Herc Revenue Rises 5% to $1.364 Billion as Company Raises 2026 Forecast
Key Facts
Herc Holdings reported third-quarter 2026 revenue rose 5% to $1.364 billion, compared with $1.304 billion in the same period a year earlier. Net income was $104 million, or $3.10 per diluted share, versus $30 million, or $0.90 per share, a year earlier. The company said equipment rental revenue hit a record $1.254 billion, up 12% year over year. Adjusted EBITDA rose 9% to $603 million from $551 million. The announcement came with an increase to the company’s full-year forecast, signaling continued strength in rental activity during the quarter.
Adjusted EBITDA margin improved to 44.2% from 42.3% in the year-earlier quarter, while equipment time utilization by dollar value rose to 43.5% from 39.9%. These metrics reflect increased revenue from rental assets and improved utilization, alongside business expansion. Herc said strong performance was driven by high volumes of mega projects, as well as double-digit growth in specialty solutions. It added that revenue synergies from its acquisition of H&E contributed to performance. The company identified data centers, infrastructure, manufacturing facilities and energy projects as areas of opportunity for its business.
Business growth was accompanied by cost pressures: direct operating expenses were $532 million, or 42.4% of equipment rental revenue, compared with $467 million and 41.6% a year earlier. Herc attributed the increase to transportation and fuel costs, as well as higher field incentive compensation. The rise in expenses as a share of rental revenue puts some of the revenue growth in the context of fleet operating costs. At the same time, adjusted EBITDA margin rose to 44.2% from 42.3%, reflecting improvement in the measure despite higher direct expenses. Net income was $104 million, compared with $30 million in the third quarter of 2025.
The company raised its 2026 equipment rental revenue forecast to a range of $4.475 billion to $4.550 billion, and also increased its adjusted EBITDA forecast to $2.10–$2.15 billion. The revisions also covered net capital expenditures for rental equipment, which it expected to be between $1.0 billion and $1.1 billion, and estimated total capital expenditures of $1.45 billion to $1.60 billion. The figures show that the forecast update covered revenue, earnings and equipment investment. As of September 30, 2026, net debt was $8.0 billion and net leverage was 3.90 times. The company estimated liquidity at about $2.1 billion on the same date.
In trading ahead of the results announcement, Herc shares closed at $127.13 on October 26, while Polaris shares closed at $55.15 and Xylem shares at $108.24. These prices alone do not establish the direction of share movements or any connection to the companies’ results. Polaris had announced that it would release third-quarter results and hold its earnings call on October 27, 2026, at 8:00 a.m. Central Time. Xylem set 6:55 a.m. Eastern Time for the release of its quarterly results, followed by a management call with investors at 9:00 a.m. Results for either company’s third quarter were not included in the information available when those times were announced.
Earlier results provide context for the reporting dates: Polaris posted sales of $2.023 billion in the second quarter of 2026, up 9% year over year, and diluted earnings per share of $1.82. The company attributed sales growth at the time to strength in off-road vehicles and the timing of shipments, among other factors. Xylem’s second-quarter revenue was $2.336 billion, compared with $2.301 billion in the second quarter of 2025, while operating margin rose to 16.7% from 13.3%. Ahead of its expected announcement, a Reuters report published on October 26 said Xylem shares had fallen 25% during the year and analysts expected earnings of $1.45 per share and revenue of $2.28 billion for the third quarter. Herc is scheduled to webcast its results on October 27 at 8:30 a.m. Eastern Time.