Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2024 | Jul. 22, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 1-14387 | |
Entity Registrant Name | United Rentals, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 06-1522496 | |
Entity Address, Address Line One | 100 First Stamford Place | |
Entity Address, Address Line Two | Suite 700 | |
Entity Address, City or Town | Stamford | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06902 | |
City Area Code | 203 | |
Local Phone Number | 622-3131 | |
Title of 12(b) Security | Common Stock, $.01 par value, of United Rentals, Inc. | |
Trading Symbol | URI | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 66,135,871 | |
Entity Central Index Key | 0001067701 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
ASSETS | ||
Cash and cash equivalents | $ 467 | $ 363 |
Accounts receivable, net | 2,260 | 2,230 |
Inventory | 219 | 205 |
Prepaid expenses and other assets | 273 | 135 |
Total current assets | 3,219 | 2,933 |
Goodwill | 6,749 | 5,940 |
Other intangible assets, net | 744 | 670 |
Operating lease right-of-use assets | 1,211 | 1,099 |
Other long-term assets | 47 | 43 |
Total assets | 27,613 | 25,589 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Short-term debt and current maturities of long-term debt | 1,369 | 1,465 |
Accounts payable | 1,349 | 905 |
Accrued expenses and other liabilities | 1,251 | 1,267 |
Total current liabilities | 3,969 | 3,637 |
Long-term debt | 11,520 | 10,053 |
Deferred taxes | 2,672 | 2,701 |
Operating lease liabilities | 988 | 895 |
Other long-term liabilities | 183 | 173 |
Total liabilities | 19,332 | 17,459 |
Common stock—$0.01 par value, 500,000,000 shares authorized, 115,109,208 and 66,235,191 shares issued and outstanding, respectively, at June 30, 2024 and 115,010,396 and 67,269,577 shares issued and outstanding, respectively, at December 31, 2023 | 1 | 1 |
Additional paid-in capital | 2,664 | 2,650 |
Retained earnings | 12,630 | 11,672 |
Treasury stock at cost—48,874,017 and 47,740,819 shares at June 30, 2024 and December 31, 2023, respectively | (6,722) | (5,965) |
Accumulated other comprehensive loss | (292) | (228) |
Total stockholders’ equity | 8,281 | 8,130 |
Total liabilities and stockholders’ equity | 27,613 | 25,589 |
Rental equipment, net | ||
ASSETS | ||
Equipment | 14,685 | 14,001 |
Property and equipment, net | ||
ASSETS | ||
Equipment | $ 958 | $ 903 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2024 | Dec. 31, 2023 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, issued (in shares) | 115,109,208 | 115,010,396 |
Common stock, outstanding (in shares) | 66,235,191 | 67,269,577 |
Treasury stock (in shares) | 48,874,017 | 47,740,819 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenues: | ||||
Total revenues | $ 3,773 | $ 3,554 | $ 7,258 | $ 6,839 |
Cost of revenues: | ||||
Cost of equipment rentals, excluding depreciation | 1,322 | 1,216 | 2,566 | 2,378 |
Depreciation of rental equipment | 608 | 592 | 1,190 | 1,167 |
Total cost of revenues | 2,255 | 2,129 | 4,394 | 4,173 |
Gross profit | 1,518 | 1,425 | 2,864 | 2,666 |
Selling, general and administrative expenses | 404 | 378 | 793 | 760 |
Restructuring charge | 1 | 18 | 2 | 19 |
Non-rental depreciation and amortization | 109 | 104 | 213 | 222 |
Operating income | 1,004 | 925 | 1,856 | 1,665 |
Interest expense, net | 173 | 161 | 333 | 311 |
Other income, net | (4) | (8) | (7) | (12) |
Income before provision for income taxes | 835 | 772 | 1,530 | 1,366 |
Provision for income taxes | 199 | 181 | 352 | 324 |
Net income | $ 636 | $ 591 | $ 1,178 | $ 1,042 |
Basic earnings per share (in dollars per share) | $ 9.56 | $ 8.60 | $ 17.62 | $ 15.09 |
Diluted earnings per share (in dollars per share) | $ 9.54 | $ 8.58 | $ 17.57 | $ 15.04 |
Equipment rentals | ||||
Revenues: | ||||
Total revenues | $ 3,215 | $ 2,981 | $ 6,144 | $ 5,721 |
Sales of rental equipment | ||||
Revenues: | ||||
Total revenues | 365 | 382 | 748 | 770 |
Cost of revenues: | ||||
Cost of goods and services sold | 192 | 186 | 388 | 384 |
Sales of new equipment | ||||
Revenues: | ||||
Total revenues | 61 | 70 | 109 | 114 |
Cost of revenues: | ||||
Cost of goods and services sold | 49 | 58 | 87 | 94 |
Contractor supplies sales | ||||
Revenues: | ||||
Total revenues | 42 | 37 | 78 | 71 |
Cost of revenues: | ||||
Cost of goods and services sold | 29 | 26 | 54 | 50 |
Service and other revenues | ||||
Revenues: | ||||
Total revenues | 90 | 84 | 179 | 163 |
Cost of revenues: | ||||
Cost of goods and services sold | $ 55 | $ 51 | $ 109 | $ 100 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | ||
Statement of Comprehensive Income [Abstract] | |||||
Net income | $ 636 | $ 591 | $ 1,178 | $ 1,042 | |
Other comprehensive (loss) income, net of tax: | |||||
Foreign currency translation adjustments | [1] | (13) | 23 | (64) | 24 |
Fixed price diesel swaps | 0 | 0 | 0 | (1) | |
Other comprehensive (loss) income | [1] | (13) | 23 | (64) | 23 |
Comprehensive income | $ 623 | $ 614 | $ 1,114 | $ 1,065 | |
[1] There were no material reclassifications from accumulated other comprehensive loss reflected in other comprehensive income (loss) during 2024 or 2023. There were no material taxes associated with other comprehensive income (loss) during 2024 or 2023. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Reclassification from AOCI, current period, net of tax, attributable to parent | $ 0 | $ 0 | $ 0 | $ 0 |
Other comprehensive income (loss), tax, portion attributable to parent | $ 0 | $ 0 | $ 0 | $ 0 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Loss | ||||
Beginning balance (in shares) at Dec. 31, 2022 | [1] | 69,000,000 | ||||||||
Beginning balance at Dec. 31, 2022 | $ 1 | $ 2,626 | $ 9,656 | $ (4,957) | $ (264) | [2] | ||||
Beginning balance (in shares) at Dec. 31, 2022 | 45,000,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | $ 1,042 | 1,042 | ||||||||
Dividends declared | [3] | (205) | ||||||||
Foreign currency translation adjustments | 24 | [4] | 24 | [2] | ||||||
Fixed price diesel swaps | (1) | (1) | [2] | |||||||
Stock compensation expense, net (in shares) | [1] | 1,000,000 | ||||||||
Stock compensation expense, net | 49 | |||||||||
Tax withholding for share based compensation | (54) | |||||||||
Repurchase of common stock (in shares) | (2,000,000) | [1] | (2,000,000) | |||||||
Repurchase of common stock | $ (503) | |||||||||
Ending balance (in shares) at Jun. 30, 2023 | [1],[2] | 68,000,000 | ||||||||
Ending balance at Jun. 30, 2023 | $ 1 | 2,621 | 10,493 | $ (5,460) | (241) | [2],[3] | ||||
Ending balance (in shares) at Jun. 30, 2023 | 47,000,000 | |||||||||
Beginning balance (in shares) at Mar. 31, 2023 | [1],[2] | 69,000,000 | ||||||||
Beginning balance at Mar. 31, 2023 | $ 1 | 2,598 | 10,003 | $ (5,208) | (264) | [3] | ||||
Beginning balance (in shares) at Mar. 31, 2023 | 46,000,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 591 | 591 | ||||||||
Dividends declared | [3] | (101) | ||||||||
Foreign currency translation adjustments | 23 | [4] | 23 | [3] | ||||||
Fixed price diesel swaps | $ 0 | |||||||||
Stock compensation expense, net | 25 | |||||||||
Tax withholding for share based compensation | (2) | |||||||||
Repurchase of common stock (in shares) | (1,000,000) | [1],[2] | (1,000,000) | |||||||
Repurchase of common stock | $ (252) | |||||||||
Ending balance (in shares) at Jun. 30, 2023 | [1],[2] | 68,000,000 | ||||||||
Ending balance at Jun. 30, 2023 | $ 1 | 2,621 | 10,493 | $ (5,460) | (241) | [2],[3] | ||||
Ending balance (in shares) at Jun. 30, 2023 | 47,000,000 | |||||||||
Beginning balance (in shares) at Dec. 31, 2023 | 67,269,577 | 67,000,000 | [1] | |||||||
Beginning balance at Dec. 31, 2023 | $ 8,130 | $ 1 | 2,650 | 11,672 | $ (5,965) | (228) | [2] | |||
Beginning balance (in shares) at Dec. 31, 2023 | 47,740,819 | 48,000,000 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | $ 1,178 | 1,178 | ||||||||
Dividends declared | [3] | (220) | ||||||||
Foreign currency translation adjustments | (64) | [4] | (64) | [2] | ||||||
Fixed price diesel swaps | $ 0 | |||||||||
Stock compensation expense, net | 55 | |||||||||
Tax withholding for share based compensation | (41) | |||||||||
Repurchase of common stock (in shares) | (1,000,000) | [1] | (1,000,000) | |||||||
Repurchase of common stock | $ (757) | |||||||||
Ending balance (in shares) at Jun. 30, 2024 | 66,235,191 | 66,000,000 | [1],[2] | |||||||
Ending balance at Jun. 30, 2024 | $ 8,281 | $ 1 | 2,664 | 12,630 | $ (6,722) | (292) | [2],[3] | |||
Ending balance (in shares) at Jun. 30, 2024 | 48,874,017 | 49,000,000 | ||||||||
Beginning balance (in shares) at Mar. 31, 2024 | [1],[2] | 67,000,000 | ||||||||
Beginning balance at Mar. 31, 2024 | $ 1 | 2,638 | 12,103 | $ (6,343) | (279) | [3] | ||||
Beginning balance (in shares) at Mar. 31, 2024 | 48,000,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | $ 636 | 636 | ||||||||
Dividends declared | [3] | (109) | ||||||||
Foreign currency translation adjustments | (13) | [4] | (13) | [3] | ||||||
Fixed price diesel swaps | $ 0 | |||||||||
Stock compensation expense, net | 27 | |||||||||
Tax withholding for share based compensation | (1) | |||||||||
Repurchase of common stock (in shares) | (1,000,000) | [1],[2] | (1,000,000) | |||||||
Repurchase of common stock | $ (379) | |||||||||
Ending balance (in shares) at Jun. 30, 2024 | 66,235,191 | 66,000,000 | [1],[2] | |||||||
Ending balance at Jun. 30, 2024 | $ 8,281 | $ 1 | $ 2,664 | $ 12,630 | $ (6,722) | $ (292) | [2],[3] | |||
Ending balance (in shares) at Jun. 30, 2024 | 48,874,017 | 49,000,000 | ||||||||
[1] Common stock outstanding decreased by approximately two million net shares during the year ended December 31, 2023. The Accumulated Other Comprehensive Loss balance primarily reflects foreign currency translation adjustments. We declared dividends of $1.63 and $1.48 per share during the three months ended June 30, 2024 and 2023, respectively, and $3.26 and $2.96 per share during the six months ended June 30, 2024 and 2023, respectively. There were no material reclassifications from accumulated other comprehensive loss reflected in other comprehensive income (loss) during 2024 or 2023. There were no material taxes associated with other comprehensive income (loss) during 2024 or 2023. |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares shares in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Dividends declared (in dollars per share) | $ 1.63 | $ 1.48 | $ 3.26 | $ 2.96 | |
Common Stock | |||||
Change in common stock outstanding (in shares) | (2) |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Cash Flows From Operating Activities: | ||
Net income | $ 1,178 | $ 1,042 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 1,403 | 1,389 |
Amortization of deferred financing costs and original issue discounts | 7 | 7 |
Gain on sales of rental equipment | (360) | (386) |
Gain on sales of non-rental equipment | (8) | (10) |
Insurance proceeds from damaged equipment | (24) | (19) |
Stock compensation expense, net | 55 | 49 |
Restructuring charge | 2 | 19 |
Loss on repurchase/redemption/amendment of debt securities | 1 | 0 |
(Decrease) increase in deferred taxes | (32) | 53 |
Changes in operating assets and liabilities, net of amounts acquired: | ||
Decrease (increase) in accounts receivable | 66 | (115) |
(Increase) decrease in inventory | (7) | 5 |
(Increase) decrease in prepaid expenses and other assets | (90) | 134 |
Increase in accounts payable | 250 | 205 |
Decrease in accrued expenses and other liabilities | (147) | (145) |
Net cash provided by operating activities | 2,294 | 2,228 |
Cash Flows From Investing Activities: | ||
Payments for purchases of rental equipment | (1,866) | (2,048) |
Payments for purchases of non-rental equipment and intangible assets | (165) | (179) |
Proceeds from sales of rental equipment | 748 | 770 |
Proceeds from sales of non-rental equipment | 30 | 28 |
Insurance proceeds from damaged equipment | 24 | 19 |
Purchases of other companies, net of cash acquired | (1,234) | (418) |
Purchases of investments | (3) | 0 |
Net cash used in investing activities | (2,466) | (1,828) |
Cash Flows From Financing Activities: | ||
Proceeds from debt | 6,911 | 4,488 |
Payments of debt | (5,597) | (4,007) |
Common stock repurchased, including tax withholdings for share based compensation | (791) | (554) |
Payments of financing costs | (17) | 0 |
Dividends paid | (219) | (205) |
Net cash provided by (used in) financing activities | 287 | (278) |
Effect of foreign exchange rates | (11) | (1) |
Net increase in cash and cash equivalents | 104 | 121 |
Cash and cash equivalents at beginning of period | 363 | 106 |
Cash and cash equivalents at end of period | 467 | 227 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes, net | 606 | 212 |
Cash paid for interest | $ 317 | $ 305 |
Organization, Description of Bu
Organization, Description of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Description of Business and Basis of Presentation | Organization, Description of Business and Basis of Presentation United Rentals, Inc. (“Holdings,” “URI” or the “Company”) is principally a holding company and conducts its operations primarily through its wholly owned subsidiary, United Rentals (North America), Inc. (“URNA”), and subsidiaries of URNA. Holdings’ primary asset is its sole ownership of all issued and outstanding shares of common stock of URNA. URNA’s various credit agreements and debt instruments place restrictions on its ability to transfer funds to its shareholder. We rent equipment to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. We primarily operate in the United States and Canada, and have a limited presence in Europe, Australia and New Zealand. In addition to renting equipment, we sell new and used rental equipment, as well as related contractor supplies, parts and service. We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the accounting policies described in our annual report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”) and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the 2023 Form 10-K. In our opinion, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented have been made. Interim results of operations are not necessarily indicative of the results of the full year. New Accounting Pronouncements Improvements to Reportable Segment Disclosures. In November 2023, the FASB issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in the ASU require, among other things, disclosure of significant segment expenses that are regularly provided to an entity's chief operating decision maker (“CODM”) and a description of other segment items (the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss) by reportable segment, as well as disclosure of the title and position of the CODM, and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. Annual disclosures are required for fiscal years beginning after December 15, 2023 and interim disclosures are required for periods within fiscal years beginning after December 15, 2024. Retrospective application is required, and early adoption is permitted. These requirements are not expected to have an impact on our financial statements, but will result in significantly expanded reportable segment disclosures. Improvements to Income Tax Disclosures. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Revenue Recognition Accounting Standards We recognize revenue in accordance with two different accounting standards: 1) Topic 606 (which addresses revenue from contracts with customers) and 2) Topic 842 (which addresses lease revenue). Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. As reflected below, most of our revenue is accounted for under Topic 842. Our contracts with customers generally do not include multiple performance obligations. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services. Nature of goods and services In the following table, revenue is summarized by type and by the applicable accounting standard. Three Months Ended June 30, 2024 2023 Topic 842 Topic 606 Total Topic 842 Topic 606 Total Revenues: Owned equipment rentals $ 2,604 $ — $ 2,604 $ 2,461 $ — $ 2,461 Re-rent revenue 58 — 58 56 — 56 Ancillary and other rental revenues: Delivery and pick-up — 267 267 — 238 238 Other 241 45 286 185 41 226 Total ancillary and other rental revenues 241 312 553 185 279 464 Total equipment rentals 2,903 312 3,215 2,702 279 2,981 Sales of rental equipment — 365 365 — 382 382 Sales of new equipment — 61 61 — 70 70 Contractor supplies sales — 42 42 — 37 37 Service and other revenues — 90 90 — 84 84 Total revenues $ 2,903 $ 870 $ 3,773 $ 2,702 $ 852 $ 3,554 Six Months Ended June 30, 2024 2023 Topic 842 Topic 606 Total Topic 842 Topic 606 Total Revenues: Owned equipment rentals $ 5,008 $ — $ 5,008 $ 4,727 $ — $ 4,727 Re-rent revenue 113 — 113 108 — 108 Ancillary and other rental revenues: Delivery and pick-up — 481 481 — 441 441 Other 442 100 542 350 95 445 Total ancillary and other rental revenues 442 581 1,023 350 536 886 Total equipment rentals 5,563 581 6,144 5,185 536 5,721 Sales of rental equipment — 748 748 — 770 770 Sales of new equipment — 109 109 — 114 114 Contractor supplies sales — 78 78 — 71 71 Service and other revenues — 179 179 — 163 163 Total revenues $ 5,563 $ 1,695 $ 7,258 $ 5,185 $ 1,654 $ 6,839 Revenues by reportable segment are presented in note 4 of the condensed consolidated financial statements, using the revenue captions reflected in our condensed consolidated statements of operations. The majority of our revenue is recognized in our general rentals segment and in the U.S. (for the six months ended June 30, 2024, 72 percent and 91 percent, respectively). We believe that the disaggregation of our revenue from contracts to customers as reflected above, coupled with the further discussion below and the reportable segment disclosures in note 4, depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Lease revenues (Topic 842) The accounting for the types of revenue that are accounted for under Topic 842 is discussed below. Owned equipment rentals represent our most significant revenue type (they accounted for 69 percent of total revenues for the six months ended June 30, 2024) and are governed by our standard rental contract. We account for such rentals as operating leases. The lease terms are included in our contracts, and the determination of whether our contracts contain leases generally does not require significant assumptions or judgments. Our lease revenues do not include material amounts of variable payments. Owned equipment rentals: Owned equipment rentals represent revenues from renting equipment that we own. We do not generally provide an option for the lessee to purchase the rented equipment at the end of the lease, and do not generate material revenue from sales of equipment under such options. We recognize revenues from renting equipment on a straight-line basis. Our rental contract periods are hourly, daily, weekly or monthly. By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day. The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days. This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply. As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, we will have customers return equipment and be contractually required to pay us more than the cumulative amount of revenue recognized to date under the straight-line methodology. For instance, continuing the above example, if the customer rented the above piece of equipment on December 29 and returned it at the close of business on January 1, we would recognize incremental revenue on January 1 of $171.44 (in actual dollars, representing the difference between the amount the customer is contractually required to pay, or $300 at the weekly rate, and the cumulative amount recognized to date on a straight-line basis, or $128.56, which represents four days at $32.14 per day). We record amounts billed to customers in excess of recognizable revenue as deferred revenue on our balance sheet. We had deferred revenue (associated with both Topic 842 and Topic 606) of $155 and $138 as of June 30, 2024 and December 31, 2023, respectively. As noted above, we are unsure of when the customer will return rented equipment. As such, we do not know how much the customer will owe us upon return of the equipment and cannot provide a maturity analysis of future lease payments. Our equipment is generally rented for short periods of time. Lessees do not provide residual value guarantees on rented equipment. We expect to derive significant future benefits from our equipment following the end of the rental term. Our rentals are generally short-term in nature, and our equipment is typically rented for the majority of the time that we own it. We additionally recognize revenue from sales of rental equipment when we dispose of the equipment. Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above. “Other” equipment rental revenue is primarily comprised of 1) Rental Protection Plan (or "RPP") revenue associated with the damage waiver customers can purchase when they rent our equipment to protect against potential loss or damage, 2) environmental charges associated with the rental of equipment, 3) charges for rented equipment that is damaged by our customers and 4) charges for setup and other services performed on rented equipment. Revenues from contracts with customers (Topic 606) The accounting for the types of revenue that are accounted for under Topic 606 is discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time. Delivery and pick-up: Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed. “Other” equipment rental revenue is primarily comprised of revenues associated with the consumption of fuel by our customers which are recognized when the equipment is returned by the customer (and consumption, if any, can be measured). Sales of rental equipment, new equipment and contractor supplies are recognized at the time of delivery to, or pick-up by, the customer and when collectibility is probable. Service and other revenues primarily represent revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). Service revenue is recognized as the services are performed. Receivables and contract assets and liabilities As reflected above, most of our equipment rental revenue is accounted for under Topic 842 (such revenue represented 77 percent of our total revenues for the six months ended June 30, 2024). The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. Because the same customers generate the revenues that are accounted for under both Topic 606 and Topic 842, the discussions below on credit risk and our allowance for credit losses address receivables arising from revenues from both Topic 606 and Topic 842. Concentration of credit risk with respect to our receivables is limited because a large number of geographically diverse customers makes up our customer base. Our largest customer accounted for one percent or less of total revenues for the six months ended June 30, 2024, and for each of the last three full years. Our customer with the largest receivable balance represented approximately one percent of total receivables at June 30, 2024 and December 31, 2023. We manage credit risk through credit approvals, credit limits and other monitoring procedures. Our allowance for credit losses reflects our estimate of the amount of our receivables that we will be unable to collect based on historical write-off experience and, as applicable, current conditions and reasonable and supportable forecasts that affect collectibility. Our estimate could require change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance. Trade receivables that have contractual maturities of one year or less are written-off when they are determined to be uncollectible based on the criteria necessary to qualify as a deduction for federal tax purposes. Write-offs of such receivables require management approval based on specified dollar thresholds. See the table below for a rollforward of our allowance for credit losses. The measurement of expected credit losses is based on relevant information from past events, including historical experiences, current conditions and reasonable and supportable forecasts that affect collectibility. Trade receivables are the only material financial asset we have that is subject to the requirement to measure expected credit losses as noted above, as this requirement does not apply to receivables arising from operating lease revenues. Substantially all of our non-lease trade receivables are due in one year or less. As discussed above, most of our equipment rental revenue is accounted for as lease revenue (such revenue represented 77 percent of our total revenues for the six months ended June 30, 2024, and these revenues account for corresponding portions of the $2.260 billion of net accounts receivable and the associated allowance for credit losses of $176 as of June 30, 2024). As discussed above, most of our equipment rental revenue is accounted for under Topic 842. The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. The rollforward of our allowance for credit losses (in total, and associated with revenues arising from both Topic 606 and Topic 842) is shown below. Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Six Months Ended June 30, 2024 Six Months Ended June 30, 2023 Beginning balance $ 174 $ 146 $ 169 $ 134 Charged to costs and expenses (1) 3 2 7 5 Charged to revenue (2) 14 8 23 21 Deductions and other (3) (15) (9) (23) (13) Ending balance $ 176 $ 147 $ 176 $ 147 _________________ (1) Reflects bad debt expenses recognized within selling, general and administrative expenses (associated with Topic 606 revenues). (2) Primarily reflects credit losses associated with lease revenues that were recognized as a reduction to equipment rentals revenue (primarily associated with Topic 842 revenues). (3) Primarily represents write-offs of accounts, net of immaterial recoveries and other activity. We do not have material contract assets, or impairment losses associated therewith, or material contract liabilities, associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenue during the three or six months ended June 30, 2024 or 2023 that was included in the contract liability balance as of the beginning of such periods. Performance obligations Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amounts of such revenue recognized during the three and six months ended June 30, 2024 and 2023 were not material. We also do not expect to recognize material revenue in the future related to performance obligations that were unsatisfied (or partially unsatisfied) as of June 30, 2024. Payment terms Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk. Revenue is recognized net of taxes collected from customers, which are subsequently remitted to governmental authorities. Contract costs We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Contract estimates and judgments Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments, primarily for the following reasons: • The transaction price is generally fixed and stated in our contracts; • As noted above, our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation; • Our revenues do not include material amounts of variable consideration, or result in significant obligations associated with returns, refunds or warranties; and • Most of our revenue is recognized as of a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenue is generally recognized at the time of delivery to, or pick-up by, the customer. Our revenues accounted for under Topic 842 also generally do not require significant estimates or judgments. We monitor and review our estimated standalone selling prices on a regular basis. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Acquisitions | Acquisitions On March 15, 2024, we completed the acquisition of Yak Access, LLC, Yak Mat, LLC and New South Access & Environmental Solutions, LLC (collectively, “Yak”). Yak was a leader in the North American matting industry with a fleet of approximately 600,000 hardwood, softwood, and composite mats that provide surface protection across both construction and maintenance, repair and operations (“MRO”) applications, and served customers primarily in the industrial sector across over 40 states. The acquisition is expected to: • Provide entry into the matting market via an industry leader with established scale across fleet, operations, and talent; • Augment exposure to the energy and power verticals, where significant investment is expected over the next several decades; and • Enhance our one-stop-shop value proposition with immediate cross-selling opportunities to existing and new construction and MRO customers. The acquisition date fair value of the purchase price to acquire Yak was $1.156 billion, comprised of cash and $39 of estimated contingent consideration ($50 is the maximum amount of contingent consideration) that could become payable to the seller based on revenue attainment in the first two years after closing. The acquisition and related fees and expenses were funded through the issuance of $1.100 billion principal amount of 6 1 / 8 Senior Notes (see note 7 to the condensed consolidated financial statements for further information) and drawings on our senior secured asset-based revolving credit facility (“ABL facility”). The following table summarizes the net book values of the assets acquired and liabilities assumed as of the acquisition date. The initial accounting for the acquisition is incomplete, principally related to finalizing 1) the measurement of the acquired net working capital, 2) the valuation of the acquired equipment (inclusive of the completion of our usual and customary procedures to validate the existence of the acquired rental fleet) and intangible assets, 3) the impact of lease accounting, 4) the valuation of the contingent consideration noted above and 5) the associated income tax considerations. All amounts below could change, potentially materially, as there is significant additional information that we must obtain to finalize the valuations of the assets acquired and liabilities assumed. During the three months ended June 30, 2024, we recognized measurement period adjustments primarily to establish preliminary values for intangibles assets, which also resulted in a reduction in goodwill from the previously reported preliminary amount. Accounts receivable (1) $ 99 Inventory 8 Rental equipment 143 Property and equipment 32 Intangible assets (customer relationships) (2) 150 Operating lease right-of-use assets 6 Other assets 17 Total identifiable assets acquired 455 Accounts payable, accrued expenses and other liabilities (103) Operating lease liabilities (6) Total liabilities assumed (109) Net identifiable assets acquired 346 Goodwill (3) 810 Net assets acquired $ 1,156 ___________________ (1) The estimated fair value of accounts receivables acquired was $99, and the gross contractual amount was $102. We estimated that $3 would be uncollectible. (2) The customer relationships are being amortized over a 6 year life. (3) All of the goodwill was assigned to our specialty segment. As noted above, we have not yet obtained all the information required to finalize the valuations of the assets acquired and liabilities assumed. As such, we expect that goodwill will change from the amount noted above. Once finalized, we expect that the goodwill that results from the acquisition will be primarily reflective of Yak's going-concern value, the value of Yak's assembled workforce and new customer relationships expected to arise from the acquisition. All of the goodwill is expected to be deductible for income tax purposes (because the acquired Yak entities were sold as disregarded entities, the acquisition was treated as an asset purchase for income tax purposes, which resulted in the goodwill that is deductible for income tax purposes equaling the total acquired goodwill). The debt issuance costs associated with the issuance of debt to partially fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our consolidated balance sheets. The total post-acquisition revenue attributable to the acquired Yak locations was $87 and $102 for the three and six months ended June 30, 2024, respectively. It is not practicable to reasonably estimate the amount of earnings of Yak since the acquisition date, primarily due to our corporate structure and the allocation of corporate costs. Pro forma financial information The pro forma information below gives effect to the Yak acquisition as if it had been completed on January 1, 2023. Pro forma information for the three months ended June 30, 2024 is excluded from the presentation below because Yak was included in our results for the entire period. The pro forma information is not necessarily indicative of our results had the acquisition been completed on the above date, nor is it necessarily indicative of our future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and also does not reflect additional revenue opportunities following the acquisition. The pro forma information includes adjustments to record the acquired assets and liabilities of Yak at their respective fair values and to give effect to the financing for the acquisition. The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed. The purchase price allocations for the assets acquired and liabilities assumed are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact our statements of income in future periods. The table below presents unaudited pro forma consolidated income statement information as if Yak had been included in our consolidated results for the entire periods reflected: Three Months Ended Six Months Ended June 30, June 30, 2023 2024 2023 United Rentals historic revenue (1) $ 3,554 $ 7,258 $ 6,839 Yak historic revenue (2) 93 97 184 Pro forma revenue (1) 3,647 7,355 7,023 United Rentals historic pretax income 772 1,530 1,366 Yak historic pretax (loss) income (9) 10 77 Combined pretax income 763 1,540 1,443 Pro forma adjustments to combined pretax income: Impact of fair value mark-ups/useful life changes on depreciation (3) (2) (1) (4) Intangible asset amortization (4) (4) (2) (9) Interest expense (5) (17) (14) (34) Elimination of historic interest (6) 16 11 39 Elimination of refinancing transactions (7) 1 (40) (101) Transaction bonuses and other (8) 1 22 2 Pro forma pretax income $ 758 $ 1,516 $ 1,336 ___________________ (1) United Rentals historic revenue for the six months ended June 30, 2024 includes the post-acquisition revenue attributable to the acquired Yak locations of $102 that is discussed above. Pro forma revenue for the six months ended June 30, 2024 includes $199 of pre/post-acquisition revenue from the acquired Yak locations, comprised of $97 of historic Yak revenue and $102 of post-acquisition revenue attributable to the acquired Yak locations. (2) Yak revenue reflects only the historical results of the entities being acquired, and includes an estimate of revenue from mat rentals to a commonly controlled entity that were eliminated in consolidation by Yak. (3) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of the equipment acquired in the Yak acquisition. There were no material changes to the useful lives and salvage values of the acquired equipment. (4) Intangible asset amortization was adjusted to include amortization of the acquired intangible assets. (5) As discussed above, the acquisition and related fees and expenses were funded through the issuance of senior notes and drawings on our ABL facility. Interest expense was adjusted to reflect interest on the debt used to finance the acquisition. (6) Historic interest on debt that is not part of the combined entity was eliminated. (7) Reflects gains on the extinguishment of debt, net of refinancing transaction expenses. (8) Primarily reflects bonuses paid in connection with the acquisition. During 2024 and 2023, we completed other acquisitions that were not significant individually or in the aggregate. See the condensed consolidated statements of cash flows for the total cash outflow for purchases of other companies (including Yak), net of cash acquired. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Our reportable segments are i) general rentals and ii) specialty. For general rentals, the divisions discussed below, which are our operating segments, are aggregated into the reportable segment. The specialty segment is a single division that is both an operating segment and a reportable segment. We believe that the divisions that are aggregated into our reportable segments have similar economic characteristics, as each division is capital intensive, offers similar products to similar customers, uses similar methods to distribute its products, and is subject to similar competitive risks. The aggregation of our divisions also reflects the management structure that we use for making operating decisions and assessing performance. We evaluate segment performance primarily based on segment equipment rentals gross profit. The general rentals segment includes the rental of i) general construction and industrial equipment, such as backhoes, skid-steer loaders, forklifts, earthmoving equipment and material handling equipment, ii) aerial work platforms, such as boom lifts and scissor lifts and iii) general tools and light equipment, such as pressure washers, water pumps and power tools. The general rentals segment reflects the aggregation of four geographic divisions—Central, Northeast, Southeast and West—and operates throughout the United States and Canada. The specialty segment, which, as noted above, is a single division that is both an operating segment and a reportable segment, rents products (and provides setup and other services on such rented equipment) including i) trench safety equipment, such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, ii) power and HVAC equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment, iii) fluid solutions equipment primarily used for fluid containment, transfer and treatment, iv) mobile storage equipment and modular office space and v) surface protection mats. The specialty segment’s customers include construction companies involved in infrastructure projects, municipalities and industrial companies. This segment primarily operates in the United States and Canada, and has a limited presence in Europe, Australia and New Zealand. The following tables set forth financial information by segment. General Specialty Total Three Months Ended June 30, 2024 Equipment rentals $ 2,209 $ 1,006 $ 3,215 Sales of rental equipment 313 52 365 Sales of new equipment 27 34 61 Contractor supplies sales 23 19 42 Service and other revenues 81 9 90 Total revenue 2,653 1,120 3,773 Depreciation and amortization expense 541 176 717 Equipment rentals gross profit 802 483 1,285 Three Months Ended June 30, 2023 Equipment rentals $ 2,189 $ 792 $ 2,981 Sales of rental equipment 342 40 382 Sales of new equipment 24 46 70 Contractor supplies sales 23 14 37 Service and other revenues 75 9 84 Total revenue 2,653 901 3,554 Depreciation and amortization expense 580 116 696 Equipment rentals gross profit 788 385 1,173 Six Months Ended June 30, 2024 Equipment rentals $ 4,279 $ 1,865 $ 6,144 Sales of rental equipment 659 89 748 Sales of new equipment 56 53 109 Contractor supplies sales 43 35 78 Service and other revenues 162 17 179 Total revenue 5,199 2,059 7,258 Depreciation and amortization expense 1,115 288 1,403 Equipment rentals gross profit 1,483 905 2,388 Capital expenditures (1) 1,658 523 2,181 Six Months Ended June 30, 2023 Equipment rentals $ 4,207 $ 1,514 $ 5,721 Sales of rental equipment 692 78 770 Sales of new equipment 42 72 114 Contractor supplies sales 44 27 71 Service and other revenues 147 16 163 Total revenue 5,132 1,707 6,839 Depreciation and amortization expense 1,157 232 1,389 Equipment rentals gross profit 1,451 725 2,176 Capital expenditures (1) 1,766 461 2,227 ___________________ (1) The condensed consolidated statements of cash flows include the payments for capital expenditures, while the table above reflects the gross capital expenditures. Accounts payable as of June 30, 2024 and December 31, 2023 included $224 and $74, respectively, of amounts due but unpaid for purchases of rental equipment. The net impact of accrued purchases of rental equipment was not material for the six months ended June 30, 2023. June 30, December 31, Total reportable segment assets General rentals $ 20,804 $ 20,411 Specialty (1) 6,809 5,178 Total assets $ 27,613 $ 25,589 ___________________ (1) The increase in the specialty segment assets primarily reflects the impact of the Yak acquisition discussed in note 3 to the condensed consolidated financial statements. Equipment rentals gross profit is the primary measure management reviews to make operating decisions and assess segment performance. The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes: Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Total equipment rentals gross profit $ 1,285 $ 1,173 $ 2,388 $ 2,176 Gross profit from other lines of business 233 252 476 490 Selling, general and administrative expenses (404) (378) (793) (760) Restructuring charge (1) (1) (18) (2) (19) Non-rental depreciation and amortization (109) (104) (213) (222) Interest expense, net (173) (161) (333) (311) Other income, net 4 8 7 12 Income before provision for income taxes $ 835 $ 772 $ 1,530 $ 1,366 ___________________ (1) Primarily reflects severance and branch closure charges associated with our restructuring programs. The restructuring charges generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition. The amounts above primarily reflect charges associated with the restructuring program initiated following the December 2022 acquisition of Ahern Rentals, Inc. As of June 30, 2024, there were no open restructuring programs. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The following table presents the changes in the carrying amount of goodwill for the six months ended June 30, 2024: General rentals Specialty Total Balance at January 1, 2024 (1) $ 4,775 $ 1,165 $ 5,940 Goodwill related to acquisitions (2) 5 820 825 Foreign currency translation and other adjustments (7) (9) (16) Balance at June 30, 2024 (1) $ 4,773 $ 1,976 $ 6,749 _________________ (1) The total carrying amount of goodwill for all periods in the table above is reflected net of $1.557 billion of accumulated impairment charges, which were primarily recorded in our general rentals segment. (2) Includes goodwill adjustments for the effect on goodwill of changes to net assets acquired during the measurement period. The goodwill related to acquisitions above primarily reflects the March 2024 acquisition of Yak, which is discussed note 3 to our condensed consolidated financial statements. Other intangible assets were comprised of the following at June 30, 2024 and December 31, 2023: June 30, 2024 Weighted-Average Remaining Gross Accumulated Net Non-compete agreements 3 years $ 169 $ 70 $ 99 Customer relationships 6 years $ 2,666 $ 2,023 $ 643 Trade names and associated trademarks 2 years $ 8 $ 6 $ 2 December 31, 2023 Weighted-Average Remaining Gross Accumulated Net Non-compete agreements 4 years $ 176 $ 58 $ 118 Customer relationships 6 years $ 2,468 $ 1,919 $ 549 Trade names and associated trademarks 2 years $ 9 $ 6 $ 3 Our other intangibles assets, net at June 30, 2024 includes the assets in the table below associated with the acquisition of Yak that is discussed in note 3 to our condensed consolidated financial statements. No residual value has been assigned to these assets. The customer relationships are being amortized using the sum of the years' digits method, and we believe that this method best reflects the estimated pattern in which the economic benefits will be consumed. The intangible asset values are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period. June 30, 2024 Weighted-Average Remaining Net Carrying Customer relationships 6 years 139 Amortization expense for other intangible assets was $66 and $65 for the three months ended June 30, 2024 and 2023, respectively, and $126 and $144 for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, estimated amortization expense for other intangible assets for each of the next five years and thereafter is as follows: 2024 $ 125 2025 213 2026 162 2027 111 2028 61 Thereafter 72 Total $ 744 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements As of June 30, 2024 and December 31, 2023, the amounts of our assets and liabilities that were accounted for at fair value were immaterial. Fair value measurements are categorized in one of the following three levels based on the lowest level input that is significant to the fair value measurement in its entirety: Level 1- Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities. Level 2- Observable inputs other than quoted prices in active markets for identical assets or liabilities include: a) quoted prices for similar assets or liabilities in active markets; b) quoted prices for identical or similar assets or liabilities in inactive markets; c) inputs other than quoted prices that are observable for the asset or liability; d) inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability. Level 3- Inputs to the valuation methodology are unobservable (i.e., supported by little or no market activity) and significant to the fair value measure. Fair Value of Financial Instruments The carrying amounts reported in our condensed consolidated balance sheets for accounts receivable, accounts payable and accrued expenses and other liabilities approximate fair value due to the immediate to short-term maturity of these financial instruments. The fair values of our variable rate debt facilities and finance leases approximated their book values as of June 30, 2024 and December 31, 2023. The estimated fair values of our other financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of June 30, 2024 and December 31, 2023 have been calculated based upon available market information, and were as follows: June 30, 2024 December 31, 2023 Carrying Fair Carrying Fair Senior notes $ 8,817 $ 8,459 $ 7,720 $ 7,442 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following: June 30, 2024 December 31, 2023 Repurchase facility (terminated in 2024) (1) $ — $ 100 Accounts receivable securitization facility expiring 2025 (1) (2) 1,289 1,300 $4.25 billion ABL facility expiring 2027 (1) 1,571 1,261 Term loan facility expiring 2031 (1) (3) 988 945 5 1 / 2 percent Senior Notes due 2027 499 498 3 7 / 8 percent Senior Secured Notes due 2027 746 745 4 7 / 8 percent Senior Notes due 2028 (4) 1,666 1,665 6 percent Senior Secured Notes due 2029 1,489 1,488 5 1 / 4 percent Senior Notes due 2030 745 745 4 percent Senior Notes due 2030 745 744 3 7 / 8 percent Senior Notes due 2031 1,092 1,091 3 3 / 4 percent Senior Notes due 2032 745 744 6 1 / 8 percent Senior Notes due 2034 (5) 1,090 — Finance leases 224 192 Total debt 12,889 11,518 Less short-term portion (6) (1,369) (1,465) Total long-term debt $ 11,520 $ 10,053 ___________________ (1) The table below presents financial information associated with our variable rate indebtedness as of and for the six months ended June 30, 2024. The repurchase facility is not included below because (i) there were no borrowings under it during the six months ended June 30, 2024 and (ii) it was terminated in May 2024. We have borrowed the full available amount under the term loan facility. The principal obligation under the term loan facility is required to be repaid in quarterly installments in an aggregate amount equal to 1.0 percent per annum, with the balance due at the maturity of the facility. The average amount of debt outstanding under the term loan facility decreases slightly each quarter due to the requirement to repay a portion of the principal obligation. ABL facility Accounts receivable securitization facility Term loan facility Borrowing capacity, net of letters of credit $ 2,653 $ 147 $ — Letters of credit 18 Interest rate at June 30, 2024 6.5 % 6.3 % 7.1 % Average month-end debt outstanding 1,354 1,156 991 Weighted-average interest rate on average debt outstanding 6.5 % 6.3 % 7.1 % Maximum month-end debt outstanding 1,578 1,290 1,000 (2) In May 2024, the accounts receivable securitization facility was amended, primarily to increase the facility size and extend the maturity date. The size of the facility, which expires on June 24, 2025, was increased to $1.5 billion. The facility may be extended on a 364-day basis by mutual agreement with the purchasers under the facility. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of June 30, 2024, there were $1.437 billion of receivables, net of applicable reserves and other deductions, in the collateral pool. (3) In February 2024, the term loan facility was amended, primarily to extend the maturity date to February 14, 2031 and to increase the facility size to $1.000 billion (at the time of the amendment, the facility size was $948). (4) URNA separately issued 4 7 / 8 percent Senior Notes in August 2017 and in September 2017. Following the issuances, URNA consummated an exchange offer pursuant to which most of the 4 7 / 8 percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 7 / 8 percent Senior Notes issued in August 2017. As of June 30, 2024, the total above is comprised of two separate 4 7 / 8 percent Senior Notes, one with a book value of $1.662 billion and one with a book value of $4. (5) In March 2024, URNA issued $1.100 billion aggregate principal amount of 6 1 / 8 percent Senior Notes (the “6 1 / 8 percent Notes”) which are due March 15, 2034. The 6 1 / 8 percent Notes are unsecured and are guaranteed by Holdings and certain domestic subsidiaries of URNA. The 6 1 / 8 percent Notes may be redeemed on or after March 15, 2029, at specified redemption prices that range from 103.063 percent in 2029, to 100 percent in 2032 and thereafter, in each case, plus accrued and unpaid interest, if any. At any time prior to March 15, 2029, URNA may, at its option, redeem some or all of the 6 1 / 8 percent Notes at a redemption price equal to 100 percent of the aggregate principal amount of the notes to be redeemed, plus a “make-whole” premium and accrued and unpaid interest, if any, to the redemption date. In addition, at any time on or prior to March 15, 2027, up to 40 percent of the aggregate principal amount of the 6 1 / 8 percent Notes may be redeemed with the net cash proceeds of certain equity offerings at a redemption price equal to 106.125 percent of the aggregate principal amount of the notes plus accrued and unpaid interest, if any. The indenture governing the 6 1 / 8 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and consolidations, as well as a requirement to timely file periodic reports with the SEC. Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions. In addition, the requirements to provide subsidiary guarantees and to make an offer to repurchase the notes upon the occurrence of a change of control will not apply to URNA and its restricted subsidiaries during any period when the 6 1 / 8 percent Notes are rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA, provided at such time no default under the indenture has occurred and is continuing. The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding 6 1 / 8 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon. (6) Short-term debt primarily reflects borrowings under the accounts receivable securitization facility and the repurchase facility that was terminated in May 2024, and the short-term portion of our finance leases. Loan Covenants and Compliance As of June 30, 2024, we were in compliance with the covenants and other provisions of the ABL, accounts receivable securitization and term loan facilities and our senior notes. Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations. The only financial covenant that currently exists under the ABL facility is the fixed charge coverage ratio. Subject to certain limited exceptions specified in the ABL facility, the fixed charge coverage ratio covenant under the ABL facility will only apply in the future if specified availability under the ABL facility falls below 10 percent of the maximum revolver amount under the ABL facility. When certain conditions are met, cash and cash equivalents and borrowing base collateral in excess of the ABL facility size may be included when calculating specified availability under the ABL facility. As of June 30, 2024, specified availability under the ABL facility exceeded the required threshold and, as a result, this financial covenant was inapplicable. Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to: (i) the default ratio, (ii) the delinquency ratio, (iii) the dilution ratio and (iv) days sales outstanding. The accounts receivable securitization facility also requires us to comply with the fixed charge coverage ratio under the ABL facility, to the extent the ratio is applicable under the ABL facility. Covenants in the agreements governing our ABL facility, term loan facility and certain other debt instruments impose limitations on our ability to make share repurchases and dividend payments, subject to important exceptions that would allow us to make such repurchases or payments under certain conditions. Based on our current total indebtedness leverage ratio (as defined in the applicable debt agreements) and usage of the ABL facility as of June 30, 2024, we met the criteria under the applicable debt agreements for these exceptions, and as a result we were not restricted in our ability to make share repurchases and dividend payments. |
Legal and Regulatory Matters
Legal and Regulatory Matters | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal and Regulatory Matters | Legal and Regulatory Matters We are subject to a number of claims and proceedings that generally arise in the ordinary conduct of our business. These matters include, but are not limited to, general liability claims (including personal injury, product liability, and property and automobile claims), indemnification and guarantee obligations, employee injuries and employment-related claims, self-insurance obligations and contract and real estate matters. Based on advice of counsel and available information, including current status or stage of proceeding, and taking into account accruals included in our consolidated balance sheets for matters where we have established them, we currently believe that any liabilities ultimately resulting from these ordinary course claims and proceedings will not, individually or in the aggregate, have a material adverse effect on our consolidated financial position, results of operations or cash flows. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares plus the effect of dilutive potential common shares outstanding during the period. The following table sets forth the computation of basic and diluted earnings per share (shares in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Numerator: Net income available to common stockholders $ 636 $ 591 1,178 1,042 Denominator: Denominator for basic earnings per share—weighted-average common shares 66,563 68,718 66,888 69,064 Effect of dilutive securities: Employee stock options 2 4 3 4 Restricted stock units 147 119 173 223 Denominator for diluted earnings per share—adjusted weighted-average common shares 66,712 68,841 67,064 69,291 Basic earnings per share $ 9.56 $ 8.60 $ 17.62 $ 15.09 Diluted earnings per share $ 9.54 $ 8.58 $ 17.57 $ 15.04 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 636 | $ 591 | $ 1,178 | $ 1,042 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Organization, Description of _2
Organization, Description of Business and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Improvements to Reportable Segment Disclosures. In November 2023, the FASB issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in the ASU require, among other things, disclosure of significant segment expenses that are regularly provided to an entity's chief operating decision maker (“CODM”) and a description of other segment items (the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss) by reportable segment, as well as disclosure of the title and position of the CODM, and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. Annual disclosures are required for fiscal years beginning after December 15, 2023 and interim disclosures are required for periods within fiscal years beginning after December 15, 2024. Retrospective application is required, and early adoption is permitted. These requirements are not expected to have an impact on our financial statements, but will result in significantly expanded reportable segment disclosures. Improvements to Income Tax Disclosures. |
Lease revenues (Topic 842) | Lease revenues (Topic 842) The accounting for the types of revenue that are accounted for under Topic 842 is discussed below. Owned equipment rentals represent our most significant revenue type (they accounted for 69 percent of total revenues for the six months ended June 30, 2024) and are governed by our standard rental contract. We account for such rentals as operating leases. The lease terms are included in our contracts, and the determination of whether our contracts contain leases generally does not require significant assumptions or judgments. Our lease revenues do not include material amounts of variable payments. Owned equipment rentals: Owned equipment rentals represent revenues from renting equipment that we own. We do not generally provide an option for the lessee to purchase the rented equipment at the end of the lease, and do not generate material revenue from sales of equipment under such options. We recognize revenues from renting equipment on a straight-line basis. Our rental contract periods are hourly, daily, weekly or monthly. By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day. The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days. This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply. As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, we will have customers return equipment and be contractually required to pay us more than the cumulative amount of revenue recognized to date under the straight-line methodology. For instance, continuing the above example, if the customer rented the above piece of equipment on December 29 and returned it at the close of business on January 1, we would recognize incremental revenue on January 1 of $171.44 (in actual dollars, representing the difference between the amount the customer is contractually required to pay, or $300 at the weekly rate, and the cumulative amount recognized to date on a straight-line basis, or $128.56, which represents four days at $32.14 per day). We record amounts billed to customers in excess of recognizable revenue as deferred revenue on our balance sheet. We had deferred revenue (associated with both Topic 842 and Topic 606) of $155 and $138 as of June 30, 2024 and December 31, 2023, respectively. As noted above, we are unsure of when the customer will return rented equipment. As such, we do not know how much the customer will owe us upon return of the equipment and cannot provide a maturity analysis of future lease payments. Our equipment is generally rented for short periods of time. Lessees do not provide residual value guarantees on rented equipment. We expect to derive significant future benefits from our equipment following the end of the rental term. Our rentals are generally short-term in nature, and our equipment is typically rented for the majority of the time that we own it. We additionally recognize revenue from sales of rental equipment when we dispose of the equipment. Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above. “Other” equipment rental revenue is primarily comprised of 1) Rental Protection Plan (or "RPP") revenue associated with the damage waiver customers can purchase when they rent our equipment to protect against potential loss or damage, 2) environmental charges associated with the rental of equipment, 3) charges for rented equipment that is damaged by our customers and 4) charges for setup and other services performed on rented equipment. |
Revenues from contracts with customers (Topic 606) | Revenues from contracts with customers (Topic 606) The accounting for the types of revenue that are accounted for under Topic 606 is discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time. Delivery and pick-up: Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed. “Other” equipment rental revenue is primarily comprised of revenues associated with the consumption of fuel by our customers which are recognized when the equipment is returned by the customer (and consumption, if any, can be measured). Sales of rental equipment, new equipment and contractor supplies are recognized at the time of delivery to, or pick-up by, the customer and when collectibility is probable. Service and other revenues primarily represent revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). Service revenue is recognized as the services are performed. Receivables and contract assets and liabilities As reflected above, most of our equipment rental revenue is accounted for under Topic 842 (such revenue represented 77 percent of our total revenues for the six months ended June 30, 2024). The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. Because the same customers generate the revenues that are accounted for under both Topic 606 and Topic 842, the discussions below on credit risk and our allowance for credit losses address receivables arising from revenues from both Topic 606 and Topic 842. Concentration of credit risk with respect to our receivables is limited because a large number of geographically diverse customers makes up our customer base. Our largest customer accounted for one percent or less of total revenues for the six months ended June 30, 2024, and for each of the last three full years. Our customer with the largest receivable balance represented approximately one percent of total receivables at June 30, 2024 and December 31, 2023. We manage credit risk through credit approvals, credit limits and other monitoring procedures. Our allowance for credit losses reflects our estimate of the amount of our receivables that we will be unable to collect based on historical write-off experience and, as applicable, current conditions and reasonable and supportable forecasts that affect collectibility. Our estimate could require change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance. Trade receivables that have contractual maturities of one year or less are written-off when they are determined to be uncollectible based on the criteria necessary to qualify as a deduction for federal tax purposes. Write-offs of such receivables require management approval based on specified dollar thresholds. See the table below for a rollforward of our allowance for credit losses. The measurement of expected credit losses is based on relevant information from past events, including historical experiences, current conditions and reasonable and supportable forecasts that affect collectibility. Trade receivables are the only material financial asset we have that is subject to the requirement to measure expected credit losses as noted above, as this requirement does not apply to receivables arising from operating lease revenues. Substantially all of our non-lease trade receivables are due in one year or less. As discussed above, most of our equipment rental revenue is accounted for as lease revenue (such revenue represented 77 percent of our total revenues for the six months ended June 30, 2024, and these revenues account for corresponding portions of the $2.260 billion of net accounts receivable and the associated allowance for credit losses of $176 as of June 30, 2024). As discussed above, most of our equipment rental revenue is accounted for under Topic 842. The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. The rollforward of our allowance for credit losses (in total, and associated with revenues arising from both Topic 606 and Topic 842) is shown below. Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Six Months Ended June 30, 2024 Six Months Ended June 30, 2023 Beginning balance $ 174 $ 146 $ 169 $ 134 Charged to costs and expenses (1) 3 2 7 5 Charged to revenue (2) 14 8 23 21 Deductions and other (3) (15) (9) (23) (13) Ending balance $ 176 $ 147 $ 176 $ 147 _________________ (1) Reflects bad debt expenses recognized within selling, general and administrative expenses (associated with Topic 606 revenues). (2) Primarily reflects credit losses associated with lease revenues that were recognized as a reduction to equipment rentals revenue (primarily associated with Topic 842 revenues). (3) Primarily represents write-offs of accounts, net of immaterial recoveries and other activity. We do not have material contract assets, or impairment losses associated therewith, or material contract liabilities, associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenue during the three or six months ended June 30, 2024 or 2023 that was included in the contract liability balance as of the beginning of such periods. Performance obligations Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amounts of such revenue recognized during the three and six months ended June 30, 2024 and 2023 were not material. We also do not expect to recognize material revenue in the future related to performance obligations that were unsatisfied (or partially unsatisfied) as of June 30, 2024. Payment terms Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk. Revenue is recognized net of taxes collected from customers, which are subsequently remitted to governmental authorities. Contract costs We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. Contract estimates and judgments Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments, primarily for the following reasons: • The transaction price is generally fixed and stated in our contracts; • As noted above, our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation; • Our revenues do not include material amounts of variable consideration, or result in significant obligations associated with returns, refunds or warranties; and • Most of our revenue is recognized as of a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenue is generally recognized at the time of delivery to, or pick-up by, the customer. Our revenues accounted for under Topic 842 also generally do not require significant estimates or judgments. We monitor and review our estimated standalone selling prices on a regular basis. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Changes in Accounting Principles | In the following table, revenue is summarized by type and by the applicable accounting standard. Three Months Ended June 30, 2024 2023 Topic 842 Topic 606 Total Topic 842 Topic 606 Total Revenues: Owned equipment rentals $ 2,604 $ — $ 2,604 $ 2,461 $ — $ 2,461 Re-rent revenue 58 — 58 56 — 56 Ancillary and other rental revenues: Delivery and pick-up — 267 267 — 238 238 Other 241 45 286 185 41 226 Total ancillary and other rental revenues 241 312 553 185 279 464 Total equipment rentals 2,903 312 3,215 2,702 279 2,981 Sales of rental equipment — 365 365 — 382 382 Sales of new equipment — 61 61 — 70 70 Contractor supplies sales — 42 42 — 37 37 Service and other revenues — 90 90 — 84 84 Total revenues $ 2,903 $ 870 $ 3,773 $ 2,702 $ 852 $ 3,554 Six Months Ended June 30, 2024 2023 Topic 842 Topic 606 Total Topic 842 Topic 606 Total Revenues: Owned equipment rentals $ 5,008 $ — $ 5,008 $ 4,727 $ — $ 4,727 Re-rent revenue 113 — 113 108 — 108 Ancillary and other rental revenues: Delivery and pick-up — 481 481 — 441 441 Other 442 100 542 350 95 445 Total ancillary and other rental revenues 442 581 1,023 350 536 886 Total equipment rentals 5,563 581 6,144 5,185 536 5,721 Sales of rental equipment — 748 748 — 770 770 Sales of new equipment — 109 109 — 114 114 Contractor supplies sales — 78 78 — 71 71 Service and other revenues — 179 179 — 163 163 Total revenues $ 5,563 $ 1,695 $ 7,258 $ 5,185 $ 1,654 $ 6,839 |
SEC Schedule, 12-09, Schedule of Valuation and Qualifying Accounts Disclosure | The rollforward of our allowance for credit losses (in total, and associated with revenues arising from both Topic 606 and Topic 842) is shown below. Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Six Months Ended June 30, 2024 Six Months Ended June 30, 2023 Beginning balance $ 174 $ 146 $ 169 $ 134 Charged to costs and expenses (1) 3 2 7 5 Charged to revenue (2) 14 8 23 21 Deductions and other (3) (15) (9) (23) (13) Ending balance $ 176 $ 147 $ 176 $ 147 _________________ (1) Reflects bad debt expenses recognized within selling, general and administrative expenses (associated with Topic 606 revenues). (2) Primarily reflects credit losses associated with lease revenues that were recognized as a reduction to equipment rentals revenue (primarily associated with Topic 842 revenues). (3) Primarily represents write-offs of accounts, net of immaterial recoveries and other activity. |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | The following table summarizes the net book values of the assets acquired and liabilities assumed as of the acquisition date. The initial accounting for the acquisition is incomplete, principally related to finalizing 1) the measurement of the acquired net working capital, 2) the valuation of the acquired equipment (inclusive of the completion of our usual and customary procedures to validate the existence of the acquired rental fleet) and intangible assets, 3) the impact of lease accounting, 4) the valuation of the contingent consideration noted above and 5) the associated income tax considerations. All amounts below could change, potentially materially, as there is significant additional information that we must obtain to finalize the valuations of the assets acquired and liabilities assumed. During the three months ended June 30, 2024, we recognized measurement period adjustments primarily to establish preliminary values for intangibles assets, which also resulted in a reduction in goodwill from the previously reported preliminary amount. Accounts receivable (1) $ 99 Inventory 8 Rental equipment 143 Property and equipment 32 Intangible assets (customer relationships) (2) 150 Operating lease right-of-use assets 6 Other assets 17 Total identifiable assets acquired 455 Accounts payable, accrued expenses and other liabilities (103) Operating lease liabilities (6) Total liabilities assumed (109) Net identifiable assets acquired 346 Goodwill (3) 810 Net assets acquired $ 1,156 ___________________ (1) The estimated fair value of accounts receivables acquired was $99, and the gross contractual amount was $102. We estimated that $3 would be uncollectible. (2) The customer relationships are being amortized over a 6 year life. (3) All of the goodwill was assigned to our specialty segment. As noted above, we have not yet obtained all the information required to finalize the valuations of the assets acquired and liabilities assumed. As such, we expect that goodwill will change from the amount noted above. Once finalized, we expect that the goodwill that results from the acquisition will be |
Summary of Business Acquisition, Pro Forma Information | The table below presents unaudited pro forma consolidated income statement information as if Yak had been included in our consolidated results for the entire periods reflected: Three Months Ended Six Months Ended June 30, June 30, 2023 2024 2023 United Rentals historic revenue (1) $ 3,554 $ 7,258 $ 6,839 Yak historic revenue (2) 93 97 184 Pro forma revenue (1) 3,647 7,355 7,023 United Rentals historic pretax income 772 1,530 1,366 Yak historic pretax (loss) income (9) 10 77 Combined pretax income 763 1,540 1,443 Pro forma adjustments to combined pretax income: Impact of fair value mark-ups/useful life changes on depreciation (3) (2) (1) (4) Intangible asset amortization (4) (4) (2) (9) Interest expense (5) (17) (14) (34) Elimination of historic interest (6) 16 11 39 Elimination of refinancing transactions (7) 1 (40) (101) Transaction bonuses and other (8) 1 22 2 Pro forma pretax income $ 758 $ 1,516 $ 1,336 ___________________ (1) United Rentals historic revenue for the six months ended June 30, 2024 includes the post-acquisition revenue attributable to the acquired Yak locations of $102 that is discussed above. Pro forma revenue for the six months ended June 30, 2024 includes $199 of pre/post-acquisition revenue from the acquired Yak locations, comprised of $97 of historic Yak revenue and $102 of post-acquisition revenue attributable to the acquired Yak locations. (2) Yak revenue reflects only the historical results of the entities being acquired, and includes an estimate of revenue from mat rentals to a commonly controlled entity that were eliminated in consolidation by Yak. (3) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of the equipment acquired in the Yak acquisition. There were no material changes to the useful lives and salvage values of the acquired equipment. (4) Intangible asset amortization was adjusted to include amortization of the acquired intangible assets. (5) As discussed above, the acquisition and related fees and expenses were funded through the issuance of senior notes and drawings on our ABL facility. Interest expense was adjusted to reflect interest on the debt used to finance the acquisition. (6) Historic interest on debt that is not part of the combined entity was eliminated. (7) Reflects gains on the extinguishment of debt, net of refinancing transaction expenses. (8) Primarily reflects bonuses paid in connection with the acquisition. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Financial Information by Segment | The following tables set forth financial information by segment. General Specialty Total Three Months Ended June 30, 2024 Equipment rentals $ 2,209 $ 1,006 $ 3,215 Sales of rental equipment 313 52 365 Sales of new equipment 27 34 61 Contractor supplies sales 23 19 42 Service and other revenues 81 9 90 Total revenue 2,653 1,120 3,773 Depreciation and amortization expense 541 176 717 Equipment rentals gross profit 802 483 1,285 Three Months Ended June 30, 2023 Equipment rentals $ 2,189 $ 792 $ 2,981 Sales of rental equipment 342 40 382 Sales of new equipment 24 46 70 Contractor supplies sales 23 14 37 Service and other revenues 75 9 84 Total revenue 2,653 901 3,554 Depreciation and amortization expense 580 116 696 Equipment rentals gross profit 788 385 1,173 Six Months Ended June 30, 2024 Equipment rentals $ 4,279 $ 1,865 $ 6,144 Sales of rental equipment 659 89 748 Sales of new equipment 56 53 109 Contractor supplies sales 43 35 78 Service and other revenues 162 17 179 Total revenue 5,199 2,059 7,258 Depreciation and amortization expense 1,115 288 1,403 Equipment rentals gross profit 1,483 905 2,388 Capital expenditures (1) 1,658 523 2,181 Six Months Ended June 30, 2023 Equipment rentals $ 4,207 $ 1,514 $ 5,721 Sales of rental equipment 692 78 770 Sales of new equipment 42 72 114 Contractor supplies sales 44 27 71 Service and other revenues 147 16 163 Total revenue 5,132 1,707 6,839 Depreciation and amortization expense 1,157 232 1,389 Equipment rentals gross profit 1,451 725 2,176 Capital expenditures (1) 1,766 461 2,227 ___________________ (1) The condensed consolidated statements of cash flows include the payments for capital expenditures, while the table above reflects the gross capital expenditures. Accounts payable as of June 30, 2024 and December 31, 2023 included $224 and $74, respectively, of amounts due but unpaid for purchases of rental equipment. The net impact of accrued purchases of rental equipment was not material for the six months ended June 30, 2023. June 30, December 31, Total reportable segment assets General rentals $ 20,804 $ 20,411 Specialty (1) 6,809 5,178 Total assets $ 27,613 $ 25,589 ___________________ (1) |
Schedule of Reconciliation to Equipment Rentals Gross Profit | The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes: Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Total equipment rentals gross profit $ 1,285 $ 1,173 $ 2,388 $ 2,176 Gross profit from other lines of business 233 252 476 490 Selling, general and administrative expenses (404) (378) (793) (760) Restructuring charge (1) (1) (18) (2) (19) Non-rental depreciation and amortization (109) (104) (213) (222) Interest expense, net (173) (161) (333) (311) Other income, net 4 8 7 12 Income before provision for income taxes $ 835 $ 772 $ 1,530 $ 1,366 ___________________ (1) Primarily reflects severance and branch closure charges associated with our restructuring programs. The restructuring charges generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition. The amounts above primarily reflect charges associated with the restructuring program initiated following the December 2022 acquisition of Ahern Rentals, Inc. As of June 30, 2024, there were no open restructuring programs. |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table presents the changes in the carrying amount of goodwill for the six months ended June 30, 2024: General rentals Specialty Total Balance at January 1, 2024 (1) $ 4,775 $ 1,165 $ 5,940 Goodwill related to acquisitions (2) 5 820 825 Foreign currency translation and other adjustments (7) (9) (16) Balance at June 30, 2024 (1) $ 4,773 $ 1,976 $ 6,749 _________________ (1) The total carrying amount of goodwill for all periods in the table above is reflected net of $1.557 billion of accumulated impairment charges, which were primarily recorded in our general rentals segment. (2) Includes goodwill adjustments for the effect on goodwill of changes to net assets acquired during the measurement period. The goodwill related to acquisitions above primarily reflects the March 2024 acquisition of Yak, which is discussed note 3 to our condensed consolidated financial statements. |
Schedule of Other Intangible Assets | Other intangible assets were comprised of the following at June 30, 2024 and December 31, 2023: June 30, 2024 Weighted-Average Remaining Gross Accumulated Net Non-compete agreements 3 years $ 169 $ 70 $ 99 Customer relationships 6 years $ 2,666 $ 2,023 $ 643 Trade names and associated trademarks 2 years $ 8 $ 6 $ 2 December 31, 2023 Weighted-Average Remaining Gross Accumulated Net Non-compete agreements 4 years $ 176 $ 58 $ 118 Customer relationships 6 years $ 2,468 $ 1,919 $ 549 Trade names and associated trademarks 2 years $ 9 $ 6 $ 3 June 30, 2024 Weighted-Average Remaining Net Carrying Customer relationships 6 years 139 |
Schedule of Estimated Amortization Expense for Other Intangible Assets | As of June 30, 2024, estimated amortization expense for other intangible assets for each of the next five years and thereafter is as follows: 2024 $ 125 2025 213 2026 162 2027 111 2028 61 Thereafter 72 Total $ 744 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Instruments | The estimated fair values of our other financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of June 30, 2024 and December 31, 2023 have been calculated based upon available market information, and were as follows: June 30, 2024 December 31, 2023 Carrying Fair Carrying Fair Senior notes $ 8,817 $ 8,459 $ 7,720 $ 7,442 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Debt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following: June 30, 2024 December 31, 2023 Repurchase facility (terminated in 2024) (1) $ — $ 100 Accounts receivable securitization facility expiring 2025 (1) (2) 1,289 1,300 $4.25 billion ABL facility expiring 2027 (1) 1,571 1,261 Term loan facility expiring 2031 (1) (3) 988 945 5 1 / 2 percent Senior Notes due 2027 499 498 3 7 / 8 percent Senior Secured Notes due 2027 746 745 4 7 / 8 percent Senior Notes due 2028 (4) 1,666 1,665 6 percent Senior Secured Notes due 2029 1,489 1,488 5 1 / 4 percent Senior Notes due 2030 745 745 4 percent Senior Notes due 2030 745 744 3 7 / 8 percent Senior Notes due 2031 1,092 1,091 3 3 / 4 percent Senior Notes due 2032 745 744 6 1 / 8 percent Senior Notes due 2034 (5) 1,090 — Finance leases 224 192 Total debt 12,889 11,518 Less short-term portion (6) (1,369) (1,465) Total long-term debt $ 11,520 $ 10,053 ___________________ (1) The table below presents financial information associated with our variable rate indebtedness as of and for the six months ended June 30, 2024. The repurchase facility is not included below because (i) there were no borrowings under it during the six months ended June 30, 2024 and (ii) it was terminated in May 2024. We have borrowed the full available amount under the term loan facility. The principal obligation under the term loan facility is required to be repaid in quarterly installments in an aggregate amount equal to 1.0 percent per annum, with the balance due at the maturity of the facility. The average amount of debt outstanding under the term loan facility decreases slightly each quarter due to the requirement to repay a portion of the principal obligation. ABL facility Accounts receivable securitization facility Term loan facility Borrowing capacity, net of letters of credit $ 2,653 $ 147 $ — Letters of credit 18 Interest rate at June 30, 2024 6.5 % 6.3 % 7.1 % Average month-end debt outstanding 1,354 1,156 991 Weighted-average interest rate on average debt outstanding 6.5 % 6.3 % 7.1 % Maximum month-end debt outstanding 1,578 1,290 1,000 (2) In May 2024, the accounts receivable securitization facility was amended, primarily to increase the facility size and extend the maturity date. The size of the facility, which expires on June 24, 2025, was increased to $1.5 billion. The facility may be extended on a 364-day basis by mutual agreement with the purchasers under the facility. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of June 30, 2024, there were $1.437 billion of receivables, net of applicable reserves and other deductions, in the collateral pool. (3) In February 2024, the term loan facility was amended, primarily to extend the maturity date to February 14, 2031 and to increase the facility size to $1.000 billion (at the time of the amendment, the facility size was $948). (4) URNA separately issued 4 7 / 8 percent Senior Notes in August 2017 and in September 2017. Following the issuances, URNA consummated an exchange offer pursuant to which most of the 4 7 / 8 percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 7 / 8 percent Senior Notes issued in August 2017. As of June 30, 2024, the total above is comprised of two separate 4 7 / 8 percent Senior Notes, one with a book value of $1.662 billion and one with a book value of $4. (5) In March 2024, URNA issued $1.100 billion aggregate principal amount of 6 1 / 8 percent Senior Notes (the “6 1 / 8 percent Notes”) which are due March 15, 2034. The 6 1 / 8 percent Notes are unsecured and are guaranteed by Holdings and certain domestic subsidiaries of URNA. The 6 1 / 8 percent Notes may be redeemed on or after March 15, 2029, at specified redemption prices that range from 103.063 percent in 2029, to 100 percent in 2032 and thereafter, in each case, plus accrued and unpaid interest, if any. At any time prior to March 15, 2029, URNA may, at its option, redeem some or all of the 6 1 / 8 percent Notes at a redemption price equal to 100 percent of the aggregate principal amount of the notes to be redeemed, plus a “make-whole” premium and accrued and unpaid interest, if any, to the redemption date. In addition, at any time on or prior to March 15, 2027, up to 40 percent of the aggregate principal amount of the 6 1 / 8 percent Notes may be redeemed with the net cash proceeds of certain equity offerings at a redemption price equal to 106.125 percent of the aggregate principal amount of the notes plus accrued and unpaid interest, if any. The indenture governing the 6 1 / 8 percent Notes contains certain restrictive covenants, including, among others, limitations on (i) liens and (ii) mergers and consolidations, as well as a requirement to timely file periodic reports with the SEC. Each of the restrictive covenants is subject to important exceptions and qualifications that would allow URNA and its subsidiaries to engage in these activities under certain conditions. In addition, the requirements to provide subsidiary guarantees and to make an offer to repurchase the notes upon the occurrence of a change of control will not apply to URNA and its restricted subsidiaries during any period when the 6 1 / 8 percent Notes are rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA, provided at such time no default under the indenture has occurred and is continuing. The indenture also requires that, in the event of a change of control (as defined in the indenture), URNA must make an offer to purchase all of the then-outstanding 6 1 / 8 percent Notes tendered at a purchase price in cash equal to 101 percent of the principal amount thereof, plus accrued and unpaid interest, if any, thereon. (6) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share (shares in thousands): Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Numerator: Net income available to common stockholders $ 636 $ 591 1,178 1,042 Denominator: Denominator for basic earnings per share—weighted-average common shares 66,563 68,718 66,888 69,064 Effect of dilutive securities: Employee stock options 2 4 3 4 Restricted stock units 147 119 173 223 Denominator for diluted earnings per share—adjusted weighted-average common shares 66,712 68,841 67,064 69,291 Basic earnings per share $ 9.56 $ 8.60 $ 17.62 $ 15.09 Diluted earnings per share $ 9.54 $ 8.58 $ 17.57 $ 15.04 |
Revenue Recognition (Changes in
Revenue Recognition (Changes in Accounting Principles) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenues: | ||||
Revenues, Topic 842 | $ 2,903 | $ 2,702 | $ 5,563 | $ 5,185 |
Revenues, Topic 606 | 870 | 852 | 1,695 | 1,654 |
Revenues, Total | 3,773 | 3,554 | 7,258 | 6,839 |
Equipment rentals | ||||
Revenues: | ||||
Revenues, Topic 842 | 2,903 | 2,702 | 5,563 | 5,185 |
Revenues, Topic 606 | 312 | 279 | 581 | 536 |
Revenues, Total | 3,215 | 2,981 | 6,144 | 5,721 |
Owned equipment rentals | ||||
Revenues: | ||||
Owned equipment rentals, Topic 842 | 2,604 | 2,461 | 5,008 | 4,727 |
Revenues, Total | 2,604 | 2,461 | 5,008 | 4,727 |
Re-rent revenue | ||||
Revenues: | ||||
Re-rent revenue, Topic 842 | 58 | 56 | 113 | 108 |
Revenues, Total | 58 | 56 | 113 | 108 |
Delivery and pick-up | ||||
Revenues: | ||||
Revenues, Topic 606 | 267 | 238 | 481 | 441 |
Revenues, Total | 267 | 238 | 481 | 441 |
Other | ||||
Revenues: | ||||
Other, Topic 842 | 241 | 185 | 442 | 350 |
Revenues, Topic 606 | 45 | 41 | 100 | 95 |
Revenues, Total | 286 | 226 | 542 | 445 |
Total ancillary and other rental revenues | ||||
Revenues: | ||||
Revenues, Topic 842 | 241 | 185 | 442 | 350 |
Revenues, Topic 606 | 312 | 279 | 581 | 536 |
Revenues, Total | 553 | 464 | 1,023 | 886 |
Sales of rental equipment | ||||
Revenues: | ||||
Revenues, Topic 606 | 365 | 382 | 748 | 770 |
Revenues, Total | 365 | 382 | 748 | 770 |
Sales of new equipment | ||||
Revenues: | ||||
Revenues, Topic 606 | 61 | 70 | 109 | 114 |
Revenues, Total | 61 | 70 | 109 | 114 |
Contractor supplies sales | ||||
Revenues: | ||||
Revenues, Topic 606 | 42 | 37 | 78 | 71 |
Revenues, Total | 42 | 37 | 78 | 71 |
Service and other revenues | ||||
Revenues: | ||||
Revenues, Topic 606 | 90 | 84 | 179 | 163 |
Revenues, Total | $ 90 | $ 84 | $ 179 | $ 163 |
Revenue Recognition (Narrative)
Revenue Recognition (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||||||
Contract with customer, liability | $ 155 | $ 155 | $ 138 | ||||
Accounts receivable, net | 2,260 | 2,260 | $ 2,230 | ||||
Allowance for doubtful accounts | 176 | 176 | |||||
Contract with customer, asset | 0 | 0 | |||||
Revenue recognized | 0 | $ 0 | 0 | $ 0 | |||
Contract with customer, performance obligation satisfied in previous period | $ 0 | $ 0 | $ 0 | $ 0 | |||
Revenues | Product concentration risk | Owned equipment rentals | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Concentration risk | 69% | ||||||
Revenues | Product concentration risk | Equipment Rental | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Concentration risk | 77% | ||||||
Revenues | Product concentration risk | General rentals | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Concentration risk | 72% | ||||||
Revenues | Geographic Concentration Risk | US | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Concentration risk | 91% | ||||||
Revenues | Customer concentration risk | Largest customer | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Concentration risk | 1% | 1% | 1% | 1% | |||
Accounts Receivable | Customer concentration risk | Largest customer | |||||||
Property, Plant and Equipment [Line Items] | |||||||
Concentration risk | 1% | 1% |
Revenue Recognition (Allowance
Revenue Recognition (Allowance for Doubtful Accounts Rollforward) (Details) - SEC Schedule, 12-09, Allowance, Credit Loss - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Beginning balance | $ 174 | $ 146 | $ 169 | $ 134 |
Charged to costs and expenses | 3 | 2 | 7 | 5 |
Charged to revenue | 14 | 8 | 23 | 21 |
Deductions and other | (15) | (9) | (23) | (13) |
Ending balance | $ 176 | $ 147 | $ 176 | $ 147 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |
Mar. 15, 2024 USD ($) numberOfState mat | Jun. 30, 2024 USD ($) | Jun. 30, 2024 USD ($) | |
Senior Notes, 6.125 Percent | Senior notes | |||
Business Acquisition [Line Items] | |||
Debt instrument, face amount | $ 1,100 | ||
Stated interest rate | 6.125% | 6.125% | 6.125% |
Yak | |||
Business Acquisition [Line Items] | |||
Number of service protection mats | mat | 600,000 | ||
Number of states | numberOfState | 40 | ||
Aggregate consideration paid | $ 1,156 | ||
Business combination, contingent consideration, liability | 39 | ||
Business combination, maximum contingent consideration payable | $ 50 | ||
Business combination, contingent consideration, period | 2 years | ||
Business combination, revenue of acquiree since acquisition date, actual | $ 87 | $ 102 |
Acquisitions (Assets Acquired a
Acquisitions (Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Millions | Mar. 15, 2024 | Jun. 30, 2024 | Dec. 31, 2023 |
Business Acquisition [Line Items] | |||
Goodwill | $ 6,749 | $ 5,940 | |
Yak | |||
Business Acquisition [Line Items] | |||
Accounts receivable | $ 99 | ||
Inventory | 8 | ||
Rental equipment | 143 | ||
Property and equipment | 32 | ||
Intangible assets (customer relationships) | 150 | ||
Operating lease right-of-use assets | 6 | ||
Other assets | 17 | ||
Total identifiable assets acquired | 455 | ||
Accounts payable, accrued expenses and other liabilities | (103) | ||
Operating lease liabilities | (6) | ||
Total liabilities assumed | (109) | ||
Net identifiable assets acquired | 346 | ||
Goodwill | 810 | ||
Net assets acquired | 1,156 | ||
Business combination, acquired receivable, fair value | 99 | ||
Gross contractual amount | 102 | ||
Estimated amount uncollectible | $ 3 | ||
Yak | Customer relationships | |||
Business Acquisition [Line Items] | |||
Life (years) | 6 years |
Acquisitions (Business Acquisit
Acquisitions (Business Acquisition, Pro Forma Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Total revenues | $ 3,773 | $ 3,554 | $ 7,258 | $ 6,839 |
Pro forma revenue | 3,647 | 7,355 | 7,023 | |
Combined pretax income | 835 | 772 | 1,530 | 1,366 |
Pro forma pretax income | 758 | 1,516 | 1,336 | |
Yak | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma revenue | 199 | |||
Business combination, revenue of acquiree since acquisition date, actual | $ 87 | 102 | ||
Impact of fair value mark-ups/useful life changes on depreciation | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma pretax income | (2) | (1) | (4) | |
Intangible asset amortization | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma pretax income | (4) | (2) | (9) | |
Interest expense | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma pretax income | (17) | (14) | (34) | |
Elimination of historic interest | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma pretax income | 16 | 11 | 39 | |
Elimination of refinancing transactions | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma pretax income | 1 | (40) | (101) | |
Transaction bonuses and other | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Pro forma pretax income | 1 | 22 | 2 | |
Yak | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Total revenues | 93 | 97 | 184 | |
Combined pretax income | (9) | 10 | 77 | |
United Rentals | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Combined pretax income | 772 | 1,530 | 1,366 | |
United Rentals and Yak | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Combined pretax income | $ 763 | $ 1,540 | $ 1,443 |
Segment Information (Financial
Segment Information (Financial Information by Segment) (Details) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2024 USD ($) geographicDivision | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) geographicDivision | Jun. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Segment Reporting Information | |||||
Total revenues | $ 3,773 | $ 3,554 | $ 7,258 | $ 6,839 | |
Revenue from contract with customer | 870 | 852 | 1,695 | 1,654 | |
Depreciation and amortization expense | 717 | 696 | 1,403 | 1,389 | |
Equipment rentals gross profit | 1,518 | 1,425 | 2,864 | 2,666 | |
Capital expenditures | 2,181 | 2,227 | |||
Assets | $ 27,613 | 27,613 | $ 25,589 | ||
Sales of rental equipment | |||||
Segment Reporting Information | |||||
Capital expenditures incurred but not yet paid | $ 224 | 74 | |||
General rentals | |||||
Segment Reporting Information | |||||
Number of geographic divisions entity operates in (locations) | geographicDivision | 4 | 4 | |||
Total revenues | $ 2,653 | 2,653 | $ 5,199 | 5,132 | |
Depreciation and amortization expense | 541 | 580 | 1,115 | 1,157 | |
Capital expenditures | 1,658 | 1,766 | |||
Assets | 20,804 | 20,804 | 20,411 | ||
Specialty | |||||
Segment Reporting Information | |||||
Total revenues | 1,120 | 901 | 2,059 | 1,707 | |
Depreciation and amortization expense | 176 | 116 | 288 | 232 | |
Capital expenditures | 523 | 461 | |||
Assets | 6,809 | 6,809 | $ 5,178 | ||
Equipment rentals | |||||
Segment Reporting Information | |||||
Total revenues | 3,215 | 2,981 | 6,144 | 5,721 | |
Revenue from contract with customer | 312 | 279 | 581 | 536 | |
Equipment rentals | General rentals | |||||
Segment Reporting Information | |||||
Total revenues | 2,209 | 2,189 | 4,279 | 4,207 | |
Equipment rentals | Specialty | |||||
Segment Reporting Information | |||||
Total revenues | 1,006 | 792 | 1,865 | 1,514 | |
Sales of rental equipment | |||||
Segment Reporting Information | |||||
Total revenues | 365 | 382 | 748 | 770 | |
Revenue from contract with customer | 365 | 382 | 748 | 770 | |
Sales of rental equipment | General rentals | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 313 | 342 | 659 | 692 | |
Sales of rental equipment | Specialty | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 52 | 40 | 89 | 78 | |
Sales of new equipment | |||||
Segment Reporting Information | |||||
Total revenues | 61 | 70 | 109 | 114 | |
Revenue from contract with customer | 61 | 70 | 109 | 114 | |
Sales of new equipment | General rentals | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 27 | 24 | 56 | 42 | |
Sales of new equipment | Specialty | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 34 | 46 | 53 | 72 | |
Contractor supplies sales | |||||
Segment Reporting Information | |||||
Total revenues | 42 | 37 | 78 | 71 | |
Revenue from contract with customer | 42 | 37 | 78 | 71 | |
Contractor supplies sales | General rentals | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 23 | 23 | 43 | 44 | |
Contractor supplies sales | Specialty | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 19 | 14 | 35 | 27 | |
Service and other revenues | |||||
Segment Reporting Information | |||||
Total revenues | 90 | 84 | 179 | 163 | |
Revenue from contract with customer | 90 | 84 | 179 | 163 | |
Service and other revenues | General rentals | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 81 | 75 | 162 | 147 | |
Service and other revenues | Specialty | |||||
Segment Reporting Information | |||||
Revenue from contract with customer | 9 | 9 | 17 | 16 | |
Equipment rentals gross profit | |||||
Segment Reporting Information | |||||
Equipment rentals gross profit | 1,285 | 1,173 | 2,388 | 2,176 | |
Equipment rentals gross profit | General rentals | |||||
Segment Reporting Information | |||||
Equipment rentals gross profit | 802 | 788 | 1,483 | 1,451 | |
Equipment rentals gross profit | Specialty | |||||
Segment Reporting Information | |||||
Equipment rentals gross profit | $ 483 | $ 385 | $ 905 | $ 725 |
Segment Information (Reconcilia
Segment Information (Reconciliation to Equipment Rentals Gross Profit) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Equipment rentals gross profit | $ 1,518 | $ 1,425 | $ 2,864 | $ 2,666 |
Selling, general and administrative expenses | (404) | (378) | (793) | (760) |
Restructuring charge | (1) | (18) | (2) | (19) |
Non-rental depreciation and amortization | (109) | (104) | (213) | (222) |
Interest expense, net | (173) | (161) | (333) | (311) |
Other income, net | 4 | 8 | 7 | 12 |
Income before provision for income taxes | 835 | 772 | 1,530 | 1,366 |
Total equipment rentals gross profit | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Equipment rentals gross profit | 1,285 | 1,173 | 2,388 | 2,176 |
Gross profit from other lines of business | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Equipment rentals gross profit | $ 233 | $ 252 | $ 476 | $ 490 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Goodwill) (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2024 USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 5,940 |
Goodwill related to acquisitions | 825 |
Foreign currency translation and other adjustments | (16) |
Ending balance | 6,749 |
Goodwill accumulated impairment loss | 1,557 |
General rentals | |
Goodwill [Roll Forward] | |
Beginning balance | 4,775 |
Goodwill related to acquisitions | 5 |
Foreign currency translation and other adjustments | (7) |
Ending balance | 4,773 |
Specialty | |
Goodwill [Roll Forward] | |
Beginning balance | 1,165 |
Goodwill related to acquisitions | 820 |
Foreign currency translation and other adjustments | (9) |
Ending balance | $ 1,976 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Other Intangible Assets) (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Net Amount | $ 744 | $ 670 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Amortization Period | 3 years | 4 years |
Gross Carrying Amount | $ 169 | $ 176 |
Accumulated Amortization | 70 | 58 |
Net Amount | $ 99 | $ 118 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Amortization Period | 6 years | 6 years |
Gross Carrying Amount | $ 2,666 | $ 2,468 |
Accumulated Amortization | 2,023 | 1,919 |
Net Amount | $ 643 | $ 549 |
Trade names and associated trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Amortization Period | 2 years | 2 years |
Gross Carrying Amount | $ 8 | $ 9 |
Accumulated Amortization | 6 | 6 |
Net Amount | $ 2 | $ 3 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets (Other Intangible Assets Associated with Acquisition) (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 744 | $ 670 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Amortization Period | 6 years | 6 years |
Net Carrying Amount | $ 643 | $ 549 |
General Finance Corporation | Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Amortization Period | 6 years | |
Net Carrying Amount | $ 139 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 66 | $ 65 | $ 126 | $ 144 |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets (Estimated Amortization Expense for Other Intangible Assets) (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 | $ 125 | |
2025 | 213 | |
2026 | 162 | |
2027 | 111 | |
2028 | 61 | |
Thereafter | 72 | |
Net Amount | $ 744 | $ 670 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Level 1 - Senior notes - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ||
Senior notes | $ 8,817 | $ 7,720 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions | ||
Senior notes | $ 8,459 | $ 7,442 |
Debt (Long-term Debt Instrument
Debt (Long-term Debt Instruments) (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |||||
May 31, 2024 | Mar. 31, 2024 | Jun. 30, 2024 | Mar. 15, 2024 | Feb. 28, 2024 | Jan. 31, 2024 | Dec. 31, 2023 | |
Debt Instrument | |||||||
Finance leases | $ 224,000,000 | $ 192,000,000 | |||||
Total debt | 12,889,000,000 | 11,518,000,000 | |||||
Less short-term portion | (1,369,000,000) | (1,465,000,000) | |||||
Total long-term debt | 11,520,000,000 | 10,053,000,000 | |||||
Repurchase facility (terminated in 2024) | Repurchase facility | |||||||
Debt Instrument | |||||||
Long-term debt | 0 | 100,000,000 | |||||
Accounts receivable securitization facility expiring 2025 | Line of Credit | |||||||
Debt Instrument | |||||||
Maximum borrowing capacity | $ 1,500,000,000 | ||||||
Long-term debt | 1,289,000,000 | 1,300,000,000 | |||||
Borrowing capacity, net of letters of credit | $ 147,000,000 | ||||||
Interest rate at June 30, 2024 | 6.30% | ||||||
Average month-end debt outstanding | $ 1,156,000,000 | ||||||
Weighted-average interest rate on average debt outstanding | 6.30% | ||||||
Maximum month-end debt outstanding | $ 1,290,000,000 | ||||||
Debt instrument, extension period | 364 days | ||||||
Collateral amount | 1,437,000,000 | ||||||
$4.25 billion ABL facility expiring 2027 | Line of Credit | |||||||
Debt Instrument | |||||||
Maximum borrowing capacity | 4,250,000,000 | ||||||
Long-term debt | 1,571,000,000 | 1,261,000,000 | |||||
Borrowing capacity, net of letters of credit | 2,653,000,000 | ||||||
Letters of credit | $ 18,000,000 | ||||||
Interest rate at June 30, 2024 | 6.50% | ||||||
Average month-end debt outstanding | $ 1,354,000,000 | ||||||
Weighted-average interest rate on average debt outstanding | 6.50% | ||||||
Maximum month-end debt outstanding | $ 1,578,000,000 | ||||||
Term loan facility expiring 2031 | |||||||
Debt Instrument | |||||||
Long-term debt | $ 988,000,000 | 945,000,000 | |||||
Annual repayment rate | 1% | ||||||
Long-term debt, gross | $ 1,000,000,000 | $ 948,000,000 | |||||
5 1/2 percent Senior Notes due 2027 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 5.50% | ||||||
Long-term debt | $ 499,000,000 | 498,000,000 | |||||
3 7/8 percent Senior Secured Notes due 2027 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 3.875% | ||||||
Long-term debt | $ 746,000,000 | 745,000,000 | |||||
4 7/8 percent Senior Notes due 2028 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 4.875% | ||||||
Long-term debt | $ 1,666,000,000 | 1,665,000,000 | |||||
6 percent Senior Secured Notes due 2029 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 6% | ||||||
Long-term debt | $ 1,489,000,000 | 1,488,000,000 | |||||
5 1/4 percent Senior Notes due 2030 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 5.25% | ||||||
Long-term debt | $ 745,000,000 | 745,000,000 | |||||
4 percent Senior Notes due 2030 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 4% | ||||||
Long-term debt | $ 745,000,000 | 744,000,000 | |||||
3 7/8 percent Senior Notes due 2031 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 3.875% | ||||||
Long-term debt | $ 1,092,000,000 | 1,091,000,000 | |||||
3 3/4 percent Senior Notes due 2032 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 3.75% | ||||||
Long-term debt | $ 745,000,000 | 744,000,000 | |||||
6 1/8 percent Senior Notes due 2034 | Senior notes | |||||||
Debt Instrument | |||||||
Stated interest rate | 6.125% | 6.125% | |||||
Long-term debt | $ 1,090,000,000 | $ 0 | |||||
Debt instrument, face amount | $ 1,100,000,000 | ||||||
6 1/8 percent Senior Notes due 2034 | Senior notes | Subsidiaries | |||||||
Debt Instrument | |||||||
Debt instrument, face amount | $ 1,100,000,000 | ||||||
6 1/8 percent Senior Notes due 2034 | Senior notes | Redemption Period One | Subsidiaries | |||||||
Debt Instrument | |||||||
Debt instrument, redemption price, percentage | 103.063% | ||||||
6 1/8 percent Senior Notes due 2034 | Senior notes | Redemption Period Two | Subsidiaries | |||||||
Debt Instrument | |||||||
Debt instrument, redemption price, percentage | 100% | ||||||
6 1/8 percent Senior Notes due 2034 | Senior notes | Redemption Period Three | Subsidiaries | |||||||
Debt Instrument | |||||||
Debt instrument, redemption price, percentage | 106.125% | ||||||
6 1/8 percent Senior Notes due 2034 | Senior notes | Redemption Period Four | Subsidiaries | |||||||
Debt Instrument | |||||||
Debt instrument, redemption price, percentage | 40% | ||||||
6 1/8 percent Senior Notes due 2034 | Senior notes | Redemption Period Five | Subsidiaries | |||||||
Debt Instrument | |||||||
Debt instrument, redemption price, percentage | 101% | ||||||
Term loan facility | Line of Credit | |||||||
Debt Instrument | |||||||
Borrowing capacity, net of letters of credit | $ 0 | ||||||
Interest rate at June 30, 2024 | 7.10% | ||||||
Average month-end debt outstanding | $ 991,000,000 | ||||||
Weighted-average interest rate on average debt outstanding | 7.10% | ||||||
Maximum month-end debt outstanding | $ 1,000,000,000 | ||||||
4 7/8 percent Senior Notes due 2028, one | Senior notes | |||||||
Debt Instrument | |||||||
Long-term debt | 1,662,000,000 | ||||||
4 7/8 percent Senior Notes due 2028, two | Senior notes | |||||||
Debt Instrument | |||||||
Long-term debt | $ 4,000,000 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2024 | |
ABL Facility | Line of Credit | |
Debt Instrument | |
Minimum available borrowing capacity, percentage | 10% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Numerator: | ||||
Net income available to common stockholders | $ 636 | $ 591 | $ 1,178 | $ 1,042 |
Denominator: | ||||
Denominator for basic earnings per share—weighted-average common shares (in shares) | 66,563 | 68,718 | 66,888 | 69,064 |
Effect of dilutive securities: | ||||
Denominator for diluted earnings per share—adjusted weighted-average common shares (in shares) | 66,712 | 68,841 | 67,064 | 69,291 |
Basic earnings per share (in dollars per share) | $ 9.56 | $ 8.60 | $ 17.62 | $ 15.09 |
Diluted earnings per share (in dollars per share) | $ 9.54 | $ 8.58 | $ 17.57 | $ 15.04 |
Employee stock options | ||||
Effect of dilutive securities: | ||||
Effect of dilutive securities (in shares) | 2 | 4 | 3 | 4 |
Restricted stock units | ||||
Effect of dilutive securities: | ||||
Effect of dilutive securities (in shares) | 147 | 119 | 173 | 223 |