Q2 2025 Financial Performance - Revenue decreased by 7% year-over-year, from $2.4 billion in Q2 2024 to $2.2 billion in Q2 2025, driven by lower fleet and pricing[10] - RPU decreased by 2% year-over-year, from $1,425 in Q2 2024 to $1,400 in Q2 2025, but was flat excluding fleet mix impact[10] - RPD decreased by 5% year-over-year, from $58.80 in Q2 2024 to $55.65 in Q2 2025, driven by market pricing and fleet mix shift[10] - DPU decreased significantly by 58% year-over-year, from $595 in Q2 2024 to $251 in Q2 2025, exceeding the North Star target by 16%[10] - Adjusted Corporate EBITDA improved from $(460) million in Q2 2024 to $1 million in Q2 2025, driven by lower vehicle depreciation and DOE[10] - Adjusted Free Cash Flow increased from $(553) million in Q2 2024 to $327 million in Q2 2025, driven by profitability improvement and increased vehicle funding advance rates[10] Operational Metrics - Transaction Days decreased by 3% year-over-year, from 39.7 million in Q2 2024 to 38.7 million in Q2 2025, reflecting strategic fleet reduction[10] - Average Fleet decreased by 6% year-over-year, from 577,000 in Q2 2024 to 543,000 in Q2 2025, aligning fleet size with demand[10] - Vehicle Utilization improved by 300 bps year-over-year, from 80% in Q2 2024 to 83% in Q2 2025, driven by fleet management and improved operations[10] - DOE per Transaction Day decreased by 1% year-over-year, from $36.25 in Q2 2024 to $36.03 in Q2 2025, driven by cost discipline and productivity[10]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $1.8 billion, with adjusted EBITDA loss of $325 million, an improvement from a loss of $567 million in the prior year, resulting in a 9% margin improvement year over year [32][34] - Depreciation per unit (DPU) decreased by 45% year over year, with DPU for the quarter at $353 per month, and expectations to drop below $300 in Q2 2025 [34][35] - Direct operating expenses (DOE) per day decreased by 4% quarter over quarter and 1% year over year on a volume-adjusted basis [35] Business Line Data and Key Metrics Changes - The fleet was down 8% year over year, with a focus on tighter fleet management to capitalize on strong residual values [22][43] - Retail car sales saw a record quarter, with an increase in average selling price through the retail channel positively impacting depreciation per unit [15][16] - The company is focusing on increasing net margins by managing reconditioning costs and capturing more finance and insurance commissions [16] Market Data and Key Metrics Changes - Overall demand remains solid, but there are potential macroeconomic headwinds; corporate, government, and US inbound segments are moderating, while leisure bookings are up year over year [25][61] - The rental car index for April was up 8%, indicating rising residual values in the wholesale market [56] Company Strategy and Development Direction - The company is focused on disciplined fleet management, revenue optimization, and rigorous cost management as part of its transformation strategy [7][8] - The strategy includes a shift towards a younger fleet, with over 70% of the core US rental fleet being 12 months old or newer, aimed at reducing costs and improving utilization [10][12] - The company is leveraging technology partnerships to enhance fleet management and customer experience, including collaborations with Palantir and Amadeus [18][19] Management's Comments on Operating Environment and Future Outlook - Management acknowledges macroeconomic uncertainties but remains confident in the company's strategy and ability to adapt [20][46] - The company expects to achieve its North Star metrics, which could unlock over $1 billion of EBITDA run rate by 2026 [45][47] - Management is optimistic about rising residual values and solid demand, particularly in leisure segments, while remaining cautious about potential headwinds [47][42] Other Important Information - The company amended its revolving credit facility, extending the maturity date and maintaining strong liquidity of $1.2 billion at the end of Q1 [36][37] - The company is pursuing various transactions to optimize liquidity, including an ATM equity offering to start deleveraging [41][40] Q&A Session Summary Question: About fleet overfitting and residuals in retail vs wholesale - Management clarified that while there was temporary overfitting at the local market level due to early vehicle deliveries, overall fleet management remains tight [52][54] - Residual values are rising, with retail sales skewed towards higher values, and wholesale markets showing quicker price movements [55][56] Question: Geographic demand variations and corporate spending - Management noted no major geographic differences in demand but acknowledged a dip in corporate and government segments, with seasonal demand expected to pick up [60][61] Question: Fleet activity in April and May - The company continues to take deliveries and expects a mid to high single-digit increase in fleet size in Q2 compared to Q1 [66] Question: Balance of cost-cutting and revenue generation - Management emphasized the importance of maintaining customer experience while controlling costs, with improvements in Net Promoter Scores indicating success in this area [72][73] Question: Fleet strategy and RPD - The company is focusing on diversifying revenue streams and improving unit economics, with a tighter fleet aimed at producing more demand than can be satisfied [78][82]

HERTZ GLOBAL HOLDINGS, INC. Q1 2025 EARNINGS PRESENTATION IMPORTANT DISCLOSURES FORWARD-LOOKING STATEMENTS Certain statements made within this presentation contain forward-looking statements. Forward-looking statements are not guarantees of future performance and by their nature are subject to inherent uncertainties. Actual results may differ materially. Any forward-looking information relayed in this presentation speaks only as of May 13, 2025, and Hertz Global Holdings, Inc. ("Hertz Global" or the "Compan ...

Core Viewpoint - Bill Ackman, a prominent hedge fund manager, has invested in Hertz Global Holdings, leading to a significant increase in the stock price, with expectations of further growth by 2029 [2][3]. Group 1: Investment Rationale - Ackman believes that current tariffs could positively impact Hertz by increasing the value of its vehicle fleet, potentially adding $1.2 billion to its value due to a 10% rise in used car prices [5]. - The company operates a fleet of approximately 500,000 vehicles valued at $12 billion, and Ackman aligns with management's revenue targets of $1,500 per vehicle per month, suggesting achievable growth [6]. - If tariffs lead to higher rental demand, Hertz could increase rental prices and reinvest profits to enhance its fleet [7]. Group 2: Financial Projections - Ackman projects that by 2029, Hertz could generate $2 billion in annual adjusted EBITDA, valuing the company at $15 billion with a target share price of around $30 [8]. Group 3: Market Dynamics - Hertz's stock is heavily shorted, with about 50% of its float sold short, which could lead to a short squeeze if the stock price rises rapidly due to covering by short sellers [10][12]. - The potential for a short squeeze is heightened by Ackman's influence as an activist investor, which could lead to significant price movements following positive quarterly results [13]. Group 4: Current Investment Sentiment - Despite Ackman's involvement adding credibility, uncertainties remain regarding Hertz's ability to sustain growth and the long-term impact of tariffs, leading to a cautious outlook on the stock [14][15].

Avis Budget Group (CAR) - Wall Street anticipates a year-over-year decline in earnings for Avis Budget Group, with an expected loss of $5.56 per share, reflecting a -73.2% change, and revenues projected at $2.52 billion, down 1.2% from the previous year [3][12] - The consensus EPS estimate has remained unchanged over the last 30 days, indicating a stable outlook among analysts [4] - The Most Accurate Estimate for Avis Budget is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -6.54%, suggesting a bearish sentiment among analysts [10][11] Earnings Expectations - The upcoming earnings report is scheduled for May 7, and the stock may react positively if actual results exceed expectations, while a miss could lead to a decline [2] - Historical performance shows that Avis Budget has beaten consensus EPS estimates only once in the last four quarters, with a notable surprise of +76.04% in the last reported quarter [12][13] Comparison with Industry Peers - In contrast, Expeditors International (EXPD) is expected to report earnings of $1.30 per share, indicating a year-over-year increase of +11.1%, with revenues projected at $2.43 billion, up 9.9% from the previous year [17] - Expeditors International has an Earnings ESP of 3.76%, suggesting a higher likelihood of beating the consensus EPS estimate, having surpassed estimates three times in the last four quarters [18]