Custom Truck One Source Reports Q1 2025 Revenue Growth but Increased Net Loss

Custom Truck One Source, Inc. reported its financial results for the first quarter of 2025, revealing total revenue of $422.2 million, a 2.7% increase from $411.3 million in the same period of 2024. The growth was primarily driven by a 9.5% rise in rental revenue, which reached $116.3 million, up from $106.2 million. Equipment sales also saw a slight increase, totaling $273.9 million compared to $272.6 million in the prior year. However, the company experienced a decline in net income, reporting a loss of $17.8 million, compared to a loss of $14.3 million in the previous year.

The company's gross profit decreased to $85.5 million, down 5.7% from $90.7 million in the first quarter of 2024. This decline was attributed to increased costs associated with rental equipment depreciation and higher operating expenses, which rose to $73.1 million from $72.3 million. The increase in operating expenses was largely due to higher general and administrative costs, including increased compensation. Additionally, total other expenses rose to $37.9 million, primarily driven by higher interest expenses related to variable-rate debt.

In terms of operational metrics, Custom Truck One Source reported an ending original equipment cost (OEC) of $1.55 billion, a 6.6% increase from the previous year. The average OEC on rent also increased by 12.8% to $1.20 billion. Fleet utilization improved to 77.7%, up from 73.3% in the prior year, indicating more efficient use of rental equipment. However, the company's sales order backlog decreased significantly by 21.8% to $420.1 million, reflecting potential challenges in future revenue generation.

Strategically, the company has been active in managing its capital structure, including a stock repurchase program that has been expanded to allow for the repurchase of up to $80 million in shares. In January 2025, Custom Truck repurchased 8.1 million shares from affiliates of Energy Capital Partners for $32.6 million. The company also reported a cash balance of $5.4 million as of March 31, 2025, an increase from $3.8 million at the end of 2024, and highlighted its compliance with covenants under its asset-based revolving credit facility.

Looking ahead, Custom Truck One Source anticipates continued challenges due to market conditions, including high-interest rates affecting equipment sales. The company remains focused on optimizing its rental fleet and enhancing operational efficiencies to drive future growth. Management expressed confidence in the company's liquidity and operational strategies to navigate the evolving market landscape.