Shares of Avis Budget Group (NASDAQ: CAR) tumbled 5.09% in after-hours trading on Tuesday following the release of its second-quarter financial results that fell short of analyst expectations. The car rental giant reported earnings per share of $0.10, significantly below the consensus estimate of $1.75, and a steep decline from $0.41 in the same period last year.

Revenue for the quarter came in at $3.00 billion, slightly missing analysts' projections of $3.02 billion and representing a 1.57% decrease year-over-year. The company's net income dropped to $4 million, compared to $15 million in Q2 2024, reflecting challenging market conditions and increased operational costs.

Despite the disappointing earnings report, Avis Budget announced a multi-year strategic partnership with Waymo, Alphabet's autonomous driving technology company, to launch a fully autonomous ride-hailing service in Dallas. The collaboration, which includes Avis serving as Waymo's fleet operations partner, is set for public launch in 2026. However, this long-term initiative did little to offset investors' immediate concerns about the company's current financial performance.