Avis Budget Group 2025 Q2 Earnings EPS Declines Sharply

Avis Budget Group (CAR) reported its fiscal 2025 Q2 earnings on Jul 29th, 2025. The total revenue of Avis Budget Group decreased by 0.3% to $3.04 billion in 2025 Q2, down from $3.05 billion in 2024 Q2. Avis Budget Group's Q2 results missed expectations, with a notable 75.6% decline in EPS to $0.10. Net income also fell by 66.7% to $5 million. Looking forward, the company anticipates adjusted EBITDA growth, particularly in the Americas, driven by lower fleet costs and strategic initiatives.

Revenue

For the second quarter, Avis Budget Group reported revenues of $3.04 billion, a slight decrease from the $3.05 billion reported in Q2 2024. The Americas segment generated $2.332 billion, slightly down from $2.361 billion, while the International segment saw an increase, reaching $707 million compared to $687 million in the previous year.

Earnings/Net Income

Avis Budget Group's EPS declined 75.6% to $0.10 in 2025 Q2 from $0.41 in 2024 Q2. Meanwhile, the company's net income declined to $5 million in 2025 Q2, down 66.7% from $15 million reported in 2024 Q2. The sharp drop in EPS indicates a challenging quarter for the company.

Price Action

The stock price of Avis Budget Group dropped 4.18% during the latest trading day, edged up 2.07% during the most recent full trading week, and jumped 13.71% month-to-date.

Post-Earnings Price Action Review

The strategy of buying Avis Budget Group (CAR) shares on the date of its revenue raise and holding for 30 days yielded impressive returns over the past three years. The 30-day holding period strategy resulted in a 52.59% annual return for CAR shares, significantly outperforming the S&P 500's total return of 13.49%. Avis Budget Group consistently exceeded market expectations in the second quarter of 2025, driving the strategy's success. Despite the positive revenue raise, CAR shares experienced volatility following the earnings release, providing opportunities for the 30-day holding period to capture price movements. Strategic partnerships, such as with Waymo, and product innovations like Avis First, contributed to growth, influencing stock performance and providing additional upside potential for the strategy. In conclusion, buying CAR shares on the revenue raise date and holding for 30 days delivered substantial returns, supported by consistent performance, strategic partnerships, and market reactions to innovation.

CEO Commentary

“At Avis Budget Group, we're building to scale where we hold structural advantages. With Avis First, we've created the category of first-class car rental designed through product innovation and delivered with operational excellence. With our Waymo partnership, we're stepping into the autonomous future as a critical enabler of next-generation fleet management,” said Brian Choi, CEO of Avis Budget Group. He emphasized that the company is not just competing but aiming to win by taking a leading role in the evolving mobility ecosystem, showcasing optimism about future growth driven by strategic innovations.

Guidance

The company expressed confidence in its future performance, indicating expectations for continued growth in Adjusted EBITDA, particularly in the Americas, driven by lower fleet costs and improved vehicle utilization. While noting challenges such as flat rental days, Avis Budget Group anticipates that strategic initiatives like the launch of Avis First and the partnership with Waymo will enhance market positioning and operational efficiency moving forward.

Additional News

Avis Budget Group recently announced significant leadership changes, with CEO Joe Ferraro transitioning to a Board Advisor role effective June 30, 2025. Brian Choi, previously the Chief Transformation Officer, assumed the CEO position on July 1, 2025. This transition marks a pivotal moment for the company, as it positions itself to focus on operational evolution and technological innovation. Additionally, Avis Budget Group appointed Daniel Cunha as Chief Financial Officer, effective July 1, 2025. Cunha is expected to play a critical role in driving the company's long-term strategic and financial objectives. These leadership changes signal a strategic shift aimed at sustaining growth and enhancing the company's competitive position in the evolving mobility industry.