Herc Holdings Inc.

Equipment rental revenue was up approximately 23% year over year and total revenue grew 20%, largely because H&E was only in the prior-year base for one month. Adjusted EBITDA increased 19% to a 40.4% margin, and REBITDA increased approximately 18% to a 41.4% margin. Adjusted net income was $48 million, or $1.43 per diluted share. On a pro forma basis, equipment rental revenue rose despite lower average fleet at OEC, and pro forma dollar utilization increased more than 200 basis points. Free cash flow was $202 million for the first half, liquidity was $2.1 billion, and net leverage was 3.95x. For full-year 2026, management raised guidance to $4.425 billion of equipment rental revenue and about $2.09 billion of adjusted EBITDA at the midpoint, supported by roughly $900 million of net fleet CapEx. The company kept its revenue synergy target at $100 million to $120 million and expects an incremental $90 million of cost synergies this year toward the $125 million target by year-end. Free cash flow is now expected to be between $250 million and $350 million, and management said fuel and transportation inflation should create about 1 point of full-year adjusted EBITDA margin pressure.

Larry Silber framed the quarter as the first meaningful post-acquisition turning point, saying integration is complete and the focus has shifted fully to execution. He emphasized that pro forma rental revenue growth, improving fleet efficiency, and rising customer demand give the company confidence to raise guidance. His tone was constructive and confident, with repeated references to momentum heading into the second half and into 2027.

Mark Humphrey highlighted the hard numbers: equipment rental revenue up approximately 23%, total revenue up 20%, adjusted EBITDA up 19% with a 40.4% margin, and adjusted net income of $48 million or $1.43 per share. He said fuel and transportation inflation was the biggest margin headwind, up approximately 35% from the first quarter, and estimated about 150 basis points of adjusted EBITDA margin impact in Q2 and about 1 point of full-year margin drag. He also pointed to $202 million of first-half free cash flow, $2.1 billion of liquidity, and net leverage of 3.95x, while explaining that higher fleet investment is being directed toward higher-margin specialty equipment and should support EBITDA growth and deleveraging over time.

Analysts focused on pricing, margin recovery, CapEx, synergy timing, fuel inflation, and the sustainability of the stronger demand. Management said pricing remains rational and constructive, but the biggest near-term lift in dollar utilization came from fleet health and mix improvements, with more improvement expected in Q3 and Q4. On CapEx, they said the increase is demand-driven, not speculative, and on synergies they said revenue synergies are back-half weighted while about 55% of incremental cost synergies should land in the second half. They also said the higher fuel headwind is partly unrecoverable and that current assumptions already build in similar Q3 and Q4 pressure.