Custom Truck One Source, Inc.

What they do

CTOS rents, manufactures, sells and services specialty equipment including bucket trucks, digger derricks, dump trucks, cranes, service trucks and heavy-haul trailers. It operates out of more than 40 locations across the U.S. and Canada, supported by a 24/7 call center, roughly 90 mobile technicians and over 2,600 third-party service partners. Its rental fleet exceeded 10,400 units as of December 31, 2025, with an average unit age of about 2.9 years.

Revenue drivers

• Specialty Truck Equipment and Manufacturing (STEM) — Equipment sales, manufacturing and customization; external customer revenue was $345 million and equipment sales $332 million in Q2 2026. Consolidated equipment sales were $383.6 million of $563.4 million total revenue in the quarter.
• Specialty Equipment Rentals (SER) — Rental of specialty fleet focused on electric utility transmission and distribution, rail and telecom; rental revenue was $145.1 million in Q2 2026. Total OEC reached $1.68 billion at quarter-end, the highest in company history.
• Parts sales and services — Aftermarket parts and repair, maintenance and customization services; contributed $34.8 million of revenue in Q2 2026. Previously reported as the APS segment before the 2026 realignment.
• Used equipment sales — Sale of rental fleet units and used inventory; part of the equipment sales line alongside new equipment. The company cites a long useful life for rental equipment as supporting residual values.

Recent performance

Second quarter 2026 revenue was a record $563.4 million, up 10.2% year over year. Gross profit rose 20.9% to $124.0 million and Adjusted EBITDA rose 25.0% to $116.8 million. Net income was $10.4 million, an improvement of $38.8 million from the prior-year quarter. First half 2026 revenue was $1,025.1 million with net income of $6.3 million versus a $46.2 million loss a year earlier. Net leverage fell to 3.85x at quarter-end from 4.02x at the end of Q1 2026 and 4.31x at year-end 2025.

Strategy

Management realigned reporting into two segments, SER and STEM, beginning in the first quarter of 2026, replacing the prior ERS, TES and APS structure. The company emphasizes a one-stop-shop model across rental, sales and aftermarket service, plus large-scale integrated production and customization capabilities. Priorities cited are Adjusted EBITDA growth, working capital management, free cash flow generation and continued deleveraging. Fleet investment continues, with total OEC reaching a record $1.68 billion at the end of Q2 2026.

Risks

• Supply chain and tariffs — The company cites tariffs, trade policy changes and inability to obtain raw materials, component parts or finished goods in a timely and cost-effective manner as risks to manufacturing and sales.
• Rental fleet management — Rental equipment has a long economic life and must be maintained and repositioned cost-effectively; misalignment with regional demand could leave excess inventory in some regions.
• Significant indebtedness — Long-term debt was $1.66 billion at June 30, 2026, and the company cites debt agreements, variable-rate exposure and default risk as material risks.
• End-market and government spending dependence — Demand is tied to utility, telecom, rail and infrastructure spending, and the company notes its business may be impacted by government spending and regulatory or technological changes in its core end markets.

Outlook

Management raised full-year 2026 revenue guidance to $2.1 billion to $2.2 billion from $2.005 billion to $2.12 billion, and Adjusted EBITDA guidance to $437.5 million to $455 million from $415 million to $440 million. The CEO cited sustained strength in transmission and distribution markets as the primary driver of SER performance. Management points to data center investment, electrification, utility grid upgrades and infrastructure spending as secular tailwinds for the second half of 2026.