Herc Holdings Inc
Q2 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +2.15%.
Did HRI Beat Earnings? Q2 2025 Results
Herc Holdings posted a headline beat in Q2 2025, with adjusted EPS of $1.87 topping the $1.76 consensus by 6.18% and revenue of $1.00 billion edging past estimates by 2.06% on 18.2% year-over-year growth, yet the quarter's defining story was the complexity introduced by the $5.3 billion acquisition of H&E Equipment Services, which closed June 2. The transformative deal drove a GAAP net loss of $35.00 million, compared to net income of $70.00 million a year ago, weighed down by $73.00 million in transaction expenses and a $49.00 million markdown on Cinelease assets. Adjusted EBITDA climbed 13% to $406.00 million, though margin compressed 200 basis points to 40.5% as H&E legacy branch revenue fell 14.1% due to pre-close disruption. Looking ahead, management guided full-year equipment rental revenue to $3.70 billion to $3.90 billion and adjusted EBITDA to $1.80 billion to $1.90 billion, reflecting near-term integration drag offset by mega project strength and specialty solutions growth.
- H&E Equipment Services acquisition closed June 2, 2025, adding 162 branches
- 14% growth in equipment rental revenue driven by second-half 2024 acquisitions and H&E June results
- National account revenue benefiting from mega project activity
- Herc legacy branches (excluding Cinelease) grew 4% YoY driven by government, infrastructure, and MRO
- H&E legacy branches declined 14.1% YoY due to pre-close dis-synergies
- Continued moderation in interest-rate-sensitive commercial sector
- Cinelease studio entertainment business continued decline due to industry softness
- SG&A improved as percent of rental revenue from initial H&E corporate overhead cost synergies
“The second quarter marked an important milestone for our company. On June 2nd, we completed the transaction to bring Herc Rentals and H&E Equipment Services together. This acquisition, the largest in the industry, will accelerate our strategy to deliver market leading growth and superior value creation by providing geographic and customer diversification, a substantially expanded footprint in key regions with economies of scale, and a larger fleet to strengthen our position as a premier rental company in North America.”
Herc Holdings CEO, on the earnings call
Forward Guidance & Outlook
The company updated its 2025 full-year guidance excluding Cinelease: equipment rental revenue of $3.7 billion to $3.9 billion, adjusted EBITDA of $1.8 billion to $1.9 billion, net rental equipment capital expenditures of $400 million to $600 million, and gross capex of $900 million to $1.1 billion. Adjusted free cash flow is guided at $400 million to $500 million, which includes benefits from the One Big Beautiful Bill Act. Key assumptions include accelerated dis-synergies from the H&E acquisition creating a lower revenue base, incremental gross capex for specialty equipment to support cross-sell synergies, and OEC dispositions of $1.1 billion to $1.2 billion to optimize fleet. The company expects continued strength from mega project activity and specialty solutions growth to partially offset moderation in interest-rate-sensitive commercial sectors.
HRI YoY Financials
HRI Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.