Revenue surged 20.2% year-over-year to $1.2B in Q2 2026, but net margin remains razor-thin at 1.6% and gross margin fell to 31.3% from 33.1%, indicating integration costs are pressuring profitability.
Herc Holdings Inc. (HRI) annual income statement — 20-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 |
|---|
| Sales/Revenue | 4.86B | 4.38B | 3.57B | 3.28B | 2.74B | 2.07B | 1.78B | 2B | 1.98B | 1.75B | 1.55B | 1.68B | 1.77B | 1.74B | 1.61B | 8.3B | 7.56B | 7.1B | 8.53B | 8.69B | 8.06B |
| Revenue Growth % | 28.5% | 22.65% | 8.71% | 19.78% | 32.18% | 16.38% | -10.89% | 1.13% | 12.66% | 12.84% | -7.35% | -5.21% | 2.01% | 7.92% | -80.62% | 9.73% | 6.49% | -16.7% | -1.85% | 7.78% | - |
| Cost of Goods Sold | 3.45B | 3.14B | 2.22B | 2.06B | 1.68B | 1.32B | 1.25B | 1.46B | 1.45B | 1.33B | 1.2B | 1.28B | 1.32B | 1.26B | 0 | 6.47B | 6.15B | 6.02B | 7.12B | 6.65B | 6.23B |
| COGS % of Revenue | - | 71.8% | 62.16% | 62.74% | 61.13% | 63.53% | 70.44% | 72.87% | 73.59% | 75.77% | 77.4% | 76.09% | 74.67% | 72.63% | - | 77.99% | 81.33% | 84.71% | 83.57% | 76.53% | 77.35% |
| Gross Profit | 1.41B | 1.23B | 1.35B | 1.22B | 1.06B | 756M | 526.6M | 542.3M | 522M | 425.2M | 351.4M | 401.3M | 448.4M | 475M | 678.8M | 1.83B | 1.41B | 1.09B | 1.4B | 2.04B | 1.83B |
| Gross Margin % | 28.93% | 28.2% | 37.84% | 37.26% | 38.87% | 36.47% | 29.56% | 27.13% | 26.41% | 24.23% | 22.6% | 23.91% | 25.33% | 27.37% | 42.21% | 22.01% | 18.67% | 15.29% | 16.43% | 23.47% | 22.65% |
| Gross Profit Growth % | - | -8.59% | 10.38% | 14.84% | 40.87% | 43.56% | -2.9% | 3.89% | 22.77% | 21% | -12.43% | -10.5% | -5.6% | -30.02% | -62.83% | 29.34% | 30.03% | -22.48% | -31.27% | 11.66% | - |
| Operating Expenses | 703M | 564M | 480M | 448M | 411M | 310M | 257.4M | 294.8M | 311.3M | 319.1M | 274.5M | 262.6M | 251.4M | 204.3M | 502.4M | 745.28M | 664.51M | 641.15M | 769.63M | 775.88M | 723.92M |
| OpEx % of Revenue | - | 12.89% | 13.45% | 13.65% | 15% | 14.95% | 14.45% | 14.75% | 15.75% | 18.19% | 17.66% | 15.65% | 14.2% | 11.77% | 31.24% | 8.98% | 8.79% | 9.03% | 9.03% | 8.93% | 8.98% |
| Selling, General & Admin | 620M | 564M | 480M | 448M | 411M | 310M | 257.4M | 294.8M | 311.3M | 319.1M | 274.5M | 262.6M | 251.4M | 204.3M | 212.6M | 745.28M | 664.51M | 641.15M | 769.63M | 775.88M | 723.92M |
| SG&A % of Revenue | - | 12.89% | 13.45% | 13.65% | 15% | 14.95% | 14.45% | 14.75% | 15.75% | 18.19% | 17.66% | 15.65% | 14.2% | 11.77% | 13.22% | 8.98% | 8.79% | 9.03% | 9.03% | 8.93% | 8.98% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 2M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 289.8M | 0 | 0 | 0 | 0 | 0 | 0 |
| Operating Income | 702M | 670M | 870M | 775M | 654M | 446M | 269.2M | 247.5M | 210.7M | 106.1M | 76.9M | 138.7M | 197M | 270.7M | 176.4M | 1.08B | 747.52M | 444.82M | 631.24M | 1.26B | 1.1B |
| Operating Margin % | 14.46% | 15.31% | 24.38% | 23.61% | 23.87% | 21.51% | 15.11% | 12.38% | 10.66% | 6.05% | 4.95% | 8.26% | 11.13% | 15.6% | 10.97% | 13.03% | 9.88% | 6.26% | 7.4% | 14.53% | 13.67% |
| Operating Income Growth % | - | -22.99% | 12.26% | 18.5% | 46.64% | 65.68% | 8.77% | 17.47% | 98.59% | 37.97% | -44.56% | -29.59% | -27.23% | 53.46% | -83.68% | 44.61% | 68.05% | -29.53% | -49.99% | 14.61% | - |
| EBITDA | 1.24B | 1.75B | 997M | 887M | 749M | 514M | 331.7M | 308.5M | 268M | 157.6M | 121.7M | 215.9M | 272.1M | 339.6M | 537.7M | 2.96B | 2.6B | 2.44B | 2.89B | 1.26B | 1.1B |
| EBITDA Margin % | 25.51% | 39.99% | 27.94% | 27.03% | 27.34% | 24.8% | 18.62% | 15.43% | 13.56% | 8.98% | 7.83% | 12.86% | 15.37% | 19.57% | 33.43% | 35.68% | 34.41% | 34.39% | 33.92% | 14.53% | 13.67% |
| EBITDA Growth % | 20.88% | 75.53% | 12.4% | 18.42% | 45.72% | 54.96% | 7.52% | 15.11% | 70.05% | 29.5% | -43.63% | -20.65% | -19.88% | -36.84% | -81.84% | 13.78% | 6.55% | -15.54% | 129.09% | 14.56% | - |
| D&A (Non-Cash Add-back) | 537M | 1.08B | 127M | 112M | 95M | 68M | 62.5M | 61M | 57.3M | 51.5M | 44.8M | 77.2M | 75.1M | 68.9M | 361.3M | 1.88B | 1.85B | 2B | 2.26B | 0 | 505K |
| EBIT | 578M | 417M | 743M | 663M | 559M | 378M | 206.7M | 247.5M | 210.7M | 106.1M | 76.9M | 138.7M | 197M | 270.7M | 176.4M | 1.02B | 759.83M | 509.26M | 0 | 0 | 0 |
| Net Interest Income | -522M | -416M | -260M | -224M | -122M | -86M | -92.6M | -119.9M | -131.6M | -128.6M | -84.2M | -32.9M | -41.4M | -72.9M | -80.9M | -705.27M | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -5.55M | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 522M | 416M | 260M | 224M | 122M | 86M | 92.6M | 119.9M | 131.6M | 128.6M | 84.2M | 32.9M | 41.4M | 72.9M | 80.9M | 699.72M | 773.43M | 680.27M | 0 | 0 | 0 |
| Other Income/Expense | -646M | -669M | -579M | -328M | -220M | -155M | -175.1M | -183.9M | -141.9M | -170.5M | -81.8M | 18.2M | -52.5M | -117.6M | -87.8M | 323.19B | -761.12M | -615.83M | -1.64B | -1.1B | -1.05B |
| Pretax Income | 56M | 1M | 291M | 447M | 434M | 291M | 94.1M | 63.6M | 68.8M | -64.4M | -4.9M | 156.9M | 144.5M | 153.1M | 88.6M | 324.27M | -13.59M | -171.01M | -1.01B | 161.99M | 47.95M |
| Pretax Margin % | 1.15% | 0.02% | 8.16% | 13.62% | 15.84% | 14.04% | 5.28% | 3.18% | 3.48% | -3.67% | -0.32% | 9.35% | 8.16% | 8.82% | 5.51% | 3.91% | -0.18% | -2.41% | -11.85% | 1.86% | 0.6% |
| Income Tax | -3M | 0 | 80M | 100M | 104M | 67M | 20.4M | 16.1M | -300K | -224.7M | 14.8M | 45.6M | 54.8M | 55M | -207.47M | -128.54M | -17.07M | 59.67M | 196.85M | -102.57M | -67.99M |
| Effective Tax Rate % | -5.36% | 0% | 27.49% | 22.37% | 23.96% | 23.02% | 21.68% | 25.31% | -0.44% | 348.91% | -302.04% | 29.06% | 37.92% | 35.92% | -234.16% | -39.64% | 125.56% | -34.89% | -19.49% | -63.32% | -141.8% |
| Net Income | 49M | 1M | 211M | 347M | 330M | 224M | 73.7M | 47.5M | 69.1M | 160.3M | -19.7M | 111.3M | 89.7M | 98.1M | 61.4M | 452.81M | -48.04M | -126.02M | -1.21B | 264.56M | 115.94M |
| Net Margin % | 1.01% | 0.02% | 5.91% | 10.57% | 12.04% | 10.81% | 4.14% | 2.38% | 3.5% | 9.14% | -1.27% | 6.63% | 5.07% | 5.65% | 3.82% | 5.46% | -0.64% | -1.77% | -14.16% | 3.05% | 1.44% |
| Net Income Growth % | 113.04% | -99.53% | -39.19% | 5.15% | 47.32% | 203.93% | 55.16% | -31.26% | -56.89% | 913.71% | -117.7% | 24.08% | -8.56% | 59.77% | -86.44% | 1042.49% | 61.88% | 89.56% | -556.13% | 128.18% | - |
| Net Income (Continuing) | 59M | 1M | 211M | 347M | 330M | 224M | 73.7M | 47.5M | 69.1M | 160.3M | -19.7M | 111.3M | 89.7M | 98.1M | 61.4M | 452.81M | -48.04M | -126.02M | -1.21B | 264.56M | 115.94M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 19M | 19M | 16.5M | 17.29M | 0 | 0 | 0 |
| EPS (Diluted) | 1.46 | 0.03 | 7.40 | 12.09 | 10.92 | 7.37 | 2.51 | 1.63 | 2.39 | 5.60 | -0.72 | 3.93 | 3.17 | 3.47 | 2.17 | 20.36 | -2.33 | -6.79 | -74.79 | 16.26 | 9.53 |
| EPS Growth % | 68.97% | -99.57% | -38.79% | 10.71% | 48.17% | 193.63% | 53.99% | -31.8% | -57.32% | 877.78% | -118.32% | 23.97% | -8.65% | 59.91% | -89.34% | 973.82% | 65.68% | 90.92% | -559.96% | 70.62% | - |
| EPS (Basic) | - | 0.03 | 7.43 | 12.18 | 11.15 | 7.57 | 2.53 | 1.66 | 2.43 | 5.66 | -0.73 | 3.93 | 3.17 | 3.47 | 2.17 | 21.78 | -2.33 | -6.79 | -74.79 | 16.47 | 9.56 |
| Diluted Shares Outstanding | 33.5M | 31.4M | 28.5M | 28.7M | 30.2M | 30.4M | 29.4M | 29.1M | 28.9M | 28.6M | 28.3M | 28.31M | 28.31M | 28.31M | 28.3M | 22.24M | 20.6M | 18.57M | 16.14M | 16.27M | 12.17M |
| Basic Shares Outstanding | 33.4M | 31.3M | 28.4M | 28.5M | 29.6M | 29.6M | 29.1M | 28.7M | 28.4M | 28.3M | 28.14M | 28.31M | 28.31M | 28.31M | 21.01M | 20.79M | 20.6M | 18.57M | 16.14M | 16.06M | 12.12M |
| Dividend Payout Ratio | - | 8700% | 36.49% | 21.04% | 20.61% | 6.7% | - | - | - | - | - | - | - | - | - | - | - | - | - | - | 13343.63% |
Quick answers to the most common questions about buying HRI stock.
For fiscal year 2025, Herc Holdings Inc. (HRI) reported total revenue of $4.38B. This represents a 45.7% decline compared to $8.06B in 2006.
Herc Holdings Inc. (HRI) is profitable, generating $1.0M in net income for the fiscal year ending 2025 with a net profit margin of 0.0%.
Herc Holdings Inc. (HRI) reported an operating income of $670.0M, resulting in an operating profit margin of 15.3%. This margin reflects the operational efficiency of the business before interest and taxes.
Herc Holdings Inc. (HRI) generated $1.23B in gross profit for the year, representing a gross profit margin of 28.2%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Integration and interest costs
Metrics are mathematically derived from official filings.
Revenue Surge on H&E Integration
HRI's revenue grew 22.6% year-over-year in Q2 2026, reaching $1.2B, driven largely by the H&E acquisition. According to recent financial statements, this marks the fourth consecutive quarter of accelerating growth, though organic contributions remain unclear.
The 20.2% reported growth in Q2 2026, while robust, appears to be heavily influenced by the H&E acquisition, as organic growth for the legacy fleet is likely in the mid-single digits. The sequential revenue increase from Q1 to Q2 (from $1.1B to $1.2B) suggests continued momentum, but investors should monitor whether this pace is sustainable as integration synergies materialize and comparables become more challenging.
Gross Margin Compression Post-Acquisition
Gross margin fell to 31.3% in Q2 2026 from 33.1% a year earlier, reflecting integration costs and a changing mix. As reported in the income statement, this is a 180 basis point decline, signaling pressure on pricing power.
The decline in gross margin from the mid-30s in 2024 to the low-30s in 2026 suggests that the H&E fleet is being integrated at lower initial margins, possibly due to higher depreciation or maintenance costs. While management expects operational leverage to improve, the current trend indicates that the specialty mix has not yet offset the dilution from the acquired general rental assets.
Operating Leverage Masked by One-Time Costs
Operating income rose to $144M in Q2 2026, but operating margin contracted to 12.0% from 20.5% a year ago. Based on reported figures, SG&A as a percentage of revenue increased, suggesting that overhead is not scaling with the larger revenue base.
The sharp drop in operating margin from 20.5% in Q2 2025 to 12.0% in Q2 2026 indicates that the company is absorbing significant integration and financing costs. While revenue grew 20%, operating income fell 30%, implying that the cost structure is not yet optimized for the new scale. Investors should watch for SG&A efficiency improvements in the coming quarters as management claims a 'turning point'.
Net Income Volatility Raises Red Flags
Net income swung from -$35M in Q2 2025 to $19M in Q2 2026, yet the net margin remains razor-thin at 1.6%. According to the latest earnings release, EPS of $0.57 missed consensus by a wide margin, suggesting non-operating items are distorting profitability.
The erratic net income pattern, including losses in Q1 2025 and Q4 2024, points to significant non-operating charges, likely from acquisition-related costs and interest expense. The negative SBC in Q2 2026 is unusual and may indicate a reversal or adjustment, which warrants further investigation. The quality of earnings is questionable, as the reported net income does not yet reflect the operational improvements management cites.
COGS and SG&A Outpacing Revenue Growth
COGS increased 23.4% year-over-year in Q2 2026, slightly outpacing revenue growth of 20.2%. As disclosed in the income statement, SG&A also rose 22.0%, indicating that cost control is lagging behind the expansion.
The fact that both COGS and SG&A are growing faster than revenue suggests that the company is not yet realizing economies of scale from the H&E acquisition. This could be due to higher maintenance costs on an aging fleet or integration-related inefficiencies. Management's guidance for improved margins in the back half of the year implies that these cost pressures are expected to abate, but the current data does not confirm that.
Thin Margins Expose Fragility
Despite 22.6% revenue growth, HRI's net margin is effectively zero, a stark contrast to peers like URI at 15.5%. Based on reported figures, the company's profitability is highly sensitive to interest rates and integration costs, leaving little room for error.
Short-sellers would likely highlight that HRI's net margin of 0.02% is unsustainable for a company with a 5.73% debt-to-equity ratio. The heavy debt load and rising interest rates could continue to suppress earnings, even if operational metrics improve. The raised guidance may be overly optimistic if the Q2 EPS miss was not purely transitory. Investors should demand evidence of margin expansion before giving credit for the growth story.