Hertz Global Holdings Inc. Reported a worse-than-expected loss after its failed bet on Tesla Inc. Electric vehicles weighed on the value of cars in its fleet.
The rental giant lost an adjusted $1.44 a share in the second quarter, according to a statement Thursday, compared with analysts’ average estimate of a $1.17 deficit. Hertz said fleet refreshment efforts drove per-unit depreciation to $600 a month, more than three times higher than a year ago, as the company unloads EVs faster than originally planned.
The results underscore the heavy financial toll from its strategic pivot. Under new Chief Executive Officer Gil West, a former Delta Air Lines Inc. Executive, Hertz is trying to unwind the Tesla debacle by selling off the vehicles at a loss and revamping the management team. West wants to improve efficiency in the business and better manage the vehicle fleet.
Hertz has said it will sell tens of thousands of Tesla electric vehicles this year. The company said Thursday that it expects the fleet overhaul to be substantially done by the end of 2025, by which point monthly depreciation will normalize in the low $300s per unit.
Revenue last quarter was $2.35 billion, short of the $2.46 billion average of analyst estimates compiled by Bloomberg.
Hertz raised $1 billion during the quarter to bolster its liquidity, which stood at $1.8 billion as of June 30. Despite the loss, the company said demand remained “healthy.”
Its shares fell 1.2% as of 9:44 a.m. In New York. The stock is down more than 60% this year as investors wait to see when the company will stem losses from selling its EVs.