EquipmentShare (NASDAQ: EQPT) raises $706M in IPO and posts Q1 2026 loss
Filing Impact
Filing Sentiment
Form Type
10-Q
EquipmentShare.com Inc. reported Q1 2026 results with total revenue of $989 million, up from $716 million a year earlier. Growth was broad-based across equipment rentals, sales, parts and supplies, and its T3 telematics platform. Equipment rental and related services generated $683 million, while platform revenue reached $50 million.
Operating income was roughly break-even at $1 million, compared with a $10 million operating loss in Q1 2025. After $70 million of interest expense, the company recorded a net loss of $29 million, improving from a $48 million net loss, or a loss of $0.20 per share versus $0.77 per share.
The January 2026 IPO was a major capital event, raising $747 million in gross proceeds and $706 million net, and converting $430 million of convertible preferred stock into Class A common stock. Total assets rose to $6.36 billion, equity increased to $1.20 billion, and cash ended the quarter at $329 million. Long‑term debt and lines of credit totaled $3.14 billion, including $999 million outstanding under the asset‑based revolving credit facility, leaving significant unused borrowing capacity.
Positive
- Rapid revenue growth with improving profitability: Q1 2026 revenue rose to $989 million from $716 million, while operating results improved from a $10 million loss to roughly break-even and net loss narrowed from $48 million to $29 million.
- Balance sheet strengthened by IPO and recapitalization: The January 2026 IPO generated $706 million in net proceeds and converted $430 million of convertible preferred stock into Class A common, more than doubling total equity to $1.201 billion and increasing cash to $329 million.
Negative
- High leverage and interest burden: Long‑term debt and lines of credit total $3.139 billion, including $999 million on the asset‑based revolving facility, with Q1 2026 interest expense of $70 million weighing on bottom‑line results.
- Significant cash outflow from operations: Net cash used in operating activities was $200 million in Q1 2026, compared with $51 million in the prior‑year period, reflecting working capital usage alongside growth investments.
Insights
Strong top-line growth and IPO cash improve flexibility, but leverage and cash burn remain key constraints.
EquipmentShare delivered rapid Q1 2026 expansion, with revenue at $989 million versus $716 million a year earlier. Operating performance improved to a near breakeven $1 million profit from a $10 million loss, while net loss narrowed to $29 million. This shows scale benefits despite higher depreciation and platform costs.
The IPO materially reshaped the balance sheet, adding net proceeds of $706 million and converting $430 million of convertible preferred into common equity. Total equity more than doubled to $1.201 billion, and cash increased to $329 million. However, total debt remains substantial at $3.139 billion, including $999 million drawn on the asset‑based revolving facility.
Net cash used in operating activities expanded to $200 million from $51 million, driven by working capital swings and higher non‑cash charges. Interest expense of $70 million is a notable drag on earnings. Subsequent filings may clarify whether strong revenue growth and IPO proceeds translate into sustained margin gains, lower leverage, or reduced reliance on the revolver.
Key Figures
Total revenue: $989 million
Net loss: $29 million
IPO net proceeds: $706 million
+5 more
8 metrics
Total revenue
$989 million
Three months ended March 31, 2026
Net loss
$29 million
Three months ended March 31, 2026
IPO net proceeds
$706 million
January 26, 2026 initial public offering
Long-term debt and lines of credit
$3.139 billion
Outstanding as of March 31, 2026
ABL Credit Facility borrowings
$999 million
SOFR-based revolver balance as of March 31, 2026
Net cash from operating activities
-$200 million
Three months ended March 31, 2026
Cash and cash equivalents
$329 million
Balance as of March 31, 2026
Branch network
371 full-service branches
As of March 31, 2026 across 45 U.S. states
Key Terms
OWN Program, T3 platform, asset-based revolving credit facility, IPO Founders Awards, +1 more
5 terms
OWN Program financial
"Our innovative capital-light fleet growth model (the “OWN Program”) subjects us to a number of risks"
T3 platform technical
"EquipmentShare delivers jobsite visibility and control through its cloud-based platform (“T3”)"
asset-based revolving credit facility financial
"a new senior secured asset-based revolving credit facility (the “ABL Credit Facility”)"
A loan arrangement where a lender agrees to make funds available up to a set limit that a borrower can draw, repay, and draw again, with the amount available tied to the value of specific assets (like inventory, receivables, or equipment) pledged as collateral. It matters to investors because it provides flexible working capital while limiting risk exposure: the company can fund growth or cover shortfalls quickly, but borrowing capacity can shrink if asset values fall.
IPO Founders Awards financial
"upon vesting of performance stock units (“PSUs”) granted to the Founders (see IPO Founders Awards below)"
performance stock units financial
"grants of PSUs to each of the Founders under the 2025 Plan"
Performance stock units are a type of company award that grants employees shares of stock only if certain performance goals are met. They motivate employees to work toward specific company achievements, aligning their interests with those of shareholders. For investors, they can influence a company's future stock supply and reflect management’s confidence in reaching key targets.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________________________
FORM 10-Q
For the quarterly period ended March 31, 2026
For the transition period from _________ to _________
Commission File Number 001-43062
(Exact Name of Registrant as Specified in Its Charter)
____________________________________________________________
(State of Incorporation) | (I.R.S. Employer Identification No.) | |
( | ||
(Address, including Zip Code, and telephone number, including area code, of registrant's principal executive offices) | ||
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days xYes o No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). x Yes o No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth
company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer | o | Accelerated Filer | o | |
x | Smaller Reporting Company | |||
Emerging Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). o Yes x No
As of May 10, 2026, the registrant had 214,806,153 shares of Class A common stock outstanding and 37,568,944 shares of Class B common stock outstanding.
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TABLE OF CONTENTS
Page No. | ||
PART I | FINANCIAL INFORMATION | |
Item 1 | Financial Statements and Supplementary Data | 5 |
Unaudited Condensed Consolidated Financial Statements | 6 | |
Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025 | 6 | |
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2026 and 2025 | 7 | |
Condensed Consolidated Statements of Comprehensive Loss for the Three Months Ended March 31, 2026 and 2025 | 8 | |
Condensed Consolidated Statements of Perpetual Preferred Stock and Equity for the Three Months Ended March 31, 2026 and 2025 | 9 | |
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2026 and 2025 | 10 | |
Notes to Condensed Consolidated Financial Statements | 11 | |
Item 2 | Management’s Discussion and Analysis of Financial Conditions and Results of Operations | 32 |
Item 3 | Quantitative and Qualitative Disclosures About Market Risk | 53 |
Item 4 | Controls and Procedures | 54 |
PART II | OTHER INFORMATION | |
Item 1 | Legal Proceedings | 55 |
Item 1A | Risk Factors | 55 |
Item 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 55 |
Item 5 | Other Information | 55 |
Item 6 | Exhibits and Financial Statement Schedules | 56 |
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the “Form 10-Q”) of EquipmentShare.com Inc (“EquipmentShare” or the
“Company”) and the documents incorporated by reference contain forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995.
Forward-looking statements generally relate to future events or our expected future financial or operating
performance. Such statements can be identified by the use of forward-looking terminology such as “believe,”
“expect,” “may,” “will,” “should,” “seek,” “on-track,” “plan,” “project,” “forecast,” “intend” or “anticipate,” or the
negative thereof or the negative of these words or other similar terms or expressions that concern our expectations,
strategy, plans, or intentions. Forward-looking statements involve risks and uncertainties that could cause actual
results to differ materially from historical experience or our present expectations.
Important factors that could cause our actual results to differ materially from those indicated in the forward-
looking statements include, but are not limited to, the following:
•The construction equipment rental industry is highly competitive, and competitive pressures could lead to a
decrease in our market share or in the prices that we can charge;
•Our dependence on relationships with certain suppliers to obtain equipment for our business;
•Our innovative capital-light fleet growth model (the “OWN Program”) subjects us to a number of risks,
many of which are beyond our control;
•Our suppliers of new equipment may appoint additional distributors, sell directly to our customers or
unilaterally terminate our distribution agreements with them, any of which could have a material adverse
effect on our equipment sales due to a loss of such sales;
•Our ability to effectively manage our workforce and operations, which have grown substantially since our
inception, and we expect will continue to do so in the future;
•We may not be able to facilitate our growth strategy by identifying and opening attractive new branch
locations, which could limit our revenues and profitability;
•We may encounter substantial competition or other difficulties in our efforts to expand our operations;
•A decline in construction and industrial activities, a downturn in the economy in general or other
macroeconomic or environmental factors could lead to decreased demand for our equipment, depressed
equipment rental rates and lower equipment sales prices;
•Disruptions in our supply chain could result in adverse effects on our results of operations and financial
performance;
•Our ability to collect on contracts with customers;
•Conditions that adversely affect related parties with which we have entered into equipment sale and rental
arrangements;
•Our reliance upon communications networks and centralized information technology systems and the
concentration of our systems which creates or increases risks for us, such as the risk of the misuse or theft
of information, including personal information;
•Our cloud-based platform (“T3”) is highly technical, and any prolonged undetected errors could adversely
affect our business;
•Our reliance on third parties maintaining open marketplaces to distribute our T3 platform and to provide the
software we use in certain of our products and offerings;
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•The dependence of our business upon the interoperability of our T3 platform across devices, operating
systems, and third-party applications that we do not control;
•Trends in oil and natural gas prices, which could adversely affect the level of exploration, development and
production activity of certain of our customers and the demand for our services, and products;
•Risks related to heightened inflation, recessionary conditions, and financial and capital market disruptions
that may adversely impact business conditions, the availability of credit and access to capital;
•Fluctuations in fuel costs or reduced supplies of fuel, which could harm our business; and
•Our exposure to a variety of claims and losses arising from our operations, which our insurance may not
cover all or any portion of such claims.
The foregoing factors should not be construed as exhaustive and should be read together with the other
cautionary statements included in this Form 10-Q. If one or more events related to these or other risks or
uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially
from what we anticipate. Many of the important factors that will determine these results are beyond our ability to
control or predict. Accordingly, you should not place undue reliance on any such forward-looking statements.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant
subject. These statements are based on information available to us as of the date of this Form 10-Q. Although we
believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future
results, level of activity, performance or achievements. Our statements should not be read to indicate that we have
conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently
uncertain, and investors are cautioned not to unduly rely on these statements. Moreover, neither we nor any other
person assumes responsibility for the accuracy and completeness of any of these forward-looking statements.
The forward-looking statements made in this Form 10-Q relate only to events as of the date on which the
statements are made. We are under no duty to update any of these forward-looking statements after the date of this
Form 10-Q to conform our prior statements to actual results or revised expectations or the occurrence of
unanticipated events, except as required by law.
You should note that we may announce material information to our investors using our investor relations
website (https://ir.equipmentshare.com/), filings with the Securities and Exchange Commission (the “SEC”), press
releases, public conference calls and webcasts. We use these channels, as well as social media, to communicate with
our investors. It is possible that the information that we post on these channels could be deemed to be material
information. We therefore encourage investors to visit these websites from time to time. The information contained
on such websites and social media posts is not incorporated by reference into this filing. We have included our
investor relations website address only as an inactive textual reference for convenience and do not intend it to be an
active link to our website.
See the section titled “Risk Factors” in this Form 10-Q and in our Annual Report on Form 10-K for the year
ended December 31, 2025 (the “2025 Form 10-K”) for a discussion of certain factors that could cause actual results
to differ materially from those expressed in our forward-looking statements. Additional factors that could cause
results or performance to differ materially from those expressed in our forward-looking statements are detailed in
other filings we may make with SEC, copies of which are available at no charge. New risks and uncertainties
emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact
on the forward-looking statements contained in this Form 10-Q. We cannot assure you that the results, events and
circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or
circumstances could differ materially from those described in the forward-looking statements.
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except par value)
Unaudited
March 31, 2026 | December 31, 2025 | ||
ASSETS | |||
Cash and cash equivalents ................................................................................................................... | $ | $ | |
Accounts receivable, net ($ | |||
Inventories ........................................................................................................................................... | |||
Prepaid costs ........................................................................................................................................ | |||
Other current assets ............................................................................................................................. | |||
Total current assets ..................................................................................................................... | |||
Rental equipment, net .......................................................................................................................... | |||
Property and other fixed assets, net ..................................................................................................... | |||
Capitalized software, net ..................................................................................................................... | |||
Right of use assets, operating .............................................................................................................. | |||
Investments in non-consolidated affiliates .......................................................................................... | |||
Intangible assets, net ............................................................................................................................ | |||
Other assets .......................................................................................................................................... | |||
Total assets ................................................................................................................................. | $ | $ | |
LIABILITIES, PERPETUAL PREFERRED STOCK, AND EQUITY | |||
Accounts payable ($ | $ | $ | |
Accrued liabilities ................................................................................................................................ | |||
Manufacturer flooring plans payable .................................................................................................. | |||
Current portion of long-term debt ....................................................................................................... | |||
Current portion of operating lease liabilities ....................................................................................... | |||
Current portion of finance lease liabilities .......................................................................................... | |||
Current portion of financing obligations ............................................................................................. | |||
Total current liabilities ............................................................................................................... | |||
Long-term debt, net of current portion, original issue discounts, and debt issuance costs ................. | |||
Operating lease liabilities, net of current portion ($ | |||
Finance lease liabilities, net of current portion ($ | |||
Financing obligations, net of current portion ...................................................................................... | |||
Deferred tax liabilities, net .................................................................................................................. | |||
Other liabilities .................................................................................................................................... | |||
Total liabilities ............................................................................................................................ | |||
Perpetual preferred stock, net - $ issued and outstanding at March 31, 2026 and December 31, 2025, respectively .............................. | |||
Common stock - $ March 31, 2026, | |||
Class A common stock - $ outstanding at March 31, 2026, 2025 | |||
Class B common stock - $ outstanding at March 31, 2026, 2025 | |||
Convertible preferred stock, net - $ outstanding as of March 31, 2026, at December 31, 2025 .......................................................................................................................... | |||
Treasury stock, at cost, | ( | ( | |
Additional paid-in-capital .................................................................................................................... | |||
Retained earnings (accumulated deficit) ............................................................................................. | ( | ||
Accumulated other comprehensive income (loss) ............................................................................... | ( | ||
Total equity ................................................................................................................................. | |||
Total liabilities, perpetual preferred stock, and equity ............................................................... | $ | $ |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
Unaudited
Three Months Ended March 31, | |||
2026 | 2025 | ||
REVENUES | |||
Equipment rental and related services .............................................................................................. | $ | $ | |
Equipment sales ($ | |||
Equipment parts and supplies and services ...................................................................................... | |||
Platform: ........................................................................................................................................... | |||
Telematics ...................................................................................................................................... | |||
Other .............................................................................................................................................. | |||
Total revenues ............................................................................................................................. | |||
COST OF REVENUES | |||
Direct operating costs ....................................................................................................................... | |||
OWN Program payouts ( $ | |||
Equipment sales ................................................................................................................................ | |||
Platform expense .............................................................................................................................. | |||
Depreciation and amortization ......................................................................................................... | |||
Total cost of revenues .................................................................................................................... | |||
Gross profit .................................................................................................................................... | |||
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ...................................................... | |||
Operating income (loss) ................................................................................................................. | ( | ||
OTHER INCOME (EXPENSE) | |||
Interest expense ................................................................................................................................ | ( | ( | |
Other income, net ($ | |||
Total other expense, net ................................................................................................................. | ( | ( | |
LOSS BEFORE BENEFIT FROM INCOME TAXES ................................................................. | ( | ( | |
Benefit from income taxes .................................................................................................................. | ( | ( | |
NET LOSS .......................................................................................................................................... | $( | $( | |
Deemed dividends on perpetual preferred stock ................................................................................. | ( | ( | |
Net loss attributable to common shareholders .................................................................................... | $( | $( | |
Weighted average common shares outstanding (Class A and Class B): ............................................. | |||
Basic ................................................................................................................................................. | |||
Diluted .............................................................................................................................................. | |||
Loss per common share (Class A and Class B): ................................................................................. | |||
Basic ................................................................................................................................................. | $( | $( | |
Diluted .............................................................................................................................................. | $( | $( | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In millions)
Unaudited
Three Months Ended March 31, | |||
2026 | 2025 | ||
Net loss ................................................................................................................................................ | $( | $( | |
Other comprehensive income (loss), net of tax: | |||
Change in fair value of derivative instruments ............................................................................... | ( | ||
COMPREHENSIVE LOSS ................................................................................................................. | ( | ( | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF PERPETUAL PREFERRED STOCK AND EQUITY
(In millions)
Unaudited
Retained | Accumulated | ||||||||||||||||||||||||||||
Perpetual | Class A | Class B | Convertible | Additional | Earnings | Other | |||||||||||||||||||||||
Preferred Stock, net | Common Stock | Common Stock | Common Stock | Preferred Stock, net | Treasury | Paid-In | (Accumulated | Comprehensive | Total | ||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Stock | Capital | Deficit) | Income (Loss) | Equity | |||||||||||||||
Balance at January 1, 2026 | $ | $ | $ | $( | $ | $ | $ | $ | |||||||||||||||||||||
Net loss | – | – | – | – | – | – | – | – | – | – | – | – | ( | – | ( | ||||||||||||||
Reclassification of net (gain) loss from derivative instruments, net of tax | – | – | – | – | – | – | – | – | – | – | – | – | – | ( | ( | ||||||||||||||
Foreign currency translation adjustments | – | – | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||
Unrealized gain on available-for-sale debt securities | – | – | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||
Conversion of common stock to Class A common stock in connection with IPO | – | – | ( | – | – | – | – | – | – | – | – | – | – | – | |||||||||||||||
Conversion of convertible preferred stock to class A common stock in connection with IPO | – | – | – | – | – | – | – | ( | ( | – | – | – | |||||||||||||||||
Conversion of class A common stock to class B common stock in connection with IPO | – | – | – | – | ( | – | – | – | – | – | – | – | – | – | |||||||||||||||
Issuance of class A common stock in connection with IPO, net of underwriting discounts and offering costs | – | – | – | – | – | – | – | – | – | – | – | – | |||||||||||||||||
Accretion of perpetual preferred stock to redemption value | – | – | – | – | – | – | – | – | – | – | ( | – | – | ||||||||||||||||
Exercises of stock options | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Stock-based compensation | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Balance at March 31, 2026 | $ | $ | $ | $ | $( | $ | $( | $( | $ | ||||||||||||||||||||
Retained | Accumulated | ||||||||||||||||||||||||||||
Perpetual | Class A | Class B | Convertible | Additional | Earnings | Other | |||||||||||||||||||||||
Preferred Stock, net | Common Stock | Common Stock | Common Stock | Preferred Stock, net | Treasury | Paid-In | (Accumulated | Comprehensive | Total | ||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Stock | Capital | Deficit) | Income | Equity | |||||||||||||||
Balance at January 1, 2025 | $ | $ | $ | $ | $ | $ | $( | $ | $ | $ | $ | ||||||||||||||||||
Impact of adoption of ASU 2020-06 | – | – | – | – | – | – | – | – | – | – | – | – | |||||||||||||||||
Net loss | – | – | – | – | – | – | – | – | – | – | – | – | ( | – | ( | ||||||||||||||
Change in fair value of derivative instruments, net of tax | – | – | – | – | – | – | – | – | – | – | – | – | – | ( | ( | ||||||||||||||
Accretion of perpetual preferred stock to redemption value | – | – | – | – | – | – | – | – | – | – | ( | – | – | ( | |||||||||||||||
Exercises of stock options | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Stock-based compensation | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Balance at March 31, 2025 | $ | $ | $ | $ | $ | $( | $ | $( | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
Unaudited
Three Months Ended March 31, | |||
2026 | 2025 | ||
OPERATING ACTIVITIES | |||
Net loss ....................................................................................................................................................... | $( | $( | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization expense .................................................................................................. | |||
Amortization of debt issuance costs and original issue discounts .......................................................... | |||
Allowance for credit losses and doubtful accounts ................................................................................. | |||
Change in operating lease cost ................................................................................................................ | |||
Stock-based compensation expense ........................................................................................................ | |||
Deferred taxes ......................................................................................................................................... | ( | ( | |
Other ........................................................................................................................................................ | |||
Change in operating assets and liabilities: | |||
Accounts receivable ................................................................................................................................ | ( | ( | |
Inventories ............................................................................................................................................... | ( | ( | |
Prepaid costs and other assets ................................................................................................................. | ( | ( | |
Accounts payable and manufacturer flooring plans payable .................................................................. | ( | ( | |
Accrued liabilities ................................................................................................................................... | ( | ||
Operating lease liabilities ........................................................................................................................ | ( | ( | |
Net cash used in operating activities .................................................................................................... | ( | ( | |
INVESTING ACTIVITIES | |||
Purchases of rental equipment ($ | ( | ( | |
Proceeds from sale of rental equipment ($ | |||
Purchases of and deposits on property and other fixed assets ................................................................. | ( | ( | |
Investments in internally developed software ......................................................................................... | ( | ( | |
Purchases of investments in equity and debt securities ........................................................................... | ( | ( | |
Proceeds from sale of investments in equity and debt securities ............................................................ | |||
Acquisition of businesses, net of cash acquired ...................................................................................... | ( | ( | |
Net cash used in investing activities ..................................................................................................... | ( | ( | |
FINANCING ACTIVITIES | |||
Payments on long-term debt and finance leases ...................................................................................... | ( | ( | |
Proceeds from long-term debt ................................................................................................................. | |||
Payments on financing obligations ......................................................................................................... | ( | ( | |
Proceeds on financing obligations ........................................................................................................... | |||
Proceeds from issuance of class A common stock upon initial public offering, net of underwriting discount and commissions .................................................................................................................... | |||
Exercise of stock options ......................................................................................................................... | |||
Payments of equity issuance costs .......................................................................................................... | ( | ||
Net cash provided by financing activities ............................................................................................ | |||
Net increase (decrease) in cash and cash equivalents ................................................................................ | ( | ||
Cash and cash equivalents, beginning of period ..................................................................................... | |||
Cash and cash equivalents, end of period ............................................................................................... | $ | $ | |
SUPPLEMENTAL CASH FLOW DISCLOSURES: | |||
Cash paid for interest ............................................................................................................................... | $ | $ | |
Cash paid for taxes .................................................................................................................................. | |||
NON-CASH ACTIVITIES: | |||
Purchase of rental equipment remaining in accounts payable ................................................................ | $ | $ | |
Purchase of property and other fixed assets remaining in accounts payable .......................................... | |||
Accretion of perpetual preferred stock to redemption value ................................................................... | |||
Stock-based compensation for capitalized software development .......................................................... | |||
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Unaudited
1.BUSINESS
EquipmentShare.com Inc and subsidiaries (“EquipmentShare” or the “Company”) was organized in 2014 and
commenced operations on January 1, 2015. Effective June 30, 2025, EquipmentShare.com Inc changed its
jurisdiction of incorporation from the state of Delaware to the state of Texas.
The Company is a vertically integrated platform that combines proprietary technology, a connected equipment
fleet, and a nationwide footprint to serve the construction industry. More than a rental company, EquipmentShare
delivers jobsite visibility and control through its cloud-based platform (“T3”), which integrates embedded telematics
hardware, software applications, and real-time data to support both customers and internal operations. The T3
platform is original equipment manufacturer (“OEM”)-agnostic and gives the Company and its rental customers the
ability to track mixed fleets, maximize utilization, reduce unplanned downtime, streamline maintenance, and
improve jobsite security and operator accountability.
The Company utilizes its proprietary T3 platform in its equipment rental and service operations to manage
construction equipment that is owned by the Company, as well as construction equipment that is leased from third
party participants in the Company’s “OWN Program.” Under the OWN Program, participants may purchase from
the Company new or used (typically less than four years old) equipment which is fully enabled with T3.
Concurrently, the participant and the Company enter into a lease agreement whereby this qualified equipment is
placed on the Company’s T3 platform, to be rented to third party users. Rental revenue generated from equipment
enrolled under the OWN Program is divided and shared between the Company and the owner of the equipment, and
for the duration of the arrangement the Company manages the owner’s equipment utilizing the T3 platform. At the
end of the sharing period under the OWN Program, the Company may assist the owner with remarketing services if
the equipment is to be sold in the market as used construction equipment. The Company also offers several add-on
services to the owner of the equipment.
In addition to equipment rentals, the Company also offers complementary products and services, such as
equipment parts, supplies, services, and select jobsite support offerings. These products and services are integrated
with the T3 platform to support broader jobsite needs as part of the Company’s equipment rental and services
operations. The Company offers new and used equipment for sale to customers. Separately, the Company offers
telematics software as a service (“SaaS”) subscriptions, supported by embedded telematics hardware to customers
who use the digital tools to monitor fleet performance, manage maintenance, and oversee jobsite activity through a
single platform. The Company develops and enhances these tools and services with input from customers. The
Company also retails building materials and hardware supplies to customers.
As of March 31, 2026, the Company had 371 full-service branches, 9 dealership sites, and 27 building materials
and hardware retail stores located across 45 states in the U.S. The Company’s full-service, technology-enabled
model supports multiple customer touchpoints and allows it to operate a high-quality, diversified rental fleet. The
Company’s branch network also serves as an effective distribution channel for fleet disposition and supports related
activities including new and used equipment sales, parts, supplies and services. The Company is an authorized
dealer for JLG, Takeuchi, Skyjack, Genie, and other major brands of construction and aerial equipment, and offers
equipment rentals, parts, and services.
Initial Public Offering
On January 26, 2026, the Company completed its initial public offering (“IPO”) of 30.5 million shares of the
Company’s Class A common stock at a price of $24.50 , resulting in gross proceeds of $747 million and net proceeds
of $706 million after deducting underwriting discounts and commissions. In connection with the IPO, the Company
capitalized $14 million of equity issuance costs. The Company intends to use the net proceeds of the offering for
general corporate purposes.
Immediately prior to the completion of the IPO, the Company’s certificate of formation, bylaws, and investors’
rights agreement were amended and restated, resulting in, among other things, all shares of the Company’s common
stock, including shares of common stock issued upon the automatic conversion of the Company’s preferred stock
(other than shares of perpetual preferred stock which remain outstanding) being reclassified into shares of Class A
common stock, and immediately thereafter all shares of Class A common stock then held by the Company’s Chief
12
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Executive Officer or President (the “Founders”) were exchanged into an equivalent number of shares of Class B
common stock. Additionally, shares of Class A common stock will be issuable upon exercise or vesting of all
outstanding options and restricted stock units, as applicable, except that Class B shares will be issuable upon
exercise or vesting of options and restricted stock units held by the Founders and upon vesting of performance stock
units (“PSUs”) granted to the Founders (see IPO Founders Awards below).
Concurrent with the IPO, all outstanding shares of the Company’s convertible preferred stock were
automatically converted into 142 million shares of Class A common stock. Following the completion of the IPO, the
Company had 3,500 million of authorized shares of Class A common stock and approximately 215
Class A common stock issued and outstanding, along with 200 million of authorized shares of Class B common
stock and approximately 38
Following the completion of the IPO, the Class B common stock (which is held by the Founders who have
agreed to vote together as a group) represented more than 80 % of the total voting power of the outstanding common
stock and, as a result, the Company is considered to be a “controlled company” within the meaning of Nasdaq
2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
prepared in accordance with generally accepted accounting principles (“U.S. GAAP”) for interim financial
information. Accordingly, certain information and footnote disclosures required by U.S. GAAP for complete
financial statements have been condensed or omitted in accordance with Securities and Exchange Commission
(“SEC”) rules and regulations. In the opinion of the Company, the accompanying unaudited condensed consolidated
financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair
statement of its financial position as of March 31, 2026, and its results of operations, changes in perpetual preferred
stock and equity, and cash flows, for the three months ended March 31, 2026 and 2025. Interim results of operations
are not necessarily indicative of the results of the full year.
These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s
Annual Report on Form 10-K for the year ended December 31, 2025 (the “2025 Form 10-K”). The Company’s
significant accounting policies are described in Note 2 of the Company’s Audited Consolidated Financial Statements
as of and for the year ended December 31, 2025. There have been no significant changes to those accounting
policies in the Company’s preparation of the accompanying condensed consolidated financial statements as of and
for the three months ended March 31, 2026.
accordance with U.S. GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities,
the disclosures of contingent assets and liabilities, and the reported revenues and expenses. As future events and
their effects cannot be determined with precision, actual results could differ from the estimates that were used.
Measurement of Credit Losses for Accounts Receivable and Contract Assets: In July 2025, the FASB issued
ASU 2025-05, which provides optional guidance relating to the estimation of expected credit losses on current
accounts receivable and current contract assets. This guidance permits entities to apply a practical expedient when
estimating credit losses that assumes that current conditions as of the balance sheet date do not change for the
remaining life of the asset. Effective January 1, 2026, the Company began applying the practical expedient when
estimating credit losses on a prospective basis. The adoption of this guidance did not have a material impact on the
Company’s consolidated financial statements and related disclosures.
Accounting Pronouncements Issued, Not Yet Adopted
Disaggregation of Income Statement Expenses: In November 2024, the FASB issued ASU 2024-03, which is
intended to improve the disclosures about a public entity's expenses and address requests from investors for more
detailed information about the types of expenses in commonly presented expense captions. The guidance is effective
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after
December 15, 2027. Early adoption is permitted for annual financial statements that have not yet been issued or
made available for issuance. ASU 2024-03 should be applied on a prospective basis, but retrospective application is
permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its
consolidated financial statements and related disclosures.
Improvements to the Accounting for Internal-Use Software: In September 2025, the FASB issued ASU
2025-06, which amends the guidance in ASC 350-40, Intangibles - Goodwill and Other - Internal-Use Software. The
amendments modernize the recognition and disclosure framework for internal-use software costs, removing the
previous “development stage” model and introducing a more judgment-based approach. ASU 2025-06 is effective
for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently
evaluating the potential impact of ASU 2025-06 on its consolidated financial statements and related disclosures.
Interim Reporting - Narrow Scope Improvements: In December 2025, the FASB issued ASU 2025-11, which
clarifies interim disclosure requirements and the applicability of ASC 270, Interim Reporting. The objective of the
amendment is to provide further clarity about the current interim disclosure requirements. ASU 2025-11 is effective
for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early
adoption permitted. The Company is currently evaluating the potential impact of ASU 2025-11 on its interim
reporting requirements in the future.
Codification Improvements: In December 2025, the FASB issued ASU 2025-12, which updates U.S. GAAP for
a broad range of topics arising from technical corrections, unintended application of the codification, clarifications,
and other minor improvements. The guidance is effective for fiscal years beginning after December 15, 2026, and
interim reporting periods within those annual reporting periods, with early adoption permitted. The Company is
currently evaluating the potential impact of ASU 2025-11 on its consolidated financial statements and related
disclosures.
3.ACCOUNTS RECEIVABLE, NET
March 31, 2026 | December 31, 2025 | ||
Equipment rental and related services ................................................................... | $ | $ | |
Equipment sales ..................................................................................................... | |||
Equipment parts, supplies and services .................................................................. | |||
Billed or uninvoiced OEM reimbursement receivables ......................................... | |||
Other ...................................................................................................................... | |||
Total accounts receivable .................................................................................... | |||
Allowance for credit losses and doubtful accounts ................................................ | ( | ( | |
Accounts receivable, net ...................................................................................... | $ | $ |
14
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
4.INVENTORY
March 31, 2026 | December 31, 2025 | ||
Equipment inventory .............................................................................................. | $ | $ | |
Equipment parts ..................................................................................................... | |||
Telematics hardware .............................................................................................. | |||
Building materials, supplies, small tools, and other .............................................. | |||
Total inventories .................................................................................................. | $ | $ |
5.RENTAL EQUIPMENT, NET
March 31, 2026 | December 31, 2025 | ||
Rental equipment ................................................................................................... | $ | $ | |
Installed telematics tracker devices ........................................................................ | |||
Total rental equipment ........................................................................................... | |||
Less: accumulated depreciation ............................................................................. | ( | ( | |
Rental equipment, net ............................................................................................ | $ | $ |
The Company recognized depreciation expense of $82 million and $67 million for the three months ended
March 31, 2026 and 2025, respectively, included within depreciation and amortization as a component of cost of
revenues on the condensed consolidated statements of operations.
6.PROPERTY AND OTHER FIXED ASSETS, NET
March 31, 2026 | December 31, 2025 | ||
Furniture, fixtures, office equipment and other ..................................................... | $ | $ | |
Leasehold improvements ....................................................................................... | |||
Buildings and improvements ................................................................................. | |||
Construction in progress ........................................................................................ | |||
Land ....................................................................................................................... | |||
Total property and other fixed assets ..................................................................... | |||
Less: accumulated depreciation ............................................................................. | ( | ( | |
Total property and other fixed assets, net ......................................................... | $ | $ |
The Company recognized depreciation expense of $14 million and $9 million, for the three months ended
March 31, 2026 and 2025, respectively, included in selling, general and administrative expenses on the condensed
15
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
7.CAPITALIZED SOFTWARE, NET
March 31, 2026 | December 31, 2025 | ||
Capitalized software .............................................................................................. | $ | $ | |
Less: accumulated amortization ............................................................................ | ( | ( | |
Total capitalized software, net .......................................................................... | $ | $ |
The Company recognized amortization expense of $7 million and $4 million for the three months ended
March 31, 2026 and 2025, respectively, included within depreciation and amortization as a component of cost of
revenues on the condensed consolidated statements of operations.
8.ACCRUED LIABILITIES
March 31, 2026 | December 31, 2025 | ||
Accrued expenses ........................................................................................... | $ | $ | |
Accrued salaries and benefits ......................................................................... | |||
Accrued equipment purchases ....................................................................... | |||
Payable to OWN Program participants .......................................................... | |||
Accrued interest ............................................................................................. | |||
Insurance claims, including incurred but not reported ................................... | |||
Deferred revenue ............................................................................................ | |||
Manufacturer liability .................................................................................... | |||
Real and personal property tax payable ......................................................... | |||
Sales and income tax payable ........................................................................ | |||
Other .............................................................................................................. | |||
Total accrued liabilities ............................................................................. | $ | $ |
16
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
9.LONG-TERM DEBT AND LINES OF CREDIT
March 31, 2026 | December 31, 2025 | ||
Long-term debt and lines of credit: | |||
Asset based revolving credit facility, bearing interest at a rate of secured by equipment and other current assets ................................................. | $ | $ | |
Senior Secured Second Lien Notes bearing interest at a rate of | |||
Senior Secured Second Lien Notes bearing interest at a rate of | |||
Senior Secured Second Lien Notes bearing interest at a rate of | |||
Notes payable to various institutions, bearing interest at rates ranging from | |||
Equipment financing lines of credit with various institutions, bearing interest at rates ranging from | |||
Total long-term debt and lines of credit .................................................................... | |||
Less: original issue discounts .................................................................................... | ( | ( | |
Less: debt issuance costs ........................................................................................... | ( | ( | |
Less: current maturities ............................................................................................. | ( | ( | |
Long-term debt and lines of credit, net of current portion, original issue discounts, and debt issuance costs .......................................................................................... | $ | $ |
ABL Credit Facility
During 2021, the Company entered into an asset-based lending facility (the “ABL Facility”). On November 26,
2025, the Company refinanced existing borrowings under the ABL Facility by entering into a new senior secured
asset-based revolving credit facility (the “ABL Credit Facility”). The ABL Credit Facility has a maturity date of
November 26, 2030. The ABL Credit Facility provides available “borrowing capacity” (the maximum borrowing
permitted, assuming there is sufficient collateral as identified under the ABL Credit Facility) up to $2.75 billion.
Borrowings under the ABL Credit Facility bear interest at a rate (at the Company’s election) equal to either (i) the
Secured Overnight Financing Rate (“SOFR”) plus a spread between 112.5 to 137.5 basis points or (ii) the greatest of
(a) 0 %, (b) the Federal Funds Rate in effect on such day plus 50 basis points, (c) the SOFR for a one month tenor in
effect on such day (to the extent ascertainable), plus 100 basis points, and (d) the Prime Rate plus (y) a spread
between 12.5 basis points and 37.5 basis points. In connection with the refinancing, the Company expensed $8
million of previously capitalized debt issuance costs relating to certain lenders under the ABL Facility who exited
the syndicate, and included in loss on debt extinguishment on the consolidated statements of net income.
Additionally, in connection with the refinancing, the Company capitalized $9 million of debt issuance costs.
The ABL Credit Facility contains negative covenants that permit, subject to certain defined conditions, the
Company to, among other things, (i) incur additional indebtedness or engage in certain other types of financing
transactions, (ii) allow certain liens to attach to assets, (iii) repurchase, or pay dividends, or make certain other
restricted payments on, capital stock and certain other securities, subject to applicable caps, (iv) prepay certain
indebtedness and (v) make certain acquisitions and investments. Under the ABL Credit Facility, there is one
financial covenant that will only apply in the future if excess availability under the ABL Credit Facility falls below
the greater of 10 percent of the maximum borrowing amount under the ABL Credit Facility or $175 million. As of
March 31, 2026, availability under the ABL Credit Facility exceeded this threshold and, as a result, the financial
covenant was not applicable.
As of March 31, 2026, the Company had $999 million outstanding under the ABL Credit Facility bearing
interest at the SOFR of 4.80 %, included in long-term debt on the condensed consolidated balance sheets.
17
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
The ABL Credit Facility provides available “borrowing capacity” (the maximum borrowing permitted,
assuming there is sufficient collateral as identified under the ABL Facility) and “net excess availability” (the amount
of additional debt the Company could borrow based on the existing borrowing base). As of March 31, 2026, the
Company had a borrowing base, as defined in the ABL Credit Facility, of $2,280 million. After outstanding
borrowings and letters of credit, the net excess availability at March 31, 2026, as defined in the ABL Credit Facility,
was $1,276 million, of which the Company could borrow up to $1,048 million without any additional repayment
conditions.
Other
Certain note agreements between the Company and various institutions contain restrictions and financial
covenants, including maintaining an adjusted fixed charge coverage ratio of 1.15 to 1.00 and a net funded debt to
adjusted EBITDA ratio of 6.00 to 1.00. As of March 31, 2026, the Company was in compliance with those
restrictions and financial covenants.
As of March 31, 2026 the Company had $6 million of letters of credit outstanding with financial institutions
secured by line of credit availability. The letters of credit automatically renew annually unless the Company gives
10.LEASES
Leasing Activities – Lessee:
Lease arrangements with OWN Program participants: Under the OWN Program, the Company leases
equipment owned by participants. The Company accounts for these arrangements as a lease under FASB Accounting
Standards Codification (“ASC”) Topic 842, Leases (“Topic 842”) whereby the Company is the lessee.
Lease arrangements with other parties: The Company, as a lessee, also leases properties, vehicles, certain
equipment used in its operations from parties not participating in the OWN Program, and aircraft under various
operating and finance leases.
The leases are noncancellable and expire on various terms through 2040. There are no material payments for
leases that have not yet commenced.
the condensed consolidated statements of operations (In millions):
Statements of Operations | Three Months Ended March 31, | |||||
Component of Lease Cost | Line Item | 2026 | 2025 | |||
OWN Program lease payments ................... | OWN Program payouts | $ | $ | |||
Equipment and vehicle operating lease expense .................................................... | Direct operating costs | |||||
Real estate operating lease expense ............ | Selling, general and administrative expenses | |||||
Finance lease expense: | ||||||
Amortization of equipment leased assets .................................................. | Depreciation of rental equipment | |||||
Amortization of property leased assets .. | Selling, general and administrative expenses | |||||
Interest on lease liabilities ..................... | Interest expense, net | |||||
Short-term lease cost ................................... | Selling, general and administrative expenses | |||||
Total lease expense ..................................... | $ | $ | ||||
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
11.COMMON STOCK AND EQUITY PLANS
Initial Public Offering
Concurrent with the IPO, all outstanding shares of the Company’s convertible preferred stock were
automatically converted into 142 million shares of Class A common stock. As of March 31, 2026, the Company had
stock issued and outstanding, along with 200 million authorized shares of Class B common stock and approximately
Employee Stock Purchase Plan
In connection with the IPO, the Company adopted the EquipmentShare.com 2025 Employee Stock Purchase
Plan (the “ESPP”). The maximum number of shares initially available for issuance under the ESPP is 2,316,263
shares of common stock and will be increased on the first day of each fiscal year for a period of up to 10 years
following the effective date of the ESPP in an amount equal to the least of (i) 12,000,000 shares; (ii) 1 % of the total
number of shares of the Company’s Class A and Class B common stock outstanding as of the last completed fiscal
year; and (iii) such number of shares as determined by the Company’s Board of Directors (the “Board”) in its
discretion. The number of shares available at any time under the ESPP is subject to adjustment in the event of a
dividend or other distribution (other than an ordinary dividend or distribution), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares
or other securities of the Company, or other change in the Company’s structure affecting the shares occurs. The
number of shares which a participant may purchase in an offering under the ESPP may be reduced if the offering is
over-subscribed. The Company did not grant any shares of common stock pursuant to the ESPP during the three
months ended March 31, 2026.
2025 Omnibus Incentive Plan
In connection with the IPO, the Company also adopted the EquipmentShare.com Inc 2025 Omnibus Incentive
Plan (the “2025 Plan”). Awards under the 2025 Plan include stock options, stock appreciation rights, restricted
stock, restricted stock units, performance awards, other cash-based awards and other stock-based awards
(collectively, the “Awards”). The total number of shares of the Company’s common stock initially authorized for
issuance under the 2025 Plan is 40,370,162 shares of common stock and this amount will be increased on January 1
of each year following the effective date of the 2025 Plan for a period of 10 years in an amount equal to the lesser of
(i) 1 % of outstanding shares on the last day of the immediately preceding fiscal year and (ii) such number of shares
as determined by the Compensation Committee of the Board in its sole discretion. The Awards granted pursuant to
the 2025 Plan will be issued with respect to shares of Class A common stock of the Company, other than the IPO
Founders Awards. As of March 31, 2026, there were no
IPO Founders Awards
In connection with the IPO, the Board approved grants of PSUs to each of the Founders under the 2025 Plan
that could result in the issuance, to each of the Founders, of as few as zero shares of the Company’s Class B
common stock and up to 18,321,644 shares of Class B common stock. Each of the IPO Founders Awards was
granted on January 26, 2026 (the “Grant Date”) and is comprised of five tranches of PSUs as set forth in the table
below, the vesting of which are subject to service conditions and market conditions, including the Company
achieving specified stock price hurdles, as set forth in the table below and subject to anti-dilution adjustments,
during the performance period beginning on the first day following the expiration of the lock-up period set forth in
the Company’s agreement with its underwriters in connection with the IPO (or, with respect to tranche 1, beginning
on January 27, 2026) and ending on the earliest to occur of (i) the tenth anniversary of the Grant Date, (ii) a change
in control (as defined in the 2025 Plan) or (iii) the date on which the shares of the Company’s Class A common
stock are no longer traded on a securities exchange or market. Achievement of the applicable stock price hurdle for
any PSU tranche will occur on the date that the average closing price per share of the Company’s Class A common
stock during any 60 consecutive trading days during the performance period equaled or exceeded the applicable
stock price hurdle for such tranche, except that achievement of the stock price hurdle for tranche 1 occurred on
January 27, 2026, the date that the closing price per share of the Company’s Class A common stock during the
19
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
performance period equaled or exceeded the stock price hurdle for such tranche. Any PSUs for which the applicable
stock price hurdle is not achieved prior to the end of the performance period will be forfeited in their entirety.
Tranche | Price Hurdle (per Share) | % of Award eligible to be Earned | ||
1 | $ | |||
2 | $ | |||
3 | $ | |||
4 | $ | |||
5 | $ |
with the following assumptions:
Expected dividend yield ............................................................................................. | |
Expected volatility ..................................................................................................... | |
Risk-free interest rate ................................................................................................. | |
Requisite Service Period (years) - Tranche 1 ............................................................ | |
Requisite Service Period (years) - Tranche 2 ............................................................ | |
Requisite Service Period (years) - Tranche 3 ............................................................ | |
Requisite Service Period (years) - Tranche 4 ............................................................ | |
Requisite Service Period (years) - Tranche 5 ............................................................ |
The Company historically has not paid dividends on common stock and has no plans to issue dividends in the
foreseeable future. The expected volatility assumption used to estimate the Grant Date fair value of each tranche of
the award was based on the average historical volatility of comparable entities with publicly traded shares. The risk-
free rate for the requisite service period for each tranche was based on the U.S. Treasury yield curve as of the Grant
Date.
The Grant Date fair value of the IPO Founders Awards was $624 million. Stock-based compensation expense of
$17 million was recorded for the IPO Founders Awards during the three months ended March 31, 2026, and is
included in selling, general and administrative expenses in the condensed consolidated statements of operations. As
of March 31, 2026, the unrecognized stock-based compensation expense yet to be recognized over the vesting period
was $73 million in 2026, $98 million in 2027, $98 million in 2028, $98 million in 2029, $52 million in 2030, and
$189 million thereafter. The weighted average remaining life was 7.5 years as of March 31, 2026.
2016 Equity Incentive Plan
During 2016, the Company created the 2016 Equity Incentive Plan (“2016 Plan”), which allows for the issuance
of options to purchase shares of EquipmentShare common stock. The employees eligible to participate in the plan
are determined by the plan’s committee. Options are issued with an exercise price equal to the fair value of the
Company’s common stock and with vesting conditions as determined by the plan’s committee. Option awards with
time-based vesting conditions generally range from 12 to 48 months. Option awards with service, performance, and/
or market conditions, as defined, vest when those milestones are achieved (the “milestone-based awards”). Options
are generally forfeited upon termination or when performance or market conditions are not met, and forfeitures are
accounted for as they occur.
Stock Options
As of March 31, 2026, the Company has a total of 22,525,256 options authorized. There were 9,723,781
issued and outstanding 5,474,473 options were exercised or cancelled and not returned to the pool as of March 31,
2026, and 7,327,002 options available for issuance transferred to the 2025 Plan.
20
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Stock-based compensation expense of $1 million and $1 million was recorded for vested time-based options
during the three months ended March 31, 2026 and 2025, respectively, and is included in selling, general and
administrative expenses in the condensed consolidated statements of operations. As of March 31, 2026, the
unrecognized stock-based compensation expense yet to be recognized over the vesting period was $6 million. The
weighted average remaining life of the outstanding stock options was 1.6 years as of March 31, 2026.
compensation expense for milestone-based option awards was recognized during 2025 or 2026. The Company had
award milestones, as defined, are not achieved by January 31, 2032, then these unvested options will be forfeited.
The Company has not recognized stock compensation expense for these unvested stock options granted during 2022
as of March 31, 2026 because, for accounting measurement purposes, it is not highly probable that the performance
conditions will be achieved. The estimated unrecognized stock-based compensation expense to be recognized if and
when the performance conditions are considered highly probable of being achieved could be up to $0.4 million for
the 2022 awards as of March 31, 2026. The average remaining life of the outstanding milestone-based stock option
awards was 5.8 years for the 2022 awards as of March 31, 2026.
RSUs
The Company issued performance-based restricted stock units (“RSUs”) under the 2016 Plan with two-tiered
vesting conditions which include a service requirement and a liquidity event requirement. The service condition of
the RSUs will be met provided the participant is in continuous service over the defined period of time generally 12
to 48 months. The liquidity event requirement was satisfied on the effective date of the IPO. RSUs shall be settled
no later than March 15 of the calendar year following the calendar year in which each vesting event occurs. Upon
the consummation of the IPO, the performance-based vesting conditions for outstanding RSUs was satisfied. As a
result, the RSUs that had satisfied the service-based condition date had vested. For the three months ended March
31, 2026, the Company recognized $2 million of stock-based compensation expense attributable to RSUs. No stock-
based compensation expense attributable to RSUs was recognized for the three months ended March 31, 2025, as the
performance-based vesting condition had not been satisfied at that time. As of March 31, 2026, the unrecognized
stock-based compensation expense yet to be recognized over the vesting period was $3 million. The weighted
average remaining life of the outstanding RSUs was 1.2 years as of March 31, 2026.
21
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
12.REVENUE RECOGNITION
The Company recognizes revenue in accordance with two accounting standards: (1) Topic 842, which addresses
lease accounting, and (2) Topic 606, which addresses revenue from contracts with customers.
(In millions):
Three Months Ended March 31, | |||||||||||
2026 | 2025 | ||||||||||
Topic 842 | Topic 606 | Total | Topic 842 | Topic 606 | Total | ||||||
Equipment rental revenue ............................................. | $ | $ | $ | $ | $ | $ | |||||
Ancillary and other rental revenue: | |||||||||||
Delivery and pick-up ............................................... | |||||||||||
Other equipment rental ........................................... | |||||||||||
Total equipment rental and related services .................. | |||||||||||
Equipment sales (new and used)(1) ................................ | |||||||||||
Equipment parts, supplies, and services: | |||||||||||
Equipment parts and supplies sales ......................... | |||||||||||
Services ................................................................... | |||||||||||
Total equipment parts, supplies, and services ............... | |||||||||||
Platform revenue: | |||||||||||
Telematics ............................................................... | |||||||||||
Other ....................................................................... | |||||||||||
Total revenues ............................................................... | $ | $ | $ | $ | $ | $ | |||||
__________________
(1)For the three months ended March 31, 2026 and 2025, equipment sales to OWN Program participants were $102 million and $95 million,
respectively. For the three months ended March 31, 2026 and 2025, equipment sales to contractors and other end users were $77 million and
$50 million, respectively.
The Company's Equipment Rental and Services Operations segment revenue (see Note 18) is comprised of
equipment rental and related services and equipment parts, supplies, and services revenue presented in the table
above.
The disaggregation of the Company's revenue from contracts to customers as reflected above, coupled with the
reportable segment disclosures (see Note 18), depicts how the nature, amount, timing and uncertainty of the
Company's revenue and cash flows are affected by economic factors.
Equipment rental sublease income was $351 million and $245 million for the three months ended March 31,
2026 and 2025, respectively.
Revenue for lease arrangements with customers (Topic 842)
Equipment rental revenue: The Company is in the business of renting equipment that is owned by the Company
or rented from vendors, contractors, and others and then re-rented to the Company’s third-party customers. Such
arrangements are accounted for as operating leases with the Company as a lessor and governed by the standard
rental contract.
As a lessor of rental equipment to customers, revenue is recognized in the period earned on a straight-line basis
over the contract term, regardless of timing of billing to customers. A rental contract term can be daily, weekly, or
monthly (28 days), and is billed when the monthly rental charge is achieved, or at the completion of the rental
contract, whichever is sooner. From time to time, the Company provides an option for the lessee to purchase the
rented equipment at the end of the lease, however, the Company does not generate material revenue from sales of
equipment under such rental purchase option arrangements.
Equipment rental revenue includes revenue generated by the Company, as a sublessor, from equipment that is
owned by others who are participants in the Company’s OWN Program. Under the OWN Program, the owner’s
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
equipment is fully enabled with the Company’s T3 telematics and placed on the Company’s platform to be rented.
Rental revenue generated while the equipment is rented to the Company’s customers is shared between the
Company and the owner of the equipment. The Company may also provide other services under the OWN Program,
such as maintenance, insurance, and remarketing services. Rental revenue generated from the OWN Program is
divided between the Company and the owner of the equipment, and for the duration of the arrangement the
Company manages the owner’s equipment utilizing the T3 operating system.
Ancillary and other equipment rental revenues: Delivery fees charged are variable, based on the type of
equipment being delivered, the requested delivery time, the distance of the delivery and other relevant
considerations. Delivery occurs before the rental period begins and, therefore, delivery fees charged are recognized
over the monthly rental period.
Other equipment rental revenue is primarily comprised of (i) revenue generated from customers who purchase
rental insurance coverage to protect against potential damages or loss to the equipment rented and (ii) environmental
fees assessed on the rental asset. Rental insurance coverage revenue is recognized as revenue in the period earned on
a straight-line basis over the contract term, regardless of timing of billing to customers. Environmental fee revenue
is recognized in the period earned on a straight-line basis over the contract term.
Revenues from contracts with customers (Topic 606)
Pick-up services: Pick-up services are at the customer’s option after the lease has terminated, and control of the
asset no longer resides with the lessee. Accordingly, the Company recognizes revenue from pick-up services at the
point in time when the pick-up service has been provided, regardless of timing of billing to customers.
Fuel recovery fees: Similar to pick-up services, fuel recovery charges are at the customer’s option after the lease
has terminated, and control of the asset no longer resides with the lessee. Accordingly, fuel recovery fees, which are
included in other equipment rental, are recognized at the point in time when the customer elects the service and the
service has been provided by the Company.
Equipment sales (new and used) and equipment parts and supplies sales: The Company recognizes revenue on
sales of new equipment and used equipment, as well as revenue on sales of parts and supplies, at the point in time
when it has a contract in place and satisfies the performance obligation by transferring control of the product or
service to a customer. The amount of revenue recognized reflects the consideration the Company expects to be
entitled to in exchange for such products or services. The Company recognizes revenue on sales of new equipment,
used equipment, and parts and supplies when control has transferred to the customer, which is typically when the
asset is picked up, delivered to the customer, or when significant risks and rewards of ownership have passed to the
customer. In certain cases, the Company acts as the agent for the sale of new equipment, resulting in the new
equipment sales revenue being presented net of new equipment cost of revenues in the equipment sales revenue on
the accompanying condensed consolidated statements of operations. Otherwise, the Company presents new and used
equipment sales on a gross basis within equipment sales revenue and the related equipment sales cost of revenues on
the accompanying condensed consolidated statements of operations. As described above, the Company sells
equipment assets to other parties and may allow the purchaser of the equipment to place the equipment asset in the
OWN Program to be rented to the Company’s customers. Sales and other tax amounts collected from customers and
remitted to government authorities are accounted for on a net basis and excluded from revenue.
Service revenue: Service revenue is primarily comprised of (i) warranty services and (ii) maintenance services
and other miscellaneous services. Warranty services revenue represents compensation for the service work the
Company has performed on behalf of the OEM in order to fulfill the warranty extended by the OEM to the
customer. Warranty revenue and the related receivable are short-term in nature and revenue is recognized at the
point in time when the repair service has been provided by the Company. The Company acts as the principal in these
transactions and, therefore, warranty revenue earned and warranty expense incurred are presented on a gross basis
within revenues and cost of revenues in the accompanying condensed consolidated statements of operations.
Maintenance services and other miscellaneous services revenue represents compensation for maintenance work the
Company has performed for customers and is recognized at the point in time when the services are performed, or
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
under certain OWN Program arrangements, the Company has a stand-ready performance obligation to provide
maintenance services and revenue is recognized over the contract service period.
Telematics revenue: Telematics revenue includes (i) the sale of subscriptions to the Company’s telematics
services, which are recognized on a straight-line basis over the period corresponding to the telematics subscriptions
that are sold separately to customers; (ii) as an allocation of the transaction consideration from equipment rentals for
the non-lease component of the rental arrangements, which is recognized on a straight-line basis over time based on
the monthly period for equipment rentals; or (iii) the sale of custom electronic components, including telematics
tracker devices and cloud-based access control keypads.
Other: Other platform revenue includes sales of building materials and hardware supplies, which are recognized
at a point in time when the products are purchased and picked up by the customer from one of the Company’s store
locations.
Contract assets and liabilities
The Company does not have material contract assets or material contract liabilities associated with contracts
with customers. The Company’s contracts with customers do not result in material amounts billed to customers in
excess of recognizable revenue. The Company did not recognize material revenues during the three months ended
March 31, 2026 or 2025 that were contract liabilities at the beginning of such periods.
13.INCOME TAXES
The benefit for income taxes was $32 million and $19 million for the three months ended March 31, 2026 and
2025, respectively. Although the Company incurred a loss in the current interim period, it anticipates generating
taxable income for the full fiscal year. Accordingly, the estimated annual effective tax rate reflects the expected full-
year income and related expense. Differences between applicable federal and state statutory tax rates and the
effective income tax rates for the income tax benefit recorded by the Company are primarily due to nondeductible
expenses and the Texas franchise tax, offset by research and development tax credits.
14.RELATED PARTY TRANSACTIONS
Transactions with Investee
The Company has a 50.1 % ownership interest in 10G, a joint venture arrangement accounted for under the
equity method. For the three months ended March 31, 2026, the Company recognized revenue from sales to 10G of
$8 million, which is included in telematics platform revenue on the condensed consolidated statements of
operations. At March 31, 2026 and December 31, 2025, the Company had amounts due from 10G of $4 million and
$2 million, respectively, which are included in accounts receivable on the condensed consolidated balance sheets,
and amounts owed to 10G of $0.3 million and $0.2 million, respectively, which are included in accounts payable on
the consolidated balance sheets.
The Company holds a 26.95 % noncontrolling interest in Powers Group, Inc. (“Powers”), a third-party insurance
agency that provides customers with a range of personal and business insurance policies and related services. The
Company purchases insurance coverage through a wholly owned subsidiary of Powers, acting as an agent. For the
three months ended March 31, 2026 and 2025, the Company purchased insurance policies through this equity
method investee and recognized $3 million and $2 million of insurance expense in selling, general and
administrative expenses on the condensed consolidated statements of operations, respectively. At March 31, 2026
and December 31, 2025, the Company had $3 million and $2 million of prepaid insurance related to these policies,
respectively, which are included in prepaid costs on the condensed consolidated balance sheets.
The Company purchased telematics tracker devices from an equity method investee totaling approximately $4
million for the three months ended and March 31, 2025. Design and development services paid to the same equity
method investee were $0.3 million for the three months ended March 31, 2025, and included in selling, general and
administrative expenses on the condensed consolidated statements of operations.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Transactions with Entities Owned or Controlled by the Founders
The Company has entered into various transactions with related party entities either owned or controlled by the
Company’s Chief Executive Officer or President.
Revenues
During the three months ended March 31, 2026 and 2025, the Company recognized the following revenues
from transactions with entities owned or controlled by the Founders:
•Approximately $1 million of equipment rental and related services revenues, including equipment rental
revenues whereby the Company acts as an agent in the rental arrangement during the three months ended
March 31, 2025. There were no such amounts during the three months ended March 31, 2026..
•Equipment sales revenue of $102 million during the three months ended March 31, 2025. There were no
such amounts during the three months ended March 31, 2026. A portion of the equipment sales for the three
months ended March 31, 2025, were agent OEM transactions and the related cost of the equipment sold of
$42 million is presented net of the associated equipment sales revenues for these periods on the
consolidated statements of operations. The equipment sold was subsequently listed on the Company’s
marketplace under the OWN Program.
•$0.1 million and $2 million, respectively, of equipment parts, supplies and services revenues; and zero and
$0.1 million, respectively, of T3 telematics services revenues relating to equipment enrolled under the
OWN Program.
In addition, the Company recognized $0.1 million and zero for the three months ended March 31, 2026 and
2025, respectively, in sales of building materials and hardware supplies to the Founders, which are included in other
platform revenues on the condensed consolidated statements of operations.
OWN Program payouts
OWN Program payouts to entities owned or controlled by the Founders were $0.3 million and $12 million for
the three months ended March 31, 2026 and 2025, respectively, included in cost of revenues on the condensed
consolidated statements of operations. At March 31, 2026 and December 31, 2025, there were no
under the OWN Program due to entities owned or controlled by the Founders.
Assignment of property site purchase rights and construction developer fees
For the three months ended March 31, 2026 and 2025, the Company recognized $1 million and $2 million,
respectively, of other miscellaneous income for the assignment of new property site purchase rights and related
transaction services and $2 million and $1 million, respectively, for construction developer fees provided to entities
owned or controlled by the Founders. These amounts are included in other income, net on the condensed
consolidated statements of operations.
Accounts receivable and other current assets
At March 31, 2026 and December 31, 2025, the Company had receivables due from entities owned or
controlled by the Founders related to the transactions described above in the amounts of $16 million and $19
million, respectively, which are included in accounts receivable or other current assets on the condensed
consolidated balance sheets.
Leases
The Company leases or has leased certain properties, facilities, vehicles, and aircraft for its operations under
various lease arrangements with entities owned or controlled by the Founders. Lease expenses associated with
various operating lease arrangements with entities owned or controlled by the Founders were $0.3 million and $2
million for the three months ended March 31, 2026 and 2025, respectively, which are included in direct operating
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
costs or selling, general and administrative expenses on the condensed consolidated statements of operations. At
March 31, 2026, the Company had operating lease right of use assets and operating lease liabilities under lease
arrangements with entities owned or controlled by the Founders of $7 million and $7 million, respectively. At
December 31, 2025, the Company had operating lease right of use assets and operating lease liabilities under lease
arrangements with entities owned or controlled by the Founders of $6 million and $6 million, respectively.
The Company recognized variable lease expense, short-term rental expense, and other miscellaneous expenses,
which are included in direct operating costs or selling, general and administrative expenses on the condensed
consolidated statements of operations, of $1 million and $0.3 million for the years ended March 31, 2026 and 2025,
respectively, primarily relating to certain leases and short-term rentals from entities owned or controlled by the
Founders.
During the three months ended March 31, 2026 and 2025, the Company made payments of $1 million and $1
million under property finance lease arrangements with entities owned or controlled by the Co-Founders,
respectively. At March 31, 2026 and December 31, 2025, the Company had finance lease liabilities under finance
lease arrangements with entities owned or controlled by the Founders of $32 million and $29 million, respectively.
Purchases of rental equipment, parts, supplies and other
During the three months ended March 31, 2025, the Company purchased $1 million of equipment previously
enrolled in the OWN Program from entities owned or controlled by the Founders. The equipment purchased was
added to the Company’s rental fleet, and is included in rental equipment, net, on the condensed consolidated balance
sheets.
Purchases of property and other fixed assets
During the three months ended March 31, 2026 and 2025, entities owned or controlled by the Founders
provided construction services to the Company in the amounts of $0.4 million and $1 million, respectively, which
were capitalized to property and other fixed assets.
Accounts payable
At March 31, 2026 and December 31 2025, amounts due to entities owned or controlled by the Founders were
$0.4 million and $0.4 million, respectively, which are included in accounts payable on the condensed consolidated
balance sheets.
Cash equivalents
During the three months ended March 31, 2025, the Company deposited $5 million into a money market
account at a financial institution in which the Founders have an ownership interest. As of March 31, 2026 and
December 31, 2025, the Company had an aggregate of $21 million and $21 million, respectively, on deposit in a
money market account with this financial institution, which is included in cash and cash equivalents on the
condensed consolidated balance sheets. For the three months ended March 31, 2026 and 2025, the funds on deposit
earned $0.2 million and $0.1 million of interest income, respectively, which is included in other income, net on the
condensed consolidated statements of operations.
The Company does not provide any financial support or guarantee any debt of the related party entities involved
in the transactions described above.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
15.FAIR VALUE MEASUREMENTS AND OTHER
assets) are categorized in the fair value hierarchy as follows (In millions):
March 31, 2026 | |||||||
Level 1 | Level 2 | Level 3 | Total | ||||
Cash equivalents .......................................................... | $ | $ | $ | $ | |||
Short-term investments: | |||||||
Mutual funds ........................................................... | |||||||
Equity securities ..................................................... | |||||||
Common stocks ...................................................... | |||||||
Corporate bonds ...................................................... | |||||||
U.S. government bonds .......................................... | |||||||
Real estate investment trust .................................... | |||||||
Total ............................................................................. | $ | $ | $ | $ | |||
December 31, 2025 | |||||||
Level 1 | Level 2 | Level 3 | Total | ||||
Cash equivalents .......................................................... | $ | $ | $ | $ | |||
Short-term investments: | |||||||
Mutual funds ........................................................... | |||||||
Equity securities ..................................................... | |||||||
Common stocks ...................................................... | |||||||
Corporate bonds ...................................................... | |||||||
U.S. government bonds .......................................... | |||||||
Real estate investment trust .................................... | |||||||
Total ............................................................................. | $ | $ | $ | $ | |||
The carrying amounts presented on the condensed consolidated balance sheets for accounts receivable, accounts
payable, and other liabilities approximate their fair values due to the short-term maturity of these financial
instruments.
The fair values of long-term debt, excluding the Company’s Notes, approximate their book values as of
March 31, 2026 and December 31, 2025. The aggregate fair value of the Company’s Notes which are categorized in
Level 2 of the fair value hierarchy, is estimated based on observable inputs other than quoted prices in active
markets and approximated $2,212 million and $2,237 million as of March 31, 2026 and December 31, 2025,
respectively.
Investments in equity securities in which the Company does not have significant influence of $29 million and
$29 million as of March 31, 2026 and December 31, 2025, respectively, are carried at cost under the measurement
alternative for equity investments that do not have readily determinable fair values. Investments in equity securities
in which the Company has significant influence, but not control, of $31 million and $30 million as of March 31,
2026 and December 31, 2025, respectively, are carried under the equity method. These amounts are reported as
Investments in non-consolidated affiliates on the accompanying condensed consolidated balance sheets.
The Company recognized $1 million and $0.4 million of realized and unrealized gains on short-term
investments and investments in non-consolidated affiliates during the years ended March 31, 2026 and 2025,
respectively, which are included in other income, net on the condensed consolidated statements of operations.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
The Company recognized $2 million and $2 million of interest income from interest bearing cash and money
market accounts during the years ended March 31, 2026 and 2025, respectively, which are included in other income,
net on the condensed consolidated statements of operations.
16.ACQUISITIONS
The Company accounts for business combinations using the acquisition method as defined in FASB ASC
Topic 805, Business Combinations. Management uses its best estimates and assumptions to value the assets acquired
and liabilities assumed at the acquisition date. Such estimates are inherently uncertain and may be subject to
refinement. As a result, during the measurement period of up to one year from the acquisition date, the Company
may record adjustments to the acquisition accounting, to the extent new information becomes available.
Building Materials and Hardware Retail Stores
During the three months ended March 31, 2026, the Company, through its wholly owned subsidiaries, entered
into two separate purchase agreements to acquire substantially all of the business operations of three building
supplies, lumber, and hardware retail stores for an aggregate purchase price of $1 million. No goodwill resulted from
these transactions. The purchase price was preliminarily allocated to the estimated fair value of net assets acquired
as of their respective acquisition dates of $1 million. Assuming the acquisition of these businesses were
consummated as of January 1, 2025, the pro forma effect on revenue and earnings are not material to the condensed
consolidated financial statements.
Carbide Tooling and Industrial Supply, Inc.
On January 21, 2026, the Company entered into purchase agreements to acquire substantially all of the assets
and business operations of an industrial supplier business known as Carbide Tooling and Industrial Supply, located
in Waller, Texas, for an aggregate purchase price of $6 million. The purchase price was preliminarily allocated to
the estimated fair value of net assets acquired of $5 million and $1 million to goodwill, respectively. The goodwill
relating to these acquisitions is expected to be deductible for income tax purposes over a fifteen year period.
Assuming the acquisition of these businesses had occurred as of January 1, 2025, the pro forma effect on revenue
and earnings would not have been material to the condensed consolidated financial statements.
17.COMMITMENTS AND CONTINGENCIES
From time to time, the Company is involved in various claims and legal actions. These matters include, but are
not limited to, claims arising from the operation of rented equipment, workers' compensation claims, and alleged
breaches of obligations of certain employees to former employers. Management believes that such claims and legal
actions taken against the Company are without merit and the Company intends to vigorously defend itself in these
cases. Management is of the opinion that the ultimate resolution of any ongoing litigation and related matters,
individually or in the aggregate, will not have a material adverse effect on the Company’s condensed consolidated
financial position, results of operations, or cash flows.
18.SEGMENT INFORMATION
The Company has two reportable segments: (1) Equipment Rental and Services Operations, and (2) Equipment
Sales. Equipment Rental and Services Operations are comprised of recurring activity performed at the Company's
full-service branch locations, such as equipment rentals and related services (including allocated telematics revenue
related to rental customer access to the T3 platform), and sales of parts, supplies and maintenance services to
construction contractors and others. Equipment Sales are comprised of sales by the Company of new or used
equipment made at any of the Company's branch locations and dealership sites, including equipment sales to
participants in the OWN Program. All other business activities, which include telematics SaaS subscriptions,
software applications, and related telematics devices purchased by customers for their owned fleet, as well as
building materials and hardware supplies, are included in “All Other.” The Company generates all of its revenue in
the U.S. and all long-lived assets are located in the U.S.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
These segments are based upon revenue streams and how the chief operating decision maker (“CODM”) of the
Company allocates resources and assesses performance. The Company’s Chief Executive Officer is the CODM. The
CODM uses Segment Adjusted EBITDA to make resource allocation decisions and to assess the performance of
these segments. The CODM uses Segment Adjusted EBITDA to evaluate segment performance without regard to
potential distortions and to assess period-over-period growth. Excluding OWN Program payouts and equipment
operating lease expense from Equipment Rental and Services Operations Segment Adjusted EBITDA provides the
CODM with a more meaningful metric to compare operating performance to industry peers who do not source their
equipment fleet through lease arrangements. The most significant decisions made by the CODM relate to site
expansion, capital deployment, and employee hiring, among other things.
Significant expenses regularly provided to the CODM and reported in Segment Adjusted EBITDA include
segment cost of revenues and segment selling, general, and administrative expenses. Segment cost of revenues for
the Equipment Rental and Services Operations segment includes direct operating costs, excluding equipment and
vehicle operating lease expense. Segment cost of revenues for the Equipment Sales segment includes the cost of
equipment sales. Segment cost of revenues for All Other business activities includes platform expenses. Segment
Adjusted EBITDA also excludes operating expenses related to OWN Program payouts, depreciation expense on
rental equipment, and amortization expense on capitalized software. Segment selling, general and administrative
expenses exclude depreciation expense related to the Company’s property and other fixed assets, and during the first
quarter of 2026, on a prospective basis, segment selling, general and administrative expenses exclude stock-based
compensation expense, following a change in the information regularly reviewed by the CODM. There are no other
significant segment expenses.
The accounting policies of the reportable segments are consistent with those described in Note 2: Summary of
Significant Accounting Policies in the Company’s Audited Consolidated Financial Statements as of and for the year
ended December 31, 2025. Certain corporate selling, general and administrative expenses, including corporate
employee compensation, technology costs, professional service fees, and insurance expenses are deemed to be of an
operating nature and are allocated to each segment based primarily on segment employee headcount. There were no
sales or transactions between segments for any of the periods presented. The Company retains various unattributed
assets at the general corporate level, which the Company refers to as “Shared Resources” in the table below. Assets
identified as Shared Resources primarily consist of cash, investments, property and other fixed assets and property
right of use assets. All other costs and assets are directly attributable to the segments. The Company does not
compile discrete financial information for segments other than the information presented below.
Three Months Ended March 31, 2026 | |||||||
Equipment Rental | |||||||
and Services | Equipment | ||||||
Operations | Sales | All Other | Total | ||||
Equipment rental, parts, supplies and services ............... | $ | $ | $ | $ | |||
Equipment sales ............................................................. | |||||||
Telematics ...................................................................... | |||||||
Sales of building materials, small tools, and hardware supplies ....................................................................... | |||||||
Total revenues ................................................................ | $ | $ | $ | $ | |||
Significant expenses: | |||||||
Segment cost of revenues ......................................... | |||||||
Segment selling, general and administrative expenses ................................................................. | |||||||
Segment Adjusted EBITDA ........................................ | $ | $ | $( | $ | |||
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Three Months Ended March 31, 2025 | |||||||
Equipment Rental | |||||||
and Services | Equipment | ||||||
Operations | Sales | All Other | Total | ||||
Equipment rental, parts, supplies and services ............... | $ | $ | $ | $ | |||
Equipment sales ............................................................. | |||||||
Telematics ...................................................................... | |||||||
Sales of building materials, small tools, and hardware supplies ....................................................................... | |||||||
Total revenues ................................................................ | $ | $ | $ | $ | |||
Significant expenses: | |||||||
Segment cost of revenues ......................................... | |||||||
Segment selling, general and administrative expenses ................................................................. | |||||||
Segment Adjusted EBITDA ........................................ | $ | $ | $( | $ | |||
Three Months Ended March 31, | |||
2026 | 2025 | ||
Segment Adjusted EBITDA ............................................................................. | $ | $ | |
Equipment operating lease expense .................................................................. | ( | ( | |
OWN Program payouts .................................................................................... | ( | ( | |
Depreciation expense on rental equipment ....................................................... | ( | ( | |
Depreciation expense on property and other fixed assets ................................. | ( | ( | |
Amortization expense on capitalized software and intangible assets ............... | ( | ( | |
Stock-based compensation expense .................................................................. | ( | ||
Interest expense ................................................................................................ | ( | ( | |
Other income, net ............................................................................................. | |||
Loss before benefit from income taxes ............................................................. | $( | $( | |
March 31, 2026 | December 31, 2025 | ||
Segment identified assets: | |||
Equipment Rental and Service Operations ..................................... | $ | $ | |
Equipment Sales .............................................................................. | |||
All Other ......................................................................................... | |||
Shared Resources ............................................................................ | |||
Total assets ...................................................................................... | $ | $ |
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
millions):
March 31, 2026 | March 31, 2025 | ||||||
Equipment | Equipment | ||||||
Rental and | Rental and | ||||||
Services | Equipment | Services | Equipment | ||||
Operations | Sales | Operations | Sales | ||||
Cash flows from investing activities: | |||||||
Purchases of rental equipment ................ | $( | $ | $( | $ | |||
Proceeds from sale of rental equipment .. | |||||||
19.EARNINGS PER SHARE
Basic earnings per share is calculated using the two-class method as the Company’s convertible preferred stock
is considered a participating security because these shares participate in dividends on an as-converted basis with
common stock, and for the three months ended March 31, 2026, the Company has two classes of common stock,
which are referred to as Class A common stock and Class B common stock. On January 26, 2026, concurrent with
the IPO, all outstanding shares of the Company’s convertible preferred stock were converted into Class A common
stock and all shares of Class A common stock then held by the Founders were exchanged into an equivalent number
of shares of Class B common stock. Income and losses are shared pro-rata between the two classes of common
stock. The two-class method requires an allocation of earnings to all classes of common stock and participating
securities. Basic earnings per share is calculated by dividing net income (loss) attributable to common shareholders
by the weighted average number of common shares outstanding for the period. The participating securities are not
required to participate in the losses of the Company, and therefore during periods of loss there is no allocation
required under the two-class method between common and participating securities. The Company calculated diluted
earnings per share using the more dilutive of either the two-class, if-converted method or the treasury stock method.
For the three months ended March 31, 2026 and 2025 the two-class, if-converted method and the treasury stock
method yielded the same result. Diluted earnings per common share is computed by dividing net (loss) income
attributable to common shareholders by the weighted average number of common shares plus the effect of dilutive
potential common shares outstanding during the period.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Three months ended March 31, | |||||
2026 | 2025 | ||||
Class A | Class B | Common Stock | |||
Basic earnings per common share: | |||||
Allocation of net loss ....................................................................... | $( | $( | $( | ||
Less: Deemed dividends on perpetual preferred stock .................... | ( | ( | ( | ||
Less: Earnings allocated to participating securities ......................... | |||||
Net loss attributable to common shareholders ................................. | ( | ( | ( | ||
Weighted average common shares outstanding - Basic ................... | |||||
Basic loss per common share ........................................................... | $( | $( | $( | ||
Three months ended March 31, | |||||
2026 | 2025 | ||||
Class A | Class B | Common Stock | |||
Diluted earnings per common share: | |||||
Allocation of net loss | $( | $( | $( | ||
Less: Deemed dividends on perpetual preferred stock | ( | ( | ( | ||
Net loss attributable to common shareholders | ( | ( | ( | ||
Weighted average common shares outstanding - Diluted | |||||
Diluted loss per common share | $( | $( | $( | ||
Employee stock options of 6,422,297 and 5,335,661 were excluded from the calculation of diluted earnings per
share for the three months ended March 31, 2026 and 2025, respectively, as a result of their anti-dilutive effect. In
addition, convertible preferred shares of 36,099,070 and 141,989,676 , which are considered participating securities,
were excluded from the calculation of diluted earnings per share for the three months ended March 31, 2026 and
2025, respectively, as a result of their anti-dilutive effect. IPO Founders Awards of 4,836,914 were excluded from
the calculation of diluted earnings per share for the three months ended March 31, 2026, as a result of their anti-
dilutive effect.
20.SUBSEQUENT EVENTS
On April 15, 2026, the ABL Credit Facility was amended to, among other things, add certain defined terms and
clarifications with respect to the required timing of repayment of outstanding borrowings, when certain conditions
are met, following the receipt by the Company of net cash proceeds from equipment sales to OWN Program
participants.
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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
You should read the following discussion of our financial condition and results of operations in conjunction
with our unaudited condensed consolidated financial statements, including the notes thereto, included elsewhere in
this Form 10-Q. In addition to historical information, the following discussion and analysis contains forward-
looking statements that reflect our plans, estimates, and beliefs. Our actual results and the timing of events could
differ materially from those anticipated in the forward-looking statements. Factors that could cause or contribute to
these differences include those discussed below and under Part I, Item 1A, “Risk Factors” in our 2025 Form 10-K
particularly in the “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” sections.
Overview
We are a leading tech-enabled construction solutions provider dedicated to enabling job sites to run more
productively and safely. Through our rental service and retail centers, we offer our customers a comprehensive
portfolio of equipment asset management solutions enabled through our T3 platform, which we believe is the
leading sensor-to-cloud fleet management tool in the commercial construction industry and which provides value-
added services to our customers by managing people, assets, and materials in real time.
We are one of the largest and fastest-growing equipment rental providers in the U.S. based on revenue. As of
March 31, 2026, we operated 371 full-service branch locations, 9 standalone dealership sites, and 27 building
materials and hardware retail stores across 45 states, with a diversified managed fleet portfolio of more than 262,000
pieces of equipment and approximately 357,000 trackers operating on our T3 platform. As of March 31, 2026, we
had 8,502 employees who support us in solving industry inefficiencies by providing smart jobsite technology, as
well as operating our equipment rental and retail and service centers.
Our rental fleet, including support vehicles and trailers, consists of equipment that we (i) own, (ii) lease as
lessee under operating lease arrangements with third-party lessors such as an Original Equipment Manufacturer
(“OEM”) and financial institutions, or (iii) lease as lessee under our OWN Program. As of March 31, 2026, 179,322
pieces of equipment were owned by us; 848 pieces of equipment were leased by us as a lessee under operating lease
arrangements with third parties such as OEMs and financial institutions; and 82,480 pieces of equipment were
leased by us as lessee, and rented by us to our customers, under our OWN Program. Leased equipment refers to
equipment subject to operating lease contracts with third parties such as OEMs and financial institutions in which
we have contracted use of the equipment for a defined period. OWN Program equipment refers to equipment sold to
OWN Program participants and subsequently leased back and operated by us under the OWN Program lease and
revenue-sharing structure. Both leased and OWN Program equipment are part of our equipment under management.
Our Business Activities and Operating Environment
We are engaged principally in the business of renting equipment that is managed by and fully enabled with our
T3 platform. This includes equipment that we own, lease, or is rented from third parties through our OWN Program.
Ancillary to our principal business of equipment rental and related services, we also sell used rental equipment, sell
new equipment and consumables, and offer certain services and support to our customers.
We operate our business through the following reportable segments: (i) Equipment Rental and Services
Operations, comprised of recurring activity performed at our full-service branch locations, such as equipment rentals
and related services (including allocated telematics revenue related to rental customer access to the T3 platform),
and sales of parts, supplies and maintenance services to construction contractors and others, and (ii) Equipment
Sales, comprised of sales by us of new or used equipment made at any of our branch locations and dealership sites,
including equipment sales to participants in the OWN Program. All other business activities include telematics SaaS
subscriptions, software applications, and related telematics devices purchased by customers for their owned fleet, as
well as building materials and hardware supplies.
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Key Factors Affecting Our Performance
Demand for Construction Equipment. Our business is primarily impacted by the demand in the U.S. for
construction equipment for use in non-residential, infrastructure, governmental, industrial, and residential
construction, demolition, maintenance, energy operations, and other construction activities. Demand levels for heavy
construction equipment are particularly dependent on the expected level of major infrastructure construction and
repair projects, which is a function of expected economic growth and government spending.
We expect to benefit if tariffs lead to onshoring of manufacturing and result in construction of new facilities, but
our results will be negatively affected if construction of energy transition infrastructure is reduced due to lower
subsidies or other factors.
Seasonality and Weather Conditions. The rental of construction equipment is seasonal, which causes our
quarterly results and our available cash flow to fluctuate during the year. Our customers generally purchase and rent
equipment in preparation for, or in conjunction with, their busy season, which is typically late spring to November.
However, weather conditions impact the timing of our customers’ busy season, which may cause greater than
expected fluctuations in our quarterly financial results year over year. Seasonal weather trends, particularly severe
wet or dry conditions, can have a significant impact on regional construction market performance by affecting the
ability to undertake construction projects. In addition, numerous external factors such as credit markets, government
subsidies and tariffs, commodity prices, and other circumstances may disrupt normal rental and/or purchasing
practices and sentiment, further contributing to the fluctuations.
Moreover, because equipment sale transactions with OWN Program participants occur unevenly throughout the
year, depending on demand, period-over-period comparisons may not reflect underlying trends. These transactions
may also result in a higher percentage of our revenue being attributable to an OWN Program participant for the
period during which one or more equipment sale transactions with such party occurred. The OWN Program has
consistently attracted strong demand across multiple, sources of capital, including institutional investors who
purchase as a buying group through a collective vehicle and finance their equipment purchases through asset-backed
securities (“ABS”). To satisfy this demand, the Company has organized for these investors sales of large packages
of equipment and has conducted these sales on an episodic basis. Accordingly, period-over-period comparisons may
not reflect underlying trends and fluctuations in our operating results and makes it difficult for us to predict our
future operating results.
Costs of Equipment and Inflation. Significant changes in the purchase price or residual values of equipment or
interest rates can have a significant effect on our profitability depending on our ability to adjust pricing for these
changes. Inflationary pressures and other factors have led to increases in the prices of some equipment and products
that we purchase, and in the costs of our operations, which may be partially offset by increases in the prices we
charge our customers. A sizeable portion of the equipment we lease as lessee through our OWN Program is owned
by third parties who have financed equipment purchases through the issuance of ABS, and a reduction in residual
values could trigger liquidation events for these OWN Program participants and may require them to sell their
construction equipment, which may cause a disruption in our ability to lease and re-rent the construction equipment
to our customers.
Our profitability is dependent upon a number of other factors, including the volume, mix, and pricing of rental
transactions, and the utilization of equipment.
Our business requires significant expenditures for equipment, and we require substantial liquidity and/or access
to capital to finance such expenditures. See “—Liquidity and Capital Resources” below.
Geographic and Fleet Expansion
Our geographic expansion of full-service equipment rental branch locations, and the corresponding increase in
total equipment rental fleet size as we supply new branch locations, is one of the primary factors affecting our
results. The additional branch locations and rental fleet, combined with equipment sales, were the primary drivers
for total revenue increasing from $716 million for the three months ended March 31, 2025 to $989 million for the
three months ended March 31, 2026, or at an annual growth rate of 38%.
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In line with customer demand and our growth strategy, we have increased the number of full-service equipment
rental branch locations from 292 as of March 31, 2025 to 371 as of March 31, 2026, an increase of 79 new full-
service equipment rental branch locations. In conjunction with the opening of these new full-service equipment
rental branch locations, we incurred $50 million and $55 million of new market startup costs during the three
months ended March 31, 2026 and 2025, respectively.
We correspondingly increased our fleet size from 207,366 units of equipment under management as of
March 31, 2025 to 262,650 as of March 31, 2026, reflecting the growth in original equipment cost (“OEC”) under
management, which includes equipment we own and rent to customers, as well as equipment owned by third parties
and leased by us, as lessee through our OWN Program, and re-rented to customers, from $7,013 million as of
March 31, 2025 to $9,065 million as of March 31, 2026, or an increase of 29%.
Expansion of OWN Program
The growth in our business through geographic and fleet expansion has been partially achieved through the
execution of our strategy to expand our OWN Program. Under the OWN Program, participants may purchase from
us new or used (typically less than four years old) equipment which is fully enabled with T3. Concurrently, we enter
into a lease arrangement with the participant whereby we are the lessee and this qualified equipment is placed on our
T3 platform, to be rented to third party users. Rental revenue generated from equipment enrolled under the OWN
Program is divided and shared between us and the owner of the equipment, and for the duration of the arrangement
we manage the owner’s equipment utilizing the T3 platform.
Amounts we pay to OWN Program participants to lease their equipment are presented as OWN Program
payouts within cost of revenues. At the end of the sharing period under the OWN Program, we may assist the owner
with remarketing services if the equipment is to be sold in the market as used construction equipment. We also offer
several add-on services to the owner of the equipment. Participants in the OWN Program include institutional
investors and ABS entities, high-net-worth individuals, family offices, and other third parties.
Revenue earned from equipment that is in the OWN Program has no depreciation expense or interest expense
for us because we do not own, and therefore do not finance, such equipment. Thus, we have been able to implement
this portion of our managed fleet growth without taking on additional debt and increasing our debt costs. When
rental equipment is enrolled in the OWN Program, rather than purchased and owned by us, we incur lease expense
in the form of OWN Program payouts, which are recorded as cost of revenues, instead of depreciation expense and
interest expense associated with rental equipment that is purchased. OWN Program payouts were $217 million and
$154 million for the three months ended March 31, 2026 and 2025, respectively. This expansion increases cost of
revenues (before depreciation expense) and decreases depreciation expense and interest expense, which affects gross
profit (before depreciation expense), EBITDA (which we define and calculate as net income before interest expense,
income taxes, depreciation expense and amortization expense, and non-cash stock compensation expense), and
EBITDA margins. We expect to further increase our usage of the OWN Program, which will increase OWN
Program payouts in cost of revenues and reduce gross profit (before depreciation) and EBITDA margins, as
compared to rental equipment that is purchased and placed in our rental fleet. In addition, OWN Program payouts
plus depreciation have grown at a faster rate than the growth of revenue. Total equipment rental fleet OEC under the
Company’s management increased $2,052 million, or 29%, from $7,013 million as of March 31, 2025 to $9,065
million as of March 31, 2026. The total equipment rental fleet OEC enrolled in the OWN Program grew by $1,414
million, or 39%, Company-owned equipment rental fleet OEC grew by $717 million, or 22%, and the equipment
rental fleet OEC under operating leases decreased by $79 million during the same period. During the three months
ended March 31, 2026, OWN Program payouts increased 41% compared to the three months ended March 31, 2025;
of that increase, 41% was attributed to the growth of the average equipment rental fleet OEC enrolled in the OWN
Program. Because the OWN Program payouts are variable and primarily based on the amount of rental revenue
generated by the applicable equipment during the period, changes in demand from our customers for specific types
of rental equipment affects the amount of equipment rental and related services revenue generated.
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Components of Revenues and Expenses
Our revenues are primarily derived from the rental or sale of construction equipment, as well as related parts,
supplies and services, and consist of:
•Equipment rental and related services (includes revenue associated with the rental of equipment including
ancillary revenue from equipment delivery and pickup, rental protection plans, and fueling charges);
•Sales of new or used rental equipment and sales of new equipment, including revenue from equipment sales
subsequently listed on our marketplace under the OWN Program;
•Sales of equipment parts, supplies, and services (primarily relating to warranty services and maintenance
and repair services provided to customers); and
•Sales that we call “platform revenue,” which includes telematics software-as-a-service and related hardware
revenues, as well as the sale of building materials, small tools and construction supplies at our retail
locations.
Our expenses primarily consist of:
•Direct operating costs (primarily costs incurred at our rental branch locations that collectively support our
Equipment Rental and Services Operations segment, including, but not limited to, wages and related
benefits, service costs in connection with our rental equipment, site operating costs, pickup and delivery
expenses in connection with rental equipment, maintenance, fuel, parts, and supplies);
•OWN Program payouts;
•Equipment sales cost of revenues;
•Platform expense;
•Depreciation and amortization expense relating to equipment used in operations and capitalized software;
•Selling, general and administrative expenses; and
•Interest expense.
Our revenues and expenses are described in more detail below.
Revenues
Equipment Rental and Related Services
Our core service is the rental of equipment to customers on a daily, weekly, and monthly basis, enabled by our
T3 platform. The equipment we rent includes company-owned equipment, equipment we lease as a lessee, and
equipment that is leased from other parties in the OWN Program and re-rented to customers. We generate rental
revenue from equipment that is in our OWN Program by leasing equipment from owners on a month-to-month or
longer basis and then renting that equipment to our customers. Under nearly all of our OWN Program contracts, we
have control over the equipment and the equipment owner is not able to redeploy or retrieve the equipment while
under rent. Depending on the terms and conditions, we present rental revenue that we generate and OWN Program
payouts that we incur on OWN Program contracts either on a gross basis or a net basis.
In addition to equipment rental revenue, including from our OWN Program, we also generate revenue from
rental customers from the sale of rental protection plan (“RPP”) services designed to protect them from potential
damage or loss to the equipment they rent, environmental fees assessed on the rental asset and fuel recovery fees that
we charge to our customers.
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Equipment Sales
We have established a retail process to sell new and used equipment as a recurring part of our business. In
addition, we sell equipment assets to third parties, including third parties who have financed equipment purchases
through the issuance of ABS, and allow the customer to place the equipment in our OWN Program to be rented to
our customers. We sell new and used equipment through a variety of channels, including retail sales to customers
and other third parties, sales to wholesalers, brokered sales, and auctions. We generate revenue from the sale of new
and used equipment, which we present net of sales and other tax amounts collected from customers and remitted to
government authorities. When we act as agent in connection with the sale of new equipment to, for example, a
contractor or an OWN Program participant, among other reasons, we present revenue from the sale of such
equipment net in our consolidated statements of net income. When we are the principal in the transaction, we present
revenue from the sale of equipment on a gross basis, with sales revenue included in equipment sales revenue and the
related cost of revenues included in equipment sales cost of revenues in our consolidated statements of net income.
Equipment Parts, Supplies, and Services
As an integral part of our Equipment Rental and Services Operations, we sell equipment parts and supplies and
provide maintenance, and repair services to customers, as well as the owners of equipment who are participants in
our OWN Program. Revenue generated from the sale of equipment parts and supplies is presented net of sales and
other tax amounts collected from customers and remitted to government authorities. We also generate revenue from
the provision of ad hoc and preventative maintenance, and repair services to our customers, as well as warranty
repairs. We provide warranty repair services on behalf of OEMs in order to fulfill the warranty extended by OEMs
to their customers. Revenue that we generate from warranty repair services represents compensation for the service
performed by us and is presented on a gross basis.
Platform Revenue
Platform revenue is comprised of revenue from telematics services and the sale of custom electronic
components, including telematics tracker devices and cloud-based access control keypads, and revenue from
building materials and hardware supplies. Revenue from telematics is generated through monthly subscriptions to
our T3 platform and its full suite of capabilities, which we provide to our customers as a SaaS subscription. In
addition, our equipment rental arrangements also provide customers with access to our T3 platform and we allocate
a portion of the transaction consideration from equipment rentals to telematics revenue. Our T3 platform provides
customers with access to proprietary digital tools to help manage their jobsites more productively and safely and
enables customers to streamline maintenance and prevent theft, and equipment misuse. Our T3 platform also enables
equipment owners with subscriptions to place their equipment on our OWN Program to be rented to our customers.
Revenue from building materials and hardware supplies is derived from the sale of such materials and supplies at
our retail stores.
Cost of Revenues
Direct Operating Costs
Direct operating costs include the costs that we incur at our rental branch locations that collectively support our
Equipment Rental and Services Operations segment, including, but not limited to, wages and related benefits,
service costs in connection with our rental equipment, site operating costs, pickup and delivery expenses in
connection with rental equipment, maintenance, fuel, parts, and supplies.
OWN Program Payouts
Amounts we pay to OWN Program participants, as a variable lease expense for their share of rental revenue
generated by us from equipment enrolled under the OWN Program, are presented as OWN Program payouts within
cost of revenues.
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Equipment Sales
Equipment sales cost of revenues includes our OEC, less accumulated depreciation, related to equipment that
we sell when we act as the principal in the transaction.
Platform Expense
Platform expense primarily represents (1) costs relating to the telematics services provided to customers,
including the cost of tracker devices and cloud-based access control keypads installed on equipment owned by our
customers, and other custom electronic components; (2) the cost of building supplies, materials and hardware sold to
customers; and (3) other operating costs for our retail stores.
Depreciation and Amortization
Depreciation and amortization includes non-cash expenses relating to the depreciation of our rental equipment
in the fleet and the amortization of capitalized costs relating to the development of our T3 platform.
Depreciation of rental equipment includes depreciation of various classes of our construction equipment,
delivery vehicles, trailers, and installed telematics tracker devices. We estimate that we may hold the asset in its
rental fleet for a period of five to ten years to generate rental revenue, after which it will be sold or otherwise
disposed of to another party. We also estimate the residual value of the equipment at the time of expected disposal.
Depreciation expense is calculated using a straight-line method and recorded over the estimated holding period.
The total capitalized cost of our T3 platform includes direct costs that result in additional functionality of our
software, including payroll and related costs for employees directly associated with the development project.
Capitalized software is amortized over an estimated useful life of five years.
Selling, General and Administrative Expenses
Selling, general and administrative expenses primarily include costs associated with operating leases, costs
incurred by us in connection with marketing of manufacturers’ equipment, net of reimbursements we receive from
such manufacturers for such costs, payroll costs, insurance costs, legal costs, marketing and travel costs, technology
costs, and certification and training costs. In addition, depreciation of our buildings and improvements, including
leasehold improvements, furniture, fixtures, office equipment, and capitalized startup costs are classified within
selling, general and administrative expenses.
Other Income (Expense)
Gain on Sale of Properties and Other Assets
Gain on the sale of properties and other assets primarily relate to properties in sale leaseback transactions with
other parties.
Interest Expense
Interest expense primarily represents interest on our outstanding debt. Any interest or penalties incurred relating
to income tax filings, if any, are also reported within interest expense.
Other Income, Net
Other income, net includes gains and losses on investments in equity securities, realized gains on available-for-
sale debt securities, fees relating to properties assigned to other parties, construction development fees earned for
managing construction activities at properties owned by other parties, and other miscellaneous income.
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Results of Operations
Three Months Ended March 31, 2026 Compared with Three Months Ended March 31, 2025
Three Months Ended March 31, | |||||||
2026 | 2025 | $ Change | % Change | ||||
($ in millions) | |||||||
Revenues | |||||||
Equipment rental and related services ................ | $683 | $495 | $188 | 38% | |||
Equipment sales .................................................. | 179 | 145 | 34 | 23% | |||
Equipment parts and supplies and services ......... | 77 | 58 | 19 | 33% | |||
Platform revenue: | |||||||
Telematics ...................................................... | 31 | 10 | 21 | 210% | |||
Other ............................................................... | 19 | 8 | 11 | 138% | |||
Total revenue .................................................... | 989 | 716 | 273 | 38% | |||
Cost of revenues | |||||||
Direct operating costs .......................................... | 222 | 171 | 51 | 30% | |||
OWN Program payouts ....................................... | 217 | 154 | 63 | 41% | |||
Equipment sales .................................................. | 146 | 113 | 33 | 29% | |||
Platform expense ................................................. | 28 | 8 | 20 | 250% | |||
Depreciation and amortization ............................ | 89 | 70 | 19 | 27% | |||
Total cost of revenues ...................................... | 702 | 516 | 186 | 36% | |||
Gross profit ....................................................... | 287 | 200 | 87 | 44% | |||
Selling, general and administrative expenses ..... | 286 | 210 | 76 | 36% | |||
Operating income (loss) .................................... | 1 | (10) | 11 | (110)% | |||
Other income (expense): | |||||||
Interest expense ................................................... | (70) | (63) | (7) | 11% | |||
Other income, net ................................................ | 8 | 6 | 2 | 33% | |||
Total other expense, net ................................... | (62) | (57) | (5) | 9% | |||
Loss before income taxes .................................... | (61) | (67) | 6 | (9)% | |||
Benefit from income taxes .................................. | (32) | (19) | (13) | 68% | |||
Net loss ............................................................... | $(29) | $(48) | $19 | (40)% | |||
Total revenue. Our revenue was $989 million for the three months ended March 31, 2026, compared to $716
million for the three months ended March 31, 2025, an increase of $273 million, or 38%. Our four sources of
revenues over the period are further discussed below:
Equipment rental revenue and related services. Equipment rental revenue and related services accounted for
69% of our revenue for the three months ended March 31, 2026, compared to 69% of our revenue for the three
months ended March 31, 2025. Our equipment rental revenue and related services was $683 million for the three
months ended March 31, 2026, compared to $495 million for the three months ended March 31, 2025, an increase of
$188 million, or 38%. Approximately $144 million of the increase in equipment rental revenue and related services
is driven by an increase in construction demand in the U.S., our strategy to increase our geographical presence, and
value afforded our customers from our T3 technology platform. Accordingly, we increased the number of our full-
service equipment rental branch locations from 292 as of March 31, 2025 to 371 as of March 31, 2026. In addition,
we grew our fleet OEC under management from $7,013 million as of March 31, 2025 to $9,065 million as of
March 31, 2026, and increased the size of our fleet from 207,366 units to 262,650 units of equipment under
management as of March 31, 2025 and 2026, respectively. Changes in the mix of equipment rented and price
changes increased in equipment rental and related services revenue by $44 million.
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Equipment sales revenue. Equipment sales revenue accounted for 18% of our revenue for the three months
ended March 31, 2026, compared to 20% of our revenue for the three months ended March 31, 2025. Equipment
sales revenue was $179 million for the three months ended March 31, 2026, compared to $145 million for the three
months ended March 31, 2025, an increase of $34 million, or 23%. The change was primarily due to our disciplined
and selective equipment sales into the OWN Program, resulting in an increase of $7 million in sales of construction
equipment to existing and new participants in our OWN Program, and an increase of $27 million in the sale of new
and used equipment to contractors and other end users. As we increase the size of our OWN Program, transactions
with OWN Program participants may result in a higher percentage of our revenue being attributable to an OWN
Program participant for the period during which one or more equipment sale transactions with such party occurred.
We have experienced strong interest from participants in the OWN Program for construction equipment enabled by
T3, as owners get real-time data on usage, health, and performance of the machines rented exclusively by
EquipmentShare and re-rented to our customers. The OWN Program has allowed us to scale the fleet OEC under
our management in order to meet customer demand for construction equipment enabled by T3.
Equipment parts, supplies, and services. Equipment parts, supplies, and services revenue accounted for 8% of
our revenue for the three months ended March 31, 2026, compared to 8% for the three months ended March 31,
2025. Equipment parts, supplies, and services revenue was $77 million for the three months ended March 31, 2026,
compared to $58 million for the three months ended March 31, 2025, an increase of $19 million, or 33%. This
increase was primarily due to our expansion into new markets, resulting in additional full-service branch locations
added to our nationwide network, which increased from 292 locations as of March 31, 2025 to 371 locations as of
March 31, 2026. Equipment parts, supplies, and services revenue increased $4 million from mature branch locations
primarily attributed to the expansion of our product and service offering in mature branch locations, and $15 million
from new branch locations open less than 24 months as a result of the addition of 79 full-service branch locations.
Platform revenue. Platform revenue accounted for 5% of our revenue for the three months ended March 31,
2026, compared to 3% of our revenue for the three months ended March 31, 2025. Platform revenue from telematics
was $31 million for the three months ended March 31, 2026, compared to $10 million for the three months ended
March 31, 2025, an increase of $21 million, or 210%. This increase was primarily due to an increase in monthly
subscriptions sold for the T3 telematics services, an increase in equipment rented that is fully enabled with T3
telematics services, and an increase in revenues related to the sale of custom electronic components following our
September 2025 acquisition of the controlling interests in The Morey Corporation (“Morey”), a business that
designs, manufactures, and sells custom electronic components, including telematics tracker devices and cloud-
based access control keypads. Platform revenue from the sale of construction materials, building supplies, and
hardware across our building materials and hardware retail stores was $19 million for the three months ended
March 31, 2026, compared to $8 million for the three months ended March 31, 2025, an increase of $11 million
primarily attributable to the addition of 11 building materials and hardware retail stores.
Cost of revenues. Cost of revenues was $702 million for the three months ended March 31, 2026, compared to
$516 million for the three months ended March 31, 2025, an increase of $186 million, or 36%.
Direct operating costs. Direct operating costs were $222 million for the three months ended March 31, 2026,
compared to $171 million for the three months ended March 31, 2025, an increase of $51 million, or 30%. The
increase in direct operating costs is primarily due to the organic expansion of our footprint through the addition of
79 full-service branch locations, which increased from 292 locations as of March 31, 2025 to 371 locations as of
March 31, 2026, partially offset by a decrease in equipment operating lease expense of $1 million due to the
termination of certain equipment operating lease agreements. The additional operating locations drove increases in
wages and related benefits of $23 million, and logistics, maintenance, and other site operating costs of $29 million.
OWN Program payouts. OWN Program payouts were $217 million for the three months ended March 31, 2026
compared to $154 million for the three months ended March 31, 2025, an increase of $63 million, or 41%.
Approximately $63 million of the increase is attributed to the growth of the average fleet OEC under management
enrolled in the OWN Program, which grew from $3,529 million in 2025 to $4,980 million in 2026, or 41%, driven
by demand from customers and participants in the OWN Program for construction equipment, as well as an increase
in 19 new full-service branch locations during the three months ended March 31, 2026.
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Equipment sales cost of revenues. Equipment sales cost of revenues was $146 million for the three months
ended March 31, 2026, compared to $113 million for the three months ended March 31, 2025, an increase of $33
million, or 29%. This increase was primarily due to higher equipment sales to existing and new participants in the
OWN Program resulting in a increase in equipment sales cost of revenues of $10 million, and an increase of $23
million in equipment sales to contractors and other end users primarily due to our ability to reach a greater customer
base through our expansion of full-service branch locations, which increased from 292 as of March 31, 2025 to 371
as of March 31, 2026, also contributed to the increase in equipment sales cost of revenues.
Platform expense. Platform expense was $28 million for the three months ended March 31, 2026, compared to
$8 million for the three months ended March 31, 2025, an increase of $20 million primarily attributed to the addition
of 11 hardware retail stores and the acquisition of Morey in September 2025.
Depreciation and amortization. Depreciation and amortization accounted for 13% of our cost of revenues for
the three months ended March 31, 2026, compared to 14% of our cost of revenues for the three months ended
March 31, 2025. Depreciation and amortization was $89 million for the three months ended March 31, 2026,
compared to $70 million for the three months ended March 31, 2025, an increase of $19 million, or 27%. This
increase was primarily due to an increase in depreciable equipment expense on rental equipment due to an increase
in average cost of owned equipment in our rental equipment, and a $3 million increase in amortization expense on
capitalized software due to an increase in average capitalized costs related to the continued development of our T3
platform.
Selling, general and administrative expenses. Selling, general and administrative expenses were $286 million
for the three months ended March 31, 2026, compared to $210 million for the three months ended March 31, 2025,
an increase of $76 million, or 36%. The increases in selling, general and administrative expenses were primarily
attributed to our expansion of full-service branch locations and growth strategy. To support our expansion, we hired
570 additional staff resulting in an increase of $28 million in selling, general and administrative expense associated
with higher payroll, benefits and travel costs. Our expansion of full-service locations also resulted in higher facilities
and non-rental vehicles lease expense and associated costs of $11 million. The growth of our business and expansion
of our full-service branch locations also increased administrative costs such as insurance, legal, professional
expenses and non-income based taxes by $7 million and other miscellaneous administrative expenses by $13
million. Additionally, stock-based compensation expense of $17 million was recorded for the IPO Founders Awards
for the three months ended March 31, 2026.
Interest expense, net. Interest expense, net, was $70 million for the three months ended March 31, 2026,
compared to $63 million for the three months ended March 31, 2025, an increase of $7 million, or 11%. This
increase was primarily due to an increase in average outstanding debt balances to fund our expansion strategy
including purchases of construction equipment for our fleet, partially offset by lower average interest rates under our
asset-based revolving credit facilities.
Total other expense, net. Total other expense, net, was $62 million for the three months ended March 31, 2026,
compared to $57 million for the three months ended March 31, 2025, an increase of $5 million, or 9%. This increase
was primarily due to higher interest expense of $7 million for the three months ended March 31, 2026, compared to
the three months ended March 31, 2025, resulting from our higher average outstanding borrowing for the three
months ended March 31, 2026, partially offset by higher miscellaneous income of $2 million due to interest and
dividend income and unrealized net gains, on various investments held in equity securities.
Benefit from income taxes. The benefit for income taxes was $32 million for the three months ended March 31,
2026, compared to $19 million for the three months ended March 31, 2025, an increase of $13 million, or 68%.
Although the Company incurred a loss in the current interim period, it anticipates generating taxable income for the
full fiscal year. Accordingly, the estimated annual effective tax rate reflects the expected full-year income and
related expense. Differences between applicable federal and state statutory tax rates and the effective income tax
rates for the income tax benefit recorded by the Company are primarily due to nondeductible expenses and the Texas
franchise tax, offset by research and development tax credits.
Net loss. Net loss decreased by $19 million to $29 million for the three months ended March 31, 2026, as
compared to net loss of $48 million for the three months ended March 31, 2025, due to $11 million of higher
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operating income, partially offset by $5 million of higher total other expense, net and $13 million of higher income
tax benefit.
Key Performance Metrics
We regularly review a number of financial measurements and operating metrics to evaluate our operating
performance, measure our growth and make strategic investment decisions. In addition to traditional U.S. generally
accepted accounting principles (“U.S. GAAP”) performance measures, such as total revenue and net income, we use
supplemental performance operating metrics such as OEC Under Management, and the non-GAAP financial
measure EBITDA.
Non-GAAP Financial Measure
We refer in this Form 10-Q to EBITDA, a non-GAAP financial measure that is not prepared in accordance with
U.S. GAAP. This non-GAAP financial measure should be considered supplemental to and is not a substitute for
financial information prepared in accordance with U.S. GAAP. Our use of the term EBITDA may vary from the use
of similar terms by other companies in our industry and accordingly may not be comparable to similarly titled
measures used by other companies.
EBITDA. EBITDA is a key metric used by management and our Board to assess our financial performance. We
define EBITDA as net income before interest expense, income taxes, depreciation and amortization and non-cash
stock compensation expense, which we believe, when excluded, provide investors with a useful representation of our
ongoing operations and performance. Certain items excluded from EBITDA are significant components in
understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax
structure, as well as the historic costs of depreciable assets, none of which are reflected in EBITDA. Our
presentation of EBITDA should not be construed as an indication that results will be unaffected by the items
excluded from EBITDA.
The table below reconciles net income to EBITDA for each of the periods indicated:
Three Months Ended March 31, | |||
2026 | 2025 | ||
(in millions) | |||
Net income ...................................................................................... | $(29) | $(48) | |
Provision for income taxes ............................................................. | (32) | (19) | |
Depreciation and amortization expense .......................................... | 104 | 79 | |
Interest expense .............................................................................. | 70 | 63 | |
Non-cash stock compensation expense(1) ....................................... | 19 | 1 | |
EBITDA ........................................................................................ | $132 | $76 | |
__________________
(1)Represents non-cash compensation expense for stock option and other stock-based awards.
Other Key Financial Metrics
Equipment Rental Segment Adjusted EBITDA and Equipment Rental Segment Adjusted EBITDA Margin.
Equipment Rental Segment Adjusted EBITDA and Equipment Rental Segment Adjusted EBITDA Margin are key
performance metrics used by management and our Board to assess the financial performance of our Equipment
Rental and Services Operations segment. Equipment Rental Segment Adjusted EBITDA is the profitability measure
used by management to evaluate our Equipment Rental and Services Operations segment, disclosed in accordance
with the requirements of Accounting Standards Codification (“ASC”) Topic 280, Segment Reporting, (“Topic 280”).
Equipment Rental Segment Adjusted EBITDA Margin is Equipment Rental Segment Adjusted EBITDA divided by
Equipment Rental and Services Operations Segment total revenues.
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The below table presents our Equipment Rental Segment Adjusted EBITDA and Equipment Rental Segment
Adjusted EBITDA Margin for each of the periods indicated.
Three Months Ended March 31, | |||
2026 | 2025 | ||
(in millions) | |||
Equipment Rental Segment Adjusted EBITDA(1) ................................. | $323 | $209 | |
Equipment Rental Segment Adjusted EBITDA Margin ....................... | 42% | 38% | |
__________________
(1)Equipment Rental Segment Adjusted EBITDA includes direct operating costs (excluding equipment and vehicle operating lease expense)
and selling, general, and administrative expenses (excluding depreciation expense related to our property and other fixed assets). Equipment
and vehicle operating lease expense was $6 million and $6 million for the three months ended March 31, 2026 and 2025, respectively.
Depreciation expense related to our property and other fixed assets was $14 million and $9 million, and for the three months ended
March 31, 2026 and 2025, respectively. Equipment Rental Segment Adjusted EBITDA also excludes operating expenses related to OWN
Program payouts, depreciation expense on rental equipment, and amortization expense on capitalized software and intangible assets. These
excluded expenses are significant: OWN Program payouts, depreciation expense on rental equipment, and amortization expense on
capitalized software and intangible assets was $217 million, $82 million, and $8 million, respectively, for the three months ended March 31,
2026, $154 million, $67 million, and $4 million, respectively, for the three months ended March 31, 2025. For additional information, see
Note 18 to our condensed consolidated financial statements for the three months ended March 31, 2026.
OEC Under Management. A substantial portion of our overall value is in our rental fleet equipment, including
support vehicles and trailers. The OEC of our owned rental equipment at March 31, 2026 and March 31, 2025 was
$3,930 million and $3,213 million, respectively, or approximately 43% and 46%, respectively, of total equipment
rental OEC under our management. At March 31, 2026, the appraised value of the rental equipment owned by OWN
Program participants was $4,039 million. Our broader managed equipment rental fleet from which we support and
generate our equipment rental revenue as of March 31, 2026 consisted of 262,650 units having an OEC of $9,065
million and an average age of 31 months, and as of March 31, 2025 consisted of 207,366 units having an OEC of
$7,013 million and an average age of 29 months.
Fleet Composition. Our equipment rental fleet from which we support and generate our equipment rental
revenue is summarized in the tables below:
March 31, 2026 | |||||||
% of | OEC | % of | |||||
Units | Total | (in millions) | Total | ||||
EquipmentShare Owned ............................... | 179,322 | 69% | $3,930 | 43% | |||
OWN Program .............................................. | 82,480 | 31% | 5,056 | 56% | |||
Operating Lease ............................................ | 848 | —% | 79 | 1% | |||
Total ............................................................ | 262,650 | 100% | $9,065 | 100% | |||
March 31, 2025 | |||||||
% of | OEC | % of | |||||
Units | Total | (in millions) | Total | ||||
EquipmentShare Owned ............................... | 142,936 | 69% | $3,213 | 46% | |||
OWN Program .............................................. | 62,581 | 30% | 3,642 | 52% | |||
Operating Lease ............................................ | 1,849 | 1% | 158 | 2% | |||
Total ............................................................ | 207,366 | 100% | $7,013 | 100% | |||
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December 31, 2025 | |||||||
% of | OEC | % of | |||||
Units | Total | (in millions) | Total | ||||
EquipmentShare Owned ............................... | 170,704 | 68% | $3,740 | 43% | |||
OWN Program .............................................. | 80,482 | 32% | 4,942 | 56% | |||
Operating Lease ............................................ | 1,066 | —% | 98 | 1% | |||
Total ............................................................. | 252,252 | 100% | $8,780 | 100% | |||
December 31, 2024 | |||||||
% of | OEC | % of | |||||
Units | Total | (in millions) | Total | ||||
EquipmentShare Owned ............................... | 134,394 | 69% | $3,021 | 46% | |||
OWN Program .............................................. | 58,360 | 30% | 3,437 | 52% | |||
Operating Lease ............................................ | 1,708 | 1% | 143 | 2% | |||
Total ............................................................. | 194,462 | 100% | $6,601 | 100% | |||
The diversity of equipment in our rental fleet is monitored and carefully balanced to give us the ability to
relocate equipment across regions to support increased regional industrial or construction activity and enhance our
overall utilization. For example, certain categories of our equipment supporting industrial construction can
efficiently be re-located to infrastructure projects. As of March 31, 2026 and December 31, 2025, 84% and 85% of
our rental fleet consists of general rental construction equipment, which includes our core rental equipment of boom
lifts, telehandlers, earth moving, scissor lifts, and excavators, respectively, and 16% and 15% of our rental fleet
consists of specialty equipment, which includes advanced solutions, industrial tooling, and other non-core rental
equipment, respectively.
The rental equipment mix among our general rental and specialty equipment categories was largely consistent in
each year as a percentage of total units available for rent and as a percentage of OEC.
For the net book value of our rental equipment, see Note 5 to our unaudited condensed consolidated financial
statements for the three months ended March 31, 2026.
Business Segments
We operate our business through the following reportable segments: (i) Equipment Rental and Services
Operations, comprised of recurring activity performed at our full-service branch locations, such as equipment rentals
and related services (including allocated telematics revenue related to rental customer access to the T3 platform),
and sales of parts, supplies and maintenance services to construction contractors and others, and (ii) Equipment
Sales, comprised of sales by us of new or used equipment made at any of our branch locations and dealership sites,
including equipment sales to participants in the OWN Program. All other business activities include telematics SaaS
subscriptions, software applications, and related telematics devices purchased by customers for their owned fleet, as
well as building materials and hardware supplies. These segments are based upon how we allocate resources and
assess performance. For additional information about our business segments, see Note 18 to our unaudited
condensed consolidated financial statements for the three months ended March 31, 2026.
Equipment Rental and Services Operations
Our core service is the rental of equipment to customers on a daily, weekly, and monthly basis, enabled by our
T3 platform. The equipment we rent includes (i) company-owned equipment, (ii) equipment that is leased to us
under month-to-month or longer-term arrangements from participants in our OWN Program, and (iii) equipment
owned by other third parties and leased to us under operating leases. We generate rental revenue by renting
equipment owned by us or owned by others and re-renting the equipment to our customers.
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In addition to equipment rental revenue, we also generate revenue from the sale of RPP services designed to
protect our customers from potential damage or loss to the equipment during the rental period, environmental fees
assessed on the rental asset, and fuel recovery fees that we charge to our rental customers.
As an integral part of our Equipment Rental and Services Operations segment, we sell equipment parts and
supplies and provide maintenance and repair services to customers, as well as the owners of equipment who are
participants in our OWN Program. We generate revenue from the provision of ad hoc and preventative maintenance
and repair services to our customers. We also provide warranty repair services on behalf of OEMs in order to fulfill
the warranty extended by the OEMs to customers. Revenue that we generate from warranty repair services
represents compensation for the service performed by us.
Our principal costs and expenses associated with the Equipment Rental and Services Operations segment
include (i) segment direct operating costs incurred across our 371 full-service branch locations and 9 dealership sites
as of March 31, 2026, excluding operating expenses related to OWN Program payouts and equipment and vehicle
operating lease expense; and (ii) segment selling, general and administrative expenses, excluding depreciation
expense related to the property and other fixed assets. Direct operating costs include the costs incurred at our rental
branch locations that collectively support our Equipment Rental and Services Operations segment, including, but not
limited to, wages and related benefits, service costs in connection with our rental equipment, site operating costs,
pickup and delivery expenses in connection with rental equipment, maintenance, fuel, parts, and supplies.
Equipment Sales
Through our Equipment Sales segment, we manage retail processes to sell new and used equipment. We sell
used equipment assets to participants in our OWN Program, including third parties who have financed equipment
purchases through the issuance of ABS. We also sell new and used equipment to others through a variety of
channels, including retail sales, wholesalers, brokered sales, and auctions. Our principal costs and expenses
associated with the Equipment Sales segment include the OEC, or purchase cost, of the equipment that we sell when
we act as the principal in the transaction. When we act as the agent in the transaction, the purchase cost of the
equipment that we sell is presented net of the equipment sales revenue.
All Other
All other business activities, which include telematics SaaS subscriptions, software applications, and the design,
manufacture, and sale of custom electronic components, including telematics devices and cloud-based access control
keypads purchased by customers for their owned fleet, as well as building materials and hardware supplies, are
included in “All Other.”
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The following tables present information about our reportable segments for the three months ended March 31,
2026 and 2025 (in millions):
Three Months Ended March 31, 2026 | |||||||
Equipment Rental and Services Operations | Equipment Sales | All Other | Total | ||||
Equipment rental, parts, supplies, and services ........... | $760 | $— | $— | $760 | |||
Equipment sales ........................................................... | — | 179 | — | 179 | |||
Telematics ................................................................... | 4 | — | 27 | 31 | |||
Sales of building materials, small tools, and hardware supplies .................................................... | — | — | 19 | 19 | |||
Total revenues ........................................................... | $764 | $179 | $46 | $989 | |||
Significant expenses: | |||||||
Segment cost of revenues ....................................... | 216 | 146 | 28 | ||||
Segment selling, general and administrative expenses .............................................................. | 225 | 7 | 20 | ||||
Segment Adjusted EBITDA(1) ................................. | $323 | $26 | $(2) | ||||
Three Months Ended March 31, 2025 | |||||||
Equipment Rental and Services Operations | Equipment Sales | All Other | Total | ||||
Equipment rental, parts, supplies, and services ........... | $553 | $— | $— | $553 | |||
Equipment sales ........................................................... | — | 145 | — | 145 | |||
Telematics ................................................................... | 3 | — | 7 | 10 | |||
Sales of building materials, small tools, and hardware supplies .................................................... | — | — | 8 | 8 | |||
Total revenues ............................................................ | $556 | $145 | $15 | $716 | |||
Significant expenses: ................................................... | |||||||
Segment cost of revenues ....................................... | 165 | 113 | 8 | ||||
Segment selling, general and administrative expenses .............................................................. | 182 | 7 | 11 | ||||
Segment Adjusted EBITDA(1) .................................. | $209 | $25 | $(4) | ||||
__________________
(1)Segment Adjusted EBITDA includes cost of revenues and selling, general, and administrative expenses for each segment. Cost of revenues
for the Equipment Rental and Services Operations segment includes direct operating costs, excluding equipment and vehicle operating lease
expense. Equipment and vehicle operating lease expense was $6 million and $6 million for the three months ended March 31, 2026 and
2025 respectively. Cost of revenues for the Equipment Sales segment includes the cost of equipment sales. Cost of revenues for all other
activities includes platform expenses. Segment Adjusted EBITDA also excludes operating expenses related to OWN Program payouts,
depreciation expense on rental equipment, and amortization expense on capitalized software and intangible assets. These excluded expenses
are significant: OWN Program payouts, depreciation expense on rental equipment, and amortization expense on capitalized software and
intangible assets was $217 million, $82 million, and $8 million, respectively, for the three months ended March 31, 2026, $154 million, $67
million, and $4 million, respectively, for the three months ended March 31, 2025. Selling, general and administrative expenses for each
segment exclude depreciation expense related to our property and other fixed assets. Depreciation expense related to our property and other
fixed assets was $14 million and $9 million for the three months ended March 31, 2026 and 2025, respectively. For additional information,
see Note 18 to our condensed consolidated financial statements for the three months ended March 31, 2026.
Three Months Ended March 31, 2026 Compared with Three Months Ended March 31, 2025
Equipment Rental and Services Operations. Revenue for our Equipment Rental and Services Operations
segment was $764 million for the three months ended March 31, 2026, compared to $556 million for the three
months ended March 31, 2025, an increase of $208 million, or 37%. Approximately $144 million of the increase is
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attributed to the growth in fleet OEC under our management from $7,013 million as of March 31, 2025 to $9,065
million as of March 31, 2026, and the corresponding increase in our fleet size from 207,366 units to 262,650 units of
equipment under our management as of March 31, 2025 and 2026, respectively. The increase in fleet OEC under our
management, connected to our T3 platform, drove an increase in equipment rental revenue, primarily from national
and regional customers. Fleet OEC under our management includes equipment we own and lease, as well as
equipment owned by third parties and leased through our OWN Program that we rent to customers from our full-
service branch locations, which also increased from 292 as of March 31, 2025, to 371 as of March 31, 2026.
Revenue from sales of equipment parts, supplies, and services from mature branch locations and new branch
locations open less than 24 months contributed $4 million and $15 million, respectively, to the increase in
equipment rental and related services revenue and changes in the mix of equipment rented and price changes
increased equipment rental and related services revenue by $44 million.
Segment Adjusted EBITDA for our Equipment Rental and Services Operations segment was $323 million for
the three months ended March 31, 2026, compared to $209 million for the three months ended March 31, 2025, an
increase of $114 million, or 55%. The increase in Segment Adjusted EBITDA was primarily due an increase in
segment total revenues of $208 million from equipment rentals and the sale of parts, supplies and services, attributed
to our organic growth initiatives, including the maturation of our existing sites and incremental growth sites, and an
increase in equipment rental fleet OEC under our management, from $7,013 million as of March 31, 2025 to $9,065
million as of March 31, 2026, and the corresponding increase in our fleet size from 207,366 units to 262,650 units of
equipment under our management as of March 31, 2025 and 2026, respectively, driven by OWN Program demand.
The increase in segment total revenues was offset by increases of $51 million in segment cost of revenues and $43
million in segment selling, general and administrative expenses.
Equipment Sales. Revenue for our Equipment Sales segment was $179 million for the three months ended
March 31, 2026, compared to $145 million for the three months ended March 31, 2025, an increase of $34 million,
or 23%. The increase was primarily due to increased sales of construction equipment, primarily to contractors and
other end users, as presented in the following table (in millions):
Three Months Ended March 31, | |||||||
2026 | 2025 | $ Change | % Change | ||||
Equipment sales to OWN Program participants(1) ....... | $102 | $95 | $7 | 7% | |||
Other equipment sales ................................................. | 77 | 50 | 27 | 54% | |||
Total revenues - equipment sales ................................ | $179 | $145 | $34 | 23% | |||
Cost of equipment sold to OWN Program participants ............................................................... | $82 | $72 | $10 | 14% | |||
Cost of other equipment sales ..................................... | 64 | 41 | 23 | 56% | |||
Total cost of revenues - equipment sales ..................... | $146 | $113 | $33 | 29% | |||
__________________
(1)For the three months ended March 31, 2026 and 2025, equipment sales to OWN Program participants included net revenue of $6 million
and $13 million, respectively, recognized on an agent basis, with overall transaction values of $41 million and $97 million, respectively.
The increase in equipment sales of $34 million is primarily attributed to higher sales of $7 million in
construction equipment to existing and new participants in our OWN Program. Sales of new and used equipment
from our full service branch locations to contractors and other end users increased $27 million, primarily attributed
to our site expansions.
Segment Adjusted EBITDA for our Equipment Sales segment was $26 million for the three months ended
March 31, 2026, compared to $25 million for the three months ended March 31, 2025, an increase of $1 million, or
4%. The increase in Segment Adjusted EBITDA was primarily attributed to higher gross margins on equipment
sales.
All Other. Revenue for all other activities was $46 million for the three months ended March 31, 2026,
compared to $15 million for the three months ended March 31, 2025, an increase of $31 million, or 207%. This
increase was primarily due to an increase of $20 million in telematics SaaS subscriptions, applications, and related
telematics devices, as well as an increase of $11 million in sales of building materials, small tools, and hardware
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supplies due to our expansion of 11 hardware stores during the trailing twelve months. Segment loss for our all other
activities was $2 million for the three months ended March 31, 2026, compared to $4 million for the three months
ended March 31, 2025, an increase of $2 million, or 50%, primarily due to the higher revenue as previously
discussed, partially offset by an increase of $9 million in selling, general and administrative expenses, including
employee compensation, technology costs, professional service fees, and insurance expenses which were allocated
to all other activities based on employee headcount.
Liquidity and Capital Resources
Overview
Our primary liquidity needs include funding our growth, payment of operating expenses, purchases of rental
equipment to be used in our operations, servicing of debt, and funding acquisitions.
Our future contractual obligations are further discussed in “—Contractual Obligations and Commitments”
below. Our primary sources of liquidity have been cash and cash equivalents, cash flows from our operations and
our ability to borrow under our existing ABL Credit Facility, other financing arrangements, including lines of credit,
and the issuances of perpetual preferred, common stock, and convertible preferred stock.
As of March 31, 2026, our liquidity consisted of cash and cash equivalents of $329 million and net excess
availability of $1,276 million under our ABL Credit Facility. See “—ABL Credit Facility—Borrowing Capacity”
below.
Our strategy is to maintain enough liquidity from both cash from operations and our availability under our debt
facilities to maintain sufficient headroom to finance our growth, as well as mitigate the impact that any adverse
financial market conditions might have on our operations in the future. We believe that cash generated from
operations, together with amounts available under the ABL Credit Facility or other financing arrangements, will be
sufficient to meet working capital requirements, debt payments, and anticipated capital expenditures, as well as meet
other strategic uses of cash, if any, over the next twelve months and beyond. We aim to maintain at least
$500 million in liquidity at all times.
To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business
activities and requirements, we may be required to seek additional equity or debt financing. The sale of additional
equity would result in additional dilution to shareholders. In addition, we continuously monitor the capital markets
and our capital structure, and, from time to time, we seek to refinance, amend or otherwise restructure our
outstanding debt on an opportunistic basis and can also choose to raise incremental liquidity as part of such
transactions. Such repurchases, refinancings, amendments, exchanges or other transactions, if any, will be upon such
terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity
requirements, the availability of authorized share capital, contractual restrictions and other factors. The incurrence of
debt financing would result in debt service obligations and the instruments governing such debt could provide for
operating and financing covenants that may restrict our operations. There can be no assurances that we will be able
to raise additional capital on terms that are attractive to us or at all. The inability to raise capital would adversely
affect our ability to achieve our business objectives.
We sell equipment to third party OWN Program participants who have financed equipment purchases through
the issuance of ABS. Under the terms of the ABS, if the appraised value of the equipment declines below specified
amounts, these vehicles may require the third-party owner to liquidate some or all of their equipment, which would
make it unavailable to us and may require us to expend cash to obtain replacement equipment in order to supply our
customers with rental equipment.
Cash Flows
Significant factors driving our liquidity position include cash flows generated from operating and financing
activities, as well as investing activities. We have generated and expect to continue to generate positive cash flow
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from our operations. Our ability to fund our capital needs will be affected by our ongoing ability to generate cash
from operations and access to capital markets.
The following table summarizes the change in cash and cash equivalents for the periods shown:
Three Months Ended March 31, | |||
2026 | 2025 | ||
(in millions) | |||
Net cash used in operating activities .............................................. | $(200) | $(51) | |
Net cash used in investing activities ............................................... | (280) | (283) | |
Net cash provided by financing activities ...................................... | 503 | 273 | |
Net increase (decrease) in cash and cash equivalents .............. | $23 | $(61) | |
Net Cash Used in Operating Activities
For the three months ended March 31, 2026 and 2025, net cash used in our operating activities was $200 million
and $51 million, respectively, and was in each period primarily due to the expansion of our business, increased
working capital corresponding to the growth in our revenues, and the timing of certain payments. For the three
months ended March 31, 2026, net cash used in operating activities reflects a decrease in accrued equipment
purchases from $281 million at December 31, 2025 to $70 million at March 31, 2026, primarily due to the timing of
payments for equipment purchased in transactions when we act as the agent. Net cash used in operating activities
also reflects an increase in cost of revenues of $186 million, selling, general and administrative expenses of $76
million, and interest expense of $7 million for the three months ended March 31, 2026, as compared to the three
months ended March 31, 2025, associated with the growth of our revenues and other changes in working capital.
Net Cash Used in Investing Activities
For the three months ended March 31, 2026 and 2025, net cash used in our investing activities was $280 million
and $283 million, respectively, a decrease of 1%, and was primarily due to a decrease in cash used for the purchases
of properties and other fixed assets which was $48 million for the three months ended March 31, 2026, and $50
million for the three months ended March 31, 2025, and an increase in proceeds received from the sale of rental
equipment of $115 million and $75 million for the three months ended March 31, 2026 and 2025, partially offset by
an increase in by cash used for the purchases of rental equipment, which was $328 million for the three months
ended March 31, 2026, and $293 million for the three months ended March 31, 2025.
Net Cash Provided by Financing Activities
For the three months ended March 31, 2026, net cash provided by financing activities was $503 million,
compared to $273 million for the three months ended March 31, 2025, an increase of 84%. Net cash provided by
financing activities was positively impacted by net proceeds of $706 million from the issuance of class A common
stock upon the initial public offering, net of underwriting discount and commissions, net proceeds of $381 million
from the issuance of long-term debt for the three months ended March 31, 2026, and net proceeds of $300 million
from the issuance of long-term debt for the three months ended March 31, 2025. This was offset partially by using
$582 million in cash to repay long-term debt and finance leases for the three months ended March 31, 2026 and $15
million in cash to repay long-term debt and finance leases for the three months ended March 31, 2025.
Capital Expenditures
Our capital expenditures relate largely to purchases of rental equipment, with the remaining portion representing
purchases of and deposits on property and other fixed assets and investments in internally developed software
primarily associated with the development of our proprietary T3 platform and related software applications. We
offset capital expenditures related to our rental equipment fleet through our sales of rental equipment to contractors
and to OWN Program participants, including high net worth individuals, family offices, and other third parties who
have financed equipment purchases through the issuance of ABS.
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The table below sets forth the capital expenditures related to our rental equipment fleet, net of proceeds from the
sale of rental equipment, and investments we are making to the T3 platform and other internally developed software
for each of the years presented.
Three Months Ended March 31, | |||
2026 | 2025 | ||
(in millions) | |||
Purchases of rental equipment ........................................................... | $328 | $293 | |
Proceeds from sale of rental equipment ............................................. | (115) | (75) | |
Net rental equipment capital expenditure .................................... | $213 | $218 | |
Investments in internally developed software(1) ................................. | 9 | 10 | |
Net rental equipment & software expenditure ............................. | $222 | $228 | |
__________________
(1)Represents expenditures in connection with developing and maintaining our information technology, including our T3 platform, as well as
related software applications that generate platform revenue.
Net rental equipment capital expenditures were $213 million for the three months ended March 31, 2026,
compared to $218 million for the three months ended March 31, 2025, a decrease of 2%, as we continued to grow
our fleet and site locations in connection with our geographical expansion.
ABL Credit Facility
Borrowing Capacity
On November 26, 2025, the Company refinanced existing borrowings under an asset-based lending facility (the
“ABL Facility”) by entering into a new asset-based lending facility (the “ABL Credit Facility”). The ABL Credit
Facility has a stated maturity date of November 26, 2030. The ABL Credit Facility provides available “borrowing
capacity” (the maximum borrowing permitted, assuming there is sufficient collateral as identified under the ABL
Credit Facility) up to $2.75 billion. Borrowings under the ABL Credit Facility will bear interest at a rate (at the
Company’s election) equal to either (i) the SOFR plus a spread between 112.5 to 137.5 basis points or (ii) the
greatest of (a) 0%, (b) the Federal Funds Rate in effect on such day plus 50 basis points, (c) the SOFR for a one
month tenor in effect on such day (to the extent ascertainable), plus 100 basis points, and (d) the Prime Rate plus (y)
a spread between 12.5 basis points and 37.5 basis points.
The ABL Credit Facility provides for the majority of our borrowing capacity and availability. Creditors under
the ABL Credit Facility have a first-priority security interest in specific pools of assets identified as collateral
therein. Our ability to borrow under the ABL Credit Facility is a function of, among other things, the value of the
assets in the relevant collateral pool. We refer to the amount of debt we can borrow given a certain pool of assets as
the “Borrowing Base,” which includes our accounts receivable, unbilled accounts receivable, eligible rental
equipment, eligible rolling stock and eligible inventory.
Under the ABL Credit Facility, we are required to maintain control agreements on deposit accounts where,
(x) proceeds of collateral from customers and other obligors or (y) proceeds of sales of the collateral, are deposited.
During a Cash Dominion Period (as defined below), all amounts in such deposit accounts are swept into a collection
account maintained with the ABL Credit Facility Agent and used to repay borrowings under the ABL Credit
Facility. A cash dominion period (“Cash Dominion Period”) begins from the occurrence of (a) any specified event of
default or (b) specified availability being less than the greater of (i) 10% of the maximum borrowing amount and
(ii) $175 million, for five consecutive business days and ends when (a) no specified event of default exists and (b)
specified availability has been greater than the greater of (i) 10% of the maximum borrowing amount and (ii) $175
million, for twenty consecutive days.
As of March 31, 2026, we calculated a Borrowing Base, as defined under the ABL Credit Facility, of $2,280
million. We determine “Net Excess Availability” as the amount of additional debt we could borrow based on the
existing borrowing base. As of March 31, 2026, we had Net Excess Availability of $1,276 million under the ABL
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Facility. We determine “Remaining Capacity” as defined under the ABL Credit Facility as the maximum principal
amount of debt permitted to be outstanding under the facility (i.e., the amount of debt we could borrow assuming we
possessed sufficient assets as collateral) less the principal amount of debt then-outstanding under the facility. We
calculate “Availability Under Borrowing Base Limitation” as the lower of Remaining Capacity or the Borrowing
Base less the principal amount of debt then-outstanding under the ABL Credit Facility, or the amount of debt we
could borrow given the collateral we possess at such time, up to payment conditions. As of March 31, 2026, we
calculated Remaining Capacity of $1,746 million and our “Availability Under Borrowing Base Limitation” was
$1,048 million. Under the ABL Credit Facility, “Remaining Capacity” and “Availability Under Borrowing Base
Limitation” are calculated and defined in the same way as under the ABL Facility.
As of March 31, 2026, $6 million of standby letters of credit were issued and outstanding with a third-party
financial institution.
Covenants
Our ABL Credit Facility contains a number of covenants that, among other things, limit or restrict our ability to
dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay certain indebtedness, make
certain restricted payments (including paying dividends, redeeming stock or making other distributions), create liens,
make investments, make acquisitions, engage in mergers, fundamentally change the nature of our business, or
engage in certain transactions with certain affiliates. Under the terms of our ABL Credit Facility, we are not subject
to ongoing financial maintenance covenants; however, under the ABL Credit Facility, failure to maintain certain
levels of liquidity will subject us to a contractually specified fixed charge coverage ratio of not less than 1:1 for the
four quarters most recently ended. As of March 31, 2026, the appropriate levels of liquidity have been maintained;
therefore this financial maintenance covenant is not applicable. Additional information on the terms of our ABL
Credit Facility is included in Note 9 to our unaudited condensed consolidated financial statements included in this
Form 10-Q.
The ABL Credit Facility is secured on a first-priority basis by liens on substantially all of our and any
guarantor’s assets, subject to permitted liens and certain exceptions. As of the date of this Form 10-Q, the ABL
Credit Facility is not guaranteed by any of our subsidiaries.
Certain of the restrictive covenants under the ABL Credit Facility utilize adjusted EBITDA, as defined in the
related credit agreement, as a primary component of the compliance metric governing our ability to undertake
certain actions otherwise proscribed by such covenants. The adjusted EBITDA metric is calculated under the ABL
Credit Facility as net income before the income tax provision, net financing charges, restructuring and impairment
costs, allocation for support functions and other costs, and intangible asset amortization and depreciation, and new
market start-up costs attributable to new locations less than twelve months old subject to a specified cap calculated
as a percentage of the adjusted EBITDA metric. For the three months ended March 31, 2026 and 2025, new market
start-up costs attributed to our Equipment Rental and Services Operations segment were $50 million and $55
million, respectively.
Notes
Senior Secured Second Lien Notes due 2028
On May 9, 2023, we issued $640,000,000 in aggregate principal amount of 9.000% Senior Secured Second Lien
Notes due 2028 (the “Initial 2028 Notes”). On September 21, 2023, we issued an additional $400,000,000 in
aggregate principal amount of 9.000% Senior Secured Second Lien Notes due 2028 (the “Additional 2028 Notes”
and together with the Initial 2028 Notes, the “2028 Notes”). The 2028 Notes were issued pursuant to the indenture,
dated as of May 9, 2023, between us and Citibank, N.A., as trustee and notes collateral agent (the “2028 Notes
Indenture”). The 2028 Notes bear interest at a rate of 9.00% per year and interest on the 2028 Notes is payable semi-
annually in arrears on May 15 and November 15 of each year. The 2028 Notes will mature on May 15, 2028. The
2028 Notes rank pari passu in right of payment to all of our and any guarantor’s existing and future senior
indebtedness, including indebtedness under the ABL Credit Facility, our 2032 Notes (as defined below) and our
2033 Notes (as defined below).
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The 2028 Notes and any related guarantees are secured on a second-priority basis by liens on substantially all of
our and any guarantor’s assets that secure any first-priority lien obligations (including the ABL Credit Facility),
subject to permitted liens and certain exceptions. There are certain situations where all or a portion of such collateral
may be automatically released.
The 2028 Notes are not currently guaranteed by any of our subsidiaries and, in the future, will be jointly and
severally guaranteed on a senior secured second lien basis by each of our current and future subsidiaries to the extent
such subsidiary guarantees our ABL Credit Facility, subject to certain limitations and exceptions. We may redeem
some or all of the 2028 Notes at the redemption prices set forth in the 2028 Notes Indenture.
The 2028 Notes Indenture contains certain covenants applicable to us and our restricted subsidiaries, including
limitations on: (1) liens; (2) indebtedness; (3) mergers, consolidations and acquisitions; (4) sales, transfers and other
dispositions of assets; (5) loans and other investments; (6) dividends and other distributions, stock repurchases and
redemptions and other restricted payments; (7) restrictions affecting subsidiaries; (8) transactions with affiliates; and
(9) designations of unrestricted subsidiaries. Each of these covenants is subject to a number of important exceptions
and qualifications. In addition, many of the restrictive covenants do not apply to us during any period when the 2028
Notes are rated investment grade by any two of Moody’s Investors Service, Inc. (“Moody’s”), Standard & Poor’s
Investors Ratings Services (“S&P”) and Fitch Ratings (“Fitch”) or, in certain circumstances, another rating agency
selected by us, provided at such time no default under the 2028 Notes Indenture has occurred and is continuing. In
the case of an event of default, the principal amount of the 2028 Notes plus accrued and unpaid interest would be
accelerated.
Senior Secured Second Lien Notes due 2032
On April 16, 2024, we issued $600,000,000 in aggregate principal amount of 8.625% Senior Secured Second
Lien Notes due 2032 (the “2032 Notes”). The 2032 Notes were issued pursuant to the indenture, dated as of
April 16, 2024, between us and Citibank, N.A., as trustee and notes collateral agent (the “2032 Notes Indenture”).
The 2032 Notes bear interest at a rate of 8.625% per year and interest on the 2032 Notes is payable semi-annually in
arrears on May 15 and November 15 of each year. The 2032 Notes will mature on May 15, 2032. The 2032 Notes
rank pari passu in right of payment to all of our and any guarantor’s existing and future senior indebtedness,
including indebtedness under the ABL Credit Facility, our 2028 Notes and our 2033 Notes.
The 2032 Notes and any related guarantees are secured on a second-priority basis by liens on substantially all of
our and any guarantor’s assets that secure any first-priority lien obligations (including the ABL Credit Facility),
subject to permitted liens and certain exceptions. There are certain situations where all or a portion of such collateral
may be automatically released.
As of the date of this Form 10-Q, the 2032 Notes are not guaranteed by any of our subsidiaries. Going forward,
the 2032 Notes will be jointly and severally guaranteed on a senior secured second lien basis by each of our current
and future subsidiaries to the extent such subsidiary guarantees our ABL Credit Facility, subject to certain
limitations and exceptions. We may redeem some or all of the 2032 Notes at the redemption prices set forth in the
2032 Notes Indenture.
The 2032 Notes Indenture contains certain covenants applicable to us and our restricted subsidiaries, including
limitations on: (1) liens; (2) indebtedness; (3) mergers, consolidations and acquisitions; (4) sales, transfers and other
dispositions of assets; (5) loans and other investments; (6) dividends and other distributions, stock repurchases and
redemptions and other restricted payments; (7) restrictions affecting subsidiaries; (8) transactions with affiliates; and
(9) designations of unrestricted subsidiaries. Each of these covenants is subject to a number of important exceptions
and qualifications. In addition, many of the restrictive covenants do not apply to us during any period when the 2032
Notes are rated investment grade by any two of Moody’s, S&P, and Fitch or, in certain circumstances, another rating
agency selected by us, provided at such time no default under the 2032 Notes Indenture has occurred and is
continuing. In the case of an event of default, the principal amount of the 2032 Notes plus accrued and unpaid
interest would be accelerated.
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Senior Secured Second Lien Notes due 2033
On September 13, 2024, we issued $500,000,000 in aggregate principal amount of 8.000% Senior Secured
Second Lien Notes due 2033 (the “2033 Notes”). The 2033 Notes were issued pursuant to the indenture, dated as of
September 13, 2024, between us and Citibank, N.A., as trustee and notes collateral agent (the “2033 Notes
Indenture”). The 2033 Notes bear interest at a rate of 8.000% per year and interest on the 2033 Notes is payable
semi-annually in arrears on March 15 and September 15 of each year. The 2033 Notes will mature on March 15,
2033. The 2033 Notes rank pari passu in right of payment to all of our and any guarantor’s existing and future
senior indebtedness, including indebtedness under the ABL Credit Facility, our 2028 Notes and our 2032 Notes.
The 2033 Notes and any related guarantees are secured on a second-priority basis by liens on substantially all of
our and any guarantor’s assets that secure any first-priority lien obligations (including the ABL Credit Facility),
subject to permitted liens and certain exceptions. There are certain situations where all or a portion of such collateral
may be automatically released.
As of the date of this Form 10-Q, the 2033 Notes are not guaranteed by any of our subsidiaries. Going forward,
the 2033 Notes will be jointly and severally guaranteed on a senior secured second lien basis by each of our current
and future subsidiaries to the extent such subsidiary guarantees our ABL Credit Facility, subject to certain
limitations and exceptions. We may redeem some or all of the 2033 Notes at the redemption prices set forth in the
2033 Notes Indenture.
The 2033 Notes Indenture contains certain covenants applicable to us and our restricted subsidiaries, including
limitations on: (1) liens; (2) indebtedness; (3) mergers, consolidations and acquisitions; (4) sales, transfers and other
dispositions of assets; (5) loans and other investments; (6) dividends and other distributions, stock repurchases and
redemptions and other restricted payments; (7) restrictions affecting subsidiaries; (8) transactions with affiliates; and
(9) designations of unrestricted subsidiaries. Each of these covenants is subject to a number of important exceptions
and qualifications. In addition, many of the restrictive covenants do not apply to us during any period when the 2033
Notes are rated investment grade by any two of Moody’s, S&P, and Fitch or, in certain circumstances, another rating
agency selected by us, provided at such time no default under the 2033 Notes Indenture has occurred and is
continuing. In the case of an event of default, the principal amount of the 2033 Notes plus accrued and unpaid
interest would be accelerated.
Certain of the restrictive covenants under the indentures governing our outstanding notes utilize consolidated
total assets as a primary component of the compliance metric governing our ability to undertake certain actions
otherwise proscribed by such covenants.
In addition, certain liens and restricted payments are permitted subject to leverage ratios which are calculated
based on an adjusted EBITDA metric. Such adjusted EBITDA metric is calculated under the indentures governing
our outstanding notes as net income before income tax provision, net financing charges, restructuring and
impairment costs, allocation for support functions and other costs, and intangible asset amortization and
depreciation, and new market start-up costs attributable to new locations less than twelve months old subject to a
specified cap calculated as a percentage of the adjusted EBITDA metric.
Amendments to the Indentures Governing the 2028 Notes and the 2032 Notes
On July 17, 2025, the indentures governing the 2028 Notes and the 2032 Notes were amended to conform
certain covenants and related definitions for these notes to the indenture governing the 2033 Notes. Among other
things, the amendments increased certain limits on debt incurrence to align with the 2033 Notes and aligned certain
aspects of the lien covenant to the same terms in the 2033 Notes Indenture. In connection with these amendments to
the indentures, we paid $5 million in fees and expenses.
Dividends
Dividends on our perpetual preferred accrue and accumulate daily in arrears on the then current accreted
liquidation preference of the outstanding perpetual preferred, whether or not declared, and, if not declared and paid,
will accrue at the applicable dividend rate and be compounded quarterly in arrears. Dividends on the perpetual
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preferred will be payable, at our election, in cash at any time when, as and if declared by our Board or any duly
authorized committee of our Board, but only out of assets legally available. As of March 31, 2026, the maximum
potential dividend accumulated in arrears on our perpetual preferred was approximately $136 million.
Contractual Obligations and Commitments
The following table summarizes our long-term contractual obligations and commitments as of March 31, 2026.
Payments Due by Period | |||||||||
Total | Less than 1 year | 1 - 3 years | 3 - 5 years | More than 5 years | |||||
(In millions) | |||||||||
Debt ............................................................... | $3,139 | $5 | $1,035 | $999 | $1,100 | ||||
Operating leases ............................................ | 1,093 | 95 | 245 | 222 | 531 | ||||
Finance leases ............................................... | 302 | 25 | 56 | 52 | 169 | ||||
Financing obligations (equipment) ............... | 25 | 7 | 6 | 12 | – | ||||
Total contractual obligations .................... | $4,559 | $132 | $1,342 | $1,285 | $1,800 | ||||
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have a material current effect or are reasonably likely to have a
material future effect on our results of operations, financial condition, capital expenditures, liquidity or capital
resources.
Critical Accounting Policies and Estimates
Our critical accounting policies and estimates are described in “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December
31, 2025. There have been no material changes to our critical accounting policies and estimates during the quarter
ended March 31, 2026.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
We are exposed to a variety of market risks, primarily related to the effects of changes in interest rates
(including credit spreads) 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. Derivative financial instruments are viewed as risk management tools and have not been used for
speculative or trading purposes. In addition, derivative financial instruments are entered into with a major financial
institution in order to manage our exposure to counterparty nonperformance on such instruments.
Interest Rate Risk
We have assessed our exposure to changes in interest rates by analyzing the sensitivity to our earnings assuming
various changes in market interest rates. Assuming a hypothetical increase of one percentage point in interest rates
on our ABL Facility as of March 31, 2026, our pre-tax earnings would decrease by an estimated $10 million over a
12-month period. We terminated certain interest rate swap agreements in connection with the entry into the ABL
Credit Facility.
Commodity Price Risk
The cost of logistics and transportation fluctuates in large part due to the price of oil and demand trends. Any
fluctuations in our transportation costs in excess of amounts we charge to customers, including the cost of delivery
and pick up of construction equipment, could harm our gross profits and margins. If we are unable to successfully
mitigate a significant portion of commodity price increases or fluctuations, our results of operations could be
harmed. A 10% increase in our transportation costs, if not recovered through higher charges to our customers, would
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have resulted in a change to cost of revenues of approximately $4 million and $3 million, and for the three months
ended March 31, 2026 and 2025, respectively.
Foreign Currency Risk
We employ a limited number of software engineers domiciled in the United Kingdom (the “UK”). As a result,
we have foreign currency risk exposure to exchange rate fluctuations, primarily with respect to payroll, employee
benefits, lease expense, and other costs incurred and paid in British Pounds. During the three months ended
March 31, 2026, the total costs incurred by our subsidiary in the UK was not material to our operating results. Based
on the size of our subsidiary in the UK, we do not believe that a 10% change in the British Pound exchange rate
would have a material impact on our earnings. We do not engage in purchasing forward exchange contracts for
speculative purposes.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) are
designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange
Act is recorded, processed, summarized and reported within the appropriate time periods, and that such information
is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial
Officer, as appropriate, to allow timely discussions regarding required disclosure.
In designing and evaluating our disclosure controls and procedures, management recognizes that any disclosure
controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect
the fact that there are resource constraints, and that management is required to apply its judgment in evaluating the
benefits of possible controls and procedures relative to their costs.
We, under the supervision of and with participation of our management, including our Chief Executive Officer
and Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures. Based on
that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the design and operation of
our disclosure controls and procedures were effective as of March 31, 2026.
Management’s Annual Report on Internal Control Over Financial Reporting
This Form 10-Q does not include a report of management’s assessment regarding internal control over financial
reporting or an attestation report of our independent registered public accounting firm due to a transition period
established by rules of the SEC for newly public companies.
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting during the fiscal quarter ended
March 31, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.
55
PART II
Item 1. Legal Proceedings
A description of legal proceedings can be found in Note 17 to our unaudited condensed consolidated financial
statements of this quarterly report on Form 10-Q is incorporated by reference in answer to this item.
Item 1A. Risk Factors
There have been no material changes to our risk factors from those previously disclosed under Part I, Item 1A,
“Risk Factors” in our 2025 Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 5. Other Information
During the quarter ended March 31, 2026, none of the Company’s directors or Section 16 officers adopted
defined in Item 408(a) of Regulation S-K.
56
Item 6. Exhibits
(1)Exhibits: The exhibits to this report are listed in the exhibit index below.
Incorporation by Reference | ||||||||
Exhibit No. | Exhibit Description | Form | File No. | Exhibit No. | Filing Date | Filed Herewith | ||
3.1 | Amended and Restated Certificate of Formation | 8-K | 001-43062 | 3.1 | January 26, 2026 | |||
3.2 | Amended and Restated Bylaws | 8-K | 001-43062 | 3.2 | January 26, 2026 | |||
10.1 | Amendment No. 1 to the Credit Agreement, dated as of April 15, 2026, among EquipmentShare.com Inc, the guarantors party thereto, Wells Fargo Bank, National Association, as agent and the lenders party thereto. | X | ||||||
10.2*# | Form of Lease Agreement with Related Parties | X | ||||||
31.1 | Certification of the Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | ||||||
31.2 | Certification of the Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X | ||||||
32.1** | Certification of the Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | X | ||||||
32.2** | Certification of the Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | X | ||||||
101.IN S | Inline XBRL Instance Document | |||||||
101.SC H | Inline XBRL Taxonomy Extension Schema Document | |||||||
101.CA L | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
101.DE F | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
101.LA B | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
101.PR E | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
*Exhibits and schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K and will be
provided on a supplemental basis to the Securities and Exchange Commission upon request.
#Portions of this exhibit have been redacted in compliance with Regulation S-K Item 601(a)(6) and Item
601(b)(10).
**This certification is deemed not filed for purposes of section 18 of the Exchange Act, or otherwise subject
to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the
Securities Act or the Exchange Act.
57
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned thereunto duly authorized.
EquipmentShare.com Inc | ||||
Date: | May 14, 2026 | By: | /s/ David Marquardt | |
Name: | David Marquardt | |||
Title: | Chief Financial Officer and Chief Accounting Officer | |||
FAQ
How did EquipmentShare (EQPT) perform financially in Q1 2026?
EquipmentShare generated $989 million of revenue in Q1 2026, up from $716 million a year earlier. Operating income was about $1 million, and net loss improved to $29 million versus $48 million, translating to a loss of $0.20 per share.
What impact did the IPO have on EquipmentShare (EQPT) in early 2026?
In January 2026, EquipmentShare completed an IPO of 30.5 million Class A shares at $24.50, raising $747 million in gross and $706 million in net proceeds. Convertible preferred stock of $430 million converted into 142 million Class A shares, significantly boosting equity.
What is EquipmentShare’s (EQPT) debt and interest expense position?
As of March 31, 2026, EquipmentShare had $3.139 billion of long-term debt and lines of credit, including $999 million drawn on its asset-based revolving facility. Quarterly interest expense was $70 million, creating a substantial drag on net profitability.
How strong is EquipmentShare’s (EQPT) liquidity after Q1 2026?
EquipmentShare ended Q1 2026 with $329 million in cash and cash equivalents and an asset base of $6.357 billion. Under its asset-based revolving credit facility, it reported a borrowing base of $2.280 billion and net excess availability of $1.276 billion.
How fast is EquipmentShare’s telematics and platform business growing?
Q1 2026 platform revenue totaled $50 million, including $31 million from telematics and $19 million from other platform services. This compares with $18 million of platform revenue a year earlier, reflecting rapid expansion of the T3 technology offering alongside core rentals.
What are EquipmentShare’s (EQPT) main cost and cash flow pressures?
Key pressures include $702 million of cost of revenues in Q1 2026, $286 million in selling, general and administrative expenses, and $70 million in interest expense. Net cash used in operating activities reached $200 million, influenced by working capital movements and non-cash charges.