Custom Truck One Source (CTOS) Q3 2026 earnings summary

Executive summary

• Q3 revenue was $495.2M, up 2.7% YoY; Adjusted EBITDA rose 15.6% to $110.9M, and net income was $2.3M versus a $5.8M loss.

• Strong rental and T&D demand supported results; more than $20M of STEM third-party deliveries were delayed into Q4 by a vendor recall and hail damage.

Financial highlights

• Q3 gross profit was $113.3M, up 12.4%; Adjusted Gross Profit rose 9.4% to $170.2M.

• Nine-month revenue was $1.52B and net income was $8.6M versus a $51.9M loss; Adjusted EBITDA was $325.7M versus $262.8M.

• Q3 operating income increased to $38.1M from $32.6M, while net interest expense declined to $37.1M from $40.2M.

• Nine-month operating cash flow was $231.7M; investing cash outflow was $232.9M.

Outlook and guidance

• FY2026 revenue guidance remains $2.10B–$2.20B; Adjusted EBITDA guidance increased to $447.5M–$460M, implying 17%–20% YoY growth.

• SER revenue guidance rose to $870M–$890M; STEM revenue guidance is $1.63B–$1.70B, with results expected toward the upper end of the range.

• Net rental fleet investment guidance increased to $210M–$230M; levered free cash flow is expected to be slightly positive in 2026.

• Q4 STEM third-party new sales are expected to grow at a mid-to-high-teens rate YoY as delayed deliveries ship.

• Double-digit Adjusted EBITDA growth is expected in 2027; net leverage is targeted below 3x that year.