Roman Tiraspolsky
Hertz Global Holdings (NASDAQ:HTZ) sank to a 52-week low after falling short of profit estimates with its Q1 earnings report.
Revenue was up 1.5% year-over-year to $2.08B to top the consensus expectation by $30M, but EPS came in -$1.28 in comparison to the consensus estimate of -$0.43 and the $0.39 mark from a year ago. Notably, Hertz (HTZ) highlighted that vehicle depreciation in the quarter increased $588M, or $339 on a per-unit basis, primarily driven by deterioration in estimated forward residual values and disposition losses on ICE vehicles compared to gains in the prior year quarter. Additionally, of the $339 per unit increase, $119 was related to electric vehicles held for sale.
Hertz (HTZ) disclosed adjusted corporate EBITDA was -$567M in the quarter, driven lower mainly by a $588M increase in vehicle depreciation compared to a year ago, of which $195M related to EVs held for sale. Back in 2021, Hertz (HTZ) made a big bet on EVs, with an order for 100K Tesla (TSLA) vehicles.
CEO update: “Fleet and direct operating costs weighed on this quarter’s performance… We’re tackling both issues – getting to the right supply of vehicles at an acceptable capital cost while at the same time driving productivity up and operating costs down.”
Shares of Hertz Global (HTZ) fell 20.15% in afternoon trading on Wednesday. Avis Budget Group (CAR) showed a 5.65% loss.
