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United Rentals, Inc. URI witnessed a 5.2% fall in its share price during the after-hours trading session yesterday, following the release of the third-quarter 2025 results. The company’s earnings per share (EPS) missed the Zacks Consensus Estimate and revenues beat the same. On a year-over-year basis, the top line increased, but the bottom line declined.
The company reported record third-quarter revenues and adjusted EBITDA, driven by strong demand across construction and industrial end-markets. This performance reflects continued momentum from the prior quarter. Growth in both general rentals and specialty segments supported the results. Customer optimism, healthy backlogs and seasonal activity contributed to the overall strength.
Going forward, United Rentals expects to see continued growth in large projects and strong performance in the specialty segment. Based on these trends, the company has raised its 2025 outlook. URI aims to maintain focus on execution through its market approach, technology offerings and disciplined capital allocation.
Adjusted EPS of $11.70 missed the Zacks Consensus Estimate of $12.49 by 6.3%. The reported figure decreased 0.8% from the prior-year adjusted figure of $11.80 per share.
Total revenues were $4.229 billion in the quarter, beating the consensus mark of $4.157 billion by 1.7%. On a year-over-year basis, the top line grew 5.9%.
United Rentals, Inc. price-consensus-eps-surprise-chart | United Rentals, Inc. Quote
Equipment Rentals’ revenues increased 5.8% from the year-ago quarter to $3.665 billion, marking a record high for the third quarter. Fleet productivity inched up 2% year over year. Average original equipment at cost increased 4.2% year over year.
Used equipment sales (or sales of rental equipment) increased 3.7% from a year ago to $333 million. This produced an adjusted gross margin of 45.9%, which contracted 360 basis points (bps). The decrease in the year-over-year adjusted gross margin primarily resulted from the ongoing normalization of the used equipment market, which includes pricing adjustments.
General Rentals: This segment registered 3.1% year-over-year growth in revenues to a third-quarter record of $2.4 billion. Rental gross margin contracted 90 bps year over year to 36.7%, indicating the impact of inflation and normal cost variability, including higher delivery.
Specialty: Segmental revenues improved 11.4% year over year to a third-quarter record of $1.265 billion. Rental gross margin, however, contracted 490 bps year over year to 45.1%, indicating higher depreciation expense related to growth in the company's matting business.
The company’s total equipment rentals’ gross margin contracted 200 bps year over year to 39.6%.
Adjusted EBITDA for the reported period grew 2.2% year over year to $1.946 billion. Our estimate for the metric was $1.98 billion. However, the adjusted EBITDA margin contracted 170 bps to 46%. This decline primarily stemmed from a decreased rental and used equipment sales gross margin.
United Rentals had cash and cash equivalents of $512 million as of Sept. 30, 2025, up from $457 million at 2024-end. Total liquidity was $2.452 billion at the third-quarter end. Long-term debt at the third quarter of 2025-end was $12.6 billion, up from $12.23 billion at 2024-end.
As of Sept. 30, 2025, the net leverage ratio was 1.86x compared with Dec. 31, 2024. Return on invested capital was 12% for the trailing 12 months ended on Sept. 30, 2025.
During the first nine months of 2025, net cash from operating activities improved 12.5% year over year to $3.934 billion. Free cash flow decreased 1.6% year over year to $1.192 billion for the said period.
During the first nine months of 2025, the company completed its previous $1.5 billion share repurchase program and launched a new $1.5 billion program, which was later raised to $2 billion following new federal tax legislation in July 2025. Over the same period, the company repurchased $1.28 billion worth of common stock under both programs and distributed $350 million in dividends.
Total revenues are now expected to be in the range of $16-$16.2 billion compared with $15.8-$16.1 billion expected earlier. The new expectation indicates quite an improvement from $15.345 billion reported in 2024.
Adjusted EBITDA is now expected to be between $7.325 billion and $7.425 billion compared with $7.3 billion to $7.45 billion projected earlier. The guidance indicates an increase from $7.160 billion reported in 2024.
Net rental capital expenditure is still anticipated to be in the range of $2.55-$2.75 billion (after gross purchases of $4 billion to $4.2 billion) compared with $2.235 billion after gross purchases of $3.756 billion in 2024.
Net cash provided by operating activities is now anticipated to be in the range of $5-$5.4 billion compared with the prior expectation of $4.9-$5.5 billion.
Free cash flow (excluding the impact of merger and restructuring-related payments) is expected to be in the range of $2.1-$2.3 billion compared with the prior expectation of $2.4-$2.6 billion.
Currently, United Rentals carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
PulteGroup Inc. PHM has reported better-than-expected third-quarter 2025 results, wherein adjusted earnings and total revenues handily beat the Zacks Consensus Estimate. However, both metrics declined year over year.
The performance of the company was hurt during the quarter due to the current softness in the housing market because of weaker consumer confidence and ongoing affordability challenges. Moreover, increases in direct costs related to home and land sales hurt the bottom line, alongside a decline in revenues.
KB Home KBH reported third-quarter fiscal 2025 results. The quarter’s earnings and total revenues surpassed the Zacks Consensus Estimate but decreased on a year-over-year basis.
KB Home’s quarterly results highlighted ongoing challenges in a difficult housing market, reflecting pricing pressures across key regions. In response to weaker demand and the shortfall in orders, management adopted a cautious stance and revised its fiscal 2025 housing revenue guidance downward. KB Home is focused on expanding its build-to-order mix, reducing build times and enhancing customer satisfaction through affordable prices and personalization while maintaining strict cost controls.
Lennar Corporation LEN reported dismal results for the third quarter of fiscal 2025, wherein its adjusted earnings and total revenues missed the Zacks Consensus Estimate. Also, both metrics tumbled on a year-over-year basis.
The quarter’s performance was adversely impacted by the softness in the housing market due to ongoing affordability challenges and a decline in consumer confidence. To counter the affordability issues, Lennar’s initiative of lowering the ASP adversely impacted revenue growth during the quarter. Nonetheless, Lennar is focusing on scale and technology investments to drive cost efficiencies. A strong balance sheet and disciplined execution are expected to support margin improvement as conditions stabilize.
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This article originally published on Zacks Investment Research (zacks.com).
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