UNITED RENTALS NORTH AMERICA INC

Previous wording

Our operations are impacted by global economic conditions, including inflation, tariffs, interest rate fluctuations and supply chain constraints, and we take actions to modify our plans to address such economic conditions. Our operations can also be impacted by geopolitical risks, including risks related to international conflicts. To date, the impact from supply chain disruptions has been limited, but we may experience more severe supply chain disruptions in the future. Although interest rates have stabilized more recently, interest rates on our debt instruments have increased in recent years (the weighted average interest rates on our variable debt instruments were 1.4 percent in 2021, 6.3 percent in 2024, 5.4 percent in 2025 and 4.8 percent for the three months ended March 31, 2026). Interest rates on our indebtedness that bears interest at fixed rates have similarly fluctuated in recent years (for example, in December 2025, United Rentals (North America), Inc. (“URNA”) issued $1.5 billion principal amount of senior unsecured notes at a 53/8 percent interest rate, while URNA's issuance in August 2021 of $750 principal amount of senior unsecured notes was at a 33/4 percent interest rate). We have experienced and are continuing to experience inflationary pressures. A portion of inflationary cost increases is passed on to customers. The most significant cost increases that are passed on to customers are for fuel and delivery, and there are other costs for which the pass through to customers is less direct, such as repairs and maintenance, and labor. Tariffs could result in the costs we incur being more than anticipated. The impact of inflation, tariffs, interest rate fluctuations and international conflicts may be significant in the future.

Current wording

Our operations are impacted by global economic conditions, including inflation, tariffs, interest rate fluctuations and supply chain constraints, and we take actions to modify our plans to address such economic conditions. Our operations can also be impacted by geopolitical risks, including risks related to international conflicts. To date, the impact from supply chain disruptions has been limited, but we may experience more severe supply chain disruptions in the future. Although interest rates have stabilized more recently, interest rates on our debt instruments have increased in recent years (the weighted average interest rates on our variable debt instruments were 1.4 percent in 2021, 6.3 percent in 2024, 5.4 percent in 2025 and 4.8 percent for the six months ended June 30, 2026). Interest rates on our indebtedness that bears interest at fixed rates have similarly fluctuated in recent years (for example, in December 2025, United Rentals (North America), Inc. (“URNA”) issued $1.5 billion principal amount of senior unsecured notes at a 53/8 percent interest rate, while URNA's issuance in August 2021 of $750 principal amount of senior unsecured notes was at a 33/4 percent interest rate). We have experienced and are continuing to experience inflationary pressures. A portion of inflationary cost increases is passed on to customers. The most significant cost increases that are passed on to customers are for fuel and delivery, and there are other costs for which the pass through to customers is less direct, such as repairs and maintenance, and labor. Tariffs could result in the costs we incur being more than anticipated. The impact of inflation, tariffs, interest rate fluctuations and international conflicts may be significant in the future.

Previous wording

We are the largest equipment rental company in the world, with an integrated network of 1,767 rental locations. We primarily operate in the United States and Canada, and have a smaller presence in Europe, Australia and New Zealand. Although the equipment rental industry is highly fragmented and diverse, we believe that we are well positioned to take advantage of this environment because, as a larger company, we have more extensive resources and certain competitive advantages. These include a fleet of rental equipment with a total original equipment cost (“OEC”) of $22.6 billion, and a North American branch network that operates in 49 U.S. states and every Canadian province, and serves 99 of the 100 largest metropolitan areas in the U.S. Our size also gives us greater purchasing power, the ability to provide customers with a broader range of equipment and services, the ability to provide customers with equipment that is more consistently well-maintained and therefore more productive and reliable, and the ability to enhance the earning potential of our assets by transferring equipment among branches to satisfy customer needs.

Current wording

We are the largest equipment rental company in the world, with an integrated network of 1,774 rental locations. We primarily operate in the United States and Canada, and have a smaller presence in Europe, Australia and New Zealand. Although the equipment rental industry is highly fragmented and diverse, we believe that we are well positioned to take advantage of this environment because, as a larger company, we have more extensive resources and certain competitive advantages. These include a fleet of rental equipment with a total original equipment cost (“OEC”) of $23.8 billion, and a North American branch network that operates in 49 U.S. states and every Canadian province, and serves 99 of the 100 largest metropolitan areas in the U.S. Our size also gives us greater purchasing power, the ability to provide customers with a broader range of equipment and services, the ability to provide customers with equipment that is more consistently well-maintained and therefore more productive and reliable, and the ability to enhance the earning potential of our assets by transferring equipment among branches to satisfy customer needs.

Previous wording

We offer our equipment for rent to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. Our revenues are derived from the following sources: equipment rentals, sales of rental equipment, sales of new equipment, contractor supplies sales and service and other revenues. Equipment rentals represented 86 percent of total revenues for the three months ended March 31, 2026.

Current wording

We offer our equipment for rent to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. Our revenues are derived from the following sources: equipment rentals, sales of rental equipment, sales of new equipment, contractor supplies sales and service and other revenues. Equipment rentals represented 87 percent of total revenues for the six months ended June 30, 2026.

Previous wording

Prior to taking actions pertaining to our financial flexibility and liquidity, we assess our available sources and anticipated uses of cash, including, with respect to sources, cash generated from operations and from the sale of rental equipment. As of March 31, 2026, we had available liquidity of $3.377 billion, comprised of cash and cash equivalents, and availability under the ABL and accounts receivable securitization facilities.

Current wording

Prior to taking actions pertaining to our financial flexibility and liquidity, we assess our available sources and anticipated uses of cash, including, with respect to sources, cash generated from operations and from the sale of rental equipment. As of June 30, 2026, we had available liquidity of $2.999 billion, comprised of cash and cash equivalents, and availability under the ABL and accounts receivable securitization facilities.

Previous wording

In April 2025, our Board of Directors authorized a $1.5 billion share repurchase program, which was increased to $2.0 billion following the enactment of new federal tax legislation in July 2025. This program was completed in the first quarter of 2026. In January 2026, our Board of Directors authorized a new $5.0 billion share repurchase program that has no expiration date, and repurchases under this program began in March 2026, following completion of the prior $2.0 billion share repurchase program. We have repurchased $25 under the $5.0 billion program through March 31, 2026. We intend to complete $1.5 billion of total repurchases in 2026, comprised of $1.15 billion of repurchases under the $5.0 billion program and the $350 of repurchases made to complete the $2.0 billion program. A 1 percent excise tax is imposed on “net repurchases” (certain purchases minus certain issuances) of common stock. The repurchases above (as well as the total program sizes) do not include the excise tax, which totaled $2 year-to-date through March 31, 2026 (the total excise tax amount relates to both the current program and the prior program that was completed in the first quarter of 2026).

Current wording

In April 2025, our Board of Directors authorized a $1.5 billion share repurchase program, which was increased to $2.0 billion following the enactment of new federal tax legislation in July 2025. This program was completed in the first quarter of 2026. In January 2026, our Board of Directors authorized a new $5.0 billion share repurchase program that has no expiration date, and share repurchases under this program began in March 2026, following completion of the prior $2.0 billion share repurchase program. We have repurchased $400 under the $5.0 billion program through June 30, 2026. We intend to complete $1.5 billion of total share repurchases in 2026, comprised of $1.15 billion of share repurchases under the $5.0 billion program and the $350 of share repurchases made to complete the $2.0 billion program. A 1 percent excise tax is imposed on “net repurchases” (certain purchases minus certain issuances) of common stock. The share repurchases above (as well as the total program sizes) do not include the excise tax, which totaled $6 year-to-date through June 30, 2026 (the total excise tax amount relates to both the current program and the prior program that was completed in the first quarter of 2026).

Previous wording

During the three months ended March 31, 2026 and 2025, we paid dividends of $125 ($1.97 per share) and $118 ($1.79 per share), respectively. On April 22, 2026, our Board of Directors declared a quarterly dividend of $1.97 per share, payable on May 27, 2026 to stockholders of record on May 13, 2026.

Current wording

During the six months ended June 30, 2026 and 2025, we paid dividends of $248 ($3.94 per share) and $235 ($3.58 per share), respectively. On July 22, 2026, our Board of Directors declared a quarterly dividend of $1.97 per share, payable on August 26, 2026 to stockholders of record on August 12, 2026.

Previous wording

Merger Termination Benefit. In January 2025, we announced that we had signed a merger agreement to acquire H&E Equipment Services, Inc. d/b/a H&E Rentals (“H&E”). In February 2025, following the termination of that merger agreement, we received a break-up fee of $64. Our results for the three months ended March 31, 2025 include a net $39 merger termination benefit, which reflects this break-up fee, net of related transaction costs. The net merger termination benefit is comprised of $12 of professional fees recorded in selling, general and administrative ("SG&A") expenses, $13 of bridge financing fees recorded in interest expense, net, and the break-up fee of $64 recorded in other income, net. For the three months ended March 31, 2025, the impact of the merger termination was a $29 after-tax benefit, or $0.45 per diluted share, for net income and a $52 benefit for adjusted EBITDA (as defined below), cash flow from operating activities and free cash flow (as defined below).

Current wording

Merger Termination Benefit. In January 2025, we announced that we had signed a merger agreement to acquire H&E Equipment Services, Inc. d/b/a H&E Rentals (“H&E”). In February 2025, following the termination of that merger agreement, we received a break-up fee of $64. Our results for the six months ended June 30, 2025 include a net $39 merger termination benefit, which reflects this break-up fee, net of related transaction costs. The net merger termination benefit was comprised of $12 of professional fees recorded in selling, general and administrative ("SG&A") expenses, $13 of bridge financing fees recorded in interest expense, net, and the break-up fee of $64 recorded in other income, net. For the six months ended June 30, 2025, the impact of the merger termination was a $29 after-tax benefit, or $0.45 per diluted share, to net income and a $52 benefit to adjusted EBITDA (as defined below), cash flow from operating activities and free cash flow (as defined below).

Previous wording

Net income and diluted earnings per share for the three months ended March 31, 2025 include the impact of the H&E merger termination benefit discussed above. The impact of the merger termination for the three months ended March 31, 2025 was a net after-tax benefit of $29, or $0.45 per diluted share. Net income and diluted earnings per share include the after-tax impacts of the items below. The tax rates applied to the items below reflect the statutory rates in the applicable entities.

Current wording

Net income and diluted earnings per share for the three and six months ended June 30, 2026 include the impact of the gain associated with the sale of part of our scaffolding business that is discussed above. The impact of the gain on sale of business for the three and six months ended June 30, 2026 was a net after-tax benefit of $37, or $0.58 per diluted share. Net income and diluted earnings per share for the six months ended June 30, 2025 include the impact of the H&E merger termination benefit discussed above. The impact of the merger termination for the six months ended June 30, 2025 was a net after-tax benefit of $29, or $0.45 per diluted share. Net income and diluted earnings per share include the after-tax impacts of the items below. The tax rates applied to the items below reflect the statutory rates in the applicable entities.

Previous wording

Adjusted EBITDA for the three months ended March 31, 2025 includes the impact of the H&E merger termination benefit discussed above. The impact of the merger termination for the three months ended March 31, 2025 was a net after-tax benefit of $29 for net income and a $52 benefit for adjusted EBITDA. The merger termination did not impact the results for any other period in the table below. The table below provides a reconciliation between net income and EBITDA and adjusted EBITDA:

Current wording

Adjusted EBITDA for the three and six months ended June 30, 2026 includes the impact of the gain associated with the sale of part of our scaffolding business that is discussed above. The impact of the gain on sale of business for the three and six months ended June 30, 2026 was a net after-tax benefit of $37 to net income and a $49 benefit to adjusted EBITDA. Adjusted EBITDA for the six months ended June 30, 2025 includes the impact of the H&E merger termination benefit discussed above.

Previous wording

(4)The amount for the three months ended March 31, 2025 reflects bridge financing fees associated with the terminated H&E acquisition discussed above.

Current wording

(5)The amount for the six months ended June 30, 2025 reflects bridge financing fees associated with the terminated H&E acquisition discussed above.

Previous wording

For the three months ended March 31, 2026, net income increased $13, or 2.5 percent, to $531, and net income margin decreased 60 basis points to 13.3 percent, including the 2025 impact of the H&E merger termination benefit discussed above. Excluding the net after-tax merger termination benefit of $29 recognized in the three months ended March 31, 2025, net income margin for the three months ended March 31, 2026 increased 20 basis points year-over-year, primarily reflecting 1) increases in gross margins from equipment rentals and sales of rental equipment and 2) reductions in selling, general and administrative ("SG&A") expenses and interest expense as a percentage of revenue, partially offset by 3) $45 of restructuring charges incurred in the three months ended March 31, 2026, primarily under the restructuring program that was initiated in the fourth quarter of 2025. The increased gross margin from equipment rentals reflected increased margin for the general rentals segment, partially offset by reduced margin for the specialty segment, as explained further below (see “Results of Operations-Segment Equipment Rentals Gross Profit”). The restructuring charges are discussed in note 4 to the condensed consolidated financial statements. See “Results of Operations" for further discussion of the significant items impacting our operating results.

Current wording

For the six months ended June 30, 2026, net income increased $144, or 12.6 percent, to $1.284 billion, and net income margin increased 40 basis points to 15.3 percent, including the impacts of the $37 after-tax gain on sale of business recognized in the six months ended June 30, 2026 and the net after-tax H&E merger termination benefit of $29 recognized in the six months ended June 30, 2025, both of which are discussed above. The 2026 gain on sale of business and the 2025 merger termination benefit had offsetting impacts on the net income margin variance, and net income margin for the six months ended June 30, 2026 excluding these items increased 40 basis points year-over-year, primarily reflecting 1) increased gross margin from equipment rentals and 2) reductions in selling, general and administrative ("SG&A") expenses and interest expense as a percentage of revenue, partially offset by 3) $51 of restructuring charges incurred in the six months ended June 30, 2026, primarily under the restructuring program that was initiated in the fourth quarter of 2025. The increased gross margin from equipment rentals reflected increased margin for the general rentals segment, partially offset by reduced margin for the specialty segment, as explained further below (see “Results of Operations-Segment Equipment Rentals Gross Profit”). The restructuring charges are discussed in note 4 to the condensed consolidated financial statements. See “Results of Operations" for further discussion of the significant items impacting our operating results.

Previous wording

For the three months ended March 31, 2026, adjusted EBITDA increased $88, or 5.3 percent, to $1.759 billion, and adjusted EBITDA margin decreased 80 basis points to 44.1 percent, including the 2025 impact of the H&E merger termination benefit. Excluding the net merger termination benefit of $52 recognized in the three months ended March 31, 2025, adjusted EBITDA margin for the three months ended March 31, 2026 increased 60 basis points year-over-year, primarily reflecting a reduction in SG&A expenses as a percentage of revenue. See “Results of Operations" for further discussion of the significant items impacting our operating results.

Current wording

For the six months ended June 30, 2026, adjusted EBITDA increased $334, or 9.6 percent, to $3.815 billion, and adjusted EBITDA margin was flat year-over-year at 45.4 percent, including the impacts of the $49 gain on sale of business recognized in the six months ended June 30, 2026 and the net H&E merger termination benefit of $52 recognized in the six months ended June 30, 2025, both of which are discussed above. The 2026 gain on sale of business and the 2025 merger termination benefit had offsetting impacts on the adjusted EBITDA margin variance, and adjusted EBITDA margin for the six months ended June 30, 2026 excluding these items increased 10 basis points year-over-year, primarily reflecting a slight reduction in SG&A expenses as a percentage of revenue offset by a slight decrease in gross margin from equipment rentals (excluding depreciation and stock compensation expense). See “Results of Operations" for further discussion of the significant items impacting our operating results.

Previous wording

For the three months ended March 31, 2026, total revenues of $3.985 billion increased 7.2 percent compared with 2025. Equipment rentals and sales of rental equipment are our largest revenue types (together, they accounted for 95 percent of total revenue for the three months ended March 31, 2026). Equipment rentals increased $274, or 8.7 percent, primarily due to a 5.7 percent increase in average OEC and a 2.3 percent increase in fleet productivity. Sales of rental equipment did not change significantly year-over-year.

Current wording

For the three months ended June 30, 2026, total revenues of $4.410 billion increased 11.8 percent compared with 2025. Equipment rentals and sales of rental equipment are our largest revenue types (together, they accounted for 95 percent of total revenue for the three months ended June 30, 2026). Equipment rentals increased $434, or 12.7 percent, primarily due to a 7.1 percent increase in average OEC and a 3.4 percent increase in fleet productivity. Sales of rental equipment did not change significantly year-over-year.

Previous wording

Equipment rentals represented 86 percent of total revenues for the three months ended March 31, 2026. For the three months ended March 31, 2026, equipment rentals of $3.419 billion increased $274, or 8.7 percent, as compared to the same period in 2025, primarily due to a 5.7 percent increase in average OEC and a 2.3 percent increase in fleet productivity.

Current wording

Equipment rentals represented 87 percent of total revenues for the three months ended June 30, 2026. For the three months ended June 30, 2026, equipment rentals of $3.849 billion increased $434, or 12.7 percent, as compared to the same period in 2025, primarily due to a 7.1 percent increase in average OEC and a 3.4 percent increase in fleet productivity.

Previous wording

For the three months ended March 31, 2026, equipment rentals represented 83 percent of total revenues for the general rentals segment. For the three months ended March 31, 2026, general rentals equipment rentals increased $130, or 6.2 percent, as compared to the same period in 2025, primarily due to increases in average OEC and fleet productivity.

Current wording

For the three months ended June 30, 2026, equipment rentals represented 85 percent of total revenues for the general rentals segment. For the three months ended June 30, 2026, general rentals equipment rentals increased $150, or 6.6 percent, as compared to the same period in 2025, primarily reflecting increased average OEC.

Previous wording

For the three months ended March 31, 2026, equipment rentals represented 91 percent of total revenues for the specialty segment. For the three months ended March 31, 2026, specialty equipment rentals increased $144, or 13.8 percent, as compared to the same period in 2025, primarily due to increased average OEC.

Current wording

For the three months ended June 30, 2026, equipment rentals represented 92 percent of total revenues for the specialty segment. For the three months ended June 30, 2026, specialty equipment rentals increased $284, or 24.8 percent, as compared to the same period in 2025, primarily reflecting increased average OEC.

Previous wording

Sales of rental equipment. For the three months ended March 31, 2026, sales of rental equipment represented approximately 9 percent of our total revenues. For the three months ended March 31, 2026, sales of rental equipment did not change significantly year-over-year.

Current wording

Sales of rental equipment. For the six months ended June 30, 2026, sales of rental equipment represented approximately 8 percent of our total revenues. For the three and six months ended June 30, 2026, sales of rental equipment did not change significantly year-over-year.

Previous wording

Sales of new equipment. For the three months ended March 31, 2026, sales of new equipment represented approximately 2 percent of our total revenues. For the three months ended March 31, 2026, sales of new equipment increased 20.0 percent year-over-year, primarily due to normal variability.

Current wording

Sales of new equipment. For the six months ended June 30, 2026, sales of new equipment represented approximately 2 percent of our total revenues. For the three and six months ended June 30, 2026, sales of new equipment increased 14.7 percent and 17.2 percent year-over-year, respectively, primarily due to normal variability.

Previous wording

Contractor supplies sales represent our revenues associated with selling a variety of supplies, including construction consumables, tools, small equipment and safety supplies. For the three months ended March 31, 2026, contractor supplies sales represented approximately 1 percent of our total revenues. Contractor supplies sales for the three months ended March 31, 2026 did not change significantly year-over-year.

Current wording

Contractor supplies sales represent our revenues associated with selling a variety of supplies, including construction consumables, tools, small equipment and safety supplies. For the six months ended June 30, 2026, contractor supplies sales represented approximately 1 percent of our total revenues. Contractor supplies sales for the three and six months ended June 30, 2026 did not change significantly year-over-year.

Previous wording

Service and other revenues primarily represent our revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). For the three months ended March 31, 2026, service and other revenues represented approximately 2 percent of our total revenues. For the three months ended March 31, 2026, service and other revenues did not change significantly year-over-year.

Current wording

Service and other revenues primarily represent our revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). For the six months ended June 30, 2026, service and other revenues represented approximately 2 percent of our total revenues. For the three and six months ended June 30, 2026, service and other revenues did not change significantly year-over-year.

Previous wording

General rentals. For the three months ended March 31, 2026, equipment rentals gross profit increased by $74, and equipment rentals gross margin increased by 150 basis points, year-over-year. Gross margin increased primarily due to better cost performance and fixed cost absorption on higher revenue, as reflected in reductions in depreciation, labor and benefits, and delivery costs as a percentage of revenue.

Current wording

For the six months ended June 30, 2026, equipment rentals gross profit increased by $143, and equipment rentals gross margin increased by 100 basis points, year-over-year. Gross margin increased primarily due to better cost performance and fixed cost absorption on higher revenue, as reflected in reductions in depreciation and labor and benefits expenses as a percentage of revenue.

Previous wording

Specialty. For the three months ended March 31, 2026, equipment rentals gross profit increased by $42, and equipment rentals gross margin decreased by 170 basis points, year-over-year. Gross margin decreased primarily due to higher depreciation expense, increased delivery costs and changes in revenue mix driven by growth in lower-margin ancillary revenues.

Current wording

Specialty. For the three months ended June 30, 2026, equipment rentals gross profit increased by $111, and equipment rentals gross margin decreased by 140 basis points, year-over-year. Gross margin decreased primarily due to changes in revenue mix driven by growth in lower-margin ancillary and re-rent revenues, partially offset by a reduction in labor and benefits expenses as a percentage of revenue.

Previous wording

For the three months ended March 31, 2026, total gross margin increased 40 basis points from 2025. Equipment rentals gross margin increased 50 basis points from 2025, reflecting increased margin for the general rentals segment, partially offset by reduced margin for the specialty segment, as discussed above. Gross margin from sales of rental equipment did not change significantly. The gross margin fluctuations from sales of new equipment, contractor supplies sales and service and other revenues generally reflect normal variability, and such revenue types did not account for a significant portion of total gross profit (gross profit for these revenue types represented 4 percent of total gross profit for the three months ended March 31, 2026).

Current wording

For the three months ended June 30, 2026, total gross margin increased 40 basis points from 2025. Equipment rentals gross margin increased 30 basis points from 2025, reflecting increased margin for the general rentals segment, partially offset by reduced margin for the specialty segment, as discussed above. Gross margin from sales of rental equipment did not change significantly year-over-year. The gross margin fluctuations from sales of new equipment, contractor supplies sales and service and other revenues generally reflect normal variability, and such revenue types did not account for a significant portion of total gross profit (gross profit for these revenue types represented 4 percent of total gross profit for the three months ended June 30, 2026).

Previous wording

SG&A expense primarily includes sales force compensation, information technology costs, third party professional fees, management salaries, bad debt expense and clerical and administrative overhead. SG&A expense for the three months ended March 31, 2025 included $12 of professional fees associated with the terminated H&E acquisition discussed above. Excluding the impact of the 2025 costs associated with the terminated H&E acquisition, SG&A expense for the three months ended March 31, 2026 decreased year-over-year as a percentage of revenue primarily due to better fixed cost absorption on higher revenue.

Current wording

SG&A expense primarily includes sales force compensation, information technology costs, third party professional fees, management salaries, bad debt expense and clerical and administrative overhead. SG&A expense for the six months ended June 30, 2025 included $12 of professional fees associated with the terminated H&E acquisition discussed above. Excluding the impact of the 2025 costs associated with the terminated H&E acquisition, SG&A expense for the six months ended June 30, 2026 decreased year-over-year as a percentage of revenue primarily due to better fixed cost absorption on higher revenue.

Previous wording

Therestructuring charges primarily reflect severance and branch closure charges associated with our restructuring programs. We incur severance costs and branch closure charges in the ordinary course of our business. We only include such costs that are part of a restructuring program as restructuring charges. The designated restructuring programs generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition, and result in significant costs that we would not normally incur absent a major acquisition or other triggering event that results in the initiation of a restructuring program. The amounts above primarily reflect charges associated with the restructuring program that was initiated in the fourth quarter of 2025 (see note 4 to the condensed consolidated financial statements for additional detail on our restructuring programs). Since the first such program was initiated in 2008, we have completed seven restructuring programs and have incurred total restructuring charges of $429.

Current wording

Therestructuring charges primarily reflect severance and branch closure charges associated with our restructuring programs. We incur severance costs and branch closure charges in the ordinary course of our business. We only include such costs that are part of a restructuring program as restructuring charges. The designated restructuring programs generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition, and result in significant costs that we would not normally incur absent a major acquisition or other triggering event that results in the initiation of a restructuring program. The amounts above primarily reflect charges associated with the restructuring program that was initiated in the fourth quarter of 2025 (see note 4 to the condensed consolidated financial statements for additional detail on our restructuring programs). Since the first such program was initiated in 2008, we have completed seven restructuring programs and have incurred total restructuring charges of $435.

Previous wording

Interest expense, net for the three months ended March 31, 2026 did not change significantly year-over-year, as the impact of decreased variable debt interest rates and the 2025 fees associated with the terminated H&E acquisition was partially offset by increased average debt. The weighted average interest rates on our variable debt instruments were 4.8 percent and 5.6 percent for the three months ended March 31, 2026 and 2025, respectively. Interest expense, net for the three months ended March 31, 2025 included $13 of bridge financing fees associated with the terminated H&E acquisition discussed above.

Current wording

Interest expense, net for the three and six months ended June 30, 2026 did not change significantly year-over-year, as the impact of decreased variable debt interest rates was offset by increased average debt. The weighted average interest rates on our variable debt instruments were 4.8 percent for the three and six months ended June 30, 2026, and 5.6 percent for the three and six months ended June 30, 2025. Interest expense, net for the six months ended June 30, 2025 included $13 of bridge financing fees associated with the terminated H&E acquisition discussed above.

Previous wording

Other income, net primarily includes (i) currency gains and losses, (ii) finance charges, (iii) gains and losses on sales of non-rental equipment and (iv) other miscellaneous items. Other income, net for the three months ended March 31, 2025 included $64 of income associated with the receipt of the break-up fee associated with the terminated H&E acquisition discussed above.

Current wording

Other income, net primarily includes (i) currency gains and losses, (ii) finance charges, (iii) gains and losses on sales of non-rental equipment and (iv) other miscellaneous items. Our results for the three and six months ended June 30, 2026 include the gain of $49 associated with the sale of part of our scaffolding business that is discussed above, and this gain was primarily recognized in other income, net. Other income, net for the six months ended June 30, 2025 included $64 of income associated with the receipt of the break-up fee associated with the terminated H&E acquisition discussed above.

Previous wording

Balance sheet. Accounts payable increased by $309, or 39.8 percent, from December 31, 2025 to March 31, 2026, primarily due to seasonal increases in capital expenditures and business activities. See the condensed consolidated statements of cash flows for further information on changes in cash and cash equivalents, the condensed consolidated statements of stockholders’ equity for further information on changes in stockholders’ equity and note 6 to the condensed consolidated financial statements for further information on debt changes.

Current wording

Balance sheet. Accounts receivable, net increased by $287, or 11.4 percent, from December 31, 2025 to June 30, 2026, primarily due to increased revenue. Accounts payable increased by $834, or 107.5 percent, from December 31, 2025 to June 30, 2026, primarily due to seasonal increases in capital expenditures and business activities. See the condensed consolidated statements of cash flows for further information on changes in cash and cash equivalents, the condensed consolidated statements of stockholders’ equity for further information on changes in stockholders’ equity and note 6 to the condensed consolidated financial statements for further information on debt changes.

Previous wording

In April 2025, our Board of Directors authorized a $1.5 billion share repurchase program, which was increased to $2.0 billion following the enactment of new federal tax legislation in July 2025. This program was completed in the first quarter of 2026. In January 2026, our Board of Directors authorized a new $5.0 billion share repurchase program that has no expiration date, and repurchases under this program began in March 2026, following completion of the prior $2.0 billion share repurchase program. We have repurchased $25 under the $5.0 billion program through March 31, 2026. We intend to complete $1.5 billion of total repurchases in 2026, comprised of $1.15 billion of repurchases under the $5.0 billion program and the $350 of repurchases made to complete the $2.0 billion program. A 1 percent excise tax is imposed on “net repurchases” (certain purchases minus certain issuances) of common stock. The repurchases above (as well as the total program sizes) do not include the excise tax, which totaled $2 year-to-date through March 31, 2026 (the total excise tax amount relates to both the current program and the prior program that was completed in the first quarter of 2026). Since 2012, we have repurchased a total of $9.773 billion (inclusive of excise taxes, which were first imposed in 2023) of Holdings' common stock under our share repurchase programs (comprised of ten programs that have ended, including the program that was completed in the first quarter of 2026, and the current program).

Current wording

In April 2025, our Board of Directors authorized a $1.5 billion share repurchase program, which was increased to $2.0 billion following the enactment of new federal tax legislation in July 2025. This program was completed in the first quarter of 2026. In January 2026, our Board of Directors authorized a new $5.0 billion share repurchase program that has no expiration date, and share repurchases under this program began in March 2026, following completion of the prior $2.0 billion share repurchase program. We have repurchased $400 under the $5.0 billion program through June 30, 2026. We intend to complete $1.5 billion of total share repurchases in 2026, comprised of $1.15 billion of share repurchases under the $5.0 billion program and the $350 of share repurchases made to complete the $2.0 billion program. A 1 percent excise tax is imposed on “net repurchases” (certain purchases minus certain issuances) of common stock. The share repurchases above (as well as the total program sizes) do not include the excise tax, which totaled $6 year-to-date through June 30, 2026 (the total excise tax amount relates to both the current program and the prior program that was completed in the first quarter of 2026). Since 2012, we have repurchased a total of $10.152 billion (inclusive of excise taxes, which were first imposed in 2023) of Holdings' common stock under our share repurchase programs (comprised of ten programs that have ended, including the program that was completed in the first quarter of 2026, and the current program).

Previous wording

During the three months ended March 31, 2026 and 2025, we paid dividends totaling $125 ($1.97 per share) and $118 ($1.79 per share), respectively. On April 22, 2026, our Board of Directors declared a quarterly dividend of $1.97 per share, payable on May 27, 2026 to stockholders of record on May 13, 2026.

Current wording

During the six months ended June 30, 2026 and 2025, we paid dividends totaling $248 ($3.94 per share) and $235 ($3.58 per share), respectively. On July 22, 2026, our Board of Directors declared a quarterly dividend of $1.97 per share, payable on August 26, 2026 to stockholders of record on August 12, 2026.

Previous wording

Our principal existing sources of cash are cash generated from operations and from the sale of rental equipment, and borrowings available under our ABL and accounts receivable securitization facilities. As of March 31, 2026, we had cash and cash equivalents of $156. We believe that our existing sources of cash will be sufficient to support our existing operations over the next 12 months. The table below presents financial information associated with our principal sources of cash as of and for the three months ended March 31, 2026:

Current wording

Our principal existing sources of cash are cash generated from operations and from the sale of rental equipment, and borrowings available under our ABL and accounts receivable securitization facilities. As of June 30, 2026, we had cash and cash equivalents of $112. We believe that our existing sources of cash will be sufficient to support our existing operations over the next 12 months. The table below presents financial information associated with our principal sources of cash as of and for the six months ended June 30, 2026:

Previous wording

Sources and Uses of Cash. During the three months ended March 31, 2026, we (i) generated cash from operating activities of $1.514 billion and (ii) generated cash from the sale of rental and non-rental equipment of $363. We used cash during this period principally to (i) make payments for purchases of rental and non-rental equipment and intangible assets of $833, (ii) purchase other companies for $396, (iii) make debt payments, net of proceeds, of $394, (iv) purchase shares of our common stock for $421 and (v) pay dividends of $125. During the three months ended March 31, 2025, we (i) generated cash from operating activities of $1.425 billion, including $52 associated with the H&E merger termination benefit discussed above, and (ii) generated cash from the sale of rental and non-rental equipment of $391. We used cash during this period principally to (i) make payments for purchases of rental and non-rental equipment and intangible assets of $745, (ii) make debt payments, net of proceeds, of $538, (iii) purchase shares of our common stock for $289 and (iv) pay dividends of $118.

Current wording

Sources and Uses of Cash. During the six months ended June 30, 2026, we (i) generated cash from operating activities of $3.305 billion, (ii) generated cash from the sale of rental and non-rental equipment of $706 and (iii) received proceeds from the sale of part of our scaffolding business of $82. We used cash during this period principally to (i) make payments for purchases of rental and non-rental equipment and intangible assets of $2.885 billion, (ii) purchase other companies for $400, (iii) make debt payments, net of proceeds, of $91, (iv) purchase shares of our common stock for $816 and (v) pay dividends of $248. Cash paid for income taxes, net decreased from $540 for the six months ended June 30, 2025 to $158 for the six months ended June 30, 2026, primarily due to the impact of federal tax legislation that was enacted in July 2025 (such tax legislation did not materially impact our effective tax rate). During the six months ended June 30, 2025, we (i) generated cash from operating activities of $2.753 billion, including $52 associated with the H&E merger termination benefit discussed above, and (ii) generated cash from the sale of rental and non-rental equipment of $725. We used cash during this period principally to (i) make payments for purchases of rental and non-rental equipment and intangible assets of $2.303 billion, (ii) make debt payments, net of proceeds, of $123, (iii) purchase shares of our common stock for $720 and (iv) pay dividends of $235.

Previous wording

Free cash flow for the three months ended March 31, 2026 did not change significantly year-over-year, as the impact of increased net cash provided by operating activities was offset by higher net payments for rental capital expenditures (payments for purchases of rental equipment less the proceeds from sales of rental equipment). Net cash provided by operating activities and free cash flow for the three months ended March 31, 2025 both included the $52 H&E merger termination benefit discussed above.

Current wording

Free cash flow for the six months ended June 30, 2026 did not change significantly year-over-year, as the impact of higher net payments for rental capital expenditures (payments for purchases of rental equipment less the proceeds from sales of rental equipment) was offset by increased net cash provided by operating activities. Net cash provided by operating activities and free cash flow for the six months ended June 30, 2025 both included the $52 H&E merger termination benefit discussed above.

Previous wording

All of the existing guarantees by Holdings and the guarantor subsidiaries rank equally in right of payment with all of the guarantors' existing and future senior indebtedness. The secured indebtedness of Holdings and the guarantor subsidiaries (including guarantees of URNA’s existing and future secured indebtedness) will rank effectively senior to guarantees of any unsecured indebtedness to the extent of the value of the assets securing such indebtedness. Future guarantees of subordinated indebtedness will rank junior to any existing and future senior indebtedness of the guarantors. The guarantees of URNA’s indebtedness are effectively junior to any indebtedness of our subsidiaries that are not guarantors, including our foreign subsidiaries. As of March 31, 2026, the indebtedness, net of debt issuance costs, of our non-guarantors was comprised of (i) $1.500 billion of outstanding borrowings by the SPV in connection with the Company’s accounts receivable securitization facility, (ii) $145 of outstanding borrowings under the ABL facility by non-guarantor subsidiaries and (iii) $13 of finance leases of our non-guarantor subsidiaries.

Current wording

All of the existing guarantees by Holdings and the guarantor subsidiaries rank equally in right of payment with all of the guarantors' existing and future senior indebtedness. The secured indebtedness of Holdings and the guarantor subsidiaries (including guarantees of URNA’s existing and future secured indebtedness) will rank effectively senior to guarantees of any unsecured indebtedness to the extent of the value of the assets securing such indebtedness. Future guarantees of subordinated indebtedness will rank junior to any existing and future senior indebtedness of the guarantors. The guarantees of URNA’s indebtedness are effectively junior to any indebtedness of our subsidiaries that are not guarantors, including our foreign subsidiaries. As of June 30, 2026, the indebtedness, net of debt issuance costs, of our non-guarantors was comprised of (i) $1.414 billion of outstanding borrowings by the SPV in connection with the Company’s accounts receivable securitization facility, (ii) $147 of outstanding borrowings under the ABL facility by non-guarantor subsidiaries and (iii) $15 of finance leases of our non-guarantor subsidiaries.