable prices. Although consolidated depreciation remained near expectations, the International increase shows that fleet costs can vary materially by region.
• GAAP earnings volatility: Legal settlements, asset disposals, public-warrant valuations and tax items produced a substantial difference between GAAP and adjusted results this quarter.

Summary

Hertz’s Q3 2026 operating performance improved as higher rental pricing lifted revenue and expanded adjusted EBITDA margins, with the Americas providing most of the momentum. The main offsets were weaker International profitability, rising collision and maintenance costs, and a sharp GAAP profit decline caused largely by difficult comparisons with prior-year legal and asset-sale benefits. Future quarters will show whether Hertz can preserve its pricing-cost spread while improving volume and stabilizing International fleet economics.