UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 ___________________________________

FORM 10-Q

___________________________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission File Number 1-14387

Commission File Number 1-13663

___________________________________ 

United Rentals, Inc.

United Rentals (North America), Inc.

(Exact Names of Registrants as Specified in Their Charters)

 ___________________________________

Delaware	06-1522496
Delaware	86-0933835
(States of Incorporation)	(I.R.S. Employer Identification Nos.)
100 First Stamford Place, Suite 700
Stamford
Connecticut	06902
(Address of Principal Executive Offices)	(Zip Code)

Registrants’ Telephone Number, Including Area Code: (203) 622-3131

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value, of United Rentals, Inc.	URI	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    x  Yes    o  No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☒	Accelerated Filer	☐
Non-Accelerated Filer	☐	Smaller Reporting Company	☐
Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    ☐Yes    x   No

As of July 22, 2024, there were 66,135,871 shares of United Rentals, Inc. common stock, $0.01 par value, outstanding. There is no market for the common stock of United Rentals (North America), Inc., all outstanding shares of which are owned by United Rentals, Inc.

This combined Form 10-Q is separately filed by (i) United Rentals, Inc. and (ii) United Rentals (North America), Inc. (which is a wholly owned subsidiary of United Rentals, Inc.). United Rentals (North America), Inc. meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this report with the reduced disclosure format permitted by such instruction.

UNITED RENTALS, INC.

UNITED RENTALS (NORTH AMERICA), INC.

FORM 10-Q FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2024

INDEX

		Page
PART I	FINANCIAL INFORMATION
Item 1	Unaudited Condensed Consolidated Financial Statements (unaudited)	6
	United Rentals, Inc. Condensed Consolidated Balance Sheets	6
	United Rentals, Inc. Condensed Consolidated Statements of Income	7
	United Rentals, Inc. Condensed Consolidated Statements of Comprehensive Income	8
	United Rentals, Inc. Condensed Consolidated Statements of Stockholders’ Equity	9
	United Rentals, Inc. Condensed Consolidated Statements of Cash Flows	11
	Notes to Unaudited Condensed Consolidated Financial Statements	12
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3	Quantitative and Qualitative Disclosures About Market Risk	42
Item 4	Controls and Procedures	43
PART II	OTHER INFORMATION
Item 1	Legal Proceedings	44
Item 1A	Risk Factors	44
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 5	Other Information	44
Item 6	Exhibits	45
	Signatures	47

3

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,” “seek,” “on-track,” “plan,” “project,” “forecast,” “intend” or “anticipate,” or the negative thereof or comparable terminology, or by discussions of strategy or outlook. You are cautioned that our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected.

Factors that could cause actual results to differ materially from those projected include, but are not limited to, the following:

•the impact of global economic conditions (including inflation, increased interest rates, supply chain constraints and potential trade wars, sanctions and other conditions related to international conflicts) and public health crises and epidemics on us, our customers and our suppliers, in the United States and the rest of the world;

•declines in construction or industrial activity, which can adversely impact our revenues and, because many of our costs are fixed, our profitability;

•rates we charge and time utilization we achieve being less than anticipated;

•changes in customer, fleet, geographic and segment mix;

•excess fleet in the equipment rental industry;

•inability to benefit from government spending, including spending associated with infrastructure projects, or a reduction in government spending;

•trends in oil and natural gas, including significant increases in the prices of oil or natural gas, could adversely affect the demand for our services and products;

•competition from existing and new competitors;

•the cyclical nature of the industry in which we operate and the industries of our customers, such as those in the construction industry;

•costs we incur being more than anticipated, including as a result of inflation, and the inability to realize expected savings in the amounts or time frames planned;

•our significant indebtedness (which totaled $12.9 billion at June 30, 2024) requires us to use a substantial portion of our cash flow for debt service and can constrain our flexibility in responding to unanticipated or adverse business conditions;

•inability to refinance our indebtedness on terms that are favorable to us, including as a result of volatility and uncertainty in capital or credit markets or increases in interest rates, or at all;

•incurrence of additional debt, which could exacerbate the risks associated with our current level of indebtedness;

•noncompliance with financial or other covenants in our debt agreements, which could result in our lenders terminating the agreements and requiring us to repay outstanding borrowings;

•restrictive covenants and the amount of borrowings permitted under our debt instruments, which can limit our financial and operational flexibility;

•inability to access the capital that our businesses or growth plans may require, including as a result of uncertainty in capital or credit markets;

•the possibility that companies that we have acquired or may acquire could have undiscovered liabilities, or that companies or assets that we have acquired or may acquire could involve other unexpected costs, may strain our management capabilities, or may be difficult to integrate, and that we may not realize the expected benefits from an acquisition over the timeframe we expect, or at all;

•incurrence of impairment charges;

•fluctuations in the price of our common stock and inability to complete stock repurchases or pay dividends in the time frames and/or on the terms anticipated;

•our charter provisions as well as provisions of certain debt agreements and our significant indebtedness may have the effect of making more difficult or otherwise discouraging, delaying or deterring a takeover or other change of control of us;

•inability to manage credit risk adequately or to collect on contracts with a large number of customers;

•turnover in our management team and inability to attract and retain key personnel, as well as loss, absenteeism or the inability of employees to work or perform key functions in light of public health crises or epidemics;

•inability to obtain equipment and other supplies for our business from our key suppliers on acceptable terms or at all, as a result of supply chain disruptions, insolvency, financial difficulties or other factors;

•increases in our maintenance and replacement costs and/or decreases in the residual value of our equipment;

•inability to sell our new or used fleet in the amounts, or at the prices, we expect;

4

•risks related to security breaches, cybersecurity attacks, failure to protect personal information, compliance with privacy, data protection and cyber incident reporting laws and regulations, and other significant disruptions in our information technology systems;

•risks related to climate change and climate change regulation;

•risks related to our environmental and social goals, including our greenhouse gas intensity reduction goal;

•the fact that our holding company structure requires us to depend in part on distributions from subsidiaries and such distributions could be limited by contractual or legal restrictions;

•shortfalls in our insurance coverage;

•increases in our loss reserves to address business operations or other claims and any claims that exceed our established levels of reserves;

•incurrence of expenses (including indemnification obligations) and other costs in connection with litigation, regulatory and investigatory matters;

•the costs of complying with environmental, safety and foreign laws and regulations, as well as other risks associated with non-U.S. operations, including currency exchange risk, and tariffs;

•the outcome or other potential consequences of regulatory and investigatory matters and litigation;

•labor shortages and/or disputes, work stoppages or other labor difficulties, which may impact our productivity and increase our costs, and changes in law that could affect our labor relations or operations generally; and

•the effect of changes in tax law.

For a more complete description of these and other possible risks and uncertainties, please refer to our Annual Report on Form 10-K for the year ended December 31, 2023, as well as to our subsequent filings with the SEC. Our forward-looking statements contained herein speak only as of the date hereof, and we make no commitment to update or publicly release any revisions to forward-looking statements in order to reflect new information or subsequent events, circumstances or changes in expectations.

5

PART I. FINANCIAL INFORMATION

Item 1.Financial Statements

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

	June 30, 2024		December 31, 2023
	(unaudited)
ASSETS
Cash and cash equivalents	$	467	$	363
Accounts receivable, net	2,260		2,230
Inventory	219		205
Prepaid expenses and other assets	273		135
Total current assets	3,219		2,933
Rental equipment, net	14,685		14,001
Property and equipment, net	958		903
Goodwill	6,749		5,940
Other intangible assets, net	744		670
Operating lease right-of-use assets	1,211		1,099
Other long-term assets	47		43
Total assets	$	27,613	$	25,589
LIABILITIES AND STOCKHOLDERS’ EQUITY
Short-term debt and current maturities of long-term debt	$	1,369	$	1,465
Accounts payable	1,349		905
Accrued expenses and other liabilities	1,251		1,267
Total current liabilities	3,969		3,637
Long-term debt	11,520		10,053
Deferred taxes	2,672		2,701
Operating lease liabilities	988		895
Other long-term liabilities	183		173
Total liabilities	19,332		17,459
Common stock—$0.01 par value, 500,000,000 shares authorized, 115,109,208 and 66,235,191 shares issued and outstanding, respectively, at June 30, 2024 and 115,010,396 and 67,269,577 shares issued and outstanding, respectively, at December 31, 2023	1		1
Additional paid-in capital	2,664		2,650
Retained earnings	12,630		11,672
Treasury stock at cost—48,874,017 and 47,740,819 shares at June 30, 2024 and December 31, 2023, respectively	(6,722)		(5,965)
Accumulated other comprehensive loss	(292)		(228)
Total stockholders’ equity	8,281		8,130
Total liabilities and stockholders’ equity	$	27,613	$	25,589

See accompanying notes.

6

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(In millions, except per share amounts)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Revenues:
Equipment rentals	$	3,215	$	2,981	$	6,144	$	5,721
Sales of rental equipment	365		382		748		770
Sales of new equipment	61		70		109		114
Contractor supplies sales	42		37		78		71
Service and other revenues	90		84		179		163
Total revenues	3,773		3,554		7,258		6,839
Cost of revenues:
Cost of equipment rentals, excluding depreciation	1,322		1,216		2,566		2,378
Depreciation of rental equipment	608		592		1,190		1,167
Cost of rental equipment sales	192		186		388		384
Cost of new equipment sales	49		58		87		94
Cost of contractor supplies sales	29		26		54		50
Cost of service and other revenues	55		51		109		100
Total cost of revenues	2,255		2,129		4,394		4,173
Gross profit	1,518		1,425		2,864		2,666
Selling, general and administrative expenses	404		378		793		760
Restructuring charge	1		18		2		19
Non-rental depreciation and amortization	109		104		213		222
Operating income	1,004		925		1,856		1,665
Interest expense, net	173		161		333		311
Other income, net	(4)		(8)		(7)		(12)
Income before provision for income taxes	835		772		1,530		1,366
Provision for income taxes	199		181		352		324
Net income	$	636	$	591	$	1,178	$	1,042
Basic earnings per share	$	9.56	$	8.60	$	17.62	$	15.09
Diluted earnings per share	$	9.54	$	8.58	$	17.57	$	15.04

See accompanying notes.

7

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(In millions)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Net income	$	636	$	591	$	1,178	$	1,042
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments (1)	(13)		23		(64)		24
Fixed price diesel swaps	—		—		—		(1)
Other comprehensive (loss) income (1)	(13)		23		(64)		23
Comprehensive income	$	623	$	614	$	1,114	$	1,065

(1)There were no material reclassifications from accumulated other comprehensive loss reflected in other comprehensive income (loss) during 2024 or 2023. There were no material taxes associated with other comprehensive income (loss) during 2024 or 2023.

See accompanying notes.

8

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

(In millions) 

	Three Months Ended June 30, 2024
	Common Stock							Treasury Stock
	Number of Shares (1) (2)	Amount		Additional Paid-in Capital		Retained Earnings		Number of Shares	Amount		Accumulated Other Comprehensive Loss (3)
Balance at March 31, 2024	67	$	1	$	2,638	$	12,103	48	$	(6,343)	$	(279)
Net income						636
Dividends declared (3)						(109)
Foreign currency translation adjustments											(13)
Stock compensation expense, net	—			27
Tax withholding for share based compensation	—			(1)
Repurchase of common stock	(1)							1	(379)
Balance at June 30, 2024	66	$	1	$	2,664	$	12,630	49	$	(6,722)	$	(292)

	Three Months Ended June 30, 2023
	Common Stock							Treasury Stock
	Number of Shares (1) (2)	Amount		Additional Paid-in Capital		Retained Earnings		Number of Shares	Amount		Accumulated Other Comprehensive Loss (3)
Balance at March 31, 2023	69	$	1	$	2,598	$	10,003	46	$	(5,208)	$	(264)
Net income						591
Dividends declared (3)						(101)
Foreign currency translation adjustments											23
Stock compensation expense, net	—			25
Tax withholding for share based compensation	—			(2)
Repurchase of common stock	(1)							1	(252)
Balance at June 30, 2023	68	$	1	$	2,621	$	10,493	47	$	(5,460)	$	(241)

9

	Six Months Ended June 30, 2024
	Common Stock							Treasury Stock
	Number of Shares (1)	Amount		Additional Paid-in Capital		Retained Earnings		Number of Shares	Amount		Accumulated Other Comprehensive Loss (2)
Balance at December 31, 2023	67	$	1	$	2,650	$	11,672	48	$	(5,965)	$	(228)
Net income						1,178
Dividends declared (3)						(220)
Foreign currency translation adjustments											(64)
Stock compensation expense, net	—			55
Tax withholding for share based compensation	—			(41)
Repurchase of common stock	(1)							1	(757)
Balance at June 30, 2024	66	$	1	$	2,664	$	12,630	49	$	(6,722)	$	(292)

	Six Months Ended June 30, 2023
	Common Stock							Treasury Stock
	Number of Shares (1)	Amount		Additional Paid-in Capital		Retained Earnings		Number of Shares	Amount		Accumulated Other Comprehensive Loss (2)
Balance at December 31, 2022	69	$	1	$	2,626	$	9,656	45	$	(4,957)	$	(264)
Net income						1,042
Dividends declared (3)						(205)
Foreign currency translation adjustments											24
Fixed price diesel swaps											(1)
Stock compensation expense, net	1			49
Tax withholding for share based compensation	—			(54)
Repurchase of common stock	(2)							2	(503)
Balance at June 30, 2023	68	$	1	$	2,621	$	10,493	47	$	(5,460)	$	(241)

(1)Common stock outstanding decreased by approximately two million net shares during the year ended December 31, 2023.

(2)The Accumulated Other Comprehensive Loss balance primarily reflects foreign currency translation adjustments.

(3)We declared dividends of $1.63 and $1.48 per share during the three months ended June 30, 2024 and 2023, respectively, and $3.26 and $2.96 per share during the six months ended June 30, 2024 and 2023, respectively.

See accompanying notes.

10

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In millions)

	Six Months Ended
	June 30,
	2024		2023
Cash Flows From Operating Activities:
Net income	$	1,178	$	1,042
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,403		1,389
Amortization of deferred financing costs and original issue discounts	7		7
Gain on sales of rental equipment	(360)		(386)
Gain on sales of non-rental equipment	(8)		(10)
Insurance proceeds from damaged equipment	(24)		(19)
Stock compensation expense, net	55		49
Restructuring charge	2		19
Loss on repurchase/redemption/amendment of debt securities	1		—
(Decrease) increase in deferred taxes	(32)		53
Changes in operating assets and liabilities, net of amounts acquired:
Decrease (increase) in accounts receivable	66		(115)
(Increase) decrease in inventory	(7)		5
(Increase) decrease in prepaid expenses and other assets	(90)		134
Increase in accounts payable	250		205
Decrease in accrued expenses and other liabilities	(147)		(145)
Net cash provided by operating activities	2,294		2,228
Cash Flows From Investing Activities:
Payments for purchases of rental equipment	(1,866)		(2,048)
Payments for purchases of non-rental equipment and intangible assets	(165)		(179)
Proceeds from sales of rental equipment	748		770
Proceeds from sales of non-rental equipment	30		28
Insurance proceeds from damaged equipment	24		19
Purchases of other companies, net of cash acquired	(1,234)		(418)
Purchases of investments	(3)		—
Net cash used in investing activities	(2,466)		(1,828)
Cash Flows From Financing Activities:
Proceeds from debt	6,911		4,488
Payments of debt	(5,597)		(4,007)
Common stock repurchased, including tax withholdings for share based compensation	(791)		(554)
Payments of financing costs	(17)		—
Dividends paid	(219)		(205)
Net cash provided by (used in) financing activities	287		(278)
Effect of foreign exchange rates	(11)		(1)
Net increase in cash and cash equivalents	104		121
Cash and cash equivalents at beginning of period	363		106
Cash and cash equivalents at end of period	$	467	$	227
Supplemental disclosure of cash flow information:
Cash paid for income taxes, net	$	606	$	212
Cash paid for interest	317		305

See accompanying notes.

11

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share data, unless otherwise indicated)

1. Organization, Description of Business and Basis of Presentation

United Rentals, Inc. (“Holdings,” “URI” or the “Company”) is principally a holding company and conducts its operations primarily through its wholly owned subsidiary, United Rentals (North America), Inc. (“URNA”), and subsidiaries of URNA. Holdings’ primary asset is its sole ownership of all issued and outstanding shares of common stock of URNA. URNA’s various credit agreements and debt instruments place restrictions on its ability to transfer funds to its shareholder.

We rent equipment to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. We primarily operate in the United States and Canada, and have a limited presence in Europe, Australia and New Zealand. In addition to renting equipment, we sell new and used rental equipment, as well as related contractor supplies, parts and service.

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the accounting policies described in our annual report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”) and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the 2023 Form 10-K.

In our opinion, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented have been made. Interim results of operations are not necessarily indicative of the results of the full year.

New Accounting Pronouncements

Improvements to Reportable Segment Disclosures. In November 2023, the FASB issued ASU 2023-07, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in the ASU require, among other things, disclosure of significant segment expenses that are regularly provided to an entity's chief operating decision maker (“CODM”) and a description of other segment items (the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss) by reportable segment, as well as disclosure of the title and position of the CODM, and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. Annual disclosures are required for fiscal years beginning after December 15, 2023 and interim disclosures are required for periods within fiscal years beginning after December 15, 2024. Retrospective application is required, and early adoption is permitted. These requirements are not expected to have an impact on our financial statements, but will result in significantly expanded reportable segment disclosures.

Improvements to Income Tax Disclosures. In December 2023, the FASB issued ASU 2023-09, which requires disclosure of disaggregated income taxes paid, prescribes standard categories for the components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, may be applied prospectively or retrospectively, and allows for early adoption. These requirements are not expected to have an impact on our financial statements, but will impact our income tax disclosures.

2. Revenue Recognition

Revenue Recognition Accounting Standards

We recognize revenue in accordance with two different accounting standards: 1) Topic 606 (which addresses revenue from contracts with customers) and 2) Topic 842 (which addresses lease revenue). Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. As reflected below, most of our revenue is accounted for under Topic 842. Our contracts with customers generally do not include multiple performance obligations. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services.

12

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

Nature of goods and services

In the following table, revenue is summarized by type and by the applicable accounting standard.

	Three Months Ended June 30,
			2024						2023
	Topic 842		Topic 606		Total		Topic 842		Topic 606		Total
Revenues:
Owned equipment rentals	$	2,604	$	—	$	2,604	$	2,461	$	—	$	2,461
Re-rent revenue	58		—		58		56		—		56
Ancillary and other rental revenues:
Delivery and pick-up	—		267		267		—		238		238
Other	241		45		286		185		41		226
Total ancillary and other rental revenues	241		312		553		185		279		464
Total equipment rentals	2,903		312		3,215		2,702		279		2,981
Sales of rental equipment	—		365		365		—		382		382
Sales of new equipment	—		61		61		—		70		70
Contractor supplies sales	—		42		42		—		37		37
Service and other revenues	—		90		90		—		84		84
Total revenues	$	2,903	$	870	$	3,773	$	2,702	$	852	$	3,554

	Six Months Ended June 30,
			2024						2023
	Topic 842		Topic 606		Total		Topic 842		Topic 606		Total
Revenues:
Owned equipment rentals	$	5,008	$	—	$	5,008	$	4,727	$	—	$	4,727
Re-rent revenue	113		—		113		108		—		108
Ancillary and other rental revenues:
Delivery and pick-up	—		481		481		—		441		441
Other	442		100		542		350		95		445
Total ancillary and other rental revenues	442		581		1,023		350		536		886
Total equipment rentals	5,563		581		6,144		5,185		536		5,721
Sales of rental equipment	—		748		748		—		770		770
Sales of new equipment	—		109		109		—		114		114
Contractor supplies sales	—		78		78		—		71		71
Service and other revenues	—		179		179		—		163		163
Total revenues	$	5,563	$	1,695	$	7,258	$	5,185	$	1,654	$	6,839

Revenues by reportable segment are presented in note 4 of the condensed consolidated financial statements, using the revenue captions reflected in our condensed consolidated statements of operations. The majority of our revenue is recognized in our general rentals segment and in the U.S. (for the six months ended June 30, 2024, 72 percent and 91 percent, respectively). We believe that the disaggregation of our revenue from contracts to customers as reflected above, coupled with the further discussion below and the reportable segment disclosures in note 4, depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Lease revenues (Topic 842)

The accounting for the types of revenue that are accounted for under Topic 842 is discussed below.

Owned equipment rentals represent our most significant revenue type (they accounted for 69 percent of total revenues for the six months ended June 30, 2024) and are governed by our standard rental contract. We account for such rentals as operating leases. The lease terms are included in our contracts, and the determination of whether our contracts contain leases generally does not require significant assumptions or judgments. Our lease revenues do not include material amounts of variable payments.

13

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

Owned equipment rentals: Owned equipment rentals represent revenues from renting equipment that we own. We do not generally provide an option for the lessee to purchase the rented equipment at the end of the lease, and do not generate material revenue from sales of equipment under such options.

We recognize revenues from renting equipment on a straight-line basis. Our rental contract periods are hourly, daily, weekly or monthly. By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day. The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days. This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply.

As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, we will have customers return equipment and be contractually required to pay us more than the cumulative amount of revenue recognized to date under the straight-line methodology. For instance, continuing the above example, if the customer rented the above piece of equipment on December 29 and returned it at the close of business on January 1, we would recognize incremental revenue on January 1 of $171.44 (in actual dollars, representing the difference between the amount the customer is contractually required to pay, or $300 at the weekly rate, and the cumulative amount recognized to date on a straight-line basis, or $128.56, which represents four days at $32.14 per day).

We record amounts billed to customers in excess of recognizable revenue as deferred revenue on our balance sheet. We had deferred revenue (associated with both Topic 842 and Topic 606) of $155 and $138 as of June 30, 2024 and December 31, 2023, respectively.

As noted above, we are unsure of when the customer will return rented equipment. As such, we do not know how much the customer will owe us upon return of the equipment and cannot provide a maturity analysis of future lease payments. Our equipment is generally rented for short periods of time. Lessees do not provide residual value guarantees on rented equipment.

We expect to derive significant future benefits from our equipment following the end of the rental term. Our rentals are generally short-term in nature, and our equipment is typically rented for the majority of the time that we own it. We additionally recognize revenue from sales of rental equipment when we dispose of the equipment.

Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above.

“Other” equipment rental revenue is primarily comprised of 1) Rental Protection Plan (or "RPP") revenue associated with the damage waiver customers can purchase when they rent our equipment to protect against potential loss or damage, 2) environmental charges associated with the rental of equipment, 3) charges for rented equipment that is damaged by our customers and 4) charges for setup and other services performed on rented equipment.

Revenues from contracts with customers (Topic 606)

The accounting for the types of revenue that are accounted for under Topic 606 is discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time.

Delivery and pick-up: Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed.

“Other” equipment rental revenue is primarily comprised of revenues associated with the consumption of fuel by our customers which are recognized when the equipment is returned by the customer (and consumption, if any, can be measured).

Sales of rental equipment, new equipment and contractor supplies are recognized at the time of delivery to, or pick-up by, the customer and when collectibility is probable.

Service and other revenues primarily represent revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). Service revenue is recognized as the services are performed.

14

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

Receivables and contract assets and liabilities

As reflected above, most of our equipment rental revenue is accounted for under Topic 842 (such revenue represented 77 percent of our total revenues for the six months ended June 30, 2024). The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. Because the same customers generate the revenues that are accounted for under both Topic 606 and Topic 842, the discussions below on credit risk and our allowance for credit losses address receivables arising from revenues from both Topic 606 and Topic 842.

Concentration of credit risk with respect to our receivables is limited because a large number of geographically diverse customers makes up our customer base. Our largest customer accounted for one percent or less of total revenues for the six months ended June 30, 2024, and for each of the last three full years. Our customer with the largest receivable balance represented approximately one percent of total receivables at June 30, 2024 and December 31, 2023. We manage credit risk through credit approvals, credit limits and other monitoring procedures.

Our allowance for credit losses reflects our estimate of the amount of our receivables that we will be unable to collect based on historical write-off experience and, as applicable, current conditions and reasonable and supportable forecasts that affect collectibility. Our estimate could require change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance. Trade receivables that have contractual maturities of one year or less are written-off when they are determined to be uncollectible based on the criteria necessary to qualify as a deduction for federal tax purposes. Write-offs of such receivables require management approval based on specified dollar thresholds. See the table below for a rollforward of our allowance for credit losses.

The measurement of expected credit losses is based on relevant information from past events, including historical experiences, current conditions and reasonable and supportable forecasts that affect collectibility. Trade receivables are the only material financial asset we have that is subject to the requirement to measure expected credit losses as noted above, as this requirement does not apply to receivables arising from operating lease revenues. Substantially all of our non-lease trade receivables are due in one year or less. As discussed above, most of our equipment rental revenue is accounted for as lease revenue (such revenue represented 77 percent of our total revenues for the six months ended June 30, 2024, and these revenues account for corresponding portions of the $2.260 billion of net accounts receivable and the associated allowance for credit losses of $176 as of June 30, 2024).

As discussed above, most of our equipment rental revenue is accounted for under Topic 842. The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. The rollforward of our allowance for credit losses (in total, and associated with revenues arising from both Topic 606 and Topic 842) is shown below.

	Three Months Ended June 30, 2024		Three Months Ended June 30, 2023		Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Beginning balance	$	174	$	146	$	169	$	134
Charged to costs and expenses (1)	3		2		7		5
Charged to revenue (2)	14		8		23		21
Deductions and other (3)	(15)		(9)		(23)		(13)
Ending balance	$	176	$	147	$	176	$	147

_________________

(1)    Reflects bad debt expenses recognized within selling, general and administrative expenses (associated with Topic 606 revenues).

(2)    Primarily reflects credit losses associated with lease revenues that were recognized as a reduction to equipment rentals revenue (primarily associated with Topic 842 revenues).

(3)    Primarily represents write-offs of accounts, net of immaterial recoveries and other activity.

We do not have material contract assets, or impairment losses associated therewith, or material contract liabilities, associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to

15

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

customers in excess of recognizable revenue. We did not recognize material revenue during the three or six months ended June 30, 2024 or 2023 that was included in the contract liability balance as of the beginning of such periods.

Performance obligations

Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amounts of such revenue recognized during the three and six months ended June 30, 2024 and 2023 were not material. We also do not expect to recognize material revenue in the future related to performance obligations that were unsatisfied (or partially unsatisfied) as of June 30, 2024.

Payment terms

Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk.

Revenue is recognized net of taxes collected from customers, which are subsequently remitted to governmental authorities.

Contract costs

We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.

Contract estimates and judgments

Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments, primarily for the following reasons:

•The transaction price is generally fixed and stated in our contracts;

•As noted above, our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation;

•Our revenues do not include material amounts of variable consideration, or result in significant obligations associated with returns, refunds or warranties; and

•Most of our revenue is recognized as of a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenue is generally recognized at the time of delivery to, or pick-up by, the customer.

Our revenues accounted for under Topic 842 also generally do not require significant estimates or judgments. We monitor and review our estimated standalone selling prices on a regular basis.

16

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

3. Acquisitions

On March 15, 2024, we completed the acquisition of Yak Access, LLC, Yak Mat, LLC and New South Access & Environmental Solutions, LLC (collectively, “Yak”). Yak was a leader in the North American matting industry with a fleet of approximately 600,000 hardwood, softwood, and composite mats that provide surface protection across both construction and maintenance, repair and operations (“MRO”) applications, and served customers primarily in the industrial sector across over 40 states. The acquisition is expected to:

• Provide entry into the matting market via an industry leader with established scale across fleet, operations, and talent;

• Augment exposure to the energy and power verticals, where significant investment is expected over the next several decades; and

• Enhance our one-stop-shop value proposition with immediate cross-selling opportunities to existing and new construction and MRO customers.

The acquisition date fair value of the purchase price to acquire Yak was $1.156 billion, comprised of cash and $39 of estimated contingent consideration ($50 is the maximum amount of contingent consideration) that could become payable to the seller based on revenue attainment in the first two years after closing. The acquisition and related fees and expenses were funded through the issuance of $1.100 billion principal amount of 6 1/8 Senior Notes (see note 7 to the condensed consolidated financial statements for further information) and drawings on our senior secured asset-based revolving credit facility (“ABL facility”).

The following table summarizes the net book values of the assets acquired and liabilities assumed as of the acquisition date. The initial accounting for the acquisition is incomplete, principally related to finalizing 1) the measurement of the acquired net working capital, 2) the valuation of the acquired equipment (inclusive of the completion of our usual and customary procedures to validate the existence of the acquired rental fleet) and intangible assets, 3) the impact of lease accounting, 4) the valuation of the contingent consideration noted above and 5) the associated income tax considerations. All amounts below could change, potentially materially, as there is significant additional information that we must obtain to finalize the valuations of the assets acquired and liabilities assumed. During the three months ended June 30, 2024, we recognized measurement period adjustments primarily to establish preliminary values for intangibles assets, which also resulted in a reduction in goodwill from the previously reported preliminary amount.

Accounts receivable (1)	$	99
Inventory	8
Rental equipment	143
Property and equipment	32
Intangible assets (customer relationships) (2)	150
Operating lease right-of-use assets	6
Other assets	17
Total identifiable assets acquired	455
Accounts payable, accrued expenses and other liabilities	(103)
Operating lease liabilities	(6)
Total liabilities assumed	(109)
Net identifiable assets acquired	346
Goodwill (3)	810
Net assets acquired	$	1,156

     ___________________

(1)The estimated fair value of accounts receivables acquired was $99, and the gross contractual amount was $102. We estimated that $3 would be uncollectible.

(2)The customer relationships are being amortized over a 6 year life.

(3)All of the goodwill was assigned to our specialty segment. As noted above, we have not yet obtained all the information required to finalize the valuations of the assets acquired and liabilities assumed. As such, we expect that goodwill will change from the amount noted above. Once finalized, we expect that the goodwill that results from the acquisition will be

17

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

primarily reflective of Yak's going-concern value, the value of Yak's assembled workforce and new customer relationships expected to arise from the acquisition. All of the goodwill is expected to be deductible for income tax purposes (because the acquired Yak entities were sold as disregarded entities, the acquisition was treated as an asset purchase for income tax purposes, which resulted in the goodwill that is deductible for income tax purposes equaling the total acquired goodwill).

The debt issuance costs associated with the issuance of debt to partially fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our consolidated balance sheets. The total post-acquisition revenue attributable to the acquired Yak locations was $87 and $102 for the three and six months ended June 30, 2024, respectively. It is not practicable to reasonably estimate the amount of earnings of Yak since the acquisition date, primarily due to our corporate structure and the allocation of corporate costs.

Pro forma financial information

The pro forma information below gives effect to the Yak acquisition as if it had been completed on January 1, 2023. Pro forma information for the three months ended June 30, 2024 is excluded from the presentation below because Yak was included in our results for the entire period. The pro forma information is not necessarily indicative of our results had the acquisition been completed on the above date, nor is it necessarily indicative of our future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition and also does not reflect additional revenue opportunities following the acquisition. The pro forma information includes adjustments to record the acquired assets and liabilities of Yak at their respective fair values and to give effect to the financing for the acquisition. The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed. The purchase price allocations for the assets acquired and liabilities assumed are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact our statements of income in future periods. The table below presents unaudited pro forma consolidated income statement information as if Yak had been included in our consolidated results for the entire periods reflected:

	Three Months Ended		Six Months Ended
	June 30,		June 30,
	2023		2024		2023
United Rentals historic revenue (1)	$	3,554	$	7,258	$	6,839
Yak historic revenue (2)	93		97		184
Pro forma revenue (1)	3,647		7,355		7,023
United Rentals historic pretax income	772		1,530		1,366
Yak historic pretax (loss) income	(9)		10		77
Combined pretax income	763		1,540		1,443
Pro forma adjustments to combined pretax income:
Impact of fair value mark-ups/useful life changes on depreciation (3)	(2)		(1)		(4)
Intangible asset amortization (4)	(4)		(2)		(9)
Interest expense (5)	(17)		(14)		(34)
Elimination of historic interest (6)	16		11		39
Elimination of refinancing transactions (7)	1		(40)		(101)
Transaction bonuses and other (8)	1		22		2
Pro forma pretax income	$	758	$	1,516	$	1,336

___________________

(1)United Rentals historic revenue for the six months ended June 30, 2024 includes the post-acquisition revenue attributable to the acquired Yak locations of $102 that is discussed above. Pro forma revenue for the six months ended June 30, 2024 includes $199 of pre/post-acquisition revenue from the acquired Yak locations, comprised of $97 of historic Yak revenue and $102 of post-acquisition revenue attributable to the acquired Yak locations.

(2)Yak revenue reflects only the historical results of the entities being acquired, and includes an estimate of revenue from mat rentals to a commonly controlled entity that were eliminated in consolidation by Yak.

18

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

(3)Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups of the equipment acquired in the Yak acquisition. There were no material changes to the useful lives and salvage values of the acquired equipment.

(4)Intangible asset amortization was adjusted to include amortization of the acquired intangible assets.

(5)As discussed above, the acquisition and related fees and expenses were funded through the issuance of senior notes and drawings on our ABL facility. Interest expense was adjusted to reflect interest on the debt used to finance the acquisition.

(6)Historic interest on debt that is not part of the combined entity was eliminated.

(7)Reflects gains on the extinguishment of debt, net of refinancing transaction expenses.

(8)Primarily reflects bonuses paid in connection with the acquisition.

During 2024 and 2023, we completed other acquisitions that were not significant individually or in the aggregate. See the condensed consolidated statements of cash flows for the total cash outflow for purchases of other companies (including Yak), net of cash acquired.

19

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

4. Segment Information

Our reportable segments are i) general rentals and ii) specialty. For general rentals, the divisions discussed below, which are our operating segments, are aggregated into the reportable segment. The specialty segment is a single division that is both an operating segment and a reportable segment. We believe that the divisions that are aggregated into our reportable segments have similar economic characteristics, as each division is capital intensive, offers similar products to similar customers, uses similar methods to distribute its products, and is subject to similar competitive risks. The aggregation of our divisions also reflects the management structure that we use for making operating decisions and assessing performance. We evaluate segment performance primarily based on segment equipment rentals gross profit.

The general rentals segment includes the rental of i) general construction and industrial equipment, such as backhoes, skid-steer loaders, forklifts, earthmoving equipment and material handling equipment, ii) aerial work platforms, such as boom lifts and scissor lifts and iii) general tools and light equipment, such as pressure washers, water pumps and power tools. The general rentals segment reflects the aggregation of four geographic divisions—Central, Northeast, Southeast and West—and operates throughout the United States and Canada.

The specialty segment, which, as noted above, is a single division that is both an operating segment and a reportable segment, rents products (and provides setup and other services on such rented equipment) including i) trench safety equipment, such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, ii) power and HVAC equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment, iii) fluid solutions equipment primarily used for fluid containment, transfer and treatment, iv) mobile storage equipment and modular office space and v) surface protection mats. The specialty segment’s customers include construction companies involved in infrastructure projects, municipalities and industrial companies. This segment primarily operates in the United States and Canada, and has a limited presence in Europe, Australia and New Zealand.

20

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

The following tables set forth financial information by segment.

	General rentals		Specialty		Total
Three Months Ended June 30, 2024
Equipment rentals	$	2,209	$	1,006	$	3,215
Sales of rental equipment	313		52		365
Sales of new equipment	27		34		61
Contractor supplies sales	23		19		42
Service and other revenues	81		9		90
Total revenue	2,653		1,120		3,773
Depreciation and amortization expense	541		176		717
Equipment rentals gross profit	802		483		1,285
Three Months Ended June 30, 2023
Equipment rentals	$	2,189	$	792	$	2,981
Sales of rental equipment	342		40		382
Sales of new equipment	24		46		70
Contractor supplies sales	23		14		37
Service and other revenues	75		9		84
Total revenue	2,653		901		3,554
Depreciation and amortization expense	580		116		696
Equipment rentals gross profit	788		385		1,173
Six Months Ended June 30, 2024
Equipment rentals	$	4,279	$	1,865	$	6,144
Sales of rental equipment	659		89		748
Sales of new equipment	56		53		109
Contractor supplies sales	43		35		78
Service and other revenues	162		17		179
Total revenue	5,199		2,059		7,258
Depreciation and amortization expense	1,115		288		1,403
Equipment rentals gross profit	1,483		905		2,388
Capital expenditures (1)	1,658		523		2,181
Six Months Ended June 30, 2023
Equipment rentals	$	4,207	$	1,514	$	5,721
Sales of rental equipment	692		78		770
Sales of new equipment	42		72		114
Contractor supplies sales	44		27		71
Service and other revenues	147		16		163
Total revenue	5,132		1,707		6,839
Depreciation and amortization expense	1,157		232		1,389
Equipment rentals gross profit	1,451		725		2,176
Capital expenditures (1)	1,766		461		2,227

 ___________________

(1)The condensed consolidated statements of cash flows include the payments for capital expenditures, while the table above reflects the gross capital expenditures. Accounts payable as of June 30, 2024 and December 31, 2023 included $224 and $74, respectively, of amounts due but unpaid for purchases of rental equipment. The net impact of accrued purchases of rental equipment was not material for the six months ended June 30, 2023.

21

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

	June 30, 2024		December 31, 2023
Total reportable segment assets
General rentals	$	20,804	$	20,411
Specialty (1)	6,809		5,178
Total assets	$	27,613	$	25,589

  ___________________

(1)The increase in the specialty segment assets primarily reflects the impact of the Yak acquisition discussed in note 3 to the condensed consolidated financial statements.  

Equipment rentals gross profit is the primary measure management reviews to make operating decisions and assess segment performance. The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2024		2023		2024		2023
Total equipment rentals gross profit	$	1,285	$	1,173	$	2,388	$	2,176
Gross profit from other lines of business	233		252		476		490
Selling, general and administrative expenses	(404)		(378)		(793)		(760)
Restructuring charge (1)	(1)		(18)		(2)		(19)
Non-rental depreciation and amortization	(109)		(104)		(213)		(222)
Interest expense, net	(173)		(161)		(333)		(311)
Other income, net	4		8		7		12
Income before provision for income taxes	$	835	$	772	$	1,530	$	1,366

 ___________________

(1)Primarily reflects severance and branch closure charges associated with our restructuring programs. The restructuring charges generally involve the closure of a large number of branches over a short period of time, often in periods following a major acquisition. The amounts above primarily reflect charges associated with the restructuring program initiated following the December 2022 acquisition of Ahern Rentals, Inc. As of June 30, 2024, there were no open restructuring programs.

22

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

5. Goodwill and Other Intangible Assets

The following table presents the changes in the carrying amount of goodwill for the six months ended June 30, 2024:

	General rentals		Specialty		Total
Balance at January 1, 2024 (1)	$	4,775	$	1,165	$	5,940
Goodwill related to acquisitions (2)	5		820		825
Foreign currency translation and other adjustments	(7)		(9)		(16)
Balance at June 30, 2024 (1)	$	4,773	$	1,976	$	6,749

 

_________________

(1)The total carrying amount of goodwill for all periods in the table above is reflected net of $1.557 billion of accumulated impairment charges, which were primarily recorded in our general rentals segment.

(2)Includes goodwill adjustments for the effect on goodwill of changes to net assets acquired during the measurement period. The goodwill related to acquisitions above primarily reflects the March 2024 acquisition of Yak, which is discussed note 3 to our condensed consolidated financial statements.

Other intangible assets were comprised of the following at June 30, 2024 and December 31, 2023:  

	June 30, 2024
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	3 years		$	169		$	70		$	99
Customer relationships	6 years		$	2,666		$	2,023		$	643
Trade names and associated trademarks	2 years		$	8		$	6		$	2

	December 31, 2023
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	4 years		$	176		$	58		$	118
Customer relationships	6 years		$	2,468		$	1,919		$	549
Trade names and associated trademarks	2 years		$	9		$	6		$	3

Our other intangibles assets, net at June 30, 2024 includes the assets in the table below associated with the acquisition of Yak that is discussed in note 3 to our condensed consolidated financial statements. No residual value has been assigned to these assets. The customer relationships are being amortized using the sum of the years' digits method, and we believe that this method best reflects the estimated pattern in which the economic benefits will be consumed. The intangible asset values are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period.

	June 30, 2024
	Weighted-Average Remaining Amortization Period	Net Carrying Amount
Customer relationships	6 years	139

Amortization expense for other intangible assets was $66 and $65 for the three months ended June 30, 2024 and 2023, respectively, and $126 and $144 for the six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024, estimated amortization expense for other intangible assets for each of the next five years and thereafter is as follows:  

23

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

2024		$	125
2025	213
2026	162
2027	111
2028	61
Thereafter	72
Total		$	744

6. Fair Value Measurements

As of June 30, 2024 and December 31, 2023, the amounts of our assets and liabilities that were accounted for at fair value were immaterial.

Fair value measurements are categorized in one of the following three levels based on the lowest level input that is significant to the fair value measurement in its entirety:

Level 1- Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2- Observable inputs other than quoted prices in active markets for identical assets or liabilities include:

a)quoted prices for similar assets or liabilities in active markets;

b)quoted prices for identical or similar assets or liabilities in inactive markets;

c)inputs other than quoted prices that are observable for the asset or liability;

d)inputs that are derived principally from or corroborated by observable market data by correlation or other means.

If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3- Inputs to the valuation methodology are unobservable (i.e., supported by little or no market activity) and significant to the fair value measure.

Fair Value of Financial Instruments

The carrying amounts reported in our condensed consolidated balance sheets for accounts receivable, accounts payable and accrued expenses and other liabilities approximate fair value due to the immediate to short-term maturity of these financial instruments. The fair values of our variable rate debt facilities and finance leases approximated their book values as of June 30, 2024 and December 31, 2023. The estimated fair values of our other financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of June 30, 2024 and December 31, 2023 have been calculated based upon available market information, and were as follows: 

	June 30, 2024				December 31, 2023
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Senior notes	$	8,817	$	8,459	$	7,720	$	7,442

7. Debt

Debt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following:

24

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

	June 30, 2024		December 31, 2023
Repurchase facility (terminated in 2024) (1)	$	—	$	100
Accounts receivable securitization facility expiring 2025 (1) (2)	1,289		1,300
$4.25 billion ABL facility expiring 2027 (1)	1,571		1,261
Term loan facility expiring 2031 (1) (3)	988		945
5 1/2 percent Senior Notes due 2027	499		498
3 7/8 percent Senior Secured Notes due 2027	746		745
4 7/8 percent Senior Notes due 2028 (4)	1,666		1,665
6 percent Senior Secured Notes due 2029	1,489		1,488
5 1/4 percent Senior Notes due 2030	745		745
4 percent Senior Notes due 2030	745		744
3 7/8 percent Senior Notes due 2031	1,092		1,091
3 3/4 percent Senior Notes due 2032	745		744
6 1/8 percent Senior Notes due 2034 (5)	1,090		—
Finance leases	224		192
Total debt	12,889		11,518
Less short-term portion (6)	(1,369)		(1,465)
Total long-term debt	$	11,520	$	10,053

 ___________________

(1)The table below presents financial information associated with our variable rate indebtedness as of and for the six months ended June 30, 2024. The repurchase facility is not included below because (i) there were no borrowings under it during the six months ended June 30, 2024 and (ii) it was terminated in May 2024. We have borrowed the full available amount under the term loan facility. The principal obligation under the term loan facility is required to be repaid in quarterly installments in an aggregate amount equal to 1.0 percent per annum, with the balance due at the maturity of the facility. The average amount of debt outstanding under the term loan facility decreases slightly each quarter due to the requirement to repay a portion of the principal obligation.

	ABL facility			Accounts receivable securitization facility			Term loan facility
Borrowing capacity, net of letters of credit	$	2,653		$	147		$	—
Letters of credit	18
Interest rate at June 30, 2024	6.5		%	6.3		%	7.1		%
Average month-end debt outstanding	1,354			1,156			991
Weighted-average interest rate on average debt outstanding	6.5		%	6.3		%	7.1		%
Maximum month-end debt outstanding	1,578			1,290			1,000

(2)In May 2024, the accounts receivable securitization facility was amended, primarily to increase the facility size and extend the maturity date. The size of the facility, which expires on June 24, 2025, was increased to $1.5 billion. The facility may be extended on a 364-day basis by mutual agreement with the purchasers under the facility. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of June 30, 2024, there were $1.437 billion of receivables, net of applicable reserves and other deductions, in the collateral pool.

(3)In February 2024, the term loan facility was amended, primarily to extend the maturity date to February 14, 2031 and to increase the facility size to $1.000 billion (at the time of the amendment, the facility size was $948).

(4)URNA separately issued 4 7/8 percent Senior Notes in August 2017 and in September 2017. Following the issuances, URNA consummated an exchange offer pursuant to which most of the 4 7/8 percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 7/8 percent Senior Notes issued in August 2017. As of June 30, 2024, the total above is comprised of two separate 4 7/8 percent Senior Notes, one with a book value of $1.662 billion and one with a book value of $4.

(5)In March 2024, URNA issued $1.100 billion aggregate principal amount of 6 1/8 percent Senior Notes (the “6 1/8 percent Notes”) which are due March 15, 2034. The 6 1/8 percent Notes are unsecured and are guaranteed by Holdings and certain domestic subsidiaries of URNA. The 6 1/8 percent Notes may be redeemed on or after March 15, 2029, at specified redemption prices that range from 103.063 percent in 2029, to