PARSIPPANY, N.J. - Avis Budget (NASDAQ:CAR) Group, Inc. (NASDAQ: CAR) reported first quarter earnings that fell short of analyst expectations, with a reported EPS of -$3.21, which was $0.81 below the analyst estimate of -$2.40. However, the company's revenue for the quarter was $2.55 billion, surpassing the consensus estimate of $2.52 billion.
The company's stock responded positively to the news, climbing 2.77%, indicating investor optimism.
Avis Budget Group's performance reflects a mixed financial picture. The revenue increase is a clear sign of strong travel demand, which has continued from the previous year into the first quarter, leading to record volume in the Americas and improved pricing trends. This surge in demand has been instrumental in the company's revenue outperformance.
Despite the revenue beat, the company's earnings per share fell significantly short of expectations. The net loss for the quarter stood at $113 million, with an adjusted EBITDA of $12 million. Avis Budget Group's CEO, Joe Ferraro, attributed the quarter's results to strategic actions to align fleet size, including disposing of a record number of vehicles, which allowed the company to exit March with utilization in line with the prior year.
Ferraro expressed confidence in the company's position to capitalize on the peak spring and summer travel seasons, thanks to the steps taken in the first quarter. The company's liquidity position at the end of the quarter was approximately $0.7 billion, with an additional $3.8 billion of fleet funding capacity, and no meaningful corporate debt maturities until 2027.
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