Avis Budget Group did “see a pullback” in first-quarter commercial demand, executives said on a Thursday earnings call, as revenue declined about 5 percent year over year. Overall demand remained relatively stable, “mitigated by improved leisure demand,” said outgoing Avis Budget CEO Joe Ferraro.
After a significant write-off and loss in the fourth quarter of 2024, executives said the company focused during the first quarter on the fleet rotation strategy it announced last year—which contributed to that Q4 loss.
“During the first quarter, we were laser-focused on executing our fleet refresh, laying the foundation for lower fleet costs and improved operating expenses through newer lower mileage vehicles, while also enhancing the customer experience,” Ferraro said. “The number of risk vehicles we disposed of this quarter was a company record—not only first quarter, but a record for any quarter in company history.
The used car residual market “has performed well this quarter, partially due to the annual spring bounce, and both new and used vehicle inventories being down, but also due to early reactions following the announced automotive tariffs,” Ferraro said. Avis Budget already has accepted delivery of 70 percent of its model year 2025 vehicles, he added.
“We are still working through the positive impacts of tariffs on used car prices, against the negative impacts of an unclear travel demand environment in the back half of the year,” Avis Budget CFO Izzy Martins said. “The progress we have made in reducing fleet costs, improving utilization and growing leisure despite softer commercial demand gives us confidence as we move through the remainder of the year.”
Ferraro will step down as CEO on June 30, to be replaced by former ABG CFO Brian Choi.
Avis Budget Q1 Metrics
Avis Budget reported first-quarter revenue of $2.4 billion, down nearly 5 percent year over year. The company’s net loss for the quarter was $505 million, up from a loss of $114 million a year prior.
The Americas segment reported first-quarter revenue of $1.9 billion, down more than 4 percent year over year. Quarterly revenue per day for the segment declined 3 percent to $64.92, while vehicle utilization was up 4 percentage points to 69.6 percent.
International revenue was $523 million, compared with $558 million in Q1 2024. The segment’s revenue per day was down 3 percent to $52.23. Vehicle utilization was up 2.1 percentage points to 69 percent.
The average rental fleet for the Americas for the quarter was 470,125, down 5 percent year over year. The international fleet size also decreased by 5 percent to 161,250.
Avis Budget Q4 performance
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