Hertz Global (NasdaqGS:HTZ) Q3 2025 Earnings Call November 04, 2025 09:00 AM ET Speaker4Welcome to Hertz Global Holdings' third quarter 2025 earnings call. Currently, all lines are in listen-only mode. Following management's commentary, we will conduct a question-and-answer session. 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 our host, Johann Rawlinson, Vice President of Investor Relations. Please go ahead.Speaker1Good morni ...

Core Insights - Hertz's "Back-to-Basics Roadmap" is effectively enhancing operational performance and establishing a stronger financial foundation, focusing on fleet management, revenue optimization, and cost efficiency [4][8][14] Financial Performance - In Q1 2025, total revenues decreased by 13% year-over-year to $1.813 billion, primarily due to reduced fleet capacity [21] - Net loss for Q1 2025 was $443 million, compared to a loss of $186 million in Q1 2024 [21] - Adjusted Corporate EBITDA improved to a loss of $325 million, a 43% year-over-year improvement [21][38] Fleet Management Strategy - Hertz has rotated into a newer, more efficient fleet, with over 70% of its core U.S. rental fleet being 12 months old or less [9][14] - Vehicle depreciation decreased by 45% year-over-year, with depreciation per unit (DPU) for Q1 2025 at $353, down from $588 [8][21] - The company aims to achieve a DPU below $300 by Q2 2025, ahead of its previous guidance [8][14] Revenue and Demand Environment - Revenue per unit (RPU) declined by 3% year-over-year to $1,264, influenced by seasonal factors and a shift in fleet mix [11][21] - Vehicle utilization increased by 240 basis points year-over-year to 79% [11][21] - Forward bookings for leisure rentals are up year-over-year, while demand for corporate and government segments has moderated [12] Cost Management - Direct operating expenses improved by $92 million year-over-year due to cost control initiatives [14][17] - The company is partnering with an AI-driven vehicle inspection system to enhance maintenance efficiency and customer experience [17] Recent Transactions and Financial Position - Hertz extended the maturity of $1.7 billion of its First Lien revolving credit facility to June 2028, improving its capital structure [19][20] - As of March 31, 2025, Hertz had $1.2 billion in corporate liquidity [14] Customer Experience and Loyalty - Net Promoter Scores improved by 11 points year-over-year, indicating enhanced customer satisfaction [16] - Loyalty enrollments increased by 11% year-over-year, contributing to a rise in loyalty bookings [16]

Financial Commitments - The company has successfully extended approximately $1.665 billion of commitments under its First Lien Revolving Credit Facility, $2.860 billion under HVF III U.S. Vehicle Variable Funding Notes, and €1.160 billion under European ABS [1][7] - The maturity date for the revolving credit facility has been extended from June 30, 2026, to March 31, 2028, allowing access to up to $2.0 billion until June 30, 2026, and $1.665 billion thereafter [7] - The commitment termination date for HVF III U.S. Vehicle Variable Funding Notes has been extended by one year to May 7, 2027, with a maximum principal amount available of $3.640 billion until April 10, 2026, and $2.860 billion thereafter [7] - The maturity date for €1.160 billion of Class A notes under the European ABS has been extended to April 30, 2027, with remaining commitments of €1.289 billion until March 31, 2026 [7] Strategic Positioning - The extensions of financial commitments are aimed at strengthening the company's financial foundation and enhancing strategic flexibility [1][2] - The company is positioned to continue executing its strategic plan focused on disciplined fleet management, revenue optimization, and rigorous cost control [1][2] - The CEO emphasized that these extensions reflect the confidence lenders have in the company's ability to transform and achieve long-term goals [2] Company Overview - Hertz Global Holdings Inc. is a leading car rental and mobility solutions provider, operating brands such as Hertz, Dollar, Thrifty, and Firefly with over 11,000 rental locations in 160 countries [4] - The company also offers used cars for sale through Hertz Car Sales and operates a car-sharing business in Europe [4]