Custom Truck One Source (CTOS) reported first‑quarter 2026 revenue of $461.6 million, a 9.3% year‑over‑year increase that surpassed analyst estimates of $456.8 million to $454.2 million. The company posted a non‑GAAP net loss of $4.1 million, or a loss per share of $0.02, beating the consensus loss of $0.05 to $0.06 per share by roughly 62% to 67%.
Revenue growth was driven by robust demand in the utility and infrastructure markets, with the average original equipment cost (OEC) on rent rising 12% to $1.34 billion. Rental fleet utilization climbed to 81.4%, up 370 basis points from the same period last year, and the newly reorganized Specialty Equipment Rentals (SER) segment contributed the bulk of the top‑line lift. The Specialty Truck Equipment and Manufacturing (STEM) segment also grew 5% year‑over‑year, reflecting incremental sales to non‑SER customers.
Operating performance improved markedly: adjusted EBITDA reached $98 million, a 21.2% margin that represents a 4.2‑percentage‑point expansion from the prior year’s 17% margin. The margin gain stems from a higher mix of high‑margin rental contracts and operational leverage, while the net loss was largely offset by interest and depreciation charges that were higher than in the previous quarter. The company’s adjusted gross profit increased 17% YoY, underscoring the effectiveness of cost controls and pricing power.
Management raised its full‑year 2026 Adjusted EBITDA guidance to $415 million–$440 million, up from $410 million–$435 million, and reaffirmed revenue guidance of $2.005 billion–$2.120 billion. The upward revision signals confidence in continued strength in the transmission and distribution (T&D) sector and the momentum of federal infrastructure spending. The company also reiterated its commitment to deleveraging, targeting a net leverage ratio below 4.0x by year‑end 2026.
Investors reacted positively, with the stock trading up 4.78% in pre‑market sessions. The market response was driven by the revenue and earnings beat, as well as the higher guidance, which together reinforced expectations of sustained demand and improved profitability.
CEO Ryan McMonagle highlighted the record revenue, the 12% rise in OEC on rent, and the 81.4% fleet utilization, noting that the company’s young rental fleet and strong OEM relationships position it well for the upcoming EPA 2027 emission standards and continued growth in the T&D market.
The content on EveryTicker is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.