Hertz Transformation Drives Structural Revenue Gains and Builds Sustainable Momentum
ESTERO, Fla.--( BUSINESS WIRE)--Hertz Global Holdings, Inc. (NASDAQ: HTZ) ("Hertz," "Hertz Global," or the "Company") today reported results for its fourth quarter and full year 2025.
Q4 AND FULL YEAR 2025 HIGHLIGHTS
Transitory Q4 Headwinds
A number of compounding external events impacted EBITDA in the fourth quarter by more than $100 million. This included a government shutdown coupled with FAA flight cancellations, multiple technology vendor outages, and a nearly 3 times higher than normal level of vehicles on recall.
DPU was in line with the Company’s full-year North Star target, but above its quarterly target due to a revised Black Book residual outlook and softer seasonal wholesale pricing amid elevated OEM and rental de-fleeting activity. This resulted in an approximately $60 million non-cash depreciation charge. Looking ahead, the Company sees a more normalized residual value outlook for 2026.
Excluding these items, our core EBITDA production was in line with our expectations, reflecting continued progress on our revenue and cost initiatives.
2025 Summary
2025 was a critical year in the Hertz transformation, and underscored that the structural improvements the Company is making are permanent while the headwinds it faces are transitory. The traditional rental car business is improving, guided by its North Star metrics of DPU sub $300, RPU over $1,500, and DOE per transaction day in the low $30s.
Over the course of the year, Hertz completed its fleet rotation and successfully secured model year 2026 buys at its target prices and volumes. This enabled model year 2025 sales through Hertz Car Sales, continuing the Company’s short-hold strategy and introducing a richer, more optimized car-class mix to its fleet. Hertz's average fleet age was less than ten months and the lowest its been in almost a decade.
Through these actions, Hertz achieved a full year EBITDA improvement of more than $1 billion year over year. The Company drove sequential improvements in revenue, RPU, and RPD, while also improving utilization and driving DPU down in line with the North Star target. Hertz also brought DOE per transaction day down despite lower volumes and saw a nearly 50% improvement in customer satisfaction – a result of an intentional effort to improve operations and customer experience.
Q1 2026 Insights
Hertz’s early first quarter performance indicates that its commercial strategy continues to deliver sustained value in 2026. January revenue results show meaningful improvement year over year, with February trending more positively and March continuing that trajectory. The Company expects a mid-single digit increase in revenue for the quarter, supported by a constructive demand environment and increased year-over-year RPD. With respect to the fleet, the Company also sees signs that residual values are improving from Q4’s seasonal lows. Looking ahead to the rest of the year, the Company remains focused on growing the off-airport and mobility business and accelerating revenue growth while staying disciplined on costs.
Platform for Growth
The Company is building on the transformation of the core rental car business by establishing a diversified, value-creating platform for growth. This platform spans four strategic areas – Rent-a-Car, Service, Fleet, and Mobility – each with unique potential to scale. The Company is focused on developing capabilities across its platform, including continuing the digital evolution of Hertz Car Sales in Fleet, exploring growth and franchise opportunities in Rent-a-Car, piloting new offerings in Service, and expanding revenue channels, assets, and capabilities in Mobility.
EARNINGS WEBCAST INFORMATION
Hertz Global's live webcast and conference call to discuss its fourth quarter and full year 2025 results will be held on February 26, 2026 at 9:00 a.m. Eastern Time. The conference call will be broadcast live in listen-only mode on the Company’s Investor Relations website at IR.Hertz.com. If you would like to access the call by phone and ask a question, please go to https://events.q4inc.com/analyst/447223111?pwd=dj5kBgTF, and you will be provided with dial in details. Investors are encouraged to dial in approximately 15 minutes prior to the call. A web replay will remain available on the website for approximately one year. The earnings release and related supplemental schedules containing the reconciliations of non-GAAP measures will be available on the Hertz website, IR.Hertz.com.
ABOUT HERTZ
Hertz Global Holdings, Inc. is one of the world’s leading car rental and mobility solutions providers. Its subsidiaries, including The Hertz Corporation, and licensees operate the Hertz, Dollar, Thrifty, and Firefly vehicle rental brands, with approximately 11,000 rental locations in 160 countries around the globe. The Company also operates the Hertz Car Sales brand, which offers a range of quality, competitively priced used cars for sale online and at locations across the United States, and the Hertz 24/7 car-sharing business in Europe. For more information about Hertz, visit www.hertz.com.
SUMMARY RESULTS
Three Months Ended
December 31,
Percent
Inc/(Dec)
2025 vs 2024
($ in millions, except earnings per share or where noted)
2025
2024
Hertz Global - Consolidated
Total revenues
$
2,028
$
2,040
(1)%
Net income (loss)
$
(194
)
$
(479
)
(59)%
Diluted earnings (loss) per share
$
(0.72
)
$
(1.56
)
(54)%
Net income (loss) margin
(10
)%
(23
)%
Adjusted net income (loss) (a)
$
(252
)
$
(362
)
(30)%
Adjusted diluted earnings (loss) per share (a)
$
(0.63
)
$
(1.18
)
(47)%
Adjusted Corporate EBITDA (a)
$
(205
)
$
(357
)
(43)%
Adjusted Corporate EBITDA Margin (a)
(10
)%
(18
)%
Average Vehicles (in whole units)
516,867
532,884
(3)%
Average Rentable Vehicles (in whole units)
498,120
497,875
—%
Vehicle Utilization
78
%
79
%
Transaction Days (in thousands)
35,804
35,998
(1)%
Total RPD (in dollars) (b)
$
55.67
$
56.27
(1)%
Total RPU Per Month (in whole dollars) (b)
$
1,334
$
1,356
(2)%
Depreciation Per Unit Per Month (in whole dollars) (b)
$
330
$
418
(21)%
Adjusted DOE per Transaction Day (in dollars) (b)
$
36.39
$
38.81
(6)%
Americas RAC Segment
Total revenues
$
1,621
$
1,669
(3)%
Adjusted EBITDA
$
(128
)
$
(297
)
(57)%
Adjusted EBITDA Margin
(8
)%
(18
)%
Average Vehicles (in whole units)
415,264
432,909
(4)%
Average Rentable Vehicles (in whole units)
398,106
399,927
—%
Vehicle Utilization
79
%
80
%
Transaction Days (in thousands)
28,857
29,298
(2)%
Total RPD (in dollars) (b)
$
56.11
$
56.89
(1)%
Total RPU Per Month (in whole dollars) (b)
$
1,356
$
1,389
(2)%
Depreciation Per Unit Per Month (in whole dollars) (b)
$
346
$
458
(24)%
Adjusted DOE per Transaction Day (in dollars) (b)
$
36.94
$
39.73
(7)%
International RAC Segment
Total revenues
$
407
$
371
10%
Adjusted EBITDA
$
(1
)
$
1
NM
Adjusted EBITDA Margin
—
%
—
%
Average Vehicles (in whole units)
101,603
99,975
2%
Average Rentable Vehicles (in whole units)
100,013
97,948
2%
Vehicle Utilization
75
%
74
%
Transaction Days (in thousands)
6,948
6,700
4%
Total RPD (in dollars) (b)
$
53.89
$
53.57
1%
Total RPU Per Month (in whole dollars) (b)
$
1,248
$
1,221
2%
Depreciation Per Unit Per Month (in whole dollars) (b)
$
263
$
241
9%
Adjusted DOE per Transaction Day (in dollars) (b)
$
34.54
$
34.78
(1)%
(a)
Represents a non-GAAP measure. See the accompanying reconciliations included in Supplemental Schedule II for 2025 and 2024.
(b)
Based on December 31, 2024 foreign exchange rates.
UNAUDITED FINANCIAL DATA, SUPPLEMENTAL SCHEDULES, NON-GAAP MEASURES AND DEFINITIONS
In this earnings release, we include select unaudited financial data of Hertz Global, Supplemental Schedules, which are provided to present segment results, and reconciliations of non-GAAP measures to their most comparable GAAP measures. Following the Supplemental Schedules, the Company provides definitions for terminology used throughout the earnings release and the Company’s rationale regarding the importance and usefulness of non-GAAP measures for investors and management.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained or incorporated by reference in this release, and in related comments by the Company's management, include “forward-looking statements.” Forward-looking statements are identified by words such as "believe," "expect," "project," "potential," "anticipate," "intend," "plan," "estimate," "seek," "will," "may," "would," "should," "could," "forecasts," "guidance" or similar expressions, and include information concerning our liquidity, our results of operations, our business strategies, economic and industry conditions and other information. These forward-looking statements are based on certain assumptions that the Company has made in light of its experience in the industry, as well as its perceptions of historical trends, current conditions, expected future developments and other factors. The Company believes these judgments are reasonable, but you should understand that these forward-looking statements are not guarantees of future performance or results, and that the Company’s actual results could differ materially from those expressed in the forward-looking statements due to a variety of important factors, both positive and negative, that may be revised or supplemented in subsequent reports, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed or furnished to the SEC.
Important factors that could affect the Company's actual results and cause them to differ materially from those expressed in forward-looking statements include, among other things.
Additional information concerning these and other factors can be found in the Company's filings with the SEC, including its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
You should not place undue reliance on forward-looking statements. All forward-looking statements attributable to the Company, or persons acting on its behalf, are expressly qualified in their entirety by the foregoing cautionary statements. All such statements speak only as of the date of this release, and, except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
UNAUDITED FINANCIAL INFORMATION
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
December 31,
Twelve Months Ended
December 31,
(In millions, except per share data)
2025
2024
2025
2024
Revenues
$
2,028
$
2,040
$
8,504
$
9,049
Expenses:
Direct vehicle and operating
1,367
1,413
5,489
5,689
Depreciation of revenue earning vehicles and lease charges, net
520
670
1,927
3,611
Depreciation and amortization of non-vehicle assets
29
32
117
139
Selling, general and administrative
251
225
957
819
Interest expense, net:
Vehicle
155
143
608
590
Non-vehicle
24
117
469
369
Total interest expense, net
179
260
1,077
959
Other (income) expense, net
(5
)
2
(3
)
4
(Gain) on sale of non-vehicle capital assets
(16
)
—
(144
)
—
Legal settlement
—
—
(154
)
—
Bankruptcy-related litigation reserve
12
4
24
292
Long-Lived Assets impairment
—
—
—
1,048
Change in fair value of Public Warrants
(86
)
(3
)
44
(275
)
Total expenses
2,251
2,603
9,334
12,286
Income (loss) before income taxes
(223
)
(563
)
(830
)
(3,237
)
Income tax (provision) benefit
29
84
83
375
Net income (loss)
$
(194
)
$
(479
)
$
(747
)
$
(2,862
)
Weighted average number of shares outstanding:
Basic
312
307
310
306
Diluted
399
307
322
306
Earnings (loss) per share:
Basic
$
(0.62
)
$
(1.56
)
$
(2.41
)
$
(9.34
)
Diluted
$
(0.72
)
$
(1.56
)
$
(2.43
)
$
(9.34
)
UNAUDITED CONSOLIDATED BALANCE SHEETS
(In millions, except par value and share data)
December 31,
2025
December 31,
2024
ASSETS
Cash and cash equivalents
$
565
$
592
Restricted cash and cash equivalents:
Vehicle
317
258
Non-vehicle
285
283
Total restricted cash and cash equivalents
602
541
Total cash and cash equivalents and restricted cash and cash equivalents
1,167
1,133
Receivables:
Vehicle
381
389
Non-vehicle, net of allowance of $91 and $58, respectively
729
816
Total receivables, net
1,110
1,205
Prepaid expenses and other assets
782
894
Revenue earning vehicles:
Vehicles
14,039
12,714
Less: accumulated depreciation
(1,513
)
(751
)
Total revenue earning vehicles, net
12,526
11,963
Property and equipment, net
566
623
Operating lease right-of-use assets
2,257
2,088
Intangible assets, net
2,858
2,852
Goodwill
1,045
1,044
Total assets
$
22,311
$
21,802
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable:
Vehicle
$
342
$
161
Non-vehicle
517
481
Total accounts payable
859
642
Accrued liabilities
1,231
1,174
Accrued taxes, net
131
158
Debt:
Vehicle
11,629
11,231
Non-vehicle
5,425
5,104
Total debt
17,054
16,335
Public Warrants
222
178
Operating lease liabilities
2,275
2,073
Self-insured liabilities
648
617
Deferred income taxes, net
350
472
Total liabilities
22,770
21,649
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, no shares issued and outstanding
—
—
Common stock, $0.01 par value, 486,543,836 and 481,502,623 shares issued, respectively, and 311,731,792 and 306,690,579 shares outstanding, respectively
5
5
Treasury stock, at cost, 174,812,044 and 174,812,044 common shares, respectively
(3,430
)
(3,430
)
Additional paid-in capital
6,447
6,396
Retained earnings (Accumulated deficit)
(3,249
)
(2,502
)
Accumulated other comprehensive income (loss)
(232
)
(316
)
Total stockholders' equity (deficit)
(459
)
153
Total liabilities and stockholders' equity (deficit)
$
22,311
$
21,802
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended
December 31,
Twelve Months Ended
December 31,
(In millions)
2025
2024
2025
2024
Cash flows from operating activities:
Net income (loss)
$
(194
)
$
(479
)
$
(747
)
$
(2,862
)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and reserves for revenue earning vehicles, net
563
764
2,148
3,983
Depreciation and amortization, non-vehicle
29
32
117
139
Amortization of deferred financing costs and debt discount (premium)
25
20
86
74
PIK Interest on Exchangeable Notes
—
—
21
—
Stock-based compensation charges
17
15
63
63
Stock-based compensation forfeitures
—
—
—
(68
)
Provision for receivables allowance
41
26
127
120
Deferred income taxes, net
(44
)
(80
)
(132
)
(459
)
Long-Lived Assets impairment
—
—
—
1,048
(Gain) loss on sale of non-vehicle capital assets
(16
)
—
(144
)
—
Change in fair value of Public Warrants
(86
)
(3
)
44
(275
)
Changes in financial instruments
(109
)
15
(37
)
7
Other
1
(25
)
6
(26
)
Changes in assets and liabilities:
Non-vehicle receivables
11
68
(11
)
23
Prepaid expenses and other assets
18
28
(12
)
8
Operating lease right-of-use assets
114
105
437
386
Non-vehicle accounts payable
(31
)
4
12
(14
)
Accrued liabilities
4
14
63
324
Accrued taxes, net
(38
)
(46
)
(35
)
18
Operating lease liabilities
(99
)
(109
)
(403
)
(417
)
Self-insured liabilities
(13
)
65
22
152
Net cash provided by (used in) operating activities
193
414
1,625
2,224
Cash flows from investing activities:
Revenue earning vehicles expenditures
(2,384
)
(2,666
)
(10,183
)
(10,524
)
Proceeds from disposal of revenue earning vehicles
2,116
3,022
8,086
7,678
Non-vehicle capital asset expenditures
(27
)
(24
)
(97
)
(105
)
Proceeds from non-vehicle capital assets disposed of
23
4
200
23
Return of (investment in) equity investments
(1
)
2
(1
)
(1
)
Net cash provided by (used in) investing activities
(273
)
338
(1,995
)
(2,929
)
Cash flows from financing activities:
Proceeds from issuance of vehicle debt
1,307
614
5,931
3,873
Repayments of vehicle debt
(1,476
)
(1,547
)
(5,761
)
(4,827
)
Proceeds from issuance of non-vehicle debt
670
1,176
2,501
4,646
Repayments of non-vehicle debt
(790
)
(732
)
(2,168
)
(2,966
)
Payment of financing costs
(14
)
(9
)
(82
)
(64
)
Purchase of Capped Call Transactions, net
—
—
(38
)
—
Other
(2
)
—
(11
)
(4
)
Net cash provided by (used in) financing activities
(305
)
(498
)
372
658
Effect of foreign currency exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents
3
(26
)
32
(26
)
Net increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents during the period
(382
)
228
34
(73
)
Cash and cash equivalents and restricted cash and cash equivalents at beginning of period
1,549
905
1,133
1,206
Cash and cash equivalents and restricted cash and cash equivalents at end of period
$
1,167
$
1,133
$
1,167
$
1,133
Supplemental Schedule I
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
Three Months Ended December 31, 2025
Three Months Ended December 31, 2024
(In millions)
Americas RAC
International
RAC
Corporate
Hertz Global
Americas RAC
International
RAC
Corporate
Hertz Global
Revenues
$
1,621
$
407
$
—
$
2,028
$
1,669
$
371
$
—
$
2,040
Expenses:
Direct vehicle and operating
1,108
263
(4
)
1,367
1,173
240
—
1,413
Depreciation of revenue earning vehicles and lease charges, net
432
88
—
520
595
75
—
670
Depreciation and amortization of non-vehicle assets
24
4
1
29
28
3
1
32
Selling, general and administrative
131
44
76
251
108
84
33
225
Interest expense, net:
Vehicle
130
25
—
155
116
27
—
143
Non-vehicle
1
(4
)
27
24
(1
)
(4
)
122
117
Total interest expense, net
131
21
27
179
115
23
122
260
Other (income) expense, net
(2
)
(3
)
—
(5
)
(2
)
—
4
2
(Gain) on sale of non-vehicle capital assets
(16
)
—
—
(16
)
—
—
—
—
Legal settlement
—
—
—
—
—
—
—
—
Bankruptcy-related litigation reserve
—
—
12
12
—
—
4
4
Long-Lived Assets impairment
—
—
—
—
—
—
—
—
Change in fair value of Public Warrants
—
—
(86
)
(86
)
—
—
(3
)
(3
)
Total expenses
1,808
417
26
2,251
2,017
425
161
2,603
Income (loss) before income taxes
$
(187
)
$
(10
)
$
(26
)
(223
)
$
(348
)
$
(54
)
$
(161
)
(563
)
Income tax (provision) benefit
29
84
Net income (loss)
$
(194
)
$
(479
)
Supplemental Schedule I (continued)
HERTZ GLOBAL HOLDINGS, INC.
CONDENSED STATEMENT OF OPERATIONS BY SEGMENT
Unaudited
Twelve Months Ended December 31, 2025
Twelve Months Ended December 31, 2024
(In millions)
Americas RAC
International
RAC
Corporate
Hertz Global
Americas RAC
International
RAC
Corporate
Hertz Global
Revenues
$
6,759
$
1,745
$
—
$
8,504
$
7,398
$
1,651
$
—
$
9,049
Expenses:
Direct vehicle and operating
4,461
1,031
(3
)
5,489
4,726
971
(8
)
5,689
Depreciation of revenue earning vehicles and lease charges, net
1,574
353
—
1,927
3,198
413
—
3,611
Depreciation and amortization of non-vehicle assets
96
14
7
117
109
13
17
139
Selling, general and administrative
504
228
225
957
482
244
93
819
Interest expense, net:
Vehicle
510
98
—
608
479
111
—
590
Non-vehicle
2
(16
)
483
469
(4
)
(18
)
391
369
Total interest expense, net
512
82
483
1,077
475
93
391
959
Other (income) expense, net
—
(8
)
5
(3
)
—
2
2
4
(Gain) on sale of non-vehicle capital assets
(144
)
—
—
(144
)
—
—
—
—
Legal settlement
(154
)
—
—
(154
)
—
—
—
—
Bankruptcy-related litigation reserve
—
—
24
24
—
—
292
292
Long-Lived Assets impairment
—
—
—
—
865
183
—
1,048
Change in fair value of Public Warrants
—
—
44
44
—
—
(275
)
(275
)
Total expenses
6,849
1,700
785
9,334
9,855
1,919
512
12,286
Income (loss) before income taxes
$
(90
)
$
45
$
(785
)
(830
)
$
(2,457
)
$
(268
)
$
(512
)
(3,237
)
Income tax (provision) benefit
83
375
Net income (loss)
$
(747
)
$
(2,862
)
Supplemental Schedule II
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - ADJUSTED NET INCOME (LOSS), ADJUSTED DILUTED EARNINGS (LOSS) PER SHARE AND ADJUSTED CORPORATE EBITDA
Unaudited
Three Months Ended
December 31,
Twelve Months Ended
December 31,
(In millions, except per share data)
2025
2024
2025
2024
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share:
Net income (loss) (a)
$
(194
)
$
(479
)
$
(747
)
$
(2,862
)
Adjustments:
Income tax provision (benefit)
(29
)
(84
)
(83
)
(375
)
Vehicle and non-vehicle debt-related charges (b)
32
26
109
86
Restructuring and restructuring related charges (c)
7
21
18
66
Acquisition accounting-related depreciation and amortization (d)
—
1
1
2
Unrealized (gains) losses on financial instruments (e)
(108
)
15
(37
)
7
(Gain) on sale of non-vehicle capital assets (f)
(16
)
—
(144
)
—
Legal settlement (g)
—
—
(154
)
—
Bankruptcy-related litigation reserve (h)
12
4
24
292
Long-Lived Assets impairment (i)
—
—
—
1,048
Change in fair value of Public Warrants
(86
)
(3
)
44
(275
)
Other items (j)(k)
46
16
91
62
Adjusted pre-tax income (loss) (l)
(336
)
(483
)
(878
)
(1,949
)
Income tax (provision) benefit on adjusted pre-tax income (loss) (m)
84
121
219
487
Adjusted Net Income (Loss)
$
(252
)
$
(362
)
$
(659
)
$
(1,462
)
Weighted-average number of diluted shares outstanding
399
307
322
306
Adjusted Diluted Earnings (Loss) Per Share (n)
$
(0.63
)
$
(1.18
)
$
(2.05
)
$
(4.77
)
Supplemental Schedule II (continued)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
(In millions, except per share data)
2025
2024
2025
2024
Adjusted Corporate EBITDA:
Net income (loss)
$
(194
)
$
(479
)
$
(747
)
$
(2,862
)
Adjustments:
Income tax provision (benefit)
(29
)
(84
)
(83
)
(375
)
Non-vehicle depreciation and amortization
29
32
117
139
Non-vehicle debt interest, net of interest income (o)
127
109
498
375
Vehicle debt-related charges (b)
11
12
46
45
Restructuring and restructuring related charges (c)
7
21
18
66
Unrealized (gains) losses on financial instruments (e)
(108
)
15
(37
)
7
(Gain) on sale of non-vehicle capital assets (f)
(16
)
—
(144
)
—
Legal settlement (g)
—
—
(154
)
—
Bankruptcy-related litigation reserve (h)
12
4
24
292
Long-Lived Assets impairment (i)
—
—
—
1,048
Non-cash stock-based compensation forfeitures (p)
—
—
—
(64
)
Change in fair value of Public Warrants
(86
)
(3
)
44
(275
)
Other items (j)
42
16
79
63
Adjusted Corporate EBITDA (q)
$
(205
)
$
(357
)
$
(339
)
$
(1,541
)
Adjusted Corporate EBITDA margin
(10
)%
(18
)%
(4
)%
(17
)%
Net income (loss) margin for the three and twelve months ended December 31, 2025 was (10)% and (9)%, respectively. Net income (loss) margin for the three and twelve months ended December 31, 2024 was (23)% and (32)%, respectively.
Represents debt-related charges relating to the amortization of deferred financing costs and debt discounts and premiums.
Represents charges incurred under restructuring actions as defined in U.S. GAAP. Also includes restructuring related charges such as incremental costs incurred related to personnel reductions, litigation and closure of underperforming locations.
Represents incremental expense associated with the amortization of other intangible assets and depreciation of property and equipment relating to acquisition accounting.
Represents unrealized gains (losses) on derivative financial instruments, including the Exchange Features 2029 and Exchange Feature 2030.
Represents gains on the sales of certain non-vehicle assets primarily in the second and third quarters of 2025.
Represents the gain related to the receipt of a settlement distribution in September 2025 in connection with the Company’s participation in a class action settlement.
Represents an increase to an existing bankruptcy-related litigation reserve initially recorded in September 2024, including interest which continues to accrue during each subsequent reporting period.
Represents Long-Lived Assets impairment charges recognized in the third quarter of 2024.
Represents miscellaneous items. For 2025, primarily includes a pension plan settlement reserve adjustment, a one-time settlement agreement to restructure an IT contract, certain IT-related charges, cloud computing costs, an unfavorable litigation ruling and certain concession-related adjustments. For 2024, primarily includes certain IT-related charges, cloud computing costs and certain storm-related damages, partially offset by certain litigation settlements and a loss recovery settlement.
Also includes letter of credit fees.
The table below reconciles expenses as reported in the condensed consolidated unaudited statement of operations to adjusted expenses utilized in calculating Adjusted Pretax Income (Loss) and Adjusted Net Income (Loss), all of which are deemed non-GAAP measures.
Three Months Ended December 31, 2025
Three Months Ended December 31, 2024
Expenses:
As Reported
Adjustment
As Adjusted
As Reported
Adjustment
As Adjusted
Direct vehicle and operating
$
1,367
$
(41
)
$
1,326
$
1,413
$
(6
)
$
1,407
Depreciation of revenue earning vehicles and lease charges, net
520
—
520
670
3
673
Depreciation and amortization of non-vehicle assets
29
—
29
32
—
32
Selling, general and administrative
251
(6
)
245
225
(35
)
190
Interest expense, net:
Vehicle
155
(11
)
144
143
(11
)
132
Non-vehicle
24
76
100
117
(26
)
91
Total interest expense, net
179
65
244
260
(37
)
223
Other (income) expense, net
(5
)
5
—
2
(5
)
(3
)
(Gain) on sale of non-vehicle capital assets
(16
)
16
—
—
—
—
Bankruptcy-related litigation reserve
12
(12
)
—
4
(4
)
—
Change in fair value of Public Warrants
(86
)
86
—
(3
)
3
—
Total expenses
$
2,251
$
113
$
2,364
$
2,603
$
(81
)
$
2,522
(in millions)
Twelve Months Ended December 31, 2025
Twelve Months Ended December 31, 2024
Expenses:
As Reported
Adjustment
As Adjusted
As Reported
Adjustment
As Adjusted
Direct vehicle and operating
$
5,489
$
(55
)
$
5,434
$
5,689
$
(31
)
$
5,658
Depreciation of revenue earning vehicles and lease charges, net
1,927
—
1,927
3,611
8
3,619
Depreciation and amortization of non-vehicle assets
117
—
117
139
—
139
Selling, general and administrative
957
(30
)
927
819
(96
)
723
Interest expense, net:
Vehicle
608
(46
)
562
590
(50
)
540
Non-vehicle
469
(56
)
413
369
(51
)
318
Total interest expense, net
1,077
(102
)
975
959
(101
)
858
Other (income) expense, net
(3
)
5
2
4
(2
)
2
(Gain) on sale of non-vehicle capital assets
(144
)
144
—
—
—
—
Legal settlement
(154
)
154
—
—
—
—
Bankruptcy-related litigation reserve
24
(24
)
—
292
(292
)
—
Long-Lived Assets impairment
—
—
—
1,048
(1,048
)
—
Change in fair value of Public Warrants
44
(44
)
—
(275
)
275
—
Total expenses
$
9,334
$
48
$
9,382
$
12,286
$
(1,287
)
$
10,999
(m)
Derived utilizing an effective rate of 25% for the three and twelve months ended December 31, 2025 and 2024, respectively, applied to the respective Adjusted Pre-tax Income (Loss).
(n)
Adjustments used to reconcile diluted earnings (loss) per share on a GAAP basis to Adjusted Diluted Earnings (Loss) Per Share are comprised of the same adjustments, inclusive of the tax impact, used to reconcile net income (loss) to Adjusted Net Income (Loss) divided by the weighted-average diluted shares outstanding during the period.
(o)
Excludes gains (losses) related to the fair value of the Exchange Features 2029 and Exchange Feature 2030.
(p)
Represents former CEO awards forfeited in March 2024.
(q)
The table below reconciles expenses as reported in the condensed consolidated unaudited statement of operations to adjusted expenses utilized in calculating Adjusted Corporate EBITDA, both of which are deemed non-GAAP measures.
(in millions)
Three Months Ended December 31, 2025
Three Months Ended December 31, 2024
Expenses:
As Reported
Adjustment
As Adjusted
As Reported
Adjustment
As Adjusted
Direct vehicle and operating
$
1,367
$
(41
)
$
1,326
$
1,413
$
(6
)
$
1,407
Depreciation of revenue earning vehicles and lease charges, net
520
—
520
670
3
673
Depreciation and amortization of non-vehicle assets
29
(29
)
—
32
(32
)
—
Selling, general and administrative
251
(8
)
243
225
(35
)
190
Interest expense, net:
Vehicle
155
(11
)
144
143
(11
)
132
Non-vehicle
24
(24
)
—
117
(117
)
—
Total interest expense, net
179
(35
)
144
260
(128
)
132
Other (income) expense, net
(5
)
5
—
2
(8
)
(6
)
(Gain) on sale of non-vehicle capital assets
(16
)
16
—
—
—
—
Bankruptcy-related litigation reserve
12
(12
)
—
4
(4
)
—
Change in fair value of Public Warrants
(86
)
86
—
(3
)
3
—
Total expenses
$
2,251
$
(18
)
$
2,233
$
2,603
$
(207
)
$
2,396
(in millions)
Twelve Months Ended December 31, 2025
Twelve Months Ended December 31, 2024
Expenses:
As Reported
Adjustment
As Adjusted
As Reported
Adjustment
As Adjusted
Direct vehicle and operating
$
5,489
$
(59
)
$
5,430
$
5,689
$
(31
)
$
5,658
Depreciation of revenue earning vehicles and lease charges, net
1,927
—
1,927
3,611
8
3,619
Depreciation and amortization of non-vehicle assets
117
(117
)
—
139
(139
)
—
Selling, general and administrative
957
(35
)
922
819
(33
)
786
Interest expense, net:
Vehicle
608
(46
)
562
590
(50
)
540
Non-vehicle
469
(469
)
—
369
(369
)
—
Total interest expense, net
1,077
(515
)
562
959
(419
)
540
Other (income) expense, net
(3
)
5
2
4
(17
)
(13
)
(Gain) on sale of non-vehicle capital assets
(144
)
144
—
—
—
—
Litigation settlement
(154
)
154
—
—
—
—
Bankruptcy-related litigation reserve
24
(24
)
—
292
(292
)
—
Long-Lived Assets impairment
—
—
—
1,048
(1,048
)
—
Change in fair value of Public Warrants
44
(44
)
—
(275
)
275
—
Total expenses
$
9,334
$
(491
)
$
8,843
$
12,286
$
(1,696
)
$
10,590
Supplemental Schedule III
HERTZ GLOBAL HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURE - ADJUSTED OPERATING CASH FLOW
AND ADJUSTED FREE CASH FLOW
Unaudited
Three Months Ended
December 31,
Twelve Months Ended
December 31,
(In millions)
2025
2024
2025
2024
ADJUSTED OPERATING CASH FLOW AND ADJUSTED FREE CASH FLOW:
Net cash provided by (used in) operating activities
$
193
$
414
$
1,625
$
2,224
Depreciation and reserves for revenue earning vehicles, net
(563
)
(764
)
(2,148
)
(3,983
)
Bankruptcy related payments (post emergence) and other payments
(1
)
—
(143
)
4
Adjusted operating cash flow
(371
)
(350
)
(666
)
(1,755
)
Non-vehicle capital asset proceeds (expenditures), net
(4
)
(21
)
103
(83
)
Adjusted operating cash flow before vehicle investment
(375
)
(371
)
(563
)
(1,838
)
Net fleet growth after financing
(20
)
39
165
70
Adjusted free cash flow
$
(395
)
$
(332
)
$
(398
)
$
(1,768
)
CALCULATION OF NET FLEET GROWTH AFTER FINANCING:
Revenue earning vehicles expenditures
$
(2,384
)
$
(2,666
)
$
(10,183
)
$
(10,524
)
Proceeds from disposal of revenue earning vehicles
2,116
3,022
8,086
7,678
Revenue earning vehicles capital expenditures, net
(268
)
356
(2,097
)
(2,846
)
Depreciation and reserves for revenue earning vehicles, net
563
764
2,148
3,983
Financing activity related to vehicles:
Borrowings
1,307
614
5,931
3,873
Payments
(1,476
)
(1,547
)
(5,761
)
(4,827
)
Restricted cash changes, vehicle
(146
)
(148
)
(56
)
(113
)
Net financing activity related to vehicles
(315
)
(1,081
)
114
(1,067
)
Net fleet growth after financing
$
(20
)
$
39
$
165
$
70
Supplemental Schedule IV
HERTZ GLOBAL HOLDINGS, INC.
NET DEBT CALCULATION
Unaudited
As of December 31, 2025
As of December 31, 2024
(In millions)
Vehicle
Non-Vehicle
Total
Vehicle
Non-Vehicle
Total
First Lien RCF
$
—
$
395
$
395
$
—
$
175
$
175
Term loans
—
1,977
1,977
—
1,995
1,995
First lien senior notes
—
1,250
1,250
—
1,250
1,250
Second lien exchangeable notes
—
271
271
—
250
250
Unsecured exchangeable notes
—
425
425
—
—
—
Unsecured senior notes
—
1,200
1,200
—
1,500
1,500
U.S. vehicle financing (HVF III)
9,886
—
9,886
9,431
—
9,431
International vehicle financing (Various)
1,673
—
1,673
1,752
—
1,752
Other debt
120
6
126
97
—
97
Fair value of the Exchange Features 2029
—
78
78
—
61
61
Fair value of the Exchange Feature 2030
—
54
54
—
—
—
Debt issue costs, discounts and premiums
(50
)
(231
)
(281
)
(49
)
(127
)
(176
)
Debt as reported in the balance sheet
11,629
5,425
17,054
11,231
5,104
16,335
Add:
Debt issue costs, discounts and premiums
50
231
281
49
127
176
Less:
Cash and cash equivalents
—
565
565
—
592
592
Restricted cash
317
—
317
258
—
258
Restricted cash and restricted cash equivalents associated with Term C Loan
—
245
245
—
245
245
Net Debt
$
11,362
$
4,846
$
16,208
$
11,022
$
4,394
$
15,416
LTM Adjusted Corporate EBITDA
(339
)
(1,541
)
Net Corporate Leverage
NM
(2.9)x
NM = Not meaningful
Supplemental Schedule V
HERTZ GLOBAL HOLDINGS, INC.
KEY METRICS CALCULATIONS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
Global RAC
Three Months Ended
December 31,
Percent
Inc/(Dec)
Twelve Months Ended
December 31,
Percent
Inc/(Dec)
($ in millions, except where noted)
2025
2024
2025
2024
Total RPD
Revenues
$
2,028
$
2,040
$
8,504
$
9,049
Foreign currency adjustment (a)
(35
)
(14
)
(125
)
(81
)
Total Revenues - adjusted for foreign currency
$
1,993
$
2,026
$
8,379
$
8,968
Transaction Days (in thousands)
35,804
35,998
149,286
153,871
Total RPD (in dollars)
$
55.67
$
56.27
(1
)%
$
56.13
$
58.28
(4
)%
Total Revenue Per Unit Per Month
Total Revenues - adjusted for foreign currency
$
1,993
$
2,026
$
8,379
$
8,968
Average Rentable Vehicles (in whole units)
498,120
497,875
504,060
530,679
Total revenue per unit (in whole dollars)
$
4,002
$
4,069
$
16,624
$
16,898
Number of months in period (in whole units)
3
3
12
12
Total RPU Per Month (in whole dollars)
$
1,334
$
1,356
(2
)%
$
1,385
$
1,408
(2
)%
Vehicle Utilization
Transaction Days (in thousands)
35,804
35,998
149,286
153,871
Average Rentable Vehicles (in whole units)
498,120
497,875
504,060
530,679
Number of days in period (in whole units)
92
92
365
366
Available Car Days (in thousands)
45,832
45,805
184,042
194,257
Vehicle Utilization (b)
78
%
79
%
81
%
79
%
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease charges, net
$
520
$
670
$
1,927
$
3,611
Foreign currency adjustment (a)
(8
)
(2
)
(26
)
(18
)
Adjusted depreciation of revenue earning vehicles and lease charges
$
512
$
668
$
1,901
$
3,593
Average Vehicles (in whole units)
516,867
532,884
527,379
560,279
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars)
$
990
$
1,253
$
3,604
$
6,414
Number of months in period (in whole units)
3
3
12
12
Depreciation Per Unit Per Month (in whole dollars)
$
330
$
418
(21
)%
$
300
$
534
(44
)%
Adjusted DOE per Transaction Day
Direct Operating Expense – as reported
$
1,367
$
1,413
$
5,489
$
5,689
Adjustments:
Foreign Currency Adjustment (a)
(23
)
(10
)
(74
)
(49
)
Other (c)
(41
)
(6
)
(59
)
(31
)
Direct Operating Expense (DOE) – as adjusted
1,303
1,397
5,356
5,609
Transaction Days (In Thousands)
35,804
35,998
149,286
153,871
Adjusted DOE per Transaction Day
$
36.39
$
38.81
(6
)%
$
35.88
$
36.45
(2
)%
Note: Global RAC represents Americas RAC and International RAC segment information on a combined basis and excludes Corporate
Based on December 31, 2024 foreign exchange rates.
Calculated as Transaction Days divided by Available Car Days.
For Q4 2025, primarily reflects a pension plan settlement reserve adjustment and a one-time settlement agreement to restructure an IT contract. For Q4 2024, primarily reflects certain restructuring related IT costs. For FY 2025, primarily reflects a pension plan settlement reserve adjustment, a one-time settlement agreement to restructure an IT contract and certain restructuring related IT costs. For FY 2024, primarily reflects certain restructuring related IT costs and certain storm-related vehicle damages.
Supplemental Schedule V (continued)
HERTZ GLOBAL HOLDINGS, INC.
KEY METRICS CALCULATIONS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
Americas RAC
Three Months Ended
December 31,
Percent
Inc/(Dec)
Twelve Months Ended
December 31,
Percent
Inc/(Dec)
($ in millions, except where noted)
2025
2024
2025
2024
Total RPD
Revenues
$
1,621
$
1,669
$
6,759
$
7,398
Foreign currency adjustment (a)
(2
)
(2
)
(10
)
(16
)
Total Revenues - adjusted for foreign currency
$
1,619
$
1,667
$
6,749
$
7,382
Transaction Days (in thousands)
28,857
29,298
119,473
124,767
Total RPD (in dollars)
$
56.11
$
56.89
(1
)%
$
56.49
$
59.17
(5
)%
Total Revenue Per Unit Per Month
Total Revenues - adjusted for foreign currency
$
1,619
$
1,667
$
6,749
$
7,382
Average Rentable Vehicles (in whole units)
398,106
399,927
400,355
426,017
Total revenue per unit (in whole dollars)
$
4,067
$
4,168
$
16,856
$
17,328
Number of months in period (in whole units)
3
3
12
12
Total RPU Per Month (in whole dollars)
$
1,356
$
1,389
(2
)%
$
1,405
$
1,444
(3
)%
Vehicle Utilization
Transaction Days (in thousands)
28,857
29,298
119,473
124,767
Average Rentable Vehicles (in whole units)
398,106
399,927
400,355
426,017
Number of days in period (in whole units)
92
92
365
366
Available Car Days (in thousands)
36,629
36,792
146,157
155,935
Vehicle Utilization (b)
79
%
80
%
82
%
80
%
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease charges, net
$
432
$
595
$
1,574
$
3,198
Foreign currency adjustment (a)
—
—
(1
)
(2
)
Adjusted depreciation of revenue earning vehicles and lease charges
$
432
$
595
$
1,573
$
3,196
Average Vehicles (in whole units)
415,264
432,909
422,346
453,706
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars)
$
1,039
$
1,375
$
3,724
$
7,044
Number of months in period (in whole units)
3
3
12
12
Depreciation Per Unit Per Month (in whole dollars)
$
346
$
458
(24
)%
$
310
$
587
(47
)%
Adjusted DOE per Transaction Day
Direct Operating Expense – as reported
$
1,108
$
1,173
$
4,461
$
4,726
Adjustments:
Foreign Currency Adjustment (a)
(2
)
(1
)
(6
)
(9
)
Other (c)
(40
)
(8
)
(57
)
(37
)
Direct Operating Expense (DOE) – as adjusted
1,066
1,164
4,398
4,680
Transaction Days (In Thousands)
28,857
29,298
119,473
124,767
Adjusted DOE per Transaction Day
$
36.94
$
39.73
(7
)%
$
36.81
$
37.51
(2
)%
(a)
Based on December 31, 2024 foreign exchange rates.
(b)
Calculated as Transaction Days divided by Available Car Days.
(c)
For Q4 2025, primarily reflects a pension plan settlement reserve adjustment and a one-time settlement agreement to restructure an IT contract. For Q4 2024, primarily reflects certain restructuring related IT costs. For FY 2025, primarily reflects a pension plan settlement reserve adjustment, a one-time settlement agreement to restructure an IT contract and certain restructuring related IT costs. For FY 2024, primarily reflects certain restructuring related IT costs and certain storm-related vehicle damages
Supplemental Schedule V (continued)
HERTZ GLOBAL HOLDINGS, INC.
KEY METRICS CALCULATIONS
REVENUE, UTILIZATION AND DEPRECIATION
Unaudited
International RAC
Three Months Ended
December 31,
Percent
Inc/(Dec)
Twelve Months Ended
December 31,
Percent
Inc/(Dec)
($ in millions, except where noted)
2025
2024
2025
2024
Total RPD
Revenues
$
407
$
371
$
1,745
$
1,651
Foreign currency adjustment (a)
(33
)
(12
)
(114
)
(65
)
Total Revenues - adjusted for foreign currency
$
374
$
359
$
1,631
$
1,586
Transaction Days (in thousands)
6,948
6,700
29,813
29,104
Total RPD (in dollars)
$
53.89
$
53.57
1
%
$
54.70
$
54.48
—
%
Total Revenue Per Unit Per Month
Total Revenues - adjusted for foreign currency
$
374
$
359
$
1,631
$
1,586
Average Rentable Vehicles (in whole units)
100,013
97,948
103,704
104,661
Total revenue per unit (in whole dollars)
$
3,744
$
3,664
$
15,726
$
15,150
Number of months in period (in whole units)
3
3
12
12
Total RPU Per Month (in whole dollars)
$
1,248
$
1,221
2
%
$
1,311
$
1,262
4
%
Vehicle Utilization
Transaction Days (in thousands)
6,948
6,700
29,813
29,104
Average Rentable Vehicles (in whole units)
100,013
97,948
103,704
104,661
Number of days in period (in whole units)
92
92
365
366
Available Car Days (in thousands)
9,203
9,013
37,885
38,321
Vehicle Utilization (b)
75
%
74
%
79
%
76
%
Depreciation Per Unit Per Month
Depreciation of revenue earning vehicles and lease charges, net
$
88
$
75
$
353
$
413
Foreign currency adjustment (a)
(8
)
(3
)
(25
)
(16
)
Adjusted depreciation of revenue earning vehicles and lease charges
$
80
$
72
$
328
$
397
Average Vehicles (in whole units)
101,603
99,975
105,033
106,573
Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars)
$
789
$
723
$
3,123
$
3,729
Number of months in period (in whole units)
3
3
12
12
Depreciation Per Unit Per Month (in whole dollars)
$
263
$
241
9
%
$
260
$
311
(16
)%
Adjusted DOE per Transaction Day
Direct Operating Expense – as reported
$
263
$
240
$
1,031
$
971
Adjustments:
Foreign Currency Adjustment (a)
(22
)
(7
)
(68
)
(39
)
Other
(1
)
—
(2
)
(2
)
Direct Operating Expense (DOE) – as adjusted
240
233
961
930
Transaction Days (In Thousands)
6,948
6,700
29,813
29,104
Adjusted DOE per Transaction Day
$
34.54
$
34.78
(1
)%
$
32.23
$
31.95
1
%
Based on December 31, 2024 foreign exchange rates.
Calculated as Transaction Days divided by Available Car Days.
NON-GAAP MEASURES AND KEY METRICS
The term “GAAP” refers to accounting principles generally accepted in the United States. Adjusted EBITDA is the Company's segment measure of profitability and complies with GAAP when used in that context.
NON-GAAP MEASURES
Non-GAAP measures are not recognized measurements under GAAP. When evaluating the Company's operating performance or liquidity, investors should not consider non-GAAP measures in isolation of, superior to, or as a substitute for measures of the Company's financial performance as determined in accordance with GAAP.
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share ("Adjusted EPS")
Adjusted Net Income (Loss) represents income or loss attributable to the Company as adjusted to eliminate the impact of GAAP income tax; vehicle and non-vehicle debt-related charges; restructuring and restructuring related charges; acquisition accounting-related depreciation and amortization; unrealized (gains) losses on financial instruments; change in fair value of Public Warrants and certain other miscellaneous or non-recurring items on a pre-tax basis. Adjusted Net Income (Loss) includes a provision (benefit) for income taxes derived utilizing a combined statutory rate. The combined statutory rate is management's estimate of the Company's long-term tax rate. Its most comparable GAAP measure is net income (loss).
Adjusted EPS represents Adjusted Net Income (Loss) on a per diluted share basis using the weighted-average number of diluted shares outstanding for the period. Its most comparable GAAP measure is diluted earnings (loss) per share.
Adjusted Net Income (Loss) and Adjusted EPS are important operating metrics because they allow management and investors to assess operational performance of the Company's business, exclusive of the items mentioned above that are not operational in nature or comparable to those of the Company's competitors.
Adjusted Corporate EBITDA and Adjusted Corporate EBITDA Margin
Adjusted Corporate EBITDA represents income or loss attributable to the Company as adjusted to eliminate the impact of GAAP income tax; non-vehicle depreciation and amortization; non-vehicle debt interest, net; vehicle debt-related charges; restructuring and restructuring related charges; unrealized (gains) losses on financial instruments; change in fair value of Public Warrants and certain other miscellaneous or non-recurring items.
Adjusted Corporate EBITDA Margin is calculated as the ratio of Adjusted Corporate EBITDA to total revenues.
Management uses these measures as operating performance metrics for internal monitoring and planning purposes, including the preparation of the Company's annual operating budget and monthly operating reviews, and analysis of investment decisions, profitability and performance trends. These measures enable management and investors to isolate the effects on profitability of operating metrics most meaningful to the business of renting and leasing vehicles. They also allow management and investors to assess the performance of the entire business on the same basis as its reportable segments. Adjusted Corporate EBITDA is also utilized in the determination of certain executive compensation. Its most comparable GAAP measure is net income (loss) attributable to the Company.
Adjusted operating cash flow and adjusted free cash flow
Adjusted operating cash flow represents net cash provided by operating activities net of the non-cash add back for vehicle depreciation and reserves, and exclusive of bankruptcy related payments made post emergence. Adjusted operating cash flow is an important performance measure to management and investors as it provides useful information about the amount of cash generated from operations when fully burdened by fleet costs.
Adjusted free cash flow represents adjusted operating cash flow plus the impact of net non-vehicle capital expenditures and net fleet growth after financing. Adjusted free cash flow is an important performance measure to management and investors as it provides useful information about the amount of cash available for, but not limited to, the reduction of non-vehicle debt, share repurchase and acquisition.
The most comparable GAAP measure for adjusted operating cash flow and adjusted free cash flow is net cash provided by (used in) operating activities.
Net Fleet Growth After Financing
U.S. and International Rental Car segments Fleet Growth is defined as revenue earning vehicles expenditures, net of proceeds from disposals, plus vehicle depreciation and net vehicle financing, which includes borrowings, repayments and the change in restricted cash associated with vehicles. Fleet Growth is important as it allows the Company to assess the cash flow required to support its investment in revenue earning vehicles.
Net Non-vehicle Debt
Net Non-vehicle Debt is calculated as non-vehicle debt as reported on the Company's balance sheet, excluding the impact of unamortized debt issuance costs associated with non-vehicle debt, less cash and cash equivalents. Non-vehicle debt consists of the Company's Senior Term Loans, Senior RCF, First Lien Senior Notes, Second Lien Exchangeable Notes, Senior Unsecured Notes, Promissory Notes and certain other non-vehicle indebtedness of its domestic and foreign subsidiaries. Net Non-vehicle Debt is important to management and investors as it helps measure the Company's corporate leverage. Net Non-vehicle Debt also assists in the evaluation of the Company's ability to service its non-vehicle debt without reference to the expense associated with the vehicle debt, which is collateralized by assets not available to lenders under the non-vehicle debt facilities.
Net Vehicle Debt
Net Vehicle Debt is calculated as vehicle debt as reported on the Company's balance sheet, excluding the impact of unamortized debt issue costs associated with vehicle debt, less restricted cash associated with vehicles. Restricted cash associated with vehicle debt is restricted for the purchase of revenue earning vehicles and other specified uses under the Company's vehicle debt facilities. Net Vehicle Debt is important to management, investors and ratings agencies as it helps measure the Company's leverage with respect to its vehicle assets.
Total Net Debt
Total Net Debt is calculated as total debt, excluding the impact of unamortized debt issuance costs, less total cash and cash equivalents and restricted cash associated with vehicle debt. Unamortized debt issuance costs are required to be reported as a deduction from the carrying amount of the related debt obligation under GAAP. Management believes that eliminating the effects that these costs have on debt will more accurately reflect the Company's net debt position. Total Net Debt is important to management, investors and ratings agencies as it helps measure the Company's gross leverage.
Net Corporate Leverage
Net Corporate Leverage is calculated as non-vehicle net debt divided by Adjusted Corporate EBITDA for the last twelve months. Net Corporate Leverage is important to management and investors as it measures the Company's corporate leverage net of unrestricted cash. Net Corporate Leverage also assists in the evaluation of the Company's ability to service its non-vehicle debt with reference to the generation of Adjusted Corporate EBITDA.
KEY METRICS
Adjusted Direct Operating Expense per Transaction Day (“adjusted DOE per day”)
Adjusted DOE per day is calculated as Direct Operating Expenses - as reported, exclusive of the impacts of foreign currency exchange rates and adjustments for certain other miscellaneous or non-recurring items, divided by the number of Transaction Days during the period. Adjusted DOE per day is important to management and investors as it measures the Company’s cost efficiency on a per unit basis excluding the impact of variable direct operating expense fluctuations attributable to changes in volume, so as not to affect the comparability of underlying trends.
Available Car Days
Available Car Days represents Average Rentable Vehicles multiplied by the number of days in a given period.
Average Vehicles ("Fleet Capacity" or "Capacity")
Average Vehicles is determined using a simple average of the number of vehicles in the fleet whether owned or leased by the Company at the beginning and end of a given period.
Average Rentable Vehicles
Average Rentable Vehicles reflects Average Vehicles excluding vehicles for sale on the Company’s retail lots or actively in the process of being sold through other disposition channels.
Depreciation Per Unit Per Month ("Depreciation Per Unit" or "DPU")
Depreciation Per Unit Per Month represents the amount of average depreciation expense and lease charges per vehicle per month, exclusive of the impacts of foreign currency exchange rates so as not to affect the comparability of underlying trends. This metric is important to management and investors as it reflects how effectively the Company is managing the costs of its vehicles and facilitates comparisons with other participants in the vehicle rental industry.
Total Revenue Per Transaction Day ("Total RPD" or "RPD"; also referred to as "pricing")
Total RPD represents revenue generated per transaction day, excluding the impact of foreign currency exchange rates so as not to affect the comparability of underlying trends. This metric is important to management and investors as it represents a measure of changes in the underlying pricing in the vehicle rental business and encompasses the elements in vehicle rental pricing that management has the ability to control.
Total Revenue Per Unit Per Month ("Total RPU", "RPU" or "Total RPU Per Month")
Total RPU Per Month represents the amount of revenue generated per vehicle in the rental fleet each month, excluding the impact of foreign currency exchange rates so as not to affect the comparability of underlying trends. This metric is important to management and investors as it provides a measure of revenue productivity relative to the number of vehicles in our rental fleet whether owned or leased, or asset efficiency.
Transaction Days ("Days"; also referred to as "volume")
Transaction Days represents the total number of 24-hour periods, with any partial period counted as one Transaction Day, that vehicles were on rent (the period between when a rental contract is opened and closed) in a given period. Thus, it is possible for a vehicle to attain more than one Transaction Day in a 24-hour period. This metric is important to management and investors as it represents the number of revenue-generating days.
Vehicle Utilization ("Utilization")
Vehicle Utilization represents the ratio of Transaction Days to Available Car Days. This metric is important to management and investors as it is the measurement of the proportion of vehicles that are being used to generate revenues relative to rentable fleet capacity.