CAR 10-K & 10-Q changes, risk factors and insider trading

While we source our fleet purchases from a wide range of auto manufacturers, we are exposed to risk to the extent that any auto manufacturer significantly curtails production. Such production may be curtailed as a result of a wide range of factors, including impacts of a pandemic and supply chain impacts, including as a result of tariffs and shortages of parts,parts such as semiconductor parts utilizing rare earth minerals, which have impacted certain manufacturers in the past.

We are also exposed to risk to the extent that any auto manufacturer increases the cost of vehicles, including as a result of inflation, trade disputes, tariffs, labor shortages or disruptions, or supply chain disruptions, or declines to sell vehicles to us on terms or at prices consistent with past practice. Should any of these risks occur, we may be unable to obtain a sufficient number of vehicles to operate our business without significantly increasing our fleet costs or the mileage of the vehicles in our fleet, or reducing our volumes.

Our vehicles have in the past and may in the future be subject to safety recalls by their manufacturers,manufacturers. whichSuch couldrecalls have an adverse impact on our business when we remove recalled vehicles from our rentable fleet. We can neither control nor predict the number of vehicles that will be subject to manufacturer recalls in the future. Recalls often require us to retrieve vehicles from customers and/or hold vehicles from rental or sale until we can arrange for the repairs described in the recalls to be completed. As such, recalls canRecalls increase our costs, negatively impact our revenues and/or reduce our fleet utilization. If a large number of vehicles were to be the subject of one or more recalls, which has occurred in the past, or if needed replacement parts wereare not inreadily adequateavailable supply,to us, we may be unable to utilize recalled vehicles for a significant period of time. We may also be subject to material liability claims or regulatory action related to vehicles subject to a safety recall. Depending on the nature and severity of the recall, it could create customer service problems, reduce the residual value of the vehicles involved, harm our reputation and/or have an adverse impact on our financial condition or results of operations.

Any significant airline capacity reductions, airfare or related fee increases, reduced flight schedules, or any events that disrupt or reduce business or leisure air travel or weaken travel demand and tourism, globally or in the key areas in which we operate, such as work stoppages, government shutdowns, military conflicts, terrorist incidents, natural disasters, disease epidemics, or the response of governments to any such events, could have an adverse impact on our results of operations. For example, events of a global nature such as the COVID-19 pandemic have had, and may in the future have, material impacts on the Company.

Ongoing military conflicts, including in the Middle East and Eastern Europe, are causing uncertainty that may have an adverse impact on our business, financial condition and results of operations.

The world economy and markets are experiencing volatility and disruption from ongoing military conflicts, including in the Middle East and Eastern Europe, the length and impact of which are highly unpredictable. These conflicts have led to, and could in the future lead to, significant volatility in our costs, including fuel and fleet costs, including as a result of sanctions or any embargoes on oil sales imposed on or by the Russian government; impacts to fleet availability; and impacts on demand for travel as a result of weakness in economic conditions, increased inflation or increases in the cost of fuel as well as other factors. In addition, as a result of the conflict in Eastern Europe, governmental and non-governmental entities have issued alerts noting the potential for increased cyber-attacks. Such risks and disruptions could adversely impact our business, results of operations and financial condition.

Vehicle electrification refers to a range of technologies that use electricity to propel a vehicle and includes hybrid, plug-in, extended-range and battery electric vehicles, as well as autonomous vehicles. We believe that the vehicle industry will continue to experience significant change in the coming years, in particular as it relates to vehicle electrification. Worldwide demand for electric and hybrid vehicles continues to increase, and manufacturers continue to invest more time and cost into producing these types of vehicles in an effort to reduce fuel consumption and greenhouse gas emissions, as mandated by various governmental standards and regulations. If we are not adequately prepared to meet consumer demand for electric, hybrid and autonomous vehicles as such demand develops, including if we are unable to attain an optimal and consistently reliable charging infrastructure and systems, which will require substantial capital investment, or if consumer demand for electric, hybrid and autonomous vehicles fails to meet our expectations, including due to slower or inadequate investments in charging infrastructure by third parties, changes in governmental regulations, tax credits, rebates and subsidies, or changes in consumer sentiment, our financial condition or results of operations could be adversely impacted.

We carry a significant amount of goodwill and long-lived assets on our Consolidated Balance Sheets. Goodwill is the excess of purchase price over the fair value of the net assets of acquired businesses. We assess goodwill and long-lived assets for impairment if circumstances suggest an impairment may have occurred, and annually for goodwill and indefinite-lived intangible assets. We have determined in the past and may again determine in the future that a significant impairment has occurred in the value of our goodwill and long-lived assets. Additionally, we have a significant amount of goodwill and long-lived assets that could also be subject to impairment. If we determine that an impairment has occurred in the value of our goodwill or long-lived assets, we could be required to write off a portion of our goodwill or long-lived assets, which could adversely affect our consolidated financial condition or our reported results of operations. For example, to decrease our fleet age for competitive reasons, in the fourth quarter of 2024 we accelerated our plans with respect to certain fleet rotations and shortened the useful life associated with such vehicles, which resulted in an impairment charge. In addition, during the fourth quarter of 2025, in conjunction with the Interpace Ventures transaction, we shortened the useful life associated with certain EV rental car vehicles, which resulted in an impairment charge. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Results of Operations” and Note 2 – Summary of Significant Accounting Policies – Impairment of Long-Lived Assets to our Consolidated Financial Statements.

RISKS RELATED TO LEGAL, REGULATORY AND ENVIRONMENTAL,CORPORATE SOCIAL, AND GOVERNANCE (“ESG”)RESPONSIBILITY RELATED MATTERS

Our global operations expose us to various claims, lawsuits and other legal proceedings that arise in and outside of the ordinary course of our business in the countries in which we operate. We are or may be subject to complaints and/or litigation involving our customers, licensees, employees, independent operators and others with whom we conduct business and other third parties, including claims for bodily injury, death and property damage related to use of our vehicles or our locations, or claims based on allegations of discrimination, misclassification as exempt, wage and hour pay disputes or allegations related to our business practices, claims based on allegations of omission or misstatements in our policies and/or public filings, and various other claims. We could be subject to substantial costs and/or adverse outcomes from such claims, which could have a material adverse effect on our financial condition, cash flows or results of operations.

Governments are likely tomay continue to pursue measures related to climate change and greenhouse gas emissions, including vehicle travel restrictions. Should rules establishing limitations on greenhouse gas or other emissions or rules imposing fees on entities deemed to be responsible for greenhouse gas emissions, or rules establishing bans on diesel or fuel vehicles from entering certain locations become effective in the countries in which we operate, demand for our services could be affected, our fleet and/or other costs could increase, and our business could be adversely impacted.

We face risks related to ESGCorporate Responsibility matters.

The growing focus on climateClimate change, heightened societal expectations for companies to address environmental and social matters, and the proliferationchanging ofpublic ESGinterest relatedand regulations and laws relating to Corporate Responsibility matters and disclosures and otherwise, both domestically (including in California) and globally (especially in the European continent) pose risks to our business. These developments could lead to increased operational and compliance costs, shifts in consumer and customer preferences toward substitute products, reduced demand for our offerings, and potential impacts on profitability. Additionally, these factors, as well as our action or inaction with respect to ESGCorporate Responsibility matters, may result in heightened regulatory or public scrutiny, increased litigation, reputational damage, and adverse effects on our revenue, stock price and/or access to capital markets.

We have developed certain initiatives, goals and practices relating to ESGCorporate Responsibility matters. We may not be successful in implementing these initiatives, goals and practices, including due to factors beyond our control, and even if successful, they may not achieve our desired or expected outcomes. If our ESGCorporate Responsibility initiatives, goals, and practices do not meet our expectations, those of our investors or other stakeholders, or requirements of local rules and regulations, each of which continue to evolve, we may incur additional costs, and our brand, reputation and results of operations and financial condition may be adversely impacted.

We face risks associated with changes in tax laws.laws, including the expiration of tax credits.

The Tax Cuts and Jobs Act of 2017 (the “Tax Act”) eliminated the use of like-kind exchange for personal property and allowed for full expensing of qualified property purchases through 2022. From 2004 until its elimination, we utilized like-kind exchange to replace vehicles in a manner that allowed for a material deferral of United States (U.S.) federal and state income taxes. The effect of the repeal of the like-kind exchange treatment for vehicle sales has been largely offset through 2022 by the availability of full expensing for certain business assets (including our vehicles) in the year placed in service. During 2023, the full expensing provision started to phase-out ratably by 20% each year; betweenhowever, 2023in andJuly 2027.2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted, making permanent key provisions of the Tax Act, including full expensing for qualified property, thereby eliminating the scheduled phase-out. Certain U.S. states have modified their tax statutes as a result of the Tax Act, and such state legislation does not allow the use of full expensing benefits for state tax purposes, which negatively impacts our tax liability in such states. Other U.S. states continue to modify their tax statutes related to full expensing. Therefore, we cannot offer assurance that the benefits from the expected tax deductions will continue.

The Inflation Reduction Act of 2022 (the “IRA”) includesincluded a 15% corporate alternative minimum tax on certain large corporations and a 1% excise tax on certain corporate stock repurchases. The impact on the Company of these provisions, which became effective on January 1, 2023, will depend on several factors, including recently released and forthcoming interpretive regulatory guidance.guidance, as well as recent legislative changes, such as those implemented under the OBBBA. The Company continues to review and assess the provisions of the IRA, and its potential impact on our financial condition, results of operations, liquidity, and cash flows.

Our Board of Directors previously authorized the repurchase of up to $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded most recently in February 2023 (the “Share Repurchase Program”). As of December 31, 2024,2025, approximately $757 million remains available under the Share Repurchase Program. If we purchase additional shares of our common stock under the Share Repurchase Program, the percentage of our outstanding common stock owned by SRS Investment Management, LLC and its affiliates (“SRS”) may increase, even without further action by SRS. Under the terms of the Fourth Amended and Restated Cooperation Agreement between the Company and SRS,SRS (as amended from time to time), SRS has committed, with respect to shares of common stock SRS holds in excess of 35%45% of the Company’s outstanding common stock, to exercise its voting rights in the same proportion in which other shares of common stock are voted. Notwithstanding this commitment, the ownership by SRS of more than 50% of the Company’s outstanding common stock could trigger, or increase the likelihood that we trigger, certain change in control provisions in the indentures governing our senior notes. The Company must make a 101% change of control offer for the senior notes if, within 60 days following a change of control, the ratings on the notes are downgraded by one or more gradations or withdrawn and the applicable rating agency announces that such downgrade or withdrawal is attributable to the change of control.

We rely heavily on the satisfactory performance and availability of our information systems, including our reservation systems, websites and network infrastructure to attract and retain customers, accept reservations, process rental and sales transactions, manage our fleet of vehicles, account for our activities and otherwise conduct our business. We rely on third-party communications service and system providers for technology services. We have been subjected to, and from time to time in the future may be subject to, a failure or interruption that results in the unavailability of certain of our information systems. Such a failure or interruption, or a major disruption, could cause a loss of reservations, interfere with our fleet management, slow rental and sales processes, create negative publicity that damages our reputation or otherwise adversely impacts our ability to manage our business effectively. We have in the past and may in the future experience system interruptions or disruptions for a variety of reasons, including from network failures, power outages, cyber-attacks, human error or misuse, software errors, an unusually high volume of visitors attempting to access our systems, or other events such as fire, explosions, earthquakes, storms, floods, epidemics, strikes, acts of war, civil unrest or terrorist acts. Because we are dependent in part on independent third parties for the implementation and maintenance of certain aspects of our systems and because some of the causes of system interruptions may be outside of our control, we may not be able to remedy such interruptions in a timely manner, or at all. Our systems’ business continuity plans and insurance programs seek to mitigate such risks but they cannot fully eliminate the risks.

In addition, anyone who is able to circumvent our security measures or gain unauthorized access to our systems or information or those of our third-party service providers despite such security measures, have in the past misappropriated, and could misappropriatein the future misappropriate, proprietary information or cause interruptions in our operations. Cybersecurity incidents that we have experienced in the past and may experience in the future may be caused by malicious third parties using sophisticated, targeted methods to circumvent firewalls, encryption, and other security defenses, and could include hacking, viruses, malicious software, ransomware, phishing attacks, denial of service attacks and other attempts to capture, disrupt or gain unauthorized access to data, all of which are rapidly evolving. Such incidents could lead to disruptions in our reservation system or other data systems, unauthorized release of confidential or otherwise protected information or corruption of data. The techniques used by third parties change frequently and may be difficult to detect for long periods of time. Any successful efforts by individuals to infiltrate, break into, disrupt, damage or otherwise steal from the Company’s, its licensees’ or its third-party service providers’ security or information systems could damage our reputation and expose us to increased cybersecurity protection costs, litigation or other liability that could adversely impact our financial condition or results of operations. ACybersecurity cybersecurity breachbreaches resulting in the unauthorized use or disclosure of certain personal information could put individuals atcreate risk of identity theft andtheft, financial or other harm and result in costs to the Company in investigation, remediation, legal defense and in liability to parties who are financially harmed. Failure to appropriately address these issues could also give rise to potentially material legal risks and liabilities.

In 2024,2025, we saw sustained volume, decreased revenue per day,day and increasedlower per-unit fleet andcosts, interestexcluding costs.other fleet charges related to the disposal of certain fleet in our Americas reportable segment. This resulted in revenues of approximately $11.8$11.7 billion, a net loss of $1.8$995 billionmillion and Adjusted EBITDA of $628$748 million for the year ended December 31, 2024.2025. During the fourth quarter of 2024,2025, in conjunction with the Interpace Ventures transaction, we changedreviewed our fleet strategystrategy, specific to accelerate certain fleetUnited rotationsStates inEV orderrental tocar decrease the age of our fleet for competitive reasons,vehicles, and accordingly,as wea result shortened the useful life associated with such vehicles. Our net loss reflects $2.5$518 billionmillion in long-lived asset impairment and other related charges, approximately $2.3 billion of which was recorded to reduce the carrying value of ourcertain United States EV rental fleetcar vehicles to its fair value in connection with this change. See Note 2 – Summary of Significant Accounting Policies – Impairment of Long-livedLong-Lived Assets to our Consolidated Financial Statements.

We continue to be susceptible to a number of industry-specific and global macroeconomic factors that may cause our actual results of operations to differ from our historical results of operations or current expectations. The factors and trends that we currently believe are or will be most impactful to our results of operations and financial condition include the following: interest rates, inflationary impact on items such as commodity prices and wages, cost of new vehicles, used car values, increases in the number of personal injury claims and cost per incident, government shutdowns, manufacturer recalls, and an economic downturn that may impact travel demand, all of which may be exacerbated by ongoing military conflicts, including in the Middle East and Eastern Europe. Additionally, uncertainty remains with respect to tariffs and tax regulations, and this uncertainty has had and may continue to have impacts on globalour stock markets and foreign exchange rates.operations. We continue to monitor the potential favorable or unfavorable impacts of these and other factors on our business, operations, financial condition, and future results of operations. Our strategy continues to primarily focus on customer experience and costs to strengthen our Company, maximize profitability, and deliver stakeholder value.

We measure performance principally using the following key metrics: (i) rental days, which represent the total number of days (or portion thereof) a vehicle was rented, (ii) revenue per day, which represents revenues divided by rental days, (iii) vehicle utilization, which represents rental days divided by available rental days, with available rental days being defined as average rental fleet times the number of days in the period, and (iv) per-unit fleet costs, which represent vehicle depreciation, lease charges and gain or loss on vehicle sales, divided by average rental fleet. Our rental days, revenue per day and vehicle utilization metrics are all calculated based on the actual rental of the vehicle during a 24-hour period. We believe that this methodology provides management with the most relevant metrics in order to effectively manage the performance of the business. Our calculation may not be comparable to the calculation of similarly titledsimilarly-titled metrics by other companies. We present currency exchange rate effects to provide a method of assessing how our business performed excluding the effects of foreign currency rate fluctuations. Currency exchange rate effects are calculated by translating the current-periodcurrent period results at the prior-periodprior period average exchange rate plus any related gains and losses on currency hedges.

We assess performance and allocate resources based upon the separate financial information of our operating segments. We aggregate certain of our operating segments into our reportable segments. In identifying our reportable segments, we also consider the management structure of the organization, the nature of services provided by our operating segments, the geographical areas and economic characteristics in which the segments operate, and other relevant factors. 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; long-lived asset impairment and other related charges; other fleet charges; restructuring and other related charges; early extinguishment of debt costs; non-vehicle related interest; transaction-related costs, net; legal matters, net, which primarily includes amounts recorded in excess of $5 million, related primarily to unprecedented self-insurance reserves for allocated loss adjustment expense, class action lawsuits and personal injury matters; non-operational charges related to shareholder activist activity, which includes third-party advisory, legal and other professional fees; COVID-19 charges, net; cloud computing costs; other (income) expense, net; severe weather-related damages in excess of $5 million, net of insurance proceeds; and income taxes. In the first quarter of 2025, we revised our definition of Adjusted EBITDA to exclude other fleet charges. We did not revise prior years' Adjusted EBITDA amounts because there were no other charges similar in nature to these.

We have revised our definition of Adjusted EBITDA to exclude severe weather-related damages in excess of $5 million, net of insurance proceeds. We did not revise prior years' Adjusted EBITDA amounts because there were no other charges similar in nature to these. 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. Adjusted EBITDA is a non-GAAP measure and should not be considered in isolation or as a substitute for net income or other income statement data prepared in accordance with U.S. GAAP. Our presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies.

Revenues decreased $219$137 million or 2%1% for the year ended December 31, 20242025, compared to the similar period in 2023,2024, primarily due to a 3%1% decrease in revenue per day, excluding exchange rate effects and sustained volume, partially offset by a $9$71 million negativepositive impact from currency exchange rate movements, partially offset by a 1% increase in volume.movements. Total expenses increaseddecreased 43%13% for the year ended December 31, 2024,2025, compared to the similar period in 2023,2024, primarily due to the long-lived asset impairment and other related charges,charges higherrecorded per-unitin fleet costs and higher interest costs.2024. See Note 2 – Summary of Significant Accounting Policies – Impairment of Long LivedLong-Lived Assets to our Consolidated Financial Statements. Our effective tax rates for the years ended December 31, 20242025 and 20232024 were a provision of 7.1% and a benefit of 30.8% and a provision of 14.6%,30.8%, respectively. As a result of these items, our net incomeloss attributable to Avis Budget Group, Inc. decreased by $3.5$932 billionmillion compared to the similar period in 2023.2024. For the years ended December 31, 20242025 and 2023,2024, we reported diluted earnings (loss) per share of $(51.23)$25.25 and $42.08,$51.23, respectively.

Operating expenses increaseddecreased to 51.0%50.3% of revenues for the year ended December 31, 20242025, compared to 47.3%51.0% during the similar period in 2023,2024, primarily due to ana increasesettlement distribution relating to our participation in volume.the In re Automotive Parts Antitrust Litigation and decreased fleet operating costs, partially offset by increased facilities costs. See Note 15 – Commitments and Contingencies to our Consolidated Financial Statements. Vehicle depreciation and lease charges increased to 25.2%25.9% of revenues for the year ended December 31, 20242025, compared to 14.5%25.2% during the similar period in 2023,2024, primarily drivendue byto higher per-unitother fleet costs;charges adjustedrelated depreciationto onthe ourdisposal rentalof certain fleet following a change in our fleetAmericas strategy,reportable wherebysegment, wepartially haveoffset acceleratedby certainan fleet rotations and shortened the useful life associated with such vehicles; and a decreaseincrease in the gain on sale of vehicles. Selling, general and administrative costs wereincreased 11.5%to 12.4% of revenues for the year ended December 31, 20242025, compared to 11.7%11.5% during the similar period in 2023.2024, primarily due to increased commissions, marketing and other general and administrative costs. Vehicle interest costs increasedwere to 8.0%7.9% of revenues for the year ended December 31, 2024,2025, compared to 6.1%8.0% during the similar period in 2023, primarily due to rising interest rates.2024.

Following is a more detailed discussion of the results of each of our reportable segments,segments and corporate and other, andtogether with a reconciliation of net incomeloss to Adjusted EBITDA:

(b)IncludesFor the year ended December 31, 2025, includes an impairment charge of approximately $518 million within our Americas reportable segment, related to the acceleration of the rotation of certain United States EV rental car vehicles in conjunction with the Interpace Ventures transaction. For the year ended December 31, 2024, includes an impairment charge of approximately $2.3 billion related to the acceleration of the rotation of our fleet and a charge of $180 million related to the write-down of the carrying value of certain vehicles held for sale within our Americas reportable segment. See Note 2 – Summary of Significant Accounting Policies – Impairment of Long-Lived Assets to our Consolidated Financial Statements.

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

(de)IncludesConsists of $3 million and $4 million reported within selling, general and administrative expenses for the yearyears ended December 31, 20242025 and 2024, respectively, and $102 million of income and $60 million and $5 million reported within operating expenses infor the years ended December 31, 20242025 and 2023,2024, respectively. The $60 million recorded within operating expenses for the year ended December 31, 2024 includes $46 million relating to our self-insurance reserves for allocated loss adjustment expense.

(ef)Reported within operating expenses.

Operating expenses increaseddecreased to 51.2%50.5% of revenues for the year ended December 31, 20242025, compared to 47.4%51.2% during the similar period in 2023,2024, primarily due to ana increasesettlement distribution relating to our participation in volume.the In re Automotive Parts Antitrust Litigation and decreased fleet operating costs, partially offset by increased facilities costs. See Note 15 – Commitments and Contingencies to our Consolidated Financial Statements. Vehicle depreciation and lease charges increased to 25.3%27.1% of revenues for the year ended December 31, 20242025, compared to 13.0%25.3% during the similar period in 2023,2024, primarily drivendue byto higher per-unitother fleet costs;charges adjustedrelated depreciationto onthe ourdisposal rentalof certain fleet following a change in our fleetAmericas strategy,reportable wherebysegment, wepartially haveoffset acceleratedby certainan fleet rotations and shortened the useful life associated with such vehicles; and a decreaseincrease in the gain on sale of vehicles. Selling, general and administrative costs wereincreased 9.5%to 10.6% of revenues for the year ended December 31, 20242025, compared to 9.6%9.5% during the similar period in 2023.2024, primarily due to increased commissions, marketing and other general and administrative costs. Vehicle interest costs increasedwere to 8.6%8.8% of revenues for the year ended December 31, 20242025, compared to 6.6%8.6% during the similar period in 2023, primarily due to rising interest rates.2024.

Adjusted EBITDA decreased for the year ended December 31, 20242025 comparedis comparable to the similar period in 2023, primarily due to higher per-unit fleet costs, interest costs, and a $2 million negative impact from currency exchange rate movements.2024.

Revenues increased for the year ended December 31, 20242025, compared to the similar period in 2023,2024, primarily due to a 4%3% increase in volume, partially offset by a 3% decrease in revenue per day, excluding exchange rate effects and a $1$77 million negativepositive impact from currency exchange rate movements.movements, partially offset by a 3% decrease in volume.

Operating expenses increaseddecreased to 48.3%47.5% of revenues for the year ended December 31, 20242025, compared to 45.6%48.3% during the similar period in 2023,2024, primarily due to an increase in revenue per day, excluding exchange rate effects and a positive impact from currency exchange rate movements, partially offset by a decrease in volume. Vehicle depreciation and lease charges increaseddecreased to 25.2%21.8% of revenues for the year ended December 31, 20242025, compared to 19.7%25.2% during the similar period in 2023,2024, primarily due to increaseddecreased per-unit fleet costs, increasedexcluding depreciationexchange rates,rate effects, and adecreased decreasefleet in the gain on sale of vehicles.levels. Selling, general and administrative costs were 15.3%15.4% of revenues for the year ended December 31, 20242025, compared to 15.4%15.3% during the similar period in 2023.2024. Vehicle interest costs increaseddecreased to 5.7%4.9% of revenues for the year ended December 31, 20242025, compared to 4.4%5.7% during the similar period in 2023,2024, primarily due to risingdecreased fleet levels and interest rates.

Adjusted EBITDA decreasedincreased for the year ended December 31, 20242025, compared to the similar period in 2023,2024, primarily due to higheran increase in revenue, lower per-unit fleet and interest costs,costs and aan $13approximately $11 million negativepositive impact from currency exchange rate movements.

Adjusted EBITDA increaseddecreased for the year ended December 31, 20242025, compared to the similar period in 2023,2024, primarily due to decreasedincreased selling, general and administrative expenses, which are not attributable to a particular segment.

The increase in total assets exclusive of assets under vehicle programs compared to 20232024 is principallyprimarily relateddue to our deferred income taxes which reflect the enactment of the One Big Beautiful Bill Act and the increase in operating lease right-of-use assets. See Note 3 – Leases and Note 9 – Income Taxes to our Consolidated Financial Statements.

The increase in total liabilities exclusive of liabilities under vehicle programs compared to 20232024 is principallyprimarily relateddue to the increase in operating lease liabilities and corporate indebtedness from the issuance of seniorSenior notes.Notes due June 2032. See “Liquidity and Capital Resources,” Note 3 – Leases and Note 13 – Long-term Corporate Debt and Borrowing Arrangements to our Consolidated Financial Statements.

The decreasesincreases in both assets and liabilities under vehicle programs are principallyprimarily relateddue to the decreaseincrease in the size and valuecost of our vehicle rental fleet.

The decrease in total stockholders’ equity compared to 20232024 is principallyprimarily relateddue to our comprehensivenet loss.

In February 2025, we borrowed $500 million under a floating rate term loan due December 2025, which is part of our senior revolving credit facilities. The proceeds were primarily used to pay down fleet indebtedness. In June 2025, we fully repaid our outstanding borrowings under the floating rate term loan due 2025.

During 2024,2025, our Avis Budget Rental Car Funding (AESOP) LLC subsidiary issued approximately $2.8$1,708 billionmillion of asset-backed notes with expected final payment dates ranging from FebruaryAugust 20262027 to DecemberFebruary 2029,2031 and a weighted average interest rate of 6.04%.5.33%. Avis Budget Rental Car Funding (AESOP) LLC has also amended and extended its asset-backed variable-fundingvariable funding financing facilities, most recently in December 2024.2025. The proceeds from these borrowings were used to fund the repayment of maturing vehicle-backed debt and the acquisition of rental cars in the United States.

Our Board of Directors has authorized the repurchase of up to approximately $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023 (the “Stock Repurchase Program”). Our stock repurchases may occur through open market purchases, privately negotiated transactions or trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements, restricted payment capacity under our debt instruments and other factors. The Stock Repurchase Program may be suspended, modified or discontinued at any time without prior notice. The Stock Repurchase Program has no set expiration or termination date. For the year ended December 31, 2024,2025, we repurchaseddid approximatelynot 0.6 millionrepurchase shares of common stock at a cost of approximately $45 million (excluding excise taxes due under the Inflation Reduction Act of 2022) under the Stock Repurchase Program. As of December 31, 2024,2025, approximately $757 million of authorization remained available to repurchase common stock under the Stock Repurchase Program.

The decrease in cashCash provided by operating activities during 20242025 comparedis consistent with 2023 is primarily due to the decrease in our net income.2024.

The decreaseincrease in cash used in investing activities during 20242025 compared with 20232024 is primarily due to the decreaseincrease in our net investment in vehicles.vehicles, partially offset by the increase in proceeds received on vehicle sales.

The increase in cash usedprovided inby financing activities during 20242025 compared with 20232024 is primarily due to the increase in our net paymentsborrowings under vehicle programs, partially offset by the decrease in our common stock repurchases and the increase in our net corporate borrowings.programs.

AtAs of December 31, 2024,2025, we had approximately $22.9$25.3 billion of indebtednessindebtedness, (including corporate indebtedness of approximately $5.4$6.1 billion and debt under vehicle programs of approximately $17.5$19.2 billion).billion. For information regarding our debt and borrowing arrangements, see Note 1 – Basis of Presentation, Note 13 – Long-term Corporate Debt and Borrowing Arrangements, and Note 14 – Debt Under Vehicle Programs and Borrowing Arrangements to our Consolidated Financial Statements.

As of December 31, 2024,2025, we had $534$519 million of available cash and cash equivalents and access to $503$299 million of available borrowing capacity under our revolving credit facility, providing us with access to approximately $1.0$818 billionmillion of total liquidity. Including our uncommitted facilities, we had total liquidity of approximately $1.1 billion.

The results of the majority of our recurring operations are recorded in our financial statements using accounting policies that are not particularly subjective, nor complex. However, in presenting our financial statements in conformity with generally accepted accounting principles (“GAAP”), we are required to make estimates and assumptions that affect the amounts reported therein. Several of the estimates and assumptions we are required to make relate to matters that are inherently uncertain as they relate to future events and/or events that are outside of our control. If there is a significant unfavorable change to current conditions, it could result in a material adverse impact to our consolidated results of operations, financial position and liquidity. We believe that the estimates and assumptions we used when preparing our financial statements were the most appropriate at that time. Presented below are those accounting policies that we believe require subjective and complex judgments that could potentially affect reported results.

Our goodwill and other indefinite-lived intangible assets are allocated among our reporting units. During 2025, there was no impairment of goodwill and other indefinite-lived intangible assets. During 2024, we recorded $28 million in long-lived asset impairment and other related charges for impairment of one of our unamortized indefinite-lived intangible assets. During 2024, there was no impairment of goodwill. During 2023, there was no impairment of goodwill and other indefinite-lived intangible assets.

Vehicles. We present vehicles at cost, net of accumulated depreciation, on the Consolidated Balance Sheets. We record the initial cost of the vehicle, net of incentives and allowances from manufacturers. We acquire our rental vehicles either through repurchase and guaranteed depreciation programs with certain automobile manufacturers or outside of such programs. For rental vehicles purchased under such programs, we depreciate the vehicles such that the net book value on the date of sale or return to the manufacturers is intended to equal the contractual guaranteed residual values. For risk vehicles acquired outside of manufacturer repurchase and guaranteed depreciation programs, we depreciate based on the vehicles’ estimated residual market values at their expected dates of disposition. The estimation of residual values requires us to make assumptions regarding the age and mileage of the vehicle at the time of disposal, as well as expected used vehicle market conditions. We regularly evaluate estimated residual values and adjustsadjust depreciation rates as appropriate. Differences between actual residual values and those estimated result in a gain or loss on disposal and are recorded as part of vehicle depreciation and lease charges, net, at the time of sale.

During 2025, we recorded $518 million in long-lived asset impairment and other related charges related to the acceleration of the rotation of certain United States EV rental car vehicles and shortened useful life associated with such vehicles, in conjunction with the Interpace Ventures transaction. During 2024, we recorded $2.5 billion in long-lived asset impairment and other related charges related to vehicles, including an approximately $2.3 billion impairment charge related to the acceleration of rotation of our fleet and shortened useful life associated with such vehicles. During 2023, there was no long-lived asset impairment and other related charges. See Note 2 – Summary of Significant Accounting Policies and Note 8 – Vehicle Rental Activities to our Consolidated Financial Statements for more information regarding our vehicles. For a discussion of risk factors and assumptions relative to our vehicle valuations, refer to Item 1A, “Risk Factors”, included under Part 1 of this Annual Report on Form 10-K.

Public Liability, Property Damage and Other Insurance Liabilities. Insurance liabilities on our Consolidated Balance Sheets include additional/supplemental liability insurance, personal effects protection insurance, public liability, property damage and personal accident insurance claims for which we are self-insured. We estimate the required liability of such claims on an undiscounted basis utilizing an actuarial method that is based upon various assumptions which include, but are not limited to, our historical loss experience and projected loss development factors. The required liability is also subject to adjustment in the future based upon changes in claims experience, including changes in the number of incidents for which we are ultimately liable and changes in the cost per incident.

During the quarter ended MarchJune 31,30, 2026, we had no material developments to report with respect to our risk factors. For additional information regarding our risk factors, please refer to our 2025 Form 10-K.

We operate three of the most globally recognized brands in mobility solutions, Avis, Budget and Zipcar together with several other brands well recognized in their respective markets. We are a leading vehicle rental operator in North America, Europe, Australasia and certain other regions we serve, with an average rental fleet of approximately 620,000665,000 vehicles in firstsecond quarter 2026. We also license the use of our trademarks to licensees in the areas in which we do not operate directly. We and our licensees operate our brands in approximately 180 countries throughout the world.

Our strategy remains centered on driving sustainable growth through operational efficiency, analytics, customer experience and innovation. Additionally, during the fourth quarter of the fiscal year ended December 31, 2025, in conjunction with the Interpace Ventures transaction, we reviewed our fleet strategy, specific to certain United States EV rental car vehicles, and as a result shortened the useful life associated with such vehicles. We believe our strategies will continue to reinforce our competitive position, support long-term profitability, and deliver value to our stakeholders. During the three months ended MarchJune 31,30, 2026, we generated revenues of $2.5$3.0 billion, net lossincome of $234$63 million and Adjusted EBITDA loss of $113$286 million. These results were primarily driven by lower per-unit fleet costs and increased revenue per day, partially offset by decreased volume and higher per-unit fleet costs, excluding other fleet charges related to the disposal of certain fleet in our Americas reportable segment recorded in 2025.volume.

During the threesix months ended MarchJune 31,30, 2026:

•Our revenues totaled $2.5$5.5 billion, an increase of $100$59 million year-over-year, primarily due to increased revenue per day.day, partially offset by decreased volume.

•Our Adjusted EBITDA loss was $113$173 million, representing ana increased lossdecrease of $20$11 million year-over-year.

Three Months Ended MarchJune 31,30, 2026 vs. Three Months Ended MarchJune 31,30, 2025

Revenues increased $100$59 million during the threesix months ended MarchJune 31,30, 2026 compared to the similar period in 2025, primarily due to a 3%1% increase in revenue per day, excluding exchange rate effectseffects, and a $51$71 million positive impact from currency exchange rate movements, partially offset by a 1%2% decrease in volume. Total expenses decreased 8%5% during the threesix months ended MarchJune 31,30, 2026 compared to the similar period in 2025, primarily due to other fleet charges related to the disposal of certain fleet in our Americas reportable segment recorded in 2025. Our effective tax rates were a benefit of 31.2%36.0% and 25.6%24.6% for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. As a result of these items, our net loss attributable to Avis Budget Group, Inc. resulted in a decrease of $222$253 million compared to the similar period in 2025. For the threesix months ended MarchJune 31,30, 2026 and 2025, we reported diluted loss per share of $8.01$7.01 and $14.35,$14.24, respectively.

Operating expenses increased to 56.2%53.3% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 55.7%52.6% during the similar period in 2025, primarily due to increased facilities costs. Vehicle depreciation and lease charges decreased to 26.3%22.5% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 43.4%30.9% during the similar period in 2025, primarily due to other fleet charges related to the accelerated disposal of certain fleet in our Americas reportable segment recorded in 2025. Selling, general and administrative costs increasedwere to 13.5%13.1% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 12.7%12.9% during the similar period in 2025. Vehicle interest costs increased to 8.3% of revenue during the six months ended June 30, 2026 compared to 8.0% during the similar period in 2025, primarily due to increased commissions, marketing and other general and administrative costs. Vehicle interest costs increased to 9.0% of revenue during the three months ended March 31, 2026 compared to 8.6% during the similar period in 2025, primarily due increased interest rates, partially offset by decreased fleet levels.

(d)Consists of $1$3 million and $2 million reported within selling, general and administrative expenses for the threesix months ended MarchJune 31,30, 2026 and 2025, inrespectively eachand period.$1 million and $11 million reported within operating expenses for the six months ended June 30, 2026 and 2025, respectively.

Revenues increased during the threesix months ended MarchJune 31,30, 2026 compared to the similar period in 2025, primarily due to a 3%1% increase in revenue per day, excluding exchange rate effects and a $3$2 million positive impact from currency exchange rate movements.movements, partially offset by a 1% decrease in volume.

Operating expenses wereincreased 55.6%to 53.2% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 55.8%52.9% during the similar period in 2025.2025, primarily due to increased facilities costs. Vehicle depreciation and lease charges decreased to 27.1%22.9% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 48.4%33.2% during the similar period in 2025, primarily due to other fleet charges related to the accelerated disposal of certain fleet recorded in 2025. Selling, general and administrative costs increasedwere to 11.4%10.9% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 10.5%10.9% during the similar period in 2025, primarily due to increased commissions, marketing and other general and administrative costs.2025. Vehicle interest costs increased to 10.0%9.3% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 9.3%8.8% during the similar period in 2025, primarily due to increased interest rates, partially offset by decreased fleet levels.

Adjusted EBITDA loss increased during the threesix months ended MarchJune 31,30, 2026 compared to the similar period in 2025, primarily due to increased operating expenses, selling, general and administrative costs and vehicle interest costs, partially offset by increased revenue per day, excluding exchange rate effects.effects and decreased vehicle depreciation and lease charges, partially offset by increased operating expenses and vehicle interest costs, and a $1 million negative impact from currency exchange rate movements.

Revenues increased during the threesix months ended MarchJune 31,30, 2026 compared to the similar period in 2025, primarily due to a $48$69 million positive impact from currency exchange rate movements and a 3%2% increase in revenue per day, excluding exchange rate effects, partially offset by a 4%3% decrease in volume.

Operating expenses increased to 55.5%51.4% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 52.5%49.2% during the similar period in 2025, primarily due to increased fleet operating and facilities costs. Vehicle depreciation and lease charges decreased to 23.2%21.2% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 25.3%23.0% during the similar period in 2025, primarily due to decreased per-unit fleet costs, excluding exchange rate effects, driven by decreased fleet levels, partially offset by increased revenue. Selling, general and administrative costs increased to 17.9%17.4% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 16.7%16.0% during the similar period in 2025, primarily due to increased commissions, marketing and other general and administrative costs. Vehicle interest costs decreased to 5.7%5.2% of revenue during the threesix months ended MarchJune 31,30, 2026 compared to 6.3%5.5% during the similar period in 2025, primarily due to decreased fleet levels and sustained interest rates.

Adjusted EBITDA loss increaseddecreased during the threesix months ended MarchJune 31,30, 2026 compared to the similar period in 2025, primarily due to increased operating expenses and selling, general and administrative costs and approximately a $5 million negative impact from currency exchange rate movements, partially offset by increased revenue per day, excluding exchange rate effects.

The decreasesincreases in both assets under vehicle programs and liabilities under vehicle programs are primarily due to the decreaseincrease in the sizecost of our rental fleet and related debt.

During 2026, our Avis Budget Rental Car Funding (AESOP) LLC subsidiary issued approximately $922$1,572 million of asset-backed notes with expected final payment dates ranging from August 2027 to AugustDecember 2031 and a weighted average interest rate of 5.36%.5.35%. Avis Budget Rental Car Funding (AESOP) LLC has also amended and extended its asset-backed variable funding financing facilities, most recently in DecemberApril 2025.2026. The proceeds from these borrowings were used to fund the repayment of maturing vehicle-backed debt and the acquisition of rental cars in the United States.

In March 2026, we entered into an Equity Distribution Agreement with certain sales agents, in which we may sell, from time to time through or to the sales agents, as our agents or as principals, up to 5 million shares of our common stock (the “ATM Program”). The sales, if any, of the shares of our common stock made under the Equity Distribution Agreement may be made in sales deemed to be “at-the-market offerings.” As of MarchJune 31,30, 2026, we have not sold any shares of our common stock under the ATM Program.

Our Board of Directors has authorized the repurchase of up to approximately $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023 (the “Stock Repurchase Program”). Our stock repurchases may occur through open market purchases, privately negotiated transactions or trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements, restricted payment capacity under our debt instruments and other factors. The Stock Repurchase Program may be suspended, modified or discontinued at any time without prior notice. The Stock Repurchase Program has no set expiration or termination date. During the threesix months ended MarchJune 31,30, 2026, we did not repurchase shares of common stock under the Stock Repurchase Program. As of MarchJune 31,30, 2026, approximately $757 million of authorization remained available to repurchase common stock under the Stock Repurchase Program.

Cash provided by operating activities during the threesix months ended MarchJune 31,30, 2026 decreased when compared with the similar period in 2025, primarily due to changes in the components of working capital.

Cash providedused byin investing activities during the threesix months ended MarchJune 31,30, 2026 increaseddecreased when compared with the similar period in 2025, primarily due to the increase in our proceeds received on vehicle sales and the decrease in our investment in vehicles.

Cash usedprovided inby financing activities during the threesix months ended MarchJune 31,30, 2026 increaseddecreased when compared with the similar period in 2025, primarily due to the decrease in both our corporate borrowings and borrowings under vehicle programs.

As of MarchJune 31,30, 2026, we had approximately $24.4$25.9 billion of indebtedness, including corporate indebtedness of approximately $6.0 billion and debt under vehicle programs of approximately $18.4$19.9 billion. For information regarding our debt and borrowing arrangements, see Note 1 – Basis of Presentation, Note 11 – Long-term Corporate Debt and Borrowing Arrangements and Note 12 – Debt Under Vehicle Programs and Borrowing Arrangements to our Condensed Consolidated Financial Statements.

Our primary liquidity needs include the procurement of rental vehicles to be used in our operations, servicing of corporate and vehicle-related debt and the payment of operating expenses. The present intention of management is to reinvest the undistributed earnings of our foreign subsidiaries indefinitely into our foreign operations. Our primary sources of funding are operating revenue, cash received upon the sale of vehicles, borrowings under our vehicle-backed borrowing arrangements and our senior revolving credit facility,facilities, and other financing activities.

As of MarchJune 31,30, 2026, we had $528$558 million of available cash and cash equivalents and access to $387$471 million of available borrowing capacity under our revolving credit facility,facilities providing us with access to approximately $915$1,029 million of total liquidity.

Our liquidity position could also be negatively impacted if we are unable to remain in compliance with the consolidated first lien leverage ratio requirement and other covenants associated with our senior credit facilities and other borrowings. As of MarchJune 31,30, 2026, we were in compliance with the financial covenants governing our indebtedness. For additional information regarding our liquidity risks, see Part I, Item 1A, “Risk Factors” of our 2025 Form 10-K.

Our future contractual obligations have not changed significantly from the amounts reported within our 2025 Form 10-K with the exception of our commitment to purchase vehicles, which decreased by approximately $1.7$4.2 billion from December 31, 2025, to approximately $5.1$2.6 billion as of MarchJune 31,30, 2026 due to existing fleet levels. Changes to our obligations related to corporate indebtedness and debt under vehicle programs are presented above within the section titled “Liquidity and Capital Resources—Debt and Financing Arrangements” and also within Note 11 – Long-term Corporate Debt and Borrowing Arrangements and Note 12 – Debt Under Vehicle Programs and Borrowing Arrangements to our Condensed Consolidated Financial Statements.