HTZ

Welcome to the Hertz Global Holdings first quarter 2026 earnings call. Currently, all lines are in listen-only mode. Following management's commentary, we will conduct a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. I would like to remind you that this morning's call is being recorded by the company. I would now like to turn the call over to Bill Kocovski, Senior Vice President, Finance. Please go ahead.

Good morning, everyone, and thank you for joining us. By now, you should have our earnings press release and associated financial information. We've also provided slides to accompany our conference call. These can be accessed through the Investor Relations section of our website. I want to remind you that certain statements made on this call contain forward-looking information. Forward-looking statements are not a guarantee of performance and by their nature are subject to inherent risks and uncertainties. Actual results may differ materially. Any forward-looking information relayed on this call speaks only as of today's date. The company undertakes no obligation to update that information to reflect changed circumstances. Additional information concerning these statements includes factors that could cause our actual results to differ.

This is contained in our earnings press release and in the risk factors and forward-looking statements section in the SEC filings we make with the Securities and Exchange Commission. Our filings are available on the SEC's website and the investor relations section of the Hertz website. Today, we'll use certain non-GAAP financial measures, which are reconciled with GAAP numbers in our earnings press release and earnings presentation available on our website. We believe that these non-GAAP measures provide additional useful information about our operations, allowing better evaluation of our profitability and performance. Unless otherwise noted, our discussion today focuses on our global business. On the call this morning, we have Gil West, our Chief Executive Officer, who will discuss strategy, operational highlights, and our fleet.

Our Chief Commercial Officer, Sandeep Dube, will share insights into our commercial strategy, followed by Scott Haralson, our Chief Financial Officer, who will discuss our financial performance. I'll now turn the call over to Gil.

Good morning, everyone, and thank you for joining us. I want to start by recognizing the Hertz team. The hard work, discipline, and resilience they bring quarter after quarter is what makes results like Q1 possible. When we laid out our transformation strategy, we framed it around three financial North Star metrics. Fleet management, measured by DPU below $300, revenue optimization measured by RPU over $1,500, and rigorous cost control measured by DOE per day in the low $30. These are our guideposts on a path to $1 billion EBITDA in 2027. Over the last two years, we fundamentally turned fleet from a headwind to a tailwind through our buy right, hold right, sell right strategy with tangible, sequential improvements that have compounded over time. We hit our DPU North Star target last year and are tracking to hit it again this year.

Over the last few quarters, we have also been building steady momentum on revenue, and we're tracking to hit our North Star RPU target for full year 2026. This quarter, the results show that our strategy is working. We set aggressive targets, and we hit them. Adjusted corporate EBITDA was up $141 million year-over-year, a nearly 50% improvement. Revenue was up 11% year-over-year, and both beat consensus. It was, in fact, our strongest year-over-year revenue growth in three years. We delivered our strongest year-over-year Q1 RPD improvement since the travel recovery and microchip-driven spike in 2022. We saw sequential improvements in both RPU and RPD throughout the quarter, a clear sign that the Hertz unique commercial strategies are paying off along with broader market strength. These results are especially meaningful given the environment we were operating in.

The quarter brought headwinds, including elevated recalls, a partial government shutdown, higher TSA wait times, and storm disruptions across key markets. Amidst this environment, our performance underscores that this transformation is driving structural improvements. On fleet, while DPU is an annual North Star target, this quarter's gross DPU beat that metric, while net DPU, which fluctuates based on net car sales gains and losses, was in line with our expectations and supported by continued disciplined fleet rotation. With our youngest fleet in nearly a decade, we're seeing our strategy translate directly into better economics. After a slow start to the year, the residual values improved significantly through the quarter. With all this, we expect full-year net DPU to remain below our North Star target of $300 per month. Even with an enriched fleet mix.

Adjusted DOE per transaction day increased approximately 2% year-over-year, driven primarily by revenue-related costs, which are EBITDA accretive and real estate sale leaseback transactions executed last year. Normalizing for these impacts, core DOE per day continued to improve year-over-year. We still have work to do, we need to continue to build scale to achieve our north star target in the low thirties. The progress is there, we have a variety of initiatives in flight. This quarter, recalls were up nearly 300%, temporarily shrinking our rentable fleet. That required us to carry more fleet than planned, impacting utilization by about 200 basis points year-over-year. Our team is strategically managing through this, making progress by working proactively upstream. We are undertaking numerous initiatives to mitigate the impact, including working with OEMs and government officials for both tactical and structural improvements.

While normalizing for the higher recalls, utilization was 140 basis points higher for the same period, showcasing our team's achievements in asset efficiency. Even with higher recalls, reported utilization was 90 basis points above where we were in Q1 of 2023 and 2024. On the customer front, we're raising the bar to build on last year's 50% improvement Net Promoter Score to deliver a truly gold standard. That work recently earned us a spot as the only rental car company on USA Today's list of most trusted brands of 2026. We also saw the highest year-over-year improvement of any car rental company on Business Travel News satisfaction survey. As we discussed last quarter, Rent-A-Car remains the foundation of our business today. Our transformation is about building more than one single value stream.

We're running today's business with discipline while deliberately investing in the capabilities that will define Hertz future. That work is creating a more diversified platform spanning rent-a-car, service, fleet, and mobility. I'm pleased to share that we made progress across our highest priority areas this quarter. In rent-a-car, we launched an advanced fleet planning engine, which leverages NVIDIA's decision optimization engine and Palantir's Foundry data operating system. This system will enable us to deliver the right car to the right place at the right time, more efficiently than ever before, delivering positive impacts across the business from utilization to customer experience. By continuing to improve our operations and strengthen our customer trust and loyalty in our brands, we're delivering greater value to our franchise partners.

At the same time, we're sharpening our focus on franchise with new leadership and a fresh look at how to unlock additional value by expanding and optimizing our franchise footprint. In fleet, Hertz Car Sales continues its evolution into a truly omni-channel business. Building on our strengthened physical and digital channels, we're establishing a scalable sales model that expands the top of the funnel and drives volume through partnerships like Amazon Autos. This week, we also announced a new partnership with eBay, putting our near new certified inventory in front of more customers than ever before. As more leads come down the funnel, our partnerships with Cox Automotive is helping drive conversion through AI-generated pricing, revamped digital tools, and better upstream lead generation tools like Autotrader. In addition, we've continued to make great progress on finance and insurance.

As car sales volumes grow, F&I scales efficiently and enhances overall unit economics. This was our best quarter in 3.5 years for F&I revenue, and we're building on this progress with more favorable financing partner arrangements. Finally, the breakthrough this quarter was in mobility, where our platform really came to life. We said that for some time that Hertz has a role in the future of mobility, and over the last few quarters, we've been building the skills and capabilities to make it real. Now we're coming out of stealth mode. Last week, we announced Oro, our mobility business, with an expanded Uber partnership. Here's the bigger picture. AV technology has the potential to unlock a multi-trillion-dollar market. As the industry transitions from personally owned vehicles to commercially operated fleets, whether driver-led or autonomous, a critical layer has been missing.

Tech providers are focused on autonomous software and hardware. OEMs are focused on vehicles. App-based platforms are focused on aggregating demand. What is missing is the operations and orchestration layer. That's where Oro comes in. Oro is purpose-built to fill the gap between autonomous technology, vehicles, and demand platforms, managing and servicing fleets reliably, efficiently, safely, and at scale. Backed by Hertz century of expertise in complex fleet management, Oro brings a distinct advantage to the market. Hertz operates one of the world's largest rideshare rental fleets with over 40,000 vehicles, and has deep experience with EVs and a management team with the direct AV operational experience. What's more, the company has a network of over 2,700 chargers, over 11,000 service locations and car washes, and thousands of maintenance technicians.

Oro harnesses that scale with agility of an independent entity to deliver flexible, vertically integrated rideshare solutions for fleets of all sizes. Oro is partnering with Uber to provide rideshare fleet services across both driver and AV fleets, delivering capabilities directly relevant for the transition to scaled autonomy. Today, Oro owns, maintains, and operates a fleet of vehicles, employing and managing over 1,000 drivers under a high-quality turnkey operating structure. Oro creates value by optimizing pre-planned supply to meet growing rider demand on Uber's platform with an elevated customer experience and additional safety protocols. Oro is currently active on the Uber platform in Atlanta, Los Angeles, and San Francisco, and Northern New Jersey just launched this week. Our drivers have logged over 4 million miles to date, and with Uber's nearly 200 million monthly active platform consumers, there's plenty of room to scale.

Oro has also joined Uber's autonomous robotaxi program, supporting Lucid vehicles equipped with Nuro AV technology. Starting later this year, Oro will provide the program's orchestration and operation by leading charging, maintenance, repairs, cleaning, and depot staffing. By managing both driver-led and driverless vehicles, we're widening our scope and deepening our experience with more complex and dynamic fleets, testing and refining economics, asset utilization and workforce models, so we'll be ready for the transition to scaled autonomy at whatever pace that occurs. While it's still early innings, Oro presents meaningful upside and reinforces the progress we've made thus far on our transformation, marking the beginning of a new chapter for Hertz. We're strengthening our core business and innovating for the future, all while furthering our mission to advance the way the world moves. With that, I'll turn it over to Sandeep.

Thanks, Gil. Good morning, everyone. Last quarter, we saw tangible progress that underscored the positive momentum our commercial strategy was driving. In our last earnings call, we said that revenue was off to a positive start in 2026. Q1 2026 full-quarter results tell an even better story. We achieved Hertz's strongest year-over-year revenue growth in three years, with revenue totaling $2 billion, an 11% increase from the year before. This was primarily driven by the structural improvements we have made to our commercial strategies, which resulted in meaningful gains in year-over-year RPU, RPD, and days. RPU was up 4.5%. We hit our North Star RPU target in March, and we have line of sight to achieving our North Star RPU metric for full year 2026.

Our Q1 RPU results showed positive momentum despite headwinds from elevated recalls, and were primarily driven by our focus on delivering positive year-over-year RPD, which was up 5%. This RPD performance marked our most significant year-over-year improvement since Q2 2022. U.S. airports showed particular strong improvement with RPD up about 8%. These revenue headlines are the product of strength across the entire quarter. During this typical seasonal trough period for the industry and amidst headwinds, we delivered sequential improvement in year-over-year revenue and RPD throughout January, February, and March. This steady progress reflects Hertz's increasing commercial maturity. As our playbook continues to yield results, we are executing with greater sophistication, leveraging the same drivers outlined in our Q3 and Q4 2025 earnings calls. Let me dive into the details. First, enhancing our customer experience.

We are making systemic improvements across every customer touch point. Leveraging deep research and insights to create a more consistent, convenient, and caring experience. We have redesigned our customer service training framework, and the results from our pilot were immediate. NPS scores rose. We have now rolled this out across our top 50 U.S. airports. Importantly, the changes we are making are being delivered consistently across the business, with our European team achieving a record net promoter score for the quarter. Second, generating greater durable demand from higher margin channels. Direct website demand is showing strong growth. Our corporate business is gaining ground. We are continuing to strengthen our partnership segment with last week's launch of a new Hertz Five Star status benefit for American Express Gold Card members, and yesterday's launch of a new strategic partnership with Air Canada's leading travel loyalty program, Aeroplan.

We are now driving consistent growth in our off-airport business, and our rideshare rental business is going strong. Third, improving our pricing tactics and strategies. Our multi-phase approach continues to bring more precision to the way we price demand. We remain focused on continuing to drive positive RPD for comparable asset classes. The new pricing matrix we spoke about in Q4 continues to contribute to RPD gains. We are seeing exciting results from an even newer version of our pricing matrix, which we executed towards the end of Q1. Early signs indicate its ability to deliver improved revenue production, the positive effects of which will show up in revenue results for mid Q2 and beyond. Fourth, improved monetization of our higher RPU assets.

Our new fleet management tools are helping advance our ability to get the right vehicle in the right location at the right time, enabling a more precise pricing approach. Fifth, better value-added product sales. We continue to drive sales of our value-added products with higher conversion and improved pricing sophistication. Q1 showed particular strength in year-over-year gains in RPD due to value-added product strategies. Finally, local level profitability and optimization. We continue to improve our ability to manage our business at a more granular level for profitability. Quarter by quarter, these initiatives are demonstrating their improved capability to enhance our revenue engine. Throughout April, our playbook drove strong performance for the month, particularly in total fleet utilization gains and mid-single-digit RPD gains. In particular, Easter weekend provided a clear example of our engine in action.

Utilization reached its highest level for any Easter since 2017, and RPD increased 10% compared to last Easter, which occurred later in the month. Together, these results drove a 16% year-over-year increase in RPU on our rentable fleet. Importantly, we generated more revenue over Easter weekend than we did last year with approximately 20,000 fewer rentable vehicles. This marks the seventh consecutive major holiday where we have grown both utilization and RPD year-over-year, highlighting the consistency of our execution. In summary, the revenue momentum, which has been building for the past few quarters through Build to Last structural improvements, has now improved to a level where it is translating to positive year-over-year revenue, RPD, and days. Fleet mix, which was a headwind for RPD in 2025, will be a tailwind through the remainder of the year.

Demand from our customers continues to look strong for the rest of Q2 and beyond. We have line of sight to achieve our North Star RPU target in 2026, primarily through a plan that delivers positive RPD. This quarter reinforces our commercial strategy is delivering. With that, I'll hand it over to Scott to walk through our financial performance.

Thanks, Sandeep. Good morning, everyone, and thanks for joining. The first quarter demonstrated continued progress across the business. Revenue momentum continues to build, our unit economics are improving, and we are managing the business with discipline. While Q1 is seasonally our most challenging quarter, the better-than-expected results reinforce that the structural improvements we continue to make are translating into tangible financial outcomes. Before I get into the quarter, I want to briefly touch on the platform. You heard Gil talk about Oro, which we are excited to unveil.

We obviously view this business as an important piece of the platform that has the potential for high growth at good margins, and therefore could have a sizable value accretion to the enterprise. As we have said before, Oro has the potential to be the most valuable asset in our platform, especially when we unlock additional value streams within Oro that are not being discussed today. There's more to the platform than Oro. We are diligently working on similar strategic unlocks for both the fleet and services side of the business that will be rolled out over time. There is a lot more this business is capable of than just renting cars. Let me walk you through the quarter in more detail. I'll also cover liquidity and our updated views on Q2 in the full year.

For Q1, we generated revenue of $2.0 billion, up 11% year-over-year, driven by continued strength in pricing, with RPD up approximately 5.5% and transaction days up around 3%. GAAP net loss for the quarter was a negative $333 million, with an adjusted net loss of negative $224 million, an improvement of approximately $105 million year-over-year. GAAP diluted EPS was negative $1.06, and adjusted EPS was negative $0.72, which was an adjusted EPS improvement of $0.35 versus the first quarter of last year. Adjusted EBITDA was negative $161 million, representing a $141 million year-over-year improvement.

EBITDA margin improved by 860 basis points to -8% from -17% in the first quarter of last year, coming in better than our guidance expectations. Recall activity was a headwind in Q1, up almost 300% higher than a year ago, taking an average of over 16,000 vehicles out of service each month. While we expected an elevated number of recalls, the lack of fixes to prior recalled vehicles and additional new recalled models drove a larger than expected number of sidelined vehicles in the quarter. To partially offset the impact, we carried more fleet than originally planned. This drove higher depreciation expense and pressured utilization and transaction days.

In total, elevated recalls reduced utilization by roughly 200 basis points, impacted transaction days by approximately 930,000, and resulted in a revenue impact of about $50 million. The total impact to adjusted EBITDA was more than $25 million. Despite that, we still produced EBITDA results that beat our expectations. Turning to cost, adjusted DOE per transaction day was $38.43, representing a 1.7% increase year-over-year. DOE per day was impacted by higher RPD-related variable costs that are EBITDA accretive and EBITDA neutral damages cost that are recovered through revenue. The reported increase was also partially driven by higher real estate expense tied to sell leaseback transactions executed after Q1 of last year.

When normalizing for these costs, DOE per day improved approximately 1.6% year-over-year, in line with what we would expect with an almost 3% increase in days. More importantly, our RPD to DOE per day spread, an important indicator of profitability, improved by approximately 12% year-over-year. SG&A increased modestly year-over-year, primarily driven by higher advertising spend as part of our strategy to invest during seasonal trough periods. Importantly, as a percentage of revenue, SG&A declined from 12% to 11.6%, reflecting improved operating leverage. Gross depreciation per unit per month for the quarter was $296. Losses on the sale of vehicles drove an additional DPU per month amount of $16, resulting in net DPU of $312.

We typically experience losses on sale of vehicles in Q1, with expected gains on sale in the second and third quarters. This puts our expectations for net DPU for the full year below our North Star target of $300 per unit per month. Turning to liquidity, we ended the quarter with $837 million, which includes cash and cash equivalents and the available capacity under our revolving credit facility. In April, we completed an additional ABS financing that added $200 million of liquidity in the second quarter. With other liquidity enhancements planned, we expect to end the second quarter with just under $1 billion and look to end the year at north of $1.5 billion.

Before I talk about guidance for Q2 and the full year, let me talk about how our views on capacity growth for Q2 and the full year have migrated, particularly in relation to what our expectations were as we enter the year. We exited Q4 with positive pricing momentum and a desire to grow the different parts of our business. A new liquidity was going to be necessary to grow, given the abnormal drains on liquidity that are occurring this year, like the Wells Fargo litigation settlement and the reduction in our revolver size that occurs in June. Early in the year, the plan was to add liquidity to fuel our growth for the year. We have since decided to limit capacity growth in the first half of the year and reevaluate it later for the second half of the year.

One of the benefits of this business is that we can be nimble with supply, unlike in other businesses that can't efficiently pivot capacity that quickly. While we believe the majority of the RPD improvements Hertz has seen to date are from our commercial strategies and tactics. We do know that industry supply has been limited, and that obviously has played a role in pushing RPD to healthier levels across the industry. As with other businesses that have significant fixed costs like ours, there is constant tension between pricing, supply, and unit cost. We appreciate that there is a balance between limiting supply for pricing power and the pressure that it puts on unit costs, and we are constantly assessing the impact of all of these on profitability and the return on invested capital.

We have North Star metrics that help guide broader, longer-term company initiatives that are particularly helpful in a transformation, but these are many times moving numerical targets. They are grounded in the solid tactical strategies around revenue optimization, fleet efficiency, and disciplined cost management. Those don't change, but as we have mentioned before, there are many ways to win in this business. We still have our eyes set on growth in the right places at the right time, but also look to optimize the balance between capital deployment, supply, unit revenues, and unit costs that produce the desired EBITDA and return on invested capital outcomes in the short run. With that preamble, let's talk guidance. For capacity, given the backdrop I just discussed, we're going to slightly reduce our outlook on days and fleet for the full year versus our original guidance expectations.

Days are now likely up in the mid-single-digit range versus the mid-to-high single-digit range we originally expected. Fleet is expected to be up low single digits year-over-year versus our original expectations of up mid-single digits. This puts some pressure on DOE per day, but we hope to keep that roughly flat year-over-year, even with sizable pressure on revenue and related expenses. RPD should, however, continue to improve for the year to the point that we think we can produce a level of total revenue for this year that gives us a similar expected EBITDA outcome, just with higher RPD and lower days than originally expected. In total, we are maintaining our EBITDA margin guidance in the 3%-6% range for the full year.

As for Q2, we expect days to be down 2-3 percentage points year-over-year and fleet down about 1-2 percentage points as recalls continue to weigh on days production. With April RPD production strong, we expect the Q2 year-over-year improvement in RPD to be higher than Q1. We also expect net DPU will be well below $300 per month as we expect to take sizable gains on the sale of vehicles in the quarter. Altogether, we expect an EBITDA margin in the low to mid-single-digit range for the quarter. As for 2027, we still continue to target $1 billion of EBITDA for the year. With that, I'll turn it back to Gil for closing remarks.

Thank you, Scott. A big story this quarter, of course, is our progress on the commercial side, especially in our revenue growth. The even bigger story is cementing our position in the future of mobility with Oro. We haven't just been executing a turnaround, though make no mistake, that alone has taken a tremendous effort. We've been building quietly, deliberately, and with real conviction about where this industry is going. Driving innovation at a century-old company isn't easy, but we're proving it can be done. Oro is not a bet. It's the result of doing the hard work, finding the gap, selecting the right partners, and putting our capabilities to work in new ways. We're strengthening our core and building what comes next. That's the Hertz story right now, and I couldn't be more confident in where it's heading. With that, let's open it up for questions.

Back to you, operator.

We will now begin the question-and-answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. Please pick up your handset when asking a question. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Chris Woronka of Deutsche Bank. Your line is open. Please go ahead.

Good morning, guys. Thanks for taking the question. Thinking through all this news with Oro and some of your platform messaging and I guess just trying to kind of assess how much Hertz is really worth today. I mean, it seems like, given all the changes, maybe some of the, you know, traditional valuation framework or metrics that we typically look at are potentially becoming a little bit less relevant and maybe could lead to a, you know, a different approach in how we look at your company. I mean, how are you guys kind of internally thinking about valuation in light of some of these transformations and, you know, other business changes that you're making?

Thanks, Chris. Great question. I'll start, and I imagine Scott will want to chime in, too. I mean, it kinda sounds like you've been sitting in our meeting rooms and boardrooms, but I think candidly the valuation of our business today is tough. The problem with our current valuation is that it's an almost entirely based on traditional rental car business, which is understandable. So that's a, you know, that's a paradigm that's hard to overcome. It's hard for us just to say, "Hey, we're, we are, and we will be more than a traditional rental car business," and expect people to immediately assign different valuations to our business.

I'd just point out historically, the company subordinated all parts of the Hertz platform to optimize the rental car business, which, you know, ironically might be the least valuable part of our platform. We're shifting that paradigm to really look at all parts of our platform as interrelated standalone businesses to manage and create value around. To change the way Hertz is valued, I know, you know, we're gonna have to provide evidence and, you know, this week, you know, we unveiled Oro, and that business, if valued as a standalone, could have a sizable valuation. Our fleet business, as it continues to develop, should also have a sizable valuation.

You know, as we think about it, after the rental car transformation is largely complete, all these businesses together could have a real sum of the parts impact that could be material to the overall valuation of the company. In fact, I think one of the issues we gotta deal with will be, each of the pieces of the platform as we talked about it, have different growth rates, right? Also different margin profiles, different capital requirements, and will probably attract different investor types and different valuation methodologies and probably even different multiples to the business. That's, you know, how we're starting to look at it.

Yeah. Hey, hey, Chris, this is Scott. Hey, thanks for the question. Yeah, I think Gil, to Gil's last point, I think that's likely part of the disconnect between how the equity markets are beginning to view our stock versus maybe some of the price targets that, you know, the analysts on the call set. You know, that traditional view of rental car company valuations and multiples, you know, will probably need to be reevaluated to take into account the different aspects of the platform Gil was talking about and the sum of the parts attributes. You know, I might even urge each of you to potentially even take a different approach to how you think about it. You know, appreciating the nuances between the transformational rental car and valuing what is really a top five used car dealership.

Really, you know, that has a competitive supply advantage. You have the mobility platform that provides, you know, what will be critical nuts and bolts infrastructure to rideshare, delivery, autonomous transportation. I would just be curious, you know, how you guys view it after you take that sum of the parts view. I will say in fairness, Chris, that, you know, I'll have to acknowledge that we haven't made it easy for you guys to really value us correctly yet, given the limited information we give you. That's on us. You know, we'll figure that out. Along with figuring out the strategy around how to create the value, we also got to figure out the best way to report it.

You know, honestly, I think in the end, we'll need to figure out, you know, things like how to structure the company, the businesses that unlocks the greatest shareholder value, and even how to structure the P&L, and to report the businesses differently. You know, we'll have to adapt the messaging and to this changing landscape. You know, I think more of these alterations over time, different viewpoints, I think will definitely help people, you know, correctly value the business as we go forward.

Yeah. Super helpful and really appreciate the thoughts, guys. If I could get a quick follow-up. You know.

You kind of hit on this in the prepared remarks. DPU or sorry, the DOE per day, understanding your North Star targets, and I think DPU is pretty well understood at this point. DOE, do you envision a situation beyond 26, maybe it's 27, where you're not quite in that low 30s on DOE per transaction day, per day, but you're maybe higher on RPD or RPU, whichever you like to look at? Could that be kind of a, as you mentioned, same way to get to a or different way to get to a same outcome of $1 billion next year?

I wasn't sure if your comments about the being higher on RPD or RPU and higher on DOE exclusive to 26, or could that be kind of a, you know, go forward thing too? Thanks.

Yeah, yeah. Certainly. Hey, Chris, this is Scott. I'll start. Yeah, I think you kinda hit on it. Obviously, the spread between RPD and DOE per day is the sort of critical one. There's different ways to move the business that would change RPD and DOE per day, and that spread's critical. You know, obviously, you know, we have targets around unit cost and everything. There's, there's components of this that will have, you know, a bit of a longer tail. I would argue our cost management discipline is as much around long-term cost efficiency as it is just short-term cost cutting, which is complex, you know, in a transformational, you know, rental car business set up.

Look, we got to return some scale back to the business that's been reduced over the last, you know, five or six years. We'll also, you know, look to grow other parts of the platform. You know, I'll argue a bit that today our DOE expenses are, you know, 70% driven by labor, facilities, and maintenance and repair. You know, we've done a good job on labor, workforce planning. Collision repair has seen some increased volume, but we've done a good job with, you know, reducing rates, the way we pay for repairs. Facilities is a stickier cost. You know, we probably have more footprint than we need, you know, given the current size of the fleet. These costs are not the easiest to reduce, you know, given the lease terms.

Over time, we'll continue to manage that. At the end of the day, you know, we're gonna need some scale. You know, we've talked about this. The good news is we don't need a ton of scale, right? There's a lot of leverage here. You know, in fact, I'd argue probably 10%-15% more scale, you know, we'd have a sub 35 DOE per day number. It's in front of us. I think it's just gonna take a little time, but it's, you know, it's just something we're gonna have to deal with as we think through all the parts.

Great. Very helpful. Thanks, guys.

Thanks, Chris.

Thanks.

Your next question comes from Christopher Stathopoulos of SIG. Your line is open. Please go ahead.

Good morning, everyone. Scott or Gil, on the inflection here in RPU, if you could. You called out a few things on the quarter, the partial shutdown, storms recall. If you could perhaps break those out, just want to get a sense of how core is looking, and then your confidence around maintaining that positive growth through the year. I know you're pulling in your fleet guide to low single digits. Just want to understand if there's other areas that give you confidence around that. I typically think about your booking window as the shortest within my coverage, so 0-30, 0-40. Just want to understand your confidence around maintaining that growth through the balance of the year.

Yeah, Chris, thanks for the question. This is Sandeep here. I'll talk about basically RPD and how we think about that. The RPD improvement that we saw in Q1 was primarily driven by Hertz's unique commercial strategies and supported by broader market strength. I'll touch upon both of those. First, let me briefly cover the broader market strength reference. We've seen more pricing discipline in the market, I'd say starting late Q4, and certainly more so all through Q1 and into Q2 so far. The industry pricing has been positive, I'd say, and especially since mid-Feb and consistently so. From an industry discipline context, feels like we are now swimming downstream, and it's a contrast from what we felt before.

That's definitely encouraging, that provides a good platform. Here's the main kicker, right? It's basically Hertz's unique commercial strategies, which we detailed a bit in the script. I would characterize those strategies as the follows. First, unique in terms of the positive impact it creates for us. Second, largely durable and persistent in their accretive impact to our business. This is largely irrespective of broader market conditions. Third, I'd say growing in strength quarter-over-quarter. We first articulated these commercial strategies in Q1 2025, you can see the sequential improvement in year-over-year revenue and RPD since then. four to five quarters of consistent year-over-year improvement. The positive impact of these has now cumulatively led to positive revenue, RPD, and days in Q1 2026.

I think what excites us is the journey ahead. We have a clear commercial strategy, an execution plan of initiatives over the next few quarters that will keep building momentum and a motivated team. Chris, we are on a different and a more exciting trajectory commercially than what we have had in multiple years prior to that. Yeah, this is fun now.

Yeah. I would just add too, I think a big part of it is, you know, it all starts with demand, right? I mean, when we talk about the sustainability of this, you know, sustainable demand underpins everything on the pricing side. I think the team's done a really good job structurally over the last couple of years building that demand. Whether it's direct demand through our dot com type, hertz.com loyalty channels, that's been big, through partnerships, through commercial agreements, corporates. You know, all of that really has helped us, you know, develop the demand side of the equation that, you know, the, the RM type strategies and initiatives can really resonate on. I think Sandeep said it well.

You know, I think if anything, we feel confident those, you know, all of that is gonna help us sustain improvements in where we're at and build off that as we go forward, in addition to whatever the broader market does on top of that as more of an amplifier.

Okay. Then it sounds like at some point you're gonna give us a little bit more disclosure on Oro and car sales. In the meanwhile, as we look at your Northstar RPU, above or more than $1,500 and, you know, the DOE low 30s, as we think about, I guess, the back half and 2027 and these segments start to grow, any color you can kinda give us as we think about things like revenue and margin contribution until these segments are ultimately broken out. Thanks.

Yeah. I think, you know, a little bit on maybe Oro to talk about that one first. I guess it may be in the materials you've seen it, but I'd just point out that, you know, within that construct, we have three different businesses there, all of them kind of different maturity levels, different growth rates, et cetera. We're not just starting from scratch. We have kind of a platform we're building on. We should see growth really across all three of these, but at different rates. The first one I would describe is what would be the more traditional rideshare rental car business, where we're renting cars to rideshare drivers, you know, through the partnerships we've got with Uber and Lyft.

We've been at that a two years. Now we're among the largest in the world. As I mentioned, I think, in the script, we've got over 40,000, you know, vehicles, combination of EV and ICE vehicles, right? That's kind of the existing platform. We continue to lean in and build off that. The other two businesses that really are new in a sense, at least to the broader market. We've been working both of these for at least the last two years. The 1st one is where we've got the Oro driven fleet, where we've got this high-quality turnkey capacity we're providing to Uber. We've leaned in, we've leveraged technology to better manage the kind of driver life cycle productivity. You know, we're also leveraging it to scale in our safety performance.

As we, as we think about that, you know, we're ramping through a measured market-by-market expansion, and we're scaling kind of proven programs now. There's a clear line of sight to demand. This is a, you know, large, you know, addressable market. You know, as we, as we move forward, we got to make sure the economics work at a market level. We've got to make sure we got the operational controls in place, and ultimately, we're scaling with discipline. We're gated by things like operational readiness, safety thresholds, the economic returns. We're just not after top line here. I want to emphasize that. We do think this is gonna be more and more a meaningful contributor to, you know, the overall company's results.

Then the third piece of this is AV operations, right? There, of course, with the partnerships that we've announced, you know, over the last week. You know, we know we've got the ability to be a major player in this space. We've got unique capabilities that only a handful of companies can bring. The pace of AV growth, I think, is gonna be probably a, you know, maybe a little longer tail, but potentially much higher ultimately. We've got kind of a whole spectrum here of three businesses within mobility with different growth rates, all with good margins that should be accretive to the company. You know, that windage, you know, we'll have to give you more color as we move forward.

Yeah. Hey, hey, Chris. This is Scott, too. I'll add a little bit to that. You know, that Oro is obviously an important piece of it. As you think about the near-term P&L 2027, 2028, you know, mention the spread. RPD, you know, definitely moving in the right direction. You know, I mean, you heard Sandeep's commentary. I mean, U.S. airports were up, you know, 9% alone on RPD. Definitely positive RPD stuff. Oro is gonna be great. Also too, I mean, we have grown our fleet car sales F&I income, which sits in the revenue line. It's been the largest line we've had since, you know, in recent history, and there's a ton of room to grow that without corresponding, you know, DOE and expenses associated.

Plus, the other piece is, we've talked about growing franchise, which has, you know, a direct revenue benefit with very little corresponding costs associated. As we talk about growing revenue without cost, those are the things that are gonna create that big spread going forward. It's not just about rental car RPD and the costs associated. There's other pieces that will create that gap.

Okay. Thank you.

Your next question comes from the line of John Healy of Northcoast Research. Your line is open. Please go ahead.

Thanks for taking the questions. I love how you named it Oro. I think that means gold in a different language or a couple different languages.

Hey, you're multilingual.

Very, very cool. Very cool move. I would just love to get your thoughts about. I think, Scott, you'd mentioned, we need to figure out how to monetize or get value for some of these pieces of the development that we haven't, you know, gone to market with. Can you get more granular with us on that? You know, I think with Oro, you guys are actually hiring drivers in certain markets to kind of go with the fleet you're providing. Would just love to get your thoughts on just how some of these aspects of the operation might evolve from here.

Yeah, maybe I'll start around kind of the Oro driven fleet piece. I'll talk just a little bit more about that. Scott, you may want to add some additional broader color on the valuation side. You know, I guess the first point I'd make here is that. You know, Oro is not entering into just a generic human capital business, I'll just say that up front. Really what we're trying to do here is provide think of it as turnkey rideshare capacity to Uber. Okay, turnkey. You know, we're really just putting the pieces we already have out there in place here. None of this is really new. You know, what we're doing really is operating fleets end-to-end under a contracted capacity supply, and we're employing drivers as part of that equation.

Keep in mind, we've got thousands of people already driving our cars that are employees. You know, we're well-positioned, we have all the pieces. You know, we're just putting them together to fill a gap here. You know, we already manage a really large distributed workforces across the operations. We own the fleet, we have the maintenance and logistics. I just point out, I think the model is superior to the traditional gig structure, since it provides really a more predictable, more predictability and control, along with higher quality in terms of the customer experience, as well as safety performance. There's value created around that.

Again, we're really deliberately scaling this and we're gated, you know, as I mentioned, just mentioned about, you know, kind of the operational performance, safety thresholds, the economics, all those things. The real focus is getting it right. The other thing I've got to point out here is that this is a real stepping stone to running AVs at scale, right? This is an operational cadence that's not normal for a rental car company, well, even though we have all the pieces. As we're kind of building that rhythm, it's directly applicable to the AVs, it's just without the drivers at that point. Kind of we're bridging really all the aspects of rideshare, but, you know, it's got application in other businesses like delivery, right? Other potential partners.

You know, this is a, you know, these are big markets. We've got all the pieces and we can play in it.

Yeah, no, I think that's right on, Gil. John, hey, good morning. Look, I think, you know, we're not gonna be able to talk a lot about the economics of the deal here, but I think what Gil pointed out is exactly right, which is this plays into the strengths of what Hertz, you know, does well. You know, we're a big human capital provider. You know, we employ thousands, even those that drive cars today, for us. This is an extension of that, plays into the real estate footprint that we have today, the maintenance capabilities, the fleet management and control. All of these things, you know, are most of things that we do today with a slight twist.

As Gil said, is a massive bridge to tomorrow's AV world. This is a very nice extension of what we do today that will provide near-term benefit to the P&L while also setting us up for longer term, you know, AV infrastructure capabilities.

Thank you, guys. That's great. Scott, just one follow-up question on the expectations for Q2. Did I hear you right when you said that you're expecting global days to be down, but for the year we're going to be up mid-single digit? I was just hoping you could just run that past us again. Thanks.

That is right, John. We'll be down in Q2, which would imply up in Q3 and Q4. Obviously there's some year-over-year nuances as days were probably a little smaller in Q4 of last year. There'll be some year-over-year nuance of the math, but we won't be as big in Q2 as we would have liked, you know, given the macro demand economics, but that'll recover a bit in Q3 and Q4.

Understood. Thank you.

We have reached the end of the Q&A session. This concludes today's call. Thank you for attending. You may now disconnect.

Welcome to the Hertz Global Holdings Fourth Quarter and Full Year 2025 Earnings Call. [Operator Instructions] I would like to remind you that this morning's call is being recorded by the company. I would now like to turn the call over to our host, Johann Rawlinson, Vice President of Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining us. By now, you should have our earnings press release and associated financial information and these can be accessed through the Investor Relations section of our website. I want to remind you that certain statements made on this call contain forward-looking information. Forward-looking statements are not a guarantee of performance, and by their nature, are subject to inherent risks and uncertainties. Actual results may differ materially. Any forward-looking information relayed on this call speaks only as of today's date, and the company undertakes no obligation to update that information to reflect changed circumstances. Additional information concerning these statements including factors that could cause our actual results to differ is contained in our earnings press release and in the Risk Factors and Forward-Looking Statement section in the filings we make with the Securities and Exchange Commission. Our filings are available on the SEC's website and the Investor Relations section of the Hertz website. Today, we'll use certain non-GAAP financial measures which are reconciled with GAAP numbers in our earnings press release available on our website. We believe that these non-GAAP measures provide additional useful information about our operations, allowing better evaluation of our profitability and performance. Unless otherwise noted, our discussion today focuses on our global business. On the call this morning, we have Gil West, our Chief Executive Officer, who will discuss strategy, operational highlights and our fleet. Our Chief Commercial Officer, Sandeep Dube, will share insights into our commercial strategy followed by Scott Haralson, our Chief Financial Officer, who will discuss our financial performance. I'll now turn the call over to Gil.

Thanks, Johann. Good morning, everyone, and thank you for joining us. I want to start by thanking the Hertz team, their focus, discipline and resilience, especially those serving our customers in the field was evident throughout the year but particularly during the fourth quarter holiday travel season, which is historically one of our most operationally intensive periods. Together, they executed consistently against our goals and made real progress, building momentum for the year ahead. 2025 marked the first full year operating under the back-to-basic strategy, guided by our North Star metrics, we brought greater discipline to fleet management, revenue optimization, rigorous cost control and improving the customer experience. The work is far from finished, but the progress we made this year materially strengthened the foundation of our business for the long term. In 2025, we achieved a full year adjusted EBITDA improvement of more than $1 billion year-over-year. We drove sequential improvements in revenue, RPU and RPD and improved utilization by sweating our assets and drove DPU down in line with our North Star target. We brought DOE per transaction day down despite lower volumes. We also completed our fleet rotation and successfully secured our model year '26 buys at our target prices and volumes. That allowed us to begin selling model year '25 through our enhanced retail channels, continue our short hold strategy, introduce a more optimized mix of car classes and achieve our lowest average fleet age in almost a decade. And we delivered a nearly 50% improvement in customer satisfaction. As we turn to the fourth quarter, typically challenging seasonal environment was amplified by a number of external headwinds that were primarily isolated to the quarter from government shutdown, coupled with FAA cancellations, multiple technology vendor outages and unfavorable residual value environment to elevated recall volumes. Taken together, these created outsized pressure of well over $100 million on our business and kept us from hitting some of our targets. But even within that environment, we made progress. In the fourth quarter, adjusted EBITDA improved $150 million year-over-year, but our strongest result this quarter was revenue. In fact, it was our strongest revenue result in nearly 2 years. If you remember, we entered 2025 with revenue down double digits year-over-year. And by the end of the fourth quarter, we were nearly flat revenue with a 3% smaller fleet, significant accomplishment, driven by our ability to sequentially improve RPU and RPD and sustained utilization and transaction days, all with a smaller fleet. We also saw a more stable industry pricing backdrop throughout the quarter, which is especially noteworthy given the very polarizing peak and off-peak dynamic that plays out during this period every year. This is evidence that both our commercial investments in pricing and demand generation are paying off and that the industry setup is more positive than in prior periods. While DPU, as I mentioned, was in line with our North Star target for the year, in the fourth quarter, it moved above our North Star target due to a revised Black Book residual value forecast and lower-than-expected whole sale prices from heavy OEM and rental car company deflating during the car market seasonal low period. While we monitor multiple market trend sources, we have historically indexed heavily on Black Book forecast, which tends to be more seasonally volatile. As of the end of the year, it was down nearly 5% year-over-year, resulting in a $60 million noncash charge to depreciation. By contrast, Manheim average rental vehicle prices in December were up 2.85% year-over-year. And as we look ahead, updated projections from our partners at Cox Automotive show that their Manheim used vehicle value index is expected to end the year roughly 2% higher than in December 2025. While our forecast is not predicated on such a positive outlook, our internal analysis is encouraging and we've seen early signs of recovery in Q1 in line with these Manheim values, which in January were up 2.4% year-over-year. On the cost side, we brought adjusted DOE per transaction day down 6% year-on-year. This moved us closer to our North Star target in the low 30s. Recall volumes peaked in mid-November and December, taking over 20,000 cars out of service, which is almost 3x higher than the normal rate. This resulted in us having to carry more fleet than we had planned and limited our performance, which had ripple effects across the business, impacting our fleet utilization, particularly for our rideshare business. We have strategically managed through this by redeploying available fleet where it would have the most impact. And as a vast majority of these recalls lack available fixes and restrict us from renting and selling vehicles. We are actively working with our OEM partners to find solutions to minimize fleet downtime. Recall volumes have moderated slightly throughout the first quarter but remain elevated. With this in mind, we're staying disciplined in our capacity planning to ensure our rentable fleet stays well utilized and inside of demand. It's clear Q4 presented real challenges, but the decisions we made throughout 2025 held up under pressure and reinforced that our strategy is the right one. Today, Hertz stands on a meaningfully stronger foundation than it did a year ago. A healthier fleet, improved unit economics, a more disciplined operating model, a better customer experience. And what I want to be clear about is this, the improvements we're seeing in the business are structural, they're permanent. The headwinds we faced and continue to navigate are transitory. That difference matters, and it's what gives me confidence in the trajectory ahead. That confidence is already being validated as 2026 is off to a good start. Q1 trends in both revenue and RPD are positive year-over-year, a particularly encouraging sign given that this is typically a seasonal trough period for the industry. This means we're entering the upcoming peak period from a position of strength. Looking ahead to the rest of the year, we remain focused on accelerating revenue, RPD and RPU growth while staying disciplined on cost, putting core rental business firmly on the path to profitability. While rent-a-car remains our core business today, this transformation is about becoming more than a single line of business. We're executing with discipline in the business that powers us now, but we're intentionally building the capabilities that will power what's next. We're laying the groundwork for a diversified value-creating platform that will unlock value beyond the core. The Hertz platform spans rent-a-car, service, fleet and mobility. It's still early days. And while the areas of our platform sit at different maturity levels, each presents meaningful upside, both near and long term. In rent-a-car, we'll maintain steady momentum in our mature airport locations by driving pricing, utilization, demand generation and asset management. We still -- we see real near-term upside from growth in our off-airport locations in areas like insurance replacement local commercial agreements and small business. We're also sharpening our focus to unlock additional value in our franchise footprint while piloting new offerings in service. We see a particularly strong runway in fleet through Hertz car sales and in mobility, where the long-term opportunity has the potential to become as, if not more meaningful than our core rent-a-car business. We're transforming Hertz car sales into a truly omnichannel experience, meeting customers where they are online, in person through rent to buy and delivery right to their door. The opportunity here is significant. We are a used car factory with a building customer base, and we're building the shopping experience to match, one that can ultimately rival the largest used car dealers in the country. We have a constant supply of preowned vehicles and sales volume that already puts us in the top 5 used car dealerships in the country. Our improved website has a wide variety of vehicles for sale and intuitive interface, enhanced imagery and more detailed descriptions to help customers shop more confidently. We already have scale in shifting our primary sales channel to retail as a major unlock. We also have established key partnerships with Cox Automotive, Amazon and Palantir that gives us the capability to scale this business profitably, Hertz car sales value proposition has never been more compelling as new cars are increasingly out of reach for many buyers with prices topping $50,000 on average. With our shorthold strategy, we deliver best bang for the buck as consumers can get a nearly new car for around half the cost. This is an important differentiator as we head into spring, typically a peak buying season, which will be bolstered this year by record high tax returns. Now to mobility. Hertz owns and manages fleets at scale with core strengths and fleet ownership, large-scale operations, world-class maintenance and vehicle fleet financing. Along our physical infrastructure, operating capacity and leadership experience, this business is evolving to meet the mobility needs of tomorrow, whether driver led or autonomous. Our journey in mobility began in ride share by renting cars to Uber and Lyft drivers. Today, we operate the largest rideshare rental fleet in the world. And it has become one of our highest growth potential businesses with double-digit revenue opportunities. And in the background, we're developing and testing new approaches in this space with strategic partners. While it's difficult to quantify the full growth potential of our Mobility business at this stage, the opportunity undoubtedly is significant. For context, Uber's CEO has described autonomous vehicles as potentially a multitrillion dollar market. We're building the capabilities now to ensure Hertz is positioned to play a significant role in that ecosystem. Today, our rental car business remains the largest consumer of our time and operational focus. But as we scale the broader platform across rent-a-car, service, fleet and mobility, the mix will evolve. Rental will become one part of a more diversified value-creating enterprise. With that, I'll turn it over to Sandeep.

Thanks, Gil, and good morning, everyone. I want to jump right into the headlines on revenue this morning. The fourth quarter, the industry's typical trough period with volatile seasonal demand, represented Hertz's strongest year-over-year revenue result since Q1 2024. After adjusting for Q4 2024's onetime loyalty gains, in Q4 2025, we drove year-over-year revenue growth with the primary driver being RPD which was nearly flat on a year-over-year basis. Most importantly, RPD for the airports in the Americas, our largest segment, was positive year-over-year for the quarter. We achieved this meaningful sequential improvement despite several headwinds, including a lower car class mix, the extended government shutdown and elevated recalls. In Q4, we achieved a difficult feat by improving both year-over-year pricing and days sequentially, primarily driven by Hertz's commercial strategies. Our revenue metrics showed good sequential progression. Q4 2025 adjusted revenue was sequentially 4 points better, going from down 4% to about flat. RPD mirrored the same sequential improvement on a loyalty adjusted basis as well. The driving factors of these improvements were the same as detailed in our Q3 earnings call. Let's dive deeper into the details a bit. First, driving a better customer experience. Our Net Promoter grew by nearly 50% year-over-year and it is driving better organic demand for our brands. Second, generating greater durable demand from higher-margin channels. Direct website demand is showing strong growth. Our corporate business is gaining ground. We are now driving consistent growth in our off-airport business, and our mobility business is growing revenue double digits. Third, improving our pricing tactics and strategies. We are on a multiphase approach to bring more sophistication in the way we drive demand with a focus on driving positive RPD for comparable asset class. Mid-quarter in Q4, we executed a totally new pricing metrics and we saw immediate results from that change in driving positive RPD. Our next situation is going into test mode in a few weeks. I expect phase improvements in the sophistication of our pricing approach. Fourth, better monetization of our higher RPU assets. This was achieved by improved asset deployment, having the right vehicle at the right location, ensuring that higher RPU assets are effectively monetized. Fifth, better value-added product sales. We drove better sales of our value-added products through improved operational performance and pricing sophistication. Lastly, local level profitability and optimization. We continue to manage our business at a more granular level of profitability. These commercial strategies and tactics primarily drove the positive momentum in Q4 2025. Most importantly, these foundational changes raised the baseline productivity of our revenue and RPD production, and we expect these gains to largely persist irrespective of the macroeconomic environment. And just a reminder, we are still in the early innings of a transformation of our commercial strategies, and we expect more foundational improvements in the coming quarters. If you step back even further, the takeaway here is the sequential improvement through 2025 as a result of our back to basic strategy. We started 2025 down double digits year-over-year on revenue and down mid-single digits year-over-year on RPD. This narrowed to near parity on both metrics by the end of the year, and they have both turned positive in the early part of 2026. We also delivered improvements in utilization across our total fleet in each of the quarters in 2025, including Q4, where we were able to offset the impact of higher rate of recalls and delivered an improvement of 200 basis points year-over-year. Total fleet includes all vehicles irrespective of operating status, whether in service, out of service or in our car sales inventory. Looking [indiscernible] we are delivering clear results and building momentum for the year ahead. 2026 is off to a strong start as the strength we saw at the end of December for the holidays carried forward into the new year. In January, we are seeing year-on-year positive revenue and unit revenue growth, mostly driven by a couple of percentage points increase in global RPD, reflecting pricing growth in both our Americas and our International segments. February is trending even more positively and March looks to continue on that trajectory. As a result, we expect Q1 2026 revenue to be up mid-single digits year-over-year with fleet growth of only low single digits. Q1 2026 is also supported by a more constructive industry environment compared to Q4 2025, with the industry demand environment looking better. For the rest of 2026, we will manage our growth in a disciplined manner. This means holding airport growth at or below TSA levels, while pursuing off-airport and mobility opportunities. At the same time, we are focused on doing more for our customers. The improvements we have seen in our Net Promoter Score is a clear indicator that our work to create a more consistent, convenient and caring customer experience are resonating. We are deeply grateful to the millions of customers who choose Hertz, and we have recently lowered the threshold for achieving 5-star status to reward them even more for their loyalty. At a time and status across the travel industry feels harder to earn than ever, we are offering a faster, more transparent part, providing more value with every booking and one more reason to continue choosing Hertz. So in summary, our commercial playbook is working, and the results are starting to prove it. With that, I'll hand it over to Scott to walk through our financial performance.

Thanks, Sandeep, and good morning, everyone, and thanks for joining us. As you heard from Gil and Sandeep, the fourth quarter had a number of items that cloud the results. But once you get past the transitory impacts in the quarter, you can see some interesting foundational elements. The revenue trends are improving. Our fleet is rotated and model year 2026 buys have been secured at prices and volumes we expected. In spite of a richer fleet mix in 2026, which will provide a tailwind to RPD, we still expect to keep DPU for the year below $300 per unit. NPS took a big leap forward in 2025 and that's prime to continue in 2026. Our digital customer experience, operational consistency and customer-focused initiatives are being recognized by our customers. We have found a good balance between utilization and NPS scores, but have our eyes set on improving both at the same time. The moves we made last year to create a rental car fleet with an average age of less than 10 months, which is the youngest it's been in almost a decade and to drive record-setting utilization are now strategic tailwinds. The cost and efficiency actions paid dividends and will get even better in 2026. Throughout 2025, we pulled off a difficult task. We lowered unit cost while also reducing units. That's difficult to do in a heavy fixed cost and operationally complex business like ours. We have real opportunities for growth in 2026. The focus of that growth will be at our off-airport locations and in our mobility business. Our expansion of the platform outside of traditional rental car is progressing nicely. Our digital car sales business has made some important technological advancements on both the back-end website and the merchandising capabilities as well as the digital transformation of the car sales process. While early, we think 2026 digital expansion could produce a meaningful progression in the percentage of our car sales that will be transacted through retail channels. On mobility, while we are the industry leader in rental ride share, we are growing and developing the business to meet evolving needs. We also have been actively building in the background a substantial set of capabilities that we will be leveraging to position Hertz to be a significant player in the aggregation of the supply of mobility in the future, whether that is driver led or autonomous. This will ultimately be the future of Hertz, but we are balancing the current optimization of the mature part of our business while building the platform for the future. Even though the absolute financial results are not where we want them to be yet, the actions we have taken over the past year or so are showing real sustainable results and the opportunity in front of us is exciting. So with that preamble, I do want to quickly walk through some details in the quarter, where we are with liquidity and cover a bit of our 2026 outlook. Starting with the quarter. For Q4, we reported revenue of $2.0 billion, which came in ahead of consensus expectations with RPD broadly in line and down approximately 1% year-over-year. Importantly, excluding the prior year loyalty adjustment, revenue growth was up year-on-year with RPD nearly flat. Adjusted EBITDA for the quarter was a negative approximately $200 million. While this is a $150 million year-over-year improvement, it was still about $100 million off of our target. This was entirely in our vehicle carrying cost. We incurred about $20 million of additional costs resulting from the additional fleet to compensate for the elevated recalls. We also had a $20 million loss on the sale of assets due to the large number of cars available in the marketplace that weighed on residuals in the quarter. We also took a noncash depreciation expense of approximately $60 million due to the late in the quarter residual value adjustment by Black Book. While we do believe the adjustment on the forward view of residuals to be a bit conservative, we did take the entire impact to the P&L. We view these items as mostly isolated to the fourth quarter, albeit recalls will likely remain elevated throughout the first quarter. We expect the residual value market to improve as we head into the peak car sale cycle starting in Q1 into Q2. The government shutdown duration and timing also weighed on results. We were able to recoup most of the days lost in the period, but it did come in more off-peak days production since the shutdown came in what was becoming an improving October with positive demand and pricing momentum. While difficult to quantify and while the revenue for the quarter was still positive, we estimate the government shutdown cost us an additional $10 million to $20 million of adjusted EBITDA in the quarter. In total, the underlying business performed better than the reported adjusted EBITDA would suggest as we performed well on the items within our control. Transaction days were almost flat year-over-year as we kept the higher fleet to mitigate the recall issues and recoup some of the days lost due to the transitory events. Utilization remains solid. And even with the additional fleet, the global fleet was 3% lower than prior year. Adjusted DOE per day was another positive story. It improved 6% year-over-year, coming in at $36.39 as our cost initiatives are taking hold. It did, however, reflect higher collision severity and repair cost and ongoing elevated insurance costs. We still have more to do, but have done good work on addressing operating expenses in our big 3 categories: labor facilities and vehicle maintenance and repair. With further work to be done in growth in transaction days in 2026, we do expect lower unit costs this year. Core SG&A remained flat with total year-over-year variances primarily stemming from the timing of expenses in 2024, with 2025 being a more normalized expense level. Turning to depreciation and DPU. For 2025, we produced a full year net DPU of $300 per month. While this is right at our North Star metric, we were certainly not happy that we had to take a late charge to depreciation due to the move from Black Book. We were expecting to be below $300 per unit. However, if residual values end up where we think they will in 2026, this will prove to be timing of the expense and will benefit us with less depreciation this year. The fourth quarter ended at $330 per unit, down 21% year-over-year, but nonetheless, higher than we expected. Now let's talk liquidity. We ended the quarter with approximately $1.5 billion of total liquidity, including revolver capacity. This reflects the impact of the partial redemption of $300 million of the 2026 notes in Q4, leaving $200 million outstanding. The Wells Fargo make-whole liability, which had been reserved for some time, was primarily concluded with the $346 million payment made in late January. This reduced our available liquidity to just under $1.2 billion. This number was about $100 million lower than expected due to the timing of vehicle dispositions that were delayed and the early acceptance of vehicles in Q4 due to the larger number of recalls and the impact of the government shutdown. Other than the cost to carry the additional vehicles in the quarter, the timing of the vehicles in and out of the fleet is not expected to have any meaningful positive or negative impact on our expected liquidity at the end of the second quarter. Also, our ABS programs remain healthy with ABS vehicle fair values comfortably above net book values and market access is solid. We recently entered into financing transactions that we expect will result in an increase in our liquidity by approximately $200 million at an attractive cost of capital. We also have several other liquidity enhancement opportunities that we'll be evaluating in the coming months, that could total more than $500 million. In addition, we also have approximately $400 million of first lien capacity to refinance the expiring revolving credit facility commitments in June of this year. With the disciplined growth that we have planned for 2026, we have access to the liquidity capacity to make that happen. We expect to reach the low point of liquidity at the end of Q2 at something likely below $1 billion, as we invest in the fleet in the first half of the year and then expect to end the year well north of $1 billion as free cash flow generation improves after Q1 and from the return of capital that happens in the fleet rotation cycle in the back half of the year. To be clear, this assumes we action some of the liquidity enhancements we have available to us. Finally, let's turn to guidance for the year. For Q1, we expect transaction days and fleet to increase low single digits year-over-year. Total fleet utilization will likely be flat in Q1 year-over-year due to the impact from the heavy winter storms and continued elevated fleet recalls, which should decline throughout the quarter. On the revenue front, as Gil and Sandeep noted, January saw positive year-over-year RPD and revenue growth, with February trending even better and March bookings to date showing a similar trend. However, Q1 is still an off-peak quarter for us and the recall levels are still going to impact our results. Given this, our Q1 expected margin range is in the negative high single-digit to low double-digit range, which is a year-over-year improvement of approximately 600 to 800 basis points, assuming DPU at around $300 per unit. For the full year, we previously communicated an outlook of a 3% to 6% adjusted EBITDA margin range. While the revenue trends were positive and the internal expectations for DPU are in line with prior expectations, it is early in the year, and we would like to see more game film before we revise the guidance upward. That's why we are maintaining the guidance for the year in the 3% to 6% margin range. We continue to target $1 billion of adjusted EBITDA in 2027. With that, I'll turn it back to Gil for closing remarks.

Thank you, Scott. 2025 was a year of back to basics, focused on rebuilding the core and transforming Hertz for the long term. We first tackled our fleet, the biggest problem to solve, along with cost and revenue, all while elevating our customer experience. Through our fleet strategy and rotation, we operated as an asset management company, and the team turned our fleet, which was once a massive headwind, into a competitive advantage positioning us well for 2026 and beyond. We delivered year-over-year improvements in unit cost even with a smaller fleet and we see a long runway of cost and productivity initiatives that cut across all aspects of our business. This, along with operating leverage from growth should help propel us forward. Unit revenue growth has been a key area of focus. The team's work around customer service, demand generation in the right segments, revenue management strategies and initiatives are paying off and we have the talent, tools and technology to continue this momentum and return Hertz to solid profitability this year and achieve over $1 billion in adjusted EBITDA in 2027. But our transformation does not stop there. We're both pragmatic and ambitious, focused on what's in front of us while also planning for the future. We're making progress in developing our platform to unlock value beyond our core business, leveraging the same operational discipline, rigorous cost control and revenue optimization that would define this turnaround. With that, let's open it up for questions. Back to you, operator.

[Operator Instructions] Our first question comes from the line of Chris Woronka with Deutsche Bank.

I guess, Gil, to start off, one of your competitors recently took about a $500 million write-down related to EVs. And obviously, Hertz went through a process a couple of years back that I think is complete or largely complete. Can you maybe give us a refresh on where you guys are in EVs and your strategy has changed or evolved at all recently?

Yes. Chris, thanks for the question. Yes, I think a lot of headlines across all the automotive industry on EVs, of course, of late. And I think we're probably a little further down the road than most, and we do have a bit of a different strategy now in that I'd just start with some context. We're the largest fleet supplier to rideshare in the world, as I mentioned. It's really important to get that fleet right because the rideshare just has different fleet needs in our traditional rack business and EVs remain central to rideshare and remain a long-lived asset in that fleet. So we're just probably more experienced than anyone as an EV fleet operator at scale. We've been building a lot of operational muscle around EVs over the years, and that includes the technical expertise as well as operating infrastructure. So kind of as part of our transformation, as you well know, we've gone through and rightsized our EV fleet based on what the natural demand is for EVs. So essentially, we've redeployed that fleet in the right channels with the majority of that fleet moving towards rideshare business. And that puts EVs into real high-intensive operating environments. And that helps us accelerate our learning curve. So specifically with our Tesla fleet, just to give you an example, we're in the process of doing an interior refresh on that fleet. So it's really given the where we've encountered on the interiors over the last several years. So this is a low-cost investment per vehicle for us. And then the vehicle condition comes out looking nearly new and then extends the life of the useful life of that asset. And then, of course, has considerable economic benefits for us on that fleet. So we got a world-class maintenance and tech ops team. And they've done this all their life really on older generation aircraft, applying a similar approach where we refurbish the interiors and do it at a low cost. So it's what's happening with our Tesla fleet. And ultimately then, I think with that fleet, the limiting life factor will be battery life at this point, kind of given the current battery replacement cost. But even that could change in the future. But we got to remain agile with our EV fleet. It's really set us up well, though in our rideshare position. And then it's probably worth noting that, that experience we've been building with EVs really sets us up well in the future for AVs because I think every future autonomous vehicle will likely be an EV. So all that will bode well for us in the future.

Our next question comes from the line of Chris Stathoulopoulos with Susquehanna International Group.

So Gil, if a lot of commentary here on the mobility business, your prepared remarks I think you said mobility has the potential to more than surpass rent a car. So could you dig into a little bit more here on the future potential of the mobility business for Hertz? What does that look like? What is the plan for the next year, 1, 3, 5 years, if you could? Just want a little bit more detail on how you're thinking about that.

Thanks, Chris. I mean, obviously, as we mentioned in the call, the potential is significant here, and we continue to position Hertz for the future of mobility. And I think we'll be a big part of that because we've got -- we've already got great partnerships in the rideshare space. So as you think about kind of the next step of mobility, it's really the evolution of rideshare into autonomous. So we've been piloting some innovative new models with a strategic partner, and we're starting to scale some of those. We'll talk about those in the future. But I think we're a natural player in mobility and ultimately, the AV space as it continues to evolve. So we've got really an incredible team leading our mobility business. I'm extremely bullish about what that future looks like. So maybe just to recap, as I see it, at least, how the space plays out. First of all, it will be a huge TAM, if you will. We had some comments in the script about that. And it's not a winner-take-all game. It's very big. And I think we're -- Hertz is really one of just a limited number of companies that have all the necessary ingredients to be a major player in AVs, right? Our core business is owning and operating large fleets of vehicles. And that's a foundational requirement in AVs and the model for mobility going forward. So we've got an iconic brand. We've got a global footprint. We got operational excellence. We got really advanced maintenance capabilities. And then, of course, large fleet management skills and as I mentioned -- just mentioned, experience managing EVs. And again, I'll just reiterate, I think in the future, almost all AVs will be EVs. So that experience will be a big stepping stone for us. But we've got rideshare experience, the infrastructure. We're an asset-heavy business, but we've got the vehicle financing capability. And then we've got a team literally with years of direct AV operating experience. So I mean, in sum, I think we've got the right ingredients to do it. We're focused on it. But I'd be remiss if I also didn't say we're also focused on making sure the core business is turning, head in the right direction, and we're not going to be distracted by anything around that. But we can do more than one thing, and we are and mobility is a big part of our future.

Our next question comes from the line of Dan Levy with Barclays.

I wanted to go back to the question of DPU. And I know your North Star metric is the $300. But perhaps you could just walk us through again the path to how you can sustainably be at that $300 given some of the vehicle inflation that we've seen, what offsets do you have? Because just mathematically, if you're holding a car for 18 months and the price is going up, that DPU is going to just increase above $300. So what offsets do you have to get it to that $300? And what's the confidence on that?

Yes. Thanks, Dan. I appreciate the question. I'll start, and Scott, feel free to add. But yes, we've got confidence that kind of our end-to-end fleet strategy that we've talked about in the past will work in any environment, first of all, and we can maintain the sub-300 DPU this year and beyond. So although as we noted, there's some seasonality in the trends and some volatility. But we've rotated the fleet. We've got model year '25, '26 vehicles to sustain our depreciation North Star and the used car market set up well this year as we move forward. We've also pivoting into heavier retail car sales, along with shorter hold periods. And I think both of those will be tailwinds for us as we go forward. But ultimately, it's about managing the right buy, hold and sell at a make-model trim level in order to maximize the retention value over that whole period. It's not necessarily the cap cost. It's the retention value from what we buy it for the net purchase price and what we sell it for. And that retention value then over that whole period is the key. So -- and managing that really gives us the ability to hit our DPU targets.

Yes. Dan, it's Scott too. I'll just add an important sort of mathematical component here. Obviously, we buy a ton of vehicles at sort of large volumes that are significantly below MSRP. And at that sort of discount level, I mean, ideally, you turn around and sell the vehicle the next day, obviously, to monetize that discount. But obviously, we can't do that, and we rent the car for a period of time. But to Gil's point, the idea of a short hold has significant mathematical components, albeit operationally complex because you do need a large inflow of vehicles, you need the piping to be able to exit vehicles at that volume. So the combination of all those things create the ability to optimize DPU that we think will be below $300. And we have the capabilities to drive it a good bit further once all of the components sort of start humming. So I think mathematically, you could easily get to that point. And historically, the rental car business has been well below $300. So I don't think we're charting new territory here, respectively. But I think there's a lot of components that we've definitely gotten good at, and we'll continue to do that. But I think mathematically, it's important to sort of think of it around those factors.

Great. And if I could just ask a follow-up on the liquidity standpoint. So I appreciate the commentary on Q2 being the trough and some other liquidity actions. But just given you're still going to be a ways away from being free cash flow positive, maybe you could just comment on the free cash flow dynamics. But in the absence of that, what other capital raise options you have to keep the liquidity in line until you hit free cash flow positive?

Yes. Let me touch on a couple of points there, Dan. I think we'll make pretty sizable strides in free cash flow generation in '26. Obviously, post Q1, if you sort of look at the margin profile, we'll be somewhat cash flow neutral in the year post Q1. And so the -- obviously, we got to drive the business in '27 to the point where we become cash flow positive, covering all of the components within our working capital needs. But we talked about a few things that we have in the pipeline, the $200 million initiative that we created, which was an alternative letter credit facility that reduces the need for those funds to be taken out of the RCF. We have a large number of initiatives that are not your typical sort of first lien offering, which we have as well that talk about things like more capacity within our ABS structure. We have real estate assets that are both locations we no longer need. I mean we're a 100-year-old company. So we have some excess assets that we need to monetize as we optimize our facility footprint. But we also have other locations where we do operate and want to continue that we may do sale-leaseback transactions on at a very good cost of capital. That's a better capital allocation than owning real estate across the entire network. We also have a number of strategic initiatives to grow our franchise base, including new geographies where we don't operate today, plus some locations that are corporate-owned and operated, which are desirable franchise opportunities that are both strategically interesting, but also create an upfront capital infusion opportunity. So there's a whole host of items here that give us a good bit of flexibility, including the first lien capacity that we have, which is roughly $400 million. A lot of that comes from the rolling off of some of the RCF capacity that we can refinance in the year.

Your next question comes from the line of John Healy with Northcoast Research.

Gil, I wanted to go to a comment that you kind of weaved into the prepared remarks a few times, you used the word off-airport. And you seem to use it in separation with the word mobility. So would just love to get your view on the word off-airport, what you guys are doing there. If it is separate than the mobility business, and is it related to maybe a desire to get back into the insurance business that the company was in a while ago.

Yes. Thanks, John. Yes, just to clarify, I appreciate that question. The way we were using it, the term off-airport was in respect to our rental car business, not for mobility. So it's a separate and included part of our rental car business. And we consider, of course, on-airport and our what we call Hertz local addition, off-airport volume in that mix. And maybe just for context, that growth in that, we do see the growth and it's profitable growth for us, and we're disciplined about that. But if you recall, as we rotated the fleet, we had to shrink our fleet in order to accelerate the rotation of the fleet. We're managing capital. We're managing vehicle availability. We're managing -- working our way through depreciation, all those things. So we had to shrink to accelerate the fleet rotation. Essentially, we kept our airport capacity more or less flat during that period. And we shrink in our off-airport HLE location and to some degree, our mobility business. So as we think about off-airport and growing that business in '26, it's really just kind of going back to where we were in prior years is certainly the first step of that. The demand is there, again, in various segments. And so that's really the context of off-airport. Mobility is separate, right? We're growing that business. It's even at a much faster rate than off-airport. And it's through the partnerships. And again, that's got, we think, a long runway.

John, this is Scott. Just a quick comment. I think we view those businesses differently, too, by the way. The airport has different demand profiles, obviously driven by airlines and TSA demand, our off-airport business has a different cycle to it, obviously, related to insurance replacement and even some of the leisure demand and commercial components operate on a different cyclical component. So as we think about growth profiles, profitability profiles. We do view those a bit differently, which is why when we talk about growth, we segment it out into the sort of airport off-airport, rideshare components just because they behave differently.

Great. And then just one question on cap structure and balance sheet. You guys have said that, I believe, 300 to 600 basis points of EBITDA margin this year. If you're at the high end of that range, does that get you towards kind of cash flow breakeven for the year? And just longer term, any thoughts about the approach to deleveraging here? I mean, even on the '27 goal of $1 billion in EBITDA, even if we earmark a lot of that improvement to debt repayment, we're still an awfully levered company. So just wanted to get your thoughts about how we bring down leverage. And I know you talked about sale leaseback and some of those things. But I would just love to get your view on ideal cap structure and hypothetically, like maybe when we could be below certain leverage levels?

Yes. John, it's a good question. Obviously, the business has to get to the point where it can cover its sort of debt servicing and working capital needs. I mean you could probably do the math within our balance sheet, but the sort of free cash flow breakeven number sits in that sort of 6% to 7%. So yes, at the high end of that, we're going to be pretty close to sort of free cash flow breakeven for the year. And I've said this before, obviously, the business has to get to the point where it's producing free cash flow to start thinking about using those funds to delever. There are other components that will take place in the future as well as we refinance. We may have the capability within our stock price to use equity at some point in the future that we've talked about that we're definitely price sensitive to that because we are so optimistic about where the business goes. And the other components of that, that we think through are how the platform and the initiatives will play out in forming the ability to delever. We think the components of mobility and fleet car sales will both drive operating profits to the business as well as an infusion of equity capital that may also participate in all the holistic views of capitalizing those components necessary to grow those businesses, but also helping the cap structure at the same time. So there's a lot of moving pieces, and this is going to happen over time. But the first step is getting the business on solid profitable footing.

Our next question comes from the line of Ryan Brinkman with JP Morgan.

With regard to the Hertz car sales strategy, what are you expecting in terms of the percentage of vehicles disposed of via various channels in 2026 relative to 2025? And maybe looking beyond this year also, what is assumed already in your North Star target for per unit depreciation of under $300 per month or $1 billion of EBITDA in '27 versus what level of disposition performance would be incremental to those targets?

Yes. I'll start with the latter point, Ryan. Nothing, right? We're not assuming that Hertz car sales factors into the $1 billion of EBITDA in '27 or really anything material this year. The real key from a growth standpoint, there's 2 points I would make here on Hertz car sales because we do want to grow the percent of car sales that we have into retail. Keep in mind, historically, what we've done is to move volume through the rental car seasonal periods and do it through wholesale channels in order to match the timing of kind of the ins and outs of that. So we're shifting our strategy to move the bulk of that volume through retail channels and shorten our sales time to do that. Today, we're roughly at, call it, about 1/3 of our cars move through retail channels. Today, that's both Hertz car sales, our direct sales along with retail partners that we have established to move volume through. Aspirationally, we want to grow that to about 80%. So there's a path there, and we're pushing hard to do that. And then if you peel that back, I think we tried to cover a little bit of this in the script, but we see kind of a couple of pieces to that, right? We've got a physical footprint today. We've been investing in our digital channels and e-commerce as well. And the combination of those creates a really good model for us, right? So we can meet our customers where ultimately they want to be, right, rather than just relying either/or on a physical channel or a digital channel. So that combination is really important for us. We've got a lot of great ingredients to drive this. Of course, we've got a building customer base. People are test driving our cars every day. We've done rent to buy. We partnered with Cox to revamp our website. Again, I would encourage you guys to go see it. It's really impressive. I would also just mention, on a customer basis, the cars we sell to customers. The Net Promoter Scores of those buyers are as high as anything I've ever seen anywhere. They're over 90% Net Promoter Scores. That's almost impossible achievement, candidly. So the experience is already good. We've got a great trusted brand. And then it's a matter of top-of-funnel demand. We've got big partnerships that drive that. And then the real problems for us to solve are distilling that into qualified leads and conversion rates. And the team is really focused on that. We've got some great people helping us. And that -- those are the real keys. Along with driving up our net margin per sale. It's not just about volume. Ultimately, it's about adding a few thousand dollars to the net here, selling hundreds of thousands of cars where we have the material impact. So the net margin is key in the equation. We've been focusing really hard on reconditioning cost, along with capturing F&I that on the back end of the transaction that we've never had. So combination of those 2 plus selling more digitally reduces the overall selling expenses. So -- and we're seeing the margin side heading the right way on a per car basis, and then it's about increasing volume. We're -- look, it's -- this isn't easy, obviously, but we got the ability to -- again, we've already got the scale. It's just a matter of channel shift in the way we're selling. So a big opportunity for us.

Okay. And then lastly, with regards to the more sophisticated approach to pricing that you referenced in your prepared remarks is leading to higher revenue per unit, and you expect to contribute more, are you utilizing a refining a new or existing software system? Or what would you say are the drivers of the progress so far and the catalyst for further improvement?

And just to clarify, are you talking about the car sales or our rental business, rental car business?

Now the rental, the pricing that's baked into the RPD.

So we're doing the same, by the way, on the cars. But go ahead, Sandeep.

Yes, this is Sandeep here. Yes. Thanks for the question there on pricing sophistication. So see, we are relooking broad scale how we price demand overall, right? And it's a combination of improved systems. And we've talked about this in prior earnings calls around our work around there. And that's a longer term, and we are well on that journey. On top of that, you have to always relook how you structure your pricing and the approach that you use within the systems, right? And that's the piece that I referred to when I talked about Q4, where we've infused the revenue management team with some new talent. There's some really good thinking that's going on there. And we've applied different queries into how we actually price for demand, and that's leading to a different outcome there. So I think it's a combination of systems and different thinking. And by the way, this is still in the early innings of how we kind of go about this. This is a journey, and I expect continuous improvement on this front.

Our next question comes from the line of Chris Woronka with Deutsche Bank.

So the second question is going to be kind of as we think about the $1 billion target for next year on EBITDA, we know that the North Star targets are kind of numerically. But if I think about how much fleet maybe that requires? And then also more importantly, on the revenue side, maybe you can, at a high level, directionally bucket for us where you think -- is this market share on corporate? Is it market share on leisure? Is it more rideshare where you don't maybe have quite as much direct competition? If you could maybe, at some high level, bucket those out for us, what you think drives that would be super helpful.

Okay. Well, I'll start, and I would encourage Scott and Sandeep to dive in. Thanks, Chris. Yes, first of all, I think in terms of the $1 billion EBITDA in '27, I mean, a little bit of context, at least from my view, I mean these aren't uncharted waters, right? We've been there in the past. Others in the industry are there now and achieve that level of performance. So it's clearly achievable. I think the North Star financial targets that we've given on DPU, RPU and DOE, along with some just modest growth, get us there conceptually, and we can talk about any of those assumptions. And then, of course, the approach we've taken on back to basics laid a foundation to get there. The trajectory of all those metrics are heading that way, right? They turn, they're heading that direction. I think the biggest economic lever, as you know, is the fleet, which we've addressed, and that's the economic engine. And we're tracking really with all the North Star metrics directionally where we want to go. We'll never be satisfied with the timing and we'll keep pushing hard. That is the one variable that's always a little difficult to gauge given the kind of nature of the significant transformation we've been doing. But there's a strong sense of urgency at the team. Everybody is full throttle. The needles are moving. So we've talked about depth some, maybe the revenue piece, you want to touch on.

Yes. On the revenue piece, I think, again, it's going to be very, very disciplined growth, right? And going back to our business lines, right? On the airport side, we're going to be very clear that our growth is going to be at or below TSA levels. And the beauty in there is we're going to keep refining the segments that we -- the segment mix there so that we generate a higher and higher margin out of our airports. And for the off-airport business, again, there's more growth there, and we'll keep working on that. I think Gil alluded to that earlier on. By the way, there's a segment mix play within the off-airport segment business line as well, which would help us enhance the margins there. And then lastly, mobility, again, we have talked about that. There's more growth there. We're growing that business at a pretty good clip and we'll continue on that journey. But I would say discipline in where we grow and discipline on how we fleet is the answer there.

Yes. I think just real quick before we wrap up the call here, Chris, is that I think mathematically, all 3 levels of the North Star get you well above $1 billion. I think the point here is that there's a number of ways to get there. They all don't have to hit to hit $1 billion, plus you've got the fourth dimension of scale, which plays into here. And then we really haven't even talked about the platform component that adds on to it. So Gil talked about timing, but I think the takeaway is there's multiple ways to get there.

There are no further questions at this time. This concludes the Hertz Global Holdings Fourth Quarter and Full Year 2025 Earnings Conference Call. Thank you for your participation.