Segment Information

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

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

Management evaluates the operating results of each of our 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 legal matters, net, which includes amounts recorded in excess of $5 million related to class action lawsuits and personal injury matters; non-operational charges related to shareholder activist activity, which include third party advisory, legal and other professional fees; COVID-19 charges, net; cloud computing costs; other (income) expense, net; and income taxes.

We believe Adjusted EBITDA is useful as a supplemental measure in evaluating the performance of our operating businesses and in comparing our results from period to period. We also believe that Adjusted EBITDA is useful to investors because it allows them to assess our results of operations and financial condition on the same basis that management uses internally. Our presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies.

			Three Months Ended June 30,
			2023				2022
			Revenues		Adjusted EBITDA		Revenues		Adjusted EBITDA
Americas			$	2,428	$	631	$	2,567	$	1,041
International			695		126		677		183
Corporate and Other (a)			—		(20)		—		(19)
	Total Company		$	3,123	$	737	$	3,244	$	1,205
Reconciliation of Adjusted EBITDA to income before income taxes:
					2023				2022
Adjusted EBITDA					$	737			$	1,205
Less:		Non-vehicle related depreciation and amortization			52				51
		Interest expense related to corporate debt, net			68				64
		Restructuring and other related charges			1				6
		Transaction-related costs, net			—				1
		Other (income) expense, net (b)			4				—
		Reported within operating expenses:
		Cloud computing costs			9				2
		COVID-19 charges			—				(2)
		Legal matters, net			5				—
Income before income taxes					$	598			$	1,083

__________

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

(b)Primarily consists of losses related to our equity investment in a former subsidiary, offset by fleet related and certain administrative services provided to the same former subsidiary.

			Six Months Ended June 30,
			2023				2022
			Revenues		Adjusted EBITDA		Revenues		Adjusted EBITDA
Americas			$	4,444	$	1,147	$	4,567	$	1,851
International			1,236		176		1,109		206
Corporate and Other (a)			—		(51)		—		(42)
	Total Company		$	5,680	$	1,272	$	5,676	$	2,015
Reconciliation of Adjusted EBITDA to income before income taxes:
					2023				2022
Adjusted EBITDA					$	1,272			$	2,015
Less:		Non-vehicle related depreciation and amortization			108				109
		Interest expense related to corporate debt, net			141				117
		Restructuring and other related charges			5				14
		Transaction-related costs, net			—				1
		Other (income) expense, net (b)			2				—
		Reported within operating expenses:
		Cloud computing costs			16				4
		COVID-19 charges			—				(9)
		Legal matters, net			5				1
Income before income taxes					$	995			$	1,778

__________

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

(b)Primarily consists of losses related to our equity investment in a former subsidiary, offset by fleet related and certain administrative services provided to the same former subsidiary.

Since December 31, 2022, there have been no significant changes in segment assets exclusive of assets under vehicle programs. As of June 30, 2023 and December 31, 2022, Americas’ segment assets under vehicle programs were approximately $18.3 billion and $14.3 billion, respectively. This increase in assets under vehicle programs is directly correlated to the increase in the size and cost of our vehicle rental fleet to meet demand.