RYDER SYSTEM INC
For the period ended Jun 30, 2026. Filed Jul 23, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Jul 23, 2026
R$266.39-1.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-04-23.
0001628280-26-026847
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-07-23.
0001628280-26-049417
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 194 previous paragraphs and 196 current paragraphs.
139 unchanged; 41 reworded; 15 added; 14 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 37 previous and 37 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
•Total revenue of $3.3 billion, up 5% from prior year, due to higher revenue in Supply Chain Solutions (SCS) and FMS
Current report
•Operating revenue (a non-GAAP measure) of $2.7 billion, up 3% from prior year, primarily reflecting contractual revenue growth in SCS
Current report
Total revenue increased 5% in the second quarter of 2026, and 2% in the six months ended June 30, 2026, reflecting higher operating revenue and fuel revenue due to higher prices passed through to customers. Operating revenue (a non-GAAP measure excluding fuel and subcontracted transportation) increased 3% in the second quarter of 2026, and 2% for the six months ended June 30, 2026, reflecting contractual revenue growth in SCS and FMS, partially offset by lower DTS fleet count.
Current report
EBT and comparable EBTincreased in thesecond quarter primarily due to improved FMS performance, partially offset by lower SCS results and a non-cash intangible asset impairment charge. The increase in EBT was also partially offset by an $8 million non-cash charge for the partial settlement of our Canadian pension plan’s projected benefit obligation.
Current report
EBT and comparable EBTdecreased in the six months ended June 30, 2026. The decrease in EBT is primarily due to lower SCS results and a non-cash intangible asset impairment charge, partially offset by improved FMS performance. The decrease in EBT also includes an $8 million non-cash charge for the partial settlement of our Canadian pension plan’s projected benefit obligation.
Current report
Services gross margin increased slightly in the second quarter and remained consistent for the six months ended June 30, 2026. Service gross margin percentage slightly decreased in the second quarter and remained consistent for the six months ended June 30, 2026.
Current report
Lease & related maintenance and rental gross margin decreased 2% in the second quarter and the six months ended June 30, 2026, due to higher maintenance and insurance costs. Lease & related maintenance and rental gross margin percentage slightly decreased in the second quarter primarily due to higher maintenance costs and remained consistent for the six months ended June 30, 2026.
Current report
(1) Represents percentage change compared to prior year period in average sales proceeds on used vehicle sales using constant currency.
Current report
Miscellaneous Income, net
Current report
FMS total revenue increased 6% in the second quarter of 2026 and increased 4% for the six months ended June 30, 2026, due to higher fuel prices passed through to customers and higher operating revenue. FMS operating revenue increased 1% in the second quarter and for the six months ended June 30, 2026, primarily reflecting contractual revenue growth, partially offset by lower commercial rental demand.
Current report
FMS EBT increased 20% in the second quarter and 14% for the six months ended June 30, 2026, due to strategic initiatives benefiting ChoiceLease performance and higher used vehicle sales results reflecting improving market conditions and elevated wholesale activity in the prior year. Used truck and tractor pricing increased 6% and 3%, respectively in the second quarter of 2026 and increased 2% and 5%, respectively, in the six months ended June 30, 2026. Sequentially, pricing was stable as used truck and tractor retail pricing increased 7% and 3%, respectively, on a lower retail sales mix. Rental power fleet utilization was
Current report
75% in the second quarter of 2026, compared with 70% in the prior year, on a 15% smaller average fleet. Rental power fleet utilization was 72% for the six months ended June 30, 2026, compared with 68% in the prior year, on a 14% smaller average fleet.
Current report
Total CSS costs decreased 3% in the second quarter of 2026, primarily due to lower marketing expense, and was relatively consistent for the six months ended June 30, 2026.
Current report
Unallocated CSS costs decreased 10% in the second quarter of 2026, and 2% for the six months ended June 30, 2026, primarily due to lower compensation-related expense.
Current report
(1)Refer to Note 6, "Revenue Earning Equipment, net," in the Notes to Condensed Consolidated Financial Statements for additional information.
Removed paragraphs (14)
Previous report
•Total revenue of $3.1 billion, consistent with prior yearup —%
Previous report
•Operating revenue (a non-GAAP measure) of $2.6 billion, consistent with prior year
Previous report
Total revenue in the first quarter of 2026 was consistent with prior year. Operating revenue (a non-GAAP measure excluding fuel and subcontracted transportation) increased 1% in the first quarter of 2026, reflecting new business in SCS, partially offset by lower DTS fleet count.
Previous report
EBT and comparable EBT (a non-GAAP measure) decreased in the first quarter of 2026, primarily due to lower automotive results in SCS.
Previous report
Services gross margin decreased in the first quarter of 2026, primarily due to lower automotive results and productivity of new business ramping up in SCS. Service gross margin as a percentage of revenue remained consistent.
Previous report
Lease & related maintenance and rental gross margin decreased 3% in the first quarter of 2026, primarily due to lower commercial rental demand and unfavorable development of prior year rental insurance claims, partially offset by improved contractual performance. Lease & related maintenance and rental gross margin percentage remained at 31% in the first quarter of 2026.
Previous report
Miscellaneous Loss, net
Previous report
FMS total revenue increased 1% in the first quarter of 2026, due to higher fuel pricing passed through to customers. FMS operating revenue (a non-GAAP measure excluding fuel) was consistent with prior year as contractual revenue growth was offset by lower rental demand.
Previous report
FMS EBT increased 6% in the first quarter of 2026, primarily from higher contractual business performance, which benefited from strategic initiatives. Higher used vehicle sales results reflected improving market conditions. Used truck and tractor pricing decreased 5% and increased 6%, respectively. Rental power fleet utilization was 68% in the first quarter, compared to 66% in the prior year, on a 13% smaller average fleet.
Previous report
Total CSS and Unallocated CSS costs increased 4% and 7%, respectively, in the first quarter of 2026, primarily due to higher incentive-based compensation costs.
Previous report
Cash and cash equivalents totaled $182 million as of March 31, 2026. As of March 31, 2026, $141 million was held outside the U.S. and is available to fund operations and growth of non-U.S. subsidiaries. We continue to consider the historical earnings of our former U.K. business to be no longer indefinitely reinvested and determined that there was no impact to deferred taxes. We consider the undistributed earnings of our Mexico subsidiary generated through 2023 to be indefinitely reinvested. As of 2024, we no longer assert that the current year earnings of our Mexico subsidiary are indefinitely reinvested. We consider the undistributed earnings of our Canada subsidiary generated through 2024 to be indefinitely reinvested. As of 2025, we no longer assert that current year earnings of our Canada subsidiary are indefinitely reinvested. Our remaining foreign jurisdictions are indefinitely reinvested.
Previous report
(1)Refer to the table below for a composition of Other items impacting comparability, net, for the 12-month rolling period.
Previous report
(2)Represents income taxes on other items impacting comparability.
Previous report
(3)Represents the impact of other items impacting comparability, net of tax, to equity for the respective periods.
Reworded paragraphs (41)
Previous wording
Selected Operating Performance Items For The First Quarter 2026
Current wording
Selected Operating Performance Items For The Second Quarter 2026
Previous wording
•Diluted EPS from continuing operations of $2.34, up 2% from prior year
Current wording
•Diluted EPS from continuing operations of $3.40, up 8% from prior year
Previous wording
•Comparable EPS (a non-GAAP measure) from continuing operations of $2.54, up 3% from prior year, reflecting share repurchases, partially offset by lower earnings
Current wording
•Comparable EPS (a non-GAAP measure) from continuing operations of $3.73, up 12% from prior year, reflects share repurchases and higher earnings in Fleet Management Solutions (FMS)
Previous wording
During the three months ended March 31, 2026, the strength and resiliency of our transformed business model enabled the business to deliver solid results in the current environment. FMS had earnings growth driven by its contractual business, reflecting benefits from the ongoing execution of our strategic initiatives. In addition, SCS delivered another quarter of strong earnings performance, although results were down relative to a record quarter in the prior year. DTS continued to be impacted by a lower fleet count due to the prolonged freight downturn.
Current wording
During the three and six months ended June 30, 2026, the strength and resiliency of our transformed business model enabled the business to deliver solid results in the current environment. FMS had earnings growth driven by strong performance in our contractual business as well as better used vehicle sales results. In addition, SCS and DTS delivered solid earnings reflecting consistent execution of our strategic initiatives.
Previous wording
We continue to benefit from favorable long-term secular trends in logistics and transportation solutions and have experienced positive momentum in contractual sales in the first quarter of 2026, with record sales performance in SCS and stronger sales in FMS and DTS above prior year and ahead of expectations, in segments that had been experiencing sales headwinds from freight market conditions. We also experienced improving trends in used vehicle sales, and rental demand reflected historical seasonal patterns. We remain on track to deliver $70 million in expected earnings benefits from strategic initiatives this year, and are well positioned for growth from a cycle upturn with the largest impact expected in our transactional rental and used vehicle sales businesses. Favorable secular trends and the value our solutions bring to our customers remain strong and provide long-term revenue and earnings growth opportunities for all of our business segments.
Current wording
We continue to benefit from favorable long-term secular trends in logistics and transportation solutions and have experienced strong contractual sales activity across all three of our business segments. We also experienced improving trends in used vehicle sales as market conditions continued to strengthen, and rental utilization returned to normalized levels driven by our planned asset management actions. In addition, we remain on track to achieve $70 million in expected earnings benefits from strategic initiatives this year, and are well positioned for growth from a cycle upturn.
Previous wording
While we are experiencing positive momentum in our businesses, other unknown effects from inflationary cost pressures, regulatory changes, geopolitical events, labor interruptions, introduction of tariffs and taxes and the continued higher interest rate environment may negatively impact demand for our business, financial results and significant judgments and estimates.
Current wording
Favorable secular trends and the value our solutions bring to our customers remain strong and provide long-term revenue and earnings growth opportunities for all of our business segments. While we are experiencing positive momentum in our businesses, inflationary cost pressures, regulatory changes, geopolitical events, labor interruptions, changes in tariff, trade or tax policies and the continued higher interest rate environment may negatively impact demand for our business, financial results and significant judgments and estimates.
Previous wording
Services revenue represents all the revenue associated with our SCS and DTS business segments, including subcontracted transportation and fuel, as well as SelectCare revenue associated with our FMS business segment. Services revenue decreased 1% in the first quarter of 2026, primarily driven by lower fleet count in DTS, partially offset by new business in SCS.
Current wording
Services revenue represents all the revenues associated with our SCS and DTS business segments, including subcontracted transportation and fuel, as well as SelectCare and fleet support services associated with our FMS business segment. Services revenue increased 5% in the second quarter and increased 2% in the six months ended June 30, 2026, primarily driven by new business in SCS.
Previous wording
Cost of services represents the direct costs related to services revenue and is primarily comprised of salaries and employee-related costs, subcontracted transportation (purchased transportation from third parties), fuel, equipment and maintenance costs. Cost of services decreased slightly less than revenue in the first quarter of 2026.
Current wording
Cost of services represents the direct costs related to services revenue and is primarily comprised of salaries and employee-related costs, subcontracted transportation (purchased transportation from third parties), fuel, lease expense, insurance and maintenance costs. Cost of services increased slightly more than revenue for the three and six months ended June 30, 2026, primarily due to costs incurred to ramp up new business in SCS.
Previous wording
Lease & related maintenance and rental revenue represent revenue from our ChoiceLease and commercial rental product offerings within our FMS business segment. Revenue increased 1% in the first quarter of 2026, reflecting contractual revenue growth, partially offset by lower rental demand.
Current wording
Lease & related maintenance and rental revenue represent revenue from our ChoiceLease and commercial rental product offerings within our FMS business segment. Revenue increased 1% in the second quarter and for the six months ended June 30, 2026, reflecting contractual revenue growth, partially offset by lower rental demand.
Previous wording
Cost of lease & related maintenance and rental represents the direct costs related to Lease & related maintenance and rental revenue and are comprised of depreciation of revenue earning equipment, maintenance costs (primarily repair parts and labor), and other costs such as licenses, insurance and operating taxes. Cost of lease & related maintenance and rental excludes interest costs from vehicle financing, which are reported within "Interest expense" in our Condensed Consolidated Statements of Earnings. Cost of lease & related maintenance and rental increased 2% in the first quarter of 2026, reflecting revenue growth, higher equipment costs and unfavorable development of prior year rental insurance claims.
Current wording
Cost of lease & related maintenance and rental represents the direct costs related to Lease & related maintenance and rental revenue and is comprised of depreciation of revenue earning equipment, maintenance costs (primarily repair parts and labor), and other costs such as licenses, insurance and operating taxes. Cost of lease & related maintenance and rental excludes interest costs from vehicle financing, which are reported within "Interest expense" in our Condensed Consolidated Statements of Earnings. Cost of lease & related maintenance and rental increased 2% in the second quarter and six months ended June 30, 2026, primarily reflecting revenue growth and higher maintenance and insurance costs.
Previous wording
Fuel services revenue represents fuel services provided to our FMS customers. Fuel services revenue increased 5% in the first quarter of 2026, primarily reflecting higher fuel prices passed through to customers, partially offset by lower gallons sold.
Current wording
Fuel services revenue represents fuel services provided to our FMS customers. Fuel services revenue increased 45% in the second quarter and increased 24% in the six months ended June 30, 2026, primarily reflecting higher fuel prices passed through to customers.
Previous wording
Cost of fuel services includes the direct costs associated with providing our customers with fuel. These costs include fuel, salaries and employee-related costs of fuel island attendants and depreciation of our fueling facilities and equipment. Cost of fuel services remained unchanged in the first quarter of 2026, due to higher fuel prices offset by lower gallons sold.
Current wording
Cost of fuel services includes the direct costs associated with providing our customers with fuel. These costs include fuel, salaries and employee-related costs of fuel island attendants and depreciation of our fueling facilities and equipment. Cost of fuel services increased 48% in the second quarter and increased 23% in the six months ended June 30, 2026, primarily due to higher fuel prices.
Previous wording
Fuel services gross margin and gross margin as a percentage of revenue increased in the first quarter of 2026, compared to prior year. Fuel is largely a pass-through to customers for which we realize minimal changes in margin during periods of steady market fuel prices. However, fuel services margin is impacted by sudden increases or decreases in market fuel prices during a short period of time, as customer pricing for fuel is established based on current market fuel costs. Fuel services gross margin and gross margin as a percentage of revenue for the first quarter of 2026 were impacted by these price change dynamics as fuel prices rapidly increased during the period.
Current wording
Fuel services gross margin and fuel services gross margin as a percentage of revenue decreased in the second quarter and increased for the six months ended June 30, 2026. Fuel is largely a pass-through to customers for which we realize minimal changes in margin during periods of steady market fuel prices. However, fuel services margin is impacted by sudden increases or decreases in market fuel prices during a short period of time, as customer pricing for fuel is established based on current market fuel costs. Fuel services gross margin and fuel services gross margin as a percentage of revenue in the second quarter of 2026 were positively impacted by these price change dynamics but were impacted more favorably in the prior year. Fuel services gross margin and fuel services gross margin as a percentage of revenue for the six months ended June 30, 2026 were positively impacted by these price change dynamics.
Previous wording
SG&A expenses increased 3% in the first quarter of 2026. The increase in SG&A expenses in the first quarter of 2026 primarily reflects higher incentive-based compensation expenses. SG&A expenses as a percentage of total revenue remained at 12% for the first quarter of 2026.
Current wording
SG&A expenses increased 3% in the second quarter of 2026 and for the six months ended June 30, 2026, primarily reflecting a non-cash impairment charge related to an intangible asset and higher compensation-related expenses. SG&A expenses as a percentage of total revenue remained consistent at 12% for the second quarter and for the six months ended June 30, 2026.
Previous wording
Non-operating pension costs, net include the amortization of net actuarial loss and prior service cost, interest cost and expected return on plan assets components of pension and postretirement benefit costs, as well as any significant charges for settlements or curtailments if recognized. Non-operating pension costs, net remained consistent in the first quarter of 2026.
Current wording
"Non-operating pension costs, net" include the amortization of net actuarial loss and prior service cost, interest cost and expected return on plan assets components of pension and postretirement benefit costs, as well as any significant charges for settlements or curtailments if recognized. The second quarter of 2026 and the six months ended June 30, 2026, includes an $8 million non-cash charge for the partial settlement of our Canadian pension plan’s projected benefit obligation. Refer to Note 13, Employee Benefit Plans," for further discussion.
Previous wording
Used vehicle sales, net includes gains or losses from sales of used vehicles, selling costs associated with used vehicles and write-downs of vehicles held for sale to fair market values (referred to as "valuation adjustments"). Used vehicle sales, net increased primarily due to higher pricing from improved retail sales mix in the first quarter of 2026.
Current wording
Used vehicle sales, net includes gains or losses from sales of used vehicles, selling costs associated with used vehicles and write-downs of vehicles held for sale to fair market value (referred to as "valuation adjustments"). Net gains on used vehicle sales increased in the second quarter and six months ended June 30, 2026, primarily due to higher pricing and an improved retail sales mix. In the prior year, we drove higher sales through the wholesale channel in order to manage aged inventory levels.
Previous wording
The following table presents the average used vehicle proceeds per unit changes, using constant currency, compared to the prior year:
Current wording
Average proceeds per unit increased in the second quarter and for the six months ended June 30, 2026. The following table presents the average used vehicle pricing changes compared to the prior year:
Previous wording
Interest expense decreased 3% in the first quarter of 2026, primarily reflecting a lower average debt balance and effective interest rate.
Current wording
Interest expense decreased 4% in the second quarter and for the six months ended June 30, 2026, respectively, primarily reflecting a reduced average debt balance and lower effective interest rate.
Previous wording
Miscellaneous loss, net consists of investment income or loss on securities used to fund certain benefit plans, interest income, gains or losses on sales of operating property, foreign currency transaction remeasurement and other non-operating items. Miscellaneous loss, net was $1 million in the first quarter of 2026, compared to $6 million in prior year, primarily due to reduced investment portfolio losses.
Current wording
Miscellaneous income, net consists of investment income on securities used to fund certain benefit plans, interest income, gains on sales of operating property, foreign currency transaction remeasurement and other non-operating items. Miscellaneous income, net increased to $22 million in the second quarter of 2026, and increased to $21 million for the six months ended June 30, 2026, primarily due to better market performance of investments classified as trading securities used to fund certain benefit plans.
Previous wording
Our effective tax rate on continuing operations and comparable effective tax rate on continuing operations was 21.0% and 20.9% in the first quarter of 2026, respectively, compared to 26.8% and 25.6%, respectively, in the prior year. The decrease in tax rates was primarily due to excess tax benefits on stock-based compensation in the first quarter of 2026.
Current wording
In the second quarter of 2026, our effective tax rate on continuing operations and comparable effective tax rate on continuing operations was 28.2% and 27.7%, respectively, compared to 28.3% and 28.0%, respectively, in the prior year. For the six months ended June 30, 2026, our effective tax rate on continuing operations and comparable effective tax rate on continuing operations was 25.4% and 25.1% respectively, compared to 27.7% and 27.0%, respectively, in the prior year. The decrease in tax rates for both periods was primarily due to higher excess tax benefits on stock-based compensation.
Previous wording
Our FMS segment leases revenue earning equipment, and provides rental vehicles, fuel, maintenance and other ancillary services to the SCS and DTS segments. Inter-segment EBT allocated to SCS and DTS includes earnings related to equipment used in providing services to SCS and DTS customers. EBT related to inter-segment equipment and services billed to SCS and DTS customers (Equipment Contribution) are included in both FMS and the segment that served the customer and then eliminated upon consolidation (presented as "Eliminations").
Current wording
Our FMS segment leases revenue earning equipment, and provides rental vehicles, fuel, maintenance and other ancillary services to the SCS and DTS segments. Inter-segment EBT allocated to SCS and DTS includes earnings related to equipment used in providing services to SCS and DTS customers. EBT related to inter-segment equipment and services billed to SCS and
Previous wording
(1)For the three months ended March 31, 2026 and 2025, rental revenue from lease customers in place of a lease vehicle represented 31% of commercial rental revenue for both periods.
Current wording
(1)For the three months ended June 30, 2026 and 2025, rental revenue from lease customers in place of a lease vehicle represented 28% of commercial rental revenue for both periods. For the six months ended June 30, 2026 and 2025, rental revenue from lease customers in place of a lease vehicle represented 29% of commercial rental revenue for both periods.
Previous wording
Our fleet of owned and leased revenue earning equipment and SelectCare vehicles, including vehicles under on-demand maintenance, is summarized as follows (number of units rounded to the nearest hundred):
Current wording
Our North America fleet of owned and leased revenue earning equipment and SelectCare vehicles, including vehicles under on-demand maintenance, is summarized as follows (number of units rounded to the nearest hundred):
Previous wording
The following table provides information on our active ChoiceLease fleet (number of units rounded to nearest hundred) and our commercial rental power fleet utilization (excludes trailers):
Current wording
The following table provides information on our North America active ChoiceLease fleet (number of units rounded to nearest hundred) and our commercial rental power fleet (excludes trailers):
Previous wording
SCS total revenue increased 2% in the first quarter of 2026, reflecting higher operating revenue (a non-GAAP measure excluding subcontracted transportation and fuel). SCS operating revenue increased 3% in the first quarter of 2026, driven by new business in omnichannel retail, partially offset by lost business and lower volumes in automotive.
Current wording
SCS total revenue increased 8% in the second quarter of 2026 and 5% for the six months ended June 30, 2026, primarily reflecting increased operating revenue (a non-GAAP measure excluding fuel and subcontracted transportation). SCS operating revenue increased 7% in the second quarter of 2026 and 5% for the six months ended June 30, 2026, driven by new business, partially offset by lost business in automotive.
Previous wording
SCS EBT decreased to $72 million in the first quarter of 2026, primarily reflecting lower automotive results and, to a lesser extent, productivity of new business ramping up.
Current wording
SCS EBT decreased 7% in the second quarter of 2026, and decreased 12% for the six months ended June 30, 2026, primarily due to lower automotive results and, to a lesser extent, productivity of new business ramping up, partially offset by the optimization of the omnichannel retail network.
Previous wording
DTS total revenue decreased 8% in the first quarter of 2026, primarily due to lower subcontracted transportation costs and operating revenue (a non-GAAP measure excluding subcontracted transportation and fuel). DTS operating revenue decreased 5% in the first quarter of 2026, reflecting lower fleet count due to prolonged freight market downturn.
Current wording
DTS total revenue decreased 1% in the second quarter of 2026 and 5% for the six months ended June 30, 2026, due to lower operating revenue (a non-GAAP measure excluding fuel and subcontracted transportation) and subcontracted transportation costs passed through to customers, partially offset by higher fuel revenue in the second quarter of 2026. DTS operating revenue decreased 3% in the second quarter of 2026 and 4% in the six months ended June 30, 2026, reflecting lower fleet count, partially offset by higher pricing.
Previous wording
DTS EBT decreased 15% in the first quarter of 2026, primarily reflecting lower operating revenue, partially offset by benefits from strategic initiatives.
Current wording
DTS EBT decreased 4% in the second quarter of 2026, and 8% for the six months ended June 30, 2026, primarily reflecting lower operating revenue and adverse development of prior year insurance claims, partially offset by benefits from strategic initiatives.
Previous wording
Net cash provided by operating activities from continuing operations was $583 million for the three months ended March 31, 2026, compared to $651 million in the prior year, primarily reflecting working capital needs. Our working capital needs are primarily influenced by the timing of receivable collections and vendor payments, as well as other changes in operating assets and liabilities. During the period, we had unfavorable impacts from the timing of receivable collections in our DTS and SCS segments and the timing of vendor payments. Net cash used in investing activities from continuing operations decreased to $321 million for the three months ended March 31, 2026, compared with $393 million in 2025, primarily reflecting lower capital expenditures. Net cash used in financing activities from continuing operations was $277 million for the three months ended March 31, 2026, compared with $261 million in 2025, primarily reflecting higher share repurchases partially offset with net borrowings in 2026 compared to net debt payments in 2025.
Current wording
Net cash provided by operating activities from continuing operations was $1.3 billion for the six months ended June 30, 2026, compared to $1.4 billion in the prior year, primarily reflecting an increase of accounts receivable in conjunction with revenue growth and the timing of vendor payments. Net cash used in investing activities from continuing operations decreased to $588 million for the six months ended June 30, 2026, compared with $943 million in 2025, primarily reflecting lower capital expenditures. Net cash used in financing activities from continuing operations was $650 million for the six months ended June 30, 2026, compared with $444 million in 2025, primarily reflecting higher net debt repayments and share repurchases.
Previous wording
Free cash flow (a non-GAAP measure) increased to $273 million for the three months ended March 31, 2026, compared to $259 million in 2025, primarily reflecting reduced cash capital expenditures, partially offset by lower cash provided by operating activities.
Current wording
Free cash flow (a non-GAAP measure) increased to $684 million for the six months ended June 30, 2026, compared to $461 million in 2025, primarily reflecting reduced cash capital expenditures.
Previous wording
Gross capital expenditures decreased to $409 million for the three months ended March 31, 2026, compared to $536 million in 2025, primarily reflecting the timing of ChoiceLease fleet replacement and reduced investments in the rental fleet.
Current wording
Gross capital expenditures decreased to $812 million for the six months ended June 30, 2026, compared to $1.2 billion in 2025, primarily reflecting the timing of ChoiceLease fleet replacement and reduced investments in the rental fleet.
Previous wording
We utilize external capital primarily to support working capital needs and growth in our asset-based product lines. The variety of financing alternatives typically available to fund our capital needs include commercial paper, medium-term and long-term public and private debt, asset-backed securities, bank term loans, leasing arrangements and bank credit facilities. Our principal sources of financing are issuances of unsecured commercial paper and medium-term notes.
Current wording
We utilize external capital primarily to support working capital needs and growth in our asset-based product lines. The variety of financing alternatives typically available to fund our capital needs include commercial paper, medium-term and long-term public and private debt, bank term loans, leasing arrangements and bank credit facilities. Our principal sources of financing are issuances of unsecured commercial paper and medium-term notes.
Previous wording
We believe that our cash generated from operations and our access to the commercial paper and public bond markets will be sufficient to meet our operating, investing and financing needs, including our debt maturities and other short‑term obligations, over the next twelve months. However, volatility or disruption in the commercial paper or public debt market may impair our ability to access these markets or secure terms commercially acceptable to us. If we cease to have access to commercial paper, public bonds and other sources of unsecured borrowings, we would meet our liquidity needs by drawing upon contractually committed lending agreements or by seeking other funding sources.
Current wording
Cash and cash equivalents totaled $219 million as of June 30, 2026, of which $171 million was held outside the U.S. and is available to fund the operations and growth of our non-U.S. subsidiaries. We believe that cash generated from operations, together with our access to the commercial paper and public debt markets, will be sufficient to meet our operating, investing and financing needs, including debt maturities and other short-term obligations, over the next twelve months. Our global revolving credit facility, in conjunction with operating cash flow, provides financial flexibility to refinance upcoming debt maturities. Consistent with our historical funding practices, we intend to refinance certain debt obligations as they mature through a combination of commercial paper and medium-term debt issuances, depending on market conditions and funding requirements. However, volatility or disruption in the commercial paper or public debt markets could impair our ability to access these markets or obtain financing on commercially acceptable terms. If access to these markets become unavailable, we believe our committed revolving credit facility and other available funding sources would provide sufficient liquidity to meet our obligations as they become due.
Previous wording
(1) In April 2026, the long-term rating was upgraded to Baa1 with a stable outlook.
Current wording
In April 2026, Moody’s long-term rating was upgraded to Baa1 with a stable outlook.
Previous wording
In accordance with our funding philosophy, we attempt to align the aggregate average remaining repricing life of our debt with the aggregate average remaining repricing life of our vehicle assets. We utilize both fixed-rate and variable-rate debt to achieve this alignment and generally target a mix of 20% - 40% variable-rate debt as a percentage of total debt outstanding. The variable-rate portion of our total debt (including notional value of swap agreements) was 18% as of both March 31, 2026 and December 31, 2025, respectively.
Current wording
In accordance with our funding philosophy, we attempt to align the aggregate average remaining repricing life of our U.S. debt with the aggregate average remaining repricing life of our U.S. vehicle assets. We utilize both fixed-rate and variable-rate debt to achieve this alignment and generally target a mix of 20% - 40% variable-rate debt as a percentage of total debt outstanding. The variable-rate portion of our total debt (including notional value of swap agreements) was 17% and 18% as of June 30, 2026 and December 31, 2025, respectively.
Previous wording
Our debt-to-equity ratio was 269% and 250% as of March 31, 2026 and December 31, 2025, respectively. The debt-to-equity ratio represents total debt divided by total equity.
Current wording
Our debt-to-equity ratio was 259% and 250% as of June 30, 2026 and December 31, 2025, respectively. The debt-to-equity ratio represents total debt divided by total equity.
Previous wording
In February 2026 and 2025, our board of directors declared a quarterly cash dividend of $0.91 and $0.81 per share of common stock, respectively.
Current wording
In July 2026, our board of directors declared a quarterly cash dividend of $1.01 per share of common stock, an increase of 11% compared to the quarterly dividend of $0.91 per share of common stock declared in July 2025.
Previous wording
The following table provides a reconciliation of GAAP Earnings from continuing operations before income taxes (EBT), Earnings from continuing operations, and Earnings from continuing operations per common share — Diluted (Diluted EPS) to comparable EBT, comparable earnings, and comparable EPS. Certain items included in EBT, Earnings from continuing operations, and Diluted EPS have been excluded from our comparable EBT, comparable earnings and comparable diluted EPS measures. The following table lists a summary of these items, which are discussed in more detail throughout our MD&A and within the Notes to Condensed Consolidated Financial Statements:
Current wording
The following table provides a reconciliation of GAAP Earnings from continuing operations before income taxes (EBT), Earnings from continuing operations, and Earnings from continuing operations per common share — Diluted (Diluted EPS) to comparable EBT, comparable earnings and comparable EPS, respectively. Certain items included in EBT, Earnings from continuing operations and Diluted EPS have been excluded from our comparable EBT, comparable earnings and comparable diluted EPS measures. The following table lists a summary of these items, which are discussed in more detail throughout our MD&A and within the Notes to Condensed Consolidated Financial Statements:
Previous wording
•our expectations regarding cash flow from operating activities, free cash flow, capital expenditures and full-year guidance;
Current wording
•our expectations regarding cash flow from operating activities, free cash flow, capital expenditures and other financial outlook;
Previous wording
•the adequacy of our accounting estimates and reserves, including those related to goodwill and asset impairments, residual values, depreciation assumptions, deferred income taxes, effective tax rates, variable revenue considerations, the valuation of our pension plans, allowance for credit losses and self-insurance loss reserves;
Current wording
•the adequacy of our accounting estimates and reserves, including those related to goodwill, acquired intangible assets, customer relationship intangible assets and other asset impairments, residual values, depreciation assumptions, deferred income taxes, effective tax rates, variable revenue considerations, the valuation of our pension plans, allowance for credit losses and self-insurance loss reserves;
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Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
DTS customers (Equipment Contribution) are included in both FMS and the segment that served the customer and then eliminated upon consolidation (presented as "Eliminations").