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What changed in HERTZ GLOBAL HOLDINGS, INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of HERTZ GLOBAL HOLDINGS, INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+395 added−391 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-18)

Top changes in HERTZ GLOBAL HOLDINGS, INC's 2025 10-K

395 paragraphs added · 391 removed · 229 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

52 edited+22 added−7 removed83 unchanged
Biggest changeIf our customers develop loyalty to internet travel intermediaries rather than our brands, our business and revenues could be adversely affected. Certain internet travel intermediaries, such as online travel agencies and third-party internet sites, use generic indicators of the type of vehicle (such as “standard” or “compact”) at the expense of brand identification.
Biggest changeCertain internet travel intermediaries, such as online travel agencies and third-party internet sites, use generic indicators of the type of vehicle (such as “standard” or “compact”) at the expense of brand identification. In addition, some intermediaries have launched their own loyalty programs to develop loyalties to their reservation system rather than to our brands.
If the market value of the vehicles in our fleet is reduced or our ability to sell vehicles in the used vehicle marketplace were to become severely limited, we may have difficulty meeting collateral requirements under our asset-backed and asset-based financing arrangements, requiring us to either reduce the outstanding principal amount of debt or provide more collateral (in the form of cash, vehicles and/or certain other contractual rights) to the creditors under any such affected arrangement.
If the market value of the vehicles in our fleet is reduced or our ability to sell vehicles in the used vehicle marketplace were to become severely limited, we may have difficulty meeting collateral requirements under our asset-backed financing arrangements, requiring us to either reduce the outstanding principal amount of debt or provide more collateral (in the form of cash, vehicles and/or certain other contractual rights) to the creditors under any such affected arrangement.
The failure by a manufacturer to pay such amounts could cause a credit enhancement deficiency under our asset-backed and asset-based financing arrangements, requiring us to either reduce the outstanding principal amount of debt or provide more collateral (in the form of cash, vehicles and/or certain other contractual rights) to the creditors under any such affected arrangement.
The failure by a manufacturer to pay such amounts could cause a credit enhancement deficiency under our asset-backed financing arrangements, requiring us to either reduce the outstanding principal amount of debt or provide more collateral (in the form of cash, vehicles and/or certain other contractual rights) to the creditors under any such affected arrangement.
If one or more manufacturers were to adversely modify or eliminate repurchase or guaranteed depreciation programs in the future, our access to and the terms of our asset-backed and asset-based debt financing could be adversely affected, which could in turn have a material adverse effect on our results of operations, financial condition, liquidity and cash flows.
If one or more manufacturers were to adversely modify or eliminate repurchase or guaranteed depreciation programs in the future, our access to and the terms of our asset-backed debt financing could be adversely affected, which could in turn have a material adverse effect on our results of operations, financial condition, liquidity and cash flows.
Our vehicle purchase strategies have historically been and may in the future be affected by commercial, economic, market and other conditions, including a reduction of supply from auto manufacturers and any rebates or other incentives offered by them for our purchases.
Our vehicle purchase strategies have historically been and may in the future be affected by commercial, economic, market, seasonal and other conditions, including a reduction of supply from auto manufacturers and any rebates or other incentives offered by them for our purchases.
These types of disruptions could jeopardize our ability to fulfill existing contractual commitments or satisfy demand for our vehicles and could also result in the loss of business to competitors whose fleets are not similarly impacted.
These types of disruptions could jeopardize our ability to fulfill existing or future contractual commitments or satisfy demand for our vehicles and could also result in the loss of business to competitors whose fleets are not similarly impacted.
Recent or potential changes in laws or regulations that may affect us relate to insurance intermediaries, customer privacy, like-kind exchange programs, data security and rate regulation and our retail vehicle sales operations.
Recent or potential changes in laws or regulations that may affect us relate to insurance intermediaries, customer privacy, taxes, like-kind exchange programs, data security and rate regulation and our retail vehicle sales operations.
To the extent we do not react appropriately to our competition or optimize our revenue and pricing strategies to react to the actions of these competitors, we may experience sub-optimal pricing, sub-optimal asset utilization, poor customer satisfaction, lost revenue and other unfavorable consequences which may materially adversely affect our revenues and results of operations, financial condition, liquidity and cash flows. 25 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
To the extent we do not react appropriately to our competition or optimize our revenue and pricing strategies to react to the actions of these competitors, we may experience sub-optimal pricing, sub-optimal asset utilization, poor customer satisfaction, lost revenue and other unfavorable consequences which may materially adversely affect our revenues and results of operations, financial condition, liquidity and cash flows. 24 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
If there is a decline in residual values for non-program vehicles in our fleet and those residual values fail to improve, it may cause us to hold vehicles longer, sustain a substantial loss on the sale for such vehicles or require us to depreciate those vehicles at a more accelerated rate than currently anticipated while we own them.
If there is a decline in residual values for non-program vehicles in our fleet and those residual values fail to improve, it may cause us to hold vehicles longer, sustain a substantial loss on the sale for such vehicles or require us to depreciate those vehicles at a more accelerated rate than previously anticipated while we own them.
If we do not succeed in building and maintaining our talent pipeline through attracting and retaining qualified personnel, particularly at the management level, our ability to execute our business plan may be adversely affected, which could harm our operating results or financial condition.
If we do not succeed in building and maintaining our talent pipeline through attracting and retaining qualified personnel, particularly at the leadership level, our ability to execute our business plan may be adversely affected, which could harm our operating results or financial condition.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS Our business is subject to significant risks and uncertainties, and they should be carefully considered along with all of the information in this 2024 Annual Report.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS Our business is subject to significant risks and uncertainties, and they should be carefully considered along with all of the information in this 2025 Annual Report.
If we sustain substantial losses on sale of vehicles, depreciation is accelerated or our access to, or the terms of, our asset-backed and asset-based debt financing are adversely affected, it could have a material adverse effect on our results of operations, financial condition, liquidity and cash flows. 20 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
If we sustain substantial losses on sale of vehicles, depreciation is accelerated or our access to, or the terms of, our asset-backed debt financing are adversely affected, it could have a material adverse effect on our results of operations, financial condition, liquidity and cash flows. 19 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
The success of our business depends on our ability to hire and retain front-line employees, senior management and other key personnel in sufficient numbers and with the necessary skills to meet demand.
The success of our business depends on our ability to hire and retain front-line employees, senior leadership and other key personnel in sufficient numbers and with the necessary skills to meet demand.
There are a number of risks associated with our EV fleet, including, but not limited to, the following: • volatility in the pricing of new EVs by manufacturers, which can impact the residual values of EVs in our fleet; • demand for EVs, which may be impacted by customer sentiment regarding EVs overall, including with respect to the reliability and safety of EVs and access to charging infrastructure; • the frequency of damage and collision to EVs, which may be impacted by lack of familiarity with EVs by drivers; • our ability to successfully deploy EVs to ride share drivers; • costs associated with maintaining or repairing EVs and related infrastructure, which may remain elevated until the market for labor and parts for EV and EV infrastructure repair and maintenance matures; • our ability to attract, retain and train talent that is capable of managing an EV fleet; • risks related to the battery cells on which EVs depend, including the safety of such products and the associated need to maintain and significantly grow access to battery cells and raw materials; • risks related to the data connectivity and the technology upon which the success of these initiatives will rely, such as risks of unauthorized access to modify or use such technology; • uncertainty with respect to government regulations, as well as economic and tax incentives and conditions; • volatility resulting from the removal of certain EV-related tax incentives, which could negatively impact our vehicle costs; and • the possibility that our EVs are not as attractive to our customers, especially our ride share customers, as anticipated.
There are a number of risks associated with our EV fleet, including, but not limited to, the following: • volatility in the pricing of new EVs by manufacturers, which can impact the residual values of EVs in our fleet; • demand for EVs, which may be impacted by customer sentiment regarding EVs overall, including the reliability and safety of EVs and access to charging infrastructure; • the frequency of damage and collision to EVs, which may be impacted by the lack of familiarity with EVs by drivers; • our ability to successfully deploy EVs to ride share drivers; • costs associated with maintaining or repairing EVs and related infrastructure, which may remain elevated until the market for labor and parts for EV and EV infrastructure repair and maintenance matures; • our ability to attract, retain and train talent that is capable of managing an EV fleet; • risks related to the battery cells on which EVs depend, including the safety of such products and the associated need to maintain and significantly grow access to battery cells and raw materials; • risks related to the data connectivity and the technology upon which the success of these initiatives will rely, such as risks of unauthorized access to modify or use such technology; • uncertainty with respect to government regulations and economic conditions; and • the possibility that our EVs are not as attractive to our customers, especially our ride share customers, as anticipated.
Reports filed with or furnished to the SEC will be available as soon as reasonably practicable after they are filed with or furnished to the SEC. The information found on our website is not part of this 2024 Annual Report or any other report filed with or furnished to the SEC. 19 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Reports filed with or furnished to the SEC will be available as soon as reasonably practicable after they are filed with or furnished to the SEC. The information found on our website is not part of this 2025 Annual Report or any other report filed with or furnished to the SEC. 18 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Although we source EVs from a growing number of manufacturers, in the near term, we remain exposed to a number of risks related to the potential concentration of EV makes and models in our fleet, including the risk that a malfunction, recall or lack of availability of replacement parts or skilled labor for a particular EV make and model could have an outsized impact on our ability to offer EVs, or that demand from our customers for the particular EVs we acquire may be lower than we anticipate.
Although we source EVs from a growing number of manufacturers, in the near term, we remain exposed to a number of risks related to the potential concentration of EV makes and models in our fleet, including the risk that a malfunction, recall or lack of availability of replacement parts or skilled labor for a particular EV make and model could have an outsized impact on our ability to offer EVs, or that demand from our customers for the particular EVs may not be aligned with our current EV fleet.
Government and economic incentives – including certain tax exemptions, tax credits and rebates – that support the development and adoption of EVs in the U.S. and abroad may be reduced, eliminated, amended or exhausted from time to time.
Government and economic incentives — including certain tax exemptions, tax credits and rebates — that support the development and adoption of EVs may be reduced, eliminated, amended or exhausted from time to time.
These contracts are renegotiated periodically, and we anticipate renegotiating labor contracts with approximately 20% of these employees in 2025. Failure to negotiate a new labor agreement when required could result in a work stoppage.
These contracts are renegotiated periodically, and we anticipate renegotiating labor contracts with approximately 2% of these employees in 2026. Failure to negotiate a new labor agreement when required could result in a work stoppage.
RISK FACTORS (Continued) RISKS RELATED TO OUR BUSINESS Our vehicle rental business is particularly sensitive to reductions in the levels of business and leisure travel. The vehicle rental industry is particularly affected by changes in the demand for business and leisure travel, especially with respect to levels of airline passenger traffic.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) RISKS RELATED TO OUR BUSINESS Our vehicle rental business is particularly sensitive to reductions in the levels of business and leisure travel. The vehicle rental industry is particularly affected by changes in the demand for business and leisure travel, especially with respect to levels of airline passenger traffic.
BUSINESS (Continued) by which we advertise, the methods used to quote and charge prices, the consequences of failing to honor reservations, the terms on which we deal with vehicle loss or damage (including the protections we provide to renters purchasing loss or damage waivers) and the terms and method of sale of the optional insurance coverage that we offer.
The subjects of these regulations include the methods by which we advertise, the methods used to quote and charge prices, the consequences of failing to honor reservations, the terms on which we deal with vehicle loss or damage (including the protections we provide to renters purchasing loss or damage waivers) and the terms and method of sale of the optional insurance coverage that we offer.
If our fleet management systems are unable to accurately estimate future levels of rental activity and determine the appropriate mix of vehicles to purchase and maintain in our rental operations, the results may be obsolescence and excessive aging of fleet, the inability to sell fleet at adequate prices, sub-optimal fleet size and utilization, increased fleet costs, lower customer satisfaction, lost or missing fleet assets, reduced margins and cash flows and other unfavorable consequences, which may materially adversely affect our results of operations, financial condition, liquidity and cash flows. 23 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
If our fleet management systems are unable to accurately estimate future levels of rental activity and determine the appropriate mix of vehicles to purchase and maintain in our rental operations, the results may be obsolescence and excessive aging of fleet, the inability to sell fleet at adequate prices, sub-optimal fleet size and utilization, increased fleet costs, lower customer satisfaction, lost or missing fleet assets, reduced margins and cash flows and other unfavorable 22 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
If a large number of vehicles are the subject of a recall at one time, or if needed replacement parts or skilled labor are not in adequate supply, we may not be able to service all of our available demand for a significant period of time.
If a large number of vehicles are the subject of a recall at one time, if fixes for the underlying fault have not been developed by the OEMs, or if needed replacement parts or skilled labor are not in adequate supply, we may not be able to service all of our available demand for a significant period of time.
Vehicle residual values are variable and subject to market conditions, as well as seasonal fluctuations. If vehicle residual values decline, we may experience a greater risk of loss on vehicle sales, an increase in depreciation expense, a negative impact on our results of operations, and we may also experience challenges in meeting collateral requirements in our fleet financing facilities.
If vehicle residual values decline, we may experience a greater risk of loss on vehicle sales, an increase in depreciation expense, a negative impact on our results of operations, and we may also experience challenges in meeting collateral requirements in our fleet financing facilities.
We use program and non-program vehicles in our fleet. With program vehicles, vehicle manufacturers agree to repurchase the vehicles at a specified price or guarantee the depreciation rate on the vehicles during a specified time period.
We use program and non-program vehicles in our fleet. With program vehicles, vehicle manufacturers agree to repurchase the vehicles at a specified price or guarantee the depreciation rate on the vehicles during a specified time period. Using program vehicles in our fleet reduces our residual value risk and effectively provides fixed depreciation on those vehicles.
Cybersecurity incidents can also include fraud, phishing or other social engineering attempts or other methods to cause confidential information, payments, account access or access credentials, or other data to be transmitted to an unintended recipient. Cybersecurity threat actors also may attempt to exploit vulnerabilities in software including software commonly used by companies 27 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Cybersecurity incidents can also include fraud, phishing or other social engineering attempts or other methods to cause confidential information, payments, account access or access credentials, or other data to be transmitted to an unintended recipient. Cybersecurity threat actors also may attempt to exploit vulnerabilities in software including software commonly used by companies in cloud-based services and bundled software.
Depending on the severity of any recall, it could materially adversely affect, among other things, our revenues, create customer service problems, present liability claims, reduce the residual value of the recalled vehicles and harm our general reputation. 22 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
Depending on the severity of any recall, it could materially adversely affect, among other things, our revenues, create customer service problems, present liability claims, reduce the residual value of the recalled vehicles, impact our ability to return and the payment timing of certain program vehicles, and harm our general reputation. 21 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Based on information currently available, we believe that the ultimate resolution of existing environmental remediation actions and our compliance in general with environmental 18 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1. BUSINESS (Continued) laws and regulations will not have a material effect on our operating results or financial condition.
Based on information currently available, we believe that the ultimate resolution of existing environmental remediation actions and our compliance in general with environmental laws and regulations will not have a material effect on our operating results or financial condition.
Manufacturer safety recalls could require costly and time-consuming repairs to our fleet. The Raechel and Jacqueline Houck Safe Rental Car Act of 2015 prohibits us from renting or selling vehicles with open federal safety recalls and requires us to repair or address these recalls.
Manufacturer safety recalls could require costly and time-consuming repairs to our fleet. The Raechel and Jacqueline Houck Safe Rental Car Act of 2015 prohibits a rental car company from renting or selling vehicles with open federal safety recalls until the underlying fault is remedied.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) Our EV fleet exposes us to a number of risks. We had previously emphasized an EV strategy that was focused on electrification and advancing mobility.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) consequences, which may materially adversely affect our results of operations, financial condition, liquidity and cash flows. Our EV fleet exposes us to a number of risks. We had previously emphasized an EV strategy that was focused on electrification and advancing mobility.
Such a regime could, however, be quickly imposed if there was a serious disruption in supply for any reason, including an act of war, terrorist incident or other problem affecting petroleum or energy supply, petroleum refining or energy distribution or pricing.
Such a regime could, however, be quickly imposed if 17 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1. BUSINESS (Continued) there was a serious disruption in supply for any reason, including an act of war, terrorist incident or other problem affecting petroleum or energy supply, petroleum refining or energy distribution or pricing.
Depending on the jurisdiction, those changes may come about through new legislation, the passage of new laws and regulations or changes in the interpretation of existing laws, regulations and treaties by a court, regulatory body or governmental official.
Changes in Government Regulations Changes in government regulation of our businesses have the potential to materially alter our business practices or our profitability. Depending on the jurisdiction, those changes may come about through the passage of new laws and regulations or changes in the interpretation of existing laws, regulations and treaties by a court, regulatory body or governmental official.
We encounter continuous risk of exposure to cybersecurity attacks, cybersecurity incidents, and other cybersecurity threats to our information networks and systems, as well as those of our third-party service providers, and the information stored on those networks and systems.
We encounter continuous risk of exposure to cybersecurity attacks, cybersecurity incidents, and other cybersecurity threats to our information networks and systems, as well as those of our third-party service providers, and the 26 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) information stored on those networks and systems.
The price of new cars and their components may be impacted by tariffs. We cannot predict what further action may be taken with respect to tariffs or trade relations between the U.S. and other governments.
The price of new cars and their components may be impacted by tariffs. We cannot predict what further action may be taken with respect to tariffs or trade relations between the U.S. and other governments. The Trump Administration has imposed and significantly increased tariffs on foreign imports into the U.S., particularly from Canada, China and Mexico.
In addition, recent inflationary trends overall have driven market pressure for increased wages, and declines in our share price have impacted the retention value of existing equity awards.
Changing employee expectations about remote work and workplace flexibility complicate our employee recruiting, retention and talent management strategies. In addition, recent inflationary trends overall have driven market pressure for increased wages, and declines in our share price have impacted the retention value of existing equity awards.
If we are unable to sell vehicles at our preferred times and through our preferred channels, it may adversely affect our results of operations, financial condition, liquidity and cash flows. Our vehicle carrying costs, customer service scores and ability to dispose of vehicles at acceptable prices and times may be negatively impacted if we lengthen the age of our fleet.
Our vehicle carrying costs, customer service scores and ability to dispose of vehicles at acceptable prices and times may be negatively impacted if we lengthen the age of our fleet.
In addition, the global supply chain can be impacted by logistics provider capacity issues, inflationary pressures, increased freight costs, depleted inventory levels, labor shortages and demand peaks.
In response, many foreign countries have implemented or increased tariffs on imports into their countries. These tariff increases can adversely impact the global automotive supply chain. In addition, the global supply chain can be impacted by logistics provider capacity issues, inflationary pressures, increased freight costs, depleted inventory levels, labor shortages and demand peaks.
We strive to maintain competitive compensation and benefits, employee development and retention programs and build an inclusive culture. Competition for qualified employees is intense, particularly with respect to technology roles that are critical to our strategic and information technology initiatives. Changing employee expectations about remote work and workplace flexibility complicate our employee recruiting, retention and talent management strategies.
In addition, we conduct annual benchmarking for the executive pay for our key senior positions. We strive to maintain competitive compensation and benefits, employee development and retention programs and build an inclusive culture. Competition for qualified employees is intense, particularly with respect to technology roles that are critical to our strategic and information technology initiatives.
In recent years, the average age of our fleet has become older and the percentage of pre-owned vehicles in our fleet has grown, both as a result of a variety of factors, including greater customer acceptance of higher mileage vehicles, our strategic revenue initiatives (such as ride share and reinvigoration of our value brands) and choices that we make in light of residual value dynamics at any given time.
We have at times in recent years increased, and from time to time may increase, the percentage of pre-owned vehicles in our fleet, which could be influenced by a variety of factors, including reduced new vehicle OEM offerings, supply chain constraints, capital constraints, greater customer acceptance of higher mileage vehicles, our strategic revenue initiatives (such as ride share and reinvigoration of our value brands) and choices that we make in light of residual value dynamics at any given time.
Negative claims or publicity regarding, among other things, our Company or our operations, offerings, practices or customer service may damage our brands or reputation, even if such claims are untrue.
Negative claims or publicity regarding, among other things, our 25 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) Company or our operations, offerings, practices or customer service may damage our brands or reputation, even if such claims are untrue.
Disruption in that supply chain may adversely affect our ability to service demand, or to do so efficiently. Our supply chain, particularly with respect to access to new vehicles, is complex and reliant on raw goods and finished materials that are obtained from or manufactured by many different market participants, both within and outside the U.S.
Our supply chain, particularly with respect to access to new vehicles, is complex and reliant on raw goods and finished materials that are obtained from or manufactured by many different market participants, both within and 20 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) outside the U.S.
In addition, if the costs of these leases and/or concession agreements increase and we are unable to increase our pricing structure to offset the increased costs, our results of operations, financial condition, liquidity and cash flows could be adversely affected. Maintaining favorable brand recognition is essential to our success and failure to do so could materially adversely affect our business.
In addition, if the costs of these leases and/or concession agreements increase and we are unable to increase our pricing structure to offset the increased costs, our results of operations, financial condition, liquidity and cash flows could be adversely affected. Additionally, increased competition from peer-to-peer vehicle rental operators may impact market share and revenue.
Governments in the U.S., United Kingdom and European Union have each imposed export controls on certain products and financial and economic sanctions on certain industry sectors and parties in Russia.
The global automotive supply chain has been negatively impacted by the military conflicts between Russia and Ukraine, and in the Middle East. Governments in the U.S., U.K. and European Union have each imposed export controls on certain products and financial and economic sanctions on certain industry sectors and parties in Russia.
Additionally, program vehicles provide flexibility because we may be able to sell certain program vehicles shortly after having acquired them at a higher value than what we could for a similar non-program vehicle at that time, which is useful in managing demand for vehicles.
Additionally, program vehicles provide flexibility because we may be able to sell certain program vehicles at a higher value during certain time periods than what we could for a similar non-program vehicle, enabling us to better manage our vehicle supply for our peak rental demand periods.
We derive significant revenues from key leisure destinations, including California, Florida, Hawaii, New York and Texas in the U.S. and major cities in Europe.
In addition to the impact of broad-based travel trends, our results of operations and financial condition are also impacted by regional and local trends. We derive significant revenues from key leisure destinations, including California, Florida, Hawaii, New York and Texas in the U.S. and major cities in Europe.
Decreases in residual values of our non-program vehicles, or the failure of residual values to follow historical patterns, could result in a substantial loss on the sale of such vehicles, or accelerated depreciation while we own the vehicles. Each of these outcomes can materially adversely affect our results of operations, financial condition, liquidity and cash flows.
Overall, the percentage of our non-program fleet that we hold exposes us to residual value risk. Decreases in residual values of our non-program vehicles, or the failure of residual values to follow historical patterns, could result in a substantial loss on the sale of such vehicles, or accelerated depreciation while we own the vehicles.
These benefits diminish when there are fewer program vehicles in our fleet, which has generally been the case in recent years. The significant majority of vehicles in our fleet are non-program vehicles. Overall, the percentage of our non-program fleet that we hold exposes us to residual value risk.
These benefits diminish when there are fewer program vehicles in our fleet, which had generally been the case in recent years, but is improving. There can be no guarantee that we will be able to obtain the right mix of program and non-program vehicles in our fleet. The significant majority of vehicles in our fleet are non-program vehicles.
However, aged vehicles present additional risks to our operations, including the risk of higher maintenance costs while in the fleet and lower customer satisfaction scores. In addition, it may be more difficult for us to sell highly aged vehicles at reasonable prices, or through our preferred retail channels, or at the time that we prefer.
However, aged vehicles present additional risks to our operations, including risk of higher depreciation costs, risk of higher maintenance costs while in the fleet and lower customer satisfaction scores.
Any decline in perceived favorable recognition of our brands or damage to our reputation could materially adversely affect our results of operations, financial condition, liquidity and cash flows. 26 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
Any decline in perceived favorable recognition of our brands or damage to our reputation could materially adversely affect our results of operations, financial condition, liquidity and cash flows. RISK RELATED TO OUR EMPLOYEES The ability to attract and retain front-line employees, senior leadership and other key personnel is critical to the success of our business.
For example, previously available incentives favoring EVs in certain areas have expired, were cancelled or have temporarily become unavailable; in some cases, these incentives have not been replaced or reinstituted. 24 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
For example, previously available incentives favoring EVs in certain areas have expired, were cancelled or have temporarily become unavailable; in some cases, these incentives have not been replaced or reinstituted. The U.S., in particular, eliminated EV credits with the enactment of the One Big Beautiful Bill Act ("OBBBA") on July 4, 2025.
Our inability to rotate aged vehicles for newer vehicles may have an adverse effect on our results of operations, financial condition, liquidity and cash flows. Our business, results of operations and financial condition are dependent on the efficient operation of a complex global supply chain.
Our business, results of operations and financial condition are dependent on the efficient operation of a complex global supply chain. Disruption in that supply chain may adversely affect our ability to service demand, or to do so efficiently.
RISK FACTORS (Continued) In December 2023, we made the decision to significantly reduce the size of our global EV fleet and initiated EV vehicle dispositions, which took place over the course of 2024.
RISK FACTORS (Continued) Since our decision to significantly reduce the size of our global EV fleet and corresponding EV dispositions, the EV fleet represents less than 10% of our U.S. operating fleet.
Resurgence of the COVID-19 virus or variants thereof, or other global or regional health crises, could have similar impacts. In addition to the impact of broad-based travel trends, our results of operations and financial condition are also impacted by regional and local trends.
If a similar global or regional health crisis were to occur, or reoccur in the case of COVID-19 or variants thereof, business and leisure travel may be negatively impacted which may adversely impact our results of operations, financial condition, liquidity and cash flows.
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Changes in Government Regulations Changes in government regulation of our businesses have the potential to materially alter our business practices or our profitability.
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ITEM 1. BUSINESS (Continued) cybersecurity insurance, all from unaffiliated insurance companies in amounts we deem to be adequate in light of the respective hazards, where such coverage is obtainable on commercially reasonable terms.
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Using program vehicles in our fleet can often alleviate our residual value risk because of the terms of our agreements with the vehicle manufacturer for repurchases and guaranteed depreciation on those vehicles.
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GOVERNMENT REGULATION AND ENVIRONMENTAL MATTERS We are subject to numerous types of governmental controls, including those relating to prices and advertising, privacy and data protection, currency controls, labor matters, credit and charge card operations, insurance, environmental protection, used vehicle sales and licensing.
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Used vehicle prices are subject to overall market conditions and seasonal fluctuations.
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Dealings with Customers In the U.S., vehicle rental transactions are generally subject to Article 2A of the Uniform Commercial Code, which governs leases of tangible personal property. Vehicle rental is also specifically regulated in more than half of the states of the U.S. and many other international jurisdictions.
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The global automotive supply chain has been negatively impacted by the military conflicts between 21 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) Russia and Ukraine, and in the Middle East.
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Each of these outcomes can materially adversely affect our results of operations, financial condition, liquidity and cash flows. Vehicle residual values are variable and subject to market conditions, as well as seasonal fluctuations.
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The new U.S. presidential administration has proposed to increase significantly tariffs on foreign imports into the U.S., particularly from Canada, China and Mexico, and these tariff increases can adversely impact the global automotive supply chain.
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If we are unable to sell vehicles at our preferred times and through our preferred channels, or at all, it may adversely affect our results of operations, financial condition, liquidity and cash flows.
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In addition, some intermediaries have launched their own loyalty programs to develop loyalties to their reservation system rather than to our brands.
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In addition, it may be more difficult for us to sell highly aged vehicles at reasonable prices, or through our preferred retail channels, or at all, or at the time that we prefer. Our inability to rotate aged vehicles for newer vehicles may have an adverse effect on our results of operations, financial condition, liquidity and cash flows.
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RISK FACTORS (Continued) RISK RELATED TO OUR EMPLOYEES The ability to attract and retain front-line employees, senior management and other key personnel is critical to the success of our business.
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Expiration of federal tax credits and related incentives favoring EVs may impact vehicle acquisition costs, residual values, fleet composition strategies and overall customer demand for EVs. 23 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
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These third-party channels may be influenced by changes in technology including developments in artificial intelligence. If our customers develop loyalty to internet travel intermediaries rather than our brands, our business and revenues could be adversely affected.
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At many airports locations, peer-to-peer operators have operational and financial advantages over incumbent vehicle rental operators due to lower financial obligations and more convenient access to vehicles. Airports are having difficulty executing agreements with peer-to-peer operators that achieve parity with existing vehicle rental operators, and enforcement of these agreements remains a challenge with the airports.
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By peer-to-peer vehicle rental operators not being held to the same financial and operational standards at the airports as well as offering customers operational advantages, peer-to-peer operators may have an impact on financial results and overall market share. Maintaining favorable brand recognition is essential to our success and failure to do so could materially adversely affect our business.
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Like many other companies, we detect attempts by threat actors to gain access to our systems and networks on a frequent basis, and the frequency of such attempts could increase in the future.
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At this time, we do not have any indication that any risks from cybersecurity threats have had, or are reasonably likely to have, a material effect on our business strategy, results of operations or financial condition.
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We have invested in the protection of data and information technology, and actively work to enhance our business continuity and disaster recovery capabilities; however, there can be no assurance that our efforts will be successful. We monitor our obligations under and compliance with global laws requiring information security safeguards and potential notification requirements in the event of a cybersecurity incident.
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We maintain procedures for detecting, communicating and addressing cybersecurity incidents. We have also taken steps to assess cybersecurity of third- party business partners, including service providers, licensees and franchisees, that handle, possess, process and store our material information. We require these third parties to maintain certain security controls.
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However, because of the rapidly changing nature and sophistication of cybersecurity threats, which can be difficult to detect, there can be no guarantee that our controls, policies and procedures have detected or prevented or will detect or prevent all of these cybersecurity threats, and we cannot predict the full impact of any past or future cybersecurity incident.
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A cybersecurity incident relating to our information or systems or that of our third-party business partners, or any failure by us or our third-party business partners to effectively address, enforce and maintain our information technology infrastructure and cybersecurity requirements may result in substantial harm to our business strategy, results of operations and financial condition, including major disruptions to business operations, loss of intellectual property, release of confidential information, alteration or corruption of data or systems, costs related to remediation or the payment of ransom and litigation, including individual claims or consumer class actions, commercial litigation, administrative, and civil or criminal investigations or actions, regulatory intervention and sanctions or fines, investigation and remediation costs, and possible prolonged negative publicity.
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We have experienced in the past, and may experience in the future, cybersecurity incidents that have resulted in threat actors obtaining personal information of our customers. Our customers’ information, including their loyalty account login information, can be a target for cyber criminals.
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Given that customers may share common credentials across multiple sites, a compromise of one site can provide cyber criminals the means to compromise customer accounts of other merchants and any customer information contained therein.
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Although we maintain a cyber insurance policy, there is no guarantee that such coverage will be sufficient to address costs, liabilities and damages we may incur in connection with a cybersecurity incident or that such coverage will continue to be available on commercially reasonable terms or at all.
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Our business is heavily reliant upon information technology systems, some of which are managed, hosted, provided or used by third parties and any significant failures or disruptions to these systems could adversely impact our business.
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Our ability to, among other things, accept reservations, process rental and sales transactions, manage our pricing, manage our revenue earning vehicles, manage our financing arrangements, account for our activities and otherwise conduct our business depends on the performance and availability of our networks and systems, as well as those of third-party providers and other business partners.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe effects of these risks may, individually or in the aggregate, materially adversely affect our results of operations, financial condition, liquidity and cash flows. The disposition of revenue earning vehicles may result in taxable income, which might not be fully offset by the taxable expense associated with newly purchased revenue earning vehicles.
Biggest changeAND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) The effects of these risks may, individually or in the aggregate, materially adversely affect our results of operations, financial condition, liquidity and cash flows.
Our asset-backed and asset-based financing capacity could be decreased, our financing costs and interest rates could be increased, or our future access to the financial markets could be limited, as a result of risks and contingencies, many of which are beyond our control, including: (i) the acceptance by and/or demand from credit markets of the structures and structural risks associated with our asset-backed and asset-based financing arrangements; (ii) the credit ratings provided by credit rating agencies for our asset-backed indebtedness; (iii) third parties requiring changes in the terms and structure of our asset-backed or asset-based financing arrangements, including increased credit enhancement or required cash collateral and/or other liquid reserves; (iv) the insolvency or deterioration of the financial condition of one or more of our principal vehicle manufacturers; (v) changes in laws or regulations that negatively affect any of our asset-backed or asset-based financing arrangements; or (vi) the overall credit condition of Hertz.
Our asset-backed financing capacity could be decreased, our financing costs and interest rates could be increased, or our future access to the financial markets could be limited, as a result of risks and contingencies, many of which are beyond our control, including: (i) the acceptance by and/or demand from credit markets of the structures and structural risks associated with our asset-backed financing arrangements; (ii) the credit ratings provided by credit rating agencies for our asset-backed indebtedness; (iii) third parties requiring changes in the terms and structure of our asset-backed financing arrangements, including increased credit enhancement or required cash collateral and/or other liquid reserves; (iv) the insolvency or deterioration of the financial condition of one or more of our principal vehicle manufacturers; (v) changes in laws or regulations that negatively affect any of our asset-backed financing arrangements; or (vi) the overall credit condition of Hertz.
If we are unable to refinance or replace our existing asset-backed and asset-based financing or continue to finance new vehicle acquisitions through asset-backed or asset-based financing on favorable terms, on a timely basis, or at all, then our costs of financing could increase significantly and have a material adverse effect on our liquidity, interest costs, financial condition, cash flows and results of operations, including, more broadly, the financial performance of the Company.
If we are unable to refinance or replace our existing asset-backed financing or continue to finance new vehicle acquisitions through asset-backed financing on favorable terms, on a timely basis, or at all, then our costs of financing could increase significantly and have a material adverse effect on our liquidity, interest costs, financial condition, cash flows and results of operations, including, more broadly, the financial performance of the Company.
Any disruption, termination or substandard provision of services, including by third-party cloud providers or other business partners, whether as the result of localized conditions (e.g., fire or explosion), failure of our systems to function as designed, as the result of a cybersecurity incident, technology vulnerability or malfunction, or as the result of events or circumstances of broader geographic impact (e.g., earthquake, storm, flood, epidemic, strike, act of war, civil unrest or terrorist act), could materially adversely affect our business by disrupting normal reservations, customer service, accounting and technology functions; interfering with our ability to manage our vehicles; delaying or disrupting rental and sales processes; adversely affecting our ability to comply with our financing arrangements; and otherwise impacting our ability to manage our business.
Any disruption, termination or substandard provision of services, including by third-party providers or other business partners, whether as the result of outages, localized conditions (e.g., fire or explosion), failure of systems to function as designed, as the result of a cybersecurity incident, technology vulnerability or malfunction, or as the result of events or circumstances of broader geographic impact (e.g., earthquake, storm, flood, epidemic, strike, act of war, civil unrest or terrorist act), could materially adversely affect our business by disrupting normal reservations, customer service, accounting and technology functions; interfering with our ability to manage our vehicles; delaying or disrupting rental and sales processes; adversely affecting our ability to comply with our financing arrangements; and otherwise impacting our ability to manage our business.
In the ordinary course of our business, we take steps to evaluate, maintain, upgrade and consolidate our information technology systems, including by making changes to legacy systems, replacing legacy systems with successor systems with new functionality, outsourcing certain systems and acquiring new systems with new functionality. We deploy significant capital expenditures in connection with these activities.
In the ordinary course of our business, we take steps to evaluate, maintain, upgrade, update, and consolidate our information technology systems, including by making changes to legacy systems, replacing legacy systems with successor systems with new functionality, outsourcing certain systems and acquiring new systems with new functionality. We deploy significant capital expenditures in connection with these activities.
Substantially all of our consolidated assets are subject to security interests or are otherwise encumbered for the benefit of our creditors. The bulk of our consolidated assets consists of our revenue earning vehicles and certain related vehicle assets and are subject to security interests or are otherwise encumbered for the benefit of our asset-backed and asset-based financing arrangements.
Substantially all of our consolidated assets are subject to security interests or are otherwise encumbered for the benefit of our creditors. The bulk of our consolidated assets consists of our revenue earning vehicles and certain related vehicle assets and are subject to security interests or are otherwise encumbered for the benefit of our asset-backed financing arrangements.
If our business continuity management plan fails to operate as intended, we may experience significant business disruptions, release of confidential information, malicious corruption of data, regulatory intervention and sanctions, prolonged negative publicity, litigation and liabilities, product and service quality failures, irreparable harm to customer relationships and other unfavorable consequences which may materially adversely affect our results of operations, financial condition, liquidity and cash flows. 39 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
If our business continuity management plan fails to operate as intended, we may experience significant business disruptions, release of confidential information, malicious corruption of data, regulatory intervention and sanctions, prolonged negative publicity, litigation and liabilities, product and service quality failures, irreparable harm to customer relationships and other unfavorable consequences which may materially adversely affect our results of operations, financial condition, liquidity and cash flows. 38 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
The significant ownership interests held by our Plan Sponsors, which, as of December 31, 2024, exceeded 50% of our outstanding common stock (without taking into account the dilutive impact of outstanding Public Warrants or Exchangeable Notes) means that the Plan Sponsors have the ability to control matters requiring stockholder approval, such as director elections, amendments to the Hertz Holdings Certificate of Incorporation and significant corporate transactions.
The significant ownership interests held by our Plan Sponsors, which, as of December 31, 2025, exceeded 50% of our outstanding common stock (without taking into account the dilutive impact of outstanding Public Warrants or the Exchangeable Notes) means that the Plan Sponsors have the ability to control matters requiring stockholder approval, such as director elections, amendments to the Hertz Holdings Certificate of Incorporation and significant corporate transactions.
There can be no assurance that we will not be exposed to uninsured liability at levels in excess of our historical levels, that liabilities in respect of existing or future claims will not exceed the level of our insurance or reserves, that we will have sufficient capital available to pay any uninsured claims or that insurance with unaffiliated carriers will continue to be available to us on economically reasonable terms or at all.
There can be no assurance that we will not be exposed to uninsured liability at levels in excess of our historical levels, that liabilities relating to existing or future claims will not exceed the level of our insurance or reserves, that we will have sufficient capital available to pay any uninsured claims or that insurance with unaffiliated carriers will continue to be available to us on economically reasonable terms or at all.
Compliance with existing or future environmental laws and regulations may require material expenditures by us or otherwise have a material adverse effect on our consolidated financial condition, results of operations, liquidity or cash flows. See Item 1, ‘‘Business—Government Regulation and Environmental Matters’’ in this 2024 Annual Report.
Compliance with existing or future environmental laws and regulations may require material expenditures by us or otherwise have a material adverse effect on our consolidated financial condition, results of operations, liquidity or cash flows. See Item 1, ‘‘Business—Government Regulation and Environmental Matters’’ in this 2025 Annual Report.
We are subject to many forms of taxation in the jurisdictions throughout the world in which we operate, including, but not limited to, income tax, withholding tax, indirect tax, value-added tax, premium tax and payroll-related taxes. Tax law and administration are extremely complex and often require us to make subjective determinations.
We are subject to many forms of taxation in the jurisdictions throughout the world in which we operate, including, but not limited to, income tax, withholding tax, indirect tax, value-added tax, registration tax, road tax, premium tax and payroll-related taxes. Tax law and administration are extremely complex and often require us to make subjective determinations.
For details of our annual impairment testing, see Note 6, "Goodwill and Intangible Assets, Net," in Part II, Item 8 of this 2024 Annual Report. Changes in management’s estimates and assumptions could have a material impact to our results of operations, financial condition, liquidity and cash flows.
For details of our annual impairment testing, see Note 6, "Goodwill and Intangible Assets, Net," in Part II, Item 8 of this 2025 Annual Report. Changes in management’s estimates and assumptions could have a material impact to our results of operations, financial condition, liquidity and cash flows.
Operating in the U.S. and in many different countries exposes us to varying risks, which include: (i) multiple, and sometimes conflicting, U.S. and foreign regulatory requirements and laws that are subject to change, including but not limited to, laws relating to income and other direct or indirect taxes, including corporate alternative minimum taxes, automobile-related liability, insurance rates, insurance products, consumer privacy, data security, employment matters, cost and fee recovery, and the protection of our trademarks and other intellectual property; (ii) the effect of foreign currency translation risk, as well as limitations on our ability to repatriate income; (iii) varying tax regimes, including consequences from changes in applicable tax laws and our ability to repatriate cash from non-U.S. affiliates without adverse tax consequences; (iv) foreign country ownership or investment requirements, as well as difficulties in obtaining financing in foreign countries for local operations; (v) changes in the proportion of revenue between the U.S. and foreign countries with varying tax rates or imposition of global minimum tax rates; and (vi) political and economic instability, natural calamities, civil unrest, war, terrorism and other hostilities.
Operating in the U.S. and in many different countries exposes us to varying risks, which include: (i) multiple, and sometimes conflicting, U.S. and foreign regulatory requirements and laws that are subject to change, including but not limited to, laws relating to income and other direct or indirect taxes, including corporate alternative minimum taxes, automobile-related liability, insurance rates, insurance products, consumer privacy, data security, employment matters, cost and fee recovery, and the protection of our trademarks and other intellectual property; (ii) the effect of foreign currency translation risk, as well as limitations on our ability to repatriate income; (iii) varying tax regimes, including consequences from changes in applicable tax laws and our ability to repatriate cash from non-U.S. affiliates without adverse tax consequences; (iv) foreign country ownership or investment requirements, as well as difficulties in obtaining financing in foreign countries for local operations; (v) changes in the proportion of revenue between the U.S. and foreign countries with varying tax rates or imposition of global minimum tax rates; and (vi) political and economic instability, natural calamities, civil unrest, war, terrorism and other hostilities. 29 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Although we have made progress to reduce the number of aged systems, such risks are elevated when legacy systems and infrastructure updates are delayed or otherwise not made on a timely basis, which can result in a heightened security risk.
Although we have made progress to reduce the number of aged systems, such risks are elevated when legacy systems and infrastructure updates are delayed or otherwise not made on a timely basis, which can result in a heightened security and/or business continuity risk.
In the event that we cannot post additional collateral, the principal under our asset-backed and certain asset-based financing arrangements may be required to be repaid sooner than anticipated with vehicle disposition proceeds and lease payments we make to our special-purpose financing subsidiaries.
In the event that we cannot post additional collateral, the principal under our asset-backed financing arrangements may be required to be repaid sooner than anticipated with vehicle disposition proceeds and lease payments we make to our special-purpose financing subsidiaries.
If share repurchases are conducted, the excise tax will increase the cost of such share repurchases. 37 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) The share price of our common stock may be volatile.
If share repurchases are conducted, the excise tax will increase the cost of such share repurchases. 36 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) The share price of our common stock may be volatile.
A material disposition could require the amendment or refinancing of our outstanding indebtedness or a portion thereof. 40 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1B. UNRESOLVED STAFF COMMENTS None.
A material disposition could require the amendment or refinancing of our outstanding indebtedness or a portion thereof. 39 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Similarly, if the demand for used vehicles were to decline, resulting in sales of vehicles below the net book value required by our asset-backed and certain asset-based financings, we may have difficulty meeting the minimum required collateral levels resulting in a contractual obligation to add additional collateral in the form of cash or additional vehicles to the under collateralized asset-backed and/or certain asset-based financing.
Similarly, if the demand for used vehicles were to decline, resulting in sales of vehicles below the net book value required by our asset-backed financings, we may have difficulty meeting the minimum required collateral levels resulting in a contractual obligation to add additional collateral in the form of cash or additional vehicles to the under collateralized asset-backed financing.
Additionally, if our AI applications are based on data, algorithms or other inputs that are flawed, or if our AI applications assist us in producing content, analyses or recommendations that are, or are alleged to be, deficient, inaccurate or biased, our business, results of operations and financial conditions may be adversely affected.
Additionally, if our AI applications, or the AI applications of third parties, are based on data, algorithms or other inputs that are flawed, or if our AI applications, or the AI applications of third parties, assist us in producing content, analyses or recommendations that are, or are alleged to be, deficient, inaccurate or biased, our business, results of operations and financial conditions may be adversely affected.
For further discussion regarding how changes in the regulation of insurance intermediaries may affect us, see Item 1, ‘‘Business—Insurance and Risk Management’’ in this 2024 Annual Report.
For further discussion regarding how changes in the regulation of insurance intermediaries may affect us, see Item 1, ‘‘Business—Insurance and Risk Management’’ in this 2025 Annual Report.
Our reliance on asset-backed and asset-based financing arrangements to purchase vehicles subjects us to a number of risks, many of which are beyond our control. We rely significantly on asset-backed and asset-based financing to purchase vehicles.
Our reliance on asset-backed financing arrangements to purchase vehicles subjects us to a number of risks, many of which are beyond our control. We rely significantly on asset-backed financing to purchase vehicles.
See Item 1, “Business - Insurance and Risk Management” and Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2024 Annual Report.
See Item 1, “Business—Insurance and Risk Management” and Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2025 Annual Report.
Provisions in the Hertz Holdings Certificate of Incorporation and Bylaws may have the effect of delaying or preventing a change of control or changes in our management, including, generally, provisions that: • do not provide cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; • provide for a classified Board with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of the Board; • allow for removal of directors only for cause; • allow only the Board to fill a vacancy created by the expansion of the Board or the resignation, death, retirement, disqualification or removal of a director; • require advance notice for stockholder proposals to be brought before a meeting of stockholders, including proposed nominations of persons for election to the Board; • only allow stockholder action to be taken at an annual or special meeting; • limit the ability of stockholders to call a special meeting; and • authorize blank check preferred stock. 38 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Provisions in the Hertz Holdings Certificate of Incorporation and Bylaws may have the effect of delaying or preventing a change of control or changes in our management, including, generally, provisions that: • do not provide cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; • provide for a classified Board with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of the Board; • allow for removal of directors only for cause; • allow only the Board to fill a vacancy created by the expansion of the Board or the resignation, death, retirement, disqualification or removal of a director; • require advance notice for stockholder proposals to be brought before a meeting of stockholders, including proposed nominations of persons for election to the Board; • only allow stockholder action to be taken at an annual or special meeting; 37 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
We may incorporate AI solutions into our business, and we may leverage AI, including generative AI, into our business operations. Our competitors or other third parties may incorporate AI into their products more quickly or more successfully than we do, which could impair our ability to compete effectively and could adversely affect our results of operations.
We may incorporate AI solutions into our business, and we may leverage AI, including generative AI, into our business operations. Our competitors or other third parties, like third-party distribution channels, may incorporate AI into their products more quickly or more successfully than we do, which could impair our ability to compete effectively and could adversely affect our results of operations.
These risks include those described or referred to in this “Risk Factors” section and in the other documents incorporated herein by reference as well as, among other things: • our operating and financial performance and prospects; • our successful execution of our business strategy, including with respect to our ongoing fleet rotation; • sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares of common stock intend to sell; • our ability to repay our debt; • adverse market reactions to any additional debt we incur in the future; • our credit ratings; • our access to financial and capital markets to refinance our debt or replace the existing credit facilities; • investor perceptions of us and the industry and markets in which we operate; • our dividend policy; • future sales of equity or equity-related securities; • announcements and actions filed by third parties of significant claims or proceedings against us; • issuances of new or updated research reports by security or industry analysts, or those analysts not publishing or ceasing to publish reports about us, our industry or our market; • speculative trading activities by third parties, driven by, among other things, social media coverage; • changes in, or results that vary from, earnings estimates or buy/sell recommendations by analysts; • additions or departures of key management personnel; and • general financial, domestic, economic and other market conditions.
These risks include those described or referred to in this “Risk Factors” section and in the other documents incorporated herein by reference as well as, among other things: • our operating and financial performance and prospects; • our successful execution of our business strategy, including with respect to our ongoing fleet rotation; • sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares of common stock intend to sell; • our ability to repay our debt; • adverse market reactions to any additional debt we incur in the future; • our credit ratings; • our access to financial and capital markets to refinance our debt or replace the existing credit facilities; • investor perceptions of us and the industry and markets in which we operate; • our dividend policy; • future sales of equity or equity-related securities; • the capped call transactions that we entered into, and the swap transactions that a third party entered into in connection with the issuance of our Exchangeable Notes Due 2030 in September 2025; • announcements and actions filed by third parties of significant claims or proceedings against us; • issuances of new or updated research reports by security or industry analysts, or those analysts not publishing or ceasing to publish reports about us, our industry or our market; • speculative trading activities by third parties, driven by, among other things, social media coverage; • changes in, or results that vary from, earnings estimates or buy/sell recommendations by analysts; • additions or departures of key management personnel; and • general financial, domestic, economic and other market conditions.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) Failure by us to have proper financing and debt management processes in place may result in cash shortfalls and liquidity problems, the need to seek emergency financing at high interest rates, violations of debt covenants and an inability to execute strategic initiatives.
RISK FACTORS (Continued) Failure by us to have proper financing and debt management processes in place may result in cash shortfalls and liquidity problems, the need to seek emergency financing at high interest rates, violations of debt covenants and an inability to execute strategic initiatives.
If that event were to occur (or any other liquidation events), the holders of our asset-backed and certain asset-based debt may have the ability to exercise their right to, directly or indirectly, foreclose on and sell vehicles to generate proceeds sufficient to repay such debt. 36 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
If that event were to occur (or any other liquidation events), the holders of our asset-backed debt may have the ability to exercise their right to, directly or indirectly, foreclose on and sell vehicles to generate proceeds sufficient to repay such debt. 35 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
Unauthorized parties may also attempt to gain access to our facilities or systems, or those of third parties with whom we do business, through fraud, misrepresentation, or other forms of deception or attack.
Unauthorized parties have in the past, and may in the future, also attempt to gain access to our facilities or systems, or those of third parties with whom we do business, through fraud, misrepresentation, or other forms of deception or attack.
If a leak or a spill occurs, it is possible that the costs to investigate and remediate resulting impacts, as well as any associated fines, litigation or reputational harm could be significant. Historically, we have indemnified property owners for the costs associated with remediating certain hazardous substance storage, recycling or disposal sites and, in some instances, for natural resource damages.
RISK FACTORS (Continued) investigate and remediate resulting impacts, as well as any associated fines, litigation or reputational harm could be significant. Historically, we have indemnified property owners for the costs associated with remediating certain hazardous substance storage, recycling or disposal sites and, in some instances, for natural resource damages.
Our asset-backed and certain asset-based vehicle financing facilities include credit enhancement provisions that require us to provide cash or additional vehicle collateral in the event the estimated market values for the vehicles used as collateral decreases below net book values.
Our asset-backed vehicle financing facilities include credit enhancement provisions that require us to provide cash or additional vehicle collateral in the event the estimated market values for the vehicles used as collateral decreases below net book values. Net book values under our asset-backed financings may differ from those under U.S.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) These provisions may make it more difficult for stockholders to replace members of our Board, which is responsible for appointing the members of our management.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) • limit the ability of stockholders to call a special meeting; and • authorize blank check preferred stock. These provisions may make it more difficult for stockholders to replace members of our Board, which is responsible for appointing the members of our management.
Privacy laws in the U.S. include the California Consumer Privacy Act, as amended, as well as other similar state privacy laws, which expand the definition of personal information and may grant, among other things, individual rights to access and delete personal information, and the right to opt out of the sale of personal information.
Privacy laws in the U.S. include the California Consumer Privacy Act, as amended, as well as other similar privacy laws currently imposed throughout 20 states, which expand the definition of personal information and may grant, among other things, individual rights to access and delete personal information, the right to opt out of the sale and sharing of personal information, and the right to restrict automated decision making or additional processing of sensitive personal information.
We cannot guarantee that the tanks will remain free from leaks or that the use of 31 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) these tanks will not result in significant spills or leakage.
We cannot guarantee that the tanks will remain free from leaks or that the use of these tanks will not result in significant spills or leakage. If a leak or a spill occurs, it is possible that the costs to 30 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
Additionally, any failure to manage information privacy in compliance with applicable laws, whether as a result of our own error or the error or malfeasance of others, could result in significant regulatory fines and sanctions, litigation, prolonged negative publicity, data breaches, declining customer confidence, loss of key customers, employee liability and other unfavorable consequences.
RISK FACTORS (Continued) result of our own error or the error or malfeasance of others, could result in significant regulatory fines and sanctions, litigation, prolonged negative publicity, data breaches, declining customer confidence, loss of key customers, employee liability and other unfavorable consequences.
The use of AI applications generally has resulted in, and may in the future result in, cybersecurity incidents that implicate the personal data of end users of such applications. Any such cybersecurity incidents related to our own use of AI applications could adversely affect our reputation and results of operations.
The increased use of AI applications generally has resulted in, and may in the future result in, cybersecurity incidents that implicate the personal data of end users of such applications.
RISK FACTORS (Continued) Annual Report. A portion of our indebtedness bears interest at variable rates, which exposes us to risks inherent in interest rate fluctuations and higher interest expenses in the event of continued increases in interest rates.
A portion of our indebtedness bears interest at variable rates, which exposes us to risks inherent in interest rate fluctuations and higher interest expenses in the event of continued increases in interest rates. See Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in this 2025 Annual Report for additional information related to interest rate risk.
If we choose to purchase vehicles using such financing arrangements, or if our 30 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) existing financing arrangements are deemed not to qualify under the Code, our ability to claim accelerated expensing would be limited.
If we choose to purchase vehicles using such financing arrangements, or if our existing financing arrangements are deemed not to qualify under the Code, our ability to claim accelerated expensing would be limited.
RISK FACTORS (Continued) timing of operating cost improvements and longer timeframes associated with revenue maximization initiatives. As a result, we tested the recoverability of our long-lived assets in our Americas RAC and International RAC segments by comparing the carrying values against undiscounted future cash flow projections, and we determined that an impairment existed.
As a result, we tested the recoverability of our long-lived assets in our Americas RAC and International RAC segments by 32 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) comparing the carrying values against undiscounted future cash flow projections, and we determined that an impairment existed.
The reduction was largely attributed to the acceleration of the rental fleet rotation in our segments, where shortening the useful life reduced the potential future cash flows expected to be earned from the fleet. Operating cash flow projections also deteriorated from delayed 33 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
The reduction was largely attributed to the acceleration of the rental fleet rotation in our segments, where shortening the useful life reduced the potential future cash flows expected to be earned from the fleet. Operating cash flow projections also deteriorated from delayed timing of operating cost improvements and longer timeframes associated with revenue maximization initiatives.
Strict data privacy laws regulating the collection, transmission, storage and use of 29 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) employee data and consumers’ personal information are continuously evolving in the European Union, U.S. and other jurisdictions in which we operate.
Strict data privacy laws regulating the collection, transmission, storage and use of employee data and consumers’ personal information are continuously evolving in the European Union, U.S., Australia, New Zealand, Canada and other jurisdictions in which we operate.
If customers decline to purchase supplemental liability insurance products from us as a result of any changes in these laws or otherwise, our results of operations, financial condition, liquidity and cash flows could be materially adversely affected. 32 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
If customers decline to purchase supplemental liability insurance products from us as a result of any changes in these laws or otherwise, our results of operations, financial condition, liquidity and cash flows could be materially adversely affected. Also, we derive revenue through rental activities of our brands under franchise and license arrangements.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) confidence, declining employee morale and other unfavorable consequences, which could have a material adverse effect on our business, results of operations, financial condition, liquidity and cash flows. Hertz Holdings is a publicly traded holding company with no operations of its own and depends on its subsidiaries for cash.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) Hertz Holdings is a publicly traded holding company with no operations of its own and depends on its subsidiaries for cash.
These events could, individually or in the aggregate, lead to lower revenues, increased costs or other adverse effects on our results of 28 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) operations, financial condition, liquidity and cash flows, and could cause reputational harm, any of which may be material.
These events could, individually or in the aggregate, lead to lower revenues, increased costs or other adverse effects on our results of operations, financial condition, liquidity and cash flows, and could cause reputational harm, any of which may be material. If we fail to evaluate, maintain, upgrade and consolidate our information technology systems, our business could be adversely affected.
As of December 31, 2024, we had total indebtedness of approximately $16.3 billion, including $11.2 billion of vehicle related debt and $5.1 billion of non-vehicle related debt, as disclosed in Note 7, "Debt," in Part II, Item 8 of this 2024 35 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
As of December 31, 2025, we had total indebtedness of approximately $17.1 billion, including $11.6 billion of vehicle related debt and $5.4 billion of non-vehicle related debt, as disclosed in Note 7, "Debt," in Part II, Item 8 of this 2025 Annual Report.
See Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in this 2024 Annual Report for additional information related to interest rate risk. Our ability to satisfy and manage our debt obligations depends on our ability to generate cash flow and on overall financial market conditions. Factors driving the overall condition of the financial markets are beyond our control.
Our ability to satisfy and manage our debt obligations depends on our ability to generate cash flow and on overall financial market conditions. Factors driving the overall condition of the financial markets are beyond our control.
These limitations could result in additional material cash tax payments that could have a material adverse effect on our results of operations and liquidity.
While, the OBBBA eased the interest expense limitation rules under IRC Section 163(j), these rules could still limit our deductibility of interest expense and could result in additional material cash tax payments that could have a material adverse effect on our results of operations and liquidity.
We may not be able to deduct certain business interest expenses, which could have a material adverse effect on our results of operations and liquidity. The TCJA, which was temporarily modified by the Coronavirus Aid, Relief, and Economic Security Act, imposed significant limitations on the deductibility of business interest expense under Section 163(j) of the Code.
We may not be able to deduct certain business interest expenses, which could have a material adverse effect on our results of operations and liquidity.
There can be no guarantee that all of our employees, contractors and agents will comply with the Company’s policies that mandate compliance with these laws. Violations of these laws could result in legal and regulatory sanctions, increased litigation and fines, prolonged negative publicity, diminished investor 34 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
There can be no guarantee that all of our employees, contractors and agents will comply with the Company’s policies that mandate compliance with these laws.
RISK FACTORS (Continued) Also, we derive revenue through rental activities of our brands under franchise and license arrangements. These arrangements are subject to various international, federal and state laws and regulations that impose limitations on our interactions with our counterparties.
These arrangements are subject to various international, federal and state laws and regulations that impose limitations on 31 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) our interactions with our counterparties.
Removed
ITEM 1A. RISK FACTORS (Continued) in cloud-based services and bundled software. Like many other companies, we detect attempts by threat actors to gain access to our systems and networks on a frequent basis, and the frequency of such attempts could increase in the future.
Added
Additionally, any failure to manage information privacy in compliance with applicable laws, whether as a 28 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A.
Removed
At this time, we do not have any indication that any risks from cybersecurity threats have had, or are reasonably likely to have, a material effect on our business strategy, results of operations or financial condition.
Added
The disposition of revenue earning vehicles may result in taxable income, which might not be fully offset by the taxable expense associated with newly purchased revenue earning vehicles. Under the OBBBA, we are permitted 100% bonus depreciation on vehicle purchases. However, vehicles purchased using certain financing arrangements are not eligible for accelerated depreciation election.
Removed
We have invested in the protection of data and information technology, and actively work to enhance our business continuity and disaster recovery capabilities; however, there can be no assurance that our efforts will be successful. We monitor our obligations under and compliance with global laws requiring information security safeguards and potential notification requirements in the event of a cybersecurity incident.
Added
Violations of these laws could result in legal and regulatory sanctions, increased litigation and fines, prolonged negative publicity, diminished investor confidence, declining employee morale and other unfavorable consequences, which could have a material adverse effect on our business, results of operations, financial condition, liquidity and cash flows. 33 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Removed
We maintain procedures for detecting, communicating and addressing cybersecurity incidents. We have also taken steps to assess cybersecurity of third parties business partners, including service providers, licensees and franchisees, that handle, possess, process and store our material information. We require these third parties to maintain certain security controls.
Added
As of December 31, 2025, we had available borrowing capacity of $924 million under the First Lien RCF. Furthermore, we are also able to incur certain additional indebtedness subject to compliance with our existing 34 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1A. RISK FACTORS (Continued) covenants.
Removed
However, because of the rapidly changing nature and sophistication of cybersecurity threats, which can be difficult to detect, there can be no guarantee that our controls, policies and procedures have or will detect or prevent all of these cybersecurity threats, and we cannot predict the full impact of any past or future cybersecurity incident.
Added
GAAP book values due to differences in depreciation rates primarily under our asset-backed financings.
Removed
A cybersecurity incident relating to our information or systems or that of our third-party business partners, or any failure by us or our third-party business partners to effectively address, enforce and maintain our information technology infrastructure and cybersecurity requirements may result in substantial harm to our business strategy, results of operations and financial condition, including major disruptions to business operations, loss of intellectual property, release of confidential information, alteration or corruption of data or systems, costs related to remediation or the payment of ransom and litigation, including individual claims or consumer class actions, commercial litigation, administrative, and civil or criminal investigations or actions, regulatory intervention and sanctions or fines, investigation and remediation costs, and possible prolonged negative publicity.
Added
Any such cybersecurity incidents related to our own use of AI applications may increase our cybersecurity risks, as well as the cybersecurity risks of third parties, which could adversely affect our reputation and results of operations.
Removed
Our customers’ information, including their loyalty account login information, can be a target for cyber criminals. Given that customers may share common credentials across multiple sites, a compromise of one site can provide cyber criminals the means to compromise customer accounts of other merchants and any customer information contained therein.
Removed
Although we maintain a cyber insurance policy, there is no guarantee that such coverage will be sufficient to address costs, liabilities and damages we may incur in connection with a cybersecurity incident or that such coverage will continue to be available on commercially reasonable terms or at all.
Removed
Our business is heavily reliant upon information technology systems, some of which are managed, hosted, provided or used by third parties, including cloud-based service providers, and any significant failures or disruptions to these systems could adversely impact our business.
Removed
Our ability to, among other things, accept reservations, process rental and sales transactions, manage our pricing, manage our revenue earning vehicles, manage our financing arrangements, account for our activities and otherwise conduct our business depends on the performance and availability of our networks and systems, as well as those of third-party cloud-based providers and other business partners.
Removed
We have experienced, and from time to time in the future may experience, a failure or interruption that results in the unavailability of certain information systems. Additionally, our major information technology systems, reservations and accounting functions are centralized in a few locations worldwide.
Removed
If we fail to evaluate, maintain, upgrade and consolidate our information technology systems, our business could be adversely affected.
Removed
We were permitted under the Tax Cuts and Jobs Act (the “TCJA”) to expense, in the year of acquisition, 100% of the acquisition costs for vehicles purchased during the years 2017 through 2022. The TCJA reduces the expensing percentage ratably by 20% each year between 2023 and 2027.
Removed
This reduction in expensing percentage could create situations whereby tax depreciation could be significantly less than the tax gain on the disposition of vehicles acquired in prior years. In addition, vehicles purchased using certain financing arrangements are not eligible for this accelerated depreciation election.
Removed
In addition to litigation associated with our ongoing operations, we are a defendant in certain litigation related to our emergence from bankruptcy in June 2021, including the case adversary proceeding captioned Wells Fargo Bank, National Association v. The Hertz Corporation, et. al. See Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2024 Annual Report.
Removed
We cannot predict the ultimate outcome or timing of this litigation; however, in light of the amount potentially at issue in the case, the adverse ruling by the U.S.
Removed
Court of Appeals for the Third Circuit, followed by entry of an order of judgment, could have a material adverse impact on the Company’s financial condition, results of operations, liquidity or cash flows, particularly in the period in which an adverse judgment is entered.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

12 edited+0 added−0 removed10 unchanged
Biggest changePrior to joining the Company, our CIO held various executive technology and operations positions, as well as various IT, consulting and commercial roles. Our CIO holds an Executive MBA and a Bachelor of Commerce degree.
Biggest changePrior to joining the Company, our CITO was the Chief Operating and Information Officer at The Container Store, and has also previously held various other executive technology and customer positions. Our CITO holds an MBA; in addition, he holds a Bachelor of Engineering in Electronics and Telecommunication degree.
There can be no assurance, however, that our cybersecurity efforts will always be successful, and it is possible that risks from cybersecurity threats could have a material effect on our business strategy, results of 41 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1C. CYBERSECURITY (Continued) operations or financial condition in the future.
There can be no assurance, however, that our cybersecurity efforts will always be successful, and it is possible that risks from cybersecurity threats could have a material effect on our business strategy, results of 40 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 1C. CYBERSECURITY (Continued) operations or financial condition in the future.
See “Risks Related to Information Technology, Cybersecurity and Privacy” in Item 1A, "Risk Factors” of this 2024 Annual Report. Governance Our Board oversees significant risks facing the Company. For some categories of risk, the Board has empowered a committee to provide more focused oversight.
See “Risks Related to Information Technology, Cybersecurity and Privacy” in Item 1A, "Risk Factors” of this 2025 Annual Report. Governance Our Board oversees significant risks facing the Company. For some categories of risk, the Board has empowered a committee to provide more focused oversight.
Our CISO coordinates with the Company’s disclosure teams relating to potentially material cybersecurity incidents, attends the Company’s disclosure committee meetings, and regularly discusses with the Audit Committee the effectiveness of the Company’s technology security, capabilities for disaster recovery, data protection, cyber threat detection and cyber incident response and management of technology-related compliance risks.
Our CISO coordinates with the Company’s disclosure teams relating to cybersecurity incidents, attends the Company’s disclosure committee meetings, and regularly discusses with the Audit Committee the effectiveness of the Company’s technology security, capabilities for disaster recovery, data protection, cyber threat detection and cyber incident response and management of technology-related compliance risks.
Our Chief Information Security Officer ("CISO") is the individual that reports to our CIO and provides day-to-day oversight of our cybersecurity program; our CISO additionally leads our cybersecurity program's ongoing evolution. Our CISO is responsible for assessing and managing risks from cybersecurity threats, including monitoring the prevention, detection, mitigation and remediation of cybersecurity threats.
Our Chief Information Security Officer ("CISO") is the individual that reports to our CITO and provides day-to-day oversight of our cybersecurity program; our CISO additionally leads our cybersecurity program's ongoing evolution. Our CISO is responsible for assessing and managing risks from cybersecurity threats, including monitoring the prevention, detection, mitigation and remediation of cybersecurity threats.
Our CISO has served in this role since March 2024. Our CISO has over 11 years of experience in senior technology roles with cybersecurity responsibilities, and more than 20 years of experience in technology and security. Our CISO holds an MBA; in addition, he holds a Bachelor of Computer Science degree and a Bachelor of Mathematics degree.
Our CISO has served in this role since March 2024. Our CISO has over 12 years of experience in senior technology roles with cybersecurity responsibilities, and more than 20 years of experience in technology and security. Our CISO holds an MBA; in addition, he holds a Bachelor of Computer Science degree and a Bachelor of Mathematics degree.
We take steps to prevent and detect cybersecurity threats in an effort to protect our information and systems, and in turn, to protect our customers’ privacy. Additionally, we have taken steps to address material risks from cybersecurity threats at third parties, including service providers, licensees and franchisees, that handle, possess, process and store our material information.
We take steps to prevent and detect cybersecurity threats in an effort to protect our information and systems, and in turn, to protect our customers’ privacy. Additionally, we have taken steps to address risks from cybersecurity threats at third parties, including service providers, licensees and franchisees, that handle, possess, process and store our significant business information.
We review the results of the assessments from these third parties and determine whether to adjust our cybersecurity policies and processes based thereon. We also have a privacy and data security program, which covers the collection, transfer, storage and use of customer data.
We review the results of the assessments from these third parties and use these results, among other things, to determine whether to adjust our cybersecurity policies and processes. We also have a privacy and data security program, which covers the collection, transfer, storage and use of customer data.
An ERM Committee meets regularly to discuss the Company’s top risks. Through our ERM process, we have identified cybersecurity as among the material risks in our business. One way we manage cybersecurity risks is through our Global Information Security and Compliance ("GISC") program.
An ERM Committee meets regularly to discuss the Company’s top risks. Through our ERM process, we have identified cybersecurity as among the material risks in our business. We manage cybersecurity risks through our Global Information Security and Compliance ("GISC") program. The GISC program is designed to protect the confidentiality, integrity and availability of our information systems and data.
One of the business continuity plans in place at the Company is a plan applicable to our data centers. Given the dynamic nature of the cybersecurity threat environment, we engage third-party assessors, consultants and others from time to time to assist us with assessing, enhancing, implementing and monitoring our cybersecurity risk-management programs.
Given the dynamic nature of the cybersecurity threat environment, we engage third-party assessors, consultants and others from time to time to assist us with assessing, enhancing, implementing and monitoring our cybersecurity risk-management programs.
The GISC program is designed to protect the confidentiality, integrity and availability of our information systems and data. Our GISC program includes procedures that are specifically designed to assess, identify and manage material risks from cybersecurity threats.
Our GISC program includes procedures that are specifically designed to assess, identify and manage material risks from cybersecurity threats.
Direct accountability of our cybersecurity program is housed within our Information Technology organization, which is led by our Chief Information Officer ("CIO"). Our CIO has served in this role since October 2021. Our CIO has 12 years of experience in senior technology roles with cybersecurity responsibilities.
Direct accountability of our cybersecurity program is housed within our Information Technology organization, which is led by our Chief Information Technology Officer ("CITO"). Our CITO has more than 30 years of global leadership experience across technology, digital transformation, operations and customer experience.

Item 2. Properties

Properties — owned and leased real estate

3 edited+1 added−1 removed2 unchanged
Biggest changeWe lease a facility in Oklahoma City, Oklahoma at which at which reservations for our vehicle rental operations are processed, global information technology systems are serviced and certain finance and accounting functions are performed.
Biggest changeWe lease facilities in Oklahoma City, Oklahoma at which reservations for our vehicle rental operations are processed, global information technology systems are serviced and certain finance and accounting functions are performed. Additionally, we lease a facility near Dublin, Ireland, at which we have centralized our European vehicle rental reservation, customer relations, accounting and human resource functions.
The remaining locations from which we operate our vehicle rental businesses are leased or operated under concessions from governmental authorities and private 42 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 2. PROPERTIES (Continued) entities.
The remaining locations from which we operate our vehicle rental businesses are leased or operated under concessions from governmental authorities and private 41 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 2. PROPERTIES (Continued) entities.
We also operate vehicle rental operations internationally, where Australia, France, Italy, Spain and the U.K. account for approximately 30% of our International RAC segment rental locations. We own approximately 5% of the locations from which we operate our vehicle rental businesses and in some cases own real property that we lease to franchisees or other third parties.
We also operate vehicle rental operations internationally, where Australia, France, Italy, Spain and the U.K. account for approximately 40% of our International RAC segment rental locations. We own approximately 3% of the locations from which we operate our vehicle rental businesses and in some cases own real property that we lease to franchisees or other third parties.
Removed
Additionally, we have a 999-year lease for a reservation and financial center near Dublin, Ireland, at which we have centralized our European vehicle rental reservation, customer relations, accounting and human resource functions. We also lease a European headquarters office in Uxbridge, England.
Added
We also lease a European headquarters office in Uxbridge, England. We consider that our properties are generally in good condition, well maintained and are suitable and adequate to carry on our business.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

8 edited+10 added−8 removed4 unchanged
Biggest changeAND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES INFORMATION ABOUT OUR EXECUTIVE OFFICERS (Continued) Mr. Leef has served as Executive Vice President and Chief Human Resources Officer of the Company since February 2021, and he served as Senior Vice President and Chief Human Resources Officer beginning in September 2020. Prior to joining the Company, from October 2019 to July 2020, Mr.
Biggest changeMr. Kosman has served as Senior Vice President and Chief Accounting Officer of the Company since September 2025. Prior to joining the Company, he spent over 35 years at Ford Motor Company (NYSE: F), an automobile manufacturer, retiring in August 2025, where he served as Chief Accounting Officer from February 2024 to July 2025.
West also served on the board of Genesis Park Acquisition Corporation from October 2020 to September 2021. Mr. Haralson has served as Executive Vice President and Chief Financial Officer of the Company since June 2024. Prior to joining the Company, from February 2023 to June 2024, he was Executive Vice President and Chief Financial Officer of Spirit Airlines, Inc.
West also served on the board of Genesis Park Acquisition Corporation from October 2020 to September 2021. Mr. Haralson has served as Executive Vice President and Chief Financial Officer ("CFO") of the Company since June 2024. Prior to joining the Company, from February 2023 to June 2024, he was Executive Vice President and CFO of Spirit Airlines, Inc.
West has served as Chief Executive Officer and as a director of the Company since April 2024. He was Chief Operating Officer of Cruise LLC (“Cruise”), a self-driving car company, from January 2021 to December 2023. Prior to that, from March 2014 to October 2020, Mr.
West has served as Chief Executive Officer ("CEO") and as a director of the Company since April 2024. He was Chief Operating Officer of Cruise LLC (“Cruise”), a self-driving car company, from January 2021 to December 2023. Prior to that, from March 2014 to October 2020, Mr.
West was Senior Executive Vice President and Chief Operating Officer of Delta Air Lines, Inc. (“Delta”), a global airline company, and from March 2008 to March 2014, he was Senior Vice President of Delta. From 2006 to 2007, prior to joining Delta, Mr. West was President and Chief Executive Officer of Laidlaw Transit Services, Inc., a provider of transportation services.
West was Senior Executive Vice President and Chief Operating Officer of Delta Air Lines, Inc. (“Delta”), a global airline company, and from March 2008 to March 2014, he was Senior Vice President of Delta. From 2006 to 2007, prior to joining Delta, Mr. West was President and CEO of Laidlaw Transit Services, Inc., a provider of transportation services.
(“Spirit”), an airline company. He served as Senior Vice President and Chief Financial Officer of Spirit from October 2018 to January 2023; as Vice President, Financial Planning and Analysis and Corporate Real Estate from August 2017 to October 2018; and as Vice President, Financial Planning and Analysis from August 2012 to July 2017. Prior to his tenure at Spirit, Mr.
(“Spirit”), an airline company. He served as Senior Vice President and CFO of Spirit from October 2018 to January 2023; as Vice President, Financial Planning and Analysis and Corporate Real Estate from August 2017 to October 2018; and as Vice President, Financial Planning and Analysis from August 2012 to July 2017. Prior to his tenure at Spirit, Mr.
He also served, from September 2018 to November 2020, as Senior Vice President, Head of Digital, Loyalty, Lounges and Consumer Insights, and Chief Executive Officer of Delta Vacations, a subsidiary of Delta, and from January 2015 to August 2018, as Vice President, Customer Loyalty and Consumer Insights. In addition, Mr.
He also served, from September 2018 to November 2020, as Senior Vice President, Head of Digital, Loyalty, Lounges and Consumer Insights, and CEO of Delta Vacations, a subsidiary of Delta, and from January 2015 to August 2018, as Vice President, Customer Loyalty and Consumer Insights. In addition, Mr.
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 43 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES INFORMATION ABOUT OUR EXECUTIVE OFFICERS The table below sets forth, as of February 6, 2025, the names, ages, and positions of our executive officers. Name Age Position W. Gil West 64 Chief Executive Officer Scott M.
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 42 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES INFORMATION ABOUT OUR EXECUTIVE OFFICERS The table below sets forth, as of February 19, 2026, the names, ages, and positions of our executive officers. Name Age Position W. Gil West 65 Chief Executive Officer Scott M.
Dube was Senior Vice President, Marketing of Wells Fargo Bank, National Association, a financial services company, from 2012 to 2015 and was Senior Vice President, Marketing Strategy and Analytics (Credit Cards) of HSBC USA Inc., a financial services company, from 2006 to 2012. Ms. Martin has served as Executive Vice President, General Counsel and Corporate Secretary since July 2024.
Dube was Senior Vice President, Marketing of Wells Fargo Bank, National Association, a financial services company, from 2012 to 2015 and was Senior Vice President, Marketing Strategy and Analytics (Credit Cards) of HSBC USA Inc., a financial services company, from 2006 to 2012. Mr. Bussani has served as Executive Vice President and Chief Legal Officer since October 2025.
Removed
Haralson 51 Executive Vice President and Chief Financial Officer Sandeep Dube 49 Executive Vice President and Chief Commercial Officer Katherine Lee Martin 48 Executive Vice President, General Counsel and Corporate Secretary Eric J. Leef 51 Executive Vice President and Chief Human Resources Officer Kelly Galloway 40 Senior Vice President and Chief Accounting Officer Mr.
Added
Haralson 52 Executive Vice President and Chief Financial Officer Sandeep Dube 50 Executive Vice President and Chief Commercial Officer Piero Bussani 60 Executive Vice President and Chief Legal Officer Chris Berg 47 Executive Vice President and Chief Administrative Officer Mark Kosman 60 Senior Vice President and Chief Accounting Officer Mr.
Removed
She was Interim General Counsel and Assistant Corporate Secretary from April 2024 to July 2024. Ms. Martin joined the Company in May 2023 as Vice President and Chief Counsel and took on the additional role of Chief Compliance Officer from January 2024 to June 2024. From August 2021 to April 2023, she held various leadership positions at X Corp.
Added
From January 2023 to July 2025, Mr. Bussani was Chief Legal Officer at Homebound Inc., a privately held technology-enabled homebuilding platform. From August 2017 to January 2023, Mr. Bussani was Chief Legal Executive Vice President, Chief Legal Officer and Head of Global Legal for Blackstone Group’s real estate platform, Revantage Corporate Services.
Removed
(formerly, Twitter, Inc.), a social media and technology company. Prior to that, Ms. Martin spent more than a decade as an Assistant U.S. Attorney at the U.S. Department of Justice.
Added
He previously served as Managing Director and Chief Legal Officer for Digital Bridge Holdings, LLC from 2015 to July 2017. Prior to serving in that role, Mr.
Removed
She served as a law clerk in the United States District Court for the Eastern District of Virginia following law school and earned her J.D. from the William & Mary Law School. Prior to law school, Ms. Martin worked as a staff member for the U.S. House of Representatives. 44 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Added
Bussani was an executive with several Blackstone-owned real estate companies, including serving as Chief Legal Officer and Executive Vice President for Invitation Homes (NYSE: INVH) from 2013 through 2015, General Counsel and Executive Vice President of LXR Luxury Resorts & Hotels from 2004 through 2013 and General Counsel and Executive Vice President of Development for Extended Stay Hotels from 1996 through 2004.
Removed
Leef was Senior Vice President, Chief Human Resources Officer of Atria Senior Living, a provider of independent, assisted living and memory care options. Prior to that, from 2013 to 2019, Mr.
Added
Mr. Bussani began his career as an attorney in the litigation and real estate 43 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES INFORMATION ABOUT OUR EXECUTIVE OFFICERS (Continued) practice groups of the Washington, D.C. law firm Arent Fox Kintner Plotkin & Kahn from 1991 to 1995. Mr.
Removed
Leef served as Executive Director, HR Client Support of General Electric Company and GE Appliances, a Haier company that manufacturers appliances, and beginning in 2003, he held various other human resources roles at GE Appliances. Ms. Galloway has served as Senior Vice President and Chief Accounting Officer of the Company since July 2023.
Added
Bussani has served as a Trustee of CubeSmart (NYSE: CUBE) since February 2010, where he also serves as the Chair of the Governance & Nominating Committee and serves on the Compensation Committee. He also serves as a Trustee of Cleveland Clinic Weston. Mr. Berg has served as Executive Vice President and Chief Administrative Officer of the Company since January 2025.
Removed
She served as Senior Vice President and Controller from August 2020 to July 2023, as Vice President and Controller from August 2019 to August 2020, as Assistant Corporate Controller from August 2018 to August 2019, and in other Company accounting-related roles from September 2014 to August 2018. Prior to joining the Company, Ms.
Added
His responsibilities include global responsibility for Technology, Human Resources, Global Supplier Management, Real Estate, Facilities and Innovation.
Removed
Galloway held roles at Kforce Inc. and PricewaterhouseCoopers LLP, both professional services firms, and she is a Certified Public Accountant. 45 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES PART II
Added
Prior to joining the Company, he spent over 20 years in various leadership roles at The Home Depot (NYSE: HD), a home improvement retailer, most recently serving as the company's President, Western Division from 2021 to 2024; Vice President, Pro Strategy and Enterprise-Wide Transformations from 2019 to 2021; Regional Vice President from 2016 to 2019; Vice President, Store Operations from 2012 to 2013; and other successive roles from 2001 to 2012.
Added
He also served as Transformation Leader from 2022 to 2024; Director of Accounting/I-ERP and Internal Controls Transformation from August 2020 to January 2024; Regional CFO, North America, from 2018 to 2022; Regional CFO, APAC from 2012 to 2018; and various key finance positions from 1989 to 2012. 44 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Added
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

70 edited+14 added−117 removed32 unchanged
Biggest changeHERTZ Years Ended December 31, (In millions) 2024 2023 Net income (loss) $ (3,137) $ 452 Adjustments: Income tax provision (benefit) (375) (329) Non-vehicle depreciation and amortization 139 149 Non-vehicle debt interest, net 375 238 Vehicle debt-related charges (1) 45 42 Restructuring and restructuring related charges (2) 66 17 Unrealized (gains) losses on financial instruments (3) 7 117 Gain on sale of non-vehicle capital assets (4) — (162) Non-cash stock-based compensation forfeitures (5) (64) — Bankruptcy-related litigation reserve (6) 292 — Long-Lived Assets impairment (7) 1,048 — Other items (8) 63 37 Adjusted Corporate EBITDA $ (1,541) $ 561 56 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Biggest changeHERTZ Years Ended December 31, (In millions) 2025 2024 Net income (loss) $ (703) $ (3,137) Adjustments: Income tax provision (benefit) (83) (375) Non-vehicle depreciation and amortization 117 139 Non-vehicle debt interest, net (1) 498 375 Vehicle debt-related charges (2) 46 45 Restructuring and restructuring related charges (3) 18 66 Unrealized (gains) losses on financial instruments (4) (37) 7 Gain on sale of non-vehicle capital assets (5) (144) — Legal settlement (6) (154) — Bankruptcy-related litigation reserve (7) 24 292 Long-Lived Assets impairment (8) — 1,048 Non-cash stock-based compensation forfeitures (9) — (64) Other items (10) 79 63 Adjusted Corporate EBITDA $ (339) $ (1,541) HERTZ GLOBAL Years Ended December 31, (In millions) 2025 2024 Net income (loss) $ (747) $ (2,862) Adjustments: Income tax provision (benefit) (83) (375) Non-vehicle depreciation and amortization 117 139 Non-vehicle debt interest, net (1) 498 375 Vehicle debt-related charges (2) 46 45 Restructuring and restructuring related charges (3) 18 66 Unrealized (gains) losses on financial instruments (4) (37) 7 Gain on sale of non-vehicle capital assets (5) (144) — Legal settlement (6) (154) — Bankruptcy-related litigation reserve (7) 24 292 Long-Lived Assets impairment (8) — 1,048 Non-cash stock-based compensation forfeitures (9) — (64) Change in fair value of Public Warrants (11) 44 (275) Other items (10) 79 63 Adjusted Corporate EBITDA $ (339) $ (1,541) 56 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
The credit agreement governing Hertz's First Lien Credit Facilities and the indentures governing the First Lien Senior Notes, the Exchangeable Notes, the Senior Notes Due 2026 and the Senior Notes Due 2029 provide conditions that limit when Hertz can make dividends and certain other restricted payments, including restrictions for distributions to Hertz Holdings used to pay dividends on Hertz Holdings' common stock.
The credit agreement governing Hertz's First Lien Credit Facilities and the indentures governing the First Lien Senior Notes, the Exchangeable Notes, the Senior Notes Due 2026 and the Senior Notes Due 2029 provide conditions that limit when Hertz can make dividends and certain other restricted payments, including restrictions for distributions to Hertz Holdings used to pay dividends on Hertz Holdings' common stock.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Our expenses primarily consist of: • direct vehicle and operating expense ("DOE"), primarily wages and related benefits; commissions and concession fees paid to airport authorities, travel agents and others; facility, self-insurance and reservation costs; and other costs relating to the operation and rental of revenue earning vehicles, such as collision and damage, maintenance, fuel and electric charging costs; • depreciation expense and lease charges, net relating to revenue earning vehicles, including gains and losses and related costs associated with the disposal of vehicles; • depreciation and amortization expense relating to non-vehicle assets; • selling, general and administrative expense ("SG&A"), which includes advertising costs and administrative personnel costs, along with costs for information technology and business transformation programs; and • interest expense, net.
Our expenses primarily consist of: • direct vehicle and operating expense ("DOE"), primarily wages and related benefits; commissions and concession fees paid to airport authorities, travel agents and others; facility, self-insurance and reservation costs; and other costs relating to the operation and rental of revenue earning vehicles, such as collision and damage, maintenance, fuel and electric charging costs; • depreciation expense and lease charges, net relating to revenue earning vehicles, including gains and losses and related costs associated with the disposal of vehicles, including vehicle sales; • depreciation and amortization expense relating to non-vehicle assets; • selling, general and administrative expense ("SG&A"), which includes advertising costs and administrative personnel costs, along with costs for information technology and business transformation programs; and • interest expense, net.
Our actual results may differ materially from those contained in or implied by any forward-looking statements. You should read the following MD&A together with the sections entitled “Cautionary Note Regarding Forward-Looking Statements and Summary of Risk Factors,” Item 1A, "Risk Factors” and our consolidated financial statements and related notes included in Part II, Item 8 of this 2024 Annual Report.
Our actual results may differ materially from those contained in or implied by any forward-looking statements. You should read the following MD&A together with the sections entitled “Cautionary Note Regarding Forward-Looking Statements and Summary of Risk Factors,” Item 1A, "Risk Factors” and our consolidated financial statements and related notes included in Part II, Item 8 of this 2025 Annual Report.
Footnotes to the Results of Operations and Selected Operating Data by Segment Tables (a) Adjusted Corporate EBITDA is calculated as net income (loss), adjusted for income taxes; non-vehicle depreciation and amortization; non-vehicle debt interest, net; vehicle debt-related charges; restructuring and restructuring related charges; unrealized (gains) losses from financial instruments; change in fair value of Public Warrants and certain other miscellaneous or non-recurring items.
Footnotes to the Results of Operations and Selected Operating Data by Segment Tables (a) Adjusted Corporate EBITDA is calculated as net income (loss), adjusted for income taxes; non-vehicle depreciation and amortization; non-vehicle debt interest, net; vehicle debt-related charges; restructuring and restructuring related charges; unrealized (gains) losses from financial instruments; change in fair value of Public Warrants and certain other miscellaneous items.
A number of our other major operating costs, including airport concession fees, commissions and vehicle liability expenses, are directly related to revenues or transaction volumes. Certain operating expenses, including real estate taxes, rent, insurance, utilities, maintenance and other facility-related expenses, and minimum staffing costs, remain fixed and cannot be adjusted for demand. 49 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
A number of our other major operating costs, including airport concession fees, commissions and vehicle liability expenses, are directly related to revenues or transaction volumes. Certain operating expenses, including real estate taxes, rent, insurance, utilities, maintenance and other facility-related expenses, and minimum staffing costs, remain fixed and cannot be adjusted for demand. 48 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Amounts, such as percentages, are calculated from the underlying numbers in thousands, and as a result, may not agree to the amount when calculated from the tables in millions. Discussions regarding our results of operations, liquidity and capital resources for the year ended December 31, 2024 compared to the year ended December 31, 2023 are included within this MD&A.
Amounts, such as percentages, are calculated from the underlying numbers in thousands, and as a result, may not agree to the amount when calculated from the tables in millions. Discussions regarding our results of operations, liquidity and capital resources for the year ended December 31, 2025 compared to the year ended December 31, 2024 are included within this MD&A.
We periodically review and adjust the mix between program and non-program vehicles in our fleet based on contract negotiations and the economic environment pertaining to our industry in an effort to optimize the mix of vehicles. The use of program vehicles reduces the volatility associated with residual value estimation. 50 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
We periodically review and adjust the mix between program and non-program vehicles in our fleet based on contract negotiations and the economic environment pertaining to our industry in an effort to optimize the mix of vehicles. The use of program vehicles reduces the volatility associated with residual value estimation. 49 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Hertz Holdings paid no cash dividends on its common stock in 2024 or 2023, and it does not expect to pay dividends on its common stock for the foreseeable future. Since Hertz Holdings does not conduct business itself, any dividends on, and repurchases of, its common stock must be funded using dividends or amounts borrowed from Hertz or independent borrowings.
Hertz Holdings paid no cash dividends on its common stock in 2025 or 2024, and it does not expect to pay dividends on its common stock for the foreseeable future. Since Hertz Holdings does not conduct business itself, any dividends on, and repurchases of, its common stock must be funded using dividends or amounts borrowed from Hertz or independent borrowings.
When a revenue earning vehicle is acquired outside of a vehicle repurchase program, which is the case for the majority of our fleet at December 31, 2024, we estimate the period that we will hold the asset, primarily based on historical measures of the amount of rental activity (e.g., automobile mileage).
When a revenue earning vehicle is acquired outside of a vehicle repurchase program, which is the case for the majority of our fleet at December 31, 2025, we estimate the period that we will hold the asset, primarily based on historical measures of the amount of rental activity (e.g., automobile mileage).
MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES (Continued) to a registration statement on Form S-1), at the market close, through December 31, 2024. Share price performance presented below is not necessarily indicative of future results.
MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES (Continued) to a registration statement on Form S-1), at the market close, through December 31, 2025. Share price performance presented below is not necessarily indicative of future results.
GAAP measure, in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A. 48 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
GAAP measure, in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A. 47 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
The results are based on an assumed $100 invested on November 9, 2021 (the first day of trading pursuant 46 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 5.
The results are based on an assumed $100 invested on November 9, 2021 (the first day of trading pursuant 45 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 5.
Americas RAC recognized an impairment charge of $865 million in 2024 associated with certain long-lived assets, of which $740 million and $125 million related to its revenue earning vehicles and ROU assets, respectively. See Note 3, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2024 Annual Report for further details.
Americas RAC recognized an impairment charge of $865 million in 2024 associated with certain long-lived assets, of which $740 million and $125 million related to its revenue earning vehicles and ROU assets, respectively. See Note 4, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2025 Annual Report for further details.
Differences between the operations and results of Hertz and Hertz Global are separately disclosed and explained. 47 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Differences between the operations and results of Hertz and Hertz Global are separately disclosed and explained. 46 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Subsequent to the expiration of Amendment No. 8, any future share repurchases will be made at the discretion of Hertz Global's management through a variety of methods, such as open-market transactions (including pre-set trading plans pursuant to Rule 10b5-1 under the Exchange Act), privately negotiated transactions, accelerated share repurchases and other transactions in accordance with applicable securities laws.
Any future share repurchases will be made at the discretion of Hertz Global's management through a variety of methods, such as open-market transactions (including pre-set trading plans pursuant to Rule 10b5-1 under the Exchange Act), privately negotiated transactions, accelerated share repurchases and other transactions in accordance with applicable securities laws.
As of December 31, 2024, $874 million remains available under the 2022 Share Repurchase Program.
As of December 31, 2025, $874 million remains available under the 2022 Share Repurchase Program.
Also included are collections from customers for vehicle damages, ancillary revenues associated with retail vehicle sales and certain royalty fees from our franchisees (such fees are approximately 2% of total revenues each period).
Also included are collections from customers for vehicle damages, ancillary revenues associated with, but not limited to, retail vehicle sales and certain royalty fees from our franchisees (such fees are approximately 2% of total revenues each period).
Airport revenues comprised 69% and 68% of total revenues for the segment in 2024 and 2023, respectively.
Airport revenues comprised 68% and 69% of total revenues for the segment in 2025 and 2024, respectively.
(9) Represents the change in fair value during the reporting period for Hertz Global's outstanding Public Warrants, as disclosed in Note 13, "Fair Value Measurements," in Part II, Item 8 of this 2024 Annual Report.
(11) Represents the change in fair value during the reporting period for Hertz Global's outstanding Public Warrants, as disclosed in Note 13, "Fair Value Measurements," in Part II, Item 8 of this 2025 Annual Report.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES HERTZ GLOBAL Hertz Holdings' common stock and Public Warrants trade on The Nasdaq Global Select Market ("Nasdaq") under the symbols "HTZ" and "HTZWW," respectively. As of February 6, 2025, there were 833 holders of record of Hertz Holdings' common stock.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES HERTZ GLOBAL Hertz Holdings' common stock and Public Warrants trade on The Nasdaq Global Select Market ("Nasdaq") under the symbols "HTZ" and "HTZWW," respectively. As of February 19, 2026, there were 741 holders of record of Hertz Holdings' common stock.
In addition to the above reportable segments, we have corporate operations. We assess performance and allocate resources based upon the financial information for our operating segments. Revenue Earning Vehicles Revenue earning vehicles used in our rental and leasing operations are recorded at cost, net of related discounts and incentives from manufacturers. Holding periods typically range from six to sixty-six months.
In addition to the above reportable segments, we have corporate operations. We assess performance and allocate resources based upon the financial information for our operating segments. Revenue Earning Vehicles Revenue earning vehicles used in our rental and leasing operations are recorded at cost, net of related discounts and incentives from manufacturers.
The vehicle is depreciated using a rate based on these estimates. Depreciation rates are reviewed on a quarterly basis based on management's ongoing assessment of present and estimated future market conditions, their effect on residual values at the expected time of disposal and any changes to the estimated holding period of the vehicle.
Depreciation rates are reviewed on a quarterly basis based on management's ongoing assessment of present and estimated future market conditions, their effect on residual values at the expected time of disposal and any changes to the estimated holding period of the vehicle.
Hertz paid dividends to Hertz Holdings of $321 million and $2,477 million in 2023 and 2022, respectively, to help fund common stock repurchases, as further disclosed in Note 17, "Equity and Earnings (Loss) Per Common Share – Hertz Global" in Part II, Item 8 of this 2024 Annual Report.
Hertz paid cash dividends to Hertz Holdings of $321 million in 2023 to help fund common stock repurchases, as further disclosed in Note 17, "Equity and Earnings (Loss) Per Common Share – Hertz Global" in Part II, Item 8 of this 2025 Annual Report.
For the year ended December 31, 2024, we recorded a tax benefit of $375 million, which resulted in an effective tax rate of 11%. For the year ended December 31, 2023, we recorded a tax benefit of $329 million, which resulted in an effective tax rate of (268)%.
For the year ended December 31, 2025, we recorded a tax benefit of $83 million, which resulted in an effective tax rate of 11%. For the year ended December 31, 2024, we recorded a tax benefit of $375 million, which resulted in an effective tax rate of 11%.
(b) Transaction Days represents the total number of 24-hour periods, with any partial period counted as one Transaction Day, that vehicles were on rent (the period between when a rental contract is opened and closed) in a given period.
(b) Transaction Days represents the total number of 24-hour periods, with any partial period counted as one Transaction Day, that vehicles were on rent (the period between when a rental contract is opened and closed) in a given period. Thus, it is possible for a vehicle to attain more than one Transaction Day in a 24-hour period.
Our profitability is primarily a function of the volume, mix and pricing of rental transactions and the utilization of vehicles, the related ownership cost of vehicles and other operating costs.
Our profitability is primarily a function of the volume, mix and pricing of rental transactions and the utilization of vehicles based on its availability to rent, the related ownership cost of vehicles and other operating costs.
In 2024, Hertz paid dividends to Hertz Holdings of $7 million for certain general purposes.
In 2025 and 2024, Hertz paid cash dividends to Hertz Holdings of $13 million and $7 million for certain general purposes.
The 2022 Share Repurchase Program, announced on June 15, 2022, has no expiration date, does not obligate Hertz Global to acquire any particular amount of common stock and can be discontinued at any time.
The 2022 Share Repurchase Program, announced on June 15, 2022, has no expiration date, does not obligate Hertz Global to acquire any particular amount of common stock and can be discontinued at any time. There were no share repurchases during the years ended December 31, 2025 and 2024.
In 2024, we recognized expense of $292 million in our corporate operations related to an increase to an existing bankruptcy-related litigation reserve, including related interest that continues to accrue during each subsequent reporting period, as disclosed in Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2024 Annual Report.
In 2025, we recognized additional expense of $24 million in our corporate operations related to an existing bankruptcy-related litigation reserve for interest that continues to accrue during each subsequent reporting period until resolved. Refer also to Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2025 Annual Report.
In 2024, we recognized an impairment charge of $1.0 billion associated with certain long-lived assets in our Americas RAC and International RAC segments. See Note 3, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2024 Annual Report for further details.
In 2024, we recognized an impairment charge of $1.0 billion associated with the Long-Lived Assets in our Americas RAC and International RAC segments, as disclosed in Note 4, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2025 Annual Report.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) (c) Vehicle Utilization is calculated by dividing total Transaction Days by Available Car Days. Available Car Days represents Average Rentable Vehicles multiplied by the number of days in a given period.
(c) Vehicle Utilization is calculated by dividing total Transaction Days by Available Car Days. Available Car Days represents Average Rentable Vehicles multiplied by the number of days in a given period.
NM - Not meaningful Year Ended December 31, 2024 Compared with Year Ended December 31, 2023 Total Americas RAC revenues decreased $324 million in 2024 compared to 2023 due primarily to lower pricing. Total RPD declined due primarily to lower rates in most customer channels. Transaction Days was generally consistent with 2023.
NM - Not meaningful Year Ended December 31, 2025 Compared with Year Ended December 31, 2024 Total Americas RAC revenues decreased $639 million in 2025 compared to 2024 due primarily to lower pricing and lower volume. Total RPD and Transaction Days declined across most customer channels in 2025 compared to 2024.
International RAC As of December 31, 2024, our International RAC operations had approximately 6,200 company-operated and franchisee locations, comprised of 1,500 airport and 4,700 off airport locations in approximately 110 countries and jurisdictions, including Africa, Asia, Australia, Europe, the Middle East and New Zealand.
International RAC As of December 31, 2025, our International RAC operations had approximately 6,300 company-operated and franchisee locations, comprised of 1,500 airport and 4,800 off airport locations in over 110 countries and jurisdictions, including Africa, Asia, Australia, Europe, the Middle East and New Zealand. 54 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
(2) Represents charges incurred under restructuring actions as defined in U.S. GAAP, excluding impairments and asset write-downs. Also includes restructuring related charges such as incremental costs incurred related to personnel reductions, litigation and closure of underperforming locations. (3) Represents unrealized (gains) losses on derivative financial instruments.
(2) Represents vehicle debt-related charges relating to the amortization of deferred financing costs and debt discounts and premiums. (3) Represents charges incurred under restructuring actions as defined in U.S. GAAP. Also includes restructuring related charges such as incremental costs incurred related to personnel reductions, litigation and closure of underperforming locations. (4) Represents unrealized (gains) losses on derivative financial instruments.
See Note 9, "Stock-Based Compensation," in Part II, Item 8 of this 2024 Annual Report. (6) Represents an increase to an existing bankruptcy-related litigation reserve recorded in September 2024, including interest that continues to accrue during each subsequent reporting period. See Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2024 Annual Report.
(7) Represents an increase to an existing bankruptcy-related litigation reserve initially recorded in September 2024, including interest that continues to accrue during each subsequent reporting period. See Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2025 Annual Report. (8) Represents Long-Lived Assets impairment charges recognized in the third quarter of 2024.
CONSOLIDATED RESULTS OF OPERATIONS - HERTZ Years Ended December 31, Percent Increase/(Decrease) ($ In millions) 2024 2023 Total revenues $ 9,049 $ 9,371 (3)% Depreciation of revenue earning vehicles and lease charges, net 3,611 2,039 77 Direct vehicle and operating expenses 5,689 5,455 4 Non-vehicle depreciation and amortization 139 149 (6) Selling, general and administrative expenses 819 962 (15) Interest expense, net: Vehicle 590 555 6 Non-vehicle 369 238 55 Interest expense, net 959 793 21 Other (income) expense, net 4 12 (65) (Gain) from the sale of non-vehicle capital assets — (162) (100) Bankruptcy-related litigation reserve 292 — NM Long-Lived Assets impairment 1,048 — NM Income (loss) before income taxes (3,512) 123 NM Income tax (provision) benefit 375 329 14 Net income (loss) $ (3,137) $ 452 NM Adjusted Corporate EBITDA (a) $ (1,541) $ 561 NM The footnote in the table above is shown in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A.
CONSOLIDATED RESULTS OF OPERATIONS - HERTZ Years Ended December 31, Percent Increase/(Decrease) ($ In millions) 2025 2024 Total revenues $ 8,504 $ 9,049 (6)% Depreciation of revenue earning vehicles and lease charges, net 1,927 3,611 (47) Direct vehicle and operating expenses 5,489 5,689 (4) Non-vehicle depreciation and amortization 117 139 (16) Selling, general and administrative expenses 957 819 17 Interest expense, net: Vehicle 608 590 3 Non-vehicle 469 369 27 Interest expense, net 1,077 959 12 Other (income) expense, net (3) 4 NM (Gain) from the sale of non-vehicle capital assets (144) — NM Legal settlement (154) — NM Bankruptcy-related litigation reserve 24 292 (92) Long-Lived Assets impairment — 1,048 (100) Income (loss) before income taxes (786) (3,512) (78) Income tax (provision) benefit 83 375 (78) Net income (loss) $ (703) $ (3,137) (78) Adjusted Corporate EBITDA (a) $ (339) $ (1,541) (78) The footnote in the table above is shown in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A.
SG&A for Americas RAC decreased $19 million in 2024 compared to 2023 due primarily to reduced advertising spend, partially offset by increased restructuring related costs and increased personnel costs.
SG&A for Americas RAC increased $22 million in 2025 compared to 2024 due primarily to increased professional fees, higher personnel costs and increased advertising spend, partially offset by lower restructuring related charges.
Results of operations and our discussion and analysis for our International RAC segment were as follows: Years Ended December 31, Percent Increase/(Decrease) ($ In millions, except as noted) 2024 2023 2024 vs. 2023 Total revenues $ 1,651 $ 1,649 —% Depreciation of revenue earning vehicles and lease charges, net $ 413 $ 264 57 Direct vehicle and operating expenses $ 971 $ 880 10 Direct vehicle and operating expenses as a percentage of total revenues 59 % 53 % Non-vehicle depreciation and amortization $ 13 $ 11 18 Selling, general and administrative expenses $ 244 $ 227 7 Selling, general and administrative expenses as a percentage of total revenues 15 % 14 % Vehicle interest expense $ 111 $ 99 12 Long-Lived Assets impairment $ 183 $ — NM Adjusted EBITDA $ 31 $ 302 (90) Transaction Days (in thousands) (b) 29,104 28,974 — Average Vehicles (in whole units) (c) 106,573 106,240 — Average Rentable Vehicles (in whole units) (c) 104,661 104,173 — Vehicle Utilization (c) 76 % 76 % Total RPD (in dollars) (d) $ 58.11 $ 58.33 — Total RPU Per Month (in whole dollars) (e) $ 1,347 $ 1,352 — Depreciation Per Unit Per Month (in whole dollars) (f) $ 331 $ 212 56 Percentage of program vehicles as of period end 26 % 18 % Footnotes to the table above are shown in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Results of operations and our discussion and analysis for our International RAC segment were as follows: Years Ended December 31, Percent Increase/(Decrease) ($ In millions, except as noted) 2025 2024 2025 vs. 2024 Total revenues $ 1,745 $ 1,651 6% Depreciation of revenue earning vehicles and lease charges, net $ 353 $ 413 (15) Direct vehicle and operating expenses $ 1,031 $ 971 6 Direct vehicle and operating expenses as a percentage of total revenues 59 % 59 % Non-vehicle depreciation and amortization $ 14 $ 13 2 Selling, general and administrative expenses $ 228 $ 244 (6) Selling, general and administrative expenses as a percentage of total revenues 13 % 15 % Vehicle interest expense $ 98 $ 111 (12) Long-Lived Assets impairment $ — $ 183 (100) Adjusted EBITDA $ 124 $ 31 NM Transaction Days (in thousands) (b) 29,813 29,104 2 Average Vehicles (in whole units) (c) 105,033 106,573 (1) Average Rentable Vehicles (in whole units) (c) 103,704 104,661 (1) Vehicle Utilization (c) 79 % 76 % Total RPD (in dollars) (d) $ 54.70 $ 54.48 — Total RPU Per Month (in whole dollars) (e) $ 1,311 $ 1,262 4 Depreciation Per Unit Per Month (in whole dollars) (f) $ 260 $ 311 (16) Percentage of program vehicles as of period end 24 % 26 % Footnotes to the table above are shown in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A.
We dispose of our non-program vehicles via auction, dealer direct wholesale channels, direct sales to third parties and retail channels. Non-program vehicles disposed of through our retail locations allow us the opportunity for ancillary revenue, such as warranty, financing and title fees.
We dispose of our non-program vehicles through a variety of channels, including dealer direct wholesale channels, retail and auction. Non-program vehicles disposed of through our retail locations allow us the opportunity for ancillary vehicle sales revenue, such as warranty, financing and title fees, with vehicle sale proceeds offsetting our depreciation of revenue earning vehicles and lease charges.
In 2023, we recognized a gain of $162 million on the sale of certain non-vehicle capital assets in our Americas RAC segment, as disclosed in Note 4, "Divestitures," in Part II, Item 8 of this 2024 Annual Report.
In 2025, we recognized a gain of $144 million on the sales of certain non-vehicle capital assets, primarily during the second and third quarters of 2025, in our Americas RAC segment, as disclosed in Note 3, "Divestitures," in Part II, Item 8 of this 2025 Annual Report.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Results of operations and our discussion and analysis for our Americas RAC segment were as follows: Years Ended December 31, Percent Increase/(Decrease) ($ In millions, except as noted) 2024 2023 2024 vs. 2023 Total revenues $ 7,398 $ 7,722 (4)% Depreciation of revenue earning vehicles and lease charges, net $ 3,198 $ 1,775 80 Direct vehicle and operating expenses $ 4,726 $ 4,582 3 Direct vehicle and operating expenses as a percentage of total revenues 64 % 59 % Non-vehicle depreciation and amortization $ 109 $ 125 (13) Selling, general and administrative expenses $ 482 $ 501 (4) Selling, general and administrative expenses as a percentage of total revenues 7 % 6 % Vehicle interest expense $ 479 $ 456 5 Long-Lived Assets impairment $ 865 $ — NM Adjusted EBITDA $ (1,357) $ 585 NM Transaction Days (in thousands) (b) 124,767 125,215 — Average Vehicles (in whole units) (c) 453,706 446,219 2 Average Rentable Vehicles (in whole units) (c) 426,017 422,485 1 Vehicle Utilization (c) 80 % 81 % Total RPD (in dollars) (d) $ 59.38 $ 61.73 (4) Total RPU Per Month (in whole dollars) (e) $ 1,449 $ 1,524 (5) Depreciation Per Unit Per Month (in whole dollars) (f) $ 588 $ 332 77 Percentage of program vehicles as of period end 7 % 1 % Footnotes to the table above are shown in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A.
Results of operations and our discussion and analysis for our Americas RAC segment were as follows: Years Ended December 31, Percent Increase/(Decrease) ($ In millions, except as noted) 2025 2024 2025 vs. 2024 Total revenues $ 6,759 $ 7,398 (9)% Depreciation of revenue earning vehicles and lease charges, net $ 1,574 $ 3,198 (51) Direct vehicle and operating expenses $ 4,461 $ 4,726 (6) Direct vehicle and operating expenses as a percentage of total revenues 66 % 64 % Non-vehicle depreciation and amortization $ 96 $ 109 (12) Selling, general and administrative expenses $ 504 $ 482 4 Selling, general and administrative expenses as a percentage of total revenues 7 % 7 % Vehicle interest expense $ 510 $ 479 6 (Gain) from the sale of non-vehicle capital assets $ (144) $ — NM Legal settlement $ (154) $ — NM Long-Lived Assets impairment $ — $ 865 (100) Adjusted EBITDA $ (172) $ (1,357) (87) Transaction Days (in thousands) (b) 119,473 124,767 (4) Average Vehicles (in whole units) (c) 422,346 453,706 (7) Average Rentable Vehicles (in whole units) (c) 400,355 426,017 (6) Vehicle Utilization (c) 82 % 80 % Total RPD (in dollars) (d) $ 56.49 $ 59.17 (5) Total RPU Per Month (in whole dollars) (e) $ 1,405 $ 1,444 (3) Depreciation Per Unit Per Month (in whole dollars) (f) $ 310 $ 587 (47) Percentage of program vehicles as of period end 11 % 7 % Footnotes to the table above are shown in the "Footnotes to the Results of Operations and Selected Operating Data by Segment Tables" section of this MD&A.
Hertz Global had income of $275 million and $163 million from the change in fair value of Public Warrants that was incremental to Hertz for the years ended December 31, 2024 and 2023, respectively.
Hertz Global had a loss of $44 million and income of $275 million from the change in fair value of Public Warrants that was incremental to Hertz for the years ended December 31, 2025 and 2024, respectively. 52 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
The following charts provide the period-over-period change for several key factors influencing our results for each of the years ended December 31, 2024 and 2023: (1) Includes impact of foreign currency exchange at average rates. (2) Results shown are in constant currency as of December 31, 2023.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) 2025 Operating Overview The following charts provide the period-over-period change for several key factors influencing our results for each of the years ended December 31, 2025 and 2024: (1) Includes impact of foreign currency exchange at average rates.
Vehicle interest expense, net increased $35 million in 2024 compared to 2023 due primarily to higher interest rates and increased debt levels. Non-vehicle interest expense, net increased $131 million in 2024 compared to 2023 due primarily to higher debt levels and higher interest rates.
Vehicle interest expense, net increased $18 million in 2025 compared to 2024 due primarily to higher average rates, partially offset by decreased debt levels and lower market rates. Non-vehicle interest expense, net increased $100 million in 2025 compared to 2024 due primarily to higher debt levels and higher average interest rates.
Depreciation of revenue earning vehicles and lease charges, net increased $1.6 billion in 2024 compared to 2023, of which $1.4 billion is attributable to our Americas RAC segment.
The decrease in total revenues resulted primarily from lower pricing and lower volume. Depreciation of revenue earning vehicles and lease charges, net decreased $1.7 billion in 2025 compared to 2024, which is primarily attributable to our Americas RAC segment.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) For more information on the above, see the discussion of our results on a consolidated basis and by segment that follows herein. In this MD&A, certain amounts in the following tables are denoted in millions.
(2) Results shown are in constant currency as of December 31, 2024. (3) The percentages shown in this chart reflect Vehicle Utilization versus period-over-period change. For more information on the above, see the discussion of our results on a consolidated basis and by segment that follows herein. In this MD&A, certain amounts in the following tables are denoted in millions.
NM - Not meaningful Year Ended December 31, 2024 Compared with Year Ended December 31, 2023 Total revenues decreased $322 million in 2024 compared to 2023, of which $324 million is attributable to our Americas RAC segment, resulting primarily from lower pricing.
NM - Not meaningful Year Ended December 31, 2025 Compared with Year Ended December 31, 2024 Total revenues decreased $544 million in 2025 compared to 2024, resulting primarily from a decrease of $639 million in our Americas RAC segment, partially offset by an increase of $94 million in our International RAC segment.
The decrease in SG&A associated with our corporate operations was due primarily to a non-cash stock-based compensation gain related to forfeitures of former chief executive officer ("CEO") awards in March 2024, decreased third-party spend and reduced non-cash stock-based compensation charges, partially offset by intercompany royalty assessment fees received from our International RAC segment and increased restructuring related costs.
The increase in SG&A associated with our corporate operations was due primarily to a non-cash stock-based compensation gain related to forfeitures of former CEO awards in March 2024, higher personnel costs and increased professional fees.
We also estimate the residual value of the applicable revenue earning vehicles at the expected time of disposal, considering factors such as make, model and options, age, physical condition, mileage, sale location, time of the year, channel disposition (e.g., auction, retail, dealer direct), historical sales experience for similar vehicles, third-party expectations of resale value and market conditions.
We also estimate the residual value of the applicable revenue earning vehicles at the expected time of disposal, considering factors such as make, model and options, age, physical condition, mileage, sale location, time of the year and market conditions. The vehicle is depreciated using a rate based on these estimates.
The change in tax in 2024 compared to 2023 is driven by lower pretax income, increases in valuation allowances in 2024 and lower EV credits generated in 2024. CONSOLIDATED RESULTS OF OPERATIONS - HERTZ GLOBAL The above discussion for Hertz also applies to Hertz Global.
The change in tax in 2025 compared to 2024 was driven primarily by lower pretax losses in 2025, non-taxable year-over-year fluctuations in fair value adjustments of the Exchangeable Note and lower tax credits in 2025, partially offset by lower valuation allowances in 2025. CONSOLIDATED RESULTS OF OPERATIONS - HERTZ GLOBAL The above discussion for Hertz also applies to Hertz Global.
RESULTS OF OPERATIONS AND SELECTED OPERATING DATA BY SEGMENT Americas RAC As of December 31, 2024, our Americas RAC operations had a total of approximately 5,000 company-operated and franchisee locations, comprised of 2,000 airport and 3,000 off airport locations. 53 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) RESULTS OF OPERATIONS AND SELECTED OPERATING DATA BY SEGMENT Americas RAC As of December 31, 2025, our Americas RAC operations had a total of approximately 4,600 company-operated and franchisee locations, comprised of 2,000 airport and 2,600 off airport locations.
For 2024, primarily includes certain IT-related charges, cloud computing costs and certain storm-related vehicle damages, partially offset by a loss recovery settlement and certain litigation settlements. For 2023, primarily includes certain IT-related charges, certain storm-related vehicle damages and certain professional fees and charges related to the settlement of bankruptcy claims, partially offset by a loss recovery settlement.
For 2025, primarily includes a pension plan settlement reserve adjustment, a one-time settlement agreement to restructure an IT contract, certain IT-related charges, cloud computing costs, an unfavorable litigation ruling and certain concession-related adjustments. For 2024, primarily includes certain IT-related charges, cloud computing costs and certain storm-related vehicle damages, partially offset by a loss recovery settlement and certain litigation settlements.
Vehicle interest expense for Americas RAC increased $23 million in 2024 compared to 2023 due primarily to higher average interest rates resulting primarily from the issuances of new HVF III Series Notes in 2024 and higher 54 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Vehicle interest expense for International RAC decreased $13 million in 2025 compared to 2024 due primarily to lower debt levels and lower market rates. 55 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Discussions of our results of operations, liquidity and capital resources for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found under Part II, Item 7 of our 2023 Form 10-K, which is available on the SEC's website (www.sec.gov) or indirectly through our website (www.hertz.com).
Discussions of our results of operations, liquidity and capital resources for the year ended December 31, 2024 compared to the year ended December 31, 2023 can be found under Part II, Item 7 of 50 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Depreciation of revenue earning vehicles and lease charges, net for Americas RAC increased $1.4 billion in 2024 compared to 2023 due primarily to (i) deterioration in residual values at the expected time of disposal, (ii) decreased holding periods resulting in part from the acceleration of our rental fleet rotation and (iii) per unit losses recognized on vehicle dispositions in 2024 compared to per unit gains recognized in 2023.
Depreciation of revenue earning vehicles and lease charges, net for International RAC decreased $60 million in 2025 compared to 2024 due primarily to (i) per unit gains recognized on vehicle dispositions in 2025 compared to per unit losses recognized in the same period in 2024 and (ii) changes in fleet mix.
See Note 12, "Financial Instruments," in Part II, Item 8 of this 2024 Annual Report. (4) Represents the gain on sale of certain non-vehicle capital assets sold in 2023. See Note 4, "Divestitures," in Part II, Item 8 of this 2024 Annual Report. (5) Represents former CEO awards forfeited in March 2024.
In 2025, also includes gains (losses) related to the fair value of the Exchange Features 2029 and the Exchange Feature 2030. See Note 12, "Financial Instruments," in Part II, Item 8 of this 2025 Annual Report. (5) Represents the gains on sales of certain non-vehicle capital assets sold in 2025 and 2023.
(7) Represents impairment charges recognized for certain long-lived assets in the third quarter of 2024. See Note 3, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2024 Annual Report. (8) Represents miscellaneous items.
See Note 4, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2025 Annual Report. (9) Represents former CEO awards forfeited in March 2024. See Note 9, "Stock-Based Compensation," in Part II, Item 8 of this 2025 Annual Report. (10) Represents miscellaneous items.
Depreciation of revenue earning vehicles and lease charges, net increased due primarily to (i) deterioration in the residual values at the expected time of disposal, (ii) decreased holding periods resulting from the acceleration of our rental fleet rotation and (iii) per unit losses recognized on vehicle dispositions during 2024 compared to per unit gains recognized in 2023.
Depreciation of revenue earning vehicles and lease charges, net decreased due primarily to (i) impacts from our fleet refresh reducing the capital cost of newly acquired vehicles and strengthening of residual values at the expected time of disposal resulting from market improvements, (ii) per unit gains on vehicle dispositions recognized in 2025 compared to per unit losses recognized in the same period in 2024 resulting in part from the disposition of vehicles through a more optimized channel mix, (iii) lower Average Vehicles and (iv) write-downs on the carrying values of the EVs classified as held for sale in the first half of 2024.
See Note 3, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2024 Annual Report for further details.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) International RAC recognized an impairment charge of $183 million in 2024 associated with its revenue earning vehicles. See Note 4, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2025 Annual Report for further details.
Vehicle interest expense for International RAC increased $12 million in 2024 compared to 2023 due primarily to higher debt levels and higher market interest rates. International RAC recognized an impairment charge of $183 million in 2024 associated with its revenue earning vehicles.
Vehicle interest expense for Americas RAC increased $31 million in 2025 compared to 2024 due primarily to higher average rates due in part to the issuance of the HVF III 2025 Notes, partially offset by lower market rates and lower debt levels.
Americas RAC International RAC Years Ended December 31, 2024 2023 2024 2023 Transaction Days (in thousands) 124,767 125,215 29,104 28,974 Average Rentable Vehicles (in whole units) 426,017 422,485 104,661 104,173 Number of days in period (in whole units) 366 365 366 365 Available Car Days (in thousands) 155,935 154,272 38,321 38,061 Vehicle Utilization 80 % 81 % 76 % 76 % (d) Total RPD is calculated as revenues with all periods adjusted to eliminate the effect of fluctuations in foreign currency exchange rates ("Total Revenues - adjusted for foreign currency"), divided by the total number of Transaction Days.
Americas RAC International RAC Years Ended December 31, 2025 2024 2025 2024 Transaction Days (in thousands) 119,473 124,767 29,813 29,104 Average Rentable Vehicles (in whole units) 400,355 426,017 103,704 104,661 Number of days in period (in whole units) 365 366 365 366 Available Car Days (in thousands) 146,157 155,935 37,885 38,321 Vehicle Utilization 82 % 80 % 79 % 76 % 57 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
DOE for International RAC increased $91 million in 2024 compared to 2023 due primarily to higher personnel costs, increased self-insurance liabilities as a result of adverse experience and case development, increased collision and damage costs and increased vehicle in-fleeting costs.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) DOE for Americas RAC decreased $265 million in 2025 compared to 2024 due primarily to lower volume, reduced self-insurance liabilities as a result of adverse experience and case development and decreased collision and damage charges, partially offset by increased facility rent expense resulting in part from sale leaseback transactions in 2025.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) SG&A decreased $143 million in 2024 compared to 2023 driven primarily by decreases of $141 million and $19 million associated with our corporate operations and Americas RAC segment, respectively, partially offset by an increase of $16 million in our International RAC segment.
Non-vehicle depreciation and amortization decreased $23 million in 2025 compared to 2024, resulting from decreases of $13 million and $10 million associated with our Americas RAC segment and corporate operations, 51 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) respectively.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Depreciation of revenue earning vehicles and lease charges, net for International RAC increased $150 million in 2024 compared to 2023 due primarily to (i) per unit losses recognized on vehicle dispositions in 2024 compared to per unit gains recognized in 2023, (ii) deterioration in the residual values at the expected time of disposal and (iii) decreased holding periods resulting in part from the acceleration of our rental fleet rotation.
Depreciation of revenue earning vehicles and lease charges, net for Americas RAC decreased $1.6 billion in 2025 compared to 2024 due primarily to (i) impacts from our fleet refresh reducing the capital cost of newly acquired vehicles and strengthening of residual values at the expected time of disposal resulting from market improvements, (ii) per unit gains on vehicle dispositions recognized in 2025 compared to per unit losses recognized in the same period in 2024 resulting in part from the disposition of vehicles through a more optimized channel mix, (iii) lower Average Vehicles and (iv) write-downs on the carrying values of the EVs classified as held for sale in 2024. 53 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
SG&A for International RAC increased $16 million in 2024 compared to 2023 due primarily to increased restructuring related costs and higher personnel costs, partially offset by lower intercompany royalty assessment fees paid to our corporate operations.
SG&A for International RAC decreased $16 million in 2025 compared to 2024 due primarily to decreased restructuring related charges, partially offset by expenses incurred related to an unfavorable litigation ruling in the third quarter of 2025.
During 2024, there was a $1.1 billion decrease in the cash used in investing activities period over period due primarily to a $1.2 billion decrease in revenue earning vehicle expenditures, net, partially offset by $168 million of net proceeds received in 2023 from the sale of certain non-vehicle capital assets as disclosed in Note 4, "Divestitures," in Part II, Item 8 of this 2024 Annual Report.
Americas RAC recognized a gain of $144 million on the sale of certain non-vehicle capital assets, primarily during the second and third quarters of 2025, as disclosed in Note 3, "Divestitures," in Part II, Item 8 of this 2025 Annual Report.
Our business requires significant expenditures for vehicles, and, as such, we require substantial liquidity to finance such expenditures. Our strategy is focused on excellence in execution of the basics. We are committed to delivering unmatched customer experiences, optimizing fleet economics and building on our leadership in ride share.
Our business requires significant expenditures for vehicles, and, as such, we require substantial liquidity to finance such expenditures. Through our "Back-to-Basics" roadmap, we are committed to executing a comprehensive strategy to transform our business, anchored by three financial pillars: disciplined fleet management, revenue optimization and rigorous cost control.
Removed
However, during the effective period of Amendment No. 8, as disclosed in Note 7, "Debt," in Part II, Item 8 of this 2024 Annual Report, the repurchase of Hertz Global common stock is not permitted between April 16, 2024 through April 1, 2025.
Added
Building on our brand strength, global network and fleet management expertise, we remain committed to operational excellence and keeping customers central to everything we do. We have strengthened our fleet by refining our capabilities by sourcing vehicles strategically, deploying them efficiently and monetizing them effectively.
Removed
Between inception and December 31, 2023, a total of 66,684,169 shares of Hertz Global's common stock were repurchased in open-market transactions under the 2022 Share Repurchase Program at an average share price of $16.88 for an aggregate purchase price of $1.1 billion, excluding applicable excise tax. There were no share repurchases during the year ended December 31, 2024.
Added
Our approach balances disciplined execution today with systematic innovation for tomorrow, leveraging industry experience to adapt to evolving market dynamics and position us for sustainable growth in the future of mobility.
Removed
Continuing to build on our brand strength, global network and global fleet management capabilities, while also combining those efforts with investments in technology, shared mobility and a digital-first customer experience, will allow us to deliver on the basics and remain a central player in the modern mobility ecosystem.
Added
The planned holding period of our revenue earning vehicles as of December 31, 2025, typically averaged 27 months; however, certain vehicles in our fleet may have fallen above or below our average planned holding period.
Removed
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) 2024 Operating Overview As of December 31, 2024, the sale of the EV Disposal Groups was substantially complete.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) our 2024 Form 10-K, which is available on the SEC's website (www.sec.gov) or indirectly through our website (www.hertz.com).
Removed
During the year ended December 31, 2024, we incurred incremental depreciation charges, primarily in the first half of 2024, of $175 million for the write-down on the vehicles in the EV Disposal Groups, of which $164 million and $11 million are associated with our Americas RAC and International RAC segments, respectively, and $48 million for losses incurred on the vehicles sold, primarily in our Americas RAC segment.
Added
DOE decreased $200 million in 2025 compared to 2024 with a decrease of $265 million in our Americas RAC segment, partially offset by an increase of $60 million in our International RAC segment. The decrease in DOE was due primarily to lower volume.

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Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

25 edited+110 added−12 removed30 unchanged
Biggest changeCash inflow (cash outflow) Years Ended December 31, 2024 vs. 2023 ($ in millions) 2024 2023 $ Change % Change Americas RAC $ (60) $ 52 $ (112) NM International RAC (13) (19) 6 (32) Corporate (9) (40) 31 NM Total $ (82) $ (7) $ (75) NM NM - Not meaningful Year Ended December 31, 2024 Compared with Year Ended December 31, 2023 In 2024, proceeds for non-vehicle capital assets decreased by $158 million compared to 2023, primarily in our Americas RAC segment, resulting from the sale of certain non-vehicle capital assets in 2023 as disclosed in Note 4, "Divestitures," in Part II, Item 8 of this 2024 Annual Report.
Biggest changeCash inflow (cash outflow) Years Ended December 31, 2025 vs. 2024 ($ in millions) 2025 2024 $ Change % Change Americas RAC $ 95 $ (60) $ 155 NM International RAC 11 (13) 24 NM Corporate (3) (9) 6 (67) Total $ 103 (82) $ 185 NM NM - Not meaningful Year Ended December 31, 2025 Compared with Year Ended December 31, 2024 The change in non-vehicle capital asset expenditures, net in 2025 compared to 2024 is primarily due to a $177 million increase in proceeds resulting largely from the disposition of certain non-vehicle capital assets in our Americas RAC segment, as disclosed in Note 3, "Divestitures," in Part II, Item 8 of this 2025 Annual Report.
See Note 7, "Debt," in Part II, Item 8 of this 2024 Annual Report for further details. (2) Represents fleet purchases where contracts have been signed or are pending with committed orders under the terms of such agreements. We expect purchases under these agreements will be financed primarily through the issuance of vehicle debt.
See Note 7, "Debt," in Part II, Item 8 of this 2025 Annual Report for further details. (2) Represents fleet purchases where contracts have been signed or are pending with committed orders under the terms of such agreements. We expect purchases under these agreements will be financed primarily through the issuance of vehicle debt.
An impairment is deemed to exist if the carrying value of goodwill or indefinite-lived intangible assets exceed their fair value as determined using Level 3 inputs, as described in Part II, Item 8 of this 2024 Annual Report, under the U.S. GAAP fair value hierarchy.
An impairment is deemed to exist if the carrying value of goodwill or indefinite-lived intangible assets exceed their fair value as determined using Level 3 inputs, as described in Part II, Item 8 of this 2025 Annual Report, under the U.S. GAAP fair value hierarchy.
EMPLOYEE RETIREMENT BENEFITS Pension We sponsor defined benefit pension plans worldwide. Pension obligations give rise to expenses that are dependent on assumptions discussed in Note 8, "Employee Retirement Benefits," in Part II, Item 8 of this 2024 Annual Report.
EMPLOYEE RETIREMENT BENEFITS Pension We sponsor defined benefit pension plans worldwide. Pension obligations give rise to expenses that are dependent on assumptions discussed in Note 8, "Employee Retirement Benefits," in Part II, Item 8 of this 2025 Annual Report.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our discussion and analysis of financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our discussion and analysis of financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S.
For additional discussion of our critical accounting policies, as well as our significant accounting policies, see Note 2, "Significant Accounting Policies," in Part II, Item 8 of this 2024 Annual Report. Revenue Earning Vehicles Our principal assets are revenue earning vehicles, which represented approximately 55% of our total assets as of December 31, 2024.
For additional discussion of our critical accounting policies, as well as our significant accounting policies, see Note 2, "Significant Accounting Policies," in Part II, Item 8 of this 2025 Annual Report. Revenue Earning Vehicles Our principal assets are revenue earning vehicles, which represented approximately 56% of our total assets as of December 31, 2025.
Revenue earning vehicles consist of vehicles utilized in our vehicle rental operations. For the year ended December 31, 2024, 14% of the vehicles purchased for our combined U.S. and International vehicle rental fleets were vehicles purchased under repurchase or guaranteed depreciation programs with vehicle manufacturers, or program vehicles.
Revenue earning vehicles consist of vehicles utilized in our vehicle rental operations. For the year ended December 31, 2025, 26% of the vehicles purchased for our combined U.S. and International vehicle rental fleets were vehicles purchased under repurchase or guaranteed depreciation programs with vehicle manufacturers, or program vehicles.
The reviews of fair value involve judgment and estimates, including projected revenues, projected cash flows, long-term growth rates, royalty rates and discount rates. For goodwill, we determine the fair value using an income approach based on the discounted cash flows of each reporting unit.
The reviews of fair value involve judgment and estimates, including projected revenues, projected cash flows, long-term growth rates, royalty rates and discount rates, which we deem reasonable for this purpose. For goodwill, we determine the fair value using an income approach based on the discounted cash flows of each reporting unit.
(3) Represents agreements to purchase goods or services that are legally binding on us and that specify all significant terms, including fixed or minimum quantities; fixed, minimum or variable price provisions; and the approximate timing of the transaction, as well as liabilities for uncertain tax positions and other liabilities, and excludes any obligations to employees.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) (3) Represents agreements to purchase goods or services that are legally binding on us and that specify all significant terms, including fixed or minimum quantities; fixed, minimum or variable price provisions; and the approximate timing of the transaction, as well as liabilities for uncertain tax positions and other liabilities, and excludes any obligations to employees.
Purchase obligations include $31 million representing our tax liability for uncertain tax positions and related net accrued interest and penalties. The table excludes pension benefit obligations as disclosed in Note 8, "Employee Retirement Benefits," in Part II, Item 8 of this 2024 Annual Report. 68 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Purchase obligations include $31 million representing our tax liability for uncertain tax positions and related net accrued interest and penalties. The table excludes pension benefit obligations as disclosed in Note 8, "Employee Retirement Benefits," in Part II, Item 8 of this 2025 Annual Report.
If our expectations of the operating results, both in magnitude or timing, do not materialize, or if our weighted average cost of capital increases, we may be required to record goodwill and indefinite-lived intangible asset impairment charges, which could be material.
If our expectations of the operating results, both in magnitude or timing, do not materialize, or if our weighted average cost of capital increases, we may be required to record goodwill and indefinite-lived intangible asset impairment charges, which could be material. 71 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
The funded status (i.e., the dollar amount by which the projected benefit obligations exceeded the market value of pension plan assets) of the Hertz Retirement Plan, as defined in Note 8, "Employee Retirement Benefits," in Part II, Item 8 of this 2024 Annual Report, increased in December 31, 2024 compared with December 31, 2023 due primarily to actuarial gains resulting from increased discount rates and an increase in plan settlements.
The funded status (i.e., the dollar amount by which the projected benefit obligations exceeded the market value of pension plan assets) of the Hertz Retirement Plan, as defined in Note 8, "Employee Retirement Benefits," in Part II, Item 8 of this 2025 Annual Report, increased in December 31, 2025 compared with December 31, 2024 due primarily to increased returns on plan assets.
Income Taxes Our income tax expense, deferred tax assets and liabilities, and liabilities for unrecognized tax benefits reflect management’s best estimate of current and future taxes to be paid. We are subject to income taxes in the U.S. and numerous foreign jurisdictions. Significant judgments and estimates are required in the determination of the consolidated income tax expense.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Income Taxes Our income tax expense, deferred tax assets and liabilities, and liabilities for unrecognized tax benefits reflect management’s best estimate of current and future taxes to be paid. We are subject to income taxes in the U.S. and numerous foreign jurisdictions.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS Indemnification Obligations In the ordinary course of business, we execute contracts involving indemnification obligations customary in the relevant industry and indemnifications specific to a transaction such as the sale of a business.
OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS Indemnification Obligations In the ordinary course of business, we execute contracts involving indemnification obligations customary in the relevant industry and indemnifications specific to a transaction such as the sale of a business.
Our 2024 worldwide net periodic pension expense included in the accompanying consolidated statement of operations for the year ended December 31, 2024 was $9 million compared to $11 million in 2023 resulting in part from decreased interest costs.
Our 2025 worldwide net periodic pension expense included in the accompanying consolidated statement of operations for the year ended December 31, 2025 was $6 million compared to $9 million in 2024 resulting in part from curtailment gains associated with our international plans.
We record net deferred tax assets to the extent we believe these assets will more likely than not be realized.
Significant judgments and estimates are required in the determination of the consolidated income tax expense. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized.
Our cash flow projections represent management's most recent planning assumptions, which are based on a combination of industry outlooks, views on general economic conditions, our expected pricing plans and expected future savings.
The discount rate utilized for each reporting unit is indicative of the return an investor would expect to receive for investing in such a business. Our cash flow projections represent management's most recent planning assumptions, which are based on a combination of industry outlooks, views on general economic conditions, our expected pricing plans and expected future savings.
These differences will be reflected as increases or decreases to income tax expense in the period in which the change in judgement occurs. Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, see Note 2, "Significant Accounting Policies—Recently Issued Accounting Pronouncements," in Part II, Item 8 of this 2024 Annual Report. 72 Table of Contents HERTZ GLOBAL HOLDINGS, INC.
Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, see Note 2, "Significant Accounting Policies—Recently Issued Accounting Pronouncements," in Part II, Item 8 of this 2025 Annual Report. 72 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) The table below sets forth non-vehicle capital asset expenditures, net of disposal proceeds, by segment.
AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Non-Vehicle Capital Asset Expenditures and Disposals The table below sets forth our non-vehicle capital asset expenditures, and related disposal proceeds from non-vehicle capital assets disposed of or to be disposed of for the annual periods shown.
The level of 2025 and future contributions will vary and is dependent on a number of factors including investment returns, interest rate fluctuations, plan demographics, funding regulations and the results of the final actuarial valuation. 69 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
For the international plans, we anticipate contributing approximately $4 million during 2026. The level of 2026 and future contributions will vary and is dependent on a number of factors including investment returns, interest rate fluctuations, plan demographics, funding regulations and the results of the final actuarial valuation.
CONTRACTUAL AND OTHER OBLIGATIONS The following table details our material cash requirements for our contractual and other obligations as of December 31, 2024: Payments Due by Period (In millions) Total 2025 2026 to 2027 2028 to 2029 After 2029 Vehicles: Debt obligation $ 11,280 $ 1,697 $ 8,321 $ 1,199 $ 63 Interest on debt (1) 982 496 397 89 — Non-Vehicle: Debt obligation 5,170 18 711 4,441 — Interest on debt (1) 1,731 430 764 537 — Minimum fixed obligations for operating leases 3,419 561 847 581 1,430 Commitments to purchase vehicles (2) 6,586 6,586 — — — Purchase obligations and other (3) 314 119 149 15 31 Total $ 29,482 $ 9,907 $ 11,189 $ 6,862 $ 1,524 (1) Amounts represent the estimated commitment fees and interest payments based on the principal amounts, minimum non-cancelable maturity dates and interest rates on the debt as of December 31, 2024.
CONTRACTUAL AND OTHER OBLIGATIONS The following table details our material cash requirements for our contractual and other obligations as of December 31, 2025: Payments Due by Period (In millions) Total 2026 2027 to 2028 2029 to 2030 After 2030 Vehicles: Debt obligation $ 11,679 $ 2,901 $ 6,418 $ 1,902 $ 458 Interest on debt (1) 1,250 544 538 162 6 Non-Vehicle: Debt obligation 5,524 284 2,288 2,946 6 Interest on debt (1) 1,496 439 739 295 23 Minimum fixed obligations for operating leases 4,601 610 949 613 2,429 Commitments to purchase vehicles (2) 9,394 9,394 — — — Purchase obligations and other (3) 496 327 148 3 18 Total $ 34,440 $ 14,499 $ 11,080 $ 5,921 $ 2,940 (1) Amounts represent the estimated commitment fees and interest payments based on the principal amounts, minimum non-cancelable maturity dates and interest rates on the debt as of December 31, 2025.
These purchases are subject to vehicle manufacturers satisfying their performance commitments under such agreements.
These purchases are subject to vehicle manufacturers satisfying their performance commitments under such agreements. 68 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
These represent an estimate for both reported accident claims not yet paid, and claims incurred but not yet reported and are recorded on an undiscounted basis. Reserve requirements are based on actuarially determined estimates using historical claims experience. The adequacy of the liability is monitored quarterly based on evolving accident claim history.
Reserve requirements are based on actuarially determined estimates using historical claims experience. The adequacy of the liability is monitored quarterly based on evolving accident claim history. If our estimates change or if actual results differ from these assumptions, the amount of the recorded liability is adjusted to reflect these results.
Changes in projected residual values or holding periods could cause a material change in our estimates of non-program depreciation expense. Long-Lived Assets Our long-lived assets consist primarily of revenue earning vehicles, ROU assets and property and equipment. We make estimates about the expected economic lives, projected residual values and the potential for impairment.
Changes in projected residual values or holding periods could cause a material change in our estimates of non-program depreciation expense. 70 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
The discount rate utilized for each reporting unit is indicative of the return 71 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) an investor would expect to receive for investing in such a business.
We contributed $9 million to the Hertz Retirement Plan during 2025, 69 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) and we do not anticipate contributing to the Hertz Retirement Plan during 2026.
Removed
In 2024, expenditures for non-vehicle capital assets decreased by $83 million compared to 2023, primarily in our Americas RAC segment and corporate operations, driven in part by reduced location refurbishment spend and a non-recurring capital outlay for certain non-vehicle prepaids in 2023.
Added
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) (d) Total RPD is calculated as revenues, with all periods adjusted to eliminate the effect of fluctuations in foreign currency exchange rates ("Total Revenues - adjusted for foreign currency"), divided by the total number of Transaction Days.
Removed
We contributed $9 million to the Hertz Retirement Plan during 2024, and we do not anticipate contributing to the Hertz Retirement Plan during 2025. For the international plans, we anticipate contributing approximately $3 million during 2025.
Added
Our management believes eliminating the effect of fluctuations in foreign currency exchange rates is useful in analyzing underlying trends.
Removed
We amortize long-lived assets using the straight-line method over the estimated economic lives. Long-lived assets are 70 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Added
The calculation of Total RPD is shown below: Americas RAC International RAC Years Ended December 31, ($ in millions, except as noted) 2025 2024 2025 2024 Revenues $ 6,759 $ 7,398 $ 1,745 $ 1,651 Foreign currency adjustment (1) (10) (16) (114) (65) Total Revenues-adjusted for foreign currency $ 6,749 $ 7,382 $ 1,631 $ 1,586 Transaction Days (in thousands) 119,473 124,767 29,813 29,104 Total RPD (in dollars) $ 56.49 $ 59.17 $ 54.70 $ 54.48 (1) Based on December 31, 2024 foreign currency exchange rates for all periods presented.
Removed
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable.
Added
(e) Total RPU Per Month is calculated as Total Revenues - adjusted for foreign currency divided by the Average Rentable Vehicles in each period and then divided by the number of months in the period reported.
Removed
Factors which could be indicators of impairment include, but are not limited to, (i) significant decrease in market prices of the assets, (ii) current period operating or cash flow losses or a projection or forecast that demonstrates continuing losses and (iii) significant changes in the estimated useful lives.
Added
Americas RAC International RAC Years Ended December 31, ($ in millions, except as noted) 2025 2024 2025 2024 Total Revenues-adjusted for foreign currency $ 6,749 $ 7,382 $ 1,631 $ 1,586 Average Rentable Vehicles (in whole units) 400,355 426,017 103,704 104,661 Total revenue per unit (in whole dollars) $ 16,856 $ 17,328 $ 15,726 $ 15,150 Number of months in period (in whole units) 12 12 12 12 Total RPU Per Month (in whole dollars) $ 1,405 $ 1,444 $ 1,311 $ 1,262 (f) Depreciation Per Unit Per Month represents the amount of average depreciation expense and lease charges, per vehicle per month and is calculated as depreciation of revenue earning vehicles and lease charges, net, with all periods adjusted to eliminate the effect of fluctuations in foreign currency exchange rates, divided by the Average Vehicles in each period, which is determined using a simple average of the number of vehicles at the beginning and end of a period, and then dividing by the number of months in the period reported.
Removed
Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of an impairment loss for long-lived assets that management expects to hold and use is based on the estimated fair value of the asset.
Added
Our management believes eliminating the effect of fluctuations in foreign currency exchange rates is useful in analyzing underlying trends.
Removed
Long-lived assets to be disposed of are reported at the lower of carrying value or estimated fair value less costs to sell.
Added
The calculation of Depreciation Per Unit Per Month is shown below: Americas RAC International RAC Years Ended December 31, ($ in millions, except as noted) 2025 2024 2025 2024 Depreciation of revenue earning vehicles and lease charges, net (1) $ 1,574 $ 3,198 $ 353 $ 413 Foreign currency adjustment (2) (1) (2) (25) (16) Adjusted depreciation of revenue earning vehicles and lease charges $ 1,573 $ 3,196 $ 328 $ 397 Average Vehicles (in whole units) 422,346 453,706 105,033 106,573 Adjusted depreciation of revenue earning vehicles and lease charges divided by Average Vehicles (in whole dollars) $ 3,724 $ 7,044 $ 3,123 $ 3,729 Number of months in period (in whole units) 12 12 12 12 Depreciation Per Unit Per Month (in whole dollars) $ 310 $ 587 $ 260 $ 311 (1) Reflects four months of depreciation at post-impairment rates for the year ended December 31, 2024.
Removed
During the third quarter of 2024, at the conclusion of our historical peak rental season, there was a reduction in the cash flow projections in our Americas RAC and International RAC segments, indicating that the carrying values of their long-lived assets may not be recoverable.
Added
See Note 4, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2025 Annual Report. (2) Based on December 31, 2024 foreign currency exchange rates for all periods presented. 58 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Removed
The reduction was largely attributed to the acceleration of the rental fleet rotation in our segments, where shortening the useful life reduced the potential future cash flows expected to be earned from the fleet. Operating cash flow projections also deteriorated from delayed timing of operating cost improvements and longer timeframes associated with revenue maximization initiatives.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) LIQUIDITY AND CAPITAL RESOURCES Our U.S. and international operations are funded by cash provided by operating activities and by extensive financing arrangements in the U.S. and internationally.
Removed
As a result, we tested the recoverability of our long-lived assets in our Americas RAC and International RAC segments and determined that an impairment existed, which resulted in recognition of a total impairment charge of $1.0 billion, of which $923 million and $125 million were associated with our revenue earning vehicles and ROU assets, respectively.
Added
Cash and Cash Equivalents As of December 31, 2025, we had $565 million of cash and cash equivalents and $602 million of restricted cash and cash equivalents. As of December 31, 2025, $231 million of cash and cash equivalents and $89 million of restricted cash and cash equivalents were held by our subsidiaries outside of the U.S.
Removed
Further changes in market conditions or the performance of our long-lived assets could result in an additional impairment charge. See Note 3, "Long-Lived Assets Impairment," in Part II, Item 8 of this 2024 Annual Report for additional information. Self-insured Liabilities Self-insured liabilities on our consolidated balance sheets primarily include public liability, property damage and liability insurance supplement.
Added
We continue to assert non-permanent reinvestment of foreign earnings that give rise to excess cash, provided such cash can be remitted in a tax efficient manner.
Removed
If our estimates change or if actual results differ from these assumptions, the amount of the recorded liability is adjusted to reflect these results. During the year ended December 31, 2024, we experienced increased self-insurance liabilities as a result of adverse experience and case development.
Added
We believe that cash and cash equivalents generated by our operations and cash received on the disposal of vehicles, together with amounts available under various liquidity facilities and refinancing options available to us in the capital markets, will be sufficient to fund our operating activities and obligations for the next twelve months and for the foreseeable future thereafter.
Added
Cash Flows - Hertz As of December 31, 2025 and 2024, Hertz had cash and cash equivalents of $565 million and $591 million, respectively, and restricted cash and cash equivalents of $602 million and $541 million, respectively.
Added
The following table summarizes the net change in cash and cash equivalents and restricted cash and cash equivalents for the periods shown: Years Ended December 31, 2025 vs. 2024 (In millions) 2025 2024 $ Change Cash provided by (used in): Operating activities $ 1,628 $ 2,226 $ (598) Investing activities (1,995) (2,929) 934 Financing activities 370 655 (285) Effect of exchange rate changes 32 (26) 58 Net change in cash and cash equivalents and restricted cash and cash equivalents $ 35 $ (74) $ 109 Year Ended December 31, 2025 Compared with Year Ended December 31, 2024 During 2025, cash flows from operating activities decreased $598 million period over period due primarily to a $190 million change in net income, as adjusted for non-cash and non-operating items and a $408 million change in working capital accounts.
Added
Cash flows from working capital accounts decreased due primarily to an increase to an existing bankruptcy-related litigation reserve recorded in the third quarter of 2024 and an increase in self-insurance liabilities as a result of adverse experience and case development in 2024, partially offset by a reduction in value added tax ("VAT") receivables due primarily to VAT refunds received in 2025.
Added
Our primary investing activities relate to the acquisition and disposal of revenue earning vehicles. During 2025, there was a $934 million decrease in the cash used in investing activities period over period due primarily to a $749 million decrease in revenue earning vehicle expenditures, net.
Added
The decrease in cash used by revenue earning vehicle expenditures, net, resulted primarily from per unit gains on vehicle dispositions recognized in 2025 compared to per unit losses recognized in 2024, higher fleet prepayments in 2024 due in part to our fleet rotation initiatives and changes to fleet working capital due to timing, partially offset by increased vehicle acquisitions.
Added
Cash used in investing activities also decreased period over period due to $177 million of increased proceeds primarily 59 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) from the disposition of certain non-vehicle capital assets in 2025 compared to 2024, as disclosed in Note 3, "Divestitures," in Part II, Item 8 of this 2025 Annual Report. Net financing cash inflows were $370 million in the 2025 compared to $655 million in 2024.
Added
The $285 million decrease in cash inflows is due primarily to a $1.3 billion decrease in net proceeds from non-vehicle debt resulting from fewer issuances of non-vehicle debt in 2025 compared to 2024.
Added
Cash flows from financing activities were also impacted by an increase of $1.1 billion in net proceeds from vehicle debt largely resulting from more issuances of HVF III medium term notes in 2025 compared to 2024.
Added
Cash Flows - Hertz Global As of December 31, 2025 and 2024, Hertz Global had cash and cash equivalents of $565 million and $592 million, respectively, and restricted cash and cash equivalents of $602 million and $541 million, respectively.
Added
The following table summarizes the net change in cash and cash equivalents and restricted cash and cash equivalents for Hertz Global for the periods shown: Years Ended December 31, 2025 vs. 2024 (In millions) 2025 2024 $ Change Cash provided by (used in): Operating activities $ 1,625 $ 2,224 $ (599) Investing activities (1,995) (2,929) 934 Financing activities 372 658 (286) Effect of exchange rate changes 32 (26) 58 Net change in cash and cash equivalents and restricted cash and cash equivalents $ 34 $ (73) $ 107 Fluctuations in operating, investing and financing cash flows from period to period were due to the same factors as those disclosed for Hertz above, with the exception of any cash inflows or outflows related to the issuance or repurchase of our common stock and the exercise of Public Warrants.
Added
See Note 17, "Equity and Earnings (Loss) Per Common Share – Hertz Global," and Note 18, "Public Warrants – Hertz Global," in Part II, Item 8 of this 2025 Annual Report. Public Warrants As of December 31, 2025, approximately 82,700,000 Public Warrants remain outstanding with an exercise price of $13.61.
Added
As of December 31, 2025, there has been approximately 6,300,000 Public Warrants exercised since their original issuance in June 2021. The outstanding warrants are exercisable through June 30, 2051. As of December 31, 2025, the exercise price is $13.61.
Added
At-the-Market ("ATM") Equity Offering Program In May 2025, Hertz Global filed a Form S-3 Registration Statement as well as a prospectus supplement covering the offering, issuance and sale of up to a maximum aggregate offering price of $250 million shares of Hertz Global common stock par value $0.01 per share that may be issued and sold from time to time under an equity distribution agreement with various banking institutions, acting as the Company's agents, through an ATM offering program (the "ATM Program").
Added
As of December 31, 2025, no shares of Hertz Global common stock had been sold under the ATM Program. 60 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) Debt Financing See Note 7, "Debt," in Part II, Item 8 of this 2025 Annual Report for information on our outstanding debt obligations and our borrowing capacity and availability under our revolving credit facilities as of December 31, 2025.
Added
Cash paid for interest on non-vehicle debt during 2025 compared to 2024 was $463 million and $287 million, respectively. The $176 million increase in cash paid for non-vehicle debt interest is due primarily to higher debt levels in 2025 resulting from the issuance of the First Lien Senior Notes in 2024.
Added
Cash paid for interest on vehicle debt during 2025 compared to 2024 was $541 million and $511 million, respectively.
Added
The $30 million increase in cash paid for vehicle debt interest is due primarily to higher debt levels resulting from the issuances of HVF III medium term notes in 2025 and the second half of 2024, partially offset by lower debt levels and interest rates associated with the European ABS.
Added
A substantial portion of our liquidity requirements arise from servicing our indebtedness, funding our operations, including purchases of revenue earning vehicles, and funding non-vehicle capital expenditures. We expect to maintain heightened levels of indebtedness into 2026. For a discussion of the risks associated with our high leverage, see Item 1A, "Risk Factors" in this 2025 Annual Report.
Added
Our available corporate liquidity, which excludes unused commitments under our vehicle debt, was as follows: (In millions) As of December 31, 2025 As of December 31, 2024 Cash and cash equivalents $ 565 $ 591 Availability under the First Lien RCF 924 1,251 Corporate liquidity (1) $ 1,489 $ 1,842 (1) In January 2026, we made a payment for the stipulated amount of $346 million in connection with the case captioned Wells Fargo Bank, National Association v.
Added
The Hertz Corporation, et. al., as further disclosed in Note 15, "Contingencies and Off-Balance Sheet Commitments," in Part II, Item 8 of this 2025 Annual Report. The payment was funded through borrowings under the First Lien RCF.
Added
Non-vehicle Debt Approximately $284 million of our outstanding non-vehicle debt is scheduled to mature during the twelve months following the issuance of this 2025 Annual Report.
Added
We have reviewed our debt facilities for non-vehicle debt and determined that it is probable that we will be able, and have the intent, to refinance these facilities at such times as we determine appropriate prior to maturity. Significant financing activities during the year ended December 31, 2025 for our non-vehicle debt are below.
Added
First Lien Credit Agreement / First Lien RCF On April 1, 2025, an amendment to the First Lien Credit Agreement, which was entered into in April 2024 ("Amendment No. 8"), expired.
Added
Amendment No. 8 contained a minimum liquidity covenant of $400 million for each month ending in the second and third quarters of 2024 and $500 million for each month ending in the fourth quarter of 2024 and the first quarter of 2025.
Added
Amendment No. 8 also temporarily amended Hertz's compliance with a financial covenant consisting of a ratio of first lien debt to Consolidated EBITDA ("the First Lien Ratio"), as defined within the First Lien Credit Agreement and may be materially different than Adjusted Corporate EBITDA presented in Part II, Item 7 of this 2025 Annual Report, to require a ratio of less than or equal to 5.0x in the second and third quarters of 2024 and 4.75x in the fourth quarter of 2024 and first quarter of 2025.
Added
Upon expiration of Amendment No. 8, the First Lien Ratio reverted to a requirement of less than or equal to 3.0x in the first and last quarters of the calendar year and 3.5x in the second and third quarters of the calendar year.
Added
In May 2025, the First Lien Credit Agreement was amended ("Amendment No. 10"), which provided for the extension of the maturity date of $1.7 billion of commitments under our existing $2.0 billion First Lien RCF from 61 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) June 2026 to March 2028, subject to a springing maturity date (as defined in the First Lien Credit Agreement) and makes certain other amendments to the First Lien Credit Agreement.
Added
We will have access to up to $2.0 billion under the First Lien RCF until June 2026, and thereafter the aggregate amount of commitments under the First Lien RCF will be $1.7 billion until March 2028, after giving effect to the terms of Amendment No. 10.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

10 edited+3 added−0 removed5 unchanged
Biggest changeQUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (Continued) Fuel Risks We purchase unleaded gasoline and diesel fuel at prevailing market rates. We are subject to price exposure related to the fluctuations in the price of fuel. We anticipate that fuel risk will remain a market risk for the foreseeable future.
Biggest changeSee Note 12, "Financial Instruments," and Note 13, "Fair Value Measurements," in Part II, Item 8 of this 2025 Annual Report. Fuel Risks We purchase unleaded gasoline and diesel fuel at prevailing market rates. We are subject to price exposure related to the fluctuations in the price of fuel.
We may also purchase foreign currency exchange rate derivative financial instruments to manage exposure to fluctuations in foreign currency exchanges rates. See Note 12, "Financial Instruments," in Part II, Item 8 of this 2024 Annual Report. 73 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7A.
We may also purchase foreign currency exchange rate derivative financial instruments to manage exposure to fluctuations in foreign currency exchanges rates. See Note 12, "Financial Instruments," in Part II, Item 8 of this 2025 Annual Report. 73 Table of Contents HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES THE HERTZ CORPORATION AND SUBSIDIARIES ITEM 7A.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK RISK MANAGEMENT For a discussion of additional risks arising from our operations, including vehicle liability, general liability and property damage insurable risks, see “Item 1—Business—Insurance and Risk Management” included in this 2024 Annual Report.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK RISK MANAGEMENT For a discussion of additional risks arising from our operations, including vehicle liability, general liability and property damage insurable risks, see “Item 1—Business—Insurance and Risk Management” included in this 2025 Annual Report.
From time to time, we enter into interest rate swap and/or interest rate cap agreements to manage interest rate risk and our mix of fixed and floating rate debt. See Note 12, "Financial Instruments," in Part II, Item 8 of this 2024 Annual Report.
From time to time, we enter into interest rate swap and/or interest rate cap agreements to manage interest rate risk and our mix of fixed and floating rate debt. See Note 12, "Financial Instruments," in Part II, Item 8 of this 2025 Annual Report.
Assuming a hypothetical change of one percentage point to the foreign currency exchange rates on our intercompany loan balance as of December 31, 2024, our pre-tax operating results would increase (decrease) by approximately $4 million.
Assuming a hypothetical change of one percentage point to the foreign currency exchange rates on our intercompany loan balance as of December 31, 2025, our pre-tax operating results would increase (decrease) by approximately $4 million.
See Note 7, "Debt," in Part II, Item 8 of this 2024 Annual Report. We have assessed our exposure to changes in interest rates by analyzing the sensitivity to our operating results assuming various changes in market interest rates.
See Note 7, "Debt," in Part II, Item 8 of this 2025 Annual Report. We have assessed our exposure to changes in interest rates by analyzing the sensitivity to our operating results assuming various changes in market interest rates.
Assuming a hypothetical increase of one percentage point in interest rates on our debt portfolio, cash equivalents and investments as of December 31, 2024, our pre-tax operating results would decrease by an estimated $59 million over a twelve-month period.
Assuming a hypothetical increase of one percentage point in interest rates on our debt portfolio, cash equivalents and investments as of December 31, 2025, our pre-tax operating results would decrease by an estimated $48 million over a twelve-month period.
We have determined that a 10% hypothetical change in the price of fuel will not have a material impact on our operating results. Inflationary Risks The increased cost of vehicles, higher staffing costs and increased interest expenses are the primary inflationary factors affecting us.
We anticipate that fuel risk will remain a market risk for the foreseeable future. We have determined that a 10% hypothetical change in the price of fuel will not have a material impact on our operating results. Inflationary Risks The increased cost of vehicles, higher staffing costs and increased interest expenses are the primary inflationary factors affecting us.
Derivative financial instruments are viewed as risk management tools and have not been used for speculative or trading purposes. Although the instruments utilized involve varying degrees of credit, market and interest risk, we contract with multiple counterparties to mitigate concentrations of risk and the counterparties to the agreements are expected to perform fully under the terms of the agreements.
Although the instruments utilized involve varying degrees of credit, market and interest risk, we contract with multiple counterparties to mitigate concentrations of risk and the counterparties to the agreements are expected to perform fully under the terms of the agreements.
MARKET RISKS We are exposed to a variety of market risks, including the effects of changes in interest rates (including credit spreads), foreign currency exchange rates and fluctuations in fuel prices. We manage our exposure to these market risks through our regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments.
MARKET RISKS We are exposed to a variety of market risks, including the effects of changes in interest rates (including credit spreads), foreign currency exchange rates, market price movements of Hertz Global common stock and fluctuations in fuel prices.
Added
We manage our exposure to these market risks through our regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. Derivative financial instruments are viewed as risk management tools and have not been used for speculative or trading purposes.
Added
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (Continued) Equity Price Risk We have exposure to market price movements of Hertz Global common stock in connection with the Exchangeable Notes Due 2030. To manage our exposure, we have entered into capped call derivative financial instruments, the Capped Call Transactions 2030.
Added
The Capped Call Transactions 2030 are classified as Level 3 in the fair value hierarchy resulting from the use of expected volatility, an unobservable input. In general, holding other inputs constant, an increase (decrease) in expected volatility would result in a higher (lower) fair value measurement, respectively.

Other HTZ 10-K year-over-year comparisons