By Mackenzie Tatananni

Shares of Hertz Global Holdings rallied on the heels of strong third-quarter earnings as the rental car company returned to profitability for the first time in two years.

Shares surged more than 37% to $6.83, heading for the largest same-day percentage increase since a 44% jump in April, according to Dow Jones Market Data. Peer Avis Budget Group was up 3.3%.

Earnings of 42 cents a share handily beat the 3 cents Wall Street had anticipated, according to FactSet. While global revenue fell nearly 4% from last year to $2.48 billion, the figure surpassed the $2.39 billion analysts had forecast.

The highlight of the quarter was the company's return to earnings-per-share profitability for the first time since 2023. The recovery was largely due to lower depreciation of Hertz's assets -- in this case, rental cars -- as measured in depreciation per unit per month, which fell 49% to $273 in the quarter.

The metric represents the average amount of depreciation expense and lease charges per vehicle each month. In short, it's an indicator of how effectively Hertz is managing the costs of its vehicles.

Another bright point was the company's vehicle utilization rate, which improved two percentage points to 84% from the same period last year. A higher utilization rate indicates more cars were rented out rather than sitting idle.

CEO Gil West described it on a call with investors as a "record high utilization rate since 2018." While 2% of the company U.S. fleet was under a recall, "being able to drive record utilization in that environment shows that even when headwinds get in the way, we're able to deliver strong results," West continued.

Hertz ended the quarter with over $2.2 billion in liquidity, which is proof of the company's "disciplined balance sheet management," Hertz said.

In August, the company unveiled a strategic partnership with Amazon.com to sell used vehicles over Amazon Autos, a platform launched in 2024. The collaboration saw Hertz became Amazon's first fleet customer.

West indicated the strategy was bearing fruit, saying on the call that the Amazon collaboration and other initiatives "create an omnichannel experience that we believe only Hertz can offer."

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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November 04, 2025 11:01 ET (16:01 GMT)

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