Custom Truck One Source, Inc. (CTOS): Business Model Canvas [Dec-2025 Updated]

You're digging into the financials of a major player in infrastructure support, and frankly, understanding how Custom Truck One Source, Inc. actually makes its money across sales, rentals, and parts can feel like navigating a complex job site. As someone who's spent two decades mapping out industrial giants, I can tell you their model hinges on a massive, specialized fleet-over 10,350 units-and a true one-stop-shop approach that drove their 2025 sales guidance toward $1.21 billion in the Truck and Equipment Sales (TES) segment alone. But with that scale comes debt, sitting north of $2.49 billion trailing twelve months, so let's break down exactly how this coast-to-coast network balances high utilization, like the 79.3% seen in Q3 2025, against its capital structure in the Business Model Canvas below.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Key Partnerships

You're looking at the backbone of Custom Truck One Source, Inc. (CTOS)'s ability to deliver specialized equipment and services across North America. The Key Partnerships block isn't just a list of names; it's about the deep, often multi-decade, relationships that ensure supply chain stability and service reach. Honestly, in this capital-intensive business, these alliances are as critical as your own balance sheet.

The relationships with major chassis and attachment suppliers for vocational vehicles are foundational, especially for the TES segment (Truck and Equipment Sales). Custom Truck One Source, Inc. explicitly mentions its multi-decade relationships with strategic suppliers as a key to success, which helps them navigate things like evolving U.S. tariff policies. These partnerships are essential for maintaining the flow of customized and stock equipment that feeds both sales and the rental fleet.

For the customer side, the utility and telecom sectors represent your most significant, long-tenured revenue drivers. The company serves a diverse customer base, but the Electric Utility Transmission and Distribution (T&D) market is a core focus. Utility contractor customers, for instance, have signaled sustained and increased activity expected to persist at least through the end of 2025, driven by secular growth in electricity demand and maintenance spending. The strength of these relationships is reflected in the fleet utilization; for Q2 2025, average utilization was just under 78%, up almost 600 basis points versus Q2 2024.

Financing these massive assets requires strong ties with financial institutions. You know the capital intensity here; as of September 30, 2025, total debt outstanding stood at $1,666.4 million, resulting in the reported debt-to-equity ratio of 2.08. This level of leverage means managing floor plan liabilities and securing favorable credit terms is a constant priority for the finance team. The expectation to generate meaningful levered free cash flow, targeting more than $50 million in 2025, is partly dependent on managing these financial partnerships effectively.

Finally, nationwide service coverage is a major component of the value proposition, especially for rental customers. While the exact number of independent service providers isn't public, the scale of the operation is clear: the coast-to-coast rental fleet comprised approximately 10,300 units as of the second quarter of 2025. These service providers are crucial for ensuring that equipment, which includes aerial devices, boom trucks, and digger derricks, remains operational for customers maintaining critical infrastructure assets.

Here's a quick look at some of the key operational and financial metrics tied to these partnerships as of late 2025:

Metric	Value/Data Point	Period/Context
Debt-to-Equity Ratio	2.08	Latest Reported Figure
Total Debt Outstanding	$1,666.4 million	As of September 30, 2025
Net Leverage Ratio	4.53x	As of September 30, 2025
Rental Fleet Size	Approximately 10,300 units	As of Q2 2025
Average Rental Fleet Utilization	Just under 78%	Q2 2025
Expected Levered Free Cash Flow	More than $50 million	2025 Guidance

The relationships with key customers in the utility and telecom sectors drive the utilization rates and the need for fleet investment. For example, the average OEC on rent (Original Equipment Cost) for Q2 2025 was over $1.2 billion, a 16% year-over-year increase. This growth in assets on rent directly reflects the confidence Custom Truck One Source, Inc. has in its customer base.

The company's operational segments rely on these external relationships in specific ways:

• Utility/Telecom Customers: Drive strong demand in ERS (Equipment Rental Services) and TES segments.
• Strategic Suppliers: Essential for managing the sales order backlog, which was up just under 35% year-over-year in Q3 2025 signed orders.
• Financial Institutions: Support the capital structure where the current ratio is 1.27 and the quick ratio is 0.22.
• Independent Service Providers: Underpin the ability to service a coast-to-coast fleet of over 10,000 units.

Finance: draft the covenant compliance check against the 4.53x net leverage ratio for Q4 2025 by next Tuesday.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Key Activities

You're looking at the core engine of Custom Truck One Source, Inc. (CTOS) operations, which really boils down to three distinct but connected activities. It's not just about renting; it's about building, maintaining, and servicing the specialized gear that keeps critical infrastructure running.

Customization and production of specialized vocational equipment (TES segment)

The Truck & Equipment Sales (TES) segment is where Custom Truck One Source, Inc. builds and sells specialized vocational vehicles. This activity is a major revenue driver, with the full-year 2025 revenue outlook set between $1,160 million and $1,210 million.

For the third quarter of 2025, the revenue in the TES segment specifically grew 6.0% year-over-year, showing continued demand from end markets like utility and telecom. However, you should note that the TES backlog was down 29% compared to the third quarter of 2024, though it still sits just below the expected range of four to six months.

Here's a quick look at how the segments stack up against the full-year 2025 revenue guidance:

Segment	2025 Revenue Outlook (Low End)	2025 Revenue Outlook (High End)
TES (Sales)	$1,160 million	$1,210 million
ERS (Rental)	$660 million	$690 million
APS (Parts/Service)	$150 million	$160 million

Management and maintenance of a large rental fleet (over 10,350 units)

Managing the Equipment Rental Solutions (ERS) fleet is central to the business, and it's a big fleet, clocking in at more than 10,350 units across the coast-to-coast operations. Keeping that massive asset base utilized is key to profitability; for instance, in the third quarter of 2025, average fleet utilization hit 79.3%, a solid jump from 73.2% in the third quarter of 2024.

The return on that fleet is tracked by the Average Operating Equipment Cost (OEC) on rent. That metric increased by $180 million, or 17%, year-over-year in Q3 2025. The total OEC on rent at the end of Q2 2025 was $1.56 billion, which was the highest in the company's history at that point.

The performance of the rental side in Q3 2025 looked like this:

• ERS segment rental revenue increased 17.7% year-over-year.
• ERS segment revenue outlook for full-year 2025 is $660 million to $690 million.
• The operating margin for the entire company in Q3 2025 was 6.8%.

Aftermarket parts distribution and repair services (APS segment)

The Aftermarket Parts & Service (APS) segment provides the necessary support to keep equipment running, whether it's customer-owned or part of the Custom Truck One Source, Inc. rental fleet. This activity is a steady contributor, with a full-year 2025 revenue outlook between $150 million and $160 million.

For the third quarter of 2025, APS segment revenue saw a 3.0% increase compared to the third quarter of 2024, largely due to higher rental revenue feeding into service needs. The company reported that consolidated parts sales and service revenue remained flat year-over-year in the second quarter of 2025.

Strategic inventory investment to support new equipment demand

Custom Truck One Source, Inc. actively invests in inventory to meet demand for new equipment sales and to grow the rental fleet. Given the strong demand environment seen over the last four fiscal quarters, management increased its expected investment for the year.

Here are the key investment figures:

• Expected net investment in the rental fleet for 2025 is up to an additional $50 million.
• This investment is anticipated to result in at least high-single digit fleet growth based on net OEC for 2025.
• Total consolidated revenue guidance for the full year 2025 is $1,970 million to $2,060 million.
• The trailing 12-month revenue as of September 30, 2025, was $1.94B.

This focus on inventory and fleet growth is intended to support the overall 2025 Adjusted EBITDA guidance, which is set between $370 million and $390 million. It's a defintely capital-intensive activity, but one that supports the high-value rental and sales streams.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Key Resources

You're looking at the core assets that make Custom Truck One Source, Inc. (CTOS) tick as of late 2025. These aren't just line items; they are the physical and intellectual capital driving their specialized infrastructure support model.

The scale of their physical footprint and asset base is a massive barrier to entry for competitors. Consider the total value of the equipment they own, which reached $1.55 billion in Owned Equipment Cost (OEC) at the end of the first quarter of 2025, the highest in their history. This massive asset base requires constant attention, which brings us to the people who maintain it.

Here's a breakdown of the tangible and intangible resources supporting the Custom Truck One Source, Inc. (CTOS) operations:

Key Resource	Metric/Detail	Latest Available Data Point (Late 2025 Context)
Physical Footprint	Coast-to-coast network of physical locations	41 Locations
Specialized Rental Fleet	Total units available for rent	More than 10,350 units
Fleet Utilization (Operational Metric)	Average utilization rate for rental fleet	79.3% in the third quarter of 2025
Proprietary Manufacturing Arm	Load King brand for captive parts and equipment	Unveiled new equipment like the Outback Series at Utility Expo 2025
Skilled Labor & Service Capacity	Technicians for customization and repair	Total OEC base requiring maintenance was $1.55 billion as of Q1 2025

The rental fleet size is substantial, and its efficiency is clearly improving; the average OEC on rent increased by 17% year-over-year in the third quarter of 2025. That's real utilization growth.

The proprietary aspect, Load King Manufacturing, is vital because it feeds the ecosystem with specialized trailers and equipment. This captive source helps control supply chain risk for their core rental and sales businesses, which are projected to generate consolidated revenue between $1,970 million and $2,060 million for the full year 2025.

You can see the scale of the service component through the segment outlooks. The TES (Truck Equipment Sales) segment, which includes Load King products, has a 2025 revenue outlook between $1,160 million and $1,210 million. The ERS (Equipment Rental and Sales) segment, which relies heavily on the owned fleet and technicians, is looking at revenue between $660 million and $690 million.

The service and parts revenue stream, which depends on those skilled technicians, remained flat year-over-year in the first quarter of 2025 compared to the first quarter of 2024. Still, the overall gross profit margin improvement in Q3 2025 suggests the service and parts component is holding its own while the rental side drives top-line growth.

The key resources boil down to this:

• Geographic Reach: 41 physical locations supporting a coast-to-coast operation.
• Asset Depth: Rental fleet exceeding 10,350 units.
• Manufacturing Integration: The Load King brand ensures a pipeline of specialized, captive equipment.
• Human Capital: Technicians capable of servicing an asset base valued at $1.55 billion in OEC.

Finance: draft 13-week cash view by Friday.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Value Propositions

You're looking at the core reasons why Custom Truck One Source, Inc. (CTOS) captures market share, especially in the demanding infrastructure space. The value proposition centers on integration and asset performance.

One-stop-shop model for rental, sales, parts, and service

Custom Truck One Source, Inc. offers a differentiated "one-stop-shop" business model, which is a key value driver. This model integrates four core offerings:

• Rental of specialty equipment.
• Sales of new and used equipment.
• Parts supply.
• Aftermarket service operations.

The company organizes this through three segments: Equipment Rental Solutions (ERS), Truck and Equipment Sales (TES), and Aftermarket Parts and Services (APS). For instance, in Q3 2025, the ERS segment rental revenue increased by 17.7% year-over-year.

Access to a specialized fleet for critical infrastructure work

The fleet is specialized, focusing on maintenance, repair, upgrade, and installation for critical infrastructure assets. This includes electric lines, telecommunications networks, and rail systems. The Transmission & Distribution (T&D) market is a cornerstone, representing 55% of the business as of late 2025. You get access to a coast-to-coast rental fleet comprising more than 10,350 units.

Equipment customization to meet unique project specifications

A significant part of the value is the ability to tailor equipment. This is evident in the sales order backlog, which includes purchase orders received specifically for customized equipment, alongside stock units. This capability directly supports the unique demands of specialized infrastructure projects.

High fleet utilization rate, reaching 79.3% in Q3 2025

Operational efficiency translates directly into value for Custom Truck One Source, Inc. through higher asset returns. The average utilization of the rental fleet hit 79.3% in the third quarter of 2025. That's a 610 basis point improvement compared to the 73.2% utilization seen in Q3 2024. The momentum continued into the next period, with Q4 2025 utilization already standing at more than 80%. This high utilization supported a 17% year-over-year increase in average Owned Equipment Cost (OEC) on rent for Q3 2025.

Here's a quick look at some key metrics underpinning these value propositions from the Q3 2025 report:

Metric	Value (Q3 2025)	Comparison/Context
Average Rental Fleet Utilization	79.3%	Up from 73.2% in Q3 2024
Average OEC on Rent Growth (YoY)	17%	Driven by increased rental volume
Total Rental Fleet Size	More than 10,350 units	Coast-to-coast fleet
T&D Market Revenue Share	55%	Represents the core business segment
Total Revenue (Q3 2025)	$482.1 million	Up 7.8% year-over-year

The company's ability to drive utilization up while growing the asset base-ending Q3 2025 with total OEC of $1.56 billion-shows they are effectively meeting infrastructure demand. Finance: draft 13-week cash view by Friday.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Customer Relationships

You're looking at how Custom Truck One Source, Inc. manages its interactions across its diverse client base, which spans electric utility transmission and distribution (T&D), telecommunications, and rail systems.

Dedicated account management for large utility and rail customers

Custom Truck One Source, Inc. serves over 8,000+ Customers across North America. The relationship structure is clearly tiered, with the largest infrastructure players receiving focused attention. In the first quarter of 2025, the top 15 customers accounted for approximately 18% of total revenue. Importantly, no single customer represented more than 3% of company revenue as of Q1 2025, suggesting a reliance on a broad base even among the largest accounts. The core of the Equipment Rental Solutions (ERS) segment is driven by utility contractors whose activity is expected to persist at least through the end of 2025.

High-touch, consultative sales for complex equipment purchases

The Truck & Equipment Sales (TES) segment, which deals with vocational vehicles, requires this deeper engagement. The company's coast-to-coast rental fleet, which stood at more than 10,350 units as of Q3 2025, is a key resource for consultative sales, allowing customers to test equipment before committing to purchase. The strength of this approach is reflected in the order flow; signed orders in Q3 2025 were up 30% on a year-over-year basis, with more than 40% growth among local and regional accounts. The TES segment's sales order backlog at the end of Q1 2025 represented approximately 4.8 months of new equipment sales, indicating significant forward commitment from customers.

Transactional relationships for aftermarket parts and tools

The Aftermarket Parts & Service (APS) segment supports relationships that are more frequent but lower-touch, focusing on consumables and routine needs. Consolidated parts sales and service revenue remained flat year-over-year in the first quarter of 2025. The APS segment revenue outlook for the full year 2025 was guided between $150 million and $160 million.

Service-oriented support for maintenance and repair operations

Maintenance and repair are embedded in the service offering, often tied to the rental fleet to ensure uptime. The ERS segment saw average fleet utilization increase to 79.3% in Q3 2025, up from 73.2% in Q3 2024, demonstrating the effectiveness of keeping the fleet operational. The average Original Cost of Equipment (OEC) on rent increased by $179.8 million, or 16.6%, in the third quarter of 2025 compared to the third quarter of 2024, requiring robust support infrastructure.

Here are some key financial and operational metrics from the 2025 reporting periods:

Metric	Value/Range (2025)	Reporting Period/Context
Total Revenue (Q3)	$482.1 million	Three Months Ended September 30, 2025
Full-Year Revenue Guidance (Midpoint)	$2.02 billion	Reaffirmed in Q3 2025
Adjusted EBITDA (Q3)	$96.0 million	Three Months Ended September 30, 2025
ERS Segment Rental Revenue Growth	17.3%	Q2 2025 vs. Q2 2024
Average ERS Fleet Utilization	Over 79%	Q3 2025
Average OEC on Rent Increase	$179.8 million	Q3 2025 vs. Q3 2024
Total Customers	8,000+	General Metric
Top 15 Customer Revenue Concentration	18%	Q1 2025

The company's strategy relies on high utilization of its rental assets to drive service demand. The ERS segment rental revenue grew 9.4% in the first quarter of 2025 compared to the first quarter of 2024. The overall fleet size is reported to be approximately 10,000 units or more than 10,350 units.

• Utility contractor customers expect sustained activity through the end of 2025.
• The company maintains a coast-to-coast rental fleet of approximately 10,000 units.
• Q3 2025 Adjusted EBITDA was $96.0 million, up 19.6% year-over-year.
• The company expects to generate $50 million to $100 million of levered free cash flow in 2025.

The relationship is further defined by the equipment sales cycle; the TES segment backlog at the end of Q3 2025 was $279.8 million. This backlog is supported by strong relationships with chassis and attachment suppliers.

Finance: draft 13-week cash view by Friday.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Channels

You're looking at how Custom Truck One Source, Inc. (CTOS) gets its specialized equipment and services to customers across North America. The channels strategy is built around a physical footprint supported by direct sales and digital access for parts.

Network of physical service and sales centers across North America

The physical network is the backbone for both rental and service operations. Custom Truck One Source, Inc. is actively expanding this footprint to better serve regional demand. For instance, a new location opened in Portland, Oregon, on June 1, 2025, adding 12,000 square feet of space and six service bays to the national presence. Also, a new facility was announced for Orlando, Florida, set to open on October 1, 2025, which will add 20,000 square feet and 11 service bays. As of October 2025, the company has approximately 1.1K employees across North America and Europe.

The physical locations support the Equipment Rental Solutions (ERS) segment, which is a major channel for equipment access. The coast-to-coast rental fleet is substantial:

• Rental fleet size: more than 10,350 units.
• Average Original Equipment Cost (OEC) on rent (Q3 2025): up 16.6% year-over-year.
• Average fleet utilization (Q3 2025): reached 79.3%.
• OEC in the rental fleet (End of Q1 2025): just under $1.55 billion.

Direct sales force for new and used equipment (TES segment)

The Truck and Equipment Sales (TES) segment relies heavily on a direct sales approach, driven by robust demand for vocational vehicles. This segment is expected to generate the most revenue in 2025, with guidance between $1,160 million and $1,210 million. The sales channel is supported by a healthy order book, though the backlog has seen fluctuations. For example, the TES new sales backlog at the end of Q1 2025 was just over $420 million.

The direct sales channel is critical for moving new and used equipment, including used rental units sold directly to customers. Here's a look at the sales and rental channel performance metrics for 2025:

Metric	ERS Segment 2025 Revenue Guidance (Low)	ERS Segment 2025 Revenue Guidance (High)	TES Segment 2025 Revenue Guidance (Low)	TES Segment 2025 Revenue Guidance (High)
Revenue (in millions USD)	$660 million	$690 million	$1,160 million	$1,210 million
Q2 2025 Revenue Growth (YoY)	20.9% (Total Revenue Growth)		22.4% (TES Revenue Growth Q2 2025)
Q3 2025 Revenue Growth (YoY)	7.8% (Total Revenue Growth)		6.0% (TES Revenue Growth Q3 2025)

Equipment Rental Solutions (ERS) segment for fleet deployment

The ERS segment uses its extensive, growing fleet as a primary channel for revenue generation. The company is actively deploying capital to meet demand, expecting mid-single-digit growth in net Original Equipment Cost (OEC) for the rental fleet in 2025. Following strong Q3 results, Custom Truck One Source, Inc. indicated plans to invest up to an additional net $50 million in the rental fleet for the year compared to previous guidance. The ERS segment revenue guidance for 2025 is between $660 million and $690 million.

The utilization rates show how effectively this channel is being used:

• Average utilization (Q3 2025): 79.3%.
• Average utilization (Q2 2025): 77.9%.
• Average utilization (Q1 2025): just under 78%.

E-commerce and parts counter for Aftermarket Parts and Services (APS)

The Aftermarket Parts and Services (APS) segment serves as a channel for parts, tools, and repair services, often supporting existing rental and sales customers. The 2025 revenue outlook for APS is set between $150 million and $160 million. Revenue in the APS segment saw an increase of 2.6% in the second quarter of 2025 compared to the second quarter of 2024, which was noted as being due to an increase in rental revenue. This indicates the parts and service counter is integrated with the core rental business.

The overall financial context for these channels as of late 2025 guidance is:

• Reaffirmed Full-Year 2025 Revenue Guidance (Midpoint): $2.02 billion.
• Reaffirmed Full-Year 2025 Adjusted EBITDA Guidance (Midpoint): $380 million.
• Expected Levered Free Cash Flow (2025): at least $50 million.

Finance: draft 13-week cash view by Friday.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Customer Segments

You're looking at the core groups Custom Truck One Source, Inc. (CTOS) serves to generate its revenue, which for the trailing twelve months ending September 30, 2025, reached $1.94 billion, up 7.39% year-over-year. The company serves a diverse customer base of over 8,000 customers across North America with a fleet exceeding 10,350 units.

The primary focus, representing the largest single market, is clearly the electric utility sector, which drives a significant portion of the business activity.

• Electric utility transmission and distribution (T&D) represents 55% of Custom Truck One Source, Inc.'s business.
• This segment is expected to benefit from spending required for data center investments and electrification.
• U.S. Investor-Owned Utility T&D capital spending is projected to total almost $600 billion from 2025 to 2029.
• Transmission spending within that is expected to grow at a 15%+ compound annual growth rate (CAGR).

The company's structure, broken down by its internal segments (Equipment Rental Solutions (ERS), Truck & Equipment Sales (TES), and Aftermarket Parts & Service (APS)), provides a financial lens on how these customer demands translate:

Customer Market Focus	Primary CTOS Segment Driver	2025 Full-Year Revenue Guidance (Low End)	2025 Full-Year Revenue Guidance (High End)
Electric utility T&D	TES and ERS	$1.16 billion (TES component)	$1.21 billion (TES component)
Telecommunications and rail infrastructure contractors	TES and ERS	$660 million (ERS component)	$690 million (ERS component)
Local and regional construction/infrastructure customers	TES	$150 million (APS component)	$160 million (APS component)
Forestry and waste management service providers	TES and ERS	N/A (Grouped in overall guidance)	N/A (Grouped in overall guidance)

The Equipment Rental Solutions (ERS) segment showed strong rental revenue growth of 17.7% in the third quarter of 2025 compared to the third quarter of 2024, with average fleet utilization reaching 79.3%. The full-year guidance for the ERS segment is $660 million to $690 million, representing 10-15% growth.

Local and regional customers are showing particularly strong purchasing intent, which is a good sign for near-term sales volume. You see this in the order book activity.

• Signed orders in the third quarter of 2025 were up 30% year-over-year.
• More than 40% of those signed orders came from local and regional accounts in Q3 2025.

The Truck and Equipment Sales (TES) segment, which handles the bulk of the equipment sales, has a 2025 guidance range of $1.16 billion to $1.21 billion, projecting 10-15% growth. This segment serves the T&D, telecom, and rail markets directly through equipment sales. The Aftermarket Parts and Services (APS) segment, which supports maintenance and repair across all these customer types, is guided to generate $150 million to $160 million in 2025.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Cost Structure

You're looking at the major expenses that eat into Custom Truck One Source, Inc.'s revenue, which is critical for understanding their asset-heavy model. Honestly, the cost structure is dominated by the equipment itself, both in acquisition and in keeping it running.

High Cost of Revenue, Including Equipment Depreciation

The cost of revenue is naturally high because Custom Truck One Source, Inc. is in the business of renting and selling heavy, specialized machinery. For the third quarter ended September 30, 2025, the reported Gross Profit was $100.8 million on $482.1 million in Total Revenue. This implies a Cost of Revenue of approximately $381.3 million for that quarter alone.

Depreciation is a massive, non-cash component of this. Looking at the trailing twelve months (TTM) ending March 31, 2025, the Depreciation of rental equipment was reported at ($49) million. This non-cash charge reflects the rapid wear and tear or scheduled obsolescence of their large, specialized fleet.

The company uses Adjusted Gross Profit to better gauge operational performance before this non-cash charge. For Q3 2025, Adjusted Gross Profit hit $155.5 million, up 12.9% year-over-year, which shows the underlying rental and sales margins are improving even with high depreciation.

Significant Interest Expense Due to High Total Debt

Carrying a large fleet means carrying significant debt, which translates directly into interest expense. As of September 30, 2025, Custom Truck One Source, Inc.'s Total Debt Outstanding was $1,666.4 million, resulting in a Net Leverage Ratio of 4.53x. While you mentioned a TTM debt figure over $2.49 billion, the latest reported outstanding debt as of the end of Q3 2025 is this $1.666 billion figure. The company remains committed to achieving a 3x net leverage target by the end of fiscal 2026.

Interest costs are a real cash drain. For the first half of 2025, the company noted that lower interest expense on variable-rate floor plan liabilities actually helped boost Q3 2025 Adjusted EBITDA. This suggests that while interest expense is significant, fluctuations in borrowing costs directly impact near-term profitability.

Costs Related to Maintaining a Large, Specialized Equipment Fleet

The fleet itself is a cost center beyond just depreciation. Custom Truck One Source, Inc. operates a coast-to-coast rental fleet of more than 10,350 units. The sheer scale of this asset base requires substantial ongoing investment in maintenance, parts, and servicing to keep utilization high.

The investment level is high, too. Management reaffirmed 2025 guidance but noted they planned to invest more than previously expected in the rental fleet, resulting in net rental CapEx of approximately $250 million for the full year 2025. The Average Original Equipment Cost (OEC) on rent for Q3 2025 was over $1.26 billion, a 17% year-over-year increase, showing the asset base is growing to meet demand.

Labor Costs for Skilled Technicians and Customization Staff

The specialized nature of the equipment-like aerial devices, digger derricks, and hi-rail gear-demands highly skilled labor for maintenance, repair, and customization. While specific labor dollar amounts aren't broken out in the high-level summaries, management cited additional expenses related to workforce expansion as a factor influencing downward revisions to internal earnings targets for FY25. These skilled technicians and customization staff are key cost drivers, necessary to maintain the quality and readiness of the high-value rental fleet.

Here's a quick look at some of the key financial metrics impacting the cost side as of late 2025:

Cost/Debt Metric	Period/As Of Date	Amount (USD)
Total Revenue (Q3)	Three Months Ended Sept 30, 2025	$482.1 million
Gross Profit (Q3)	Three Months Ended Sept 30, 2025	$100.8 million
Adjusted Gross Profit (Q3)	Three Months Ended Sept 30, 2025	$155.5 million
Depreciation of Rental Equipment (TTM)	Twelve Months Ended March 31, 2025	($49) million
Total Debt Outstanding	As of September 30, 2025	$1,666.4 million
Net Leverage Ratio	As of September 30, 2025	4.53x
Average OEC on Rent	Q3 2025	Over $1.26 billion
Projected Net Rental CapEx	Full Year 2025 Guidance	Approximately $250 million

The company's focus on achieving that 3x net leverage target by the end of 2026 definitely means debt servicing costs will remain a primary focus area for cost management going forward. Finance: draft 13-week cash view by Friday.

Custom Truck One Source, Inc. (CTOS) - Canvas Business Model: Revenue Streams

You're looking at the core ways Custom Truck One Source, Inc. (CTOS) brings in money, which is really the engine of their whole operation. As of late 2025, their revenue streams are clearly segmented across equipment lifecycle management, from building and selling to renting and servicing. Honestly, the guidance for the full year shows a clear expectation for growth across the board, which is what we want to see.

The company reaffirms its consolidated revenue outlook for fiscal year 2025 to be between $1,970 million and $2,060 million. This range implies a consolidated revenue growth of between 9% and 14% over the prior year.

Here's the quick math on how that full-year 2025 guidance breaks down across the three main segments:

Revenue Stream	2025 Revenue Guidance (Lower End)	2025 Revenue Guidance (Upper End)	Implied Growth Rate (vs. 2024 Actuals)
Truck and Equipment Sales (TES)	$1,160 million	$1,210 million	10% - 15%
Equipment Rental Solutions (ERS)	$660 million	$690 million	10% - 15%
Aftermarket Parts and Services (APS)	$150 million	$160 million	1% - 7%

The Truck and Equipment Sales (TES) segment is the largest expected contributor to revenue. You should note that while they expect significant revenue growth, they anticipate landing at the lower end of this guidance range due to macroeconomic uncertainty and high interest rates affecting smaller customers' purchasing decisions. Still, robust demand from local and regional customers is a key driver.

The Equipment Rental Solutions (ERS) segment is expected to be a strong performer, with management guiding toward the higher end of its range, driven by sustained trends in what they call OEC on Rent (Original Equipment Cost on Rent). This segment is where the sales of used rental equipment live, which is a critical component of the ERS revenue stream, as it helps recycle capital and monetize assets at the end of their rental life.

For context on the revenue mix, looking at the first quarter of 2025, the total revenue of $422 million was composed of several parts, though this is a quarterly snapshot, not the full-year projection:

• Equipment Sales: $274 million
• Rental Revenue: $32 million (This is just the rental component, not including used sales)
• Parts and Services Revenue: $116 million

The Aftermarket Parts and Services (APS) segment has the tightest guidance range, suggesting more predictable, though slower, growth. This stream benefits from the large installed base of equipment in the field needing maintenance and parts.

The sales of used rental equipment are embedded within the ERS segment total, which is guided to $660 million to $690 million for the year. This activity is key because it directly impacts fleet turnover and the average OEC on rent metric, which management highlighted as a major driver for ERS performance. For example, in the third quarter of 2025, the average OEC on rent was over $1.26 billion, up from under $1.1 billion in Q3 2024, showing the growing asset base supporting rental revenue.

The ERS segment's revenue is further supported by strong utilization; average fleet utilization reached 79.3% in Q3 2025, the highest level in over two years. This high utilization directly supports both rental revenue and the eventual realization of value from used equipment sales.

Finance: draft 13-week cash view by Friday.