Avis Budget Group (CAR) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $2.4 billion, with an adjusted EBITDA loss of $93 million and a net loss of $505 million, outperforming prior EBITDA guidance but reflecting anticipated fleet rotation costs.

• Strong leisure demand offset softer commercial volume, while calendar shifts (leap year, Easter) impacted year-over-year comparisons.

• Accelerated fleet rotation led to a record number of risk vehicle disposals and a $390 million non-cash fleet charge; no further charges expected from this strategy.

• Technology investments and operational efficiencies improved vehicle utilization and cost management.

• Leadership transition announced, with CEO stepping down at the end of June 2024.

Financial highlights

• Q1 adjusted EBITDA loss of $93 million, down from a positive $12 million in Q1 2024, driven by $120 million lower revenue and higher fleet costs.

• Total company revenue decreased to $2.4 billion from $2.5 billion year-over-year.

• Net loss per share was $14.35, compared to $3.21 in Q1 2024.

• Per-unit fleet costs were $351, up from $318 last year but below the $400 guidance; Americas per-unit fleet costs per month (excluding accelerated disposal costs) were $378, flat year-over-year.

• Liquidity at quarter-end exceeded $1.1 billion, with $3 billion in additional fleet funding capacity.

Outlook and guidance

• Q2 per-unit fleet costs expected to be ~$325, improving to ~$300 by Q4.

• Q2 adjusted EBITDA expected to exceed $200 million.

• Long-term target remains above $1 billion in adjusted EBITDA annually, though macroeconomic uncertainty persists.

• Forward bookings and leisure demand are trending above prior year; pricing momentum expected into summer peak.

• Management will continue to monitor demand trends and adjust fleet size as needed.