second quarter 2026
Filed Aug 3, 2026Custom Truck One Source, Inc. Reports Second Quarter 2026 Results and Increases Full Year 2026 Revenue and Adjusted EBITDA Guidance
Record second-quarter revenue, higher gross profit and Adjusted EBITDA, a return to net income, record STEM external customer revenue and increased full-year revenue and Adjusted EBITDA guidance were reported alongside lower net leverage.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Rental revenueGAAP | $ 145,060 (in $000s) | – | 20.1% |
| Equipment salesGAAP | $ 383,559 (in $000s) | – | – |
| Parts sales and servicesGAAP | $ 34,827 (in $000s) | – | – |
| Total revenueGAAP | $ 563,446 (in $000s) | – | 10.2% |
| Gross ProfitGAAP | $ 123,974 (in $000s) | – | 20.9% |
| Adjusted Gross Profitnon-GAAP | $ 180,901 (in $000s) | – | 15.6% |
| Net Income (Loss)GAAP | $ 10,399 (in $000s) | – | – |
| Adjusted EBITDAnon-GAAP | $ 116,754 (in $000s) | – | 25.0% |
| Six-month total revenueGAAP | $ 1,025,068 (in $000s) | – | – |
| Six-month Gross ProfitGAAP | $ 227,037 (in $000s) | – | – |
| Six-month Adjusted Gross Profitnon-GAAP | $ 340,161 (in $000s) | – | – |
| Six-month Net Income (Loss)GAAP | $ 6,297 (in $000s) | – | – |
| Six-month Adjusted EBITDAnon-GAAP | $ 214,740 (in $000s) | – | – |
| Ending OECother | $ 1,679,255 (in $000s) | – | – |
| Average OEC on rentother | $ 1,365,689 (in $000s) | – | 13.1% |
| Fleet utilizationother | 81.6 % | – | 400 basis points |
| OEC on rent yieldother | 39.4 % | – | – |
| Sales order backlogother | $ 322,470 (in $000s) | – | – |
| Net leverage ratioother | 3.85x | – | – |
| SER Segment Adjusted EBITDAnon-GAAP | $ 117,199 (in $000s) | – | – |
| STEM Segment Adjusted EBITDAnon-GAAP | $ 37,217 (in $000s) | – | – |
| Eliminations Adjusted EBITDAnon-GAAP | $ (14,942) (in $000s) | – | – |
| Corporate and non-allocated selling, general and administrative expensesother | $ (22,720) (in $000s) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Specialty Equipment Rentals (SER)Sustained strength in core T&D markets was identified as the primary driver of performance within SER. The rental fleet achieved average utilization of 81.6%. | $ 218,819 (in $000s), Total revenue from external customers | – | – |
| Specialty Truck Equipment and Manufacturing (STEM)STEM had a record quarter, with external customer revenue of $345 million and equipment sales of $332 million. | $ 344,627 (in $000s), Total revenue from external customers | – | – |
full year 2026 outlook
- Revenue$2.1 billion - $2.2 billion
- NoteAdjusted EBITDA: $437.5 million - $455 million
What drove it
- Record second-quarter revenue of $563.4 million was supported by rental revenue, equipment sales, and parts sales and services.
- Sustained strength in transmission and distribution end markets was cited as the primary performance driver within SER and for the Company as a whole.
- Rental fleet utilization was 81.6 %, and average OEC on rent was $ 1,365,689 (in $000s).
- STEM reported record external customer revenue of $345 million and equipment sales of $332 million.
- Management cited data center investment, electrification, utility grid upgrades and infrastructure spending as secular tailwinds.
Concerns
- Sales order backlog was $ 322,470 (in $000s) at June 30, 2026, compared with $ 334,805 (in $000s) at June 30, 2025 and $ 411,311 (in $000s) at March 31, 2026.
- The filing states that sales order backlog should not be considered an accurate measure of future net sales.
- CTOS stated it cannot provide a quantitative reconciliation of forward-looking Adjusted EBITDA to the most directly comparable GAAP measure because of variability and difficulty predicting certain items, including customer buyout requests on rentals with rental purchase options and income tax expense.
What to watch
- Progress toward full-year 2026 revenue guidance of $2.1 billion - $2.2 billion.
- Progress toward full-year 2026 Adjusted EBITDA guidance of $437.5 million - $455 million.
- SER rental fleet utilization, OEC on rent yield, average OEC on rent and ending OEC.
- Sales order backlog and performance of STEM equipment sales.
- Net leverage reduction, working capital management and free cash flow generation.
Balance sheet and cash flow
- Reduced net leverage ratio to 3.85x at quarter-end, compared to 4.02x at the end of the first quarter and 4.31x at year-end 2025.
- Ending OEC was $ 1,679,255 (in $000s) as of June 30, 2026.
- Sales order backlog was $ 322,470 (in $000s) as of June 30, 2026.
Analysis
CTOS reported record second-quarter revenue of $ 563,446 (in $000s), up 10.2% from $ 511,483 (in $000s) in the second quarter of 2025. Rental revenue was $ 145,060 (in $000s), equipment sales were $ 383,559 (in $000s), and parts sales and services were $ 34,827 (in $000s). Gross Profit was $ 123,974 (in $000s), while Adjusted Gross Profit was $ 180,901 (in $000s). The company returned to GAAP net income of $ 10,399 (in $000s), compared with a Net Income (Loss) of $ (28,380) (in $000s) a year earlier.
Adjusted EBITDA reached $ 116,754 (in $000s), an increase of 25.0% from $ 93,428 (in $000s). SER Segment Adjusted EBITDA was $ 117,199 (in $000s), while STEM Segment Adjusted EBITDA was $ 37,217 (in $000s). The segment structure changed beginning January 1, 2026, with prior-period amounts recast into Specialty Equipment Rentals and Specialty Truck Equipment and Manufacturing. Management said the revised reporting reflects how the business is managed, capital is allocated and segment performance is evaluated.
Rental conditions were a central support for the quarter. Average OEC on rent was $ 1,365,689 (in $000s), fleet utilization was 81.6 %, and OEC on rent yield was 39.4 %. Ending OEC was $ 1,679,255 (in $000s), which management described as the highest quarter-end level in company history. Management identified sustained strength in transmission and distribution markets as the principal driver for SER, while STEM reported record external customer revenue of $345 million and equipment sales of $332 million.
Capital structure progress continued, with net leverage reduced to 3.85x at quarter-end from 4.02x at the end of the first quarter and 4.31x at year-end 2025. Management increased its 2026 full-year revenue guidance range to $2.1 billion - $2.2 billion from $2.005 billion - $2.12 billion and its Adjusted EBITDA range to $437.5 million - $455 million from $415 million - $440 million. Sales order backlog was $ 322,470 (in $000s) at June 30, 2026, and the company cautioned that backlog should not be considered an accurate measure of future net sales.
Management, verbatim
In the second quarter, we delivered record quarterly revenue and substantial year-over-year growth in revenue and Adjusted EBITDA of 10% and 25%, respectively. Sustained strength in our core T&D markets remains the primary driver of performance within our SER segment and for the Company as a whole. Our rental fleet achieved average utilization of 81.6% for the quarter, up 400 basis points from a year ago, and we ended the quarter with total OEC of $1.68 billion, the highest quarter-end level in our history, positioning us for continued SER growth through the balance of 2026.
Ryan McMonagle, Chief Executive Officer of CTOS
STEM also had a record quarter, with external customer revenue of $345 million and equipment sales of $332 million. The strength across both segments allowed us to continue making substantial progress in reducing our net leverage. We are optimistic about the second half of 2026, as CTOS remains well-positioned to benefit from secular tailwinds in data center investment, electrification, utility grid upgrades and infrastructure spending. We remain focused on Adjusted EBITDA growth, working capital management, free cash flow generation and continued deleveraging.
Ryan McMonagle, Chief Executive Officer of CTOS
Not in the filing
stated, not guessed- GAAP diluted EPS and non-GAAP diluted EPS were not provided in the supplied filing text.
- Gross margin, GAAP operating income or loss, and non-GAAP operating margin were not provided in the supplied filing text.
- Operating cash flow, free cash flow, capital expenditures, cash balance, total debt and net debt were not provided in the supplied filing text.
- Share repurchases, dividends and other capital-return amounts were not provided in the supplied filing text.
- Forward guidance for gross margin, operating expenses and tax rate was not provided in the supplied filing text.
- A separate previous-release outlook section was not provided, so no actual-versus-prior-guidance comparison is included.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.