United Rentals, Inc.

United Rentals, Inc. is the largest equipment rental company in the world. It is headquartered in Stamford, Connecticut, and its shares trade on the New York Stock Exchange under the symbol URI. It operates 1,665 branches in North America — in 49 U.S. states and every Canadian province — and about 110 more in Europe, Australia and New Zealand, and employs about 28,100 people. By the company's estimate, based on American Rental Association data, its North American market share is about 15% — in an industry that remains highly fragmented.

The model is simple to describe: the company buys equipment, rents it out by the hour, day, week or month, maintains it, and after several years sells it used. Its fleet comprises about 1.1 million units with an original cost of $23.75 billion, at an average age of about four years. 86% of 2025 revenues came from rentals, about 9% from sales of used fleet, and the remainder from new equipment sales, contractor supplies and service.

The company reports two segments. General rentals — about two-thirds of rental revenue — includes general construction and industrial equipment (backhoes, skid-steer loaders, forklifts, earthmoving), aerial work platforms (boom and scissor lifts), and general tools and light equipment. Specialty comprises five groups: power and HVAC (portable generators, electrical distribution, climate control); fluid solutions (pumps, tanks, treatment); trench safety (trench shields, hydraulic shoring, crossing plates); mobile storage and modular office space; and surface protection mats, a field it entered with the acquisition of Yak in March 2024. The specialty segment's share of company revenues rose from 7.3% in 2013 to 31.7% in 2025.

The customer base is highly diversified: the largest customer is about 1% of revenues and the top ten about 5%. By end market: about 48% of rental revenue from industrial and other non-construction customers (manufacturers, energy and chemical companies, railroads, utilities), about 48% from commercial construction, and about 4% from residential. The company has no controlling shareholder.

In the second quarter of 2026 the company reported record revenues of $4.41 billion and earnings of $12.03 per share, against $9.59 a year earlier. Rental revenue rose 12.7%, and the company raised its 2026 outlook for revenue and EBITDA.

A gain on the sale of a business that stays inside the "adjusted" numbers

In the quarter the company sold part of its scaffolding business and recorded a pre-tax gain of $49 million — $37 million after tax, or $0.58 per share. The gain is included in net income, and also in adjusted EPS ($12.76) and adjusted EBITDA ($2,056 million): the company's adjustments add back acquisition amortization, restructuring and stock compensation, but do not remove capital gains. The company states the effect in the footnotes and in the body of the release.

Right-hand column: simple subtraction of amounts the company itself discloses. The comparable half also contained a one-time item — a $64 million break-up fee from the H&E transaction that did not proceed. Excluding both, first-half EPS rose, by our computation, from $17.03 to $19.86.

The multi-year trend: revenues up, margins down, share count lower

Between 2023 and 2025 revenues rose 12.3% while net income rose only 2.9% — from $2,424 million to $2,494 million. Adjusted EBITDA margin fell from 47.8% to 45.5%, and rental gross margin from 39.9% to 38.0%. EPS rose 9.4% over the same period, and the difference between the two rates is share repurchases: the diluted share count fell from 65.2 million in the first half of 2025 to 62.8 million in the first half of 2026.

The company decomposes rental revenue growth into four components. In the second quarter: 7.1% growth in average fleet; an assumed 1.5% drag from inflation in equipment cost; a 3.4% increase in "fleet productivity" — an aggregate measure of rental rates, utilization and mix; and a 3.7% contribution from ancillary and re-rent revenue. Since 2019 the company has not reported rental rates and time utilization separately.

A rental company is essentially a balance sheet: equipment on one side, debt on the other. Rental equipment is carried at $17.4 billion after depreciation, against debt of $14.2 billion. Net debt to adjusted EBITDA stood at 1.8 at June 30, 2026, and liquidity at $3.0 billion.

Debt structure. About $9.8 billion of senior notes at rates of 3.75% to 6.125%, with maturities spread from 2027 to 2034; a $4.5 billion asset-based revolving facility through 2030, of which $1.67 billion was drawn; a $971 million term loan through 2031; and an accounts receivable securitization facility, amended in June 2026. Part of the debt carries a variable rate.

Cash flow, and three details worth knowing

First: free cash flow is flat — $2.06 to $2.31 billion in each of the three years — and the company guides to a similar range for 2026 ($2.15–$2.45 billion) even though it raised its EBITDA outlook: the entire increase is directed to equipment purchases, the outlook for which was raised to $4.85–$5.25 billion. Second: cash taxes paid in the half were $158 million, against a book tax provision of $424 million; deferred taxes on the balance sheet rose by $220 million to $3.3 billion. Federal tax legislation of July 2025 made 100% bonus depreciation permanent, so this is a standing regime rather than a one-time event; as long as the fleet grows, the difference is deferred. Third: at the end of June there were $328 million of equipment purchases not yet paid for, against $117 million at year-end 2025 — gross rental capital expenditures ($2,931 million) exceeded actual payments ($2,720 million).

In the first half the company returned $998 million to stockholders — $750 million in repurchases and $248 million in dividends — and paid $400 million for acquisitions. A new $5 billion repurchase program began in the quarter; the quarterly dividend is $1.97 per share.

United Rentals' annual report breaks each segment's rental costs into five lines. It is the most detailed disclosure the company provides on the economics of its equipment types, and it allows a comparison of general equipment with specialty equipment.

The percentages and the before-depreciation line were computed by us from the segment note. Per the report, the labor line also includes the wages of mechanics and drivers, so the repairs and delivery lines show parts, materials and outside costs only.

Before depreciation, the two segments earn almost the same on each dollar of revenue — about 57%. The entire difference in gross margin comes from two lines: depreciation (14.0% of revenue in specialty against 22.1% in general rentals) and repairs and maintenance (5.1% against 9.3%). The meaning: specialty equipment — trench shields, tanks, containers, generators, mats — produces more revenue per dollar of equipment cost, so depreciation is spread over a larger revenue base. A competitor that reports this directly, Sunbelt, shows revenue of 75 cents per dollar of equipment in specialty against 47 in general equipment, at an almost identical depreciation rate on cost. On the other side, delivery, set-up and ancillary services in specialty cost almost twice as much relative to revenue.

And specialty margins are declining: 48.9% in 2023, 48.1% in 2024, 43.6% in 2025, and 44.4% in the second quarter of 2026 against 45.8% a year earlier. The report explains this by "changes in revenue mix driven by growth in lower-margin ancillary and re-rent revenues". In the second quarter the segment's "all other" line rose 52%, from $162 million to $246 million, while segment revenue rose 24.8%. General rentals margin fell from 36.6% in 2023 to 35.2% in 2025, and rose to 35.8% in the second quarter of 2026.

Rental revenue by equipment type

The company does not disclose profitability, utilization or payback by equipment type — only by the two segments.

Scale and density. In equipment rental, whoever has a branch close to the customer with the right equipment in stock wins the transaction. A network of more than 1,600 branches makes it possible to move equipment between branches according to demand, to serve a national customer at every one of its sites, and to purchase from manufacturers at volumes a local competitor does not reach: the ten largest suppliers account for 52% of the company's capital expenditures.

"One-stop shop". Combining general equipment with five specialty groups lets a large customer — a plant, a data-center construction site, a refinery in turnaround — obtain everything from one supplier. "Key accounts" are 69% of rental revenue and "national accounts" 46%.

Managing the equipment life cycle. The company buys at volume discounts, rents — by our computation — for about seven to eight years, and sells the equipment used. In the second quarter of 2026 used equipment was sold at 52.9% of its original cost, at a gross margin of 46.7%. The weighted average salvage value to which equipment is depreciated on the books is 12% of cost.

What limits the advantage. The industry is competitive: per the report, competitive pressures have in the past led, and could lead again, to a decrease in market share or in prices. United faces Sunbelt and Herc, which in 2025 acquired H&E after United withdrew from the transaction, alongside thousands of local companies. Demand is cyclical and depends on construction and industrial investment. The price of new equipment is rising — the company itself assumes a 1.5% annual drag on fleet productivity from inflation — and the report lists tariffs among the factors raising maintenance and replacement costs. And the leverage, although moderate, is sensitive to interest rates.

Principal risks

• Cyclicality. About 48% of rental revenue from commercial construction and about 48% from industrial customers; a decline in investment hits both utilization and rates.
• The used-equipment market. About 9% of revenues and a recurring gain on equipment sales; a fall in used prices reduces earnings and lengthens payback.
• Cost of new equipment. The company itself assumes a 1.5% annual drag; the report lists tariffs among the drivers of higher costs.
• Competition in specialty. The segment every large player is expanding; its margin fell 530 basis points in two years.
• Leverage and interest rates. Debt of $14.2 billion, part of it at variable rates; interest expense rose from $635 million to $716 million in two years.
• Acquisitions. Goodwill of $7.2 billion; every acquisition adds capital that earns less than the equipment does.
• Recurring restructuring costs. Eight programs since 2008 at a cumulative cost of $435 million; the current program: $55–$65 million.

Matters under monitoring — measured directly from upcoming reports