Segment Information

6 Months Ended

Jun. 30, 2022

Segment Reporting [Abstract]

Segment Information

Segment Information

Our chief operating decision-maker assesses performance and allocates resources based upon the separate financial information from each of our operating segments. In identifying our reportable segments, we considered the nature of services provided, the geographical areas in which the segments operated and other relevant factors. We aggregate certain of our operating segments into our reportable segments.

Management evaluates the operating results of each of its reportable segments based upon revenues and “Adjusted EBITDA,” which we define as income (loss) from continuing operations before non-vehicle related depreciation and amortization, any impairment charges, restructuring and other related charges, early extinguishment of debt costs, non-vehicle related interest, transaction-related costs, net, charges for unprecedented personal-injury and other legal matters, net, which includes amounts recorded in excess of $5 million related to class action lawsuits, non-operational charges related to shareholder activist activity, which include third party advisory, legal and other professional service fees, COVID-19 charges and income taxes. COVID-19 charges include unusual, direct and incremental costs due to the COVID-19 pandemic such as minimum annual guaranteed rent in excess of concession fees for the period, overflow parking for idle vehicles and related shuttling costs, incremental cleaning supplies to sanitize vehicles and facilities, and losses associated with vehicles damaged in overflow parking lots, net of insurance proceeds. Our presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies.

			Three Months Ended June 30,
			2022				2021
			Revenues		Adjusted EBITDA		Revenues		Adjusted EBITDA
Americas			$	2,567	$	1,041	$	1,974	$	634
International			677		183		397		8
Corporate and Other (a)			—		(19)		—		(18)
	Total Company		$	3,244	$	1,205	$	2,371	$	624
Reconciliation of Adjusted EBITDA to income before income taxes:
					2022				2021
Adjusted EBITDA					$	1,205			$	624
Less:		Non-vehicle related depreciation and amortization (b)			53				67
		Interest expense related to corporate debt, net:
		Interest expense			64				59
		Restructuring and other related charges			6				22
		Unprecedented personal-injury and other legal    matters, net (c)			—				(11)
		Transaction-related costs, net			1				1
		COVID-19 charges (d)			(2)				—
Income before income taxes					$	1,083			$	486

__________

(a)Includes unallocated corporate overhead which is not attributable to a particular segment.

(b)For the three months ended June 30, 2022, includes operating expenses in our Consolidated Condensed Statements of Comprehensive Income related to cloud computing costs of $2 million. For the three months ended June 30, 2021, includes operating expenses and selling, general and administrative expenses related to cloud computing costs of $3 million and $2 million, respectively, in our Consolidated Condensed Statements of Comprehensive Income.

(c)Reported within operating expenses.

(d)The following table presents the unusual, direct and incremental costs due to the COVID-19 pandemic:

	2022		2021
Minimum annual guaranteed rent in excess of concession fees, net	$	(2)	$	(3)
Vehicles damaged in overflow parking lots, net of insurance proceeds	—		2
Other charges	—		1
Operating expenses	$	(2)	$	—
COVID-19 charges, net	$	(2)	$	—

			Six Months Ended June 30,
			2022				2021
			Revenues		Adjusted EBITDA		Revenues		Adjusted EBITDA
Americas			$	4,567	$	1,851	$	3,054	$	742
International			1,109		206		689		(42)
Corporate and Other (a)			—		(42)		—		(29)
	Total Company		$	5,676	$	2,015	$	3,743	$	671
Reconciliation of Adjusted EBITDA to income before income taxes:
					2022				2021
Adjusted EBITDA					$	2,015			$	671
Less:		Non-vehicle related depreciation and amortization (b)			113				135
		Interest expense related to corporate debt, net:
		Interest expense			117				120
		Early extinguishment of debt			—				129
		Restructuring and other related charges			14				42
		Unprecedented personal-injury and other legal    matters, net (c)			1				(11)
		Transaction-related costs, net			1				2
		COVID-19 charges (d)			(9)				18
Income before income taxes					$	1,778			$	236

__________

(a)Includes unallocated corporate overhead which is not attributable to a particular segment.

(b)For the six months ended June 30, 2022, includes operating expenses in our Consolidated Condensed Statements of Operations related to cloud computing costs of $4 million. For the six months ended June 30, 2021, includes operating expenses and selling, general and administrative expenses related to cloud computing costs of $3 million and $2 million, respectively, in our Consolidated Condensed Statements of Comprehensive Income.

(c)Reported within operating expenses.

(d)The following table presents the unusual, direct and incremental costs due to the COVID-19 pandemic:

	2022		2021
Minimum annual guaranteed rent in excess of concession fees, net	$	(9)	$	16
Vehicles damaged in overflow parking lots, net of insurance proceeds	—		(4)
Other charges	—		6
Operating expenses	$	(9)	$	17
Selling, general and administrative expenses	$	—	$	1
COVID-19 charges, net	$	(9)	$	18

Since December 31, 2021, there have been no significant changes in segment assets exclusive of assets under vehicle programs. As of June 30, 2022 and December 31, 2021, Americas’ segment assets under vehicle programs were approximately $14.7 billion and $11.4 billion, respectively. The change in assets under vehicle programs is primarily due to the increase in the size of our vehicle rental fleet to meet the increase in rental demand.