What caused Avis's net profit to drop sharply in 2024?

Avis Budget Group's net profit dropped sharply in 2024 primarily due to higher expenses and reduced revenue in certain quarters, despite improved demand and cost cuts in the fourth quarter:

1. **Revenue Decline in Key Quarters**: Revenue was lower than expected in several quarters, such as the second and third quarters, with Q2 revenue at $3.05 billion (a 2.4% decrease from Q2 2023) and Q3 revenue at $3.48 billion (a 2.4% decrease from Q3 2023). This decline in revenue, particularly in key quarters, contributed significantly to the net profit drop.
2. **Higher Expenses**: The company faced increased expenses, which squeezed profitability. For instance, Q2's net income plummeted to $14 million (a 97% decrease from Q2 2023), primarily driven by higher expenses. Similarly, Q3's net income fell to $237 million (a 62% decrease from Q3 2023), with the decrease in margin mainly attributed to higher expenses.
3. **Global Challenges**: Internationally, the company faced challenges, as evidenced by an Adjusted EBITDA loss of $15 million in Q1 2024, highlighting global challenges faced by the company.
4. **Fleet Costs**: Higher fleet costs and a decrease in revenue per day also contributed to the drop in profitability, with profitability dropping to $6.65 per share from $16.78 per share year-over-year, and revenue decreasing by 2.2% to $3.48 billion, missing expectations.

In summary, Avis Budget Group's net profit drop in 2024 was primarily caused by a combination of lower revenue in key quarters, higher expenses, global challenges, and increased fleet costs.