Avis Budget Group (NasdaqGS:CAR) Q4 2025 Earnings call February 19, 2026 08:30 AM ET Company ParticipantsAndrew Percoco - Executive DirectorBrian Choi - CEODaniel Cunha - EVP and CFODavid Calabria - SVP, Corporate Finance and TreasurerJosh Young - Vice PresidentStephanie Moore - Managing DirectorConference Call ParticipantsChristopher Stathoulopoulos - Senior Equity Research AnalystJohn Healy - Managing Director and Senior Research AnalystOperatorWelcome to the Avis Budget Group Q4 earnings call. At this ti ...

Avis Budget Group (NasdaqGS:CAR) Q4 2025 Earnings call February 19, 2026 08:30 AM ET Company ParticipantsAndrew Percoco - Executive DirectorBrian Choi - CEODaniel Cunha - EVP and CFODavid Calabria - SVP, Corporate Finance and TreasurerJosh Young - Vice PresidentStephanie Moore - Managing DirectorConference Call ParticipantsChristopher Stathoulopoulos - Senior Equity Research AnalystJohn Healy - Managing Director and Senior Research AnalystOperatorWelcome to the Avis Budget Group Q4 earnings call. At this ti ...

Financial Data and Key Metrics Changes - The company reported a full-year adjusted EBITDA of $748 million, missing the guidance of $900 million by approximately $150 million, with the fourth quarter adjusted EBITDA expected to be around $157 million [5][6] - The Americas segment was the primary contributor to the EBITDA miss, while the international business performed as expected [6][10] - Rental days in the Americas were flat for the quarter instead of the expected 3% growth, with commercial rental days down 11% in November [6][7] Business Line Data and Key Metrics Changes - The Americas segment faced significant challenges, including a decline in rental days and pricing pressure, leading to a $40 million revenue impact and an additional $60 million from higher gross depreciation and lower gains on vehicle sales [12][13] - The company took a $500 million write-down on its EV fleets, which was viewed as a necessary reset to strengthen the balance sheet [14][15] Market Data and Key Metrics Changes - The used vehicle market saw a decline in prices, with the Manheim Rental Index price per vehicle dropping nearly $1,000, or 4.3%, from October to November [9] - The pricing pressure was evident across the industry, with RPD in the Americas finishing the quarter down 3.7%, worse than the anticipated 2% decline [10][11] Company Strategy and Development Direction - The company is shifting its focus from fleet growth to utilization, aiming to reduce volatility in pricing and earnings [18][20] - A global reduction in force was implemented to align the organizational structure with the business plan for 2026 and beyond [24] - The company is re-evaluating its OEM partnerships to ensure reliability and execution, which are critical for fleet purchasing decisions [21][22] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the fourth quarter as a setback but emphasized it as a catalyst for change, focusing on execution and capital allocation [28] - The company expects to stabilize revenue and improve utilization in 2026, with a goal of generating EBITDA north of $1 billion annually [78] Other Important Information - The company plans to continue its partnership with Waymo, with the Dallas launch on schedule and potential expansion into additional cities [27][68] - The average age of the U.S. rental car fleet is expected to be less than a year old by the end of the first quarter, marking a significant improvement [26] Q&A Session Summary Question: 2026 guidance and key inputs - Management acknowledged a wide range for adjusted EBITDA guidance and discussed assumptions regarding RPD and DPU, indicating a focus on utilization over fleet size [31][32] Question: Differences between Americas and international segments - The actions regarding fleet resizing and depreciation adjustments are primarily focused on the Americas segment, with the international segment experiencing less volatility [34][35] Question: Fleet cost expectations - Management explained that the first quarter's high fleet cost is expected to normalize over the year, with adjustments made to reflect current market conditions [41][42] Question: Pricing environment and competitive trends - The pricing environment remains competitive, but actions taken to reduce fleet size are expected to align supply more closely with demand, stabilizing pricing [45][46] Question: EV impairment and DPU benefits - The company discussed the monetization of EV tax credits and the decision to shorten the economic life of EV vehicles, which is expected to reduce depreciation costs significantly [65][66] Question: Collaboration with Waymo - Management refrained from disclosing specific financial details regarding the Waymo partnership, emphasizing operational capability over immediate capital deployment [67][68]

4Q & FY 2025 Supplemental Financials Forward-Looking Statements Certain statements in this presentation constitute "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained herein are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from those expressed or implied by any such forward-looking stat ...

The Q4 adjusted EBITDA miss of approximately $150 million was concentrated entirely in the Americas segment, driven by a sudden November demand reversal. Commercial rental days plummeted from mildly down in October to down 11% in November due to FAA flight reductions and TSA disruptions, erasing expected growth. Management aggressively defleeted in November despite unfavorable used car market conditions to avoid carrying excess capacity into a soft demand environment. Industry-wide capacity remained ...

Financial Performance - Fourth quarter revenues were $2.7 billion, with a net loss of $856 million and Adjusted EBITDA of $5 million[1] - Full year revenues reached $11.7 billion, with a net loss of $995 million and Adjusted EBITDA of $748 million[1] - Revenues for Q4 2025 were $2,664 million, a decrease of 2% from $2,710 million in Q4 2024; total revenues for the year were $11,652 million, down 1% from $11,789 million in 2024[16] - Net loss attributable to Avis Budget Group, Inc. for Q4 2025 was $747 million, a 62% improvement compared to a loss of $1,958 million in Q4 2024; for the year, the net loss was $889 million, down 51% from $1,821 million in 2024[16] - Adjusted EBITDA for Q4 2025 was $5 million, compared to a loss of $101 million in Q4 2024; for the year, Adjusted EBITDA increased by 19% to $748 million from $628 million in 2024[16] - For the year ended December 31, 2025, Avis Budget Group reported a net loss of $995 million, compared to a net loss of $1,817 million in 2024, indicating a 45.3% improvement year-over-year[28] - Adjusted EBITDA for the year ended December 31, 2025, was $748 million, up from $628 million in 2024, reflecting a 19.2% increase[28] - The company experienced a total revenue of $11,652 million for the year ended December 31, 2025, compared to $11,789 million in 2024, representing a decrease of 1.2%[34] Operational Metrics - Adjusted EBITDA in the Americas improved to $1 million from a loss of $63 million year-over-year, driven by lower fleet costs[3] - International Adjusted EBITDA was $21 million, compared to a loss of $11 million in the same period last year, supported by stronger revenue per day[3] - Americas segment revenues decreased by 4% to $2,040 million in Q4 2025 from $2,117 million in Q4 2024; for the year, revenues were $8,900 million, down 2% from $9,111 million[16] - International segment revenues increased by 5% to $624 million in Q4 2025 from $593 million in Q4 2024; for the year, revenues rose by 3% to $2,752 million from $2,678 million[16] - Total vehicle utilization improved to 68.0% in Q4 2025 from 67.7% in Q4 2024; for the year, it was 70.1%, up from 69.1%[21] - Vehicle utilization for the year ended December 31, 2025, was 69.9%, slightly up from 68.7% in 2024, showing a 1.7% improvement[34] - Total rental days for the year ended December 31, 2025, were 175,121, compared to 175,705 in 2024, a decrease of 0.3%[34] Cash Flow and Liquidity - Liquidity position at the end of the quarter was approximately $818 million, with an additional $2.1 billion of fleet funding capacity[3] - Net cash provided by operating activities for the year ended December 31, 2025, was $3,296 million[24] - Adjusted Free Cash Flow for the year ended December 31, 2025, was $(698) million, reflecting significant capital expenditures and vehicle program costs[24] - Cash and cash equivalents at the end of the period were $618 million, down from $597 million at the beginning of the period[24] - Adjusted Free Cash Flow for the year ended December 31, 2025, was $(698) million, compared to $(1,817) million in 2024, indicating a significant reduction in cash outflow[29] Fleet Management - The company is focusing on tightening fleet discipline and enhancing customer experience to drive sustainable earnings growth[2] - Average rental fleet size decreased by 2% to 660,421 vehicles in Q4 2025 from 671,966 in Q4 2024; for the year, it was 684,148, down from 695,084[21] - Average rental fleet size for the year ended December 31, 2025, was 684,148 vehicles, down from 695,084 in 2024, a reduction of 1.6%[34] - The company incurred an impairment charge of approximately $518 million in 2025 related to the acceleration of the rotation of certain EV rental car vehicles[30] Market Conditions and Risks - Future performance may be impacted by competition, economic conditions, and changes in fleet costs among other factors[9] - Revenue per day, excluding exchange rate effects, decreased by 2%, and rental days were down 1% compared to Q4 2024[3] - Revenue per day (RPD) for the Americas segment was $68.80 for the year ended December 31, 2025, down from $70.94 in 2024, a decline of 3.0%[34] Financial Metrics Definitions - Adjusted Free Cash Flow is a key metric for measuring cash available for debt repayment, stock repurchase, dividends, and future growth investments[41] - Adjusted EBITDA Margin is calculated as Adjusted EBITDA expressed as a percentage of revenues[42] - Available Rental Days are defined as the Average Rental Fleet multiplied by the number of days in a given period[43] - Average Rental Fleet represents the average number of vehicles in the fleet during a specific time period[44] - Net Corporate Debt is calculated as corporate debt minus cash and cash equivalents[47] - Net Corporate Leverage is determined by dividing Net Corporate Debt by Adjusted EBITDA for the twelve months prior to the calculation date[48] - Total Net Debt Ratio is the total debt less cash and cash equivalents divided by Gross Adjusted EBITDA for the twelve months prior to the calculation date[49] - Per-Unit Fleet Costs include vehicle depreciation, lease charges, and gains or losses on vehicle sales, divided by the Average Rental Fleet[50] - Vehicle Utilization is calculated as Rental Days divided by Available Rental Days[53]

Core Viewpoint - Analysts forecast that Avis Budget Group (CAR) will report a quarterly loss of -$0.29 per share, reflecting a year-over-year decline of 26.1%, with anticipated revenues of $2.75 billion, an increase of 1.3% compared to the previous year [1]. Earnings Estimates - The consensus EPS estimate for the quarter has been revised 14.8% lower over the last 30 days, indicating a collective reevaluation by analysts [2]. - Revisions to earnings estimates are crucial indicators for predicting potential investor actions regarding the stock, with empirical research showing a strong correlation between earnings estimate trends and short-term stock price performance [3]. Revenue Metrics - Analysts estimate 'Geographic Revenue - International' to reach $621.41 million, a change of +4.8% from the year-ago quarter [5]. - The estimated 'Geographic Revenue - Americas' is projected at $2.15 billion, suggesting a change of +1.3% year over year [5]. Fleet Costs - 'Americas - Per-Unit Fleet Costs per Month' is expected to be $328.2, down from $430.0 reported in the same quarter last year [6]. - 'International - Per-Unit Fleet Costs per Month' is projected at $273.6, compared to $304.0 in the same quarter last year [6]. Rental Days and Utilization - 'International - Rental Days' is estimated to be 10,887 days, slightly down from 10,956 days reported in the previous year [7]. - 'Americas - Revenue per Day, excluding exchange rate effects' is expected to be $68.10, compared to $68.64 in the same quarter last year [7]. - 'Americas - Vehicle Utilization' is projected at 69.0%, up from 67.4% in the previous year, while 'International - Vehicle Utilization' is expected to reach 70.2%, compared to 68.3% last year [8]. Average Rental Fleet - The consensus estimate for 'Americas - Average Rental Fleet' stands at 496,375, down from 497,713 in the previous year [8]. - 'Total - Rental Days' is forecasted to reach 42,388 days, compared to 41,833 days in the previous year [9]. - The average prediction for 'International - Average Rental Fleet' is 168,587, down from 174,253 reported last year [9]. - The consensus for 'Total - Average Rental Fleet' is 664,963, compared to 671,966 in the same quarter last year [9]. Stock Performance - Shares of Avis Budget have changed by -5.8% in the past month, contrasting with a -1.7% move of the Zacks S&P 500 composite, indicating expected underperformance in the near future [11].

Core Insights - The analysis of CAR stock options indicates a potential price range between $105.55 and $135.30 by the March 20 expiration date, based on the Black-Scholes-derived Expected Move calculator [1] - The volatility skew suggests that traders are more focused on protecting against upside volatility rather than hedging against downside risks, indicating a belief in potential upside for CAR stock [2][3] - Recent options flow data shows a bullish sentiment, with significant net trade sentiment favoring optimistic positions, particularly noted on February 4 with $562,800 above parity and nearly $197 million on January 15 [4] Earnings Report Expectations - Avis Budget Group (CAR) is set to release its earnings report on February 18, and trading patterns in the options market suggest a non-trivial possibility of an earnings surprise [5] - Despite CAR stock losing approximately 22% over the past six months and starting the new year down more than 6%, certain indicators hint at a potential positive surprise [6] Price Movement Projections - The Black-Scholes model indicates that CAR stock is expected to trade within a range that reflects one standard deviation from the current price, with a 68% probability of staying within this range [7][8] - A probabilistic analysis suggests that CAR stock may move between $115 and $145 over the next 10 weeks, with the highest probability density around $133 [14] Analytical Framework - The Markov property is applied to assess future price movements based on current trends, indicating that the recent pattern of three up weeks in the last ten weeks suggests a specific drift pattern for CAR stock [13] - The analysis acknowledges the limitations of various models, including the Black-Scholes assumption of lognormally distributed returns, while arguing that Markov-based analyses provide a more grounded approach to narrowing uncertainty [15][16][17]

Core Insights - Anixa Biosciences is reporting promising outcomes from its ongoing Phase 1 clinical trial of CAR-T therapy for recurrent ovarian cancer, with several patients exceeding expected survival rates at low dose levels [1][2][3] Group 1: Trial Overview - The Phase 1 trial is focused on adult women with recurrent ovarian cancer who have not responded to standard chemotherapy and have progressed after two or more therapies [2] - Twelve patients have been treated at four dosage levels, with seven patients living beyond the expected median survival of three to four months [2] - Notably, one patient survived 28 months post-treatment, and three others have survived over one year [2] Group 2: Safety and Efficacy - The trial primarily aims to demonstrate safety, and the absence of dose-limiting toxicities (DLTs) has allowed for significant dose escalation [3][5] - The dosing may increase from 1×10 to as high as 1×10 CAR-positive cells per kilogram, representing a two-order-of-magnitude increase [3] - The favorable safety profile is attributed to the intra-peritoneal delivery method, which may enhance localized tumor targeting while reducing systemic toxicity [3] Group 3: Future Directions - The next patient cohort will receive higher doses following a lymphodepletion regimen, which is expected to create a more favorable environment for CAR-T cell activity [4] - The regulatory approval for the protocol amendment allows for further evaluation of both safety and potential therapeutic benefits as the study progresses [5] - Anixa plans to discuss trial observations and future plans in an upcoming fireside chat on February 10, 2026 [1][6] Group 4: Technology and Collaboration - Anixa's CAR-T therapy, lira-cel, targets the follicle-stimulating hormone receptor (FSHR), which is selectively expressed on ovarian cells and certain cancer cells [7] - The company collaborates with Moffitt Cancer Center, a leader in cancer immunotherapy, to develop its CAR-T therapy and other cancer vaccines [8]

Group 1 - The core appeal of car rental during the Spring Festival is the avoidance of ticketing hassles and the freedom to plan travel itineraries, making it a new option for consumers [1] - The Qingdao car rental market is entering a consumption peak as the Spring Festival approaches, characterized by delayed bookings, younger consumers, and increased demand for new energy vehicles [1][18] - Consumers prioritize cost-effectiveness and travel flexibility, leading to service upgrades from leading chain brands and local companies, resulting in a market that is "hot but not overly heated" [1] Group 2 - Consumers prefer chain platforms for their standardized services and convenience, with price and vehicle condition being the main considerations [3] - Rental prices during the Spring Festival can increase significantly, with reports indicating a rise of about 100% compared to regular rates [3] - The trend of last-minute bookings has become more pronounced, with only 30% of customers booking in advance compared to 70% in previous years [13] Group 3 - The rental market is seeing a notable trend towards younger customers, with the introduction of no-deposit policies making rentals more accessible [18] - New energy vehicles are becoming a significant growth point in the industry, with plans to increase their availability in the coming years [20] - The rental industry is evolving towards a "big transportation + local self-driving" model, with a focus on smart and convenient services [20]