Equipment rental company United Rentals (NYSE: URI) missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 2.8% year on year to $4.21 billion. On the other hand, the company’s outlook for the full year was close to analysts’ estimates with revenue guided to $17.05 billion at the midpoint. Its non-GAAP profit of $11.09 per share was 6.1% below analysts’ consensus estimates.
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United Rentals (URI) Q4 CY2025 Highlights:
- Revenue: $4.21 billion vs analyst estimates of $4.24 billion (2.8% year-on-year growth, 0.7% miss)
- Adjusted EPS: $11.09 vs analyst expectations of $11.80 (6.1% miss)
- Adjusted EBITDA: $1.90 billion vs analyst estimates of $1.93 billion (45.2% margin, 1.6% miss)
- EBITDA guidance for the upcoming financial year 2026 is $7.7 billion at the midpoint, in line with analyst expectations
- Operating Margin: 25%, down from 26.5% in the same quarter last year
- Free Cash Flow Margin: 23.5%, up from 20.4% in the same quarter last year
- Market Capitalization: $57.74 billion
Company Overview
Owning the largest rental fleet in the world, United Rentals (NYSE: URI) provides equipment rental and related services to construction, industrial, and infrastructure industries.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Thankfully, United Rentals’s 13.5% annualized revenue growth over the last five years was exceptional. Its growth beat the average industrials company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. United Rentals’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 6% over the last two years was well below its five-year trend. 
This quarter, United Rentals’s revenue grew by 2.8% year on year to $4.21 billion, falling short of Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 5.5% over the next 12 months, similar to its two-year rate. This projection doesn't excite us and indicates its newer products and services will not accelerate its top-line performance yet.
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Operating Margin
United Rentals has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 25.9%. This result isn’t surprising as its high gross margin gives it a favorable starting point.
Looking at the trend in its profitability, United Rentals’s operating margin rose by 1.2 percentage points over the last five years, as its sales growth gave it operating leverage.
This quarter, United Rentals generated an operating margin profit margin of 25%, down 1.5 percentage points year on year. Since United Rentals’s gross margin decreased more than its operating margin, we can assume its recent inefficiencies were driven more by weaker leverage on its cost of sales rather than increased marketing, R&D, and administrative overhead expenses.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
United Rentals’s EPS grew at an astounding 19.2% compounded annual growth rate over the last five years, higher than its 13.5% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
Diving into the nuances of United Rentals’s earnings can give us a better understanding of its performance. As we mentioned earlier, United Rentals’s operating margin declined this quarter but expanded by 1.2 percentage points over the last five years. Its share count also shrank by 12.4%, and these factors together are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
For United Rentals, its two-year annual EPS growth of 1.6% was lower than its five-year trend. We hope its growth can accelerate in the future.
In Q4, United Rentals reported adjusted EPS of $11.09, down from $11.59 in the same quarter last year. This print missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects United Rentals’s full-year EPS of $42.12 to grow 12.5%.
Key Takeaways from United Rentals’s Q4 Results
We struggled to find many positives in these results. Its EPS missed and its revenue fell slightly short of Wall Street’s estimates. Overall, this was a softer quarter. The stock traded down 5.1% to $857.50 immediately after reporting.
The latest quarter from United Rentals’s wasn’t that good. One earnings report doesn’t define a company’s quality, though, so let’s explore whether the stock is a buy at the current price. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).
