Herc Holdings Inc. (NYSE:HRI) posted stronger-than-expected revenue in the second quarter of 2025, supported by its recent acquisition of H&E Equipment Services. However, the company’s earnings lagged behind analyst projections, and shares moved up slightly—rising 0.55% in after-hours trading following the results.
Total revenue for the quarter reached $1 billion, significantly exceeding the consensus estimate of $876.23 million. This performance was driven primarily by a 14% year-over-year increase in equipment rental revenue, which totaled $870 million. Still, adjusted earnings per share came in at $1.87, missing expectations of $2.05.
Herc finalized its purchase of H&E Equipment Services on June 2, a transaction described by CEO Larry Silber as “the largest in the industry.” The deal involved $4.4 billion in new debt financing at a weighted average interest rate of 6.8%.
The company recorded a net loss of $35 million, or $1.17 per share, largely attributed to acquisition-related costs and losses associated with Cinelease assets held for sale.
“With the merger now behind us, our focus is on integration, optimization and ensuring delivery of the revenue and cost synergy targets we established,” said Silber. “The teams are working very well together, united in their shared commitment to our customers’ success and energized by the unique opportunity that our combined strengths represent.”
Adjusted EBITDA rose 13% to $406 million, but the adjusted EBITDA margin declined to 41% from 42.5% a year ago. The company cited an increased mix of lower-margin used equipment sales and the integration of H&E’s operations as factors behind the margin dip.
Looking ahead, Herc updated its full-year 2025 outlook—excluding its Cinelease studio entertainment division—expecting equipment rental revenue between $3.7 billion and $3.9 billion, and adjusted EBITDA between $1.8 billion and $1.9 billion.
As of June 30, Herc reported net debt of $8.3 billion, with a net leverage ratio of 3.8x, up from 2.6x in the same period last year.
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