EquipmentShare.com Q3 net income rises to $20M
The $1.35 billion notes mature in 2034, while the board authorized up to $500 million in repurchases through December 31, 2028.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
10-Q
EquipmentShare.com Inc reported third-quarter revenue of $1.468 billion for the three months ended September 30, 2026, versus $945 million a year earlier. Net income was $20 million versus $6 million, and net income attributable to common shareholders was $9 million versus a $5 million loss. Equipment rental and related services contributed $985 million; equipment sales contributed $294 million.
For the first nine months of 2026, revenue was $3.905 billion versus $2.808 billion, and net income was $10 million versus a $25 million loss. Operating activities used $179 million of cash, compared with $14 million in the prior-year period; investing activities used $1.357 billion. Long-term debt, net of current portion, original issue discounts and debt issuance costs, was $4.227 billion as of September 30, 2026.
On July 1, the company issued $1.35 billion of 7.125% Senior Secured Second Lien Notes due 2034, generating $1.339 billion in net proceeds. Gross proceeds were used to repay the ABL revolving facility, pay related fees and expenses, and for general corporate purposes. The board authorized up to $500 million of Class A repurchases through December 31, 2028; no program repurchases occurred in the first nine months of 2026.
2 points · 0 major0 major · 1 point
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointThird-quarter revenue was $1.468 billion, versus $945 million in 2025.
- Moderate pointThird-quarter net income was $20 million, versus $6 million in 2025.
Negative
- Moderate pointOperating cash use was $179 million, versus $14 million in 2025.
Filing Explained
This 10-Q says the founder awards could issue up to 18,321,644 Class B shares to each founder; issuance remains subject to market and service conditions, so any shares issued would dilute existing holders’ percentage ownership. One tranche’s market hurdle has been met for 6,485,862 units in aggregate, but service vesting remains required; the other
Key Figures
Third-quarter revenue: $1.468 billion
Third-quarter net income: $20 million
Net cash used in operating activities: $179 million
+4 more
7 metrics
Third-quarter revenue
$1.468 billion
Three months ended September 30, 2026; $945 million in 2025
Third-quarter net income
$20 million
Three months ended September 30, 2026; $6 million in 2025
Net cash used in operating activities
$179 million
Nine months ended September 30, 2026; $14 million in 2025
Long-term debt, net of current portion, original issue discounts and debt issuance costs
$4.227 billion
As of September 30, 2026
Net excess availability under ABL Credit Facility
$1.939 billion
As of September 30, 2026
2034 Senior Secured Second Lien Notes issued
$1.35 billion
Issued July 1, 2026; 7.125% interest; due 2034
Class A share repurchase authorization
Up to $500 million
Authorized through December 31, 2028
Key Terms
OWN Program, net excess availability, Senior Secured Second Lien Notes, borrowing base, +1 more
5 terms
OWN Program technical
"Under the OWN Program, the Company leases equipment owned by participants"
net excess availability financial
"the net excess availability at September 30, 2026"
Senior Secured Second Lien Notes financial
"7.125% Senior Secured Second Lien Notes due 2034"
A senior secured second lien note is a type of loan or bond that is backed by specific company assets but is paid after a first‑lien lender if those assets must be sold. Think of it as two people holding a mortgage on the same house: the first person gets paid from a sale first, and the second person gets whatever remains; because of that lower payout priority, second‑lien notes usually offer higher interest to compensate investors for the added risk. Investors watch these for the trade-off between higher yield and greater recovery uncertainty in a default.
borrowing base financial
"a borrowing base, as defined in the ABL Credit Facility"
A borrowing base is the amount a lender will allow a company to borrow based on the value of assets the company offers as security, typically things like accounts receivable and inventory. It matters to investors because it sets a practical ceiling on short-term financing and influences a company’s liquidity and risk: if the borrowing base falls, the company may lose access to cash or be forced to sell assets, which can affect operations and share value.
straight-line basis financial
"recognized on a straight-line basis over the contract term"
A straight-line basis is an accounting method that spreads the cost of a long-lived asset or intangible evenly over its useful life, recording the same expense amount each reporting period. For investors, it makes a company’s profits and asset values more predictable and comparable—like slicing a loaf into equal pieces—so changes in reported earnings are more likely to reflect business performance than timing quirks in how costs are recognized.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How much revenue did EQPT report in the third quarter of 2026?
EquipmentShare.com Inc reported third-quarter revenue of $1.468 billion for the three months ended September 30, 2026, compared with $945 million in the same 2025 period. Equipment rental and related services contributed $985 million.
What are EQPT's ABL prepayment terms for OWN Program proceeds?
The amended ABL terms require the company to prepay 100% of net cash proceeds from OWN Program transfers within five business days after specified trigger events. The prepayments do not reduce revolving commitments, and the company must provide monthly reporting of the proceeds to the administrative agent.
AI-generated analysis. How Rhea-AI works. Not financial advice.
See more from StockTitan in Google Search and AI answers.
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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________________________
FORM 10-Q
For the quarterly period ended September 30, 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 November 6, 2026, the registrant had 216,171,299 shares of Class A common stock outstanding and 37,568,944 shares of Class B common stock outstanding.
Table of Contents
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 September 30, 2026 and December 31, 2025 | 6 | |
Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2026 and 2025 | 7 | |
Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2026 and 2025 | 8 | |
Condensed Consolidated Statements of Perpetual Preferred Stock and Equity for the Three and Nine Months Ended September 30, 2026 and 2025 | 9 | |
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2026 and 2025 | 11 | |
Notes to Condensed Consolidated Financial Statements | 12 | |
Item 2 | Management’s Discussion and Analysis of Financial Conditions and Results of Operations | 38 |
Item 3 | Quantitative and Qualitative Disclosures About Market Risk | 66 |
Item 4 | Controls and Procedures | 67 |
PART II | OTHER INFORMATION | |
Item 1 | Legal Proceedings | 68 |
Item 1A | Risk Factors | 68 |
Item 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 68 |
Item 5 | Other Information | 69 |
Item 6 | Exhibits and Financial Statement Schedules | 70 |
3
Table of Contents
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 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;
4
Table of Contents
•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;
•Risks related to attacks by short sellers and associated litigation and regulatory inquiries; 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 the 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.
5
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
Table of Contents
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except par value)
Unaudited
September 30, 2026 | December 31, 2025 | ||
ASSETS | |||
Cash and cash equivalents ..................................................................................................................................... | $ | $ | |
Accounts receivable, net(1) .................................................................................................................................... | |||
Inventories ............................................................................................................................................................. | |||
Prepaid costs(2) ...................................................................................................................................................... | |||
Other current assets ............................................................................................................................................... | |||
Total current assets ....................................................................................................................................... | |||
Rental equipment, net ........................................................................................................................................... | |||
Property and other fixed assets, net ...................................................................................................................... | |||
Capitalized software, net ....................................................................................................................................... | |||
Right of use assets, operating(3) ............................................................................................................................. | |||
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(4) ............................................................................................... | |||
Finance lease liabilities, net of current portion(5) .................................................................................................. | |||
Financing obligations, net of current portion ........................................................................................................ | |||
Deferred tax liabilities, net .................................................................................................................................... | |||
Other liabilities ...................................................................................................................................................... | |||
Total liabilities ............................................................................................................................................. | |||
Perpetual preferred stock, net - $ outstanding at September 30, 2026 and December 31, 2025, respectively .......................................................... | |||
Common stock - $ 2026, | |||
Class A common stock - $ at September 30, 2026, | |||
Class B common stock - $ September 30, 2026, | |||
Convertible preferred stock, net - $ September 30, 2026, | |||
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 ................................................................................. | $ | $ |
__________________
(1)Includes amounts due from investees and related parties of $47 and $20 as of September 30, 2026 and December 31, 2025, respectively.
(2)Includes amounts with investees of $3 and $2 as of September 30, 2026 and December 31, 2025, respectively.
(3)Includes amounts with related parties of $12 and $6 as of September 30, 2026 and December 31, 2025, respectively.
(4)Includes amounts with related parties of $11 and $5 as of September 30, 2026 and December 31, 2025, respectively.
(5)Includes amounts with related parties of $48 and $28 as of September 30, 2026 and December 31, 2025, respectively.
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
Unaudited
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
REVENUES | |||||||
Equipment rental and related services ................................................................... | $ | $ | $ | $ | |||
Equipment sales(1) .................................................................................................. | |||||||
Equipment parts and supplies and services(2) ......................................................... | |||||||
Platform: ................................................................................................................ | |||||||
Telematics(3) ........................................................................................................ | |||||||
Other .................................................................................................................... | |||||||
Total revenues .................................................................................................. | |||||||
COST OF REVENUES | |||||||
Direct operating costs ............................................................................................ | |||||||
OWN Program payouts(4) ....................................................................................... | |||||||
Equipment sales ..................................................................................................... | |||||||
Platform expense .................................................................................................... | |||||||
Depreciation and amortization ............................................................................... | |||||||
Total cost of revenues ......................................................................................... | |||||||
Gross profit ......................................................................................................... | |||||||
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES(5) .................... | |||||||
Operating income ............................................................................................... | |||||||
OTHER INCOME (EXPENSE) | |||||||
Interest expense ...................................................................................................... | ( | ( | ( | ( | |||
Other income, net(6) ................................................................................................ | |||||||
Total other expense, net ...................................................................................... | ( | ( | ( | ( | |||
INCOME (LOSS) BEFORE INCOME TAXES .................................................. | ( | ||||||
Provision for (benefit from) income taxes ................................................................ | ( | ( | |||||
NET INCOME (LOSS) .......................................................................................... | $ | $ | $ | $( | |||
Deemed dividends on perpetual preferred stock ....................................................... | ( | ( | ( | ( | |||
Net income (loss) attributable to common shareholders .......................................... | $ | $( | $( | $( | |||
Weighted average common shares outstanding: ....................................................... | |||||||
Basic ....................................................................................................................... | |||||||
Diluted (Class A and Common Stock) ................................................................... | |||||||
Diluted (Class B) .................................................................................................... | N/A | N/A | |||||
Earnings (loss) per common share: ........................................................................... | |||||||
Basic earnings (loss) per common share ................................................................ | $ | $( | $( | $( | |||
Diluted earnings (loss) per common share (Class A and Common Stock) ............ | $ | $( | $( | $( | |||
Diluted earnings (loss) per common share (Class B) ............................................. | $ | N/A | $( | N/A | |||
__________________
(1)Includes amounts earned from related parties of $— and $8 for the three months ended September 30, 2026 and 2025, respectively, and $—
and $79 for the nine months ended September 30, 2026 and 2025, respectively.
(2)Includes amounts earned from related parties of less than $0.1 and $1 for the three months ended September 30, 2026 and 2025,
respectively, and $0.1 and $4 for the nine months ended September 30, 2026 and 2025, respectively.
(3)Includes amounts earned from investees and related parties of $9 and $0.9 for the three months ended September 30, 2026 and 2025,
respectively, and $27 and $2 for the nine months ended September 30, 2026 and 2025, respectively.
(4)Includes amounts incurred from related parties of less than $0.1 and $16 for the three months ended September 30, 2026 and 2025,
respectively, and $0.7 and $45 for the nine months ended September 30, 2026 and 2025, respectively.
(5)Includes amounts incurred from investees and related parties of $6 and $6 for the three months ended September 30, 2026 and 2025,
respectively, and $15 and $15 for the nine months ended September 30, 2026 and 2025, respectively.
(6)Includes amounts earned from related parties of $3 and $3 for the three months ended September 30, 2026 and 2025, respectively, and $10
and $6 for the nine months ended September 30, 2026 and 2025, respectively.
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In millions)
Unaudited
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Net income (loss) ...................................................................................................... | $ | $ | $ | $( | |||
Other comprehensive income (loss): | |||||||
Reclassification of net loss from derivative instruments, net of tax .................... | ( | ( | |||||
Change in fair value of derivative instruments, net of tax ................................... | ( | ||||||
Unrealized loss on available-for-sale debt securities ........................................... | ( | ( | |||||
COMPREHENSIVE INCOME (LOSS) ............................................................... | $ | $ | $ | $( | |||
The accompanying notes are an integral part of these condensed consolidated financial statements.
9
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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 July 1, 2026 ........................................ | $ | $ | $ | $ | $ | $( | $ | $( | $ | $ | |||||||||||||||||||
Net income ......................................................... | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Reclassification of net loss from derivative instruments, net of tax ........................................ | – | – | – | – | – | – | – | – | – | – | – | – | – | ( | ( | ||||||||||||||
Unrealized loss on available-for-sale debt securities ............................................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ( | ( | ||||||||||||||
Accretion of perpetual preferred stock to redemption value ................................................ | – | – | – | – | – | – | – | – | – | – | ( | – | – | ( | |||||||||||||||
Exercises of stock options .................................. | – | – | – | – | – | – | – | – | – | – | – | – | |||||||||||||||||
Stock-based compensation ................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Balance at September 30, 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 (Loss) | Equity | |||||||||||||||
Balance at July 1, 2025 ........................................ | $ | $ | $ | $ | $ | $( | $ | $( | $ | $ | |||||||||||||||||||
Net income ......................................................... | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Accretion of perpetual preferred stock to redemption value ................................................ | – | – | – | – | – | – | – | – | – | – | ( | – | – | ( | |||||||||||||||
Acquisition of businesses and other assets ......... | – | – | – | – | – | – | – | – | – | – | – | – | |||||||||||||||||
Exercises of stock options .................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Stock-based compensation ................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Balance at September 30, 2025 ........................... | $ | $ | $ | $ | $ | $( | $ | $( | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
10
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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 income ......................................................... | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Reclassification of net loss from derivative instruments, net of tax ........................................ | – | – | – | – | – | – | – | – | – | – | – | – | – | ( | ( | ||||||||||||||
Unrealized loss 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 ................................................ | – | – | – | – | – | – | – | – | – | – | ( | – | – | ( | |||||||||||||||
Dividends on perpetual preferred stock .............. | – | – | – | – | – | – | – | – | – | – | – | – | ( | – | ( | ||||||||||||||
Exercises of stock options .................................. | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||||
Stock-based compensation ................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Balance at September 30, 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 (Loss) | Equity | |||||||||||||||
Balance at January 1, 2025 ................................. | $ | $ | $ | $ | $ | $( | $ | $ | $ | $ | |||||||||||||||||||
Net loss ............................................................... | – | – | – | – | – | – | – | – | – | – | – | – | ( | – | ( | ||||||||||||||
Change in fair value of derivative instruments, net of tax ............................................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ( | ( | ||||||||||||||
Accretion of perpetual preferred stock to redemption value ................................................ | – | – | – | – | – | – | – | – | – | – | ( | – | – | ( | |||||||||||||||
Dividends on perpetual preferred stock .............. | – | – | – | – | – | – | – | – | – | – | – | – | ( | – | ( | ||||||||||||||
Acquisition of businesses and other assets ......... | – | – | – | – | – | – | – | – | – | – | – | – | |||||||||||||||||
Exercises of stock options .................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Stock-based compensation ................................. | – | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||
Balance at September 30, 2025 ........................... | $ | $ | $ | $ | $ | $( | $ | $( | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
11
Table of Contents
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
Unaudited
Nine Months Ended September 30, | |||
2026 | 2025 | ||
OPERATING ACTIVITIES | |||
Net income (loss) ....................................................................................................................................... | $ | $( | |
Adjustments to reconcile net income (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(1) .............................................................................................................. | ( | ( | |
Proceeds from sale of rental equipment(2) ............................................................................................... | |||
Purchases of and deposits on property and other fixed assets ................................................................. | ( | ( | |
Proceeds from sale of 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 | |||
Proceeds from long-term debt ................................................................................................................. | |||
Payments on long-term debt .................................................................................................................... | ( | ( | |
Payments of debt issuance costs .............................................................................................................. | ( | ( | |
Payments on finance leases(3) .................................................................................................................. | ( | ( | |
Proceeds on financing obligations ........................................................................................................... | |||
Payments on financing obligations ......................................................................................................... | ( | ( | |
Dividends paid on perpetual preferred stock ........................................................................................... | ( | ( | |
Proceeds from issuance of Class A common stock upon initial public offering, net of underwriting discount and commissions .................................................................................................................... | |||
Payments of equity issuance costs .......................................................................................................... | ( | ||
Exercise of stock options ......................................................................................................................... | |||
Other ........................................................................................................................................................ | ( | ||
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 and manufacturer flooring plans ............ | $ | $ | |
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 .......................................................... | |||
Equity issued in exchange for acquisition of business and other assets .................................................. | |||
__________________
(1)Includes amounts from related parties of $— and $27 for the nine months ended September 30, 2026 and 2025, respectively.
(2)Includes amounts from related parties of $— and $55 for the nine months ended September 30, 2026 and 2025, respectively.
(3)Includes amounts to related parties of $3 and $3 for the nine months ended September 30, 2026 and 2025, respectively.
12
Table of Contents
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 T3 platform, 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 our T3
platform. 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 September 30, 2026, the Company had 408 full-service branches, 9 dealership sites, and 31 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
13
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 (“RSUs”), as applicable, except that Class B shares will be issuable
upon exercise or vesting of options and RSUs 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 September 30, 2026, and its results of operations, changes in perpetual
preferred stock and equity, and cash flows, for the three and nine months ended September 30, 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 Company’s significant accounting
policies are described in Note 2. Summary of Significant Accounting Policies in the 2025 Form 10-K. 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 and nine months ended September 30, 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 Financial
Accounting Standards Board (“FASB”) issued Accounting Standards Update (“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
14
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 FASB Accounting Standards Codification (“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 2025-12 on its consolidated financial statements and related
disclosures.
3.ACCOUNTS RECEIVABLE, NET
September 30, 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 .................................................................................. | $ | $ |
15
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
4.INVENTORIES
September 30, 2026 | December 31, 2025 | ||
Equipment inventory .......................................................................................... | $ | $ | |
Equipment parts .................................................................................................. | |||
Telematics hardware .......................................................................................... | |||
Building materials, supplies, small tools, and other ........................................... | |||
Total inventories .............................................................................................. | $ | $ |
5.RENTAL EQUIPMENT, NET
September 30, 2026 | December 31, 2025 | ||
Rental equipment ................................................................................................ | $ | $ | |
Installed telematics tracker devices .................................................................... | |||
Total rental equipment ....................................................................................... | |||
Less: accumulated depreciation ......................................................................... | ( | ( | |
Rental equipment, net ......................................................................................... | $ | $ |
During the three and nine months ended September 30, 2026, the Company recognized $100 million and $272
million related to rental equipment depreciation expense, respectively. During the three and nine months ended
September 30, 2025, the Company recognized $79 million and $218 million related to rental equipment depreciation
expense, respectively. Rental equipment related depreciation expense is recognized within depreciation and
6.PROPERTY AND OTHER FIXED ASSETS, NET
September 30, 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 ..................................................... | $ | $ |
During the three and nine months ended September 30, 2026, the Company recognized $17 million and $46
million related to property and other fixed assets depreciation expense, respectively. During the three and nine
months ended September 30, 2025, the Company recognized $11 million and $29 million related to property and
other fixed assets depreciation expense, respectively. Property and other fixed assets related depreciation expenses
are recognized in selling, general and administrative expenses on the condensed consolidated statement of
operations.
16
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
7.CAPITALIZED SOFTWARE, NET
September 30, 2026 | December 31, 2025 | ||
Capitalized software ........................................................................................... | $ | $ | |
Less: accumulated amortization ......................................................................... | ( | ( | |
Total capitalized software, net ...................................................................... | $ | $ |
During the three and nine months ended September 30, 2026, the Company recognized $8 million and $22
million related to capitalized software amortization expense, respectively. During the three and nine months ended
September 30, 2025, the Company recognized $6 million and $15 million related to capitalized software
amortization expense, respectively. Capitalized software amortization expense is recognized within depreciation and
amortization as a component of cost of revenues on the condensed consolidated statements of operations.
8.ACCRUED LIABILITIES
September 30, 2026 | December 31, 2025 | ||
Accrued expenses ............................................................................................... | $ | $ | |
Accrued inventory purchases ............................................................................. | |||
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 ................................................................................. | $ | $ |
17
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
9.LONG-TERM DEBT AND LINES OF CREDIT
September 30, 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 | |||
Senior Secured Second Lien Notes bearing interest at a rate of | |||
Notes payable to various institutions, bearing interest at rates ranging from equipment ................................................................................................. | |||
Equipment financing lines of credit with various institutions, bearing interest at | |||
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 during the three months ended
December 31, 2025, 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.
On April 15, 2026, the Company amended the ABL Credit Facility (the “Amendment”). The Amendment
revised the mandatory prepayment provisions applicable to net cash proceeds received from transfers under the
OWN Program. Under the amended terms, the Company is required to prepay outstanding borrowings under the
ABL Credit Facility with 100 % of such net cash proceeds within five business days following the occurrence of
specified trigger events. The Amendment also specifies the application of such prepayments to outstanding
borrowings without reducing revolving commitments and requires the Company to provide monthly reporting of net
cash proceeds from OWN Program transfers to the administrative agent. No other material terms of the ABL Credit
Facility were amended.
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
18
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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
September 30, 2026, availability under the ABL Credit Facility exceeded this threshold and, as a result, the financial
covenant was not applicable.
As of September 30, 2026, the Company had $806 million outstanding under the ABL Credit Facility bearing
interest at the SOFR of 5.26 %, included in long-term debt on the condensed consolidated balance sheets.
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 September 30, 2026, the
Company had a borrowing base, as defined in the ABL Credit Facility, of $2,750 million. After outstanding
borrowings and letters of credit, the net excess availability at September 30, 2026, as defined in the ABL Credit
Facility, was $1,939 million, of which the Company could borrow up to $1,664 million without any additional
repayment conditions.
Senior Secured Second Lien Notes due 2034
On July 1, 2026, the Company issued $1,350 million in aggregate principal amount of 7.125 % Senior Secured
Second Lien Notes due 2034 (the “2034 Notes”). The 2034 Notes were issued pursuant to the indenture, dated as of
July 1, 2026, between the Company and Citibank, N.A., as trustee and notes collateral agent. The 2034 Notes bear
interest at a rate of 7.125 % per year and interest is payable semi-annually in arrears on July 1 and January 1 of each
year. The 2034 Notes will mature on July 1, 2034. The 2034 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,
the Company’s 2028 Notes, 2032 Notes and 2033 Notes. The 2034 Notes had no original issue discounts and the
Company incurred $11 million in underwriting expenses. Net proceeds from the issuance of the 2034 Notes was
$1,339 million. Upon the issuance of the 2034 Notes, the Company capitalized $16 million of bond offering costs.
The Company used the gross proceeds from this offering (i) to repay its revolving credit facility under the ABL
Credit Facility, (ii) to pay fees and expenses in connection with the foregoing, and (iii) for general corporate
purposes.
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 September 30, 2026, the Company was in compliance with those
restrictions and financial covenants.
As of September 30, 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 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.
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
the condensed consolidated statements of operations (in millions):
Statements of Operations | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||
Component of Lease Cost | Line Item | 2026 | 2025 | 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 | |||||||||
Short-term lease cost ................ | Selling, general and administrative expenses | |||||||||
Total lease expense .................. | $ | $ | $ | $ | ||||||
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 the IPO date, January 26, 2026, the
Company had 3,500 million authorized shares of Class A common stock and approximately 215
Class A common stock issued and outstanding, along with 200 million authorized shares of Class B common stock
and approximately 38
Share Repurchase Program
On July 9, 2026, the Company’s Board approved a share repurchase program (the “Share Repurchase
Program”) with authorization to purchase up to $500 million in shares of the Company’s Class A common stock
through the expiration of the Share Repurchase Program on December 31, 2028. Repurchases under the Share
Repurchase Program may be made from time to time in the open market at prevailing market prices, in privately
negotiated transactions, in block trades and through other legally permissible means, with the amount and timing of
repurchases to be determined at the Company’s discretion, depending on market conditions and corporate needs.
Open market repurchases will be structured to occur in accordance with applicable federal securities laws, including
within the pricing and volume requirements of Rule 10b-18 under the Exchange Act, as amended. The Company
may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this
authorization. This program does not obligate the Company to acquire any particular amount of Class A common
stock and may be modified, suspended or terminated at any time at the discretion of the Board. The Company did
ended September 30, 2026.
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
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EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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 nine
months ended September 30, 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, RSUs, PSUs,
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.
RSUs
During the nine months ended September 30, 2026, the Company granted 812,224 RSUs under the 2025 Plan
with an average grant date price per unit of $19.80 (fair value of $16 million) to certain service providers. For most
awards, the Company records stock-based compensation expense on a straight-line recognition method over the
requisite service period for the entire award. Each RSU represents the right to receive one share of Class A common
stock at a future date. The RSUs vest equally over four years , the first 25 % of the RSU award vests after one year
from grant date, and the remaining 75% of the RSU award vests on a quarterly basis thereafter. These RSUs will be
settled within 60 days of vesting. From these RSU awards, 21,353 RSUs vested, and 146,175 RSUs were forfeited.
Stock-based compensation expense was $1 million and $1 million for the RSUs during the three and nine months
ended September 30, 2026, respectively. As of September 30, 2026, the Company had a total of 644,696 unvested
RSUs outstanding and the total pretax compensation cost not yet recognized was $11 million. The weighted average
period over which this compensation cost is expected to be recognized is 3.1 years.
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
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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 |
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 ........................................................................... |
During the three months ended March 31, 2026, the market condition for Tranche 1 was achieved. Accordingly,
approximately 17.70 % of the IPO Founders Awards (6,485,862 PSUs in the aggregate) had satisfied the applicable
market condition and remain subject to the related service-based vesting requirement. The remaining 82.30 % of the
IPO Founder Awards continue to be subject to achievement of the applicable market conditions and service-based
vesting requirements.
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
$26 million and $68 million was recorded for the IPO Founders Awards during the three and nine months ended
September 30, 2026, respectively, and is included in selling, general and administrative expenses in the condensed
consolidated statements of operations. As of September 30, 2026, the unrecognized stock-based compensation
expense yet to be recognized over the vesting period was $23 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 7.0 years as of September 30, 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
22
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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 September 30, 2026, the Company has a total of 22,525,256 options authorized. There were 8,265,536
options issued and outstanding.
Stock-based compensation expense of $1 million and $1 million was recorded for vested time-based options
during the three and nine months ended September 30, 2026, respectively, and stock-based compensation expense of
$1 million and $3 million was recorded for the three and nine months ended September 30, 2025, respectively, and
is included in selling, general and administrative expenses in the condensed consolidated statements of operations.
As of September 30, 2026, the unrecognized stock-based compensation expense yet to be recognized over the
vesting period was $4 million. The weighted average remaining life of the outstanding stock options was 1.2 years
as of September 30, 2026.
respectively. The Company recognized less than $0.1
option awards during each of the three and nine months ended September 30, 2026 and 2025, respectively. It is not
probable that the performance conditions will be achieved in the next 12 months. The Company had 320,000
unvested milestone-based option awards granted in 2022 outstanding as of September 30, 2026. If the 2022 award
milestones, as defined, are not achieved by January 31, 2032, then these unvested options will be forfeited. The
estimated unrecognized stock-based compensation expense to be recognized if and when the performance conditions
are considered probable of being achieved could be up to $0.4 million for the 2022 awards as of September 30,
2026. The weighted average remaining life of the outstanding milestone-based stock option awards was 5.3 years for
the 2022 awards as of September 30, 2026.
RSUs
During the nine months ended September 30, 2026, the Company granted 149,698 RSUs under the 2016 Plan
with a weighted average grant date price per unit of $22.78 (fair value of $3 million). From this grant, 24,007 RSUs
vested, and 9,003 RSUs were forfeited. As of September 30, 2026, the Company had a total of 116,688 unvested
RSUs outstanding and the total pretax compensation cost not yet recognized by the Company for unvested RSUs
was $2 million. The weighted average period over which this compensation cost is expected to be recognized is 0.8
years.
The Company issued performance-based 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 became vested. For the three and nine months ended September 30,
2026, the Company recognized $1 million and $3 million, respectively, of stock-based compensation expense
attributable to RSUs. No
nine months ended September 30, 2025, as the performance-based vesting condition had not been satisfied at that
23
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 September 30, | |||||||||||
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 and supplies and services: | |||||||||||
Equipment parts and supplies sales ................ | |||||||||||
Services .......................................................... | |||||||||||
Total equipment parts and supplies and services | |||||||||||
Platform revenue: | |||||||||||
Telematics ...................................................... | |||||||||||
Other .............................................................. | |||||||||||
Total revenues ..................................................... | $ | $ | $ | $ | $ | $ | |||||
__________________
(1)For the three months ended September 30, 2026 and 2025, equipment sales to OWN Program participants were $243 million and $104
million, respectively. For the three months ended September 30, 2026 and 2025, equipment sales to contractors and other end users were
$51 million and $63 million, respectively.
Nine Months Ended September 30, | |||||||||||
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 and supplies and services: | |||||||||||
Equipment parts and supplies sales ................ | |||||||||||
Services .......................................................... | |||||||||||
Total equipment parts and supplies and services | |||||||||||
Platform revenue: | |||||||||||
Telematics ...................................................... | |||||||||||
Other .............................................................. | |||||||||||
Total revenues ..................................................... | $ | $ | $ | $ | $ | $ | |||||
__________________
(1)For the nine months ended September 30, 2026 and 2025, equipment sales to OWN Program participants were $773 million and $615
million, respectively. For the nine months ended September 30, 2026 and 2025, equipment sales to contractors and other end users were
$182 million and $175 million, respectively.
24
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
The Company's Equipment Rental and Services Operations segment revenue (see Note 18. Segment
Information) is comprised of equipment rental and related services and equipment parts and 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. Segment Information), 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 $459 million and $1,217 million for the three and nine months ended
September 30, 2026, respectively, and $360 million and $898 million for the three and nine months ended
September 30, 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
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.
25
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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
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 revenue: 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 and nine months
ended September 30, 2026 or 2025 that were contract liabilities at the beginning of such periods.
13.INCOME TAXES
Income tax expense was $16 million and income tax benefit was $2 million for the three and nine months ended
September 30, 2026, respectively. Income tax expense was $9 million and income tax benefit was $23 million for
the three and nine months ended September 30, 2025, respectively. The effective tax rate for the periods differed
from the statutory rate primarily due to the Section 162(m) limitation on the annual effective tax rate and discrete
excess tax benefits from stock-based compensation.
26
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
14.RELATED PARTY TRANSACTIONS
The Company discloses material related party transactions, balances, and relationships in accordance with
ASC 850, Related Party Disclosures. Management evaluates all related party transactions for proper accounting,
disclosure, and potential conflicts of interest.
Transactions with Investee
The Company has a 50.0 % ownership interest in 10G LLC (“10G”), a joint venture that designs, develops,
engineers, tests and distributes electronic components and warehouses and sells electronic systems and products.
The joint venture arrangement is accounted for under the equity method. For the three and nine months ended
September 30, 2026, the Company recognized revenue from sales to 10G of $9 million and $27 million,
respectively, which is included in telematics platform revenue on the condensed consolidated statements of
operations. For the period from September 19, 2025 to September 30, 2025, the Company recognized revenue from
sales to 10G of $0.8 million, which is included in telematics platform revenue on the condensed consolidated
statements of operations. At September 30, 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 less than $0.1 million and $0.2 million, respectively, which are
included in accounts payable on the consolidated balance sheets.
The Company has 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 and nine months ended September 30, 2026, the Company purchased insurance policies through this equity
method investee and recognized $4 million and $9 million of insurance expense in selling, general and
administrative expenses on the condensed consolidated statements of operations, respectively. For the three and nine
months ended September 30, 2025, the Company purchased insurance policies through this equity method investee
and recognized $2 million and $6 million of insurance expense in selling, general and administrative expenses on the
condensed consolidated statements of operations, respectively. At September 30, 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.
Prior to September 19, 2025, the Company purchased telematics tracker devices from an equity method
investee, The Morey Corporation (“Morey”), totaling approximately $4 million and $11 million for the three and
nine months ended September 30, 2025, respectively. Design and development services paid to Morey were $0.1
million and $0.5 million for the three and nine months ended September 30, 2025, respectively, and included in
selling, general and administrative expenses on the condensed consolidated statements of operations. On September
19, 2025, the Company entered into a stock purchase agreement to acquire 50.1 % of the common stock of Morey,
increasing the Company’s ownership interest from 49.9 % to 100 %. The transaction resulted in Morey becoming a
wholly-owned subsidiary of the Company.
Transactions with Entities Owned or Controlled by the Founders
The Company periodically enters into transactions with entities that are either owned or controlled by the
Company’s Chief Executive Officer or President (the “Founders”).
Revenues
The Company recognized the following revenues from transactions with entities owned or controlled by the
Founders:
•The Company recognized less than $0.1 million and $0.3 million for the three and nine months ended
September 30, 2026, respectively, of equipment rental and related services revenues. The Company
recognized equipment rental and related services revenue of approximately $0.1 million and approximately
$0.2 million during the three and nine months ended September 30, 2025, respectively.
27
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
•During the three and nine months ended September 30, 2025, the Company recognized equipment sales
revenue of $15 million and $128 million, respectively. A portion of the equipment sales for the three and
nine months ended September 30, 2025, were agent OEM transactions and the related cost of the equipment
sold of $7 million and $49 million, respectively, is presented net of the associated equipment sales revenues
for these periods on the condensed consolidated statements of operations. The equipment sold was
subsequently listed on the Company’s marketplace under the OWN Program. There were no
sales to related parties during the three and nine months ended September 30, 2026.
•The Company recognized equipment parts and supplies revenue of less than $0.1 million and $0.1 million
during the three and nine months ended September 30, 2026, respectively. During the three and nine
months ended September 30, 2025, the Company recorded equipment parts and supplies revenue of $1
million and $4 million, respectively.
•The Company recognized T3 telematics services revenue of less than $0.1 million and $0.1 million during
the three and nine months ended September 30, 2026, respectively, relating to equipment enrolled under the
OWN Program. During the three and nine months ended September 30, 2025, the Company recorded T3
telematics services revenue of less than $0.1 million and $0.7 million, respectively, relating to equipment
enrolled under the OWN Program.
•During the three and nine months ended September 30, 2026, the Company recognized $0.1 million and
$0.5 million, respectively, and during the three and nine months ended September 30, 2025, the Company
recognized $1 million and $1 million, 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 less than $0.1 million and $0.7
million for the three and nine months ended September 30, 2026, respectively, and $16 million and $45 million for
the three and nine months ended September 30, 2025, respectively. These amounts are included in cost of revenues
on the condensed consolidated statements of operations.
At September 30, 2026, there was approximately $0.1 million included in accrued expenses for amounts due
under the OWN Program to entities owned or controlled by the Founders. At December 31, 2025, no amounts were
included in accrued expenses for amounts due under the OWN Program to entities owned or controlled by the
Founders.
Assignment of property site purchase rights and construction developer fees
For the three and nine months ended September 30, 2026, the Company recognized $2 million and $4 million,
respectively, of other miscellaneous income for the assignment of new property site purchase rights and related
transaction services, and for the three and nine months ended September 30, 2025, the Company recognized $2
million and $3 million, respectively. These amounts are included in other income, net on the condensed consolidated
statements of operations.
For the three and nine months ended September 30, 2026, the Company recognized approximately $1 million
and $5 million, respectively, for construction developer fees and interest provided to entities owned or controlled by
the Founders, and for the three and nine months ended September 30, 2025, the Company recognized $1 million and
$3 million, respectively. These amounts are included in other income, net on the condensed consolidated statements
of operations.
28
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Accounts receivable
At September 30, 2026 and December 31, 2025, the Company had receivables due from entities owned or
controlled by the Founders primarily related to property development costs and the transactions described in this
footnote, in the amounts of $43 million and $19 million, respectively, which are included in accounts receivable 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 $0.4 million and $1
million for the three and nine months ended September 30, 2026, respectively, and were $1 million and $4 million
for the three and nine months ended September 30, 2025, respectively, which are included in direct operating costs
or selling, general and administrative expenses on the condensed consolidated statements of operations. At
September 30, 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 $12 million and $12 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 $2 million for the three and nine months ended September
30, 2026, respectively, and $1 million and $2 million for the three and nine months ended September 30, 2025,
respectively, primarily relating to certain leases and short-term rentals from entities owned or controlled by the
Founders.
During the three and nine months ended September 30, 2026, the Company made payments of $1 million and
$3 million under property finance lease arrangements with entities owned or controlled by the Founders,
respectively. During the three and nine months ended September 30, 2025, the Company made payments of $2
million and $3 million under property finance lease arrangements with entities owned or controlled by the Founders,
respectively. At September 30, 2026 and December 31, 2025, the Company had finance lease liabilities under
finance lease arrangements with entities owned or controlled by the Founders of $49 million and $29 million,
respectively.
Purchases of rental equipment, parts, supplies and other
During the three and nine months ended September 30, 2025, the Company purchased less than $0.1 million
and $22 million, respectively, 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. During the three and nine months ended
September 30, 2026, there were no
owned or controlled by the Founders.
The Company also purchased containers and vehicles for approximately zero and $5 million during the three
and nine months ended September 30, 2025, respectively, and other miscellaneous equipment, parts and supplies for
$0.3 million and $0.5 million, during the three and nine months ended September 30, 2025, respectively, from an
entity owned or controlled by the Founders. The containers and vehicles purchased were added to the Company’s
rental equipment and are included in rental equipment, net on the consolidated balance sheets.
Purchases of property and other fixed assets
During the three and nine months ended September 30, 2026, there were less than $0.1
services provided to the Company by entities owned or controlled by the Founders. During the three and nine
months ended September 30, 2025, entities owned or controlled by the Founders provided construction services to
29
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
the Company in the amounts of less than $0.1 million and $0.4 million, respectively, which were capitalized to
property and other fixed assets.
Accounts payable
At September 30, 2026 and December 31, 2025, amounts due to entities owned or controlled by the Founders
were $0.1 million and $0.1 million, respectively, which are included in accounts payable on the condensed
consolidated balance sheets.
Cash equivalents
As of September 30, 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 a financial institution in which the Founders have
an ownership interest, which is included in cash and cash equivalents on the condensed consolidated balance sheets.
For the three and nine months ended September 30, 2026, the funds on deposit earned interest income of $0.2
million and $0.6 million, respectively, and for the three and nine months ended September 30, 2025 the funds on
deposit earned interest income of $0.2 million and $0.4 million, 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
15.FAIR VALUE MEASUREMENTS AND OTHER
assets) are categorized in the fair value hierarchy as follows (in millions):
September 30, 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 ............................................................................. | $ | $ | $ | $ | |||
30
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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 value of the Company’s ABL facility approximates its book value as of September 30, 2026 and
December 31, 2025, as its benchmark interest rate resets monthly and its contractual credit spread approximates
market spreads for comparable borrowings. The aggregate fair value of the Company’s senior secured second lien
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 $3,421 million and $2,237 million as of September 30, 2026 and
December 31, 2025, respectively.
Investments in equity securities in which the Company does not have significant influence of $33 million and
$29 million as of September 30, 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 September 30, 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 $8 million of realized and unrealized gains on short-term investments
and investments in non-consolidated affiliates during the three and nine months ended September 30, 2026,
respectively, and the Company recognized $19 million and $24 million of realized and unrealized gains on short-
term investments and investments in non-consolidated affiliates during the three and nine months ended September
30, 2025, respectively, which are included in other income, net on the condensed consolidated statements of
operations. Of the realized and unrealized gains recognized for the nine months ended September 30, 2025,
$8 million relates to a remeasurement of the Company’s previously held 49.9 % ownership interest in a non-
consolidated affiliate due to a change in control, and $8 million related to an investment in an equity security that
was carried at cost under the measurement alternative under ASC Topic 321, Investments - Equity Securities and for
which the Company identified an observable price change resulting in the remeasurement of the equity security to
fair value, and are included in other within the net cash used in operating activities on the condensed consolidated
statements of cash flows for the nine months ended September 30, 2025.
The Company recognized $1 million and $5 million of interest income from interest bearing cash and money
market accounts during the three and nine months ended September 30, 2026, respectively, and $2 million and $5
million during the three and nine months ended September 30, 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 nine months ended September 30, 2026, the Company, through its wholly owned subsidiaries,
entered into five separate purchase agreements to acquire substantially all of the business operations of seven
building supplies, lumber, and hardware retail stores for an aggregate purchase price of $5 million, of which $4
million has been paid as of September 30, 2026. The purchase price was preliminarily allocated to the estimated fair
value of receivables, inventories, and other assets and liabilities acquired as of their respective acquisition dates of
$5 million. No goodwill resulted from these transactions. 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.
31
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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. Approximately $5 million of the purchase price was
preliminarily allocated to the estimated fair value of receivables, inventories, fixed assets, and other assets and
liabilities acquired, while the remainder of $1 million was recorded to goodwill. The goodwill relating to this
acquisition is expected to be deductible for income tax purposes over a fifteen year period. Assuming the acquisition
of the business 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.
The Morey Corporation
Prior to 2022, the Company acquired a 49.9 % noncontrolling ownership interest in Morey, a business that
designs, manufactures, and sells custom electronic components, including telematics tracker devices and cloud-
based access control keypads. The Company installs telematics tracker devices and access control keypads on its
rental equipment, as well as equipment owned by third-parties who purchase SaaS subscriptions to the Company’s
T3 platform. On September 19, 2025, the Company entered into a stock purchase agreement to acquire 218,492
shares of common stock of Morey, representing fifty and one-tenths percent (50.1 %) of the outstanding ownership
interest in Morey. The estimated acquisition-date fair value of the purchase price for the 50.1 % controlling
ownership interest in Morey was $33 million, including: (i) cash of $11 million, plus (ii) the issuance of 533,333
shares of the Company’s common shares with an acquisition-date estimated fair value of $9 million, plus (iii) the
repayment of $13 million of debt owed by Morey at closing.
Pursuant to the accounting guidance under Topic 805 in connection with a business combination achieved in
stages, the Company used a provisional estimate of Morey’s equity value to remeasure its previously held 49.9 %
noncontrolling ownership interest in Morey from $14 million to its acquisition-date estimated fair value of
$22 million, recognizing a gain of $8
statements of net income for the three and nine months ended September 30, 2025. The Company measured the
previously held interest based upon the acquisition price of the remaining 50.1 % interest acquired, inclusive of a
control premium consideration. The transaction resulted in Morey becoming a wholly-owned subsidiary of the
Company. As of September 30, 2026, the purchase price accounting for the Morey acquisition has been finalized,
and there were no material measurement period adjustments.
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.
On July 23, 2026, a putative securities class action was filed in the U.S. District Court for the Southern District
of New York against the Company, certain of its current and former officers and directors, and the underwriters of
the Company's IPO. The complaint asserts claims under Sections 11 and 15 of the Securities Act and Sections 10(b)
and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder. The complaint generally alleges that certain
of the Company's public disclosures, including disclosures contained in the registration statement for the Company's
IPO and subsequent public statements, were materially false or misleading or omitted material information
concerning certain related-party transactions and related matters. The complaint seeks, among other relief,
compensatory damages, interest, attorneys fees and costs, and other unspecified relief. The Company believes these
claims are without merit and intends to defend against the action vigorously. This litigation is in its preliminary
stages, and no defendant has yet filed a responsive pleading. Because the matter is at an early stage, the Company
32
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
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.
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.
33
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Three Months Ended September 30, 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 ........................................ | $ | $ | $( | $ | |||
Three Months Ended September 30, 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 ........................................ | $ | $ | $( | $ | |||
34
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Nine Months Ended September 30, 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 ........................................ | $ | $ | $( | $ | |||
Nine Months Ended September 30, 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 ........................................ | $ | $ | $( | $ | |||
35
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 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 ................................................ | |||||||
Income (loss) before income taxes ...................... | $ | $ | $ | $( | |||
September 30, 2026 | December 31, 2025 | ||
Segment identified assets: | |||
Equipment Rental and Service Operations ..................................... | $ | $ | |
Equipment Sales .............................................................................. | |||
All Other ......................................................................................... | |||
Shared Resources ............................................................................ | |||
Total assets ...................................................................................... | $ | $ |
millions):
Nine Months Ended | Nine Months Ended | ||||||
September 30, 2026 | September 30, 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 and nine months ended September 30, 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
36
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
and participating securities. Net income (loss) attributable to common shareholders is calculated by net income
(loss) less dividends accreted on perpetual preferred stock. 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 periods presented 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
income (loss) attributable to common shareholders by the weighted average number of common shares plus the
effect of dilutive potential common shares outstanding during the period.
Three Months Ended September 30, | |||||
2026 | 2025 | ||||
Class A | Class B | Common Stock | |||
Basic earnings per common share: | |||||
Allocation of net income .................................................................. | $ | $ | $ | ||
Less: Deemed dividends on perpetual preferred stock .................... | ( | ( | ( | ||
Net income attributable to common shareholders ........................... | ( | ||||
Weighted average common shares outstanding - Basic ................... | |||||
Basic earnings per common share ................................................... | $ | $ | $( | ||
Three Months Ended September 30, | |||||
2026 | 2025 | ||||
Class A | Class B | Common Stock | |||
Diluted earnings per common share: | |||||
Allocation of net income .................................................................. | $ | $ | $ | ||
Less: Deemed dividends on perpetual preferred stock .................... | ( | ( | ( | ||
Net income attributable to common shareholders ........................... | ( | ||||
Weighted average common shares outstanding - Diluted................ | |||||
Diluted earnings per common share ................................................ | $ | $ | $( | ||
Figures in the tables may not recalculate exactly due to rounding. Basic and diluted earnings per share are
calculated based on unrounded numbers.
For the three months ended September 30, 2026 and 2025, 684,419 and 37,230 , RSUs, respectively, were
excluded from the calculation of diluted earnings per share, as a result of their anti-dilutive effect. For the three
months ended September 30, 2026, 6,485,862 shares related to the IPO Founders Awards were excluded from the
calculation of diluted earnings per share as a result of their anti-dilutive effect. For the three months ended
September 30, 2025, 6,680,610 employee stock options were excluded from the calculation of diluted earnings per
share, as a result of their anti-dilutive effect. In addition, convertible preferred shares of zero and 141,989,676 ,
which are considered participating securities, were excluded from the calculation of diluted earnings per share for
the three months ended September 30, 2026 and 2025, respectively, as a result of their anti-dilutive effect.
37
EQUIPMENTSHARE.COM INC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Unaudited
Nine Months Ended September 30, | |||||
2026 | 2025 | ||||
Class A | Class B | Common Stock | |||
Basic and diluted earnings per common share: | |||||
Allocation of net income (loss) ........................................................ | $ | $ | $( | ||
Less: Deemed dividends on perpetual preferred stock .................... | ( | ( | ( | ||
Net loss attributable to common shareholders ................................. | ( | ( | ( | ||
Weighted average common shares outstanding - basic and diluted | |||||
Basic and diluted loss per common share ........................................ | $( | $( | $( | ||
Figures in the table may not recalculate exactly due to rounding. Basic and diluted earnings per share are calculated
based on unrounded numbers.
For the nine months ended September 30, 2026 and 2025, 6,796,222 and 6,843,238 employee stock options,
respectively, and 96,142 and 46,029 RSUs, respectively, were excluded from the calculation of diluted earnings per
share, as a result of their anti-dilutive effect. In addition, convertible preferred shares of 13,002,718 and
per share for the nine months ended September 30, 2026 and 2025, respectively, as a result of their anti-dilutive
effect. IPO Founders Awards of 5,891,919 were excluded from the calculation of diluted earnings per share for the
nine months ended September 30, 2026, as a result of their anti-dilutive effect.
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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
September 30, 2026, we operated 408 full-service branch locations, 9 standalone dealership sites, and 31 building
materials and hardware retail stores across 45 states, with a diversified managed fleet portfolio of more than 302,000
pieces of equipment and approximately 430,000 trackers operating on our T3 platform. As of September 30, 2026,
we had 9,734 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 September 30, 2026,
208,390 pieces of equipment were owned by us; 997 pieces of equipment were leased by us as a lessee under
operating lease arrangements with third parties such as OEMs and financial institutions; and 93,478 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, we have organized for these investors sales of large packages of
equipment and have conducted these sales on an episodic basis. Accordingly, period-over-period comparisons may
not reflect underlying trends and fluctuations in our operating results and make 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 $945 million for the three months ended September 30, 2025 to $1,468 million for
the three months ended September 30, 2026, or at a growth rate of 55.3%, and $2,808 million for the nine months
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ended September 30, 2025 to $3,905 million for the nine months ended September 30, 2026, or at a growth rate of
39%.
In line with customer demand and our growth strategy, we have increased the number of full-service equipment
rental branch locations from 342 as of September 30, 2025 to 408 as of September 30, 2026, an increase of 66 new
full-service equipment rental branch locations. In conjunction with the opening of these new full-service equipment
rental branch locations, we incurred $168 million and $186 million of new market start-up costs during the nine
months ended September 30, 2026 and 2025, respectively.
We correspondingly increased our fleet size from 235,044 units of equipment under management as of
September 30, 2025 to 302,865 as of September 30, 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 rented to our customers, from $8,053 million as
of September 30, 2025 to $10,663 million as of September 30, 2026, or an increase of 32%.
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 our customers. 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.
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 incurring additional debt. 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 $254 million and $185 million for the three
months ended September 30, 2026 and 2025, respectively, $704 million and $512 million for the nine months ended
September 30, 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 our management increased $2,610 million, or 32%, from
$8,053 million as of September 30, 2025 to $10,663 million as of September 30, 2026. The total equipment rental
fleet OEC enrolled in the OWN Program grew by $1,605 million, or 39%, Company-owned equipment rental fleet
OEC grew by $1,049 million, or 28%, and the equipment rental fleet OEC under operating leases decreased by $44
million during the same period. During the nine months ended September 30, 2026, OWN Program payouts
increased 38% compared to the nine months ended September 30, 2025; of that increase, 40% 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,
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 and 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 start-up costs are classified within
selling, general and administrative expenses.
Other Income (Expense)
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, gain on sale of properties and other assets, and
other miscellaneous income.
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Results of Operations
Three Months Ended September 30, 2026 Compared with Three Months Ended September 30, 2025
Three Months Ended September 30, | |||||||
2026 | 2025 | $ Change | % Change | ||||
($ in millions) | |||||||
Revenues | |||||||
Equipment rental and related services ................ | $985 | $672 | $313 | 47% | |||
Equipment sales .................................................. | 294 | 167 | 127 | 76% | |||
Equipment parts and supplies and services ......... | 122 | 70 | 52 | 74% | |||
Platform revenue: | |||||||
Telematics ...................................................... | 36 | 15 | 21 | 140% | |||
Other ............................................................... | 31 | 21 | 10 | 48% | |||
Total revenue .................................................... | 1,468 | 945 | 523 | 55% | |||
Cost of revenues | |||||||
Direct operating costs .......................................... | 358 | 220 | 138 | 63% | |||
OWN Program payouts ....................................... | 254 | 185 | 69 | 37% | |||
Equipment sales cost of revenues ....................... | 243 | 130 | 113 | 87% | |||
Platform expense ................................................. | 43 | 19 | 24 | 126% | |||
Depreciation and amortization ............................ | 108 | 85 | 23 | 27% | |||
Total cost of revenues ...................................... | 1,006 | 639 | 367 | 57% | |||
Gross profit ....................................................... | 462 | 306 | 156 | 51% | |||
Selling, general and administrative expenses ..... | 345 | 242 | 103 | 43% | |||
Operating income .............................................. | 117 | 64 | 53 | 83% | |||
Other income (expense): | |||||||
Interest expense ................................................... | (88) | (75) | (13) | 17% | |||
Other income, net ................................................ | 7 | 26 | (19) | (73)% | |||
Total other expense, net ................................... | (81) | (49) | (32) | 65% | |||
Income before income taxes ............................... | 36 | 15 | 21 | 140% | |||
Provision for income taxes .................................. | 16 | 9 | 7 | 78% | |||
Net income ......................................................... | $20 | $6 | $14 | 233% | |||
Total revenue. Our revenue was $1,468 million for the three months ended September 30, 2026, compared to
$945 million for the three months ended September 30, 2025, an increase of $523 million, or 55%. Our four sources
of revenues over the period are further discussed below:
Equipment rental and related services. Equipment rental and related services revenue accounted for 67% of our
revenue for the three months ended September 30, 2026, compared to 71% of our revenue for the three months
ended September 30, 2025. Our equipment rental revenue and related services was $985 million for the three months
ended September 30, 2026, compared to $672 million for the three months ended September 30, 2025, an increase of
$313 million, or 47%. Approximately $215 million of the increase in equipment rental and related services revenue
is driven by an increase in construction demand in the U.S., our strategy to increase our geographical presence, and
value afforded to our customers from our T3 platform. Accordingly, we increased the number of our full-service
equipment rental branch locations from 342 as of September 30, 2025 to 408 as of September 30, 2026. In addition,
we grew our fleet OEC under management from $8,053 million as of September 30, 2025 to $10,663 million as of
September 30, 2026, and increased the size of our fleet from 235,044 units to 302,865 units of equipment under
management as of September 30, 2025 and 2026, respectively. Changes in the mix of equipment rented and price
changes increased equipment rental and related services revenue by $98 million.
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Equipment sales. Equipment sales revenue accounted for 20% of our revenue for the three months ended
September 30, 2026, compared to 18% of our revenue for the three months ended September 30, 2025. Equipment
sales revenue was $294 million for the three months ended September 30, 2026, compared to $167 million for the
three months ended September 30, 2025, an increase of $127 million, or 76%. The change was primarily due to our
disciplined and selective equipment sales into the OWN Program, resulting in an increase of $139 million in sales of
construction equipment to existing and new participants in our OWN Program, partially offset by a decrease of $12
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 and supplies and services. Equipment parts and supplies and services revenue accounted for
8% of our revenue for the three months ended September 30, 2026, compared to 7% for the three months ended
September 30, 2025. Equipment parts and supplies and services revenue was $122 million for the three months
ended September 30, 2026, compared to $70 million for the three months ended September 30, 2025, an increase of
$52 million, or 74%. 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 342 locations as of September 30,
2025 to 408 locations as of September 30, 2026. Equipment parts and supplies and services revenue increased $31
million from mature branch locations primarily attributed to the expansion of our product and service offering in
mature branch locations, and $21 million from new branch locations open less than 24 months as a result of the
addition of 66 full-service branch locations.
Platform revenue. Platform revenue accounted for 5% of our revenue for the three months ended September 30,
2026, compared to 4% of our revenue for the three months ended September 30, 2025. Platform revenue from
telematics was $36 million for the three months ended September 30, 2026, compared to $15 million for the three
months ended September 30, 2025, an increase of $21 million or 140%. This increase was primarily due to 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 $31 million for the three months ended September 30, 2026, compared to
$21 million for the three months ended September 30, 2025, an increase of $10 million primarily attributable to the
addition of 9 building materials and hardware retail stores.
Cost of revenues. Cost of revenues was $1,006 million for the three months ended September 30, 2026,
compared to $639 million for the three months ended September 30, 2025, an increase of $367 million, or 57%. Our
sources of cost of revenues over the period are further discussed below:
Direct operating costs. Direct operating costs were $358 million for the three months ended September 30,
2026, compared to $220 million for the three months ended September 30, 2025, an increase of $138 million, or
63%. The increase in direct operating costs is primarily due to the expansion of our footprint through the addition of
66 full-service branch locations, which increased from 342 locations as of September 30, 2025 to 408 locations, and
the increase of the rental fleet under our management as of September 30, 2026. The additional operating locations
and rental fleet under our management drove increases in wages and related benefits of $23 million, and logistics,
maintenance, and other site operating costs of $117 million.
OWN Program payouts. OWN Program payouts were $254 million for the three months ended September 30,
2026 compared to $185 million for the three months ended September 30, 2025, an increase of $69 million, or 37%.
Approximately $74 million of the increase is attributed to the growth of the average fleet OEC under management
enrolled in the OWN Program, which grew from $4,037 million in 2025 to $5,636 million in 2026, or 40%. Changes
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in demand for specific types of rental equipment and the mix of equipment rented partially offset the increase in
OWN program payouts by $5 million.
Equipment sales cost of revenues. Equipment sales cost of revenues was $243 million for the three months
ended September 30, 2026, compared to $130 million for the three months ended September 30, 2025, an increase of
$113 million, or 87%. This increase was primarily due to a $124 million increase in equipment sales cost of
revenues associated with sales to existing and new participants in the OWN Program, partially offset by a $11
million decrease in equipment sales cost of revenues resulting from lower equipment sales to contractors and other
end users.
Platform expense. Platform expense was $43 million for the three months ended September 30, 2026, compared
to $19 million for the three months ended September 30, 2025, an increase of $24 million or 126%. This increase
was primarily attributed to the addition of 9 hardware retail stores and the acquisition of Morey in September 2025.
Depreciation and amortization. Depreciation and amortization accounted for 11% of our cost of revenues for
the three months ended September 30, 2026, compared to 13% of our cost of revenues for the three months ended
September 30, 2025. Depreciation and amortization was $108 million for the three months ended September 30,
2026, compared to $85 million for the three months ended September 30, 2025, an increase of $23 million, or 27%.
This increase was primarily due to a $20 million increase in depreciable equipment expense on rental equipment due
to an increase in the size of our fleet and in average cost of owned equipment in our rental equipment, and a $2
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 $345 million
for the three months ended September 30, 2026, compared to $242 million for the three months ended September
30, 2025, an increase of $103 million, or 43%. 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 545 additional staff resulting in an increase of $36 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 $13 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 $9 million and other miscellaneous administrative
expenses by $19 million. Additionally, increased stock-based compensation expense of $26 million was recorded
primarily for the IPO Founders Awards for the three months ended September 30, 2026.
Interest expense. Interest expense was $88 million for the three months ended September 30, 2026, compared to
$75 million for the three months ended September 30, 2025, an increase of $13 million, or 17%. 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 $81 million for the three months ended September 30,
2026, compared to $49 million for the three months ended September 30, 2025. The increase in interest expense of
$13 million for the three months ended September 30, 2026, compared to the three months ended September 30,
2025, was the result of our higher average outstanding borrowing for the three months ended September 30, 2026,
and as a result of lower miscellaneous income of $19 million due to higher realized and unrealized net gains on
investments in the prior year.
Provision for income taxes. The provision for income taxes was $16 million for the three months ended
September 30, 2026, compared to a provision for income taxes of $9 million for the three months ended September
30, 2025, an increase in income tax expense of $7 million, or 78%. The change in income tax expense is primarily
due to an increase in operating income to $117 million for the three months ended September 30, 2026, as compared
to operating income of $64 million for the three months ended September 30, 2025, applying the estimated annual
effective tax rate for each period that reflects the expected full-year income and related tax expense. Differences
between applicable federal and state statutory tax rates and the effective income tax rates for the income tax
provision recorded by us are primarily due to the Section 162(m) limitation and other nondeductible expenses,
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discrete excess tax benefits from stock-based compensation, and the Texas franchise tax, offset by research and
development tax credits.
Net Income. Net income increased by $14 million to $20 million for the three months ended September 30,
2026, as compared to net income of $6 million for the three months ended September 30, 2025, due to $53 million
of higher operating income, partially offset by $32 million of higher total other expense, net and $7 million of higher
income tax provision.
Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025
Nine Months Ended September 30, | |||||||
2026 | 2025 | $ Change | % Change | ||||
($ in millions) | |||||||
Revenues | |||||||
Equipment rental and related services ................ | $2,483 | $1,744 | $739 | 42% | |||
Equipment sales .................................................. | 955 | 790 | 165 | 21% | |||
Equipment parts and supplies and services ......... | 287 | 198 | 89 | 45% | |||
Platform revenue: | |||||||
Telematics ...................................................... | 101 | 35 | 66 | 189% | |||
Other ............................................................... | 79 | 41 | 38 | 93% | |||
Total revenue .................................................... | 3,905 | 2,808 | 1,097 | 39% | |||
Cost of revenues | |||||||
Direct operating costs .......................................... | 856 | 572 | 284 | 50% | |||
OWN Program payouts ....................................... | 704 | 512 | 192 | 38% | |||
Equipment sales cost of revenues ....................... | 783 | 654 | 129 | 20% | |||
Platform expense ................................................. | 106 | 38 | 68 | 179% | |||
Depreciation and amortization ............................ | 296 | 233 | 63 | 27% | |||
Total cost of revenues ...................................... | 2,745 | 2,009 | 736 | 37% | |||
Gross profit ....................................................... | 1,160 | 799 | 361 | 45% | |||
Selling, general and administrative expenses ..... | 948 | 680 | 268 | 39% | |||
Operating income .............................................. | 212 | 119 | 93 | 78% | |||
Other income (expense): | |||||||
Interest expense ................................................... | (231) | (207) | (24) | 12% | |||
Other income, net ................................................ | 27 | 40 | (13) | (33)% | |||
Total other expense, net ................................... | (204) | (167) | (37) | 22% | |||
Income (loss) before income taxes ...................... | 8 | (48) | 56 | (117)% | |||
Benefit from income taxes .................................. | (2) | (23) | 21 | (91)% | |||
Net income (loss) ................................................ | $10 | $(25) | $35 | (140)% | |||
Total revenue. Our revenue was $3,905 million for the nine months ended September 30, 2026, compared to
$2,808 million for the nine months ended September 30, 2025, an increase of $1,097 million, or 39%. Our four
sources of revenues over the period are further discussed below:
Equipment rental and related services. Equipment rental and related services revenue accounted for 64% of our
revenue for the nine months ended September 30, 2026, compared to 62% of our revenue for the nine months ended
September 30, 2025. Our equipment rental and related services revenue was $2,483 million for the nine months
ended September 30, 2026, compared to $1,744 million for the nine months ended September 30, 2025, an increase
of $739 million, or 42%. Approximately $558 million of the increase in equipment rental and related services
revenue 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 platform. Accordingly, we increased the number of our full-
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service equipment rental branch locations from 342 as of September 30, 2025 to 408 as of September 30, 2026. In
addition, we grew our rental fleet OEC under management from $8,053 million as of September 30, 2025 to $10,663
million as of September 30, 2026, and increased the size of our rental fleet from 235,044 units to 302,865 units of
equipment under management as of September 30, 2025 and 2026, respectively. Changes in the mix of equipment
rented and price changes increased equipment rental and related services revenue by $181 million.
Equipment sales. Equipment sales revenue accounted for 24% of our revenue for the nine months ended
September 30, 2026, compared to 28% of our revenue for the nine months ended September 30, 2025. Equipment
sales revenue was $955 million for the nine months ended September 30, 2026, compared to $790 million for the
nine months ended September 30, 2025, an increase of $165 million, or 21%. The change was primarily due to an
increase of $158 million in sales of construction equipment to existing and new participants in our OWN Program,
including third parties who have financed equipment purchases through the issuance of ABS, and an increase of $7
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 and supplies and services. Equipment parts and supplies and services revenue accounted for
7% of our revenue for the nine months ended September 30, 2026, compared to 7% for the nine months ended
September 30, 2025. Equipment parts and supplies and services revenue was $287 million for the nine months ended
September 30, 2026, compared to $198 million for the nine months ended September 30, 2025, an increase of $89
million, or 45%. 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 342 locations as of September 30,
2025 to 408 locations as of September 30, 2026. Equipment parts and supplies and services revenue increased $47
million from mature branch locations primarily attributed to the expansion of our product and service offering in
mature branch locations, and $42 million from new branch locations open less than 24 months as a result of the
addition of 66 full-service branch locations.
Platform revenue. Platform revenue accounted for 5% of our revenue for the nine months ended September 30,
2026, compared to 3% of our revenue for the nine months ended September 30, 2025. Platform revenue from
telematics was $101 million for the nine months ended September 30, 2026, compared to $35 million for the nine
months ended September 30, 2025, an increase of $66 million, or 189%. This increase was primarily due to an
increase in revenues related to the sale of custom electronic components following our September 2025 acquisition
of the controlling interests in 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
$79 million for the nine months ended September 30, 2026, compared to $41 million for the nine months ended
September 30, 2025, an increase of $38 million primarily attributable to the addition of 9 building materials and
hardware retail stores.
Cost of revenues. Cost of revenues was $2,745 million for the nine months ended September 30, 2026,
compared to $2,009 million for the nine months ended September 30, 2025, an increase of $736 million, or 37%.
Direct operating costs. Direct operating costs were $856 million for the nine months ended September 30, 2026,
compared to $572 million for the nine months ended September 30, 2025, an increase of $284 million, or 50%. The
increase in direct operating costs is primarily due to the expansion of our footprint through the addition of 66 full-
service branch locations, which increased from 342 locations as of September 30, 2025 to 408 locations, and the
increase of the rental fleet under our management as of September 30, 2026. The additional operating locations and
rental fleet under our management drove increases in wages and related benefits of $67 million, and logistics,
maintenance, and other site operating costs of $218 million.
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OWN Program payouts. OWN Program payouts were $704 million for the nine months ended September 30,
2026 compared to $512 million for the nine months ended September 30, 2025, an increase of $192 million, or 38%.
Approximately $205 million of the increase is attributed to the growth of the average fleet OEC under management
enrolled in the OWN Program, which grew from $3,766 million in 2025 to $5,285 million in 2026, or 40%. Changes
in demand for specific types of rental equipment and the mix of equipment rented partially offset the increase in
OWN program payouts by $13 million.
Equipment sales cost of revenues. Equipment sales cost of revenues was $783 million for the nine months ended
September 30, 2026, compared to $654 million for the nine months ended September 30, 2025, an increase of $129
million, or 20%. This increase was primarily due to an increase of $119 million in equipment sales cost of revenues
for sales to existing and new participants in the OWN Program and $10 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 342 as of September 30, 2025 to 408 as of September 30, 2026.
Platform expense. Platform expense was $106 million for the nine months ended September 30, 2026,
compared to $38 million for the nine months ended September 30, 2025, an increase of $68 million or 179%. This
increase was primarily attributed to the addition of 9 hardware retail stores and the acquisition of Morey in
September 2025.
Depreciation and amortization. Depreciation and amortization accounted for 11% of our cost of revenues for
the nine months ended September 30, 2026, compared to 12% of our cost of revenues for the nine months ended
September 30, 2025. Depreciation and amortization was $296 million for the nine months ended September 30,
2026, compared to $233 million for the nine months ended September 30, 2025, an increase of $63 million, or 27%.
This increase was primarily due to a $54 million increase in depreciable equipment expense on rental equipment due
to an increase in the size of our fleet and in average cost of owned equipment in our rental equipment, and a $7
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 $948 million
for the nine months ended September 30, 2026, compared to $680 million for the nine months ended September 30,
2025, an increase of $268 million, or 39%. 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 approximately 2,034 additional staff resulting in an increase of $97 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 $35 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 $19 million and other miscellaneous
administrative expenses by $49 million. Additionally, increased stock-based compensation expense of $68 million
was recorded primarily for the IPO Founders Awards for the nine months ended September 30, 2026.
Interest expense. Interest expense was $231 million for the nine months ended September 30, 2026, compared
to $207 million for the nine months ended September 30, 2025, an increase of $24 million, or 12%. 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 $204 million for the nine months ended September 30,
2026, compared to $167 million for the nine months ended September 30, 2025, an increase of $37 million, or 22%.
This increase was primarily due to higher interest expense of $24 million for the nine months ended September 30,
2026, compared to the nine months ended September 30, 2025, resulting from our higher average outstanding
borrowing for the nine months ended September 30, 2026, and as a result of lower miscellaneous income of $13
million due to higher realized and unrealized net gains on investments in the prior year.
Benefit from income taxes. The benefit from income taxes was $2 million for the nine months ended September
30, 2026, compared to $23 million for the nine months ended September 30, 2025, a decrease of $21 million, or
91%. The change in the benefit from income taxes is primarily due to an increase in operating income to $212
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million for the nine months ended September 30, 2026, as compared to operating income of $119 million for the
nine months ended September 30, 2025, applying the estimated annual effective tax rate for each period that reflects
the expected full-year income and related tax expense, partially offset by discrete excess tax benefits from stock-
based compensation. Differences between applicable federal and state statutory tax rates and the effective income
tax rates for the income tax benefit recorded by us are primarily due to the Section 162(m) limitation and other
nondeductible expenses, discrete excess tax benefits from stock-based compensation, and the Texas franchise tax,
offset by research and development tax credits.
Net income (loss). Net income increased by $35 million to a net income of $10 million for the nine months
ended September 30, 2026, as compared to net loss of $25 million for the nine months ended September 30, 2025,
due to $93 million of higher operating income, partially offset by $37 million of higher total other expense, net and
$21 million of lower 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.
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The table below reconciles net income to EBITDA for each of the periods indicated:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
(In millions) | |||||||
Net income (loss) .............................. | $20 | $6 | $10 | $(25) | |||
Provision for (benefit from) income taxes .................................................. | 16 | 9 | (2) | (23) | |||
Depreciation and amortization expense .............................................. | 125 | 95 | 341 | 261 | |||
Interest expense ................................. | 88 | 75 | 231 | 207 | |||
Non-cash stock compensation expense(1) ........................................... | 27 | 1 | 71 | 3 | |||
EBITDA .......................................... | $276 | $186 | $651 | $423 | |||
__________________
(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 ASC Topic 280, Segment Reporting. Equipment Rental Segment Adjusted EBITDA
Margin is Equipment Rental Segment Adjusted EBITDA divided by Equipment Rental and Services Operations
Segment total revenues.
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 September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
(In millions) | |||||||
Equipment Rental Segment Adjusted EBITDA(1) ............ | $491 | $324 | $1,204 | $807 | |||
Equipment Rental Segment Adjusted EBITDA Margin .............................. | 44% | 43% | 43% | 41% | |||
__________________
(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 $7 million for the three months ended September 30, 2026 and 2025, respectively,
and $18 million and $19 million for the nine months ended September 30, 2026 and 2025, respectively. Depreciation expense related to our
property and other fixed assets was $16 million and $11 million for the three months ended September 30, 2026 and 2025, respectively, and
$43 million and $29 million for the nine months ended September 30, 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. OWN Program payouts, depreciation expense on rental equipment, and amortization
expense on capitalized software and intangible assets was $254 million, $100 million, and $9 million, respectively, for the three months
ended September 30, 2026, and $704 million, $272 million, and $26 million, respectively, for the nine months ended September 30, 2026,
and $185 million, $79 million, and $6 million, respectively, for the three months ended September 30, 2025, and $512 million, $218
million, and $14 million, respectively, for the nine months ended September 30, 2025. For additional information, see Note 18. Segment
Information in this Form 10-Q, for the three and nine months ended September 30, 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 September 30, 2026 and September 30,
2025 was $4,816 million and $3,767 million, respectively, or approximately 45% and 47%, respectively, of total
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equipment rental OEC under our management. At September 30, 2026, the appraised value of the rental equipment
owned by OWN Program participants was $4,213 million. Our broader managed equipment rental fleet from which
we support and generate our equipment rental revenue as of September 30, 2026 consisted of 302,865 units having
an OEC of $10,663 million and an average age of 31 months, and as of September 30, 2025 consisted of 235,044
units having an OEC of $8,053 million and an average age of 30 months.
Fleet Composition. Our equipment rental fleet from which we support and generate our equipment rental
revenue is summarized in the tables below:
September 30, 2026 | |||||||
% of | OEC | % of | |||||
Units | Total | (In millions) | Total | ||||
EquipmentShare Owned ............................... | 208,390 | 69% | $4,816 | 45% | |||
OWN Program .............................................. | 93,478 | 31% | 5,765 | 54% | |||
Operating Lease ............................................ | 997 | —% | 82 | 1% | |||
Total ............................................................ | 302,865 | 100% | $10,663 | 100% | |||
September 30, 2025 | |||||||
% of | OEC | % of | |||||
Units | Total | (In millions) | Total | ||||
EquipmentShare Owned ............................... | 164,168 | 70% | $3,767 | 47% | |||
OWN Program .............................................. | 69,337 | 29% | 4,160 | 52% | |||
Operating Lease ............................................ | 1,539 | 1% | 126 | 1% | |||
Total ............................................................ | 235,044 | 100% | $8,053 | 100% | |||
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 September 30, 2026 and December 31, 2025, 83% 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 17% and 15% of our rental
fleet consists of specialty equipment, which includes advanced solutions, industrial tooling, and other non-core
rental equipment, respectively.
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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. Rental Equipment, Net in this Form 10-Q, for the
nine months ended September 30, 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. Segment Information in
this Form 10-Q, for the three and nine months ended September 30, 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, and (ii) equipment that is leased to us
under month-to-month or longer-term arrangements from participants in our OWN Program. We generate rental
revenue by renting equipment owned by us or owned by others and re-renting the equipment to our customers.
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 408 full-service branch locations and 9 dealership sites
as of September 30, 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.
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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.”
The following tables present information about our reportable segments for the three months ended September
30, 2026 and 2025 (in millions):
Three Months Ended September 30, 2026 | |||||||
Equipment Rental and Services Operations | Equipment Sales | All Other | Total | ||||
Equipment rental, parts, supplies, and services ........... | $1,107 | $— | $— | $1,107 | |||
Equipment sales ........................................................... | — | 294 | — | 294 | |||
Telematics ................................................................... | 6 | — | 30 | 36 | |||
Sales of building materials, small tools, and hardware supplies .................................................... | — | — | 31 | 31 | |||
Total revenues ........................................................... | $1,113 | $294 | $61 | $1,468 | |||
Significant expenses: | |||||||
Segment cost of revenues ....................................... | 352 | 243 | 43 | ||||
Segment selling, general and administrative expenses .............................................................. | 270 | 7 | 24 | ||||
Segment Adjusted EBITDA(1) ................................. | $491 | $44 | $(6) | ||||
Three Months Ended September 30, 2025 | |||||||
Equipment Rental and Services Operations | Equipment Sales | All Other | Total | ||||
Equipment rental, parts, supplies, and services ........... | $742 | $— | $— | $742 | |||
Equipment sales ........................................................... | — | 167 | — | 167 | |||
Telematics ................................................................... | 4 | — | 11 | 15 | |||
Sales of building materials, small tools, and hardware supplies .................................................... | — | — | 21 | 21 | |||
Total revenues ............................................................ | $746 | $167 | $32 | $945 | |||
Significant expenses: ................................................... | |||||||
Segment cost of revenues ....................................... | 213 | 130 | 19 | ||||
Segment selling, general and administrative expenses .............................................................. | 209 | 7 | 15 | ||||
Segment Adjusted EBITDA(1) .................................. | $324 | $30 | $(2) | ||||
__________________
(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 $7 million for the three months ended September 30, 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 $254 million, $100 million, and $9 million, respectively, for the three months ended September 30, 2026, $185
million, $79 million, and $6 million, respectively, for the three months ended September 30, 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
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property and other fixed assets was $16 million and $11 million for the three months ended September 30, 2026 and 2025, respectively. For
additional information, see Note 18. Segment Information in this Form 10-Q, for the three and nine months ended September 30, 2026.
Three Months Ended September 30, 2026 Compared with Three Months Ended September 30, 2025
Equipment Rental and Services Operations. Revenue for our Equipment Rental and Services Operations
segment was $1,113 million for the three months ended September 30, 2026, compared to $746 million for the three
months ended September 30, 2025, an increase of $367 million, or 49%. Approximately $215 million of the increase
is attributed to the growth in fleet OEC under our management from $8,053 million as of September 30, 2025 to
$10,663 million as of September 30, 2026, and the corresponding increase in our fleet size from 235,044 units to
302,865 units of equipment under our management as of September 30, 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 342 as of September 30, 2025, to 408 as of
September 30, 2026. Revenue from sales of equipment parts and supplies and services from mature branch locations
and new branch locations open less than 24 months contributed $31 million and $21 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 $98 million.
Segment Adjusted EBITDA for our Equipment Rental and Services Operations segment was $491 million for
the three months ended September 30, 2026, compared to $324 million for the three months ended September 30,
2025, an increase of $167 million, or 52%. The increase in Segment Adjusted EBITDA was primarily due to an
increase in segment total revenues of $367 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 $8,053 million as of
September 30, 2025 to $10,663 million as of September 30, 2026, and the corresponding increase in our fleet size
from 235,044 units to 302,865 units of equipment under our management as of September 30, 2025 and 2026,
respectively, driven by OWN Program demand. The increase in segment total revenues was offset by increases of
$139 million in segment cost of revenues and $61 million in segment selling, general and administrative expenses.
Equipment Sales. Revenue for our Equipment Sales segment was $294 million for the three months ended
September 30, 2026, compared to $167 million for the three months ended September 30, 2025, an increase of $127
million, or 76%. The increase was primarily due to increased sales of construction equipment, primarily to existing
and new participants in the OWN Program, as presented in the following table (in millions):
Three Months Ended September 30, | |||||||
2026 | 2025 | $ Change | % Change | ||||
Equipment sales to OWN Program participants(1) ....... | $243 | $104 | $139 | 134% | |||
Other new equipment sales .......................................... | 27 | 44 | (17) | (39)% | |||
Other used equipment sales ......................................... | 24 | 19 | 5 | 26% | |||
Total revenues - equipment sales ............................. | $294 | $167 | $127 | 76% | |||
Cost of equipment sold to OWN Program participants ............................................................... | $201 | $77 | $124 | 161% | |||
Cost of other new equipment sales .............................. | 24 | 36 | (12) | (33)% | |||
Cost of other used equipment sales ............................. | 18 | 17 | 1 | 6% | |||
Total cost of revenues - equipment sales ................. | $243 | $130 | $113 | 87% | |||
__________________
(1)For the three months ended September 30, 2026 and 2025, equipment sales to OWN Program participants included net revenue of $9
million and $15 million, respectively, recognized on an agent basis, with overall transaction values of $62 million and $118 million,
respectively.
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The increase in equipment sales of $127 million is primarily attributed to higher sales of $139 million in
construction equipment to existing and new participants in our OWN Program. Sales of new equipment from our full
service branch locations to contractors and other end users decreased by $17 million.
Segment Adjusted EBITDA for our Equipment Sales segment was $44 million for the three months ended
September 30, 2026, compared to $30 million for the three months ended September 30, 2025, an increase of $14
million, or 47%. The increase in Segment Adjusted EBITDA for Equipment Sales was primarily due to an increase
in segment total revenues of $127 million offset by increases of $113 million in segment cost of revenues.
All Other. Revenue for all other activities was $61 million for the three months ended September 30, 2026,
compared to $32 million for the three months ended September 30, 2025, an increase of $29 million, or 91%. This
increase was primarily due to an increase of $19 million in revenues related to the sale of custom electronic
components following our September 2025 acquisition of the controlling interest in Morey, a business that designs,
manufactures, and sells custom electronic components, including telematics tracker devices and cloud-based access
control keypads, as well as an increase of $10 million in sales of building materials, small tools, and hardware
supplies due to our expansion of 9 hardware stores during the trailing twelve months. Segment loss for our all other
activities was $6 million for the three months ended September 30, 2026, compared to Segment loss of $2 million
for the three months ended September 30, 2025, an increase of $4 million, or 200%, primarily due to 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, partially offset by the higher revenue previously discussed.
The following tables present information about our reportable segments for the nine months ended September
30, 2026 and 2025 (in millions):
Nine Months Ended September 30, 2026 | |||||||
Equipment Rental and Services Operations | Equipment Sales | All Other | Total | ||||
Equipment rental, parts, supplies, and services ........... | $2,770 | $— | $— | $2,770 | |||
Equipment sales ........................................................... | — | 955 | — | 955 | |||
Telematics ................................................................... | 15 | — | 86 | 101 | |||
Sales of building materials, small tools, and hardware supplies .................................................... | — | — | 79 | 79 | |||
Total revenues ........................................................... | $2,785 | $955 | $165 | $3,905 | |||
Significant expenses: | |||||||
Segment cost of revenues ....................................... | 838 | 783 | 106 | ||||
Segment selling, general and administrative expenses .............................................................. | 743 | 22 | 67 | ||||
Segment Adjusted EBITDA(1) ................................. | $1,204 | $150 | $(8) | ||||
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Nine Months Ended September 30, 2025 | |||||||
Equipment Rental and Services Operations | Equipment Sales | All Other | Total | ||||
Equipment rental, parts, supplies, and services ........... | $1,942 | $— | $— | $1,942 | |||
Equipment sales ........................................................... | — | 790 | — | 790 | |||
Telematics ................................................................... | 11 | — | 24 | 35 | |||
Sales of building materials, small tools, and hardware supplies .................................................... | — | — | 41 | 41 | |||
Total revenues ............................................................ | $1,953 | $790 | $65 | $2,808 | |||
Significant expenses: ................................................... | |||||||
Segment cost of revenues ....................................... | 554 | 654 | 38 | ||||
Segment selling, general and administrative expenses .............................................................. | 592 | 21 | 38 | ||||
Segment Adjusted EBITDA(1) .................................. | $807 | $115 | $(11) | ||||
__________________
(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 $18 million and $19 million for the nine months ended September 30, 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. OWN Program payouts,
depreciation expense on rental equipment, and amortization expense on capitalized software and intangible assets was $704 million, $272
million, and $26 million, respectively, for the nine months ended September 30, 2026, $512 million, $218 million, and $14 million,
respectively, for the nine months ended September 30, 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
$43 million and $29 million for the nine months ended September 30, 2026 and 2025, respectively. For additional information, see Note 18.
Segment Information in this Form 10-Q, for the nine months ended September 30, 2026.
Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025
Equipment Rental and Services Operations. Revenue for our Equipment Rental and Services Operations
segment was $2,785 million for the nine months ended September 30, 2026, compared to $1,953 million for the nine
months ended September 30, 2025, an increase of $832 million, or 43%. Approximately $558 million of the increase
is attributed to the growth in fleet OEC under our management from $8,053 million as of September 30, 2025 to
$10,663 million as of September 30, 2026, and the corresponding increase in our fleet size from 235,044 units to
302,865 units of equipment under our management as of September 30, 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 342 as of September 30, 2025, to 408 as of
September 30, 2026. Revenue from sales of equipment parts and supplies and services from mature branch locations
and new branch locations open less than 24 months contributed $47 million and $42 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 $181 million.
Segment Adjusted EBITDA for our Equipment Rental and Services Operations segment was $1,204 million for
the nine months ended September 30, 2026, compared to $807 million for the nine months ended September 30,
2025, an increase of $397 million, or 49%. The increase in Segment Adjusted EBITDA was primarily due to an
increase in segment total revenues of $832 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 $8,053 million as of
September 30, 2025 to $10,663 million as of September 30, 2026, and the corresponding increase in our fleet size
from 235,044 units to 302,865 units of equipment under our management as of September 30, 2025 and 2026,
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respectively, driven by OWN Program demand. The increase in segment total revenues was offset by increases of
$284 million in segment cost of revenues and $151 million in segment selling, general and administrative expenses.
Equipment Sales. Revenue for our Equipment Sales segment was $955 million for the nine months ended
September 30, 2026, compared to $790 million for the nine months ended September 30, 2025, an increase of $165
million, or 21%. The increase was primarily due to increased sales of construction equipment, primarily to existing
and new participants in the OWN Program, as presented in the following table (in millions):
Nine Months Ended September 30, | |||||||
2026 | 2025 | $ Change | % Change | ||||
Equipment sales to OWN Program participants(1) ....... | $773 | $615 | $158 | 26% | |||
Other new equipment sales .......................................... | 76 | 90 | (14) | (16)% | |||
Other used equipment sales ......................................... | 106 | 85 | 21 | 25% | |||
Total revenues - equipment sales ............................. | $955 | $790 | $165 | 21% | |||
Cost of equipment sold to OWN Program participants ............................................................... | $628 | $509 | $119 | 23% | |||
Cost of other new equipment sales .............................. | 69 | 77 | (8) | (10)% | |||
Cost of other used equipment sales ............................. | 86 | 68 | 18 | 26% | |||
Total cost of revenues - equipment sales ................. | $783 | $654 | $129 | 20% | |||
__________________
(1)For the nine months ended September 30, 2026 and 2025, equipment sales to OWN Program participants included net revenue of $47
million and $45 million, respectively, recognized on an agent basis, with overall transaction values of $298 million and $358 million,
respectively.
The increase in equipment sales of $165 million is primarily attributed to higher sales of $158 million in
construction equipment to existing and new participants in our OWN Program. Sales of used equipment from our
full service branch locations to contractors and other end users increased $21 million, primarily attributed to our site
expansions.
Segment Adjusted EBITDA for our Equipment Sales segment was $150 million for the nine months ended
September 30, 2026, compared to $115 million for the nine months ended September 30, 2025, an increase of $35
million, or 30%. The increase in Segment Adjusted EBITDA for Equipment Sales was primarily attributed to higher
gross margins on equipment sales.
All Other. Revenue for all other activities was $165 million for the nine months ended September 30, 2026,
compared to $65 million for the nine months ended September 30, 2025, an increase of $100 million, or 154%. This
increase was primarily due to an increase of $62 million in revenues related to the sale of custom electronic
components following our September 2025 acquisition of the controlling interest in Morey, a business that designs,
manufactures, and sells custom electronic components, including telematics tracker devices and cloud-based access
control keypads, as well as an increase of $38 million in sales of building materials, small tools, and hardware
supplies due to our expansion of 9 hardware stores during the trailing twelve months. Segment loss for our all other
activities was $8 million for the nine months ended September 30, 2026, compared to $11 million for the nine
months ended September 30, 2025, a decrease of $3 million, or 27%, primarily due to the higher revenue as
previously discussed, partially offset by an increase of $29 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, share repurchases, and funding acquisitions.
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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 asset-based lending facility (the “ABL Credit Facility”), other financing
arrangements, including lines of credit, and the issuances of perpetual preferred, common stock, and convertible
preferred stock, as well as debt securities.
As of September 30, 2026, our liquidity consisted of cash and cash equivalents of $359 million and net excess
availability of $1,939 million under our ABL Credit Facility. See “—ABL Credit Facility—Borrowing Capacity”
below.
On July 1, 2026, we issued $1,350 million in an aggregate principal amount of 7.125% Senior Secured Second
Lien Notes due 2034 (defined below) and used proceeds primarily to repay outstanding borrowings under the ABL
Credit Facility, enhancing our liquidity.
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 some of which 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.
On July 9, 2026, the Board approved a share repurchase program with authorization to purchase up to an
aggregate of $500 million of our Class A common stock with an expiration date of December 31, 2028. Repurchases
under the program may be made from time to time in the open market at prevailing market prices, in privately
negotiated transactions, in block trades and through other legally permissible means, with the amount and timing of
repurchases to be determined at our discretion, depending on market conditions and corporate needs. This program
does not obligate us to acquire any particular amount of Class A common stock and may be modified, suspended or
terminated at any time at the discretion of the Board. As of September 30, 2026, no shares had been repurchased
under this authorization.
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
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.
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The following table summarizes the change in cash and cash equivalents for the periods shown:
Nine Months Ended September 30, | |||
2026 | 2025 | ||
(In millions) | |||
Net cash used in operating activities .............................................. | $(179) | $(14) | |
Net cash used in investing activities ............................................... | (1,357) | (978) | |
Net cash provided by financing activities ...................................... | 1,589 | 987 | |
Net increase (decrease) in cash and cash equivalents .............. | $53 | $(5) | |
Net Cash Used in Operating Activities
For the nine months ended September 30, 2026 and 2025, net cash used in our operating activities was $179
million and $14 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. Net cash
used in operating activities also reflects an increase in cost of revenues of $736 million, selling, general and
administrative expenses of $268 million, and interest expense of $24 million for the nine months ended September
30, 2026, as compared to the nine months ended September 30, 2025, associated with the growth of our revenues
and other changes in working capital.
Net Cash Used in Investing Activities
For the nine months ended September 30, 2026 and 2025, net cash used in our investing activities was $1,357
million and $978 million, respectively, an increase of 39%, and was primarily due to an increase in cash used for the
purchases of rental equipment, which was $1,839 million for the nine months ended September 30, 2026, and $1,297
million for the nine months ended September 30, 2025 and an increase in cash used for the purchases of investments
in equity and debt securities which was $55 million for the nine months ended September 30, 2026, and $27 million
for the nine months ended September 30, 2025.
Net Cash Provided by Financing Activities
For the nine months ended September 30, 2026, net cash provided by financing activities was $1,589 million,
compared to $987 million for the nine months ended September 30, 2025, an increase of 61%. Net cash provided by
financing activities was positively impacted by net proceeds of $3,767 million from the issuance of long-term debt
for the nine months ended September 30, 2026, and net proceeds of $1,365 million from the issuance of long-term
debt for the nine months ended September 30, 2025, and proceeds of $706 million from the issuance of Class A
common stock upon the initial public offering, net of underwriting discount and commissions for the nine months
ended September 30, 2026. This was offset partially by using $2,810 million in cash to repay long-term debt for the
nine months ended September 30, 2026 and $315 million in cash to repay long-term debt for the nine months ended
September 30, 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 and family offices who have financed
equipment purchases through the issuance of ABS.
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 periods presented.
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Nine Months Ended September 30, | |||
2026 | 2025 | ||
(In millions) | |||
Purchases of rental equipment ........................................................... | $1,839 | $1,297 | |
Proceeds from sale of rental equipment(1) .......................................... | (715) | (604) | |
Net rental equipment capital expenditure .................................... | $1,124 | $693 | |
Investments in internally developed software(2) ................................. | 25 | 30 | |
Net rental equipment & software expenditure ............................. | $1,149 | $723 | |
__________________
(1)Proceeds from sale of rental equipment reported as investing activities within the consolidated statements of cash flows exclude (i) gross
profit on such sales of equipment of $125 million and $91 million for the nine months ended September 30, 2026 and 2025, respectively;
(ii) other new equipment sales of $74 million and $73 million for the nine months ended September 30, 2026 and 2025, respectively; (iii)
net revenue from equipment sold on an agent basis of $47 million and $45 million for the nine months ended September 30, 2026 and 2025,
respectively; and (iv) offset by changes in accounts receivable and other of $6 million and $23 million for the nine months ended September
30, 2026 and 2025, respectively.
(2)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 $1,124 million for the nine months ended September 30, 2026,
compared to $693 million for the nine months ended September 30, 2025, an increase of 62%, 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, we refinanced existing borrowings under an asset-based lending facility (the “ABL
Facility”) by entering into 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 our 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 September 30, 2026, we calculated a Borrowing Base, as defined under the ABL Credit Facility, of
$2,750 million. We determine “Net Excess Availability” as the amount of additional debt we could borrow based on
the existing borrowing base. As of September 30, 2026, we had Net Excess Availability of $1,939 million under the
ABL Credit Facility. We determine “Remaining Capacity” as defined under the ABL Credit Facility as the
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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
September 30, 2026, we calculated Remaining Capacity of $1,939 million and our “Availability Under Borrowing
Base Limitation” was $1,664 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 September 30, 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 September 30, 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. Long-Term Debt and Lines of Credit 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 and nine months ended September 30, 2026, new
market start-up costs attributed to our Equipment Rental and Services Operations segment were $59 million and
$168 million, respectively. For the three and nine months ended September 30, 2025, new market start-up costs
attributed to our Equipment Rental and Services Operations segment were $70 million and $186 million,
respectively.
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), our 2033
Notes (as defined below) and our 2034 Notes (as defined below).
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),
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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, our 2033 Notes (as defined below) and our
2034 Notes (as defined below).
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, our 2032 Notes and our
2034 Notes (as defined below).
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.
Senior Secured Second Lien Notes due 2034
On July 1, 2026, we issued $1,350,000,000 in aggregate principal amount of 7.125% Senior Secured Second
Lien Notes due 2034 (the “2034 Notes”). The 2034 Notes were issued pursuant to the indenture, dated as of July 1,
2026, between us and Citibank, N.A., as trustee and notes collateral agent (the “2034 Notes Indenture”). The 2034
Notes bear interest at a rate of 7.125% per year and interest on the 2034 Notes is payable semi-annually in arrears on
July 1 and January 1 of each year. The 2034 Notes will mature on July 1, 2034. The 2034 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, our 2032 Notes and our 2033 Notes.
The 2034 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 2034 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 2034 Notes at the redemption prices set forth in the 2034 Notes Indenture.
The 2034 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
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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 2034
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 2034 Notes Indenture has occurred and is
continuing. In the case of an event of default, the principal amount of the 2034 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.
Share Repurchase Program
On July 9, 2026, the Board approved a share repurchase program with authorization to purchase up to an
aggregate of $500 million of our Class A common stock with an expiration date of December 31, 2028.
Repurchases under the program may be made from time to time in the open market at prevailing market prices,
in privately negotiated transactions, in block trades and through other legally permissible means, with the amount
and timing of repurchases to be determined at our discretion, depending on market conditions and corporate needs.
Open market repurchases will be structured to occur in accordance with applicable federal securities laws, including
within the pricing and volume requirements of Rule 10b-18 under the Exchange Act. We may also, from time to
time, enter into Rule 10b5-1 plans to facilitate repurchases of our shares under this authorization. This program does
not obligate us to acquire any particular amount of Class A common stock and may be modified, suspended or
terminated at any time at the discretion of the Board. As of September 30, 2026, no shares had been repurchased
under this authorization.
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
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. On June 7, 2026, the Board declared a
dividend to the holders of perpetual preferred stock in an aggregate amount of $37 million payable in cash. The
dividend was paid on June 26, 2026. As of September 30, 2026, the maximum potential dividend accumulated in
arrears on our perpetual preferred was approximately $150 million.
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Contractual Obligations and Commitments
The following table summarizes our long-term contractual obligations and commitments as of September 30,
2026.
Payments Due by Period | |||||||||
Total | Less than 1 year | 1 - 3 years | 3 - 5 years | More than 5 years | |||||
(In millions) | |||||||||
Debt ............................................................... | $4,292 | $2 | $1,035 | $806 | $2,449 | ||||
Operating leases ............................................ | 1,126 | 83 | 218 | 243 | 582 | ||||
Finance leases ............................................... | 365 | 19 | 58 | 61 | 227 | ||||
Financing obligations (equipment) ............... | 20 | 1 | 6 | 13 | – | ||||
Total contractual obligations .................... | $5,803 | $105 | $1,317 | $1,123 | $3,258 | ||||
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 2025 Form 10-K. There have been no material changes to our
critical accounting policies and estimates during the nine months ended September 30, 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 Credit Facility as of September 30, 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
have resulted in a change to cost of revenues of approximately $16 million and $11 million for the nine months
ended September 30, 2026 and 2025, respectively.
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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 nine months ended
September 30, 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 September 30, 2026.
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting during the fiscal quarter ended
September 30, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
A description of legal proceedings can be found in Note 17. Commitments and Contingencies in this Form 10-
Q, which is incorporated by reference in answer to this item.
Item 1A. Risk Factors.
Part I, Item 1A. “Risk Factors” in our 2025 Form 10-K includes a discussion of our risk factors and Part II, Item
1A. “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 (the “Q2 2026 Form
10-Q”) added to the risk factors described in our 2025 Form 10-K. Other than the risk factor below, there have been
no material changes from the risk factors described in our 2025 Form 10-K and our Q2 2026 Form 10-Q. We may
disclose changes to such risk factors or disclose additional risk factors from time to time in our SEC filings.
We have become subject to, and may in the future be subject to, short selling strategies driving down the market
price of our Class A common stock and increasing the volatility of the trading market for our Class A common
stock, as well as litigation.
On June 24, 2026 and September 24, 2026, different firms each published a report (collectively, the “Short
Reports”) making allegations about the Company in an attempt to profit from a decline in the market price of our
Class A common stock, and the price of our Class A common stock declined after the publication of the Short
Reports, has continued to trade at lower prices than before the Short Reports, and the market for our Class A
common stock has been volatile since the publication of the Short Reports. Short selling is the practice of selling
securities that the seller does not own but may have borrowed with the intention of buying identical securities back
at a later date. The short seller hopes to profit from a decline in the value of the securities between the time the
securities are borrowed and the time they are replaced. As it is in the short seller’s best interests for the price of the
securities to decline, many short sellers (sometimes known as “disclosed shorts”) publish, or arrange for the
publication of, negative opinions regarding the relevant issuer and its business prospects to create negative market
momentum. These short report attacks have, in the past, led to selling of securities in the market. Further, these short
seller publications are not regulated by any governmental, self-regulatory organization or other official authority in
the U.S. and they are not subject to certification requirements imposed by the SEC. Companies that are subject to
unfavorable allegations, even if untrue may have to expend a significant amount of resources to investigate such
allegations and/or defend themselves, including securityholder suits against the company that may be prompted by
such allegations, and we have already expended significant resources and management time in response to the Short
Reports. As described in Note 17. Commitments and Contingencies to our condensed consolidated financial
statements included in this Form 10-Q, following the publication of the Short Reports, we have become the subject
of litigation relating to matters raised in the Short Reports, and future short seller reports could prompt additional
lawsuits or investigations.
We are currently subject to a putative securities class action lawsuit, and may in the future be subject to
additional securities class action lawsuits, derivative complaints, or inquiries from the SEC or other regulators. Such
actions and investigations could result in administrative orders against us, the imposition of penalties and fines
against us, damages awards against us, and the imposition of sanctions against certain of the Company’s current or
former officers, directors and employees. Resolution of these types of matters can be prolonged and costly, and the
ultimate results or judgments are uncertain due to the inherent uncertainty in the outcomes of litigation and other
proceedings. Even if we ultimately prevail in such proceedings, these proceedings could result in significant costs to
us and create distractions to our management.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
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Item 5. Other Information.
Rule 10b5-1 Plan Elections
10b5-1 trading arrangement” as defined in Item 408 of Regulation S-K. The trading arrangement is intended to
satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act and is scheduled to expire on
thirteen weeks ended September 30, 2026, no other director or officer (as defined in Rule 16a-1(f) under the
Exchange Act) of the Company adopted or terminated
trading arrangement,” as those terms are defined in Item 408 of Regulation S-K.
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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 | |||
4.1 | Indenture, dated as of July 1, 2026 by and among Equipmentshare.com Inc and Citibank, N.A. as trustee and notes collateral agent, governing the 7.125% Senior Secured Second Lien Notes due 2034. | 8-K | 001-43062 | 4.1 | July 1, 2026 | |||
4.2 | Form of 7.125% Senior Secured Second Lien Notes due 2034 (included in Exhibit 4.1). | 8-K | 001-43062 | 4.2 | July 1, 2026 | |||
10.1* | Form of Restricted Stock Unit Award Agreement for Non-Employee Directors. | 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.INS | Inline XBRL Instance Document | |||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | |||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
*Indicates a management contract or compensatory plan.
**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.
71
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: | November 10, 2026 | By: | /s/ David Marquardt | |
Name: | David Marquardt | |||
Title: | Chief Financial Officer and Chief Accounting Officer | |||