Avis Budget: Higher-than-Expected Profit

Avis Budget Group Inc. posted a better-than-expected second-quarter profit, but also announced job cuts and fleet size reductions, reducing its fleet size to tackle the challenging travel environment.

Net income for the quarter was $15 million, or 15 cents a share, compared with $24 million, or 22 cents a share, a year-ago. The net income was higher than analysts’ expectations of 6 cents a share, before special items, according to Reuters Estimates.

Revenue rose 4 percent to $1.58 billion, beating analysts' average expectation of $1.50 billion. Car rental revenue increased 5 percent year-over-year, but car fleet costs also rose 11 percent.

Avis Budget Group Chief Executive Officer Ronald Nelson said the impact of rising fuel costs and a weak economy began to affect commercial travel volumes in the second quarter. He said leisure traffic was less affected, as softer transaction volume was more than offset by longer length of rental.

For the full year, the company expects revenue to rise above $6 billion it posted in 2007. Domestic fleet costs are expected to rise by about 4 percent to 6 percent per vehicle.

Comment On This Story

Name:  
Email:  
Comment: (Max. 10000 characters)  
Please leave blank:
* Please note that every comment is moderated.

 
 

Newsletter: Sign up to receive latest news, articles, and much more.

Read the latest

Auto Focus Blog: A blog covering fleets, auto rental and the business of cars

Trump and Regulations: An Alt-Fuel View

With 2025 emissions targets back in review, manufacturers, alt-fuel, and alt-power suppliers weigh in on the potential impacts of Trump’s initiatives.

Why GM’s Telematics Announcement is a Really Big Deal

Enabling a telematics connection at the factory — and not through an aftermarket hardware installation — is a game changer for fleets.

Four Thoughts From the 2016 Conference Calls

Sifting through the notes of Avis Budget Group’s and Hertz Global Holdings’ recent fourth quarter conference calls give us some trend lines to watch out for in 2017. (Of course, this gives us an incomplete snapshot, as Enterprise Holdings is privately held.)

Job Finder: Access Top Talent. Fill Key Positions.

>