10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 ___________________________________

FORM 10-Q

___________________________________

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2018

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 1-14387

Commission File Number 1-13663

___________________________________ 

United Rentals, Inc.

United Rentals (North America), Inc.

(Exact Names of Registrants as Specified in Their Charters)

 ___________________________________

Delaware Delaware	06-1522496 86-0933835
(States of Incorporation)	(I.R.S. Employer Identification Nos.)
100 First Stamford Place, Suite 700 Stamford, Connecticut	06902
(Address of Principal Executive Offices)	(Zip Code)

Registrants’ Telephone Number, Including Area Code: (203) 622-3131

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    x  Yes    o  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	x	Accelerated Filer	o
Non-Accelerated Filer	o	Smaller Reporting Company	o
Emerging Growth Company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    o  Yes    x   No

As of October 15, 2018, there were 81,102,622 shares of United Rentals, Inc. common stock, $0.01 par value, outstanding. There is no market for the common stock of United Rentals (North America), Inc., all outstanding shares of which are owned by United Rentals, Inc.

This combined Form 10-Q is separately filed by (i) United Rentals, Inc. and (ii) United Rentals (North America), Inc. (which is a wholly owned subsidiary of United Rentals, Inc.). United Rentals (North America), Inc. meets the conditions set forth in General Instruction (H)(1)(a) and (b) of Form 10-Q and is therefore filing this report with the reduced disclosure format permitted by such instruction.

UNITED RENTALS, INC.

UNITED RENTALS (NORTH AMERICA), INC.

FORM 10-Q FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2018

INDEX

		Page
PART I	FINANCIAL INFORMATION
Item 1	Unaudited Condensed Consolidated Financial Statements	6
	United Rentals, Inc. Condensed Consolidated Balance Sheets as of September 30, 2018 (unaudited) and December 31, 2017	6
	United Rentals, Inc. Condensed Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2018 and 2017 (unaudited)	7
	United Rentals, Inc. Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2018 and 2017 (unaudited)	8
	United Rentals, Inc. Condensed Consolidated Statement of Stockholders’ Equity for the Nine Months Ended September 30, 2018 (unaudited)	9
	United Rentals, Inc. Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2018 and 2017 (unaudited)	10
	Notes to Unaudited Condensed Consolidated Financial Statements	11
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	40
Item 3	Quantitative and Qualitative Disclosures About Market Risk	53
Item 4	Controls and Procedures	54
PART II	OTHER INFORMATION
Item 1	Legal Proceedings	55
Item 1A	Risk Factors	55
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	55
Item 6	Exhibits	56
	Signatures	57

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,” “seek,” “on-track,” “plan,” “project,” “forecast,” “intend” or “anticipate,” or the negative thereof or comparable terminology, or by discussions of strategy or outlook. You are cautioned that our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected.

Factors that could cause actual results to differ materially from those projected include, but are not limited to, the following:

• the possibility that companies that we have acquired or may acquire, including NES Rentals Holdings II, Inc. (“NES”), Neff Corporation ("Neff"), BakerCorp International Holdings, Inc. (“BakerCorp”) and Vander Holding Corporation and its subsidiaries ("BlueLine"), could have undiscovered liabilities or involve other unexpected costs, may strain our management capabilities or may be difficult to integrate;

• the possibility that the proposed BlueLine acquisition will not close;

• the cyclical nature of our business, which is highly sensitive to North American construction and industrial activities; if construction or industrial activity decline, our revenues and, because many of our costs are fixed, our profitability may be adversely affected;

• our significant indebtedness (which totaled $10.1 billion at September 30, 2018) requires us to use a substantial portion of our cash flow for debt service and can constrain our flexibility in responding to unanticipated or adverse business conditions;

• inability to refinance our indebtedness on terms that are favorable to us, or at all;

• incurrence of additional debt, which could exacerbate the risks associated with our current level of indebtedness;

• noncompliance with financial or other covenants in our debt agreements, which could result in our lenders terminating the agreements and requiring us to repay outstanding borrowings;

• restrictive covenants and amount of borrowings permitted in our debt instruments, which can limit our financial and operational flexibility;

• overcapacity of fleet in the equipment rental industry;

• inability to benefit from government spending, including spending associated with infrastructure projects;

• fluctuations in the price of our common stock and inability to complete stock repurchases in the time frame and/or on the terms anticipated;

• rates we charge and time utilization we achieve being less than anticipated;

• inability to manage credit risk adequately or to collect on contracts with a large number of customers;

• inability to access the capital that our businesses or growth plans may require;

• incurrence of impairment charges;

• trends in oil and natural gas could adversely affect the demand for our services and products;

• the fact that our holding company structure requires us to depend in part on distributions from subsidiaries and such distributions could be limited by contractual or legal restrictions;

• increases in our loss reserves to address business operations or other claims and any claims that exceed our established levels of reserves;

• incurrence of additional expenses (including indemnification obligations) and other costs in connection with litigation, regulatory and investigatory matters;

• the outcome or other potential consequences of regulatory matters and commercial litigation;

• shortfalls in our insurance coverage;

• our charter provisions as well as provisions of certain debt agreements and our significant indebtedness may have the effect of making more difficult or otherwise discouraging, delaying or deterring a takeover or other change of control of us;

• turnover in our management team and inability to attract and retain key personnel;

• costs we incur being more than anticipated, and the inability to realize expected savings in the amounts or time frames planned;

• dependence on key suppliers to obtain equipment and other supplies for our business on acceptable terms;

• inability to sell our new or used fleet in the amounts, or at the prices, we expect;

• competition from existing and new competitors;

• risks related to security breaches, cybersecurity attacks and other significant disruptions in our information technology systems;

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• the costs of complying with environmental, safety and foreign law and regulations, as well as other risks associated with non-U.S. operations, including currency exchange risk;

• labor disputes, work stoppages or other labor difficulties, which may impact our productivity, and potential enactment of new legislation or other changes in law affecting our labor relations or operations generally;

• increases in our maintenance and replacement costs and/or decreases in the residual value of our equipment; and

• the effect of changes in tax law, such as the effect of the Tax Cuts and Jobs Act that was enacted on December 22, 2017.

For a more complete description of these and other possible risks and uncertainties, please refer to our Annual Report on Form 10-K for the year ended December 31, 2017, as well as to our subsequent filings with the SEC. Our forward-looking statements contained herein speak only as of the date hereof, and we make no commitment to update or publicly release any revisions to forward-looking statements in order to reflect new information or subsequent events, circumstances or changes in expectations.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

	September 30, 2018			December 31, 2017
	(unaudited)
ASSETS
Cash and cash equivalents	$	65		$	352
Accounts receivable, net of allowance for doubtful accounts of $77 at September 30, 2018 and $68 at December 31, 2017	1,438			1,233
Inventory	104			75
Prepaid expenses and other assets	85			112
Total current assets	1,692			1,772
Rental equipment, net	8,910			7,824
Property and equipment, net	529			467
Goodwill	4,313			4,082
Other intangible assets, net	895			875
Other long-term assets	15			10
Total assets	$	16,354		$	15,030
LIABILITIES AND STOCKHOLDERS’ EQUITY
Short-term debt and current maturities of long-term debt	$	896		$	723
Accounts payable	688			409
Accrued expenses and other liabilities	503			536
Total current liabilities	2,087			1,668
Long-term debt	9,182			8,717
Deferred taxes	1,628			1,419
Other long-term liabilities	123			120
Total liabilities	13,020			11,924
Common stock—$0.01 par value, 500,000,000 shares authorized, 112,874,448 and 81,537,040 shares issued and outstanding, respectively, at September 30, 2018 and 112,394,395 and 84,463,662 shares issued and outstanding, respectively, at December 31, 2017	1			1
Additional paid-in capital	2,380			2,356
Retained earnings	3,791			3,005
Treasury stock at cost—31,337,408 and 27,930,733 shares at September 30, 2018 and December 31, 2017, respectively	(2,660		)	(2,105		)
Accumulated other comprehensive loss	(178		)	(151		)
Total stockholders’ equity	3,334			3,106
Total liabilities and stockholders’ equity	$	16,354		$	15,030

See accompanying notes.

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UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(In millions, except per share amounts)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2018		2017			2018			2017
Revenues:
Equipment rentals	$	1,861	$	1,536		$	4,951		$	4,069
Sales of rental equipment	140		139			478			378
Sales of new equipment	54		40			140			126
Contractor supplies sales	24		21			66			60
Service and other revenues	37		30			106			86
Total revenues	2,116		1,766			5,741			4,719
Cost of revenues:
Cost of equipment rentals, excluding depreciation	671		557			1,883			1,556
Depreciation of rental equipment	343		290			988			804
Cost of rental equipment sales	83		84			282			225
Cost of new equipment sales	46		34			121			108
Cost of contractor supplies sales	15		14			43			42
Cost of service and other revenues	20		14			58			42
Total cost of revenues	1,178		993			3,375			2,777
Gross profit	938		773			2,366			1,942
Selling, general and administrative expenses	265		237			736			648
Merger related costs	11		16			14			32
Restructuring charge	9		9			15			28
Non-rental depreciation and amortization	75		63			213			189
Operating income	578		448			1,388			1,045
Interest expense, net	118		131			339			338
Other income, net	—		(5		)	(2		)	(5		)
Income before provision for income taxes	460		322			1,051			712
Provision for income taxes	127		123			265			263
Net income	$	333	$	199		$	786		$	449
Basic earnings per share	$	4.05	$	2.36		$	9.44		$	5.31
Diluted earnings per share	$	4.01	$	2.33		$	9.34		$	5.26

See accompanying notes.

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UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(In millions)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018			2017
Net income	$	333	$	199	$	786		$	449
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments	18		41		(28		)	75
Fixed price diesel swaps	—		1		1			—
Other comprehensive (loss) income	18		42		(27		)	75
Comprehensive income (1)	$	351	$	241	$	759		$	524

(1)There were no material reclassifications from accumulated other comprehensive loss reflected in other comprehensive income (loss) during 2018 or 2017. There is no tax impact related to the foreign currency translation adjustments, as the earnings are considered permanently reinvested. There were no material taxes associated with other comprehensive income (loss) during 2018 or 2017.

See accompanying notes.

8

UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (UNAUDITED)

(In millions)

	Common Stock									Treasury Stock
	Number of Shares (1)		Amount		Additional Paid-in Capital			Retained Earnings		Number of Shares	Amount			Accumulated Other Comprehensive Loss (2)
Balance at December 31, 2017	84		$	1	$	2,356		$	3,005	28	$	(2,105	)	$	(151	)
Net income								786
Foreign currency translation adjustments														(28		)
Fixed price diesel swaps														1
Stock compensation expense, net	1				73
Exercise of common stock options					2
Shares repurchased and retired					(51		)
Repurchase of common stock	(3	)								3	(555		)
Balance at September 30, 2018	82		$	1	$	2,380		$	3,791	31	$	(2,660	)	$	(178	)

(1)Common stock outstanding increased by less than 1 million net shares during the year ended December 31, 2017.

(2)The Accumulated Other Comprehensive Loss balance primarily reflects foreign currency translation adjustments.

See accompanying notes.

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UNITED RENTALS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(In millions)

	Nine Months Ended
	September 30,
	2018			2017
Cash Flows From Operating Activities:
Net income	$	786		$	449
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,201			993
Amortization of deferred financing costs and original issue discounts	9			6
Gain on sales of rental equipment	(196		)	(153		)
Gain on sales of non-rental equipment	(4		)	(4		)
Gain on insurance proceeds from damaged equipment	(18		)	(10		)
Stock compensation expense, net	73			64
Merger related costs	14			32
Restructuring charge	15			28
Loss on repurchase/redemption of debt securities and amendment of ABL facility	—			43
Increase in deferred taxes	190			97
Changes in operating assets and liabilities, net of amounts acquired:
Increase in accounts receivable	(131		)	(172		)
Increase in inventory	(23		)	(9		)
Decrease (increase) in prepaid expenses and other assets	31			(1		)
Increase in accounts payable	238			350
(Decrease) increase in accrued expenses and other liabilities	(62		)	43
Net cash provided by operating activities	2,123			1,756
Cash Flows From Investing Activities:
Purchases of rental equipment	(1,962		)	(1,485		)
Purchases of non-rental equipment	(134		)	(87		)
Proceeds from sales of rental equipment	478			378
Proceeds from sales of non-rental equipment	13			10
Insurance proceeds from damaged equipment	18			10
Purchases of other companies, net of cash acquired	(805		)	(1,063		)
Purchases of investments	(1		)	(5		)
Net cash used in investing activities	(2,393		)	(2,242		)
Cash Flows From Financing Activities:
Proceeds from debt	7,062			8,702
Payments of debt	(6,464		)	(8,156		)
Proceeds from the exercise of common stock options	2			1
Common stock repurchased	(606		)	(26		)
Payments of financing costs	(1		)	(44		)
Net cash (used in) provided by financing activities	(7		)	477
Effect of foreign exchange rates	(10		)	21
Net (decrease) increase in cash and cash equivalents	(287		)	12
Cash and cash equivalents at beginning of period	352			312
Cash and cash equivalents at end of period	$	65		$	324
Supplemental disclosure of cash flow information:
Cash paid for income taxes, net	$	50		$	114
Cash paid for interest	379			305

See accompanying notes.

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UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share data, unless otherwise indicated)

1. Organization, Description of Business and Basis of Presentation

United Rentals, Inc. (“Holdings,” “URI” or the “Company”) is principally a holding company and conducts its operations primarily through its wholly owned subsidiary, United Rentals (North America), Inc. (“URNA”), and subsidiaries of URNA. Holdings’ primary asset is its sole ownership of all issued and outstanding shares of common stock of URNA. URNA’s various credit agreements and debt instruments place restrictions on its ability to transfer funds to its shareholder.

We rent equipment to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities in the United States, Canada and Europe. In addition to renting equipment, we sell new and used rental equipment, as well as related contractor supplies, parts and service.

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the accounting policies described in our annual report on Form 10-K for the year ended December 31, 2017 (the “2017 Form 10-K”) and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the 2017 Form 10-K.

In our opinion, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented have been made. Interim results of operations are not necessarily indicative of the results of the full year.

New Accounting Pronouncements

Leases. In March 2016, the Financial Accounting Standards Board (“FASB”) issued guidance ("Topic 842") to increase transparency and comparability among organizations by requiring (1) recognition of lease assets and lease liabilities on the balance sheet and (2) disclosure of key information about leasing arrangements. Some changes to the lessor accounting guidance were made to align both of the following: (1) the lessor accounting guidance with certain changes made to the lessee accounting guidance and (2) key aspects of the lessor accounting model with revenue recognition guidance. Topic 842 will be effective for fiscal years and interim periods beginning after December 15, 2018, and early adoption is permitted. A modified retrospective approach is required for adoption for all leases that exist at or commence after the date of initial application with an option to use certain practical expedients. We expect to use the package of practical expedients that allows us to not reassess: (1) whether any expired or existing contracts are or contain leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. We additionally expect to use the practical expedient that allows us to treat the lease and non-lease components of our leases as a single component for our real estate leases. We expect to adopt this guidance when effective, using the transition method that allows us to initially apply Topic 842 at the adoption date of January 1, 2019 and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption.

As discussed in note 2 to our condensed consolidated financial statements, most of our equipment rental revenues, which accounted for 86 percent of total revenues for the nine months ended September 30, 2018, will be accounted for under the current lease accounting standard ("Topic 840") until the adoption of Topic 842. We have tentatively concluded that no significant changes are expected to the accounting for most of our equipment rental revenues upon adoption of Topic 842.

Under Topic 842, our operating leases, which include both real estate and non-rental equipment, will result in lease assets and lease liabilities being recognized on the balance sheet. We lease a significant portion of our branch locations, and also lease other premises used for purposes such as district and regional offices and service centers. We expect that the quantification of the amount of the lease assets and lease liabilities that we will recognize on our balance sheet will take a significant amount of time given the size of our lease portfolio. While our review of the lessee accounting requirements of Topic 842 is ongoing, we believe that the impact on our balance sheet, while not currently estimable, will be significant.

Measurement of Credit Losses on Financial Instruments. In June 2016, the FASB issued guidance that will require companies to present assets held at amortized cost and available for sale debt securities net of the amount expected to be collected. The guidance requires the measurement of expected credit losses to be based on relevant information from past events, including historical experiences, current conditions and reasonable and supportable forecasts that affect collectibility. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2019 and early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Different components of the guidance require modified retrospective or prospective adoption. We are currently assessing whether we will

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early adopt, and the impact on our financial statements is not currently estimable as it will depend on market conditions and our forecast expectations upon, and following, adoption.

Simplifying the Test for Goodwill Impairment. In January 2017, the FASB issued guidance intended to simplify the subsequent accounting for goodwill acquired in a business combination. Prior guidance required utilizing a two-step process to review goodwill for impairment. A second step was required if there was an indication that an impairment may exist, and the second step required calculating the potential impairment by comparing the implied fair value of the reporting unit's goodwill (as if purchase accounting were performed on the testing date) with the carrying amount of the goodwill. The new guidance eliminates the second step from the goodwill impairment test. Under the new guidance, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and then recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value (although the loss should not exceed the total amount of goodwill allocated to the reporting unit). The guidance requires prospective adoption and will be effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption of this guidance is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We are currently assessing whether we will early adopt. The guidance is not expected to have a significant impact on our financial statements.

Derivatives and Hedging. In August 2017, the FASB issued guidance with the objective of improving the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. The guidance is additionally intended to simplify hedge accounting, and no longer requires separate measurement and reporting of hedge ineffectiveness. For cash flow and net investment hedges existing at the date of adoption, entities must apply a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retained earnings. The amended presentation and disclosure guidance is required prospectively. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2018, and early adoption is permitted. We are currently assessing whether we will early adopt. Given our currently limited use of derivative instruments, the guidance is not expected to have a significant impact on our financial statements.

Guidance Adopted in 2018

Revenue from Contracts with Customers. See note 2 to our condensed consolidated financial statements for a discussion of our revenue recognition accounting following our adoption in the first quarter of 2018 of FASB guidance addressing the principles for recognizing revenue.

Statement of Cash Flows. In 2018, we retrospectively adopted guidance that was issued to reduce the diversity in the presentation of certain cash receipts and cash payments presented and classified in the statement of cash flows. The guidance addresses the following specific cash flow issues: (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (6) distributions received from equity method investees, (7) beneficial interests in securitization transitions and (8) separately identifiable cash flows and application of predominance principle. The adoption of this guidance did not have a significant impact on our financial statements for the three and nine months ended September 30, 2018 or 2017.

Intra-Entity Transfers of Assets Other Than Inventory. In 2018, we adopted guidance that requires companies to recognize the income tax effects of intra-entity sales and transfers of assets other than inventory in the period in which the transfer occurs. The adoption of this guidance did not have a significant impact on our financial statements.

Clarifying the Definition of a Business. In 2018, we adopted guidance that was issued to clarify the definition of a business with the objective of assisting entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is intended to make determining when a set of assets and activities is a business more consistent and cost-efficient. The future impact of this guidance will depend on the nature of our future activities, and fewer transactions may be treated as acquisitions (or disposals) of businesses after adoption.

Stock Compensation: Scope of Modification Accounting. In 2018, we prospectively adopted guidance that was issued to provide clarity and reduce both the (1) diversity in practice and (2) cost and complexity when changing the terms or conditions of share-based payment awards. Under the updated guidance, a modification is defined as a change in the terms or conditions of a share-based payment award, and an entity should account for the effects of a modification unless all of the following are met:

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1.The fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation techniques that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification.

2.The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified.

3.The classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.

The majority of our modifications relate to the acceleration of vesting conditions. The accounting for such modifications did not change under the adopted guidance, which did not have a significant impact on our financial statements.

Tax Cuts and Jobs Act

The Tax Cuts and Jobs Act (the "Tax Act") was enacted in December 2017. The Act reduced the U.S. federal corporate tax rate from 35 percent to 21 percent, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. As of December 31, 2017, we were able to determine a reasonable estimate of (1) the effects on our existing deferred tax balances and (2) the one-time transition tax. We recognized a provisional income tax benefit of $689 in the year ended December 31, 2017 associated with these items that we reasonably estimated. As of September 30, 2018, we have not changed the provisional estimate recognized in 2017 associated with the effects on our existing deferred tax balances. During the three and nine months ended September 30, 2018, we increased the estimated one-time transition tax by $6. The Tax Act subjects U.S. shareholders to a tax on global intangible low-taxed income (“GILTI”) earned by certain foreign subsidiaries. Entities can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred. Given the complexity of the GILTI provisions, we are still evaluating the tax impact and have not yet made the accounting policy election. As of September 30, 2018, we were able to reasonably estimate provisional adjustments, based on current year operations only, related to GILTI and recognized the immaterial adjustments in our financial statements. In all cases as it relates to the Tax Act, we will continue to refine our calculations as additional analysis is completed and as we gain a more thorough understanding of the tax law.

All amounts recognized associated with the Tax Act as of September 30, 2018 are provisional. Given the complexity of the Tax Act, we are still evaluating the tax impact. We expect to complete the accounting in the fourth quarter of 2018. As noted above, most of the impact of the Act was recognized in 2017, with $6 of additional expense recognized during the three and nine months ended September 30, 2018.

2. Revenue Recognition

Adoption of Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”

In May 2014, and in subsequent updates, the FASB issued guidance ("Topic 606") to clarify the principles for recognizing revenue. Topic 606 is an update to Topic 605, which was the revenue recognition standard in effect through December 31, 2017. Topic 606 includes the required steps to achieve the core principle that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted Topic 606 on January 1, 2018, using the modified retrospective method. The adoption of Topic 606 did not result in any significant changes to our historic revenue accounting under Topic 605. Results for 2018 are presented under Topic 606, while results for 2017 continue to reflect our historic accounting under Topic 605. Because there were no significant changes to our revenue recognition accounting upon adoption of Topic 606, no changes to our historic financial statements were required, and no cumulative change to retained earnings was required.

We applied the Topic 606 practical expedient that allows entities to not restate contracts that begin and are completed within the same annual reporting period. No other practical expedients associated with the adoption of Topic 606 were applied. The only change to our revenue accounting upon adoption of Topic 606 pertains to sales of certain rental equipment. Prior to the adoption of Topic 606, certain sales of rental equipment were deferred until certain contingent future events occurred. Under Topic 606, we are no longer required to defer the revenue. The adoption of Topic 606 results in earlier recognition (primarily in the first quarter) of certain sales of rental equipment, but it does not impact total annual revenue because the contingencies that previously resulted in deferral under Topic 605 are always resolved within the same calendar year. During the three months ended September 30, 2017, we recognized $139 of sales of rental equipment under Topic 605. Under Topic 606, sales of rental equipment during the three months ended September 30, 2017 would have been $14 less because such sales would have been recognized prior to the three months ended September 30, 2017. During the nine months ended September 30,

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2017, we recognized $378 of sales of rental equipment under Topic 605 and such amount does not differ materially from the amount that would have been recognized under Topic 606.

As discussed below, following the adoption of Topic 606, we recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840 (which addresses lease accounting. As discussed below, we expect to adopt an update to this standard on January 1, 2019). Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services.

As reflected below, most of our revenue is accounted for under Topic 840. Our contracts with customers generally do not include multiple performance obligations. For contracts with multiple Topic 606 performance obligations, we allocate revenue to each performance obligation using our best estimate of the standalone selling price for each performance obligation.

Nature of goods and services

In the following table, revenue is summarized by type and by the applicable accounting standard.

	Three Months Ended September 30,
			2018						2017
	Topic 840		Topic 606		Total		Topic 840		Topic 605		Total
Revenues:
Owned equipment rentals	$	1,589	$	—	$	1,589	$	1,320	$	—	$	1,320
Re-rent revenue	41		—		41		32		—		32
Ancillary and other rental revenues:
Delivery and pick-up	—		132		132		—		107		107
Other	78		21		99		61		16		77
Total ancillary and other rental revenues	78		153		231		61		123		184
Total equipment rentals	1,708		153		1,861		1,413		123		1,536
Sales of rental equipment	—		140		140		—		139		139
Sales of new equipment	—		54		54		—		40		40
Contractor supplies sales	—		24		24		—		21		21
Service and other revenues	—		37		37		—		30		30
Total revenues	$	1,708	$	408	$	2,116	$	1,413	$	353	$	1,766

	Nine Months Ended September 30,
			2018						2017
	Topic 840		Topic 606		Total		Topic 840		Topic 605		Total
Revenues:
Owned equipment rentals	$	4,260	$	—	$	4,260	$	3,508	$	—	$	3,508
Re-rent revenue	95		—		95		78		—		78
Ancillary and other rental revenues:
Delivery and pick-up	—		336		336		—		279		279
Other	198		62		260		160		44		204
Total ancillary and other rental revenues	198		398		596		160		323		483
Total equipment rentals	4,553		398		4,951		3,746		323		4,069
Sales of rental equipment	—		478		478		—		378		378
Sales of new equipment	—		140		140		—		126		126
Contractor supplies sales	—		66		66		—		60		60
Service and other revenues	—		106		106		—		86		86
Total revenues	$	4,553	$	1,188	$	5,741	$	3,746	$	973	$	4,719

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Revenues by reportable segment and geographical market are presented in notes 4 and 11 of the condensed consolidated financial statements, respectively, using the revenue captions reflected in our condensed consolidated statements of operations. The majority of our revenue is recognized in our general rentals segment and in the U.S. (for the nine months ended September 30, 2018, 82 percent and 92 percent of total revenues, respectively), and, accordingly, we do not believe that presenting the revenue types above by reportable segment or geographical market would provide information that is material to investors. We believe that the disaggregation of our revenue from contracts to customers as reflected above, coupled with the further discussion below and the reportable segment and geographical market disclosures in notes 4 and 11, depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Lease revenues (Topic 840)

The accounting for the types of revenue that are accounted for under Topic 840 is discussed below. As discussed in note 1 to the condensed consolidated financial statements, we expect to adopt Topic 842, which is an update to Topic 840, on January 1, 2019. We have tentatively concluded that no significant changes are expected to our revenue accounting upon adoption of Topic 842.

Owned equipment rentals: Owned equipment rentals represent revenues from renting equipment that we own. We account for such rentals as operating leases.

We recognize revenues from renting equipment on a straight-line basis. Our rental contract periods are hourly, daily, weekly or monthly. By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day. The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days. This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply.

As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, we will have customers return equipment and be contractually required to pay us more than the cumulative amount of revenue recognized to date under the straight-line methodology. For instance, continuing the above example, if the customer rented the above piece of equipment on December 29 and returned it at the close of business on January 1, we would recognize incremental revenue on January 1 of $171.44 (in actual dollars, representing the difference between the amount the customer is contractually required to pay, or $300 at the weekly rate, and the cumulative amount recognized to date on a straight-line basis, or $128.56, which represents four days at $32.14 per day).

We record amounts billed to customers in excess of recognizable revenue as deferred revenue on our balance sheet. We had deferred revenue (associated with both Topic 840 and Topic 606/605) of $58 and $46 as of September 30, 2018 and December 31, 2017, respectively.

Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above.

“Other” equipment rental revenue is primarily comprised of 1) Rental Protection Plan (or "RPP") revenue associated with the damage waiver customers can purchase when they rent our equipment to protect against potential loss or damage, 2) environmental charges associated with the rental of equipment, and 3) charges for rented equipment that is damaged by our customers.

Revenues from contracts with customers (Topic 606)

The accounting for the types of revenue that are accounted for under Topic 606 is discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time.

Delivery and pick-up: Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed.

“Other” equipment rental revenue is primarily comprised of revenues associated with the consumption of fuel by our customers which are recognized when the equipment is returned by the customer (and consumption, if any, can be measured).

Sales of rental equipment, new equipment and contractor supplies are recognized at the time of delivery to, or pick-up by, the customer and when collectibility is reasonably assured.

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Service and other revenues primarily represent revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). Service revenue is recognized as the services are performed.

Receivables and contract assets and liabilities

As reflected above, most of our equipment rental revenue is accounted for under Topic 840 (such revenue represented 79 percent of our total revenues for the nine months ended September 30, 2018). The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. Because the same customers generate the revenues that are accounted for under both Topic 606 and Topic 840, the discussions below on credit risk and our allowances for doubtful accounts address our total revenues from Topic 606 (Topic 605 for 2017) and Topic 840.

Concentration of credit risk with respect to our receivables is limited because a large number of geographically diverse customers makes up our customer base. Our largest customer accounted for less than one percent of total revenues for the nine months ended September 30, 2018, and for each of the last three full years. Our customer with the largest receivable balance represented approximately one percent of total receivables at September 30, 2018 and December 31, 2017. We manage credit risk through credit approvals, credit limits and other monitoring procedures.

We maintain allowances for doubtful accounts. These allowances reflect our estimate of the amount of our receivables that we will be unable to collect based on historical write-off experience. Our estimate could require change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowances. Trade receivables that have contractual maturities of one year or less are written-off when they are determined to be uncollectible based on the criteria necessary to qualify as a deduction for federal tax purposes. Write-offs of such receivables require management approval based on specified dollar thresholds. During the nine months ended September 30, 2018 and 2017, we recognized expenses of $27 and $24, respectively, primarily within selling, general and administrative expenses in our condensed consolidated statements of income, associated with our allowances for doubtful accounts.

We do not have material contract assets, or impairment losses associated therewith, or material contract liabilities, associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenue during the three or nine months ended September 30, 2018 or 2017 that was included in the contract liability balance as of the beginning of such periods.

Performance obligations

Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the three and nine months ended September 30, 2018 and 2017 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2018.

Payment terms

Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk.

Sales tax amounts collected from customers are recorded on a net basis.

Contract costs

We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.

Contract estimates and judgments

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Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments, primarily for the following reasons:

• The transaction price is generally fixed and stated on our contracts;

• As noted above, our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation;

• Our revenues do not include material amounts of variable consideration; and

• Most of our revenue is recognized as of a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenue is generally recognized at the time of delivery to, or pick-up by, the customer.

We monitor and review our estimated standalone selling prices on a regular basis.

3. Acquisitions

NES Acquisition

In April 2017, we completed the acquisition of NES Rentals Holdings II, Inc. (“NES”). NES was a provider of rental equipment with 73 branches located throughout the eastern half of the U.S., and had approximately 1,100 employees and approximately $900 of rental assets at original equipment cost as of December 31, 2016. NES had annual revenues of approximately $369. The acquisition:

•Increased our density in strategically important markets, including the East Coast, Gulf States and the Midwest;

•Strengthened our relationships with local and strategic accounts in the construction and industrial sectors, which enhances cross-selling opportunities and drives revenue synergies; and

•Created meaningful opportunities for cost synergies in areas such as corporate overhead, operational efficiencies and purchasing.

The aggregate consideration paid to holders of NES common stock and options was approximately $960. The acquisition and related fees and expenses were funded through drawings on our senior secured asset-based revolving credit facility (“ABL facility”) and new debt issuances. 

The following table summarizes the fair values of the assets acquired and liabilities assumed.

Accounts receivable, net of allowance for doubtful accounts (1)	$	49
Inventory	4
Rental equipment	571
Property and equipment	48
Intangibles (2)	139
Other assets	7
Total identifiable assets acquired	818
Short-term debt and current maturities of long-term debt (3)	(3		)
Current liabilities	(33		)
Deferred taxes	(15		)
Long-term debt (3)	(11		)
Other long-term liabilities	(5		)
Total liabilities assumed	(67		)
Net identifiable assets acquired	751
Goodwill (4)	209
Net assets acquired	$	960

(1) The fair value of accounts receivables acquired was $49, and the gross contractual amount was $53. We estimated that $4 would be uncollectible.

17

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

(2) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	138	10
Non-compete agreements	1		1
Total	$	139

(3) The acquired debt reflects capital lease obligations.

(4) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of NES's going-concern value, the value of NES's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $1 of goodwill is expected to be deductible for income tax purposes.

The nine months ended September 30, 2018 and 2017 include NES acquisition-related costs which are included in “Merger related costs” in our condensed consolidated statements of income. In addition to the acquisition-related costs reflected in our condensed consolidated statements of income, the debt issuance costs and the original issue premiums associated with the issuance of debt to fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our condensed consolidated balance sheets.

Since the acquisition date, significant amounts of fleet have been moved between URI locations and the acquired NES locations, and it is not practicable to reasonably estimate the amounts of revenue and earnings of NES since the acquisition date. The impact of the NES acquisition on our equipment rentals revenue is primarily reflected in the increase in the volume of OEC on rent of 19.6 percent for the nine months ended September 30, 2018 (such increase also includes the impact of the acquisitions of Neff Corporation ("Neff") and BakerCorp International Holdings, Inc. (“BakerCorp”) discussed below).

Neff Acquisition

In October 2017, we completed the acquisition of Neff. Neff was a provider of earthmoving, material handling, aerial and other equipment, and had 69 branches located in 14 states, with a concentration in southern geographies. Neff had approximately 1,100 employees and approximately $860 of rental assets at original equipment cost as of September 30, 2017. Neff had annual revenues of approximately $413. The acquisition augmented our earthmoving capabilities and efficiencies of scale in key market areas, particularly fast-growing southern geographies, and created opportunities for revenue synergies through the cross-selling of our broader fleet.

The aggregate consideration paid to holders of Neff common stock and options was approximately $1.316 billion (including $7 of stock consideration associated with Neff stock options and restricted stock units which were converted into United Rentals stock options). The acquisition and related fees and expenses were primarily funded through new debt issuances. 

The following table summarizes the fair values of the assets acquired and liabilities assumed.

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UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

Accounts receivable, net of allowance for doubtful accounts (1)	$	72
Inventory	5
Rental equipment	550
Property and equipment	45
Intangibles (customer relationships) (2)	153
Other assets	5
Total identifiable assets acquired	830
Current liabilities	(62		)
Deferred taxes	(36		)
Other long-term liabilities	(3		)
Total liabilities assumed	(101		)
Net identifiable assets acquired	729
Goodwill (3)	587
Net assets acquired	$	1,316

(1) The fair value of accounts receivables acquired was $72, and the gross contractual amount was $74. We estimated that $2 would be uncollectible.

(2) The customer relationships are being amortized over a 10 year life.

(3) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of Neff's going-concern value, the value of Neff's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $320 of goodwill is expected to be deductible for income tax purposes.

The three and nine months ended September 30, 2018 and 2017 include Neff acquisition-related costs which are included in “Merger related costs” in our condensed consolidated statements of income. In addition to the acquisition-related costs reflected in our consolidated statements of income, the debt issuance costs and the original issue premiums associated with the issuance of debt to fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our condensed consolidated balance sheets.

Since the acquisition date, significant amounts of fleet have been moved between URI locations and the acquired Neff locations, and it is not practicable to reasonably estimate the amounts of revenue and earnings of Neff since the acquisition date. The impact of the Neff acquisition on our equipment rentals revenue is primarily reflected in the increases in the volume of OEC on rent of 17.8 percent and 19.6 percent for the three and nine months ended September 30, 2018, respectively. Such increase for the three months ended September 30, 2018 includes the impact of the acquisition of BakerCorp discussed below. Such increase for the nine months ended September 30, 2018 includes the impact of the acquisitions of NES discussed above and BakerCorp discussed below.

BakerCorp Acquisition

In July 2018, we completed the acquisition of BakerCorp. BakerCorp was a leading multinational provider of tank, pump, filtration and trench shoring rental solutions for a broad range of industrial and construction applications. BakerCorp had approximately 950 employees, and its operations were primarily concentrated in the United States and Canada, where it had 46 locations. BakerCorp also had 11 locations in France, Germany, the United Kingdom and the Netherlands. BakerCorp had annual revenues of approximately $295. The acquisition is expected to:

•Augment our bundled solutions for fluid storage, transfer and treatment;

•Expand our strategic account base; and

•Provide a significant opportunity to increase revenue and enhance customer service by cross-selling to our broader customer base.

The aggregate consideration paid was approximately $724. The acquisition and related fees and expenses were funded through drawings on our ABL facility.

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UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

The following table summarizes the fair values of the assets acquired and liabilities assumed. The purchase price allocations for these assets and liabilities are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period.

Accounts receivable, net of allowance for doubtful accounts (1)	$	73
Inventory	5
Rental equipment	352
Property and equipment	27
Intangibles (2)	149
Other assets	5
Total identifiable assets acquired	611
Current liabilities	(61		)
Deferred taxes	(20		)
Total liabilities assumed	(81		)
Net identifiable assets acquired	530
Goodwill (3)	194
Net assets acquired	$	724

(1) The fair value of accounts receivables acquired was $73, and the gross contractual amount was $79. We estimated that $6 would be uncollectible.

(2) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	144	8
Trade names and associated trademarks	5		5
Total	$	149

(3) All of the goodwill was assigned to our trench, power and fluid solutions segment. The level of goodwill that resulted from the acquisition is primarily reflective of BakerCorp's going-concern value, the value of BakerCorp's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that are not associated with the identifiable assets. $7 of goodwill is expected to be deductible for income tax purposes.

The three and nine months ended September 30, 2018 include BakerCorp acquisition-related costs which are included in “Merger related costs” in our condensed consolidated statements of income.

Since the acquisition date, significant amounts of fleet have been moved between URI locations and the acquired BakerCorp locations, and it is not practicable to reasonably estimate the amounts of revenue and earnings of BakerCorp since the acquisition date. The impact of the BakerCorp acquisition on our equipment rentals revenue is primarily reflected in the increases in the volume of OEC on rent of 17.8 percent and 19.6 percent for the three and nine months ended September 30, 2018, respectively. Such increase for the three months ended September 30, 2018 includes the impact of the acquisition of Neff discussed above. Such increase for the nine months ended September 30, 2018 includes the impact of the acquisitions of NES and Neff discussed above.

Pro forma financial information

The pro forma information below gives effect to the NES, Neff and BakerCorp acquisitions as if they had been completed on January 1, 2017 (“the pro forma acquisition date”). The pro forma information is not necessarily indicative of our results of operations had the acquisitions been completed on the above date, nor is it necessarily indicative of our future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, and also does not reflect additional revenue opportunities following the acquisitions. The pro forma information includes adjustments to record the assets and liabilities of NES, Neff and BakerCorp at their respective fair values based on available information and to give effect to the financing for the acquisitions and related transactions. The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed. The acquisition measurement periods for

20

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

NES and Neff have ended and the values assigned to the NES and Neff assets acquired and liabilities assumed are final. The opening balance sheet values assigned to the BakerCorp assets acquired and liabilities assumed are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact our statements of income in future periods. The tables below present unaudited pro forma consolidated income statement information as if NES, Neff and BakerCorp had been included in our consolidated results for the entire periods reflected. NES and Neff are excluded from the 2018 table because they are included in our results for the entire nine months ended September 30, 2018.

	Three Months Ended													Nine Months Ended
	September 30, 2017													September 30, 2017
	United Rentals		NES		Neff			BakerCorp			Total			United Rentals		NES			Neff			BakerCorp			Total
Historic/pro forma revenues	$	1,766	$	—	$	111		$	70		$	1,947		$	4,719	$	81		$	312		$	199		$	5,311
Historic/combined pretax income (loss)	322		—		16			(6		)	332			712		(12		)	38			(62		)	676
Pro forma adjustments to pretax income (loss):
Impact of fair value mark-ups/useful life changes on depreciation (1)			—		(3		)	(4		)	(7		)			(9		)	(8		)	(10		)	(27		)
Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales (2)			—		—			—			—					(1		)	(1		)	—			(2		)
Intangible asset amortization (3)			—		(7		)	(8		)	(15		)			(6		)	(21		)	(25		)	(52		)
Goodwill impairment (4)			—		—			—			—					—			—			32			32
Interest expense (5)			—		(17		)	(5		)	(22		)			(9		)	(51		)	(14		)	(74		)
Elimination of historic interest (6)			—		11			10			21					12			34			30			76
Elimination of merger related costs (7)			1		15			—			16					17			15			—			32
Restructuring charges (8)			4		(3		)	—			1					(5		)	(19		)	(6		)	(30		)
Pro forma pretax income											$	326													$	631

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UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

	Three Months Ended								Nine Months Ended
	September 30, 2018								September 30, 2018
	United Rentals		BakerCorp			Total			United Rentals		BakerCorp			Total
Historic/pro forma revenues	$	2,116	$	28		$	2,144		$	5,741	$	184		$	5,925
Historic/combined pretax income (loss)	460		(63		)	397			1,051		(84		)	967
Pro forma adjustments to pretax income (loss):
Impact of fair value mark-ups/useful life changes on depreciation (1)			(1		)	(1		)			(8		)	(8		)
Intangible asset amortization (3)			(1		)	(1		)			(16		)	(16		)
Interest expense (5)			(2		)	(2		)			(14		)	(14		)
Elimination of historic interest (6)			9			9					30			30
Elimination of merger related costs (7)			65			65					66			66
Restructuring charges (8)			6			6					6			6
Pro forma pretax income						$	473							$	1,031

(1) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups, and the changes in useful lives and salvage values, of the equipment acquired in the NES, Neff and BakerCorp acquisitions.

(2) Cost of rental equipment sales was adjusted for the fair value mark-ups of rental equipment acquired in the NES and Neff acquisitions. BakerCorp did not historically recognize a material amount of rental equipment sales, and accordingly no adjustment was required for BakerCorp.

(3) The intangible assets acquired in the NES, Neff and BakerCorp acquisitions were amortized.

(4) The goodwill impairment charge that BakerCorp recognized during the nine months ended September 30, 2017 was eliminated. If the acquisition had occurred as of the pro forma acquisition date, this impairment charge would not have been recognized (instead, we would have tested for goodwill impairment based on the post-acquisition reporting unit structure).

(5) As discussed above, we issued debt to partially fund the NES, Neff and BakerCorp acquisitions. Interest expense was adjusted to reflect these changes in our debt portfolio.

(6) Historic interest on debt that is not part of the combined entity was eliminated.

(7) Merger related costs primarily comprised of financial and legal advisory fees associated with the NES, Neff and BakerCorp acquisitions were eliminated as they were assumed to have been recognized prior to the pro forma acquisition date. The adjustments for BakerCorp for the three and nine months ended September 30, 2018 include $57 of merger related costs recognized by BakerCorp prior to the acquisition.

(8) We expect to recognize restructuring charges primarily comprised of severance costs and branch closure charges associated with the acquisitions over a period of approximately one year following the acquisition dates, which, for the pro forma presentation, was January 1, 2017. The adjustments above reflect the timing of the actual restructuring charges following the acquisitions (the pro forma restructuring charges above for the three and nine months ended September 30, 2017 reflect the actual restructuring charges recognized during the three and nine months following the acquisitions). We do not expect to incur significant additional restructuring charges for NES and Neff. We expect to incur additional restructuring charges for BakerCorp, however the remaining costs are not currently estimable, as we are still identifying the actions that will be undertaken.

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UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

4. Segment Information

Following the acquisition of BakerCorp discussed in note 3 to the condensed consolidated financial statements, we changed the name of our former “trench, power and pump” segment to “trench, power and fluid solutions”. The locations acquired in the BakerCorp acquisition are in our Fluid Solutions (before the acquisition, “Pump Solutions”) and Fluid Solutions Europe regions, both of which are in the trench, power and fluid solutions segment. The changes to the region and segment names reflect a broader product offering following the BakerCorp acquisition.

Our reportable segments are i) general rentals and ii) trench, power and fluid solutions. The general rentals segment includes the rental of i) general construction and industrial equipment, such as backhoes, skid-steer loaders, forklifts, earthmoving equipment and material handling equipment, ii) aerial work platforms, such as boom lifts and scissor lifts and iii) general tools and light equipment, such as pressure washers, water pumps and power tools. The general rentals segment reflects the aggregation of 11 geographic regions—Carolinas, Gulf South, Industrial (which serves the geographic Gulf region and has a strong industrial presence), Mid-Atlantic, Mid Central, Midwest, Northeast, Pacific West, South, Southeast and Western Canada—and operates throughout the United States and Canada.

The trench, power and fluid solutions segment includes the rental of specialty construction products such as i) trench safety equipment, such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, ii) power and HVAC equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment and iii) fluid solutions equipment primarily used for fluid storage, transfer and treatment. The trench, power and fluid solutions segment is comprised of the following regions, each of which primarily rents the corresponding equipment type described above: i) the Trench Safety region, ii) the Power and HVAC region, iii) the Fluid Solutions region and iv) the Fluid Solutions Europe region. The trench, power and fluid solutions segment’s customers include construction companies involved in infrastructure projects, municipalities and industrial companies. This segment operates throughout the United States and in Canada and Europe.

These segments align our external segment reporting with how management evaluates and allocates resources. We evaluate segment performance based on segment equipment rentals gross profit.

The following tables set forth financial information by segment.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

	General rentals		Trench, power and fluid solutions		Total
Three Months Ended September 30, 2018
Equipment rentals	$	1,444	$	417	$	1,861
Sales of rental equipment	130		10		140
Sales of new equipment	50		4		54
Contractor supplies sales	17		7		24
Service and other revenues	33		4		37
Total revenue	1,674		442		2,116
Depreciation and amortization expense	351		67		418
Equipment rentals gross profit	629		218		847
Three Months Ended September 30, 2017
Equipment rentals	$	1,237	$	299	$	1,536
Sales of rental equipment	130		9		139
Sales of new equipment	34		6		40
Contractor supplies sales	17		4		21
Service and other revenues	26		4		30
Total revenue	1,444		322		1,766
Depreciation and amortization expense	306		47		353
Equipment rentals gross profit	525		164		689
Nine Months Ended September 30, 2018
Equipment rentals	$	3,977	$	974	$	4,951
Sales of rental equipment	446		32		478
Sales of new equipment	125		15		140
Contractor supplies sales	50		16		66
Service and other revenues	95		11		106
Total revenue	4,693		1,048		5,741
Depreciation and amortization expense	1,022		179		1,201
Equipment rentals gross profit	1,598		482		2,080
Capital expenditures	1,845		251		2,096
Nine Months Ended September 30, 2017
Equipment rentals	$	3,357	$	712	$	4,069
Sales of rental equipment	348		30		378
Sales of new equipment	112		14		126
Contractor supplies sales	49		11		60
Service and other revenues	76		10		86
Total revenue	3,942		777		4,719
Depreciation and amortization expense	855		138		993
Equipment rentals gross profit	1,350		359		1,709
Capital expenditures	1,404		168		1,572

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

	September 30, 2018		December 31, 2017
Total reportable segment assets
General rentals	$	13,766	$	13,351
Trench, power and fluid solutions (1)	2,588		1,679
Total assets	$	16,354	$	15,030

(1) The increase in the trench, power and fluid solutions assets primarily reflects the impact of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements.

Equipment rentals gross profit is the primary measure management reviews to make operating decisions and assess segment performance. The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2018			2017			2018			2017
Total equipment rentals gross profit	$	847		$	689		$	2,080		$	1,709
Gross profit from other lines of business	91			84			286			233
Selling, general and administrative expenses	(265		)	(237		)	(736		)	(648		)
Merger related costs	(11		)	(16		)	(14		)	(32		)
Restructuring charge	(9		)	(9		)	(15		)	(28		)
Non-rental depreciation and amortization	(75		)	(63		)	(213		)	(189		)
Interest expense, net	(118		)	(131		)	(339		)	(338		)
Other income, net	—			5			2			5
Income before provision for income taxes	$	460		$	322		$	1,051		$	712

5. Restructuring Charges

Restructuring Charges

Restructuring charges primarily include severance costs associated with headcount reductions, as well as branch closure charges which principally relate to continuing lease obligations at vacant facilities. We incur severance costs and branch closure charges in the ordinary course of our business. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed three restructuring programs and have incurred total restructuring charges of $299.

Closed Restructuring Programs

We have three closed restructuring programs. The first was initiated in 2008 in recognition of a challenging economic environment and was completed in 2011. The second was initiated following the April 30, 2012 acquisition of RSC Holdings Inc. ("RSC"), and was completed in 2013. The third was initiated in the fourth quarter of 2015 in response to challenges in our operating environment. In particular, during 2015, we experienced volume and pricing pressure in our general rental business and our Fluid Solutions region associated with upstream oil and gas customers. Additionally, our Lean initiatives did not fully generate the anticipated cost savings due to lower than expected growth. In 2016, we achieved the anticipated run rate savings from the Lean initiatives, and this restructuring program was completed in 2016.

NES/Neff/Project XL Restructuring Program

In the second quarter of 2017, we initiated a restructuring program following the closing of the NES acquisition discussed in note 3 to the condensed consolidated financial statements. The restructuring program also includes actions undertaken associated with Project XL, which is a set of eight specific work streams focused on driving profitable growth through revenue opportunities and generating incremental profitability through cost savings across our business, and the Neff acquisition that is

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

discussed in note 3 to the condensed consolidated financial statements. We expect to complete the restructuring program in 2018, and do not expect to incur significant additional expenses in connection with the program.

BakerCorp Restructuring Program

In the third quarter of 2018, we initiated a restructuring program following the closing of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements. We expect to complete the restructuring program in 2019. The total costs expected to be incurred in connection with the program are not currently estimable, as we are still identifying the actions that will be undertaken.

The table below provides certain information concerning restructuring activity during the nine months ended September 30, 2018:

	Reserve Balance at		Charged to Costs and Expenses (1)		Payments and Other			Reserve Balance at
	December 31, 2017							September 30, 2018
Closed Restructuring Programs
Branch closure charges	$	13	$	1	$	(4	)	$	10
Severance and other	—		—		—			—
Total	$	13	$	1	$	(4	)	$	10
NES/Neff/Project XL Restructuring Program
Branch closure charges	$	8	$	1	$	(5	)	$	4
Severance and other	12		7		(11		)	8
Total	$	20	$	8	$	(16	)	$	12
BakerCorp Restructuring Program
Branch closure charges	$	—	$	—	$	—		$	—
Severance and other	—		6		(2		)	4
Total	$	—	$	6	$	(2	)	$	4
Total
Branch closure charges	$	21	$	2	$	(9	)	$	14
Severance and other	12		13		(13		)	12
Total	$	33	$	15	$	(22	)	$	26

_________________

(1)    Reflected in our condensed consolidated statements of income as “Restructuring charge.” These charges are not allocated to our reportable segments.

6. Goodwill and Other Intangible Assets

The following table presents the changes in the carrying amount of goodwill for the nine months ended September 30, 2018:

	General rentals			Trench, power and fluid solutions			Total
Balance at January 1, 2018 (1)	$	3,607		$	475		$	4,082
Goodwill related to acquisitions (2)	44			194			238
Foreign currency translation and other adjustments	(6		)	(1		)	(7		)
Balance at September 30, 2018 (1)	3,645			668			4,313

_________________

(1) The total carrying amount of goodwill for all periods in the table above is reflected net of $1.557 billion of accumulated impairment charges, which were primarily recorded in our general rentals segment.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

(2) For additional detail on the July 2018 acquisition of BakerCorp, which accounted for most of the goodwill related to acquisitions, see note 3 to our condensed consolidated financial statements.

Other intangible assets were comprised of the following at September 30, 2018 and December 31, 2017:

	September 30, 2018
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	28 months		$	23		$	17		$	6
Customer relationships	8 years		$	1,897		$	1,013		$	884
Trade names and associated trademarks	5 years		$	5		$	—		$	5

	December 31, 2017
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	31 months		$	71		$	62		$	9
Customer relationships	9 years		$	1,750		$	884		$	866

Our other intangibles assets, net at September 30, 2018 include the following assets associated with the acquisition of BakerCorp discussed in note 3 to our condensed consolidated financial statements. No residual value has been assigned to these assets which are being amortized using the sum of the years' digits method, which we believe best reflects the estimated pattern in which the economic benefits will be consumed.

	September 30, 2018
	Weighted-Average Remaining Amortization Period	Net Carrying Amount
Customer relationships	8 years	$	138
Trade names and associated trademarks	5 years	$	5

Amortization expense for other intangible assets was $52 and $41 for the three months ended September 30, 2018 and 2017, respectively, and $145 and $125 for the nine months ended September 30, 2018 and 2017, respectively.

As of September 30, 2018, estimated amortization expense for other intangible assets for each of the next five years and thereafter is as follows:  

2018		$	52
2019	193
2020	167
2021	141
2022	114
Thereafter	228
Total		$	895

7. Fair Value Measurements

As of September 30, 2018 and December 31, 2017, the amounts of our assets and liabilities that were accounted for at fair value were immaterial.

Fair value measurements are categorized in one of the following three levels based on the lowest level input that is significant to the fair value measurement in its entirety:

Level 1- Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2- Observable inputs other than quoted prices in active markets for identical assets or liabilities include:

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UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

a) quoted prices for similar assets or liabilities in active markets;

b) quoted prices for identical or similar assets or liabilities in inactive markets;

c) inputs other than quoted prices that are observable for the asset or liability;

d) inputs that are derived principally from or corroborated by observable market data by correlation or other means.

If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3- Inputs to the valuation methodology are unobservable (i.e., supported by little or no market activity) and significant to the fair value measure.

Fair Value of Financial Instruments

The carrying amounts reported in our condensed consolidated balance sheets for accounts receivable, accounts payable and accrued expenses and other liabilities approximate fair value due to the immediate to short-term maturity of these financial instruments. The fair values of our ABL facility, accounts receivable securitization facility and capital leases approximated their book values as of September 30, 2018 and December 31, 2017. The estimated fair values of our financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of September 30, 2018 and December 31, 2017 have been calculated based upon available market information, and were as follows:

	September 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Senior notes	$	7,014	$	7,006	$	7,008	$	7,340

8. Debt

Debt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following:

	September 30, 2018			December 31, 2017
Accounts Receivable Securitization Facility expiring 2018 (1)	$	865		$	695
$3.0 billion ABL Facility expiring 2021 (2)	2,120			1,670
4 5/8 percent Senior Secured Notes due 2023	993			992
5 3/4 percent Senior Notes due 2024	842			841
5 1/2 percent Senior Notes due 2025	794			793
4 5/8 percent Senior Notes due 2025	741			740
5 7/8 percent Senior Notes due 2026	999			998
5 1/2 percent Senior Notes due 2027	991			990
4 7/8 percent Senior Notes due 2028 (3)	1,650			1,648
4 7/8 percent Senior Notes due 2028 (3)	4			6
Capital leases	79			67
Total debt	10,078			9,440
Less short-term portion (4)	(896		)	(723		)
Total long-term debt	$	9,182		$	8,717

 ___________________

(1) In June 2018, the accounts receivable securitization facility was amended, primarily to increase the facility size and to extend the maturity date which may be further extended on a 364-day basis by mutual agreement with the purchasers under the facility. The size of the facility, which expires on June 29, 2019, was increased to $875.At September 30, 2018,

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

$9 was available under our accounts receivable securitization facility. The interest rate applicable to the accounts receivable securitization facility was 3.0 percent at September 30, 2018. During the nine months ended September 30, 2018, the monthly average principal amount outstanding under the accounts receivable securitization facility was $788, and the weighted-average interest rate thereon was 2.8 percent. The maximum month-end principal amount outstanding under the accounts receivable securitization facility during the nine months ended September 30, 2018 was $870. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of September 30, 2018, there were $1.024 billion of receivables, net of applicable reserves and other deductions, in the collateral pool.

(2) At September 30, 2018, $836 was available under our ABL facility, net of $37 of letters of credit. The interest rate applicable to the ABL facility was 3.7 percent at September 30, 2018. During the nine months ended September 30, 2018, the monthly average principal amount outstanding under the ABL facility was $1.485 billion, and the weighted-average interest rate thereon was 3.4 percent. The maximum month-end principal amount outstanding under the ABL facility during the nine months ended September 30, 2018 was $2.127 billion.

(3) URNA separately issued 4 ⁷/₈ percent Senior Notes in August 2017 and in September 2017. Following the issuances, we consummated an exchange offer pursuant to which most of the 4 ⁷/₈ percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 ⁷/₈ percent Senior Notes issued in August 2017.

(4) As of September 30, 2018, our short-term debt primarily reflects $865 of borrowings under our accounts receivable securitization facility.

Loan Covenants and Compliance

As of September 30, 2018, we were in compliance with the covenants and other provisions of the ABL facility, the accounts receivable securitization facility and the senior notes. Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations.

The only financial maintenance covenant that currently exists under the ABL facility is the fixed charge coverage ratio. Subject to certain limited exceptions specified in the ABL facility, the fixed charge coverage ratio covenant under the ABL facility will only apply in the future if specified availability under the ABL facility falls below 10 percent of the maximum revolver amount under the ABL facility. When certain conditions are met, cash and cash equivalents and borrowing base collateral in excess of the ABL facility size may be included when calculating specified availability under the ABL facility. As of September 30, 2018, specified availability under the ABL facility exceeded the required threshold and, as a result, this financial maintenance covenant was inapplicable. Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to: (i) the default ratio, (ii) the delinquency ratio, (iii) the dilution ratio and (iv) days sales outstanding. The accounts receivable securitization facility also requires us to comply with the fixed charge coverage ratio under the ABL facility, to the extent the ratio is applicable under the ABL facility.

9. Legal and Regulatory Matters

We are subject to a number of claims and proceedings that generally arise in the ordinary course of our business. These matters include, but are not limited to, general liability claims (including personal injury, property and auto claims), indemnification and guarantee obligations, employee injuries and employment-related claims, self-insurance obligations, contract and real estate matters, and other general business litigation. Based on advice of counsel and available information, including current status or stage of proceeding, and taking into account accruals for matters where we have established them, we currently believe that any liabilities ultimately resulting from such claims and proceedings will not, individually or in the aggregate, have a material adverse effect on our consolidated financial condition, results of operations or cash flows.

10. Earnings Per Share

Basic earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares plus the effect of dilutive potential common shares outstanding during the period. Net income and earnings per share for 2018 reflect lower effective tax rates due to the enactment of the Tax Act in December 2017, as discussed further below (see "Management’s Discussion and Analysis of Financial Condition and Results of Operations-Results of Operations-Other costs/(income)"). The following table sets forth the

29

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

computation of basic and diluted earnings per share (shares in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Numerator:
Net income available to common stockholders	$	333	$	199	786		449
Denominator:
Denominator for basic earnings per share—weighted-average common shares	82,344		84,663		83,345		84,585
Effect of dilutive securities:
Employee stock options	372		398		389		401
Restricted stock units	456		531		477		488
Denominator for diluted earnings per share—adjusted weighted-average common shares	83,172		85,592		84,211		85,474
Basic earnings per share	$	4.05	$	2.36	$	9.44	$	5.31
Diluted earnings per share	$	4.01	$	2.33	$	9.34	$	5.26

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

11. Condensed Consolidating Financial Information of Guarantor Subsidiaries

URNA is 100 percent owned by Holdings (“Parent”) and has certain outstanding indebtedness that is guaranteed by both Parent and, with the exception of its U.S. special purpose vehicle which holds receivable assets relating to the Company’s accounts receivable securitization facility (the “SPV”) and United Rentals International Management LLC, which is an immaterial subsidiary, all of URNA’s U.S. subsidiaries (the “guarantor subsidiaries”). Other than the guarantee by certain Canadian subsidiaries of URNA's indebtedness under the ABL facility, none of URNA’s indebtedness is guaranteed by URNA's foreign subsidiaries, the SPV or United Rentals International Management LLC (together, the “non-guarantor subsidiaries”). The SPV and United Rentals International Management LLC are presented together in the “Domestic” columns in the tables below. The receivable assets owned by the SPV have been sold or contributed by URNA to the SPV and are not available to satisfy the obligations of URNA or Parent’s other subsidiaries. The guarantor subsidiaries are all 100 percent-owned and the guarantees are made on a joint and several basis. The guarantees are not full and unconditional because a guarantor subsidiary can be automatically released and relieved of its obligations under certain circumstances, including sale of the guarantor subsidiary, the sale of all or substantially all of the guarantor subsidiary's assets, the requirements for legal defeasance or covenant defeasance under the applicable indenture being met, designating the guarantor subsidiary as an unrestricted subsidiary for purposes of the applicable covenants or, other than with respect to the guarantees of the 5 ³/₄ percent Senior Notes due 2024, the notes being rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA. The guarantees are also subject to subordination provisions (to the same extent that the obligations of the issuer under the relevant notes are subordinated to other debt of the issuer) and to a standard limitation which provides that the maximum amount guaranteed by each guarantor will not exceed the maximum amount that can be guaranteed without making the guarantee void under fraudulent conveyance laws. Based on our understanding of Rule 3-10 of Regulation S-X ("Rule 3-10"), we believe that the guarantees of the guarantor subsidiaries comply with the conditions set forth in Rule 3-10 and therefore continue to utilize Rule 3-10 to present condensed consolidating financial information for Holdings, URNA, the guarantor subsidiaries and the non-guarantor subsidiaries. Separate consolidated financial statements of the guarantor subsidiaries have not been presented because management believes that such information would not be material to investors. However, condensed consolidating financial information is presented.

URNA covenants in the ABL facility, accounts receivable securitization facility and the other agreements governing our debt impose operating and financial restrictions on URNA, Parent and the guarantor subsidiaries, including limitations on the ability to make share repurchases and dividend payments. As of September 30, 2018, the amount available for distribution under the most restrictive of these covenants was $709. The Company’s total available capacity for making share repurchases and dividend payments includes the intercompany receivable balance of Parent. As of September 30, 2018, our total available capacity for making share repurchases and dividend payments, which includes URNA’s capacity to make restricted payments and the intercompany receivable balance of Parent, was $2.034 billion.

The condensed consolidating financial information of Parent and its subsidiaries is as follows:

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING BALANCE SHEET

September 30, 2018

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			Domestic
ASSETS
Cash and cash equivalents	$	—	$	17		$	—		$	48		$	—	$	—		$	65
Accounts receivable, net	—		—			—			141			1,297		—			1,438
Intercompany receivable (payable)	1,325		(1,200		)	(96		)	(29		)	—		—			—
Inventory	—		94			—			10			—		—			104
Prepaid expenses and other assets	—		81			—			4			—		—			85
Total current assets	1,325		(1,008		)	(96		)	174			1,297		—			1,692
Rental equipment, net	—		8,243			—			667			—		—			8,910
Property and equipment, net	51		394			40			44			—		—			529
Investments in subsidiaries	1,973		1,534			966			—			22		(4,495		)	—
Goodwill	—		3,902			—			411			—		—			4,313
Other intangible assets, net	—		812			—			83			—		—			895
Other long-term assets	7		8			—			—			—		—			15
Total assets	$	3,356	$	13,885		$	910		$	1,379		$	1,319	$	(4,495	)	$	16,354
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	28		$	—		$	2		$	865	$	—		$	896
Accounts payable	—		624			—			64			—		—			688
Accrued expenses and other liabilities	—		449			14			38			2		—			503
Total current liabilities	1		1,101			14			104			867		—			2,087
Long-term debt	—		9,170			9			3			—		—			9,182
Deferred taxes	21		1,518			—			89			—		—			1,628
Other long-term liabilities	—		123			—			—			—		—			123
Total liabilities	22		11,912			23			196			867		—			13,020
Total stockholders’ equity (deficit)	3,334		1,973			887			1,183			452		(4,495		)	3,334
Total liabilities and stockholders’ equity (deficit)	$	3,356	$	13,885		$	910		$	1,379		$	1,319	$	(4,495	)	$	16,354

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2017

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			Domestic
ASSETS
Cash and cash equivalents	$	—	$	23		$	—		$	329		$	—	$	—		$	352
Accounts receivable, net	—		56			—			119			1,058		—			1,233
Intercompany receivable (payable)	887		(677		)	(198		)	(124		)	—		112			—
Inventory	—		68			—			7			—		—			75
Prepaid expenses and other assets	4		219			111			2			—		(224		)	112
Total current assets	891		(311		)	(87		)	333			1,058		(112		)	1,772
Rental equipment, net	—		7,264			—			560			—		—			7,824
Property and equipment, net	41		352			32			42			—		—			467
Investments in subsidiaries	2,194		1,148			1,087			—			—		(4,429		)	—
Goodwill	—		3,815			—			267			—		—			4,082
Other intangible assets, net	—		827			—			48			—		—			875
Other long-term assets	3		7			—			—			—		—			10
Total assets	$	3,129	$	13,102		$	1,032		$	1,250		$	1,058	$	(4,541	)	$	15,030
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	25		$	—		$	2		$	695	$	—		$	723
Accounts payable	—		366			—			43			—		—			409
Accrued expenses and other liabilities	—		477			17			41			1		—			536
Total current liabilities	1		868			17			86			696		—			1,668
Long-term debt	1		8,596			117			3			—		—			8,717
Deferred taxes	21		1,324			—			74			—		—			1,419
Other long-term liabilities	—		120			—			—			—		—			120
Total liabilities	23		10,908			134			163			696		—			11,924
Total stockholders’ equity (deficit)	3,106		2,194			898			1,087			362		(4,541		)	3,106
Total liabilities and stockholders’ equity (deficit)	$	3,129	$	13,102		$	1,032		$	1,250		$	1,058	$	(4,541	)	$	15,030

33

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2018

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	1,715	$	—		$	146	$	—		$	—		$	1,861
Sales of rental equipment	—			128		—			12		—			—			140
Sales of new equipment	—			46		—			8		—			—			54
Contractor supplies sales	—			22		—			2		—			—			24
Service and other revenues	—			32		—			5		—			—			37
Total revenues	—			1,943		—			173		—			—			2,116
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			614		—			57		—			—			671
Depreciation of rental equipment	—			316		—			27		—			—			343
Cost of rental equipment sales	—			76		—			7		—			—			83
Cost of new equipment sales	—			40		—			6		—			—			46
Cost of contractor supplies sales	—			14		—			1		—			—			15
Cost of service and other revenues	—			16		—			4		—			—			20
Total cost of revenues	—			1,076		—			102		—			—			1,178
Gross profit	—			867		—			71		—			—			938
Selling, general and administrative expenses	28			197		—			24		16			—			265
Merger related costs	—			11		—			—		—			—			11
Restructuring charge	—			8		—			1		—			—			9
Non-rental depreciation and amortization	3			65		—			7		—			—			75
Operating (loss) income	(31		)	586		—			39		(16		)	—			578
Interest (income) expense, net	(11		)	122		(1		)	1		7			—			118
Other (income) expense, net	(172		)	196		—			13		(37		)	—			—
Income before provision for income taxes	152			268		1			25		14			—			460
Provision for income taxes	45			71		—			8		3			—			127
Income before equity in net earnings (loss) of subsidiaries	107			197		1			17		11			—			333
Equity in net earnings (loss) of subsidiaries	226			29		17			—		—			(272		)	—
Net income (loss)	333			226		18			17		11			(272		)	333
Other comprehensive income (loss)	18			18		18			18		—			(54		)	18
Comprehensive income (loss)	$	351		$	244	$	36		$	35	$	11		$	(326	)	$	351

34

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2017

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	1,407	$	—		$	129	$	—		$	—		$	1,536
Sales of rental equipment	—			118		—			21		—			—			139
Sales of new equipment	—			36		—			4		—			—			40
Contractor supplies sales	—			18		—			3		—			—			21
Service and other revenues	—			27		—			3		—			—			30
Total revenues	—			1,606		—			160		—			—			1,766
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			502		—			55		—			—			557
Depreciation of rental equipment	—			266		—			24		—			—			290
Cost of rental equipment sales	—			73		—			11		—			—			84
Cost of new equipment sales	—			31		—			3		—			—			34
Cost of contractor supplies sales	—			12		—			2		—			—			14
Cost of service and other revenues	—			12		—			2		—			—			14
Total cost of revenues	—			896		—			97		—			—			993
Gross profit	—			710		—			63		—			—			773
Selling, general and administrative expenses	42			167		—			19		9			—			237
Merger related costs	—			16		—			—		—			—			16
Restructuring charge	—			8		—			1		—			—			9
Non-rental depreciation and amortization	3			54		—			6		—			—			63
Operating (loss) income	(45		)	465		—			37		(9		)	—			448
Interest (income) expense, net	(5		)	133		1			1		3			(2		)	131
Other (income) expense, net	(144		)	154		—			10		(25		)	—			(5		)
Income (loss) before provision for income taxes	104			178		(1		)	26		13			2			322
Provision for income taxes	39			73		—			7		4			—			123
Income (loss) before equity in net earnings (loss) of subsidiaries	65			105		(1		)	19		9			2			199
Equity in net earnings (loss) of subsidiaries	134			29		19			—		—			(182		)	—
Net income (loss)	199			134		18			19		9			(180		)	199
Other comprehensive income (loss)	42			42		41			33		—			(116		)	42
Comprehensive income (loss)	$	241		$	176	$	59		$	52	$	9		$	(296	)	$	241

35

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Nine Months EndedSeptember 30, 2018

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations			Total
										Foreign			Domestic
Revenues:
Equipment rentals	$	—		$	4,568		$	—		$	383		$	—		$	—		$	4,951
Sales of rental equipment	—			435			—			43			—			—			478
Sales of new equipment	—			123			—			17			—			—			140
Contractor supplies sales	—			58			—			8			—			—			66
Service and other revenues	—			92			—			14			—			—			106
Total revenues	—			5,276			—			465			—			—			5,741
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			1,710			—			173			—			—			1,883
Depreciation of rental equipment	—			911			—			77			—			—			988
Cost of rental equipment sales	—			259			—			23			—			—			282
Cost of new equipment sales	—			107			—			14			—			—			121
Cost of contractor supplies sales	—			38			—			5			—			—			43
Cost of service and other revenues	—			49			—			9			—			—			58
Total cost of revenues	—			3,074			—			301			—			—			3,375
Gross profit	—			2,202			—			164			—			—			2,366
Selling, general and administrative expenses	33			604			—			66			33			—			736
Merger related costs	—			14			—			—			—			—			14
Restructuring charge	—			14			—			1			—			—			15
Non-rental depreciation and amortization	11			185			—			17			—			—			213
Operating (loss) income	(44		)	1,385			—			80			(33		)	—			1,388
Interest (income) expense, net	(26		)	349			—			—			17			(1		)	339
Other (income) expense, net	(469		)	529			—			37			(99		)	—			(2		)
Income before provision for income taxes	451			507			—			43			49			1			1,051
Provision for income taxes	105			135			—			13			12			—			265
Income before equity in net earnings (loss) of subsidiaries	346			372			—			30			37			1			786
Equity in net earnings (loss) of subsidiaries	440			68			30			—			—			(538		)	—
Net income (loss)	786			440			30			30			37			(537		)	786
Other comprehensive (loss) income	(27		)	(27		)	(28		)	(95		)	—			150			(27		)
Comprehensive income (loss)	$	759		$	413		$	2		$	(65	)	$	37		$	(387	)	$	759

36

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Nine Months EndedSeptember 30, 2017

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	3,739	$	—		$	330	$	—		$	—		$	4,069
Sales of rental equipment	—			334		—			44		—			—			378
Sales of new equipment	—			113		—			13		—			—			126
Contractor supplies sales	—			53		—			7		—			—			60
Service and other revenues	—			75		—			11		—			—			86
Total revenues	—			4,314		—			405		—			—			4,719
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			1,397		—			159		—			—			1,556
Depreciation of rental equipment	—			738		—			66		—			—			804
Cost of rental equipment sales	—			202		—			23		—			—			225
Cost of new equipment sales	—			97		—			11		—			—			108
Cost of contractor supplies sales	—			37		—			5		—			—			42
Cost of service and other revenues	—			37		—			5		—			—			42
Total cost of revenues	—			2,508		—			269		—			—			2,777
Gross profit	—			1,806		—			136		—			—			1,942
Selling, general and administrative expenses	84			483		—			57		24			—			648
Merger related costs	—			32		—			—		—			—			32
Restructuring charge	—			27		—			1		—			—			28
Non-rental depreciation and amortization	11			162		—			16		—			—			189
Operating (loss) income	(95		)	1,102		—			62		(24		)	—			1,045
Interest (income) expense, net	(10		)	341		2			1		8			(4		)	338
Other (income) expense, net	(387		)	419		—			33		(70		)	—			(5		)
Income (loss) before provision for income taxes	302			342		(2		)	28		38			4			712
Provision for income taxes	102			140		—			7		14			—			263
Income (loss) before equity in net earnings (loss) of subsidiaries	200			202		(2		)	21		24			4			449
Equity in net earnings (loss) of subsidiaries	249			47		21			—		—			(317		)	—
Net income (loss)	449			249		19			21		24			(313		)	449
Other comprehensive income (loss)	75			75		75			61		—			(211		)	75
Comprehensive income (loss)	$	524		$	324	$	94		$	82	$	24		$	(524	)	$	524

37

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Nine Months EndedSeptember 30, 2018

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			Domestic
Net cash provided by (used in) operating activities	$	22		$	2,354		$	(1	)	$	(50	)	$	(202	)	$	—	$	2,123
Net cash used in investing activities	(22		)	(2,259		)	—			(112		)	—			—		(2,393		)
Net cash (used in) provided by financing activities	—			(101		)	1			(109		)	202			—		(7		)
Effect of foreign exchange rates	—			—			—			(10		)	—			—		(10		)
Net decrease in cash and cash equivalents	—			(6		)	—			(281		)	—			—		(287		)
Cash and cash equivalents at beginning of period	—			23			—			329			—			—		352
Cash and cash equivalents at end of period	$	—		$	17		$	—		$	48		$	—		$	—	$	65

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Nine Months EndedSeptember 30, 2017

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			Domestic
Net cash provided by (used in) operating activities	$	15		$	1,839		$	(2	)	$	83		$	(179	)	$	—	$	1,756
Net cash used in investing activities	(15		)	(2,135		)	—			(92		)	—			—		(2,242		)
Net cash provided by (used in) financing activities	—			298			2			(2		)	179			—		477
Effect of foreign exchange rates	—			—			—			21			—			—		21
Net increase in cash and cash equivalents	—			2			—			10			—			—		12
Cash and cash equivalents at beginning of period	—			21			—			291			—			—		312
Cash and cash equivalents at end of period	$	—		$	23		$	—		$	301		$	—		$	—	$	324

38

UNITED RENTALS, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(Dollars in millions, except per share data, unless otherwise indicated)

12. Subsequent Event

In September 2018, we entered into a definitive merger agreement to acquire Vander Holding Corporation and its subsidiaries (“BlueLine”) for approximately $2.1 billion. We expect to fund the merger and related fees and expenses using a new $1 billion term loan facility and other debt issuances. BlueLine is one of the ten largest equipment rental companies in North America, serves over 50,000 customers in the construction and industrial sectors with a focus on mid-sized and local accounts, and has 114 locations and over 1,700 employees based in 25 U.S. states, Canada and Puerto Rico. BlueLine has annual revenues of approximately $786. We expect the merger to close in the fourth quarter of 2018, subject to Hart-Scott-Rodino clearance and other customary conditions.

39

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (dollars in millions, except per share data, unless otherwise indicated)

Executive Overview

We are the largest equipment rental company in the world, with an integrated network of 1,086 rental locations in the United States, Canada and Europe. As discussed in note 3 to the condensed consolidated financial statements, in July 2018, we completed the acquisition of BakerCorp, which allowed for our entry into select European markets. Although the equipment rental industry is highly fragmented and diverse, we believe that we are well positioned to take advantage of this environment because, as a larger company, we have more extensive resources and certain competitive advantages. These include a fleet of rental equipment with a total original equipment cost (“OEC”) of $12.9 billion, and a national branch network that operates in 49 U.S. states and every Canadian province, and serves 99 of the largest 100 metropolitan areas in the U.S. The BakerCorp acquisition discussed above added 11 European locations in France, Germany, the United Kingdom and the Netherlands to our branch network. Our size also gives us greater purchasing power, the ability to provide customers with a broader range of equipment and services, the ability to provide customers with equipment that is more consistently well-maintained and therefore more productive and reliable, and the ability to enhance the earning potential of our assets by transferring equipment among branches to satisfy customer needs.

We offer approximately 3,800 classes of equipment for rent to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. Our revenues are derived from the following sources: equipment rentals, sales of rental equipment, sales of new equipment, contractor supplies sales and service and other revenues. Equipment rentals represented 86 percent of total revenues for the nine months ended September 30, 2018.

For the past several years, we have executed a strategy focused on improving the profitability of our core equipment rental business through revenue growth, margin expansion and operational efficiencies. In particular, we have focused on customer segmentation, customer service differentiation, rate management, fleet management and operational efficiency.

In 2018, we have continued our disciplined focus on increasing our profitability and return on invested capital. In particular, our strategy calls for:

• A consistently superior standard of service to customers, often provided through a single point of contact;

• The further optimization of our customer mix and fleet mix, with a dual objective: to enhance our performance in serving our current customer base, and to focus on the accounts and customer types that are best suited to our strategy for profitable growth. We believe these efforts will lead to even better service of our target accounts, primarily large construction and industrial customers, as well as select local contractors. Our fleet team's analyses are aligned with these objectives to identify trends in equipment categories and define action plans that can generate improved returns;

• A continued focus on “Lean” management techniques, including kaizen processes focused on continuous improvement. We continue to implement Lean kaizen processes across our branch network, with the objectives of: reducing the cycle time associated with renting our equipment to customers; improving invoice accuracy and service quality; reducing the elapsed time for equipment pickup and delivery; and improving the effectiveness and efficiency of our repair and maintenance operations. We achieved the anticipated run rate savings from the Lean initiatives, including those included in the Project XL work streams discussed below, in 2017 and 2016, and expect to continue to generate savings from these initiatives;

• The implementation of Project XL, which is a set of eight specific work streams focused on driving profitable growth through revenue opportunities and generating incremental profitability through cost savings across our business;

• The continued expansion of our trench, power and fluid solutions footprint, as well as our tools offering, and the cross-selling of these services throughout our network, as exhibited by our acquisition of BakerCorp discussed in note 3 to the condensed consolidated financial statements. We believe that the expansion of our trench, power and fluid solutions business, as well as our tools offering, will further position United Rentals as a single source provider of total jobsite solutions through our extensive product and service resources and technology offerings; and

• The pursuit of strategic acquisitions to continue to expand our core equipment rental business, as exhibited by our recently completed acquisitions of NES and Neff, and the pending acquisition of BlueLine discussed in note 12 to the condensed consolidated financial statements. Strategic acquisitions allow us to invest our capital to expand our business, further driving our ability to accomplish our strategic goals.

For the nine months ended September 30, 2018, equipment rental revenue increased21.7 percent as compared to the same period in 2017, primarily reflecting a 19.6 percent increase in the volume of OEC on rent, which includes the impact of

40

the NES, Neff and BakerCorp acquisitions discussed in note 3 to the condensed consolidated financial statements, and a 2.3 percent rental rate increase. Rental rate changes are calculated based on the year-over-year variance in average contract rates, weighted by the prior period revenue mix. On a pro forma basis including the standalone, pre-acquisition results of NES, Neff and BakerCorp, equipment rental revenue increased 11.0 percent year-over-year, primarily reflecting a 7.3 percent increase in the volume of OEC on rent and a 2.4 percent rental rate increase. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets. In particular, we saw improvement in our trench, power and fluid solutions segment. The volume of OEC on rent increased 42.4 percent in our trench, power and fluid solutions segment, primarily due to continued strength in our Trench Safety and Power and HVAC regions, and improved performance in our Fluid Solutions region. On a pro forma basis including the standalone, pre-acquisition results of BakerCorp, the volume of OEC on rent increased 26.7 percent in our trench, power and fluid solutions segment. The improvement in the Fluid Solutions region reflects growth in revenue from upstream oil and gas customers, which have experienced significant volatility in recent years. Additionally, due in part to the upstream oil and gas volatility, we have sought to diversify our revenue mix to achieve a reduced portion of business tied to oil and gas. We have diversified outside of oil and gas, and have grown our revenue from most of our non oil and gas customers (for example, industrial, construction and mining customers).

Financial Overview

Since January 1, 2017, we have taken the following actions to improve our financial flexibility and liquidity, and to position us to invest the necessary capital in our business:

• Redeemed all of our 7 ⁵/₈ percent Senior Notes and 6 ¹/₈ percent Senior Notes;

• Issued $750 principal amount of 4 ⁵/₈ percent Senior Notes due 2025;

• Issued $250 principal amount of 5 ⁷/₈ percent Senior Notes due 2026, as an add-on to our existing 5 ⁷/₈ percent Senior Notes due 2026;

• Issued $250 principal amount of 5 ¹/₂ percent Senior Notes due 2027, as an add-on to our existing 5 ¹/₂ percent Senior Notes due 2027;

• Issued $1.675 billion principal amount of 4 ⁷/₈ percent Senior Notes due 2028, comprised of separate issuances of $925 in August 2017 and $750 in September 2017. Following the issuances, we consummated an exchange offer pursuant to which most of the 4 ⁷/₈ percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 ⁷/₈ percent Senior Notes issued in August 2017;

• Amended and extended our ABL facility, including an increase in the facility size from $2.5 billion to $3.0 billion; and

• Amended and extended our accounts receivable securitization facility, including an increase in the facility size from $625 to $875.

As discussed in note 12 to the condensed consolidated financial statements, we expect to use a new $1 billion term loan facility and other debt issuances to fund the approximately $2.1 billion pending acquisition of BlueLine. As of September 30, 2018, we had available liquidity of $910, including cash and cash equivalents of $65.

Net income. Net income and diluted earnings per share for the three and nine months ended September 30, 2018 and 2017 are presented below.Net income and diluted earnings per share for 2018 reflect lower effective tax rates due to the enactment of the Tax Cuts and Jobs Act (the "Tax Act") in December 2017, as discussed further below (see "Results of Operations-Other costs/(income)"). The Tax Act reduced the U.S. federal statutory tax rate from 35 percent to 21 percent, which contributed an estimated $0.73 and $1.68 to diluted earnings per share for the three and nine months ended September 30, 2018, respectively.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Net income	$	333	$	199	$	786	$	449
Diluted earnings per share	$	4.01	$	2.33	$	9.34	$	5.26

Net income and diluted earnings per share for the three and nine months ended September 30, 2018 and 2017 include the after-tax impacts of the items below. The tax rates applied to the items below reflect the statutory rates in the applicable entities. The reduction in the tax rates for 2018 reflects the enactment of the Tax Act.

41

	Three Months Ended September 30,												Nine Months Ended September 30,
	2018						2017						2018						2017
Tax rate applied to items below	25.4		%				38.5		%				25.3		%				38.5		%
	Contribution to net income (after-tax)			Impact on diluted earnings per share			Contribution to net income (after-tax)			Impact on diluted earnings per share			Contribution to net income (after-tax)			Impact on diluted earnings per share			Contribution to net income (after-tax)			Impact on diluted earnings per share
Merger related costs (1)	$	(7	)	$	(0.09	)	$	(10	)	$	(0.12	)	$	(10	)	$	(0.12	)	$	(20	)	$	(0.23	)
Merger related intangible asset amortization (2)	(35		)	(0.42		)	(24		)	(0.27		)	(99		)	(1.18		)	(72		)	(0.83		)
Impact on depreciation related to acquired fleet and property and equipment (3)	(1		)	(0.02		)	(6		)	(0.07		)	(16		)	(0.19		)	(4		)	(0.05		)
Impact of the fair value mark-up of acquired fleet (4)	(10		)	(0.11		)	(15		)	(0.17		)	(40		)	(0.47		)	(31		)	(0.36		)
Restructuring charge (5)	(7		)	(0.09		)	(6		)	(0.07		)	(11		)	(0.13		)	(18		)	(0.21		)
Loss on repurchase/redemption of debt securities and amendment of ABL facility	—			—			(18		)	(0.22		)	—			—			(26		)	(0.31		)

(1) This reflects transaction costs associated with the NES, Neff and BakerCorp acquisitions discussed in note 3 to our condensed consolidated financial statements, and the pending BlueLine acquisition discussed in note 12 to our condensed consolidated financial statements. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. For additional information, see "Results of Operations-Other costs/(income)-merger related costs" below.

(2) This reflects the amortization of the intangible assets acquired in the RSC, National Pump, NES, Neff and BakerCorp acquisitions.

(3) This reflects the impact of extending the useful lives of equipment acquired in the RSC, NES, Neff and BakerCorp acquisitions, net of the impact of additional depreciation associated with the fair value mark-up of such equipment.

(4) This reflects additional costs recorded in cost of rental equipment sales associated with the fair value mark-up of rental equipment acquired in the RSC, NES and Neff acquisitions that was subsequently sold.

(5) This primarily reflects severance and branch closure charges associated with our restructuring programs. For additional information, see note 5 to our condensed consolidated financial statements.

EBITDA GAAP Reconciliations. EBITDA represents the sum of net income, provision for income taxes, interest expense, net, depreciation of rental equipment and non-rental depreciation and amortization. Adjusted EBITDA represents EBITDA plus the sum of the merger related costs, restructuring charge, stock compensation expense, net and the impact of the fair value mark-up of the acquired fleet. These items are excluded from adjusted EBITDA internally when evaluating our operating performance and for strategic planning and forecasting purposes, and allow investors to make a more meaningful comparison between our core business operating results over different periods of time, as well as with those of other similar companies. The EBITDA and adjusted EBITDA margins represent EBITDA or adjusted EBITDA divided by total revenue. Management believes that EBITDA and adjusted EBITDA, when viewed with the Company’s results under GAAP and the accompanying reconciliations, provide useful information about operating performance and period-over-period growth, and provide additional information that is useful for evaluating the operating performance of our core business without regard to potential distortions. Additionally, management believes that EBITDA and adjusted EBITDA help investors gain an understanding of the factors and trends affecting our ongoing cash earnings, from which capital investments are made and debt is serviced. However, EBITDA and adjusted EBITDA are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as alternatives to net income or cash flow from operating activities as indicators of operating performance or liquidity.

The table below provides a reconciliation between net income and EBITDA and adjusted EBITDA:

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	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Net income	$	333	$	199	$	786	$	449
Provision for income taxes	127		123		265		263
Interest expense, net	118		131		339		338
Depreciation of rental equipment	343		290		988		804
Non-rental depreciation and amortization	75		63		213		189
EBITDA	$	996	$	806	$	2,591	$	2,043
Merger related costs (1)	11		16		14		32
Restructuring charge (2)	9		9		15		28
Stock compensation expense, net (3)	30		24		73		64
Impact of the fair value mark-up of acquired fleet (4)	13		24		53		50
Adjusted EBITDA	$	1,059	$	879	$	2,746	$	2,217

The table below provides a reconciliation between net cash provided by operating activities and EBITDA and adjusted EBITDA:

	Nine Months Ended
	September 30,
	2018			2017
Net cash provided by operating activities	$	2,123		$	1,756
Adjustments for items included in net cash provided by operating activities but excluded from the calculation of EBITDA:
Amortization of deferred financing costs and original issue discounts	(9		)	(6		)
Gain on sales of rental equipment	196			153
Gain on sales of non-rental equipment	4			4
Gain on insurance proceeds from damaged equipment	18			10
Merger related costs (1)	(14		)	(32		)
Restructuring charge (2)	(15		)	(28		)
Stock compensation expense, net (3)	(73		)	(64		)
Loss on repurchase/redemption of debt securities and amendment of ABL facility	—			(43		)
Changes in assets and liabilities	(68		)	(126		)
Cash paid for interest	379			305
Cash paid for income taxes, net	50			114
EBITDA	$	2,591		$	2,043
Add back:
Merger related costs (1)	14			32
Restructuring charge (2)	15			28
Stock compensation expense, net (3)	73			64
Impact of the fair value mark-up of acquired fleet (4)	53			50
Adjusted EBITDA	$	2,746		$	2,217

 ___________________

(1) This reflects transaction costs associated with the NES, Neff and BakerCorp acquisitions discussed in note 3 to our condensed consolidated financial statements, and the pending BlueLine acquisition discussed in note 12 to our condensed consolidated financial statements. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. For additional information, see "Results of Operations-Other costs/(income)-merger related costs" below.

(2) This primarily reflects severance and branch closure charges associated with our restructuring programs. For additional information, see note 5 to our condensed consolidated financial statements.

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(3) Represents non-cash, share-based payments associated with the granting of equity instruments.

(4) This reflects additional costs recorded in cost of rental equipment sales associated with the fair value mark-up of rental equipment acquired in the RSC, NES and Neff acquisitions that was subsequently sold.

For the three months ended September 30, 2018, EBITDA increased$190, or 23.6 percent, and adjusted EBITDA increased$180, or 20.5 percent. For the three months ended September 30, 2018, EBITDA margin increased150 basis points to 47.1 percent, and adjusted EBITDA margin increased20 basis points to 50.0 percent. As discussed in note 3 to our condensed consolidated financial statements, we completed the acquisitions of Neff in October 2017 and BakerCorp in July 2018, and EBITDA and adjusted EBITDA for 2018 include the impact of Neff and BakerCorp. The increase in the EBITDA margin primarily reflects i) reduced merger related costs, ii) a decrease in selling, general and administrative ("SG&A") expense as a percentage of revenue primarily due to a reduction in salaries and bonuses as a percentage of revenue and iii) a change in revenue mix, with higher margin equipment rentals representing a larger portion of total revenues in 2018.

For the nine months ended September 30, 2018, EBITDA increased$548, or 26.8 percent, and adjusted EBITDA increased$529, or 23.9 percent. For the nine months ended September 30, 2018, EBITDA margin increased180 basis points to 45.1 percent, and adjusted EBITDA margin increased80 basis points to 47.8 percent. As discussed in note 3 to our condensed consolidated financial statements, we completed the acquisitions of NES in April 2017, Neff in October 2017 and BakerCorp in July 2018, and EBITDA and adjusted EBITDA for 2018 include the impact of NES, Neff and BakerCorp. The increase in the EBITDA margin primarily reflects i) reduced merger related costs and restructuring charges and ii) a decrease in SG&A expense as a percentage of revenue primarily due to a reduction in salaries and bonuses as a percentage of revenue. The increase in the adjusted EBITDA margin primarily reflects a decrease in SG&A expense as a percentage of revenue primarily due to a reduction in salaries and bonuses as a percentage of revenue.

Results of Operations

As discussed in note 4 to our condensed consolidated financial statements, our reportable segments are general rentals and trench, power and fluid solutions. The general rentals segment includes the rental of construction, aerial, industrial and homeowner equipment and related services and activities. The general rentals segment’s customers include construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities. The general rentals segment operates throughout the United States and Canada. The trench, power and fluid solutions segment is comprised of i) the Trench Safety region, which rents trench safety equipment such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, ii) the Power and HVAC region, which rents power and HVAC equipment such as portable diesel generators, electrical distribution equipment, and temperature control equipment including heating and cooling equipment, and iii) the Fluid Solutions and iv) Fluid Solutions Europe regions, both of which rent equipment primarily used for fluid storage, transfer and treatment. The trench, power and fluid solutions segment’s customers include construction companies involved in infrastructure projects, municipalities and industrial companies. The trench, power and fluid solutions segment operates throughout the United States and in Canada and Europe.

As discussed in note 4 to our condensed consolidated financial statements, we aggregate our 11 geographic regions—Carolinas, Gulf South, Industrial (which serves the geographic Gulf region and has a strong industrial presence), Mid-Atlantic, Mid Central, Midwest, Northeast, Pacific West, South, Southeast and Western Canada—into our general rentals reporting segment. Historically, there have been variances in the levels of equipment rentals gross margins achieved by these regions. For the five year period ended September 30, 2018, two of our general rentals' regions had an equipment rentals gross margin that varied by between 10 percent and 12 percent from the equipment rentals gross margins of the aggregated general rentals' regions over the same period. The rental industry is cyclical, and there historically have been regions with equipment rentals gross margins that varied by greater than 10 percent from the equipment rentals gross margins of the aggregated general rentals' regions, though the specific regions with margin variances of over 10 percent have fluctuated. We expect margin convergence going forward given the cyclical nature of the rental industry, and monitor the margin variances and confirm the expectation of future convergence on a quarterly basis.

We similarly monitor the margin variances for the regions in the trench, power and fluid solutions segment. The trench, power and fluid solutions segment includes the locations acquired in the July 2018 BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements. As such, there is not a long history of the acquired locations' rental margins included in the trench, power and pump segment. When monitoring for margin convergence, we include projected future results. We monitor the trench, power and fluid solutions segment margin variances and confirm the expectation of future convergence on a quarterly basis. The historic, pre-acquisition margins for the acquired BakerCorp locations are lower than the margins achieved at the other locations in the segment. We expect that the margins at the acquired locations will increase as we realize synergies following the acquisition, as a result of which, we expect future margin convergence.

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We believe that the regions that are aggregated into our segments have similar economic characteristics, as each region is capital intensive, offers similar products to similar customers, uses similar methods to distribute its products, and is subject to similar competitive risks. The aggregation of our regions also reflects the management structure that we use for making operating decisions and assessing performance. Although we believe aggregating these regions into our reporting segments for segment reporting purposes is appropriate, to the extent that there are significant margin variances that do not converge, we may be required to disaggregate the regions into separate reporting segments. Any such disaggregation would have no impact on our consolidated results of operations.

These segments align our external segment reporting with how management evaluates and allocates resources. We evaluate segment performance based on segment equipment rentals gross profit. Our revenues, operating results, and financial condition fluctuate from quarter to quarter reflecting the seasonal rental patterns of our customers, with rental activity tending to be lower in the winter.

Revenues by segment were as follows:

	General rentals		Trench, power and fluid solutions		Total
Three Months Ended September 30, 2018
Equipment rentals	$	1,444	$	417	$	1,861
Sales of rental equipment	130		10		140
Sales of new equipment	50		4		54
Contractor supplies sales	17		7		24
Service and other revenues	33		4		37
Total revenue	$	1,674	$	442	$	2,116
Three Months Ended September 30, 2017
Equipment rentals	$	1,237	$	299	$	1,536
Sales of rental equipment	130		9		139
Sales of new equipment	34		6		40
Contractor supplies sales	17		4		21
Service and other revenues	26		4		30
Total revenue	$	1,444	$	322	$	1,766
Nine Months Ended September 30, 2018
Equipment rentals	$	3,977	$	974	$	4,951
Sales of rental equipment	446		32		478
Sales of new equipment	125		15		140
Contractor supplies sales	50		16		66
Service and other revenues	95		11		106
Total revenue	$	4,693	$	1,048	$	5,741
Nine Months Ended September 30, 2017
Equipment rentals	$	3,357	$	712	$	4,069
Sales of rental equipment	348		30		378
Sales of new equipment	112		14		126
Contractor supplies sales	49		11		60
Service and other revenues	76		10		86
Total revenue	$	3,942	$	777	$	4,719

Equipment rentals. For the three months ended September 30, 2018, equipment rentals of $1.861 billionincreased $325, or 21.2 percent, as compared to the same period in 2017, primarily reflecting a 17.8 percent increase in the volume of OEC on rent, which includes the impact of the Neff and BakerCorp acquisitions discussed in note 3 to our condensed consolidated financial statements, and a 2.1 percent rental rate increase. On a pro forma basis including the standalone, pre-acquisition results of Neff and BakerCorp, equipment rental revenue increased 10.9 percent year-over-year, primarily reflecting a 7.4 percent increase in the volume of OEC on rent and a 2.1 percent rental rate increase. We believe that the increases in the

45

volume of OEC on rent and rental rates reflect improving demand in many of our core markets. Equipment rentals represented 88 percent of total revenues for the three months ended September 30, 2018.

For the nine months ended September 30, 2018, equipment rentals of $4.951 billionincreased $882, or 21.7 percent, as compared to the same period in 2017, primarily reflecting a 19.6 percent increase in the volume of OEC on rent, which includes the impact of the NES, Neff and BakerCorp acquisitions discussed in note 3 to our condensed consolidated financial statements, and a 2.3 percent rental rate increase. On a pro forma basis including the standalone, pre-acquisition results of NES, Neff and BakerCorp, equipment rental revenue increased 11.0 percent year-over-year, primarily reflecting a 7.3 percent increase in the volume of OEC on rent and a 2.4 percent rental rate increase. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets. Equipment rentals represented 86 percent of total revenues for the nine months ended September 30, 2018.

For the three months ended September 30, 2018, general rentals equipment rentals increased $207, or 16.7 percent, as compared to the same period in 2017, primarily reflecting a 15.0 percent increase in the volume of OEC on rent, which includes the impact of the Neff acquisition, and increased rental rates. On a pro forma basis including the standalone, pre-acquisition results of Neff, equipment rental revenue increased 7.9 percent and the volume of OEC on rent increased 6.1 percent. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets. For the three months ended September 30, 2018, equipment rentals represented 86 percent of total revenues for the general rentals segment.

For the nine months ended September 30, 2018, general rentals equipment rentals increased $620, or 18.5 percent, as compared to the same period in 2017, primarily reflecting a 17.7 percent increase in the volume of OEC on rent, which includes the impact of the NES and Neff acquisitions, and increased rental rates. On a pro forma basis including the standalone, pre-acquisition results of NES and Neff, equipment rental revenue increased 7.0 percent and the volume of OEC on rent increased 5.5 percent. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets. For the nine months ended September 30, 2018, equipment rentals represented 85 percent of total revenues for the general rentals segment.

For the three months ended September 30, 2018, trench, power and fluid solutions equipment rentals increased $118, or 39.5 percent, as compared to the same period in 2017, primarily reflecting a 49.8 percent increase in the volume of OEC on rent. The increase in equipment rentals was less than the increase in the volume of OEC on rent primarily due to the impact of the BakerCorp acquisition discussed in note 3 to our condensed consolidated financial statements. The acquired BakerCorp equipment generates less revenue per dollar of OEC than the other equipment in the segment. On a pro forma basis including the standalone, pre-acquisition results of BakerCorp, the volume of OEC on rent increased 20.7 percent. The increase in the volume of OEC on rent reflects improved performance in our Fluid Solutions and Power and HVAC regions. The improvement in the Fluid Solutions region reflects growth in revenue from upstream oil and gas customers, which have experienced significant volatility in recent years. Additionally, due in part to the upstream oil and gas volatility, we have sought to diversify our revenue mix to achieve a reduced portion of business tied to oil and gas. We have diversified outside of oil and gas, and have grown our revenue from most of our non oil and gas customers (for example, industrial, construction and mining customers). The Power and HVAC region experienced growth in revenue from oil and gas, and non-residential construction, customers. For the three months ended September 30, 2018, equipment rentals represented 94 percent of total revenues for the trench, power and fluid solutions segment.

For the nine months ended September 30, 2018, trench, power and fluid solutions equipment rentals increased $262, or 36.8 percent, as compared to the same period in 2017, primarily reflecting a 42.4 percent increase in the volume of OEC on rent. On a pro forma basis including the standalone, pre-acquisition results of BakerCorp, the volume of OEC on rent increased 26.7 percent. The increase in the volume of OEC on rent reflects improved performance in our Fluid Solutions and Power and HVAC regions. The improvement in the Fluid Solutions region reflects growth in revenue from upstream oil and gas customers, which have experienced significant volatility in recent years. Additionally, due in part to the upstream oil and gas volatility, we have sought to diversify our revenue mix to achieve a reduced portion of business tied to oil and gas. We have diversified outside of oil and gas, and have grown our revenue from most of our non oil and gas customers (for example, industrial, construction and mining customers). The Power and HVAC region experienced growth in revenue from oil and gas, and non-residential construction, customers. For the nine months ended September 30, 2018, equipment rentals represented 93 percent of total revenues for the trench, power and fluid solutions segment.

Sales of rental equipment. For the nine months ended September 30, 2018, sales of rental equipment represented approximately 8 percent of our total revenues. Our general rentals segment accounted for most of these sales. For the three and nine months ended September 30, 2018, sales of rental equipment increased0.7 percent and 26.5 percent, respectively, from the same periods in 2017. As discussed in note 2 to the condensed consolidated financial statements, in 2018, we adopted

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accounting guidance that clarified the principles for recognizing revenue. Under the new guidance, we no longer defer recognition associated with certain sales of rental equipment that were previously deferred until certain contingent future events occurred. This change in accounting resulted in earlier recognition of some revenue that in 2017 was recognized later in the year, but does not impact total annual revenue because the contingencies that previously resulted in deferral are always resolved within the same calendar year. This change in accounting did not have a material impact on the year-over-year increase in sales of rental equipment for the nine months ended September 30, 2018. Sales of rental equipment for the nine months ended September 30, 2018 increased primarily due to increased volume, driven by a significantly larger fleet size, in a strong used equipment market. Average OEC for the nine months ended September 30, 2018 increased 20.9 percent year-over-year. The increase in average OEC includes the impact of the NES, Neff and BakerCorp acquisitions.

Sales of new equipment. For the nine months ended September 30, 2018, sales of new equipment represented approximately 2 percent of our total revenues. Our general rentals segment accounted for most of these sales. For the three and nine months ended September 30, 2018, sales of new equipment increased35.0 percent and 11.1 percent, respectively, from the same periods in 2017 primarily due to increased volume driven partially by some larger sales.

Contractor supplies sales. Contractor supplies sales represent our revenues associated with selling a variety of supplies, including construction consumables, tools, small equipment and safety supplies. For the nine months ended September 30, 2018, contractor supplies sales represented approximately 1 percent of our total revenues. Our general rentals segment accounted for most of these sales. Contractor supplies sales for the three and nine months ended September 30, 2018 did not change significantly from the same periods in 2017.

Service and other revenues. Service and other revenues primarily represent our revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). For the nine months ended September 30, 2018, service and other revenues represented approximately 2 percent of our total revenues. Our general rentals segment accounted for most of these sales. For both the three and nine months ended September 30, 2018, service and other revenues increased23.3 percent from the same period in 2017, primarily reflecting the impact of the NES acquisition discussed in note 3 to the condensed consolidated financial statements and an increased emphasis on this line of business.

Segment Equipment Rentals Gross Profit

Segment equipment rentals gross profit and gross margin were as follows:

	General rentals			Trench, power and fluid solutions			Total
Three Months Ended September 30, 2018
Equipment Rentals Gross Profit	$	629		$	218		$	847
Equipment Rentals Gross Margin	43.6		%	52.3		%	45.5		%
Three Months Ended September 30, 2017
Equipment Rentals Gross Profit	$	525		$	164		$	689
Equipment Rentals Gross Margin	42.4		%	54.8		%	44.9		%
Nine Months Ended September 30, 2018
Equipment Rentals Gross Profit	$	1,598		$	482		$	2,080
Equipment Rentals Gross Margin	40.2		%	49.5		%	42.0		%
Nine Months Ended September 30, 2017
Equipment Rentals Gross Profit	$	1,350		$	359		$	1,709
Equipment Rentals Gross Margin	40.2		%	50.4		%	42.0		%

General rentals. For the three months ended September 30, 2018, equipment rentals gross profit increased by $104 and equipment rentals gross margin increased by 120 basis points from 2017. The gross profit increase includes the impact of the Neff acquisition. The gross margin increase primarily reflects increased rental rates and decreases in certain costs as a percentage of revenue, partially offset by a 70 basis point decrease in time utilization. For the three months ended September 30, 2018 and 2017, time utilization was 71.5 percent and 72.2 percent, respectively. The decrease in time utilization included the impact of the Neff acquisition, and time utilization decreased 40 basis points on a pro forma basis including the standalone, pre-acquisition results of Neff. Additionally, time utilization for the three months ended September 30, 2017 was high due partially to increased rental activity in response to recovery and restoration efforts for hurricanes Harvey and Irma. The volume of OEC on rent increased 15.0 percent, including the impact of the Neff acquisition. On a pro forma basis, the volume of OEC on rent increased 6.1 percent. We believe that the increases in the volume of OEC on rent and rental rates

47

reflect improving demand in many of our core markets. While the volume of OEC on rent increased 15.0 percent and equipment rentals increased 16.7 percent, depreciation of rental equipment increased 15.2 percent due primarily to the Neff acquisition, delivery costs increased 2.4 percent and labor and benefits costs increased 13.8 percent.

For the nine months ended September 30, 2018, equipment rentals gross profit increased by $248. Equipment rentals gross margin was flat with 2017, reflecting increased rental rates offset by a 90 basis point decrease in time utilization. For the nine months ended September 30, 2018 and 2017, time utilization was 69.2 percent and 70.1 percent, respectively. The decrease in time utilization primarily reflected the impact of the NES and Neff acquisitions. The volume of OEC on rent increased 17.7 percent, including the impact of the NES and Neff acquisitions. On a pro forma basis including the standalone, pre-acquisition results of NES and Neff, the volume of OEC on rent increased 5.5 percent and time utilization decreased 30 basis points. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets.

Trench, power and fluid solutions. For the three months ended September 30, 2018, equipment rentals gross profit increased by $54 and equipment rentals gross margin decreased by 250 basis points from 2017. The increase in equipment rentals gross profit primarily reflects increased equipment rentals revenue on a larger fleet. Year-over-year, trench, power and fluid solutions equipment rentals increased 39.5 percent, average OEC increased 52.3 percent and the volume of OEC on rent increased 49.8 percent. The increase in equipment rentals was less than the increase in the volume of OEC on rent primarily due to the impact of the BakerCorp acquisition discussed in note 3 to our condensed consolidated financial statements. The acquired BakerCorp equipment generates less revenue per dollar of OEC than the other equipment in the segment. The decrease in the equipment rentals gross margin includes the impact of the BakerCorp acquisition and mix changes (in particular, fuel revenue, which generates lower margins, increased). The historic, pre-acquisition margins for the acquired BakerCorp locations are lower than the margins achieved at the other locations in the segment. We expect that the margins at the acquired locations will increase as we realize synergies following the acquisition.

For the nine months ended September 30, 2018, equipment rentals gross profit increased by $123 and equipment rentals gross margin decreased by 90 basis points from 2017. The increase in equipment rentals gross profit primarily reflects increased equipment rentals revenue on a larger fleet. Year-over-year, trench, power and fluid solutions equipment rentals increased 36.8 percent, average OEC increased 36.9 percent and the volume of OEC on rent increased 42.4 percent. The decrease in the equipment rentals gross margin includes the impact of the BakerCorp acquisition and mix changes (in particular, fuel revenue, which generates lower margins, increased). The historic, pre-acquisition margins for the acquired BakerCorp locations are lower than the margins achieved at the other locations in the segment. We expect that the margins at the acquired locations will increase as we realize synergies following the acquisition.

Gross Margin. Gross margins by revenue classification were as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2018		2017		Change	2018	2017	Change
Total gross margin	44.3	%	43.8	%	50 bps	41.2%	41.2%	—
Equipment rentals	45.5	%	44.9	%	60 bps	42.0%	42.0%	—
Sales of rental equipment	40.7	%	39.6	%	110 bps	41.0%	40.5%	50 bps
Sales of new equipment	14.8	%	15.0	%	(20) bps	13.6%	14.3%	(70) bps
Contractor supplies sales	37.5	%	33.3	%	420 bps	34.8%	30.0%	480 bps
Service and other revenues	45.9	%	53.3	%	(740) bps	45.3%	51.2%	(590) bps

For the three months ended September 30, 2018, total gross margin increased50 basis points from the same period in 2017 primarily due to increased gross margins from equipment rentals and sales of rental equipment. Equipment rentals gross margin increased60 basis points, primarily reflecting a 2.1 percent rental rate increase partially offset by a 100 basis point decrease in time utilization. For the three months ended September 30, 2018 and 2017, time utilization was 70.9 percent and 71.9 percent, respectively. The decrease in time utilization primarily reflected the impact of the Neff and BakerCorp acquisitions. Additionally, time utilization for the three months ended September 30, 2017 was high due partially to increased rental activity in response to recovery and restoration efforts for hurricanes Harvey and Irma. The volume of OEC on rent increased 17.8 percent, including the impact of the Neff and BakerCorp acquisitions. On a pro forma basis including the standalone, pre-acquisition results of Neff and BakerCorp, year-over-year, the volume of OEC on rent increased 7.4 percent, rental rates increased 2.1 percent and time utilization decreased 10 basis points. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets. Gross margin from sales of rental equipment increased110 basis points, primarily reflecting improved pricing and changes in the mix of equipment sold. The gross margin fluctuations from sales of new equipment, contractor supplies sales and service and other revenues generally

48

reflect normal variability, and such margins did not have a significant impact on total gross margin (gross profit for these revenue types represented 4 percent of total gross profit for the three months ended September 30, 2018).

For the nine months ended September 30, 2018, total gross margin was flat with the same period in 2017. Equipment rentals gross margin was flat with the same period in 2017. Rental rates increased 2.3 percent rental rate and time utilization decreased 80 basis points. For the nine months ended September 30, 2018 and 2017, time utilization was 68.5 percent and 69.3 percent, respectively. The decrease in time utilization primarily reflected the impact of the NES, Neff and BakerCorp acquisitions. The volume of OEC on rent increased 19.6 percent, including the impact of the NES, Neff and BakerCorp acquisitions. On a pro forma basis including the standalone, pre-acquisition results of NES, Neff and BakerCorp, the volume of OEC on rent increased 7.3 percent, time utilization increased 20 basis points and rental rates increased 2.4 percent. We believe that the increases in the volume of OEC on rent and rental rates reflect improving demand in many of our core markets. The gross margin fluctuations from sales of new equipment, contractor supplies sales and service and other revenues generally reflect normal variability, and such margins did not have a significant impact on total gross margin (gross profit for these revenue types represented 4 percent of total gross profit for the nine months ended September 30, 2018).

Other costs/(income)

The table below includes the other costs/(income) in our condensed consolidated statements of income, as well as key associated metrics, for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30,			Nine Months Ended September 30,
	2018	2017	Change	2018	2017	Change
Selling, general and administrative ("SG&A") expense	$265	$237	11.8%	$736	$648	13.6%
SG&A expense as a percentage of revenue	12.5%	13.4%	(90) bps	12.8%	13.7%	(90) bps
Merger related costs	11	16	(31.3)%	14	32	(56.3)%
Restructuring charge	9	9	—%	15	28	(46.4)%
Non-rental depreciation and amortization	75	63	19.0%	213	189	12.7%
Interest expense, net	118	131	(9.9)%	339	338	0.3%
Other income, net	—	(5)	(100.0)%	(2)	(5)	(60.0)%
Provision for income taxes	127	123	3.3%	265	263	0.8%
Effective tax rate	27.6%	38.2%	(1,060) bps	25.2%	36.9%	(1,170) bps

SG&A expense primarily includes sales force compensation, information technology costs, third party professional fees, management salaries, bad debt expense and clerical and administrative overhead. The decreases in SG&A expense as a percentage of revenue for the three and nine months ended September 30, 2018 primarily reflect a reduction in salaries and bonuses as a percentage of revenue.

The merger related costs reflect transaction costs associated with the NES, Neff and BakerCorp acquisitions discussed in note 3 to our condensed consolidated financial statements, and the pending BlueLine acquisition discussed in note 12 to our condensed consolidated financial statements. We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The historic acquisitions that have included merger related costs are RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, and National Pump, which had annual revenues of over $200 prior to the acquisition. As discussed in note 3 to our condensed consolidated financial statements, NES had annual revenues of approximately $369, Neff had annual revenues of approximately $413 and BakerCorp had annual revenues of approximately $295. As discussed in note 12 to our condensed consolidated financial statements, BlueLine has annual revenues of approximately $786.

The restructuring charges primarily reflect severance and branch closure charges associated with our restructuring programs. In the second quarter of 2017, we initiated a restructuring program following the closing of the NES acquisition discussed in note 3 to the condensed consolidated financial statements. The restructuring program also includes actions undertaken associated with Project XL, which is a set of eight specific work streams focused on driving profitable growth through revenue opportunities and generating incremental profitability through cost savings across our business, and the Neff acquisition that is discussed in note 3 to the condensed consolidated financial statements. In the third quarter of 2018, we

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initiated a restructuring program following the closing of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements. For additional information, see note 5 to the condensed consolidated financial statements.

Non-rental depreciation and amortization includes i) the amortization of other intangible assets and ii) depreciation expense associated with equipment that is not offered for rent (such as computers and office equipment) and amortization expense associated with leasehold improvements. Our other intangible assets consist of customer relationships, non-compete agreements and trade names and associated trademarks. The year-over-year increases in non-rental depreciation and amortization for the three and nine months ended September 30, 2018 primarily reflect the impact of the Neff and BakerCorp acquisitions discussed in note 3 to the condensed consolidated financial statements.

Interest expense, net for the three and nine months ended September 30, 2017 included debt redemption losses of $31 and $43, respectively. Excluding the impact of the debt redemption losses, interest expense, net increased year-over-year primarily due to the impact of higher average debt. The year-over-year increase in average debt includes the impact of the debt used to finance the NES, Neff and BakerCorp acquisitions discussed in note 3 to the condensed consolidated financial statements.

The Tax Act that was enacted in December 2017 decreased the U.S. federal statutory income tax rate from 35 percent to 21 percent. The differences between the 2018 and 2017effective tax rates and the federal statutory rates primarily reflect the geographical mix of income between foreign and domestic operations, the impact of state and local taxes, and certain nondeductible charges. The nine months ended September 30, 2018 and 2017 additionally include tax reductions of $12 and $8, respectively, associated with excess tax benefits from share-based payment arrangements. See note 1 to the condensed consolidated financial statements for further discussion of the Tax Act.

Balance sheet. Accounts receivable, net increased by $205, or 16.6 percent, from December 31, 2017 to September 30, 2018 primarily due to increased revenue, which included the impact of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements. Rental equipment, net increased by $1.086 billion, or 13.9 percent, from December 31, 2017 to September 30, 2018 primarily due to the impact of the BakerCorp acquisition and increased capital expenditures in response to a strong operating environment. Accounts payable increased by $279, or 68.2 percent, from December 31, 2017 to September 30, 2018 primarily due to a seasonal increase in capital expenditures. Deferred tax liabilities increased by $209, or 14.7 percent, from December 31, 2017 to September 30, 2018 primarily due to the impact of the full expensing of capital spending following the enactment of the Tax Act.

Liquidity and Capital Resources

We manage our liquidity using internal cash management practices, which are subject to (i) the policies and cooperation of the financial institutions we utilize to maintain and provide cash management services, (ii) the terms and other requirements of the agreements to which we are a party and (iii) the statutes, regulations and practices of each of the local jurisdictions in which we operate. See "Financial Overview" above for a summary of recent capital structure actions taken to improve our financial flexibility and liquidity.

Since 2012, we have repurchased a total of $2.45 billion of Holdings' common stock under four completed share repurchase programs. In April 2018, our Board authorized a new $1.25 billion share repurchase program, which commenced in July 2018. As of September 30, 2018, we have repurchased $210 of Holdings' common stock under the $1.25 billion share repurchase program. We expect to pause repurchases under the program following the completion of the pending BlueLine acquisition discussed in note 12 to our condensed consolidated financial statements. We intend to complete the share repurchase program; however, we will re-evaluate the decision to do so as we integrate BlueLine and assess other potential uses of capital.

Our principal existing sources of cash are cash generated from operations and from the sale of rental equipment, and borrowings available under our ABL facility and accounts receivable securitization facility. As of September 30, 2018, we had cash and cash equivalents of $65. Cash equivalents at September 30, 2018 consist of direct obligations of financial institutions rated A or better. We believe that our existing sources of cash will be sufficient to support our existing operations over the next 12 months. The table below presents financial information associated with our principal sources of cash as of and for the nine months ended September 30, 2018:

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ABL facility:
Borrowing capacity, net of letters of credit	$	836
Outstanding debt, net of debt issuance costs	2,120
Interest rate at September 30, 2018	3.7		%
Average month-end principal amount of debt outstanding (1)	1,485
Weighted-average interest rate on average debt outstanding	3.4		%
Maximum month-end principal amount of debt outstanding (1)	2,127
Accounts receivable securitization facility:
Borrowing capacity	9
Outstanding debt, net of debt issuance costs	865
Interest rate at September 30, 2018	3.0		%
Average month-end principal amount of debt outstanding	788
Weighted-average interest rate on average debt outstanding	2.8		%
Maximum month-end principal amount of debt outstanding	870

(1) The maximum month-end principal amount of debt outstanding under the ABL facility exceeded the average month-end amount outstanding during the nine months ended September 30, 2018 primarily due to the use of borrowings to fund the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements.

We expect that our principal needs for cash relating to our operations over the next 12 months will be to fund (i) operating activities and working capital, (ii) the purchase of rental equipment and inventory items offered for sale, (iii) payments due under operating leases, (iv) debt service, (v) share repurchases and (vi) acquisitions. We plan to fund such cash requirements from our existing sources of cash. In addition, we may seek additional financing through the securitization of some of our real estate, the use of additional operating leases or other financing sources as market conditions permit. As discussed in note 12 to our condensed consolidated financial statements, we expect to use a new $1 billion term loan facility and other debt issuances to fund the approximately $2.1 billion pending acquisition of BlueLine. Additionally, as noted above, we expect to pause share repurchases following the completion of the pending BlueLine acquisition.

To access the capital markets, we rely on credit rating agencies to assign ratings to our securities as an indicator of credit quality. Lower credit ratings generally result in higher borrowing costs and reduced access to debt capital markets. Credit ratings also affect the costs of derivative transactions, including interest rate and foreign currency derivative transactions. As a result, negative changes in our credit ratings could adversely impact our costs of funding. Our credit ratings as of October 15, 2018 were as follows:

	Corporate Rating	Outlook
Moody’s	Ba2	Stable
Standard & Poor’s	BB	Stable

A security rating is not a recommendation to buy, sell or hold securities. There is no assurance that any rating will remain in effect for a given period of time or that any rating will not be revised or withdrawn by a rating agency in the future.

Loan Covenants and Compliance. As of September 30, 2018, we were in compliance with the covenants and other provisions of the ABL facility, the accounts receivable securitization facility and the senior notes. Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations.

The only financial maintenance covenant that currently exists under the ABL facility is the fixed charge coverage ratio. Subject to certain limited exceptions specified in the ABL facility, the fixed charge coverage ratio covenant under the ABL facility will only apply in the future if specified availability under the ABL facility falls below 10 percent of the maximum revolver amount under the ABL facility. When certain conditions are met, cash and cash equivalents and borrowing base collateral in excess of the ABL facility size may be included when calculating specified availability under the ABL facility. As of September 30, 2018, specified availability under the ABL facility exceeded the required threshold and, as a result, this financial maintenance covenant was inapplicable. Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to: (i) the default ratio, (ii) the delinquency ratio, (iii) the dilution ratio and (iv) days sales outstanding. The accounts receivable securitization facility also requires us to comply with the fixed charge coverage ratio under the ABL facility, to the extent the ratio is applicable under the ABL facility.

URNA’s payment capacity is restricted under the covenants in the ABL facility and the indentures governing its outstanding indebtedness. Although this restricted capacity limits our ability to move operating cash flows to Holdings, because

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of certain intercompany arrangements, we do not expect any material adverse impact on Holdings’ ability to meet its cash obligations.

Sources and Uses of Cash. During the nine months ended September 30, 2018, we (i) generated cash from operating activities of $2.123 billion, (ii) generated cash from the sale of rental and non-rental equipment of $491 and (iii) received cash from debt proceeds, net of payments, of $598. We used cash during this period principally to (i) purchase rental and non-rental equipment of $2.096 billion, (ii) purchase other companies for $805 and (iii) purchase shares of our common stock for $606. During the nine months ended September 30, 2017, we (i) generated cash from operating activities of $1.756 billion, (ii) generated cash from the sale of rental and non-rental equipment of $388 and (iii) received cash from debt proceeds, net of payments, of $546. We used cash during this period principally to (i) purchase rental and non-rental equipment of $1.572 billion, (ii) purchase other companies for $1.063 billion, (iii) purchase shares of our common stock for $26 and (iv) pay financing costs of $44.

Free Cash Flow GAAP Reconciliation. We define “free cash flow” as net cash provided by operating activities less purchases of, and plus proceeds from, equipment. The equipment purchases and proceeds are included in cash flows from investing activities. Management believes that free cash flow provides useful additional information concerning cash flow available to meet future debt service obligations and working capital requirements. However, free cash flow is not a measure of financial performance or liquidity under GAAP. Accordingly, free cash flow should not be considered an alternative to net income or cash flow from operating activities as an indicator of operating performance or liquidity. The table below provides a reconciliation between net cash provided by operating activities and free cash flow.

	Nine Months Ended
	September 30,
	2018			2017
Net cash provided by operating activities	$	2,123		$	1,756
Purchases of rental equipment	(1,962		)	(1,485		)
Purchases of non-rental equipment	(134		)	(87		)
Proceeds from sales of rental equipment	478			378
Proceeds from sales of non-rental equipment	13			10
Insurance proceeds from damaged equipment	18			10
Free cash flow	$	536		$	582

Free cash flow for the nine months ended September 30, 2018 was $536, a decrease of $46 as compared to $582 for the nine months ended September 30, 2017. Free cash flow decreased primarily due to increased purchases of rental and non-rental equipment, partially offset by increased cash provided by operating activities and increased proceeds from sales of rental equipment. Net rental capital expenditures (defined as purchases of rental equipment less the proceeds from sales of rental equipment) increased $377, or 34 percent, year-over-year.

Relationship between Holdings and URNA. Holdings is principally a holding company and primarily conducts its operations through its wholly owned subsidiary, URNA, and subsidiaries of URNA. Holdings licenses its tradename and other intangibles and provides certain services to URNA in connection with its operations. These services principally include: (i) senior management services; (ii) finance and tax-related services and support; (iii) information technology systems and support; (iv) acquisition-related services; (v) legal services; and (vi) human resource support. In addition, Holdings leases certain equipment and real property that are made available for use by URNA and its subsidiaries.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Our exposure to market risk primarily consists of (i) interest rate risk associated with our variable and fixed rate debt and (ii) foreign currency exchange rate risk associated with our foreign operations.

Interest Rate Risk. As of September 30, 2018, we had an aggregate of $3.0 billion of indebtedness that bears interest at variable rates, comprised of borrowings under the ABL facility and the accounts receivable securitization facility. The amount of variable rate indebtedness outstanding under the ABL facility and accounts receivable securitization facility may fluctuate significantly. See "Liquidity and Capital Resources" above for the amounts outstanding, and the interest rates thereon, as of September 30, 2018 under the ABL facility and the accounts receivable securitization facility. As of September 30, 2018, based upon the amount of our variable rate debt outstanding, our annual after-tax earnings would decrease by approximately $22 for each one percentage point increase in the interest rates applicable to our variable rate debt.

At September 30, 2018, we had an aggregate of $7.1 billion of indebtedness that bears interest at fixed rates. A one percentage point decrease in market interest rates as of September 30, 2018 would increase the fair value of our fixed rate indebtedness by approximately six percent. For additional information concerning the fair value of our fixed rate debt, see note 7 (see “Fair Value of Financial Instruments”) to our condensed consolidated financial statements.

Currency Exchange Risk. We operate in the U.S., Canada and Europe. As discussed in note 3 to the condensed consolidated financial statements, in July 2018, we completed the acquisition of BakerCorp, which allowed for our entry into select European markets. During the nine months ended September 30, 2018, our foreign subsidiaries accounted for $465, or 8 percent, of our total revenue of $5.741 billion, and $43, or 4 percent, of our total pretax income of $1.051 billion. Based on the size of our foreign operations relative to the Company as a whole, we do not believe that a 10 percent change in exchange rates would have a material impact on our earnings. We do not engage in purchasing forward exchange contracts for speculative purposes.

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Item 4. Controls and Procedures

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

The Company’s management carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a–15(e) and 15d–15(e) of the Exchange Act, as of September 30, 2018. Based on the evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of September 30, 2018.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2018 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The information set forth under note 9 to our unaudited condensed consolidated financial statements of this quarterly report on Form 10-Q is incorporated by reference in answer to this item. Such information is limited to certain recent developments.

Item 1A. Risk Factors

Our results of operations and financial condition are subject to numerous risks and uncertainties described in our 2017 Form 10-K, which risk factors are incorporated herein by reference. You should carefully consider these risk factors in conjunction with the other information contained in this report. Should any of these risks materialize, our business, financial condition and future prospects could be negatively impacted.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) The following table provides information about purchases of Holdings’ common stock by Holdings during the third quarter of 2018:

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2)	Maximum Dollar Amount of Shares That May Yet Be Purchased Under the Program (2)
July 1, 2018 to July 31, 2018	467,525	(1)	$	149.85	467,111	—
August 1, 2018 to August 31, 2018	467,827	(1)	$	150.17	466,114	—
September 1, 2018 to September 30, 2018	436,833	(1)	$	160.68	435,643	—
Total	1,372,185		$	153.41	1,368,868	$	1,040,000,302

(1) In July 2018, August 2018 and September 2018, 414, 1,713 and 1,190 shares, respectively, were withheld by Holdings to satisfy tax withholding obligations upon the vesting of restricted stock unit awards. These shares were not acquired pursuant to any repurchase plan or program.

(2) On April 17, 2018, our Board authorized a $1.25 billion share repurchase program which commenced in July 2018. We expect to pause repurchases under the program following the completion of the pending BlueLine acquisition discussed in note 12 to our condensed consolidated financial statements. We intend to complete the share repurchase program; however, we will re-evaluate the decision to do so as we integrate BlueLine and assess other potential uses of capital.

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Item 6. Exhibits

2(a)	Agreement and Plan of Merger, dated as of June 30, 2018, by and among United Rentals, Inc., UR Merger Sub IV Corporation and BakerCorp International Holdings, Inc. (incorporated by reference to Exhibit 2.1 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on July 2, 2018)
2(b)	Agreement and Plan of Merger, dated as of September  10, 2018, by and among United Rentals, Inc., UR Merger Sub V Corporation, Vander Holding Corporation and Platinum Equity Advisors, LLC, solely in its capacity as the initial Holder Representative thereunder (incorporated by reference to Exhibit 2.1 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on September 10, 2018)
3(a)	Fourth Restated Certificate of Incorporation of United Rentals, Inc., dated June 1, 2017 (incorporated by reference to Exhibit 3.2 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on June 2, 2017)
3(b)	Amended and Restated By-Laws of United Rentals, Inc., amended as of May 4, 2017 (incorporated by reference to Exhibit 3.4 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on May 4, 2017)
3(c)	Restated Certificate of Incorporation of United Rentals (North America), Inc., dated April 30, 2012 (incorporated by reference to Exhibit 3(c) of the United Rentals, Inc. and United Rentals (North America), Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2013)
3(d)	By-laws of United Rentals (North America), Inc. dated May 8, 2013 (incorporated by reference to Exhibit 3(d) of the United Rentals, Inc. and United Rentals (North America), Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2013)
10(a)	Letter Agreement with William B. Plummer (incorporated by reference to Exhibit 10.1 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on July 2, 2018)
10(b)*	Employment Agreement, dated October 12, 2018, between United Rentals, Inc. and Andrew Limoges
12*	Computation of Ratio of Earnings to Fixed Charges
31(a)*	Rule 13a-14(a) Certification by Chief Executive Officer
31(b)*	Rule 13a-14(a) Certification by Chief Financial Officer
32(a)**	Section 1350 Certification by Chief Executive Officer
32(b)**	Section 1350 Certification by Chief Financial Officer
101	The following materials from the Quarterly Report on Form 10-Q for United Rentals, Inc. and United Rentals (North America), Inc., for the quarter ended September 30, 2018 filed on October 17, 2018, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Income, (iii) Condensed Consolidated Statements of Comprehensive Income, (iv) Condensed Consolidated Statement of Stockholders' Equity, (v) Condensed Consolidated Statements of Cash Flows, and (vi) Notes to the Unaudited Condensed Consolidated Financial Statements.

* Filed herewith.

** Furnished (and not filed) herewith pursuant to Item 601(b)(32)(ii) of Regulation S-K under the Exchange Act.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		UNITED RENTALS, INC.
Dated:	October 17, 2018	By:	ANDREW B. LIMOGES
			Andrew B. Limoges Vice President, Controller and Principal Accounting Officer
		UNITED RENTALS (NORTH AMERICA), INC.
Dated:	October 17, 2018	By:	ANDREW B. LIMOGES
			Andrew B. Limoges Vice President, Controller and Principal Accounting Officer

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EX-10.B

Exhibit 10(b)

EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”) among UNITED RENTALS, INC., UNITED RENTALS (NORTH AMERICA), INC., both Delaware corporations, each having a principal place of business at 100 First Stamford Place - Suite 700, Stamford, CT 06902 (United Rentals, Inc. and its subsidiaries and other affiliates are referred to collectively as the “Company”), and ANDREW LIMOGES (“Employee” or “you”) is hereby entered into as of October 12, 2018.

Recitals:

The Company engages in the business of renting and selling equipment and merchandise to the commercial and general public, including construction equipment, earthmoving equipment, aerial work platforms, traffic safety equipment, trench safety equipment, pumps, tanks, filtration, power and HVAC equipment, industrial equipment, sanitation equipment, landscaping equipment, home repair equipment, maintenance equipment, contractor supplies, general tools, light equipment and specialty equipment, as well as the buying of companies that engage in such activities, along with the training and computer systems designed, developed and utilized with respect to support any of the foregoing. The Company may in the future also engage in other businesses.

Employee is or will be employed by the Company in a confidential relationship where Employee, in the course of his or her employment with the Company, and in exchange for Employee’s confidentiality obligations, has become and/or will become familiar with and aware of confidential information which was established and maintained at great expense to the Company; this information is Confidential Information and/or a Trade Secret (as defined below) and constitutes valuable goodwill of the Company. The protection of these Trade Secrets and Confidential Information is of critical importance to the Company.

The Company will sustain irreparable harm if Employee should violate the provisions of this Agreement. Monetary damages for such losses would be extremely difficult to calculate and would be inadequate to fully compensate the Company.

NOW, THEREFORE, in consideration of the Company’s promotion and employment of Employee on an at-will basis as described in this Agreement and any offer letter that accompanies this Agreement, the Company’s agreement to Section 3.1, as well as the entrustment of customer relationships/goodwill, and the provision of access to the Company’s Trade Secrets and Confidential Information (both as defined below), the Employee acknowledges that sufficient consideration is being granted in exchange for the terms and provisions contained herein, including, but not limited to, the non-compete provisions contained in Section 3 hereof and the assignment provision contained in Section 9(c) hereof. For the mutual promises, terms, covenants and conditions set forth herein and the performance of each, it is hereby agreed as follows:

1.    Employment At Will; Full Time, Etc.

(a) Employee is employed on at-will basis. Employee’s employment may be terminated by the Company or by the Employee, at any time, for any reason or no reason, without notice or cause.

(b) During Employee’s employment, Employee shall devote his or her full time and attention and use his or her best efforts to promote and further the business and services of the Company and shall not be engaged in any other business activity pursued for gain, profit or other pecuniary advantage without the prior written consent of the Company. Employee shall faithfully adhere to, execute and fulfill all policies established by the Company.

(c) All funds received by Employee on behalf of the Company, if any, shall be held in trust for the Company and shall be delivered to the Company as soon as practicable. Although the Company will reimburse Employee for appropriate and properly-documented expenses that are incurred by Employee on behalf of the Company in accordance with Company policies in effect from time to time, Employee shall not seek reimbursement for, or utilize a Company credit card or funds for, personal or inappropriate expenses at any time.

(d) Employee agrees and acknowledges that if Employee is eligible to receive commissions, bonuses or other incentive pay (referred to collectively as “Incentive Compensation”), such Incentive Compensation, if any, shall be calculated in accordance with the applicable Company policies, procedures and/or plans that are in effect at that time. Employee understands and agrees that it is his or her responsibility to review such policies, procedures and/or plans as needed to ensure his or her comprehension. Employee agrees to raise any questions he or she has about such policies, procedures and/or plans with his or her supervisor or the Human Resources department. Employee further agrees and acknowledges that all applicable Company policies, procedures and/or plans may be revoked or amended at the Company’s sole discretion and at any time without advance notice to Employee.

2.    Trade Secrets; Confidentiality and Company Property. During and at all times after Employee’s employment with the Company:

(a) Employee will not communicate or disclose to any person or entity, without the Company’s prior written consent, any Trade Secrets or other Confidential Information (as defined below), whether prepared by Employee or others;

(b) Employee will not, except in the furtherance of the business of the Company, use any Trade Secrets or other Confidential Information in order to solicit, call upon or do business with any person or entity;

(c) Employee will not directly or indirectly use any Trade Secrets or other Confidential Information other than as directed by the Company in writing;

(d) Employee will not, except in the furtherance of the business of the Company, copy, delete, remove and/or retain any Trade Secrets or other Confidential Information, whether in electronic, paper, or other form, from the premises of the Company, or from Company servers, computers, cellular/mobile phones, smartphones, tablets, or other devices, without the prior written consent of the Company;

(e) All products, correspondence, reports, records, charts, customer contact information, advertising materials, designs, plans, manuals, field guides, memoranda, lists and other property compiled or produced by Employee or delivered or made available to Employee by or on behalf of the Company or by its customers (including, but not limited to, customers solicited by the Employee), whether or not Confidential Information, shall be and remain the property of the Company, shall be subject at all times to its direction and control, and shall be returned immediately whenever demanded/requested by the Company;

(f) Upon termination of employment for any reason whatsoever, or upon request at any time, Employee shall, immediately and in no event more than three (3) business days thereafter: (i) turn over to the Company, and not maintain any copy of, all Company property, data, and information, including, but not limited to, any customer names, contact information, or other customer data stored in any Company or personal cellular/mobile phone, smartphone, tablet, personal computers or other electronic device(s) (collectively, “Devices”), as well as backups of any Device stored on any other Device or in any location (“Backups”); (ii) provide to the Company, in writing, all user names, IDs, passwords, pin codes, and encryption or other access/authorization keys/data utilized by Employee with respect to any Company Devices, computers, hardware or services; (iii) comply with all exit interview and/or termination processes utilized by the Company; (iv) promptly deliver to the Company all originals and copies (whether in note, memo or other document form or on/in the Device(s), Backups, USB drive(s), hard drive(s), video, audio, computer tapes, discs, electronic media, cloud-based accounts, other formats now known or hereinafter devised, or otherwise) of all Trade Secrets or other Confidential Information, and all property identified in Section 2(e) above, that is in Employee’s possession, custody or control, whether prepared by Employee or others, including, but not limited to, the information described above in this Section 2(f); (v) tender to the Company all Company property, including but not limited to any Device(s), Backups, USB drive(s), hard drive(s), video, audio, computer tapes, discs, electronic media, cloud-based accounts, or other electronic devices or formats now known or hereinafter devised, on which Employee stored any Confidential Information or Trade Secrets; and (vi) arrange with the Company a safe, secure, and complete removal/deletion of any and all remaining electronic copies of any such data or information, including, but not limited to, the information described above in this Section 2(f);

(g) “Trade Secrets” shall mean all information not generally known about the business of the Company, which is subject to reasonable efforts to maintain its secrecy or confidentiality, and from which the Company derives economic value from the fact that the information is not generally known to others who may obtain economic value from its disclosure or use, regardless of whether such information is specifically designated as a trade secret, and regardless of whether such information may be protected as a trade secret under any applicable law. Employee acknowledges that the Company’s Trade Secrets are owned by the Company in Connecticut, and that Employee will access, utilize, and/or obtain such Trade Secrets.

(h) “Confidential Information” includes, but is not limited to:

(i) business, strategic and marketing plans and forecasts, and the past results of such plans and forecasts;

(ii) business, pricing and management methods, as well as the accumulation, compilation and organization of such information;

(iii) operations manuals and best practices memoranda;

(iv) finances, strategies, systems, research, surveys, plans, reports, recommendations and conclusions;

2

(v) arrangements with, preferences, pricing history, transaction history, identity of internal contacts or other proprietary business information relating to, the Company’s customers, equipment suppliers, manufacturers, financiers, owners or operators, representatives and other persons who have business relationships with the Company or who are prospects for business relationships with the Company;

(vi) technical information, work product and know-how;

(vii) cost, operating, and other management information systems, and other software and programming developed, maintained and/or utilized by the Company;

(viii) the name of any company or business, any part of which is or at any time was a candidate for potential acquisition by the Company, together with all analyses and other information which the Company has generated, compiled or otherwise obtained with respect to such candidate, business or potential acquisition, or with respect to the potential effect of such acquisition on the Company’s business, assets, financial results or prospects; and

(ix) the Company’s Trade Secrets (note that some of the information listed above may also be a Trade Secret).

Employee understands that the Company’s Confidential Information includes not only the individual categories of information identified in this Section 2, but also the compilation and/or aggregation of the Company’s information, which is and has been compiled/aggregated via significant effort and expense and which has value to the Company and to the Company’s employees as used in furtherance of the Company’s business.

(i) IMPORTANT NOTICE TO ALL EMPLOYEES UNDER 18 U.S.C. SECTION 1833(B): Although the Company is committed to the protection of its Confidential Information and/or Trade Secrets, Employee should be aware that an individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that is made in confidence to a Federal, State, or local government official or to an attorney solely for the purpose of reporting or investigating a suspected violation of law. An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. An individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal; and does not disclose the trade secret, except pursuant to court order.

3.    Non-Compete Provisions. The following covenants are made by Employee in partial consideration of the Company’s employment of Employee as described herein (including, but not limited to, the substantial economic investment made by the Company in the employment, education and training of Employee and the compensation and other benefits afforded by the Company to the Employee), as well as the entrustment of customer relationships/goodwill, and the provision of access to the Company’s Trade Secrets and Confidential Information. Such covenants were material inducements to the Company in deciding to invest in Employee and giving Employee access to the Company’s Trade Secrets, Confidential Information, customer relationships and goodwill.

(a) During Employee’s employment by the Company and for a period of 12 months following the termination of his or her employment for any reason whatsoever, whether or not for cause or by resignation, Employee will not, directly or indirectly (whether through affiliates, relatives or otherwise):

(i) in any Restricted Area (as hereinafter defined), be employed or retained by any person or entity who or which then competes with the Company in the Restricted Area to any reasonable extent, or directly or indirectly own any interest in any such person or entity or render to it any consulting or other services or any advice, assistance or other accommodation. Employee shall be deemed to be employed or retained in the Restricted Area if Employee has an office in the Restricted Area or if Employee performs any duties or renders any advice in, or with respect to any competitive facility or business activities in, the Restricted Area. A “Restricted Area” means each of:

(A) any state in the United States and any province in Canada in which the Company conducts any equipment rental or other equipment-related activity, it being agreed that each state and province is one unitary market for purposes of the Company’s business;

(B) the states of 1) Alabama, 2) Alaska, 3) Arizona, 4) Arkansas, 5) California, 6) Colorado, 7) Connecticut, 8) Delaware, 9) Florida, 10) Georgia, 11) Hawaii, 12) Idaho, 13) Illinois, 14) Indiana, 15) Iowa, 16) Kansas, 17) Kentucky, 18) Louisiana, 19) Maine, 20) Maryland (including the District of Columbia), 21) Massachusetts, 22) Michigan, 23) Minnesota, 24)

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Mississippi, 25) Missouri, 26) Montana, 27) Nebraska, 28) Nevada, 29) New Hampshire, 30) New Jersey, 31) New Mexico, 32) New York, 33) North Carolina, 34) North Dakota, 35) Ohio, 36) Oklahoma, 37) Oregon, 38) Pennsylvania, 39) Rhode Island, 40) South Carolina, 41) South Dakota, 42) Tennessee, 43) Texas, 44) Utah, 45) Vermont, 46) Virginia, 47) Washington, 48) West Virginia, 49) Wisconsin, and 50) Wyoming; and the Canadian Provinces of 1) New Brunswick, 2) Newfoundland and Labrador, 3) Nova Scotia, 4) Ontario, 5) Prince Edward Island, 6) Quebec, 7) Manitoba, 8) Saskatchewan, 9) Alberta, and 10) British Columbia;

(C) a 50 mile radius from any and all Company locations for which Employee performed services, or had management, financial, sales, corporate, or other responsibilities, at any time during the two year period preceding the termination of his or her employment;

(D) the geographic area(s) in which or in relation to which Employee shall have performed any duties, or had management, financial, sales, corporate, or other responsibilities, for the Company during the two year period preceding the termination of his or her employment; and

(E) the geographic area(s) in which or about which Employee had involvement in the development, review, use, presentation, or implementation of Confidential Information during the two year period preceding the termination of his or her employment.

(ii) Be employed or retained anywhere in the United States or Canada by a Similar Entity (as hereinafter defined), or directly or indirectly own any interest in any Similar Entity or render to it any consulting or other services. A "Similar Entity" means each of:

(A) the following: 1) Aggreko, 2) Ahern Rentals, 3) BlueLine Rental, 4) Caterpillar, 5) CAT Rental, 6) Deere & Co., 7) H & E Equipment, 8) Herc Rentals, 9) Home Depot, 10) Mobile Mini, 11) Sunstate Equipment, 12) Sunbelt Rentals, 13) Synergy Equipment, 14) any company on the “RER 100” list, and 15) any affiliate or dealer of any of the foregoing;

(B) any entity which at any time during the term of Employee’s employment was a candidate for acquisition by or merger with the Company (provided Employee was aware of the possibility of such acquisition or merger) ; and

(C) any entity which owns or owned any assets or facility which were acquired by the Company (provided Employee was involved in or otherwise related to such acquisition).

(b) During his or her employment by the Company and for a period of 12 months immediately following the termination of Employee’s employment for any reason whatsoever, whether or not for cause or by resignation, Employee will not anywhere directly or indirectly (whether as an owner, partner, employee, consultant, broker, contractor or otherwise, and whether personally or through other persons):

(i) solicit or accept the business of, call upon, contact, or communicate with any person or entity, or affiliate of any such person or entity, who or which is or was a customer, business prospect or other person who had a business relationship with the Company resulting in and/or for the purpose of providing or obtaining any product or service reasonably deemed competitive with any product or service then offered by the Company; provided, however, that this limitation shall apply only with respect to persons or entities with whom Employee had a business relationship, with whom Employee communicated, with whom Employee transacted business, or about whom Employee had Confidential Information while employed by the Company;

(ii) approve, solicit or retain, or discuss the employment or retention (whether as an employee, consultant or otherwise) of any person who was an employee of the Company at any time during the one year period preceding the termination of Employee’s employment by the Company. Nothing in this section restricts employees from engaging in protected activities with other employees concerning their wages, hours, and working conditions as set forth in Section 7 of the National Labor Relations Act;

(iii) solicit or encourage any person to leave the employ of the Company;

(iv) call upon or assist in the acquisition of any company which was, during the one-year period preceding the termination of Employee’s employment by the Company, the target of possible acquisition by the Company (provided Employee was aware of the possible acquisition); or

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(v) own any interest in or be employed by or provide any services to any person or entity which engages in any conduct which is prohibited to Employee under this Section 3(b) (this provision shall not prohibit Employee’s ownership of less than 5% of the outstanding common stock of a publicly-traded company).

(c) Before taking any position with any person or entity during the 12 month period following the termination of his or her employment for any reason, with or without cause or by resignation, Employee will give prior written notice to the Company of the name of such person or entity, as well as the assigned location, duties and responsibilities related to the position under consideration by Employee. Employee understands and expressly agrees that the obligation to provide written notice under this Section 3(c) is a material term of this Agreement, and that the failure to provide such notice shall be a material breach of this Agreement, and shall constitute a presumption that any employment about which he or she failed to give notice violates Section 3(a) and/or would necessarily result in a violation of Section 3(b) of this Agreement. Irrespective of whether such notice is given, the Company shall be entitled to advise any person or entity of the provisions of this Agreement, and to correspond and otherwise deal with any person or entity to ensure that the provisions of this Agreement are enforced and duly discharged. Employee acknowledges that Employee has not signed a confidentiality, non-competition or non-solicitation agreement with any former employer that by its terms remains in effect.

(d) All time periods in Section 3 of this Agreement shall be computed by excluding from such computation any time during which Employee is in violation of any provision of this Agreement and any time during which there is pending in any court of competent jurisdiction any action (including any appeal from any final judgment) brought by any person, whether or not a party to this Agreement, in which action the Company seeks to enforce the agreements and/or covenants in this Agreement or in which any person contests the validity of such agreements and/or covenants or their enforceability or seeks to avoid their performance or enforcement.

(e) Employee understands that the provisions of this Agreement have been carefully designed to restrict his or her activities to the minimum extent that is consistent with law and the Company's legitimate interests. Employee has carefully considered these restrictions, and Employee confirms that they are reasonable in both duration and geographic scope and will not unduly restrict Employee’s ability to obtain a livelihood. Employee has heretofore engaged in businesses other than the business in which Employee will be engaged on behalf of the Company. Employee acknowledges and agrees that Employee has had the opportunity to discuss this Agreement and all of its terms with Employee’s attorney before signing this Agreement.

(f) Employee acknowledges that monetary damages will be inadequate and the Company will be irreparably damaged if the provisions of this Agreement are not specifically enforced. Employee agrees that, in the event of a breach or threatened breach of this Agreement, the Company shall be entitled, among other remedies (i) to an injunction temporarily, preliminarily, and/or permanently restraining any violation of this Agreement (without any bond or other security being required) by Employee and by any person or entity to whom Employee provides or proposes to provide any services in violation of this Agreement, (ii) to require Employee to hold in a constructive trust, account for and pay over to the Company all compensation and other benefits which Employee shall derive as a result of any action or omission which is a violation of any provision of this Agreement and (iii) to require Employee to account for and pay over to the Company any net profit earned by the Employee from the exercise and/or vesting, during the 24-month period prior to the termination of his or her employment, of any stock options and/or restricted stock issued to him/her by the Company.

(g) The terms and provisions of this Section 3 are intended to be separate and divisible provisions and if, for any reason, any one or more of them is held to be invalid or unenforceable, neither the validity nor the enforceability of any other provision of this Agreement will thereby be affected. The courts enforcing this Agreement shall be entitled to reform or modify the duration, scope or other provision of any restriction contained herein to the extent such restriction would otherwise be unenforceable, and such restriction as reformed/modified shall be enforced.

3.1    Salary Continuation Payments.

(a) In the event Employee’s employment was terminated by the Company without “cause” (as defined below), then, for a period of 12 months following termination of employment, the Company shall pay to Employee every two weeks 1/26th of Employee’s Compensation paid to Employee by the Company during the 12 month period immediately preceding termination of his or her employment (as applicable, the “Salary Continuation Payments”); provided, however, all Salary Continuation Payments are conditioned upon Employee’s execution of a separation agreement and general release, in such form as the Company in its sole discretion determines. The Company shall provide Employee with the proposed form of separation agreement and general release no later than seven (7) days following the date of termination, and Employee shall execute and cause to become irrevocable such release no later than fifty-two (52) days after the date of termination. In the event Employee

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fails to execute the aforementioned separation agreement and general release, or Employee at any time breaches any of the terms of this Agreement, the provisions of this Agreement shall remain in effect for the full terms specified herein, including any applicable tolling period provided under Section 3(d), except that the Company shall not be obligated to, or shall no longer be obligated to, provide to Employee the Salary Continuation Payments. Payments by the Company to the Employee, if any, shall be subject to the same withholding as applied during the Employee’s employment.

(b) As used in this Section 3.1, “Employee’s Compensation,” for any period, shall be limited to only the Employee’s base salary. For sales employees only, who received more compensation in the form of commissions than base salary during the 12 month period immediately preceding termination, both Employee’s base salary and commissions shall be included in determining Employee’s Compensation.

(c) As used in this Section 3.1, “cause” shall mean the occurrence of any of the following events as solely determined by the Company: (i) the Employee has misappropriated any funds or property of the Company, or has willfully or negligently destroyed property of the Company; (ii) the Employee has been convicted of any crime that impairs the Employee’s ability to perform his or her duties and responsibilities with the Company, or that causes or may cause damage to the Company or its operations or reputation, or that involves fraud, embezzlement or moral turpitude; (iii) the Employee has (a) obtained personal profit from any transaction of or involving the Company (or engaged in any activity with the intent of obtaining such a personal profit) without the prior written approval of the Company or (b) engaged in any other conduct which constitutes a breach of fiduciary duty or the duty of loyalty to the Company and which has resulted or may result in damage to the Company; (iv) the Employee’s job performance is unsatisfactory; (v) the Employee has engaged in on-the-job conduct that falls below the standards the Company may reasonably expect; (vi) the Employee’s use of alcohol or drugs has interfered with his or her ability to perform his or her duties and responsibilities with the Company; (vii) the Employee has knowingly made any untrue statement or omission on or in support of the Employee’s application for employment with the Company, regardless of when discovered; (viii) the Employee has falsified Company records; (ix) the Employee has an unsatisfactory record of tardiness and/or attendance; (x) the Employee has committed any act intended to damage the reputation of the Company or which, in fact, damages the reputation of the Company; (xi) the Employee has disclosed to any unauthorized person any confidential or proprietary information, records, data, formulae, specifications or trade secrets or other information of value to the Company; (xii) the Employee has (a) violated the Company’s policies or rules (including, but not limited to, the Company’s equal employment opportunity policies) or (b) is guilty of negligence or misconduct in the performance of his or her duties with the Company; or (xiii) the Employee has given notice or other indication of Employee’s intent to resign, to seek employment with a competitor, and/or to take any action that might injure, damage, or irreparably harm the Company or which could lead to the unauthorized use or disclosure of the Company’s Trade Secrets or Confidential Information.

3.2    Section 409A

(a) The Company makes no representations regarding the tax implications of any compensation, payments and/or benefits to be paid to Employee under the Employment Agreement, including, without limitation, under Section 409A of the Internal Revenue Code (the “Code”). (Nothing in this Section 3.2 shall be construed as creating a right to any compensation, payments and/or benefits). Employee is advised to consult with a tax attorney/advisor regarding any tax implications. In the event the Company and Employee agree that the terms hereof would result in Employee being subject to tax under Section 409A of the Code, Employee and the Company shall negotiate in good faith to amend the Employment Agreement to the extent necessary to prevent the assessment of any such tax, including by delaying the payment dates of any amounts hereunder. If for any reason, such as imprecision in drafting, any provision of the Employment Agreement (or of any award of compensation, including, without limitation, equity compensation or benefits) does not accurately reflect its intended establishment of an exemption from (or compliance with) Code Section 409A, as demonstrated by consistent interpretations or other evidence of intent, such provision shall be considered ambiguous as to its exemption from (or compliance with) Code Section 409A and shall be interpreted by the Company in a manner consistent with such intent.

(b) To the extent that the right to any payment (including the provision of benefits) under the Employment Agreement provides for deferred compensation within the meaning of Code Section 409A that is not exempt from Code Section 409A as involuntary separation pay or a short-term deferral (or otherwise), a termination of employment shall not be deemed to have occurred for purposes of any provision of the Employment Agreement providing for any payment or benefits upon or following a termination of employment unless such termination is also a “separation from service” within the meaning of Code Section 409A and, for purposes of any such provision, references to a “termination,” “termination of employment,” or like terms shall mean “separation from service”.

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(c) In addition, notwithstanding any provision to the contrary in the Employment Agreement, if Employee is deemed on the date of Employee’s “separation from service” (within the meaning of Code Section 409A) to be a “specified employee” (within the meaning of Code Section 409A), then with regard to any payment that is required to be delayed pursuant to Code Section 409A(a)(2)(B), such payment shall not be made prior to the earlier of (i) the expiration of the six (6) month period measured from the date of his or her “separation from service” and (ii) the date of his or her death. Each payment under the Employment Agreement shall be treated as a separate payment for purposes of Code Section 409A. In no event may Employee, directly or indirectly, designate the calendar year of any payment to be made under the Employment Agreement.

(d) All reimbursements and in-kind benefits provided under the Employment Agreement that constitute deferred compensation within the meaning of Section 409A of the Code shall be made or provided in accordance with the requirements of Section 409A of the Code, including, without limitation, that (i) subject to any shorter time periods provided herein, in no event shall such reimbursements and payments by the Company under the Employment Agreement be made later than the end of the calendar year next following the calendar year in which the applicable fees and expenses were incurred; (ii) the amount of such reimbursements, payments and in-kind benefits that the Company is obligated to pay or provide in any given calendar year shall not affect the reimbursements and in-kind benefits that the Company is obligated to pay or provide in any other calendar year (except that a plan providing medical or health benefits may impose a generally applicable limit on the amount that may be reimbursed or paid); (iii) Employee’s right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit; and (iv) in no event shall the Company’s obligations to make such reimbursements or to provide such in-kind benefits apply later than Employee’s remaining lifetime (or if longer, through the 20th anniversary of the effective date of the Employment Agreement).

4.    Inventions and Intellectual Property. Employee shall promptly disclose to the Company any and all conceptions and ideas for inventions, improvements and valuable discoveries, whether patentable or not, which are conceived or made by Employee, solely or jointly with another, during or after regular hours of employment, during the period of employment or within one year thereafter, and which are related to the business or activities of the Company or which Employee conceives as a result of his or her employment by the Company, and Employee hereby assigns and agrees to assign all Employee’s interests therein to the Company or its nominee. Employee also agrees that all works created by him/her are considered work made for hire and prepared by Employee within the scope of his/her employment by the Company and Employee further agrees to assign, and hereby does assign automatically, all such future work to the Company. Whenever requested to do so by the Company, Employee shall execute any and all applications, assignments or other instruments that the Company shall deem necessary to apply for and obtain any patent or copyright in the United States or any foreign country or to otherwise protect the Company's interest therein. These obligations shall continue beyond the termination of employment with respect to inventions, improvements and valuable discoveries, whether patentable or not, conceived, made or acquired by Employee during the period of employment or within one year thereafter, and shall be binding upon Employee’s assigns, executors, administrators and other legal representatives.

5.    Jurisdiction, Arbitration & Attorneys’ Fees.

(a) Consent to Personal Jurisdiction. Employee hereby agrees that the interpretation and enforcement of the provisions of this Agreement shall be resolved and determined exclusively by the state court sitting in Fairfield County, Connecticut or the federal courts in the District of Connecticut and Employee hereby consents that such courts be granted exclusive jurisdiction for such purpose. Employee hereby acknowledges that, in the performance of his or her duties, Employee will maintain significant contacts with the Company’s corporate offices and/or infrastructure in Connecticut, including, without limitation, telephone and email contacts with corporate personnel, access to corporate databases and other data and intellectual property maintained in Connecticut, required attendance at certain training and/or strategic meetings, and payment of business related travel and entertainment expenses.

(b) Waiver of Jury Trial. Employee and the Company hereby waive a trial by jury in all legal disputes brought pursuant to this Agreement.

(c) Waiver of Service. Employee agrees to waive formal service of process under any applicable federal or state rules of procedure. Service of process shall be effective when given in the manner provided for notices hereunder.

(d) Arbitration of Certain Claims by Employee.

(i) Any and all claims by Employee relating to any matter arising during or after the employment of the Employee by Company or in connection with the cessation of said employment shall be resolved exclusively by arbitration conducted by one arbitrator in accordance with the Employment Arbitration Rules and Mediation Procedures established by the American Arbitration Association (AAA). The Company will provide a copy of these Rules to Employee on request. The decision of the arbitrator

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will be final and binding on both parties. (Note that this arbitration provision shall not apply to any claims by the Company against Employee or any matters within the scope of Section 5(a)).

(ii) The claims and disputes to be arbitrated under this Section 5(d) (“Arbitrable Claims”) include, without limitation, disputes or claims arising under (A) federal, state, and local statutory or common law (examples include, but are not limited to, the Age Discrimination in Employment Act, Title VII of the Civil Rights Act, and the Americans with Disabilities Act), (B) the law of contract and (C) the law of tort.

(iii) Each Arbitrable Claim shall automatically expire unless Employee begins arbitration for the claim no later than the first anniversary of the day on which the Employee learned or reasonably should have learned that he or she may have such claim.

(iv) No Arbitrable Claim may be initiated or maintained on a putative or certified class, collective or multi-party action basis either in a court or in Arbitration. Any Arbitrable Claim purporting to be brought as a putative or certified class, collective or multi-party action basis will be decided under these rules as an individual claim in Arbitration.

(v) No language in this document is intended to limit in any way Employee’s rights under the National Labor Relations Act (“NLRA”), and any claims under the NLRA are specifically excluded from the arbitration provisions described above.

(e) Attorneys’ Fees. If Employee breaches any of the covenants set forth in this Agreement, or brings any action challenging this Agreement or its enforcement, Employee agrees to pay all costs (including reasonable attorneys’ fees) incurred by the Company in establishing that breach and/or in otherwise defending or enforcing any of the covenants or provisions of this Agreement.

6.    Suits Against Company.

(a) Both during and after the term of employment hereunder, Employee covenants that Employee will not bring suit or file counterclaims against the Company, for corporate misconduct (which for this purpose does not mean matters for which Employee has a personal claim against the Company in his or her capacity as an employee), unless both of (i) and (ii) shall have occurred, namely:

(i) Employee shall have first made written demand to the Company's Board of Directors to investigate and deal with such misconduct, and

(ii) The Board of Directors shall have failed within 45 days after the date of receipt of such demand to establish a Special Litigation Committee, consisting exclusively of outside directors, to investigate and deal with such misconduct.

(b) Without limiting the generality of and to further implement the foregoing, Employee irrevocably and unconditionally consents at the option of the Company to the entry of temporary restraining orders and temporary and permanent injunctions (without posting bond or other security) against the filing of any action or counterclaim that is prohibited hereunder.

(c) The opinion of the Board of Directors shall be binding and conclusive on the determination of which directors constitute "outside directors," and the determination of the Special Litigation Committee shall be binding and conclusive on all matters relating to the actual or alleged misconduct which is referred to it as aforesaid.

7.    Cooperation in Proceedings. During and after the termination of Employee’s employment, Employee will cooperate fully at reasonable times with the Company in all litigations, investigations, and/or regulatory proceedings on which the Company seeks Employee’s assistance and as to which Employee has any knowledge or involvement. Without limiting the generality of the foregoing, Employee will testify at such litigations and other proceedings, and will cooperate with counsel to the Company in preparing materials and providing information regarding such matters. Except as required by law and/or related to an investigation by a government agency, Employee will not in any way cooperate or assist any person or entity in any matter which is adverse to the Company. Employee understands that nothing in this Agreement shall limit Employee’s rights under applicable law to provide truthful information to any governmental entity or to file a charge with or participate in an investigation conducted by any governmental entity or from cooperating with any government investigation, making a truthful statement or complaint to law enforcement or a government agency, testifying under oath to law enforcement or a government agency, or from complying with a properly-served and lawfully-issued subpoena or similar order issued by a government agency or court of competent jurisdiction.

8.    Non-Disparagement. Except as may be compelled by law or as authorized in writing by the Company, during and at all times after Employee’s employment with the Company, Employee shall not make any oral or written defamatory or recklessly

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malicious statements, or take any actions, which could disparage or denigrate the Company or its current or former officers, directors, employees, products or services.

9.    Miscellaneous.

(a) This Agreement is not a promise of employment. There are no oral representations, understandings or agreements with the Company or any of its officers, directors or employees covering the same subject matter as this Agreement. This written Agreement is the final, complete and exclusive statement and expression of the agreement between the Company and Employee and of all the terms of this Agreement, it cancels and supersedes all prior agreements with respect to the subject matter hereof, and it cannot be modified, varied, contradicted or supplemented by evidence of any prior, contemporaneous or subsequent oral agreement(s), or any prior written agreement(s). Notwithstanding the foregoing, in the case of any Restricted Stock Unit Agreement (“RSU Agreement”) between Employee and the Company, Employee understands that any post-employment obligations contained in such RSU Agreement(s) are independent of and in addition to those contained in this Agreement. Employee also understands and agrees that Employee’s role, responsibilities, and terms of employment may change over time, and that any such change will not affect the validity or enforceability of this Agreement. This written Agreement may not be later modified, varied, contradicted, or supplemented except by a further writing signed by the Company and Employee, and no term of this Agreement may be waived except by a writing signed by the party waiving the benefit of such terms.

(b) No waiver by the parties hereto of any default or breach of any term, condition or covenant of this Agreement shall be deemed to be a waiver of any subsequent default or breach of the same or any other term, condition or covenant contained herein. This Agreement is intended, among other things, to supplement the applicable common and/or statutory laws and does not in any way abrogate any of the obligations or duties Employee otherwise owes to the Company.

(c) This Agreement shall be binding upon and inure to the benefit of the parties named herein and their respective heirs, legal representatives, successors and permitted assigns. Employee may not assign either this Agreement or any of Employee’s rights, interests or obligations hereunder. Employee hereby agrees and acknowledges that the Company may assign any or all of its rights and interest hereunder, including, but not limited to, Employee’s agreements contained in Section 2 and Section 3 hereof, without the consent of Employee, to any person or entity that acquires any of the assets of the Company, or to any affiliate of the Company, or to any entity with which the Company merges or consolidates.

(d) Whenever any notice is required hereunder, it shall be given in writing addressed as follows:

To the Company:            100 First Stamford Place - Suite 700

Stamford, CT 06902                

Attn: Human Resources Department

To Employee: To the home address Employee last provided to the Company’s Human Resources department

Notice shall be deemed effective: (a) five business days after the document is deposited in the U.S. mail (provided it is sent via first class mail, certified, return receipt requested); (b) one business day after the document is delivered to a nationally recognized air courier for next day delivery; and/or (c) upon personal delivery. Either party may change the address for notice by notifying the other party of such change in accordance with this paragraph. Any failure by Employee to update his or her address shall not impact the validity of any Notice, provided it is given in the manner prescribed in this subsection.

(e) This Agreement contains independently-enforceable obligations. If any section, provision or clause of this Agreement, or any portion thereof, is held void or unenforceable, the remainder of such section, provision or clause, and all other sections, provisions or clauses of this Agreement, shall remain in full force and effect as if the section, provision or clause determined to be void or unenforceable had not been contained herein. The paragraph headings herein are for reference purposes only and are not intended in any way to describe, interpret, define or limit the extent or intent of this Agreement or any part hereof.

(f) All rights and remedies of either party expressly set forth herein are intended to be cumulative and not in limitation of any other right or remedy set forth herein or otherwise available to such party at law or in equity. Notwithstanding the foregoing, in no event shall the Company be liable to Employee for consequential or punitive damages, except as specifically provided in this Agreement.

(g) This Agreement shall in all respects be construed according to the laws of the State of Connecticut, without regard to its conflict of laws principles.

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(h) This Agreement may be executed digitally, electronically and/or by facsimile, and may be transmitted digitally, electronically, and/or by facsimile, in any number of counterparts, each of which upon execution and delivery shall be considered an original for all purposes; provided, however, all such counterparts shall, together, upon execution and delivery, constitute one and the same instrument. 

UNITED RENTALS, INC.                    EMPLOYEE:

BY: /s/ Craig A. Pintoff/s/ Andrew Limoges

ANDREW LIMOGES

NAME: Craig A. Pintoff

TITLE: EVP, Chief Administrative and Legal Officer

UNITED RENTALS (NORTH AMERICA), INC.

BY: /s/ Craig A. Pintoff

NAME: Craig A. Pintoff

TITLE: EVP, Chief Administrative and Legal Officer

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EX-12

Exhibit 12

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(In millions, except ratios)

	Year Ended December 31,															Nine Months Ended September 30,
	2013			2014			2015			2016			2017			2018
Earnings:
Income before provision for income taxes	$	605		$	850		$	963		$	909		$	1,048		$	1,051
Add:
Fixed charges, net of capitalized interest	521			520			492			461			465			382
Total earnings available for fixed charges	1,126			1,370			1,455			1,370			1,513			1,433
Fixed charges (1):
Interest expense, net	475			555			567			511			464			339
Add back interest income, which is netted in interest expense	1			2			2			2			2			1
Add back losses on bond repurchases/retirement of subordinated convertible debentures, included in interest expense	(3		)	(80		)	(123		)	(101		)	(54		)	—
Interest expense—subordinated convertible debentures	3			—			—			—			—			—
Capitalized interest	—			—			—			—			—			—
Interest component of rent expense	45			43			46			49			53			42
Fixed charges	$	521		$	520		$	492		$	461		$	465		$	382
Ratio of earnings to fixed charges	2.2x			2.6x			3.0x			3.0x			3.3x			3.8x

_________________

(1) Fixed charges consist of interest expense, which includes amortization of deferred finance charges, interest expense-subordinated debentures, capitalized interest and imputed interest on our lease obligations. The interest component of rent was determined based on an estimate of a reasonable interest factor at the inception of the leases.

EX-31.A

Exhibit 31(a)

CERTIFICATIONS

I, Michael J. Kneeland, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Rentals, Inc. and United Rentals (North America), Inc. for the quarterly period ended September 30, 2018;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrants as of, and for, the periods presented in this report;

4. The registrants' other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrants and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrants, including their consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrants' disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and.

d) disclosed in this report any change in the registrants' internal control over financial reporting that occurred during the registrants' most recent fiscal quarter (the registrants' fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants' internal control over financial reporting; and

5. The registrants' other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants' auditors and the audit committee of the registrants' board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants' ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants' internal control over financial reporting.

/S/    MICHAEL J. KNEELAND        

Michael J. Kneeland

Chief Executive Officer

October 17, 2018

EX-31.B

Exhibit 31(b)

CERTIFICATIONS

I, Jessica T. Graziano, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Rentals, Inc. and United Rentals (North America), Inc. for the quarterly period ended September 30, 2018;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrants as of, and for, the periods presented in this report;

4. The registrants' other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrants and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrants, including their consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrants' disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and.

d) disclosed in this report any change in the registrants' internal control over financial reporting that occurred during the registrants' most recent fiscal quarter (the registrants' fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants' internal control over financial reporting; and

5. The registrants' other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants' auditors and the audit committee of the registrants' board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants' ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants' internal control over financial reporting.

/S/    JESSICA T. GRAZIANO 

Jessica T. Graziano

Chief Financial Officer

October 17, 2018

EX-32.A

Exhibit 32(a)

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of United Rentals, Inc. and United Rentals (North America), Inc. (the “Companies”) on Form 10-Q for the quarterly period ended September 30, 2018 as filed with the Securities and Exchange Commission (the “Report”), I, Michael J. Kneeland, Chief Executive Officer of the Companies, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m); and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Companies.

/S/    MICHAEL J. KNEELAND        

Michael J. Kneeland

Chief Executive Officer

October 17, 2018

EX-32.B

Exhibit 32(b)

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of United Rentals, Inc. and United Rentals (North America), Inc. (the “Companies”) on Form 10-Q for the quarterly period ended September 30, 2018 as filed with the Securities and Exchange Commission (the “Report”), I, Jessica T. Graziano, Chief Financial Officer of the Companies, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m); and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Companies.

/S/    JESSICA T. GRAZIANO

Jessica T. Graziano

Chief Financial Officer

October 17, 2018

XML

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 15, 2018
Document And Entity Information [Abstract]
Entity Registrant Name	UNITED RENTALS INC /DE
Entity Central Index Key	0001067701
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Common Stock, Shares Outstanding		81,102,622

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
ASSETS
Cash and cash equivalents	$ 65	$ 352
Accounts receivable, net of allowance for doubtful accounts of $77 at September 30, 2018 and $68 at December 31, 2017	1,438	1,233
Inventory	104	75
Prepaid expenses and other assets	85	112
Total current assets	1,692	1,772
Rental equipment, net	8,910	7,824
Property and equipment, net	529	467
Goodwill	4,313	4,082
Other intangible assets, net	895	875
Other long-term assets	15	10
Total assets	16,354	15,030
LIABILITIES AND STOCKHOLDERS’ EQUITY
Short-term debt and current maturities of long-term debt	896	723
Accounts payable	688	409
Accrued expenses and other liabilities	503	536
Total current liabilities	2,087	1,668
Long-term debt	9,182	8,717
Deferred taxes	1,628	1,419
Other long-term liabilities	123	120
Total liabilities	13,020	11,924
Common stock—$0.01 par value, 500,000,000 shares authorized, 112,874,448 and 81,537,040 shares issued and outstanding, respectively, at September 30, 2018 and 112,394,395 and 84,463,662 shares issued and outstanding, respectively, at December 31, 2017	1	1
Additional paid-in capital	2,380	2,356
Retained earnings	3,791	3,005
Treasury stock at cost—31,337,408 and 27,930,733 shares at September 30, 2018 and December 31, 2017, respectively	(2,660)	(2,105)
Accumulated other comprehensive loss	(178)	(151)
Total stockholders’ equity (deficit)	3,334	3,106
Total liabilities and stockholders’ equity (deficit)	$ 16,354	$ 15,030

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 77	$ 68
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	112,874,448	112,394,395
Common stock, shares outstanding	81,537,040	84,463,662
Treasury stock, shares	31,337,408	27,930,733

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenues:
Equipment rentals	$ 1,861	$ 1,536	$ 4,951	$ 4,069
Service and other revenues	37	30	106	86
Total revenues	2,116	1,766	5,741	4,719
Cost of revenues:
Cost of equipment rentals, excluding depreciation	671	557	1,883	1,556
Depreciation of rental equipment	343	290	988	804
Cost of service and other revenues	20	14	58	42
Total cost of revenues	1,178	993	3,375	2,777
Gross profit	938	773	2,366	1,942
Selling, general and administrative expenses	265	237	736	648
Merger related costs	11	16	14	32
Restructuring charge	9	9	15	28
Non-rental depreciation and amortization	75	63	213	189
Operating (loss) income	578	448	1,388	1,045
Interest expense, net	118	131	339	338
Other income, net	0	(5)	(2)	(5)
Income before provision for income taxes	460	322	1,051	712
Provision for income taxes	127	123	265	263
Net income	$ 333	$ 199	$ 786	$ 449
Basic earnings per share (in dollars per share)	$ 4.05	$ 2.36	$ 9.44	$ 5.31
Diluted earnings per share (in dollars per share)	$ 4.01	$ 2.33	$ 9.34	$ 5.26
Rental equipment
Revenues:
Sales revenue	$ 140	$ 139	$ 478	$ 378
Cost of revenues:
Cost of goods sold	83	84	282	225
New equipment
Revenues:
Sales revenue	54	40	140	126
Cost of revenues:
Cost of goods sold	46	34	121	108
Contractor supplies
Revenues:
Sales revenue	24	21	66	60
Cost of revenues:
Cost of goods sold	$ 15	$ 14	$ 43	$ 42

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Net income		$ 333	$ 199	$ 786	$ 449
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments		18	41	(28)	75
Fixed price diesel swaps		0	1	1	0
Other comprehensive (loss) income		18	42	(27)	75
Comprehensive income (loss)	[1]	$ 351	$ 241	$ 759	$ 524

[1] There were no material reclassifications from accumulated other comprehensive loss reflected in other comprehensive income (loss) during 2018 or 2017. There is no tax impact related to the foreign currency translation adjustments, as the earnings are considered permanently reinvested. There were no material taxes associated with other comprehensive income (loss) during 2018 or 2017.

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Parenthetical) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Reclassifications from accumulated other comprehensive income reflected in other comprehensive income	$ 0	$ 0	$ 0	$ 0
Tax impact related to foreign currency translation adjustments	0	0	0	0
Taxes associated with other comprehensive income	$ 0	$ 0	$ 0	$ 0

XML

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (UNAUDITED) - 9 months ended Sep. 30, 2018 - USD ($) shares in Millions, $ in Millions		Total	Common Stock		Additional Paid-in Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive Loss	[2]
Balance (shares) at Dec. 31, 2017			84	[1]			(28)
Balance at Dec. 31, 2017		$ 3,106	$ 1		$ 2,356	$ 3,005	$ (2,105)	$ (151)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income		786				786
Foreign currency translation adjustments		(28)						(28)
Fixed price diesel swaps		1						1
Stock compensation expense, net (in shares)	[1]		1
Stock compensation expense, net					73
Exercise of common stock options					2
Shares repurchased and retired					(51)
Repurchase of common stock (in shares)			(3)	[1]			3
Repurchase of common stock							$ (555)
Balance (shares) at Sep. 30, 2018			82	[1]			(31)
Balance at Sep. 30, 2018		$ 3,334	$ 1		$ 2,380	$ 3,791	$ (2,660)	$ (178)

[1] Common stock outstanding increased by less than 1 million net shares during the year ended December 31, 2017.

[2] The Accumulated Other Comprehensive Loss balance primarily reflects foreign currency translation adjustments.

XML

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) shares in Millions	12 Months Ended
	Dec. 31, 2017 shares
Common Stock
Increase in common stock outstanding (in shares, less than)	1

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash Flows From Operating Activities:
Net income	$ 786	$ 449
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,201	993
Amortization of deferred financing costs and original issue discounts	9	6
Gain on sales of rental equipment	(196)	(153)
Gain on sales of non-rental equipment	(4)	(4)
Gain on insurance proceeds from damaged equipment	(18)	(10)
Stock compensation expense, net	73	64
Merger related costs	14	32
Restructuring charge	15	28
Loss on repurchase/redemption of debt securities and amendment of ABL facility	0	43
Increase in deferred taxes	190	97
Changes in operating assets and liabilities, net of amounts acquired:
Increase in accounts receivable	(131)	(172)
Increase in inventory	(23)	(9)
Decrease (increase) in prepaid expenses and other assets	31	(1)
Increase in accounts payable	238	350
(Decrease) increase in accrued expenses and other liabilities	(62)	43
Net cash provided by operating activities	2,123	1,756
Cash Flows From Investing Activities:
Purchases of rental equipment	(1,962)	(1,485)
Purchases of non-rental equipment	(134)	(87)
Proceeds from sales of rental equipment	478	378
Proceeds from sales of non-rental equipment	13	10
Insurance proceeds from damaged equipment	18	10
Purchases of other companies, net of cash acquired	(805)	(1,063)
Purchases of investments	(1)	(5)
Net cash used in investing activities	(2,393)	(2,242)
Cash Flows From Financing Activities:
Proceeds from debt	7,062	8,702
Payments of debt	(6,464)	(8,156)
Proceeds from the exercise of common stock options	2	1
Common stock repurchased	(606)	(26)
Payments of financing costs	(1)	(44)
Net cash (used in) provided by financing activities	(7)	477
Effect of foreign exchange rates	(10)	21
Net (decrease) increase in cash and cash equivalents	(287)	12
Cash and cash equivalents at beginning of period	352	312
Cash and cash equivalents at end of period	65	324
Supplemental disclosure of cash flow information:
Cash paid for income taxes, net	50	114
Cash paid for interest	$ 379	$ 305

XML

Organization, Description of Business and Basis of Presentation

9 Months Ended

Sep. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization, Description of Business and Basis of Presentation

Organization, Description of Business and Basis of Presentation

United Rentals, Inc. (“Holdings,” “URI” or the “Company”) is principally a holding company and conducts its operations primarily through its wholly owned subsidiary, United Rentals (North America), Inc. (“URNA”), and subsidiaries of URNA. Holdings’ primary asset is its sole ownership of all issued and outstanding shares of common stock of URNA. URNA’s various credit agreements and debt instruments place restrictions on its ability to transfer funds to its shareholder.

We rent equipment to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities in the United States, Canada and Europe. In addition to renting equipment, we sell new and used rental equipment, as well as related contractor supplies, parts and service.

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the accounting policies described in our annual report on Form 10-K for the year ended December 31, 2017 (the “2017 Form 10-K”) and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the 2017 Form 10-K.

In our opinion, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented have been made. Interim results of operations are not necessarily indicative of the results of the full year.

New Accounting Pronouncements

Leases. In March 2016, the Financial Accounting Standards Board (“FASB”) issued guidance ("Topic 842") to increase transparency and comparability among organizations by requiring (1) recognition of lease assets and lease liabilities on the balance sheet and (2) disclosure of key information about leasing arrangements. Some changes to the lessor accounting guidance were made to align both of the following: (1) the lessor accounting guidance with certain changes made to the lessee accounting guidance and (2) key aspects of the lessor accounting model with revenue recognition guidance. Topic 842 will be effective for fiscal years and interim periods beginning after December 15, 2018, and early adoption is permitted. A modified retrospective approach is required for adoption for all leases that exist at or commence after the date of initial application with an option to use certain practical expedients. We expect to use the package of practical expedients that allows us to not reassess: (1) whether any expired or existing contracts are or contain leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. We additionally expect to use the practical expedient that allows us to treat the lease and non-lease components of our leases as a single component for our real estate leases. We expect to adopt this guidance when effective, using the transition method that allows us to initially apply Topic 842 at the adoption date of January 1, 2019 and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption.

As discussed in note 2 to our condensed consolidated financial statements, most of our equipment rental revenues, which accounted for 86 percent of total revenues for the nine months ended September 30, 2018, will be accounted for under the current lease accounting standard ("Topic 840") until the adoption of Topic 842. We have tentatively concluded that no significant changes are expected to the accounting for most of our equipment rental revenues upon adoption of Topic 842.

Under Topic 842, our operating leases, which include both real estate and non-rental equipment, will result in lease assets and lease liabilities being recognized on the balance sheet. We lease a significant portion of our branch locations, and also lease other premises used for purposes such as district and regional offices and service centers. We expect that the quantification of the amount of the lease assets and lease liabilities that we will recognize on our balance sheet will take a significant amount of time given the size of our lease portfolio. While our review of the lessee accounting requirements of Topic 842 is ongoing, we believe that the impact on our balance sheet, while not currently estimable, will be significant.

Measurement of Credit Losses on Financial Instruments. In June 2016, the FASB issued guidance that will require companies to present assets held at amortized cost and available for sale debt securities net of the amount expected to be collected. The guidance requires the measurement of expected credit losses to be based on relevant information from past events, including historical experiences, current conditions and reasonable and supportable forecasts that affect collectibility. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2019 and early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Different components of the guidance require modified retrospective or prospective adoption. We are currently assessing whether we will early adopt, and the impact on our financial statements is not currently estimable as it will depend on market conditions and our forecast expectations upon, and following, adoption.

Simplifying the Test for Goodwill Impairment. In January 2017, the FASB issued guidance intended to simplify the subsequent accounting for goodwill acquired in a business combination. Prior guidance required utilizing a two-step process to review goodwill for impairment. A second step was required if there was an indication that an impairment may exist, and the second step required calculating the potential impairment by comparing the implied fair value of the reporting unit's goodwill (as if purchase accounting were performed on the testing date) with the carrying amount of the goodwill. The new guidance eliminates the second step from the goodwill impairment test. Under the new guidance, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and then recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value (although the loss should not exceed the total amount of goodwill allocated to the reporting unit). The guidance requires prospective adoption and will be effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption of this guidance is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We are currently assessing whether we will early adopt. The guidance is not expected to have a significant impact on our financial statements.

Derivatives and Hedging. In August 2017, the FASB issued guidance with the objective of improving the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. The guidance is additionally intended to simplify hedge accounting, and no longer requires separate measurement and reporting of hedge ineffectiveness. For cash flow and net investment hedges existing at the date of adoption, entities must apply a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retained earnings. The amended presentation and disclosure guidance is required prospectively. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2018, and early adoption is permitted. We are currently assessing whether we will early adopt. Given our currently limited use of derivative instruments, the guidance is not expected to have a significant impact on our financial statements.

Guidance Adopted in 2018

Revenue from Contracts with Customers. See note 2 to our condensed consolidated financial statements for a discussion of our revenue recognition accounting following our adoption in the first quarter of 2018 of FASB guidance addressing the principles for recognizing revenue.

Statement of Cash Flows. In 2018, we retrospectively adopted guidance that was issued to reduce the diversity in the presentation of certain cash receipts and cash payments presented and classified in the statement of cash flows. The guidance addresses the following specific cash flow issues: (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (6) distributions received from equity method investees, (7) beneficial interests in securitization transitions and (8) separately identifiable cash flows and application of predominance principle. The adoption of this guidance did not have a significant impact on our financial statements for the three and nine months ended September 30, 2018 or 2017.

Intra-Entity Transfers of Assets Other Than Inventory. In 2018, we adopted guidance that requires companies to recognize the income tax effects of intra-entity sales and transfers of assets other than inventory in the period in which the transfer occurs. The adoption of this guidance did not have a significant impact on our financial statements.

Clarifying the Definition of a Business. In 2018, we adopted guidance that was issued to clarify the definition of a business with the objective of assisting entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is intended to make determining when a set of assets and activities is a business more consistent and cost-efficient. The future impact of this guidance will depend on the nature of our future activities, and fewer transactions may be treated as acquisitions (or disposals) of businesses after adoption.

Stock Compensation: Scope of Modification Accounting. In 2018, we prospectively adopted guidance that was issued to provide clarity and reduce both the (1) diversity in practice and (2) cost and complexity when changing the terms or conditions of share-based payment awards. Under the updated guidance, a modification is defined as a change in the terms or conditions of a share-based payment award, and an entity should account for the effects of a modification unless all of the following are met:

1.The fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation techniques that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification.

2.The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified.

3.The classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.

The majority of our modifications relate to the acceleration of vesting conditions. The accounting for such modifications did not change under the adopted guidance, which did not have a significant impact on our financial statements.

Tax Cuts and Jobs Act

The Tax Cuts and Jobs Act (the "Tax Act") was enacted in December 2017. The Act reduced the U.S. federal corporate tax rate from 35 percent to 21 percent, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. As of December 31, 2017, we were able to determine a reasonable estimate of (1) the effects on our existing deferred tax balances and (2) the one-time transition tax. We recognized a provisional income tax benefit of $689 in the year ended December 31, 2017 associated with these items that we reasonably estimated. As of September 30, 2018, we have not changed the provisional estimate recognized in 2017 associated with the effects on our existing deferred tax balances. During the three and nine months ended September 30, 2018, we increased the estimated one-time transition tax by $6. The Tax Act subjects U.S. shareholders to a tax on global intangible low-taxed income (“GILTI”) earned by certain foreign subsidiaries. Entities can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred. Given the complexity of the GILTI provisions, we are still evaluating the tax impact and have not yet made the accounting policy election. As of September 30, 2018, we were able to reasonably estimate provisional adjustments, based on current year operations only, related to GILTI and recognized the immaterial adjustments in our financial statements. In all cases as it relates to the Tax Act, we will continue to refine our calculations as additional analysis is completed and as we gain a more thorough understanding of the tax law.

All amounts recognized associated with the Tax Act as of September 30, 2018 are provisional. Given the complexity of the Tax Act, we are still evaluating the tax impact. We expect to complete the accounting in the fourth quarter of 2018. As noted above, most of the impact of the Act was recognized in 2017, with $6 of additional expense recognized during the three and nine months ended September 30, 2018.

XML

Revenue Recognition

9 Months Ended

Sep. 30, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Revenue Recognition

Revenue Recognition

Adoption of Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”

In May 2014, and in subsequent updates, the FASB issued guidance ("Topic 606") to clarify the principles for recognizing revenue. Topic 606 is an update to Topic 605, which was the revenue recognition standard in effect through December 31, 2017. Topic 606 includes the required steps to achieve the core principle that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted Topic 606 on January 1, 2018, using the modified retrospective method. The adoption of Topic 606 did not result in any significant changes to our historic revenue accounting under Topic 605. Results for 2018 are presented under Topic 606, while results for 2017 continue to reflect our historic accounting under Topic 605. Because there were no significant changes to our revenue recognition accounting upon adoption of Topic 606, no changes to our historic financial statements were required, and no cumulative change to retained earnings was required.

We applied the Topic 606 practical expedient that allows entities to not restate contracts that begin and are completed within the same annual reporting period. No other practical expedients associated with the adoption of Topic 606 were applied. The only change to our revenue accounting upon adoption of Topic 606 pertains to sales of certain rental equipment. Prior to the adoption of Topic 606, certain sales of rental equipment were deferred until certain contingent future events occurred. Under Topic 606, we are no longer required to defer the revenue. The adoption of Topic 606 results in earlier recognition (primarily in the first quarter) of certain sales of rental equipment, but it does not impact total annual revenue because the contingencies that previously resulted in deferral under Topic 605 are always resolved within the same calendar year. During the three months ended September 30, 2017, we recognized $139 of sales of rental equipment under Topic 605. Under Topic 606, sales of rental equipment during the three months ended September 30, 2017 would have been $14 less because such sales would have been recognized prior to the three months ended September 30, 2017. During the nine months ended September 30, 2017, we recognized $378 of sales of rental equipment under Topic 605 and such amount does not differ materially from the amount that would have been recognized under Topic 606.

As discussed below, following the adoption of Topic 606, we recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840 (which addresses lease accounting. As discussed below, we expect to adopt an update to this standard on January 1, 2019). Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services.

As reflected below, most of our revenue is accounted for under Topic 840. Our contracts with customers generally do not include multiple performance obligations. For contracts with multiple Topic 606 performance obligations, we allocate revenue to each performance obligation using our best estimate of the standalone selling price for each performance obligation.

Nature of goods and services

In the following table, revenue is summarized by type and by the applicable accounting standard.

	Three Months Ended September 30,
			2018						2017
	Topic 840		Topic 606		Total		Topic 840		Topic 605		Total
Revenues:
Owned equipment rentals	$	1,589	$	—	$	1,589	$	1,320	$	—	$	1,320
Re-rent revenue	41		—		41		32		—		32
Ancillary and other rental revenues:
Delivery and pick-up	—		132		132		—		107		107
Other	78		21		99		61		16		77
Total ancillary and other rental revenues	78		153		231		61		123		184
Total equipment rentals	1,708		153		1,861		1,413		123		1,536
Sales of rental equipment	—		140		140		—		139		139
Sales of new equipment	—		54		54		—		40		40
Contractor supplies sales	—		24		24		—		21		21
Service and other revenues	—		37		37		—		30		30
Total revenues	$	1,708	$	408	$	2,116	$	1,413	$	353	$	1,766

	Nine Months Ended September 30,
			2018						2017
	Topic 840		Topic 606		Total		Topic 840		Topic 605		Total
Revenues:
Owned equipment rentals	$	4,260	$	—	$	4,260	$	3,508	$	—	$	3,508
Re-rent revenue	95		—		95		78		—		78
Ancillary and other rental revenues:
Delivery and pick-up	—		336		336		—		279		279
Other	198		62		260		160		44		204
Total ancillary and other rental revenues	198		398		596		160		323		483
Total equipment rentals	4,553		398		4,951		3,746		323		4,069
Sales of rental equipment	—		478		478		—		378		378
Sales of new equipment	—		140		140		—		126		126
Contractor supplies sales	—		66		66		—		60		60
Service and other revenues	—		106		106		—		86		86
Total revenues	$	4,553	$	1,188	$	5,741	$	3,746	$	973	$	4,719

Revenues by reportable segment and geographical market are presented in notes 4 and 11 of the condensed consolidated financial statements, respectively, using the revenue captions reflected in our condensed consolidated statements of operations. The majority of our revenue is recognized in our general rentals segment and in the U.S. (for the nine months ended September 30, 2018, 82 percent and 92 percent of total revenues, respectively), and, accordingly, we do not believe that presenting the revenue types above by reportable segment or geographical market would provide information that is material to investors. We believe that the disaggregation of our revenue from contracts to customers as reflected above, coupled with the further discussion below and the reportable segment and geographical market disclosures in notes 4 and 11, depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Lease revenues (Topic 840)

The accounting for the types of revenue that are accounted for under Topic 840 is discussed below. As discussed in note 1 to the condensed consolidated financial statements, we expect to adopt Topic 842, which is an update to Topic 840, on January 1, 2019. We have tentatively concluded that no significant changes are expected to our revenue accounting upon adoption of Topic 842.

Owned equipment rentals: Owned equipment rentals represent revenues from renting equipment that we own. We account for such rentals as operating leases.

We recognize revenues from renting equipment on a straight-line basis. Our rental contract periods are hourly, daily, weekly or monthly. By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day. The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days. This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply.

As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, we will have customers return equipment and be contractually required to pay us more than the cumulative amount of revenue recognized to date under the straight-line methodology. For instance, continuing the above example, if the customer rented the above piece of equipment on December 29 and returned it at the close of business on January 1, we would recognize incremental revenue on January 1 of $171.44 (in actual dollars, representing the difference between the amount the customer is contractually required to pay, or $300 at the weekly rate, and the cumulative amount recognized to date on a straight-line basis, or $128.56, which represents four days at $32.14 per day).

We record amounts billed to customers in excess of recognizable revenue as deferred revenue on our balance sheet. We had deferred revenue (associated with both Topic 840 and Topic 606/605) of $58 and $46 as of September 30, 2018 and December 31, 2017, respectively.

Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above.

“Other” equipment rental revenue is primarily comprised of 1) Rental Protection Plan (or "RPP") revenue associated with the damage waiver customers can purchase when they rent our equipment to protect against potential loss or damage, 2) environmental charges associated with the rental of equipment, and 3) charges for rented equipment that is damaged by our customers.

Revenues from contracts with customers (Topic 606)

The accounting for the types of revenue that are accounted for under Topic 606 is discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time.

Delivery and pick-up: Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed.

“Other” equipment rental revenue is primarily comprised of revenues associated with the consumption of fuel by our customers which are recognized when the equipment is returned by the customer (and consumption, if any, can be measured).

Sales of rental equipment, new equipment and contractor supplies are recognized at the time of delivery to, or pick-up by, the customer and when collectibility is reasonably assured.

Service and other revenues primarily represent revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). Service revenue is recognized as the services are performed.

Receivables and contract assets and liabilities

As reflected above, most of our equipment rental revenue is accounted for under Topic 840 (such revenue represented 79 percent of our total revenues for the nine months ended September 30, 2018). The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. Because the same customers generate the revenues that are accounted for under both Topic 606 and Topic 840, the discussions below on credit risk and our allowances for doubtful accounts address our total revenues from Topic 606 (Topic 605 for 2017) and Topic 840.

Concentration of credit risk with respect to our receivables is limited because a large number of geographically diverse customers makes up our customer base. Our largest customer accounted for less than one percent of total revenues for the nine months ended September 30, 2018, and for each of the last three full years. Our customer with the largest receivable balance represented approximately one percent of total receivables at September 30, 2018 and December 31, 2017. We manage credit risk through credit approvals, credit limits and other monitoring procedures.

We maintain allowances for doubtful accounts. These allowances reflect our estimate of the amount of our receivables that we will be unable to collect based on historical write-off experience. Our estimate could require change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowances. Trade receivables that have contractual maturities of one year or less are written-off when they are determined to be uncollectible based on the criteria necessary to qualify as a deduction for federal tax purposes. Write-offs of such receivables require management approval based on specified dollar thresholds. During the nine months ended September 30, 2018 and 2017, we recognized expenses of $27 and $24, respectively, primarily within selling, general and administrative expenses in our condensed consolidated statements of income, associated with our allowances for doubtful accounts.

We do not have material contract assets, or impairment losses associated therewith, or material contract liabilities, associated with contracts with customers. Our contracts with customers do not generally result in material amounts billed to customers in excess of recognizable revenue. We did not recognize material revenue during the three or nine months ended September 30, 2018 or 2017 that was included in the contract liability balance as of the beginning of such periods.

Performance obligations

Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the three and nine months ended September 30, 2018 and 2017 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2018.

Payment terms

Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk.

Sales tax amounts collected from customers are recorded on a net basis.

Contract costs

We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.

Contract estimates and judgments

Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments, primarily for the following reasons:

• The transaction price is generally fixed and stated on our contracts;

• As noted above, our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation;

• Our revenues do not include material amounts of variable consideration; and

• Most of our revenue is recognized as of a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenue is generally recognized at the time of delivery to, or pick-up by, the customer.

We monitor and review our estimated standalone selling prices on a regular basis.

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Acquisitions

9 Months Ended

Sep. 30, 2018

Business Combinations [Abstract]

Acquisitions

Acquisitions

NES Acquisition

In April 2017, we completed the acquisition of NES Rentals Holdings II, Inc. (“NES”). NES was a provider of rental equipment with 73 branches located throughout the eastern half of the U.S., and had approximately 1,100 employees and approximately $900 of rental assets at original equipment cost as of December 31, 2016. NES had annual revenues of approximately $369. The acquisition:

•Increased our density in strategically important markets, including the East Coast, Gulf States and the Midwest;

•Strengthened our relationships with local and strategic accounts in the construction and industrial sectors, which enhances cross-selling opportunities and drives revenue synergies; and

•Created meaningful opportunities for cost synergies in areas such as corporate overhead, operational efficiencies and purchasing.

The aggregate consideration paid to holders of NES common stock and options was approximately $960. The acquisition and related fees and expenses were funded through drawings on our senior secured asset-based revolving credit facility (“ABL facility”) and new debt issuances. 

The following table summarizes the fair values of the assets acquired and liabilities assumed.

Accounts receivable, net of allowance for doubtful accounts (1)	$	49
Inventory	4
Rental equipment	571
Property and equipment	48
Intangibles (2)	139
Other assets	7
Total identifiable assets acquired	818
Short-term debt and current maturities of long-term debt (3)	(3		)
Current liabilities	(33		)
Deferred taxes	(15		)
Long-term debt (3)	(11		)
Other long-term liabilities	(5		)
Total liabilities assumed	(67		)
Net identifiable assets acquired	751
Goodwill (4)	209
Net assets acquired	$	960

(1) The fair value of accounts receivables acquired was $49, and the gross contractual amount was $53. We estimated that $4 would be uncollectible.

(2) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	138	10
Non-compete agreements	1		1
Total	$	139

(3) The acquired debt reflects capital lease obligations.

(4) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of NES's going-concern value, the value of NES's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $1 of goodwill is expected to be deductible for income tax purposes.

The nine months ended September 30, 2018 and 2017 include NES acquisition-related costs which are included in “Merger related costs” in our condensed consolidated statements of income. In addition to the acquisition-related costs reflected in our condensed consolidated statements of income, the debt issuance costs and the original issue premiums associated with the issuance of debt to fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our condensed consolidated balance sheets.

Since the acquisition date, significant amounts of fleet have been moved between URI locations and the acquired NES locations, and it is not practicable to reasonably estimate the amounts of revenue and earnings of NES since the acquisition date. The impact of the NES acquisition on our equipment rentals revenue is primarily reflected in the increase in the volume of OEC on rent of 19.6 percent for the nine months ended September 30, 2018 (such increase also includes the impact of the acquisitions of Neff Corporation ("Neff") and BakerCorp International Holdings, Inc. (“BakerCorp”) discussed below).

Neff Acquisition

In October 2017, we completed the acquisition of Neff. Neff was a provider of earthmoving, material handling, aerial and other equipment, and had 69 branches located in 14 states, with a concentration in southern geographies. Neff had approximately 1,100 employees and approximately $860 of rental assets at original equipment cost as of September 30, 2017. Neff had annual revenues of approximately $413. The acquisition augmented our earthmoving capabilities and efficiencies of scale in key market areas, particularly fast-growing southern geographies, and created opportunities for revenue synergies through the cross-selling of our broader fleet.

The aggregate consideration paid to holders of Neff common stock and options was approximately $1.316 billion (including $7 of stock consideration associated with Neff stock options and restricted stock units which were converted into United Rentals stock options). The acquisition and related fees and expenses were primarily funded through new debt issuances. 

The following table summarizes the fair values of the assets acquired and liabilities assumed.

Accounts receivable, net of allowance for doubtful accounts (1)	$	72
Inventory	5
Rental equipment	550
Property and equipment	45
Intangibles (customer relationships) (2)	153
Other assets	5
Total identifiable assets acquired	830
Current liabilities	(62		)
Deferred taxes	(36		)
Other long-term liabilities	(3		)
Total liabilities assumed	(101		)
Net identifiable assets acquired	729
Goodwill (3)	587
Net assets acquired	$	1,316

(1) The fair value of accounts receivables acquired was $72, and the gross contractual amount was $74. We estimated that $2 would be uncollectible.

(2) The customer relationships are being amortized over a 10 year life.

(3) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of Neff's going-concern value, the value of Neff's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $320 of goodwill is expected to be deductible for income tax purposes.

The three and nine months ended September 30, 2018 and 2017 include Neff acquisition-related costs which are included in “Merger related costs” in our condensed consolidated statements of income. In addition to the acquisition-related costs reflected in our consolidated statements of income, the debt issuance costs and the original issue premiums associated with the issuance of debt to fund the acquisition are reflected, net of amortization subsequent to the acquisition date, in long-term debt in our condensed consolidated balance sheets.

Since the acquisition date, significant amounts of fleet have been moved between URI locations and the acquired Neff locations, and it is not practicable to reasonably estimate the amounts of revenue and earnings of Neff since the acquisition date. The impact of the Neff acquisition on our equipment rentals revenue is primarily reflected in the increases in the volume of OEC on rent of 17.8 percent and 19.6 percent for the three and nine months ended September 30, 2018, respectively. Such increase for the three months ended September 30, 2018 includes the impact of the acquisition of BakerCorp discussed below. Such increase for the nine months ended September 30, 2018 includes the impact of the acquisitions of NES discussed above and BakerCorp discussed below.

BakerCorp Acquisition

In July 2018, we completed the acquisition of BakerCorp. BakerCorp was a leading multinational provider of tank, pump, filtration and trench shoring rental solutions for a broad range of industrial and construction applications. BakerCorp had approximately 950 employees, and its operations were primarily concentrated in the United States and Canada, where it had 46 locations. BakerCorp also had 11 locations in France, Germany, the United Kingdom and the Netherlands. BakerCorp had annual revenues of approximately $295. The acquisition is expected to:

•Augment our bundled solutions for fluid storage, transfer and treatment;

•Expand our strategic account base; and

•Provide a significant opportunity to increase revenue and enhance customer service by cross-selling to our broader customer base.

The aggregate consideration paid was approximately $724. The acquisition and related fees and expenses were funded through drawings on our ABL facility.

The following table summarizes the fair values of the assets acquired and liabilities assumed. The purchase price allocations for these assets and liabilities are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period.

Accounts receivable, net of allowance for doubtful accounts (1)	$	73
Inventory	5
Rental equipment	352
Property and equipment	27
Intangibles (2)	149
Other assets	5
Total identifiable assets acquired	611
Current liabilities	(61		)
Deferred taxes	(20		)
Total liabilities assumed	(81		)
Net identifiable assets acquired	530
Goodwill (3)	194
Net assets acquired	$	724

(1) The fair value of accounts receivables acquired was $73, and the gross contractual amount was $79. We estimated that $6 would be uncollectible.

(2) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	144	8
Trade names and associated trademarks	5		5
Total	$	149

(3) All of the goodwill was assigned to our trench, power and fluid solutions segment. The level of goodwill that resulted from the acquisition is primarily reflective of BakerCorp's going-concern value, the value of BakerCorp's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that are not associated with the identifiable assets. $7 of goodwill is expected to be deductible for income tax purposes.

The three and nine months ended September 30, 2018 include BakerCorp acquisition-related costs which are included in “Merger related costs” in our condensed consolidated statements of income.

Since the acquisition date, significant amounts of fleet have been moved between URI locations and the acquired BakerCorp locations, and it is not practicable to reasonably estimate the amounts of revenue and earnings of BakerCorp since the acquisition date. The impact of the BakerCorp acquisition on our equipment rentals revenue is primarily reflected in the increases in the volume of OEC on rent of 17.8 percent and 19.6 percent for the three and nine months ended September 30, 2018, respectively. Such increase for the three months ended September 30, 2018 includes the impact of the acquisition of Neff discussed above. Such increase for the nine months ended September 30, 2018 includes the impact of the acquisitions of NES and Neff discussed above.

Pro forma financial information

The pro forma information below gives effect to the NES, Neff and BakerCorp acquisitions as if they had been completed on January 1, 2017 (“the pro forma acquisition date”). The pro forma information is not necessarily indicative of our results of operations had the acquisitions been completed on the above date, nor is it necessarily indicative of our future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, and also does not reflect additional revenue opportunities following the acquisitions. The pro forma information includes adjustments to record the assets and liabilities of NES, Neff and BakerCorp at their respective fair values based on available information and to give effect to the financing for the acquisitions and related transactions. The pro forma adjustments reflected in the table below are subject to change as additional analysis is performed. The acquisition measurement periods for NES and Neff have ended and the values assigned to the NES and Neff assets acquired and liabilities assumed are final. The opening balance sheet values assigned to the BakerCorp assets acquired and liabilities assumed are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period. Increases or decreases in the estimated fair values of the net assets acquired may impact our statements of income in future periods. The tables below present unaudited pro forma consolidated income statement information as if NES, Neff and BakerCorp had been included in our consolidated results for the entire periods reflected. NES and Neff are excluded from the 2018 table because they are included in our results for the entire nine months ended September 30, 2018.

	Three Months Ended													Nine Months Ended
	September 30, 2017													September 30, 2017
	United Rentals		NES		Neff			BakerCorp			Total			United Rentals		NES			Neff			BakerCorp			Total
Historic/pro forma revenues	$	1,766	$	—	$	111		$	70		$	1,947		$	4,719	$	81		$	312		$	199		$	5,311
Historic/combined pretax income (loss)	322		—		16			(6		)	332			712		(12		)	38			(62		)	676
Pro forma adjustments to pretax income (loss):
Impact of fair value mark-ups/useful life changes on depreciation (1)			—		(3		)	(4		)	(7		)			(9		)	(8		)	(10		)	(27		)
Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales (2)			—		—			—			—					(1		)	(1		)	—			(2		)
Intangible asset amortization (3)			—		(7		)	(8		)	(15		)			(6		)	(21		)	(25		)	(52		)
Goodwill impairment (4)			—		—			—			—					—			—			32			32
Interest expense (5)			—		(17		)	(5		)	(22		)			(9		)	(51		)	(14		)	(74		)
Elimination of historic interest (6)			—		11			10			21					12			34			30			76
Elimination of merger related costs (7)			1		15			—			16					17			15			—			32
Restructuring charges (8)			4		(3		)	—			1					(5		)	(19		)	(6		)	(30		)
Pro forma pretax income											$	326													$	631

	Three Months Ended								Nine Months Ended
	September 30, 2018								September 30, 2018
	United Rentals		BakerCorp			Total			United Rentals		BakerCorp			Total
Historic/pro forma revenues	$	2,116	$	28		$	2,144		$	5,741	$	184		$	5,925
Historic/combined pretax income (loss)	460		(63		)	397			1,051		(84		)	967
Pro forma adjustments to pretax income (loss):
Impact of fair value mark-ups/useful life changes on depreciation (1)			(1		)	(1		)			(8		)	(8		)
Intangible asset amortization (3)			(1		)	(1		)			(16		)	(16		)
Interest expense (5)			(2		)	(2		)			(14		)	(14		)
Elimination of historic interest (6)			9			9					30			30
Elimination of merger related costs (7)			65			65					66			66
Restructuring charges (8)			6			6					6			6
Pro forma pretax income						$	473							$	1,031

(1) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups, and the changes in useful lives and salvage values, of the equipment acquired in the NES, Neff and BakerCorp acquisitions.

(2) Cost of rental equipment sales was adjusted for the fair value mark-ups of rental equipment acquired in the NES and Neff acquisitions. BakerCorp did not historically recognize a material amount of rental equipment sales, and accordingly no adjustment was required for BakerCorp.

(3) The intangible assets acquired in the NES, Neff and BakerCorp acquisitions were amortized.

(4) The goodwill impairment charge that BakerCorp recognized during the nine months ended September 30, 2017 was eliminated. If the acquisition had occurred as of the pro forma acquisition date, this impairment charge would not have been recognized (instead, we would have tested for goodwill impairment based on the post-acquisition reporting unit structure).

(5) As discussed above, we issued debt to partially fund the NES, Neff and BakerCorp acquisitions. Interest expense was adjusted to reflect these changes in our debt portfolio.

(6) Historic interest on debt that is not part of the combined entity was eliminated.

(7) Merger related costs primarily comprised of financial and legal advisory fees associated with the NES, Neff and BakerCorp acquisitions were eliminated as they were assumed to have been recognized prior to the pro forma acquisition date. The adjustments for BakerCorp for the three and nine months ended September 30, 2018 include $57 of merger related costs recognized by BakerCorp prior to the acquisition.

(8) We expect to recognize restructuring charges primarily comprised of severance costs and branch closure charges associated with the acquisitions over a period of approximately one year following the acquisition dates, which, for the pro forma presentation, was January 1, 2017. The adjustments above reflect the timing of the actual restructuring charges following the acquisitions (the pro forma restructuring charges above for the three and nine months ended September 30, 2017 reflect the actual restructuring charges recognized during the three and nine months following the acquisitions). We do not expect to incur significant additional restructuring charges for NES and Neff. We expect to incur additional restructuring charges for BakerCorp, however the remaining costs are not currently estimable, as we are still identifying the actions that will be undertaken.

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Segment Information

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Segment Information

Segment Information

Following the acquisition of BakerCorp discussed in note 3 to the condensed consolidated financial statements, we changed the name of our former “trench, power and pump” segment to “trench, power and fluid solutions”. The locations acquired in the BakerCorp acquisition are in our Fluid Solutions (before the acquisition, “Pump Solutions”) and Fluid Solutions Europe regions, both of which are in the trench, power and fluid solutions segment. The changes to the region and segment names reflect a broader product offering following the BakerCorp acquisition.

Our reportable segments are i) general rentals and ii) trench, power and fluid solutions. The general rentals segment includes the rental of i) general construction and industrial equipment, such as backhoes, skid-steer loaders, forklifts, earthmoving equipment and material handling equipment, ii) aerial work platforms, such as boom lifts and scissor lifts and iii) general tools and light equipment, such as pressure washers, water pumps and power tools. The general rentals segment reflects the aggregation of 11 geographic regions—Carolinas, Gulf South, Industrial (which serves the geographic Gulf region and has a strong industrial presence), Mid-Atlantic, Mid Central, Midwest, Northeast, Pacific West, South, Southeast and Western Canada—and operates throughout the United States and Canada.

The trench, power and fluid solutions segment includes the rental of specialty construction products such as i) trench safety equipment, such as trench shields, aluminum hydraulic shoring systems, slide rails, crossing plates, construction lasers and line testing equipment for underground work, ii) power and HVAC equipment, such as portable diesel generators, electrical distribution equipment, and temperature control equipment and iii) fluid solutions equipment primarily used for fluid storage, transfer and treatment. The trench, power and fluid solutions segment is comprised of the following regions, each of which primarily rents the corresponding equipment type described above: i) the Trench Safety region, ii) the Power and HVAC region, iii) the Fluid Solutions region and iv) the Fluid Solutions Europe region. The trench, power and fluid solutions segment’s customers include construction companies involved in infrastructure projects, municipalities and industrial companies. This segment operates throughout the United States and in Canada and Europe.

These segments align our external segment reporting with how management evaluates and allocates resources. We evaluate segment performance based on segment equipment rentals gross profit.

The following tables set forth financial information by segment.

	General rentals		Trench, power and fluid solutions		Total
Three Months Ended September 30, 2018
Equipment rentals	$	1,444	$	417	$	1,861
Sales of rental equipment	130		10		140
Sales of new equipment	50		4		54
Contractor supplies sales	17		7		24
Service and other revenues	33		4		37
Total revenue	1,674		442		2,116
Depreciation and amortization expense	351		67		418
Equipment rentals gross profit	629		218		847
Three Months Ended September 30, 2017
Equipment rentals	$	1,237	$	299	$	1,536
Sales of rental equipment	130		9		139
Sales of new equipment	34		6		40
Contractor supplies sales	17		4		21
Service and other revenues	26		4		30
Total revenue	1,444		322		1,766
Depreciation and amortization expense	306		47		353
Equipment rentals gross profit	525		164		689
Nine Months Ended September 30, 2018
Equipment rentals	$	3,977	$	974	$	4,951
Sales of rental equipment	446		32		478
Sales of new equipment	125		15		140
Contractor supplies sales	50		16		66
Service and other revenues	95		11		106
Total revenue	4,693		1,048		5,741
Depreciation and amortization expense	1,022		179		1,201
Equipment rentals gross profit	1,598		482		2,080
Capital expenditures	1,845		251		2,096
Nine Months Ended September 30, 2017
Equipment rentals	$	3,357	$	712	$	4,069
Sales of rental equipment	348		30		378
Sales of new equipment	112		14		126
Contractor supplies sales	49		11		60
Service and other revenues	76		10		86
Total revenue	3,942		777		4,719
Depreciation and amortization expense	855		138		993
Equipment rentals gross profit	1,350		359		1,709
Capital expenditures	1,404		168		1,572

	September 30, 2018		December 31, 2017
Total reportable segment assets
General rentals	$	13,766	$	13,351
Trench, power and fluid solutions (1)	2,588		1,679
Total assets	$	16,354	$	15,030

(1) The increase in the trench, power and fluid solutions assets primarily reflects the impact of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements.

Equipment rentals gross profit is the primary measure management reviews to make operating decisions and assess segment performance. The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2018			2017			2018			2017
Total equipment rentals gross profit	$	847		$	689		$	2,080		$	1,709
Gross profit from other lines of business	91			84			286			233
Selling, general and administrative expenses	(265		)	(237		)	(736		)	(648		)
Merger related costs	(11		)	(16		)	(14		)	(32		)
Restructuring charge	(9		)	(9		)	(15		)	(28		)
Non-rental depreciation and amortization	(75		)	(63		)	(213		)	(189		)
Interest expense, net	(118		)	(131		)	(339		)	(338		)
Other income, net	—			5			2			5
Income before provision for income taxes	$	460		$	322		$	1,051		$	712

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Restructuring Charges

9 Months Ended

Sep. 30, 2018

Restructuring and Related Activities [Abstract]

Restructuring Charges

Restructuring Charges

Restructuring Charges

Restructuring charges primarily include severance costs associated with headcount reductions, as well as branch closure charges which principally relate to continuing lease obligations at vacant facilities. We incur severance costs and branch closure charges in the ordinary course of our business. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed three restructuring programs and have incurred total restructuring charges of $299.

Closed Restructuring Programs

We have three closed restructuring programs. The first was initiated in 2008 in recognition of a challenging economic environment and was completed in 2011. The second was initiated following the April 30, 2012 acquisition of RSC Holdings Inc. ("RSC"), and was completed in 2013. The third was initiated in the fourth quarter of 2015 in response to challenges in our operating environment. In particular, during 2015, we experienced volume and pricing pressure in our general rental business and our Fluid Solutions region associated with upstream oil and gas customers. Additionally, our Lean initiatives did not fully generate the anticipated cost savings due to lower than expected growth. In 2016, we achieved the anticipated run rate savings from the Lean initiatives, and this restructuring program was completed in 2016.

NES/Neff/Project XL Restructuring Program

In the second quarter of 2017, we initiated a restructuring program following the closing of the NES acquisition discussed in note 3 to the condensed consolidated financial statements. The restructuring program also includes actions undertaken associated with Project XL, which is a set of eight specific work streams focused on driving profitable growth through revenue opportunities and generating incremental profitability through cost savings across our business, and the Neff acquisition that is discussed in note 3 to the condensed consolidated financial statements. We expect to complete the restructuring program in 2018, and do not expect to incur significant additional expenses in connection with the program.

BakerCorp Restructuring Program

In the third quarter of 2018, we initiated a restructuring program following the closing of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements. We expect to complete the restructuring program in 2019. The total costs expected to be incurred in connection with the program are not currently estimable, as we are still identifying the actions that will be undertaken.

The table below provides certain information concerning restructuring activity during the nine months ended September 30, 2018:

	Reserve Balance at		Charged to Costs and Expenses (1)		Payments and Other			Reserve Balance at
	December 31, 2017							September 30, 2018
Closed Restructuring Programs
Branch closure charges	$	13	$	1	$	(4	)	$	10
Severance and other	—		—		—			—
Total	$	13	$	1	$	(4	)	$	10
NES/Neff/Project XL Restructuring Program
Branch closure charges	$	8	$	1	$	(5	)	$	4
Severance and other	12		7		(11		)	8
Total	$	20	$	8	$	(16	)	$	12
BakerCorp Restructuring Program
Branch closure charges	$	—	$	—	$	—		$	—
Severance and other	—		6		(2		)	4
Total	$	—	$	6	$	(2	)	$	4
Total
Branch closure charges	$	21	$	2	$	(9	)	$	14
Severance and other	12		13		(13		)	12
Total	$	33	$	15	$	(22	)	$	26

_________________

(1)    Reflected in our condensed consolidated statements of income as “Restructuring charge.” These charges are not allocated to our reportable segments.

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Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The following table presents the changes in the carrying amount of goodwill for the nine months ended September 30, 2018:

	General rentals			Trench, power and fluid solutions			Total
Balance at January 1, 2018 (1)	$	3,607		$	475		$	4,082
Goodwill related to acquisitions (2)	44			194			238
Foreign currency translation and other adjustments	(6		)	(1		)	(7		)
Balance at September 30, 2018 (1)	3,645			668			4,313

_________________

(1) The total carrying amount of goodwill for all periods in the table above is reflected net of $1.557 billion of accumulated impairment charges, which were primarily recorded in our general rentals segment.

(2) For additional detail on the July 2018 acquisition of BakerCorp, which accounted for most of the goodwill related to acquisitions, see note 3 to our condensed consolidated financial statements.

Other intangible assets were comprised of the following at September 30, 2018 and December 31, 2017:

	September 30, 2018
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	28 months		$	23		$	17		$	6
Customer relationships	8 years		$	1,897		$	1,013		$	884
Trade names and associated trademarks	5 years		$	5		$	—		$	5

	December 31, 2017
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	31 months		$	71		$	62		$	9
Customer relationships	9 years		$	1,750		$	884		$	866

Our other intangibles assets, net at September 30, 2018 include the following assets associated with the acquisition of BakerCorp discussed in note 3 to our condensed consolidated financial statements. No residual value has been assigned to these assets which are being amortized using the sum of the years' digits method, which we believe best reflects the estimated pattern in which the economic benefits will be consumed.

	September 30, 2018
	Weighted-Average Remaining Amortization Period	Net Carrying Amount
Customer relationships	8 years	$	138
Trade names and associated trademarks	5 years	$	5

Amortization expense for other intangible assets was $52 and $41 for the three months ended September 30, 2018 and 2017, respectively, and $145 and $125 for the nine months ended September 30, 2018 and 2017, respectively.

As of September 30, 2018, estimated amortization expense for other intangible assets for each of the next five years and thereafter is as follows:  

2018		$	52
2019	193
2020	167
2021	141
2022	114
Thereafter	228
Total		$	895

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Fair Value Measurements

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

As of September 30, 2018 and December 31, 2017, the amounts of our assets and liabilities that were accounted for at fair value were immaterial.

Fair value measurements are categorized in one of the following three levels based on the lowest level input that is significant to the fair value measurement in its entirety:

Level 1- Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2- Observable inputs other than quoted prices in active markets for identical assets or liabilities include:

a) quoted prices for similar assets or liabilities in active markets;

b) quoted prices for identical or similar assets or liabilities in inactive markets;

c) inputs other than quoted prices that are observable for the asset or liability;

d) inputs that are derived principally from or corroborated by observable market data by correlation or other means.

If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3- Inputs to the valuation methodology are unobservable (i.e., supported by little or no market activity) and significant to the fair value measure.

Fair Value of Financial Instruments

The carrying amounts reported in our condensed consolidated balance sheets for accounts receivable, accounts payable and accrued expenses and other liabilities approximate fair value due to the immediate to short-term maturity of these financial instruments. The fair values of our ABL facility, accounts receivable securitization facility and capital leases approximated their book values as of September 30, 2018 and December 31, 2017. The estimated fair values of our financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of September 30, 2018 and December 31, 2017 have been calculated based upon available market information, and were as follows:

	September 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Senior notes	$	7,014	$	7,006	$	7,008	$	7,340

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Debt

9 Months Ended

Sep. 30, 2018

Debt Disclosure [Abstract]

Debt

Debt

Debt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following:

	September 30, 2018			December 31, 2017
Accounts Receivable Securitization Facility expiring 2018 (1)	$	865		$	695
$3.0 billion ABL Facility expiring 2021 (2)	2,120			1,670
4 5/8 percent Senior Secured Notes due 2023	993			992
5 3/4 percent Senior Notes due 2024	842			841
5 1/2 percent Senior Notes due 2025	794			793
4 5/8 percent Senior Notes due 2025	741			740
5 7/8 percent Senior Notes due 2026	999			998
5 1/2 percent Senior Notes due 2027	991			990
4 7/8 percent Senior Notes due 2028 (3)	1,650			1,648
4 7/8 percent Senior Notes due 2028 (3)	4			6
Capital leases	79			67
Total debt	10,078			9,440
Less short-term portion (4)	(896		)	(723		)
Total long-term debt	$	9,182		$	8,717

 ___________________

(1) In June 2018, the accounts receivable securitization facility was amended, primarily to increase the facility size and to extend the maturity date which may be further extended on a 364-day basis by mutual agreement with the purchasers under the facility. The size of the facility, which expires on June 29, 2019, was increased to $875.At September 30, 2018, $9 was available under our accounts receivable securitization facility. The interest rate applicable to the accounts receivable securitization facility was 3.0 percent at September 30, 2018. During the nine months ended September 30, 2018, the monthly average principal amount outstanding under the accounts receivable securitization facility was $788, and the weighted-average interest rate thereon was 2.8 percent. The maximum month-end principal amount outstanding under the accounts receivable securitization facility during the nine months ended September 30, 2018 was $870. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of September 30, 2018, there were $1.024 billion of receivables, net of applicable reserves and other deductions, in the collateral pool.

(2) At September 30, 2018, $836 was available under our ABL facility, net of $37 of letters of credit. The interest rate applicable to the ABL facility was 3.7 percent at September 30, 2018. During the nine months ended September 30, 2018, the monthly average principal amount outstanding under the ABL facility was $1.485 billion, and the weighted-average interest rate thereon was 3.4 percent. The maximum month-end principal amount outstanding under the ABL facility during the nine months ended September 30, 2018 was $2.127 billion.

(3) URNA separately issued 4 ⁷/₈ percent Senior Notes in August 2017 and in September 2017. Following the issuances, we consummated an exchange offer pursuant to which most of the 4 ⁷/₈ percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 ⁷/₈ percent Senior Notes issued in August 2017.

(4) As of September 30, 2018, our short-term debt primarily reflects $865 of borrowings under our accounts receivable securitization facility.

Loan Covenants and Compliance

As of September 30, 2018, we were in compliance with the covenants and other provisions of the ABL facility, the accounts receivable securitization facility and the senior notes. Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations.

The only financial maintenance covenant that currently exists under the ABL facility is the fixed charge coverage ratio. Subject to certain limited exceptions specified in the ABL facility, the fixed charge coverage ratio covenant under the ABL facility will only apply in the future if specified availability under the ABL facility falls below 10 percent of the maximum revolver amount under the ABL facility. When certain conditions are met, cash and cash equivalents and borrowing base collateral in excess of the ABL facility size may be included when calculating specified availability under the ABL facility. As of September 30, 2018, specified availability under the ABL facility exceeded the required threshold and, as a result, this financial maintenance covenant was inapplicable. Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to: (i) the default ratio, (ii) the delinquency ratio, (iii) the dilution ratio and (iv) days sales outstanding. The accounts receivable securitization facility also requires us to comply with the fixed charge coverage ratio under the ABL facility, to the extent the ratio is applicable under the ABL facility.

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Legal and Regulatory Matters

9 Months Ended

Sep. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Legal and Regulatory Matters

Legal and Regulatory Matters

We are subject to a number of claims and proceedings that generally arise in the ordinary course of our business. These matters include, but are not limited to, general liability claims (including personal injury, property and auto claims), indemnification and guarantee obligations, employee injuries and employment-related claims, self-insurance obligations, contract and real estate matters, and other general business litigation. Based on advice of counsel and available information, including current status or stage of proceeding, and taking into account accruals for matters where we have established them, we currently believe that any liabilities ultimately resulting from such claims and proceedings will not, individually or in the aggregate, have a material adverse effect on our consolidated financial condition, results of operations or cash flows.

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Earnings Per Share

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

Basic earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares plus the effect of dilutive potential common shares outstanding during the period. Net income and earnings per share for 2018 reflect lower effective tax rates due to the enactment of the Tax Act in December 2017, as discussed further below (see "Management’s Discussion and Analysis of Financial Condition and Results of Operations-Results of Operations-Other costs/(income)"). The following table sets forth the computation of basic and diluted earnings per share (shares in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Numerator:
Net income available to common stockholders	$	333	$	199	786		449
Denominator:
Denominator for basic earnings per share—weighted-average common shares	82,344		84,663		83,345		84,585
Effect of dilutive securities:
Employee stock options	372		398		389		401
Restricted stock units	456		531		477		488
Denominator for diluted earnings per share—adjusted weighted-average common shares	83,172		85,592		84,211		85,474
Basic earnings per share	$	4.05	$	2.36	$	9.44	$	5.31
Diluted earnings per share	$	4.01	$	2.33	$	9.34	$	5.26

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Condensed Consolidating Financial Information of Guarantor Subsidiaries

9 Months Ended

Sep. 30, 2018

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Financial Information of Guarantor Subsidiaries

Condensed Consolidating Financial Information of Guarantor Subsidiaries

URNA is 100 percent owned by Holdings (“Parent”) and has certain outstanding indebtedness that is guaranteed by both Parent and, with the exception of its U.S. special purpose vehicle which holds receivable assets relating to the Company’s accounts receivable securitization facility (the “SPV”) and United Rentals International Management LLC, which is an immaterial subsidiary, all of URNA’s U.S. subsidiaries (the “guarantor subsidiaries”). Other than the guarantee by certain Canadian subsidiaries of URNA's indebtedness under the ABL facility, none of URNA’s indebtedness is guaranteed by URNA's foreign subsidiaries, the SPV or United Rentals International Management LLC (together, the “non-guarantor subsidiaries”). The SPV and United Rentals International Management LLC are presented together in the “Domestic” columns in the tables below. The receivable assets owned by the SPV have been sold or contributed by URNA to the SPV and are not available to satisfy the obligations of URNA or Parent’s other subsidiaries. The guarantor subsidiaries are all 100 percent-owned and the guarantees are made on a joint and several basis. The guarantees are not full and unconditional because a guarantor subsidiary can be automatically released and relieved of its obligations under certain circumstances, including sale of the guarantor subsidiary, the sale of all or substantially all of the guarantor subsidiary's assets, the requirements for legal defeasance or covenant defeasance under the applicable indenture being met, designating the guarantor subsidiary as an unrestricted subsidiary for purposes of the applicable covenants or, other than with respect to the guarantees of the 5 ³/₄ percent Senior Notes due 2024, the notes being rated investment grade by both Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc., or, in certain circumstances, another rating agency selected by URNA. The guarantees are also subject to subordination provisions (to the same extent that the obligations of the issuer under the relevant notes are subordinated to other debt of the issuer) and to a standard limitation which provides that the maximum amount guaranteed by each guarantor will not exceed the maximum amount that can be guaranteed without making the guarantee void under fraudulent conveyance laws. Based on our understanding of Rule 3-10 of Regulation S-X ("Rule 3-10"), we believe that the guarantees of the guarantor subsidiaries comply with the conditions set forth in Rule 3-10 and therefore continue to utilize Rule 3-10 to present condensed consolidating financial information for Holdings, URNA, the guarantor subsidiaries and the non-guarantor subsidiaries. Separate consolidated financial statements of the guarantor subsidiaries have not been presented because management believes that such information would not be material to investors. However, condensed consolidating financial information is presented.

URNA covenants in the ABL facility, accounts receivable securitization facility and the other agreements governing our debt impose operating and financial restrictions on URNA, Parent and the guarantor subsidiaries, including limitations on the ability to make share repurchases and dividend payments. As of September 30, 2018, the amount available for distribution under the most restrictive of these covenants was $709. The Company’s total available capacity for making share repurchases and dividend payments includes the intercompany receivable balance of Parent. As of September 30, 2018, our total available capacity for making share repurchases and dividend payments, which includes URNA’s capacity to make restricted payments and the intercompany receivable balance of Parent, was $2.034 billion.

The condensed consolidating financial information of Parent and its subsidiaries is as follows:

CONDENSED CONSOLIDATING BALANCE SHEET

September 30, 2018

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			Domestic
ASSETS
Cash and cash equivalents	$	—	$	17		$	—		$	48		$	—	$	—		$	65
Accounts receivable, net	—		—			—			141			1,297		—			1,438
Intercompany receivable (payable)	1,325		(1,200		)	(96		)	(29		)	—		—			—
Inventory	—		94			—			10			—		—			104
Prepaid expenses and other assets	—		81			—			4			—		—			85
Total current assets	1,325		(1,008		)	(96		)	174			1,297		—			1,692
Rental equipment, net	—		8,243			—			667			—		—			8,910
Property and equipment, net	51		394			40			44			—		—			529
Investments in subsidiaries	1,973		1,534			966			—			22		(4,495		)	—
Goodwill	—		3,902			—			411			—		—			4,313
Other intangible assets, net	—		812			—			83			—		—			895
Other long-term assets	7		8			—			—			—		—			15
Total assets	$	3,356	$	13,885		$	910		$	1,379		$	1,319	$	(4,495	)	$	16,354
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	28		$	—		$	2		$	865	$	—		$	896
Accounts payable	—		624			—			64			—		—			688
Accrued expenses and other liabilities	—		449			14			38			2		—			503
Total current liabilities	1		1,101			14			104			867		—			2,087
Long-term debt	—		9,170			9			3			—		—			9,182
Deferred taxes	21		1,518			—			89			—		—			1,628
Other long-term liabilities	—		123			—			—			—		—			123
Total liabilities	22		11,912			23			196			867		—			13,020
Total stockholders’ equity (deficit)	3,334		1,973			887			1,183			452		(4,495		)	3,334
Total liabilities and stockholders’ equity (deficit)	$	3,356	$	13,885		$	910		$	1,379		$	1,319	$	(4,495	)	$	16,354

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2017

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			Domestic
ASSETS
Cash and cash equivalents	$	—	$	23		$	—		$	329		$	—	$	—		$	352
Accounts receivable, net	—		56			—			119			1,058		—			1,233
Intercompany receivable (payable)	887		(677		)	(198		)	(124		)	—		112			—
Inventory	—		68			—			7			—		—			75
Prepaid expenses and other assets	4		219			111			2			—		(224		)	112
Total current assets	891		(311		)	(87		)	333			1,058		(112		)	1,772
Rental equipment, net	—		7,264			—			560			—		—			7,824
Property and equipment, net	41		352			32			42			—		—			467
Investments in subsidiaries	2,194		1,148			1,087			—			—		(4,429		)	—
Goodwill	—		3,815			—			267			—		—			4,082
Other intangible assets, net	—		827			—			48			—		—			875
Other long-term assets	3		7			—			—			—		—			10
Total assets	$	3,129	$	13,102		$	1,032		$	1,250		$	1,058	$	(4,541	)	$	15,030
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	25		$	—		$	2		$	695	$	—		$	723
Accounts payable	—		366			—			43			—		—			409
Accrued expenses and other liabilities	—		477			17			41			1		—			536
Total current liabilities	1		868			17			86			696		—			1,668
Long-term debt	1		8,596			117			3			—		—			8,717
Deferred taxes	21		1,324			—			74			—		—			1,419
Other long-term liabilities	—		120			—			—			—		—			120
Total liabilities	23		10,908			134			163			696		—			11,924
Total stockholders’ equity (deficit)	3,106		2,194			898			1,087			362		(4,541		)	3,106
Total liabilities and stockholders’ equity (deficit)	$	3,129	$	13,102		$	1,032		$	1,250		$	1,058	$	(4,541	)	$	15,030

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2018

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	1,715	$	—		$	146	$	—		$	—		$	1,861
Sales of rental equipment	—			128		—			12		—			—			140
Sales of new equipment	—			46		—			8		—			—			54
Contractor supplies sales	—			22		—			2		—			—			24
Service and other revenues	—			32		—			5		—			—			37
Total revenues	—			1,943		—			173		—			—			2,116
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			614		—			57		—			—			671
Depreciation of rental equipment	—			316		—			27		—			—			343
Cost of rental equipment sales	—			76		—			7		—			—			83
Cost of new equipment sales	—			40		—			6		—			—			46
Cost of contractor supplies sales	—			14		—			1		—			—			15
Cost of service and other revenues	—			16		—			4		—			—			20
Total cost of revenues	—			1,076		—			102		—			—			1,178
Gross profit	—			867		—			71		—			—			938
Selling, general and administrative expenses	28			197		—			24		16			—			265
Merger related costs	—			11		—			—		—			—			11
Restructuring charge	—			8		—			1		—			—			9
Non-rental depreciation and amortization	3			65		—			7		—			—			75
Operating (loss) income	(31		)	586		—			39		(16		)	—			578
Interest (income) expense, net	(11		)	122		(1		)	1		7			—			118
Other (income) expense, net	(172		)	196		—			13		(37		)	—			—
Income before provision for income taxes	152			268		1			25		14			—			460
Provision for income taxes	45			71		—			8		3			—			127
Income before equity in net earnings (loss) of subsidiaries	107			197		1			17		11			—			333
Equity in net earnings (loss) of subsidiaries	226			29		17			—		—			(272		)	—
Net income (loss)	333			226		18			17		11			(272		)	333
Other comprehensive income (loss)	18			18		18			18		—			(54		)	18
Comprehensive income (loss)	$	351		$	244	$	36		$	35	$	11		$	(326	)	$	351

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2017

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	1,407	$	—		$	129	$	—		$	—		$	1,536
Sales of rental equipment	—			118		—			21		—			—			139
Sales of new equipment	—			36		—			4		—			—			40
Contractor supplies sales	—			18		—			3		—			—			21
Service and other revenues	—			27		—			3		—			—			30
Total revenues	—			1,606		—			160		—			—			1,766
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			502		—			55		—			—			557
Depreciation of rental equipment	—			266		—			24		—			—			290
Cost of rental equipment sales	—			73		—			11		—			—			84
Cost of new equipment sales	—			31		—			3		—			—			34
Cost of contractor supplies sales	—			12		—			2		—			—			14
Cost of service and other revenues	—			12		—			2		—			—			14
Total cost of revenues	—			896		—			97		—			—			993
Gross profit	—			710		—			63		—			—			773
Selling, general and administrative expenses	42			167		—			19		9			—			237
Merger related costs	—			16		—			—		—			—			16
Restructuring charge	—			8		—			1		—			—			9
Non-rental depreciation and amortization	3			54		—			6		—			—			63
Operating (loss) income	(45		)	465		—			37		(9		)	—			448
Interest (income) expense, net	(5		)	133		1			1		3			(2		)	131
Other (income) expense, net	(144		)	154		—			10		(25		)	—			(5		)
Income (loss) before provision for income taxes	104			178		(1		)	26		13			2			322
Provision for income taxes	39			73		—			7		4			—			123
Income (loss) before equity in net earnings (loss) of subsidiaries	65			105		(1		)	19		9			2			199
Equity in net earnings (loss) of subsidiaries	134			29		19			—		—			(182		)	—
Net income (loss)	199			134		18			19		9			(180		)	199
Other comprehensive income (loss)	42			42		41			33		—			(116		)	42
Comprehensive income (loss)	$	241		$	176	$	59		$	52	$	9		$	(296	)	$	241

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Nine Months EndedSeptember 30, 2018

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations			Total
										Foreign			Domestic
Revenues:
Equipment rentals	$	—		$	4,568		$	—		$	383		$	—		$	—		$	4,951
Sales of rental equipment	—			435			—			43			—			—			478
Sales of new equipment	—			123			—			17			—			—			140
Contractor supplies sales	—			58			—			8			—			—			66
Service and other revenues	—			92			—			14			—			—			106
Total revenues	—			5,276			—			465			—			—			5,741
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			1,710			—			173			—			—			1,883
Depreciation of rental equipment	—			911			—			77			—			—			988
Cost of rental equipment sales	—			259			—			23			—			—			282
Cost of new equipment sales	—			107			—			14			—			—			121
Cost of contractor supplies sales	—			38			—			5			—			—			43
Cost of service and other revenues	—			49			—			9			—			—			58
Total cost of revenues	—			3,074			—			301			—			—			3,375
Gross profit	—			2,202			—			164			—			—			2,366
Selling, general and administrative expenses	33			604			—			66			33			—			736
Merger related costs	—			14			—			—			—			—			14
Restructuring charge	—			14			—			1			—			—			15
Non-rental depreciation and amortization	11			185			—			17			—			—			213
Operating (loss) income	(44		)	1,385			—			80			(33		)	—			1,388
Interest (income) expense, net	(26		)	349			—			—			17			(1		)	339
Other (income) expense, net	(469		)	529			—			37			(99		)	—			(2		)
Income before provision for income taxes	451			507			—			43			49			1			1,051
Provision for income taxes	105			135			—			13			12			—			265
Income before equity in net earnings (loss) of subsidiaries	346			372			—			30			37			1			786
Equity in net earnings (loss) of subsidiaries	440			68			30			—			—			(538		)	—
Net income (loss)	786			440			30			30			37			(537		)	786
Other comprehensive (loss) income	(27		)	(27		)	(28		)	(95		)	—			150			(27		)
Comprehensive income (loss)	$	759		$	413		$	2		$	(65	)	$	37		$	(387	)	$	759

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Nine Months EndedSeptember 30, 2017

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	3,739	$	—		$	330	$	—		$	—		$	4,069
Sales of rental equipment	—			334		—			44		—			—			378
Sales of new equipment	—			113		—			13		—			—			126
Contractor supplies sales	—			53		—			7		—			—			60
Service and other revenues	—			75		—			11		—			—			86
Total revenues	—			4,314		—			405		—			—			4,719
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			1,397		—			159		—			—			1,556
Depreciation of rental equipment	—			738		—			66		—			—			804
Cost of rental equipment sales	—			202		—			23		—			—			225
Cost of new equipment sales	—			97		—			11		—			—			108
Cost of contractor supplies sales	—			37		—			5		—			—			42
Cost of service and other revenues	—			37		—			5		—			—			42
Total cost of revenues	—			2,508		—			269		—			—			2,777
Gross profit	—			1,806		—			136		—			—			1,942
Selling, general and administrative expenses	84			483		—			57		24			—			648
Merger related costs	—			32		—			—		—			—			32
Restructuring charge	—			27		—			1		—			—			28
Non-rental depreciation and amortization	11			162		—			16		—			—			189
Operating (loss) income	(95		)	1,102		—			62		(24		)	—			1,045
Interest (income) expense, net	(10		)	341		2			1		8			(4		)	338
Other (income) expense, net	(387		)	419		—			33		(70		)	—			(5		)
Income (loss) before provision for income taxes	302			342		(2		)	28		38			4			712
Provision for income taxes	102			140		—			7		14			—			263
Income (loss) before equity in net earnings (loss) of subsidiaries	200			202		(2		)	21		24			4			449
Equity in net earnings (loss) of subsidiaries	249			47		21			—		—			(317		)	—
Net income (loss)	449			249		19			21		24			(313		)	449
Other comprehensive income (loss)	75			75		75			61		—			(211		)	75
Comprehensive income (loss)	$	524		$	324	$	94		$	82	$	24		$	(524	)	$	524

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Nine Months EndedSeptember 30, 2018

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			Domestic
Net cash provided by (used in) operating activities	$	22		$	2,354		$	(1	)	$	(50	)	$	(202	)	$	—	$	2,123
Net cash used in investing activities	(22		)	(2,259		)	—			(112		)	—			—		(2,393		)
Net cash (used in) provided by financing activities	—			(101		)	1			(109		)	202			—		(7		)
Effect of foreign exchange rates	—			—			—			(10		)	—			—		(10		)
Net decrease in cash and cash equivalents	—			(6		)	—			(281		)	—			—		(287		)
Cash and cash equivalents at beginning of period	—			23			—			329			—			—		352
Cash and cash equivalents at end of period	$	—		$	17		$	—		$	48		$	—		$	—	$	65

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Nine Months EndedSeptember 30, 2017

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			Domestic
Net cash provided by (used in) operating activities	$	15		$	1,839		$	(2	)	$	83		$	(179	)	$	—	$	1,756
Net cash used in investing activities	(15		)	(2,135		)	—			(92		)	—			—		(2,242		)
Net cash provided by (used in) financing activities	—			298			2			(2		)	179			—		477
Effect of foreign exchange rates	—			—			—			21			—			—		21
Net increase in cash and cash equivalents	—			2			—			10			—			—		12
Cash and cash equivalents at beginning of period	—			21			—			291			—			—		312
Cash and cash equivalents at end of period	$	—		$	23		$	—		$	301		$	—		$	—	$	324

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Subsequent Event

9 Months Ended

Sep. 30, 2018

Subsequent Events [Abstract]

Subsequent Event

Subsequent Event

In September 2018, we entered into a definitive merger agreement to acquire Vander Holding Corporation and its subsidiaries (“BlueLine”) for approximately $2.1 billion. We expect to fund the merger and related fees and expenses using a new $1 billion term loan facility and other debt issuances. BlueLine is one of the ten largest equipment rental companies in North America, serves over 50,000 customers in the construction and industrial sectors with a focus on mid-sized and local accounts, and has 114 locations and over 1,700 employees based in 25 U.S. states, Canada and Puerto Rico. BlueLine has annual revenues of approximately $786. We expect the merger to close in the fourth quarter of 2018, subject to Hart-Scott-Rodino clearance and other customary conditions.

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Organization, Description of Business and Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

New Accounting Pronouncements

New Accounting Pronouncements

Leases. In March 2016, the Financial Accounting Standards Board (“FASB”) issued guidance ("Topic 842") to increase transparency and comparability among organizations by requiring (1) recognition of lease assets and lease liabilities on the balance sheet and (2) disclosure of key information about leasing arrangements. Some changes to the lessor accounting guidance were made to align both of the following: (1) the lessor accounting guidance with certain changes made to the lessee accounting guidance and (2) key aspects of the lessor accounting model with revenue recognition guidance. Topic 842 will be effective for fiscal years and interim periods beginning after December 15, 2018, and early adoption is permitted. A modified retrospective approach is required for adoption for all leases that exist at or commence after the date of initial application with an option to use certain practical expedients. We expect to use the package of practical expedients that allows us to not reassess: (1) whether any expired or existing contracts are or contain leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. We additionally expect to use the practical expedient that allows us to treat the lease and non-lease components of our leases as a single component for our real estate leases. We expect to adopt this guidance when effective, using the transition method that allows us to initially apply Topic 842 at the adoption date of January 1, 2019 and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption.

As discussed in note 2 to our condensed consolidated financial statements, most of our equipment rental revenues, which accounted for 86 percent of total revenues for the nine months ended September 30, 2018, will be accounted for under the current lease accounting standard ("Topic 840") until the adoption of Topic 842. We have tentatively concluded that no significant changes are expected to the accounting for most of our equipment rental revenues upon adoption of Topic 842.

Under Topic 842, our operating leases, which include both real estate and non-rental equipment, will result in lease assets and lease liabilities being recognized on the balance sheet. We lease a significant portion of our branch locations, and also lease other premises used for purposes such as district and regional offices and service centers. We expect that the quantification of the amount of the lease assets and lease liabilities that we will recognize on our balance sheet will take a significant amount of time given the size of our lease portfolio. While our review of the lessee accounting requirements of Topic 842 is ongoing, we believe that the impact on our balance sheet, while not currently estimable, will be significant.

Measurement of Credit Losses on Financial Instruments. In June 2016, the FASB issued guidance that will require companies to present assets held at amortized cost and available for sale debt securities net of the amount expected to be collected. The guidance requires the measurement of expected credit losses to be based on relevant information from past events, including historical experiences, current conditions and reasonable and supportable forecasts that affect collectibility. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2019 and early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Different components of the guidance require modified retrospective or prospective adoption. We are currently assessing whether we will early adopt, and the impact on our financial statements is not currently estimable as it will depend on market conditions and our forecast expectations upon, and following, adoption.

Simplifying the Test for Goodwill Impairment. In January 2017, the FASB issued guidance intended to simplify the subsequent accounting for goodwill acquired in a business combination. Prior guidance required utilizing a two-step process to review goodwill for impairment. A second step was required if there was an indication that an impairment may exist, and the second step required calculating the potential impairment by comparing the implied fair value of the reporting unit's goodwill (as if purchase accounting were performed on the testing date) with the carrying amount of the goodwill. The new guidance eliminates the second step from the goodwill impairment test. Under the new guidance, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and then recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value (although the loss should not exceed the total amount of goodwill allocated to the reporting unit). The guidance requires prospective adoption and will be effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption of this guidance is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We are currently assessing whether we will early adopt. The guidance is not expected to have a significant impact on our financial statements.

Derivatives and Hedging. In August 2017, the FASB issued guidance with the objective of improving the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. The guidance is additionally intended to simplify hedge accounting, and no longer requires separate measurement and reporting of hedge ineffectiveness. For cash flow and net investment hedges existing at the date of adoption, entities must apply a cumulative-effect adjustment related to eliminating the separate measurement of ineffectiveness to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retained earnings. The amended presentation and disclosure guidance is required prospectively. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2018, and early adoption is permitted. We are currently assessing whether we will early adopt. Given our currently limited use of derivative instruments, the guidance is not expected to have a significant impact on our financial statements.

Guidance Adopted in 2018

Revenue from Contracts with Customers. See note 2 to our condensed consolidated financial statements for a discussion of our revenue recognition accounting following our adoption in the first quarter of 2018 of FASB guidance addressing the principles for recognizing revenue.

Statement of Cash Flows. In 2018, we retrospectively adopted guidance that was issued to reduce the diversity in the presentation of certain cash receipts and cash payments presented and classified in the statement of cash flows. The guidance addresses the following specific cash flow issues: (1) debt prepayment or debt extinguishment costs, (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (6) distributions received from equity method investees, (7) beneficial interests in securitization transitions and (8) separately identifiable cash flows and application of predominance principle. The adoption of this guidance did not have a significant impact on our financial statements for the three and nine months ended September 30, 2018 or 2017.

Intra-Entity Transfers of Assets Other Than Inventory. In 2018, we adopted guidance that requires companies to recognize the income tax effects of intra-entity sales and transfers of assets other than inventory in the period in which the transfer occurs. The adoption of this guidance did not have a significant impact on our financial statements.

Clarifying the Definition of a Business. In 2018, we adopted guidance that was issued to clarify the definition of a business with the objective of assisting entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is intended to make determining when a set of assets and activities is a business more consistent and cost-efficient. The future impact of this guidance will depend on the nature of our future activities, and fewer transactions may be treated as acquisitions (or disposals) of businesses after adoption.

Stock Compensation: Scope of Modification Accounting. In 2018, we prospectively adopted guidance that was issued to provide clarity and reduce both the (1) diversity in practice and (2) cost and complexity when changing the terms or conditions of share-based payment awards. Under the updated guidance, a modification is defined as a change in the terms or conditions of a share-based payment award, and an entity should account for the effects of a modification unless all of the following are met:

1.The fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation techniques that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification.

2.The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified.

3.The classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified.

The majority of our modifications relate to the acceleration of vesting conditions. The accounting for such modifications did not change under the adopted guidance, which did not have a significant impact on our financial statements.

Performance obligations

Most of our Topic 606 revenue is recognized at a point-in-time, rather than over time. Accordingly, in any particular period, we do not generally recognize a significant amount of revenue from performance obligations satisfied (or partially satisfied) in previous periods, and the amount of such revenue recognized during the three and nine months ended September 30, 2018 and 2017 was not material. We also do not expect to recognize material revenue in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2018.

Payment terms

Our Topic 606 revenues do not include material amounts of variable consideration. Our payment terms vary by the type and location of our customer and the products or services offered. The time between invoicing and when payment is due is not significant. Our contracts do not generally include a significant financing component. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Our contracts with customers do not generally result in significant obligations associated with returns, refunds or warranties. See above for a discussion of how we manage credit risk.

Sales tax amounts collected from customers are recorded on a net basis.

Contract costs

We do not recognize any assets associated with the incremental costs of obtaining a contract with a customer (for example, a sales commission) that we expect to recover. Most of our revenue is recognized at a point-in-time or over a period of one year or less, and we use the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that we otherwise would have recognized is one year or less.

Contract estimates and judgments

Our revenues accounted for under Topic 606 generally do not require significant estimates or judgments, primarily for the following reasons:

• The transaction price is generally fixed and stated on our contracts;

• As noted above, our contracts generally do not include multiple performance obligations, and accordingly do not generally require estimates of the standalone selling price for each performance obligation;

• Our revenues do not include material amounts of variable consideration; and

• Most of our revenue is recognized as of a point-in-time and the timing of the satisfaction of the applicable performance obligations is readily determinable. As noted above, our Topic 606 revenue is generally recognized at the time of delivery to, or pick-up by, the customer.

We monitor and review our estimated standalone selling prices on a regular basis.

Lease revenues (Topic 840)

The accounting for the types of revenue that are accounted for under Topic 840 is discussed below. As discussed in note 1 to the condensed consolidated financial statements, we expect to adopt Topic 842, which is an update to Topic 840, on January 1, 2019. We have tentatively concluded that no significant changes are expected to our revenue accounting upon adoption of Topic 842.

Owned equipment rentals: Owned equipment rentals represent revenues from renting equipment that we own. We account for such rentals as operating leases.

We recognize revenues from renting equipment on a straight-line basis. Our rental contract periods are hourly, daily, weekly or monthly. By way of example, if a customer were to rent a piece of equipment and the daily, weekly and monthly rental rates for that particular piece were (in actual dollars) $100, $300 and $900, respectively, we would recognize revenue of $32.14 per day. The daily rate for recognition purposes is calculated by dividing the monthly rate of $900 by the monthly term of 28 days. This daily rate assumes that the equipment will be on rent for the full 28 days, as we are unsure of when the customer will return the equipment and therefore unsure of which rental contract period will apply.

As part of this straight-line methodology, when the equipment is returned, we recognize as incremental revenue the excess, if any, between the amount the customer is contractually required to pay, which is based on the rental contract period applicable to the actual number of days the equipment was out on rent, over the cumulative amount of revenue recognized to date. In any given accounting period, we will have customers return equipment and be contractually required to pay us more than the cumulative amount of revenue recognized to date under the straight-line methodology. For instance, continuing the above example, if the customer rented the above piece of equipment on December 29 and returned it at the close of business on January 1, we would recognize incremental revenue on January 1 of $171.44 (in actual dollars, representing the difference between the amount the customer is contractually required to pay, or $300 at the weekly rate, and the cumulative amount recognized to date on a straight-line basis, or $128.56, which represents four days at $32.14 per day).

Adoption of Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”

In May 2014, and in subsequent updates, the FASB issued guidance ("Topic 606") to clarify the principles for recognizing revenue. Topic 606 is an update to Topic 605, which was the revenue recognition standard in effect through December 31, 2017. Topic 606 includes the required steps to achieve the core principle that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted Topic 606 on January 1, 2018, using the modified retrospective method. The adoption of Topic 606 did not result in any significant changes to our historic revenue accounting under Topic 605. Results for 2018 are presented under Topic 606, while results for 2017 continue to reflect our historic accounting under Topic 605. Because there were no significant changes to our revenue recognition accounting upon adoption of Topic 606, no changes to our historic financial statements were required, and no cumulative change to retained earnings was required.

We applied the Topic 606 practical expedient that allows entities to not restate contracts that begin and are completed within the same annual reporting period. No other practical expedients associated with the adoption of Topic 606 were applied. The only change to our revenue accounting upon adoption of Topic 606 pertains to sales of certain rental equipment. Prior to the adoption of Topic 606, certain sales of rental equipment were deferred until certain contingent future events occurred. Under Topic 606, we are no longer required to defer the revenue. The adoption of Topic 606 results in earlier recognition (primarily in the first quarter) of certain sales of rental equipment, but it does not impact total annual revenue because the contingencies that previously resulted in deferral under Topic 605 are always resolved within the same calendar year.

We maintain allowances for doubtful accounts. These allowances reflect our estimate of the amount of our receivables that we will be unable to collect based on historical write-off experience. Our estimate could require change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowances. Trade receivables that have contractual maturities of one year or less are written-off when they are determined to be uncollectible based on the criteria necessary to qualify as a deduction for federal tax purposes. Write-offs of such receivables require management approval based on specified dollar thresholds.

As discussed below, following the adoption of Topic 606, we recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840 (which addresses lease accounting. As discussed below, we expect to adopt an update to this standard on January 1, 2019). Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services.

As reflected below, most of our revenue is accounted for under Topic 840. Our contracts with customers generally do not include multiple performance obligations. For contracts with multiple Topic 606 performance obligations, we allocate revenue to each performance obligation using our best estimate of the standalone selling price for each performance obligation.

Re-rent revenue: Re-rent revenue reflects revenues from equipment that we rent from vendors and then rent to our customers. We account for such rentals as subleases. The accounting for re-rent revenue is the same as the accounting for owned equipment rentals described above.

“Other” equipment rental revenue is primarily comprised of 1) Rental Protection Plan (or "RPP") revenue associated with the damage waiver customers can purchase when they rent our equipment to protect against potential loss or damage, 2) environmental charges associated with the rental of equipment, and 3) charges for rented equipment that is damaged by our customers.

Revenues from contracts with customers (Topic 606)

The accounting for the types of revenue that are accounted for under Topic 606 is discussed below. Substantially all of our revenues under Topic 606 are recognized at a point-in-time rather than over time.

Delivery and pick-up: Delivery and pick-up revenue associated with renting equipment is recognized when the service is performed.

“Other” equipment rental revenue is primarily comprised of revenues associated with the consumption of fuel by our customers which are recognized when the equipment is returned by the customer (and consumption, if any, can be measured).

Sales of rental equipment, new equipment and contractor supplies are recognized at the time of delivery to, or pick-up by, the customer and when collectibility is reasonably assured.

Service and other revenues primarily represent revenues earned from providing repair and maintenance services on our customers’ fleet (including parts sales). Service revenue is recognized as the services are performed.

Receivables and contract assets and liabilities

As reflected above, most of our equipment rental revenue is accounted for under Topic 840 (such revenue represented 79 percent of our total revenues for the nine months ended September 30, 2018). The customers that are responsible for the remaining revenue that is accounted for under Topic 606 are generally the same customers that rent our equipment. We manage credit risk associated with our accounts receivables at the customer level. Because the same customers generate the revenues that are accounted for under both Topic 606 and Topic 840, the discussions below on credit risk and our allowances for doubtful accounts address our total revenues from Topic 606 (Topic 605 for 2017) and Topic 840.

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Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Schedule of changes in accounting principles

In the following table, revenue is summarized by type and by the applicable accounting standard.

	Three Months Ended September 30,
			2018						2017
	Topic 840		Topic 606		Total		Topic 840		Topic 605		Total
Revenues:
Owned equipment rentals	$	1,589	$	—	$	1,589	$	1,320	$	—	$	1,320
Re-rent revenue	41		—		41		32		—		32
Ancillary and other rental revenues:
Delivery and pick-up	—		132		132		—		107		107
Other	78		21		99		61		16		77
Total ancillary and other rental revenues	78		153		231		61		123		184
Total equipment rentals	1,708		153		1,861		1,413		123		1,536
Sales of rental equipment	—		140		140		—		139		139
Sales of new equipment	—		54		54		—		40		40
Contractor supplies sales	—		24		24		—		21		21
Service and other revenues	—		37		37		—		30		30
Total revenues	$	1,708	$	408	$	2,116	$	1,413	$	353	$	1,766

	Nine Months Ended September 30,
			2018						2017
	Topic 840		Topic 606		Total		Topic 840		Topic 605		Total
Revenues:
Owned equipment rentals	$	4,260	$	—	$	4,260	$	3,508	$	—	$	3,508
Re-rent revenue	95		—		95		78		—		78
Ancillary and other rental revenues:
Delivery and pick-up	—		336		336		—		279		279
Other	198		62		260		160		44		204
Total ancillary and other rental revenues	198		398		596		160		323		483
Total equipment rentals	4,553		398		4,951		3,746		323		4,069
Sales of rental equipment	—		478		478		—		378		378
Sales of new equipment	—		140		140		—		126		126
Contractor supplies sales	—		66		66		—		60		60
Service and other revenues	—		106		106		—		86		86
Total revenues	$	4,553	$	1,188	$	5,741	$	3,746	$	973	$	4,719

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Acquisitions (Tables)

9 Months Ended

Sep. 30, 2018

Business Combinations [Abstract]

Schedule of assets acquired and liabilities assumed

The following table summarizes the fair values of the assets acquired and liabilities assumed. The purchase price allocations for these assets and liabilities are based on preliminary valuations and are subject to change as we obtain additional information during the acquisition measurement period.

Accounts receivable, net of allowance for doubtful accounts (1)	$	73
Inventory	5
Rental equipment	352
Property and equipment	27
Intangibles (2)	149
Other assets	5
Total identifiable assets acquired	611
Current liabilities	(61		)
Deferred taxes	(20		)
Total liabilities assumed	(81		)
Net identifiable assets acquired	530
Goodwill (3)	194
Net assets acquired	$	724

(1) The fair value of accounts receivables acquired was $73, and the gross contractual amount was $79. We estimated that $6 would be uncollectible.

(2) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	144	8
Trade names and associated trademarks	5		5
Total	$	149

(3) All of the goodwill was assigned to our trench, power and fluid solutions segment. The level of goodwill that resulted from the acquisition is primarily reflective of BakerCorp's going-concern value, the value of BakerCorp's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that are not associated with the identifiable assets. $7 of goodwill is expected to be deductible for income tax purposes.

The following table summarizes the fair values of the assets acquired and liabilities assumed.

Accounts receivable, net of allowance for doubtful accounts (1)	$	49
Inventory	4
Rental equipment	571
Property and equipment	48
Intangibles (2)	139
Other assets	7
Total identifiable assets acquired	818
Short-term debt and current maturities of long-term debt (3)	(3		)
Current liabilities	(33		)
Deferred taxes	(15		)
Long-term debt (3)	(11		)
Other long-term liabilities	(5		)
Total liabilities assumed	(67		)
Net identifiable assets acquired	751
Goodwill (4)	209
Net assets acquired	$	960

(1) The fair value of accounts receivables acquired was $49, and the gross contractual amount was $53. We estimated that $4 would be uncollectible.

(2) The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	138	10
Non-compete agreements	1		1
Total	$	139

(3) The acquired debt reflects capital lease obligations.

(4) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of NES's going-concern value, the value of NES's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $1 of goodwill is expected to be deductible for income tax purposes.

The following table summarizes the fair values of the assets acquired and liabilities assumed.

Accounts receivable, net of allowance for doubtful accounts (1)	$	72
Inventory	5
Rental equipment	550
Property and equipment	45
Intangibles (customer relationships) (2)	153
Other assets	5
Total identifiable assets acquired	830
Current liabilities	(62		)
Deferred taxes	(36		)
Other long-term liabilities	(3		)
Total liabilities assumed	(101		)
Net identifiable assets acquired	729
Goodwill (3)	587
Net assets acquired	$	1,316

(1) The fair value of accounts receivables acquired was $72, and the gross contractual amount was $74. We estimated that $2 would be uncollectible.

(2) The customer relationships are being amortized over a 10 year life.

(3) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of Neff's going-concern value, the value of Neff's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $320 of goodwill is expected to be deductible for income tax purposes.

Schedule of intangible assets acquired

The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	138	10
Non-compete agreements	1		1
Total	$	139

The following table reflects the fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:

	Fair value		Life (years)
Customer relationships	$	144	8
Trade names and associated trademarks	5		5
Total	$	149

Summary of business acquisition, pro forma information

The tables below present unaudited pro forma consolidated income statement information as if NES, Neff and BakerCorp had been included in our consolidated results for the entire periods reflected. NES and Neff are excluded from the 2018 table because they are included in our results for the entire nine months ended September 30, 2018.

	Three Months Ended													Nine Months Ended
	September 30, 2017													September 30, 2017
	United Rentals		NES		Neff			BakerCorp			Total			United Rentals		NES			Neff			BakerCorp			Total
Historic/pro forma revenues	$	1,766	$	—	$	111		$	70		$	1,947		$	4,719	$	81		$	312		$	199		$	5,311
Historic/combined pretax income (loss)	322		—		16			(6		)	332			712		(12		)	38			(62		)	676
Pro forma adjustments to pretax income (loss):
Impact of fair value mark-ups/useful life changes on depreciation (1)			—		(3		)	(4		)	(7		)			(9		)	(8		)	(10		)	(27		)
Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales (2)			—		—			—			—					(1		)	(1		)	—			(2		)
Intangible asset amortization (3)			—		(7		)	(8		)	(15		)			(6		)	(21		)	(25		)	(52		)
Goodwill impairment (4)			—		—			—			—					—			—			32			32
Interest expense (5)			—		(17		)	(5		)	(22		)			(9		)	(51		)	(14		)	(74		)
Elimination of historic interest (6)			—		11			10			21					12			34			30			76
Elimination of merger related costs (7)			1		15			—			16					17			15			—			32
Restructuring charges (8)			4		(3		)	—			1					(5		)	(19		)	(6		)	(30		)
Pro forma pretax income											$	326													$	631

	Three Months Ended								Nine Months Ended
	September 30, 2018								September 30, 2018
	United Rentals		BakerCorp			Total			United Rentals		BakerCorp			Total
Historic/pro forma revenues	$	2,116	$	28		$	2,144		$	5,741	$	184		$	5,925
Historic/combined pretax income (loss)	460		(63		)	397			1,051		(84		)	967
Pro forma adjustments to pretax income (loss):
Impact of fair value mark-ups/useful life changes on depreciation (1)			(1		)	(1		)			(8		)	(8		)
Intangible asset amortization (3)			(1		)	(1		)			(16		)	(16		)
Interest expense (5)			(2		)	(2		)			(14		)	(14		)
Elimination of historic interest (6)			9			9					30			30
Elimination of merger related costs (7)			65			65					66			66
Restructuring charges (8)			6			6					6			6
Pro forma pretax income						$	473							$	1,031

(1) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups, and the changes in useful lives and salvage values, of the equipment acquired in the NES, Neff and BakerCorp acquisitions.

(2) Cost of rental equipment sales was adjusted for the fair value mark-ups of rental equipment acquired in the NES and Neff acquisitions. BakerCorp did not historically recognize a material amount of rental equipment sales, and accordingly no adjustment was required for BakerCorp.

(3) The intangible assets acquired in the NES, Neff and BakerCorp acquisitions were amortized.

(4) The goodwill impairment charge that BakerCorp recognized during the nine months ended September 30, 2017 was eliminated. If the acquisition had occurred as of the pro forma acquisition date, this impairment charge would not have been recognized (instead, we would have tested for goodwill impairment based on the post-acquisition reporting unit structure).

(5) As discussed above, we issued debt to partially fund the NES, Neff and BakerCorp acquisitions. Interest expense was adjusted to reflect these changes in our debt portfolio.

(6) Historic interest on debt that is not part of the combined entity was eliminated.

(7) Merger related costs primarily comprised of financial and legal advisory fees associated with the NES, Neff and BakerCorp acquisitions were eliminated as they were assumed to have been recognized prior to the pro forma acquisition date. The adjustments for BakerCorp for the three and nine months ended September 30, 2018 include $57 of merger related costs recognized by BakerCorp prior to the acquisition.

(8) We expect to recognize restructuring charges primarily comprised of severance costs and branch closure charges associated with the acquisitions over a period of approximately one year following the acquisition dates, which, for the pro forma presentation, was January 1, 2017. The adjustments above reflect the timing of the actual restructuring charges following the acquisitions (the pro forma restructuring charges above for the three and nine months ended September 30, 2017 reflect the actual restructuring charges recognized during the three and nine months following the acquisitions). We do not expect to incur significant additional restructuring charges for NES and Neff. We expect to incur additional restructuring charges for BakerCorp, however the remaining costs are not currently estimable, as we are still identifying the actions that will be undertaken.

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Financial information by segment

The following tables set forth financial information by segment.

	General rentals		Trench, power and fluid solutions		Total
Three Months Ended September 30, 2018
Equipment rentals	$	1,444	$	417	$	1,861
Sales of rental equipment	130		10		140
Sales of new equipment	50		4		54
Contractor supplies sales	17		7		24
Service and other revenues	33		4		37
Total revenue	1,674		442		2,116
Depreciation and amortization expense	351		67		418
Equipment rentals gross profit	629		218		847
Three Months Ended September 30, 2017
Equipment rentals	$	1,237	$	299	$	1,536
Sales of rental equipment	130		9		139
Sales of new equipment	34		6		40
Contractor supplies sales	17		4		21
Service and other revenues	26		4		30
Total revenue	1,444		322		1,766
Depreciation and amortization expense	306		47		353
Equipment rentals gross profit	525		164		689
Nine Months Ended September 30, 2018
Equipment rentals	$	3,977	$	974	$	4,951
Sales of rental equipment	446		32		478
Sales of new equipment	125		15		140
Contractor supplies sales	50		16		66
Service and other revenues	95		11		106
Total revenue	4,693		1,048		5,741
Depreciation and amortization expense	1,022		179		1,201
Equipment rentals gross profit	1,598		482		2,080
Capital expenditures	1,845		251		2,096
Nine Months Ended September 30, 2017
Equipment rentals	$	3,357	$	712	$	4,069
Sales of rental equipment	348		30		378
Sales of new equipment	112		14		126
Contractor supplies sales	49		11		60
Service and other revenues	76		10		86
Total revenue	3,942		777		4,719
Depreciation and amortization expense	855		138		993
Equipment rentals gross profit	1,350		359		1,709
Capital expenditures	1,404		168		1,572

	September 30, 2018		December 31, 2017
Total reportable segment assets
General rentals	$	13,766	$	13,351
Trench, power and fluid solutions (1)	2,588		1,679
Total assets	$	16,354	$	15,030

(1) The increase in the trench, power and fluid solutions assets primarily reflects the impact of the BakerCorp acquisition discussed in note 3 to the condensed consolidated financial statements.

Reconciliation to equipment rentals gross profit

The following is a reconciliation of equipment rentals gross profit to income before provision for income taxes:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2018			2017			2018			2017
Total equipment rentals gross profit	$	847		$	689		$	2,080		$	1,709
Gross profit from other lines of business	91			84			286			233
Selling, general and administrative expenses	(265		)	(237		)	(736		)	(648		)
Merger related costs	(11		)	(16		)	(14		)	(32		)
Restructuring charge	(9		)	(9		)	(15		)	(28		)
Non-rental depreciation and amortization	(75		)	(63		)	(213		)	(189		)
Interest expense, net	(118		)	(131		)	(339		)	(338		)
Other income, net	—			5			2			5
Income before provision for income taxes	$	460		$	322		$	1,051		$	712

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Restructuring Charges (Tables)

9 Months Ended

Sep. 30, 2018

Restructuring and Related Activities [Abstract]

Schedule of restructuring reserve by type of cost

The table below provides certain information concerning restructuring activity during the nine months ended September 30, 2018:

	Reserve Balance at		Charged to Costs and Expenses (1)		Payments and Other			Reserve Balance at
	December 31, 2017							September 30, 2018
Closed Restructuring Programs
Branch closure charges	$	13	$	1	$	(4	)	$	10
Severance and other	—		—		—			—
Total	$	13	$	1	$	(4	)	$	10
NES/Neff/Project XL Restructuring Program
Branch closure charges	$	8	$	1	$	(5	)	$	4
Severance and other	12		7		(11		)	8
Total	$	20	$	8	$	(16	)	$	12
BakerCorp Restructuring Program
Branch closure charges	$	—	$	—	$	—		$	—
Severance and other	—		6		(2		)	4
Total	$	—	$	6	$	(2	)	$	4
Total
Branch closure charges	$	21	$	2	$	(9	)	$	14
Severance and other	12		13		(13		)	12
Total	$	33	$	15	$	(22	)	$	26

_________________

(1)    Reflected in our condensed consolidated statements of income as “Restructuring charge.” These charges are not allocated to our reportable segments.

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Goodwill and Other Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

The following table presents the changes in the carrying amount of goodwill for the nine months ended September 30, 2018:

	General rentals			Trench, power and fluid solutions			Total
Balance at January 1, 2018 (1)	$	3,607		$	475		$	4,082
Goodwill related to acquisitions (2)	44			194			238
Foreign currency translation and other adjustments	(6		)	(1		)	(7		)
Balance at September 30, 2018 (1)	3,645			668			4,313

_________________

(1) The total carrying amount of goodwill for all periods in the table above is reflected net of $1.557 billion of accumulated impairment charges, which were primarily recorded in our general rentals segment.

(2) For additional detail on the July 2018 acquisition of BakerCorp, which accounted for most of the goodwill related to acquisitions, see note 3 to our condensed consolidated financial statements.

Schedule of finite-lived intangible assets

Other intangible assets were comprised of the following at September 30, 2018 and December 31, 2017:

	September 30, 2018
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	28 months		$	23		$	17		$	6
Customer relationships	8 years		$	1,897		$	1,013		$	884
Trade names and associated trademarks	5 years		$	5		$	—		$	5

	December 31, 2017
	Weighted-Average Remaining Amortization Period	Gross Carrying Amount			Accumulated Amortization			Net Amount
Non-compete agreements	31 months		$	71		$	62		$	9
Customer relationships	9 years		$	1,750		$	884		$	866

Our other intangibles assets, net at September 30, 2018 include the following assets associated with the acquisition of BakerCorp discussed in note 3 to our condensed consolidated financial statements. No residual value has been assigned to these assets which are being amortized using the sum of the years' digits method, which we believe best reflects the estimated pattern in which the economic benefits will be consumed.

	September 30, 2018
	Weighted-Average Remaining Amortization Period	Net Carrying Amount
Customer relationships	8 years	$	138
Trade names and associated trademarks	5 years	$	5

Schedule of finite-lived intangible assets, future amortization expense

As of September 30, 2018, estimated amortization expense for other intangible assets for each of the next five years and thereafter is as follows:  

2018		$	52
2019	193
2020	167
2021	141
2022	114
Thereafter	228
Total		$	895

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair value of financial instruments

The estimated fair values of our financial instruments, all of which are categorized in Level 1 of the fair value hierarchy, as of September 30, 2018 and December 31, 2017 have been calculated based upon available market information, and were as follows:

	September 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Senior notes	$	7,014	$	7,006	$	7,008	$	7,340

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Debt (Tables)

9 Months Ended

Sep. 30, 2018

Debt Disclosure [Abstract]

Schedule of long-term debt instruments

Debt, net of unamortized original issue discounts or premiums, and unamortized debt issuance costs, consists of the following:

	September 30, 2018			December 31, 2017
Accounts Receivable Securitization Facility expiring 2018 (1)	$	865		$	695
$3.0 billion ABL Facility expiring 2021 (2)	2,120			1,670
4 5/8 percent Senior Secured Notes due 2023	993			992
5 3/4 percent Senior Notes due 2024	842			841
5 1/2 percent Senior Notes due 2025	794			793
4 5/8 percent Senior Notes due 2025	741			740
5 7/8 percent Senior Notes due 2026	999			998
5 1/2 percent Senior Notes due 2027	991			990
4 7/8 percent Senior Notes due 2028 (3)	1,650			1,648
4 7/8 percent Senior Notes due 2028 (3)	4			6
Capital leases	79			67
Total debt	10,078			9,440
Less short-term portion (4)	(896		)	(723		)
Total long-term debt	$	9,182		$	8,717

 ___________________

(1) In June 2018, the accounts receivable securitization facility was amended, primarily to increase the facility size and to extend the maturity date which may be further extended on a 364-day basis by mutual agreement with the purchasers under the facility. The size of the facility, which expires on June 29, 2019, was increased to $875.At September 30, 2018, $9 was available under our accounts receivable securitization facility. The interest rate applicable to the accounts receivable securitization facility was 3.0 percent at September 30, 2018. During the nine months ended September 30, 2018, the monthly average principal amount outstanding under the accounts receivable securitization facility was $788, and the weighted-average interest rate thereon was 2.8 percent. The maximum month-end principal amount outstanding under the accounts receivable securitization facility during the nine months ended September 30, 2018 was $870. Borrowings under the accounts receivable securitization facility are permitted only to the extent that the face amount of the receivables in the collateral pool, net of applicable reserves and other deductions, exceeds the outstanding loans. As of September 30, 2018, there were $1.024 billion of receivables, net of applicable reserves and other deductions, in the collateral pool.

(2) At September 30, 2018, $836 was available under our ABL facility, net of $37 of letters of credit. The interest rate applicable to the ABL facility was 3.7 percent at September 30, 2018. During the nine months ended September 30, 2018, the monthly average principal amount outstanding under the ABL facility was $1.485 billion, and the weighted-average interest rate thereon was 3.4 percent. The maximum month-end principal amount outstanding under the ABL facility during the nine months ended September 30, 2018 was $2.127 billion.

(3) URNA separately issued 4 ⁷/₈ percent Senior Notes in August 2017 and in September 2017. Following the issuances, we consummated an exchange offer pursuant to which most of the 4 ⁷/₈ percent Senior Notes issued in September 2017 were exchanged for additional notes fungible with the 4 ⁷/₈ percent Senior Notes issued in August 2017.

(4) As of September 30, 2018, our short-term debt primarily reflects $865 of borrowings under our accounts receivable securitization facility.

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Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Schedule of earnings per share

The following table sets forth the computation of basic and diluted earnings per share (shares in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Numerator:
Net income available to common stockholders	$	333	$	199	786		449
Denominator:
Denominator for basic earnings per share—weighted-average common shares	82,344		84,663		83,345		84,585
Effect of dilutive securities:
Employee stock options	372		398		389		401
Restricted stock units	456		531		477		488
Denominator for diluted earnings per share—adjusted weighted-average common shares	83,172		85,592		84,211		85,474
Basic earnings per share	$	4.05	$	2.36	$	9.44	$	5.31
Diluted earnings per share	$	4.01	$	2.33	$	9.34	$	5.26

XML

Condensed Consolidating Financial Information of Guarantor Subsidiaries (Tables)

9 Months Ended

Sep. 30, 2018

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET

The condensed consolidating financial information of Parent and its subsidiaries is as follows:

CONDENSED CONSOLIDATING BALANCE SHEET

September 30, 2018

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			Domestic
ASSETS
Cash and cash equivalents	$	—	$	17		$	—		$	48		$	—	$	—		$	65
Accounts receivable, net	—		—			—			141			1,297		—			1,438
Intercompany receivable (payable)	1,325		(1,200		)	(96		)	(29		)	—		—			—
Inventory	—		94			—			10			—		—			104
Prepaid expenses and other assets	—		81			—			4			—		—			85
Total current assets	1,325		(1,008		)	(96		)	174			1,297		—			1,692
Rental equipment, net	—		8,243			—			667			—		—			8,910
Property and equipment, net	51		394			40			44			—		—			529
Investments in subsidiaries	1,973		1,534			966			—			22		(4,495		)	—
Goodwill	—		3,902			—			411			—		—			4,313
Other intangible assets, net	—		812			—			83			—		—			895
Other long-term assets	7		8			—			—			—		—			15
Total assets	$	3,356	$	13,885		$	910		$	1,379		$	1,319	$	(4,495	)	$	16,354
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	28		$	—		$	2		$	865	$	—		$	896
Accounts payable	—		624			—			64			—		—			688
Accrued expenses and other liabilities	—		449			14			38			2		—			503
Total current liabilities	1		1,101			14			104			867		—			2,087
Long-term debt	—		9,170			9			3			—		—			9,182
Deferred taxes	21		1,518			—			89			—		—			1,628
Other long-term liabilities	—		123			—			—			—		—			123
Total liabilities	22		11,912			23			196			867		—			13,020
Total stockholders’ equity (deficit)	3,334		1,973			887			1,183			452		(4,495		)	3,334
Total liabilities and stockholders’ equity (deficit)	$	3,356	$	13,885		$	910		$	1,379		$	1,319	$	(4,495	)	$	16,354

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2017

	Parent		URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign			Domestic
ASSETS
Cash and cash equivalents	$	—	$	23		$	—		$	329		$	—	$	—		$	352
Accounts receivable, net	—		56			—			119			1,058		—			1,233
Intercompany receivable (payable)	887		(677		)	(198		)	(124		)	—		112			—
Inventory	—		68			—			7			—		—			75
Prepaid expenses and other assets	4		219			111			2			—		(224		)	112
Total current assets	891		(311		)	(87		)	333			1,058		(112		)	1,772
Rental equipment, net	—		7,264			—			560			—		—			7,824
Property and equipment, net	41		352			32			42			—		—			467
Investments in subsidiaries	2,194		1,148			1,087			—			—		(4,429		)	—
Goodwill	—		3,815			—			267			—		—			4,082
Other intangible assets, net	—		827			—			48			—		—			875
Other long-term assets	3		7			—			—			—		—			10
Total assets	$	3,129	$	13,102		$	1,032		$	1,250		$	1,058	$	(4,541	)	$	15,030
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	$	1	$	25		$	—		$	2		$	695	$	—		$	723
Accounts payable	—		366			—			43			—		—			409
Accrued expenses and other liabilities	—		477			17			41			1		—			536
Total current liabilities	1		868			17			86			696		—			1,668
Long-term debt	1		8,596			117			3			—		—			8,717
Deferred taxes	21		1,324			—			74			—		—			1,419
Other long-term liabilities	—		120			—			—			—		—			120
Total liabilities	23		10,908			134			163			696		—			11,924
Total stockholders’ equity (deficit)	3,106		2,194			898			1,087			362		(4,541		)	3,106
Total liabilities and stockholders’ equity (deficit)	$	3,129	$	13,102		$	1,032		$	1,250		$	1,058	$	(4,541	)	$	15,030

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	1,715	$	—		$	146	$	—		$	—		$	1,861
Sales of rental equipment	—			128		—			12		—			—			140
Sales of new equipment	—			46		—			8		—			—			54
Contractor supplies sales	—			22		—			2		—			—			24
Service and other revenues	—			32		—			5		—			—			37
Total revenues	—			1,943		—			173		—			—			2,116
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			614		—			57		—			—			671
Depreciation of rental equipment	—			316		—			27		—			—			343
Cost of rental equipment sales	—			76		—			7		—			—			83
Cost of new equipment sales	—			40		—			6		—			—			46
Cost of contractor supplies sales	—			14		—			1		—			—			15
Cost of service and other revenues	—			16		—			4		—			—			20
Total cost of revenues	—			1,076		—			102		—			—			1,178
Gross profit	—			867		—			71		—			—			938
Selling, general and administrative expenses	28			197		—			24		16			—			265
Merger related costs	—			11		—			—		—			—			11
Restructuring charge	—			8		—			1		—			—			9
Non-rental depreciation and amortization	3			65		—			7		—			—			75
Operating (loss) income	(31		)	586		—			39		(16		)	—			578
Interest (income) expense, net	(11		)	122		(1		)	1		7			—			118
Other (income) expense, net	(172		)	196		—			13		(37		)	—			—
Income before provision for income taxes	152			268		1			25		14			—			460
Provision for income taxes	45			71		—			8		3			—			127
Income before equity in net earnings (loss) of subsidiaries	107			197		1			17		11			—			333
Equity in net earnings (loss) of subsidiaries	226			29		17			—		—			(272		)	—
Net income (loss)	333			226		18			17		11			(272		)	333
Other comprehensive income (loss)	18			18		18			18		—			(54		)	18
Comprehensive income (loss)	$	351		$	244	$	36		$	35	$	11		$	(326	)	$	351

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Three Months Ended September 30, 2017

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	1,407	$	—		$	129	$	—		$	—		$	1,536
Sales of rental equipment	—			118		—			21		—			—			139
Sales of new equipment	—			36		—			4		—			—			40
Contractor supplies sales	—			18		—			3		—			—			21
Service and other revenues	—			27		—			3		—			—			30
Total revenues	—			1,606		—			160		—			—			1,766
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			502		—			55		—			—			557
Depreciation of rental equipment	—			266		—			24		—			—			290
Cost of rental equipment sales	—			73		—			11		—			—			84
Cost of new equipment sales	—			31		—			3		—			—			34
Cost of contractor supplies sales	—			12		—			2		—			—			14
Cost of service and other revenues	—			12		—			2		—			—			14
Total cost of revenues	—			896		—			97		—			—			993
Gross profit	—			710		—			63		—			—			773
Selling, general and administrative expenses	42			167		—			19		9			—			237
Merger related costs	—			16		—			—		—			—			16
Restructuring charge	—			8		—			1		—			—			9
Non-rental depreciation and amortization	3			54		—			6		—			—			63
Operating (loss) income	(45		)	465		—			37		(9		)	—			448
Interest (income) expense, net	(5		)	133		1			1		3			(2		)	131
Other (income) expense, net	(144		)	154		—			10		(25		)	—			(5		)
Income (loss) before provision for income taxes	104			178		(1		)	26		13			2			322
Provision for income taxes	39			73		—			7		4			—			123
Income (loss) before equity in net earnings (loss) of subsidiaries	65			105		(1		)	19		9			2			199
Equity in net earnings (loss) of subsidiaries	134			29		19			—		—			(182		)	—
Net income (loss)	199			134		18			19		9			(180		)	199
Other comprehensive income (loss)	42			42		41			33		—			(116		)	42
Comprehensive income (loss)	$	241		$	176	$	59		$	52	$	9		$	(296	)	$	241

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Nine Months EndedSeptember 30, 2018

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations			Total
										Foreign			Domestic
Revenues:
Equipment rentals	$	—		$	4,568		$	—		$	383		$	—		$	—		$	4,951
Sales of rental equipment	—			435			—			43			—			—			478
Sales of new equipment	—			123			—			17			—			—			140
Contractor supplies sales	—			58			—			8			—			—			66
Service and other revenues	—			92			—			14			—			—			106
Total revenues	—			5,276			—			465			—			—			5,741
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			1,710			—			173			—			—			1,883
Depreciation of rental equipment	—			911			—			77			—			—			988
Cost of rental equipment sales	—			259			—			23			—			—			282
Cost of new equipment sales	—			107			—			14			—			—			121
Cost of contractor supplies sales	—			38			—			5			—			—			43
Cost of service and other revenues	—			49			—			9			—			—			58
Total cost of revenues	—			3,074			—			301			—			—			3,375
Gross profit	—			2,202			—			164			—			—			2,366
Selling, general and administrative expenses	33			604			—			66			33			—			736
Merger related costs	—			14			—			—			—			—			14
Restructuring charge	—			14			—			1			—			—			15
Non-rental depreciation and amortization	11			185			—			17			—			—			213
Operating (loss) income	(44		)	1,385			—			80			(33		)	—			1,388
Interest (income) expense, net	(26		)	349			—			—			17			(1		)	339
Other (income) expense, net	(469		)	529			—			37			(99		)	—			(2		)
Income before provision for income taxes	451			507			—			43			49			1			1,051
Provision for income taxes	105			135			—			13			12			—			265
Income before equity in net earnings (loss) of subsidiaries	346			372			—			30			37			1			786
Equity in net earnings (loss) of subsidiaries	440			68			30			—			—			(538		)	—
Net income (loss)	786			440			30			30			37			(537		)	786
Other comprehensive (loss) income	(27		)	(27		)	(28		)	(95		)	—			150			(27		)
Comprehensive income (loss)	$	759		$	413		$	2		$	(65	)	$	37		$	(387	)	$	759

CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME

For the Nine Months EndedSeptember 30, 2017

	Parent			URNA		Guarantor Subsidiaries			Non-Guarantor Subsidiaries					Eliminations			Total
									Foreign		Domestic
Revenues:
Equipment rentals	$	—		$	3,739	$	—		$	330	$	—		$	—		$	4,069
Sales of rental equipment	—			334		—			44		—			—			378
Sales of new equipment	—			113		—			13		—			—			126
Contractor supplies sales	—			53		—			7		—			—			60
Service and other revenues	—			75		—			11		—			—			86
Total revenues	—			4,314		—			405		—			—			4,719
Cost of revenues:
Cost of equipment rentals, excluding depreciation	—			1,397		—			159		—			—			1,556
Depreciation of rental equipment	—			738		—			66		—			—			804
Cost of rental equipment sales	—			202		—			23		—			—			225
Cost of new equipment sales	—			97		—			11		—			—			108
Cost of contractor supplies sales	—			37		—			5		—			—			42
Cost of service and other revenues	—			37		—			5		—			—			42
Total cost of revenues	—			2,508		—			269		—			—			2,777
Gross profit	—			1,806		—			136		—			—			1,942
Selling, general and administrative expenses	84			483		—			57		24			—			648
Merger related costs	—			32		—			—		—			—			32
Restructuring charge	—			27		—			1		—			—			28
Non-rental depreciation and amortization	11			162		—			16		—			—			189
Operating (loss) income	(95		)	1,102		—			62		(24		)	—			1,045
Interest (income) expense, net	(10		)	341		2			1		8			(4		)	338
Other (income) expense, net	(387		)	419		—			33		(70		)	—			(5		)
Income (loss) before provision for income taxes	302			342		(2		)	28		38			4			712
Provision for income taxes	102			140		—			7		14			—			263
Income (loss) before equity in net earnings (loss) of subsidiaries	200			202		(2		)	21		24			4			449
Equity in net earnings (loss) of subsidiaries	249			47		21			—		—			(317		)	—
Net income (loss)	449			249		19			21		24			(313		)	449
Other comprehensive income (loss)	75			75		75			61		—			(211		)	75
Comprehensive income (loss)	$	524		$	324	$	94		$	82	$	24		$	(524	)	$	524

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Nine Months EndedSeptember 30, 2018

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			Domestic
Net cash provided by (used in) operating activities	$	22		$	2,354		$	(1	)	$	(50	)	$	(202	)	$	—	$	2,123
Net cash used in investing activities	(22		)	(2,259		)	—			(112		)	—			—		(2,393		)
Net cash (used in) provided by financing activities	—			(101		)	1			(109		)	202			—		(7		)
Effect of foreign exchange rates	—			—			—			(10		)	—			—		(10		)
Net decrease in cash and cash equivalents	—			(6		)	—			(281		)	—			—		(287		)
Cash and cash equivalents at beginning of period	—			23			—			329			—			—		352
Cash and cash equivalents at end of period	$	—		$	17		$	—		$	48		$	—		$	—	$	65

CONDENSED CONSOLIDATING CASH FLOW INFORMATION

For the Nine Months EndedSeptember 30, 2017

	Parent			URNA			Guarantor Subsidiaries			Non-Guarantor Subsidiaries						Eliminations		Total
										Foreign			Domestic
Net cash provided by (used in) operating activities	$	15		$	1,839		$	(2	)	$	83		$	(179	)	$	—	$	1,756
Net cash used in investing activities	(15		)	(2,135		)	—			(92		)	—			—		(2,242		)
Net cash provided by (used in) financing activities	—			298			2			(2		)	179			—		477
Effect of foreign exchange rates	—			—			—			21			—			—		21
Net increase in cash and cash equivalents	—			2			—			10			—			—		12
Cash and cash equivalents at beginning of period	—			21			—			291			—			—		312
Cash and cash equivalents at end of period	$	—		$	23		$	—		$	301		$	—		$	—	$	324

XML

Organization, Description of Business and Basis of Presentation (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Sep. 30, 2018	Dec. 31, 2017
Business Acquisition [Line Items]
Provisional income tax expense (benefit)			$ (689)
Measurement period adjustment, income tax expense (benefit)	$ 6	$ 6
Owned equipment rentals | Equipment rental revenue | Product concentration risk
Business Acquisition [Line Items]
Concentration risk, percentage		86.00%

XML

Revenue Recognition (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenues:
Owned equipment rentals	$ 1,861	$ 1,536	$ 4,951	$ 4,069
Re-rent revenue	41	32	95	78
Ancillary and other rental revenues:
Delivery and pick-up	132	107	336	279
Other	99	77	260	204
Total ancillary and other rental revenues	231	184	596	483
Total equipment rentals	1,861	1,536	4,951	4,069
Service and other revenues	37	30	106	86
Total revenues	2,116	1,766	5,741	4,719
Topic 840
Revenues:
Re-rent revenue	41	32	95	78
Ancillary and other rental revenues:
Delivery and pick-up	0	0	0	0
Other	78	61	198	160
Total ancillary and other rental revenues	78	61	198	160
Total equipment rentals	1,708	1,413	4,553	3,746
Service and other revenues	0	0	0	0
Total revenues	1,708	1,413	4,553	3,746
Topic 606
Revenues:
Re-rent revenue	0		0
Ancillary and other rental revenues:
Delivery and pick-up	132		336
Other	21		62
Total ancillary and other rental revenues	153		398
Total equipment rentals	153		398
Service and other revenues	37		106
Total revenues	408		1,188
Topic 605
Revenues:
Re-rent revenue		0		0
Ancillary and other rental revenues:
Delivery and pick-up		107		279
Other		16		44
Total ancillary and other rental revenues		123		323
Total equipment rentals		123		323
Service and other revenues		30		86
Total revenues		353		973
Owned equipment rentals
Revenues:
Owned equipment rentals	1,589	1,320	4,260	3,508
Owned equipment rentals | Topic 840
Revenues:
Owned equipment rentals	1,589	1,320	4,260	3,508
Owned equipment rentals | Topic 606
Revenues:
Owned equipment rentals	0		0
Owned equipment rentals | Topic 605
Revenues:
Owned equipment rentals		0		0
Rental equipment
Ancillary and other rental revenues:
Sales revenue	140	139	478	378
Rental equipment | Topic 840
Ancillary and other rental revenues:
Sales revenue	0	0	0	0
Rental equipment | Topic 606
Ancillary and other rental revenues:
Sales revenue	140		478
Rental equipment | Topic 605
Ancillary and other rental revenues:
Sales revenue		139		378
New equipment
Ancillary and other rental revenues:
Sales revenue	54	40	140	126
New equipment | Topic 840
Ancillary and other rental revenues:
Sales revenue	0	0	0	0
New equipment | Topic 606
Ancillary and other rental revenues:
Sales revenue	54		140
New equipment | Topic 605
Ancillary and other rental revenues:
Sales revenue		40		126
Contractor supplies
Ancillary and other rental revenues:
Sales revenue	24	21	66	60
Contractor supplies | Topic 840
Ancillary and other rental revenues:
Sales revenue	0	0	0	0
Contractor supplies | Topic 606
Ancillary and other rental revenues:
Sales revenue	$ 24		$ 66
Contractor supplies | Topic 605
Ancillary and other rental revenues:
Sales revenue		$ 21		$ 60

XML

Revenue Recognition (Narrative) (Details) - USD ($)			3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Deferred revenue	$ 58,000,000	$ 46,000,000	$ 58,000,000		$ 58,000,000		$ 46,000,000
Provision for doubtful accounts					27,000,000	$ 24,000,000
Contract with customer, asset	0		0		0
Contract with customer, asset, impairment losses					0
Contract with customer, liability	$ 0		0		0
Revenue recognized			0	$ 0	$ 0	0
Revenues | Largest customer | Customer concentration risk
Property, Plant and Equipment [Line Items]
Percentage of equipment rental revenue					1.00%		1.00%	1.00%	1.00%
Concentration risk					1.00%		1.00%	1.00%	1.00%
Accounts receivable | Customer concentration risk
Property, Plant and Equipment [Line Items]
Percentage of equipment rental revenue	1.00%	1.00%
Concentration risk	1.00%	1.00%
Rental equipment
Property, Plant and Equipment [Line Items]
Sales revenue			140,000,000	139,000,000	$ 478,000,000	378,000,000
US | Revenues | Geographic Concentration Risk
Property, Plant and Equipment [Line Items]
Percentage of equipment rental revenue					92.00%
Concentration risk					92.00%
Topic 840 | Revenues | Product concentration risk
Property, Plant and Equipment [Line Items]
Percentage of equipment rental revenue					79.00%
Concentration risk					79.00%
Topic 840 | Rental equipment
Property, Plant and Equipment [Line Items]
Sales revenue			0	0	$ 0	0
Topic 606 | Rental equipment
Property, Plant and Equipment [Line Items]
Sales revenue				139,000,000		378,000,000
General rentals | Revenues | Product concentration risk
Property, Plant and Equipment [Line Items]
Percentage of equipment rental revenue					82.00%
Concentration risk					82.00%
General rentals | Rental equipment
Property, Plant and Equipment [Line Items]
Sales revenue			130,000,000	130,000,000	$ 446,000,000	348,000,000
Pro Forma | Topic 605 | ASU 2014-09 | Rental equipment
Property, Plant and Equipment [Line Items]
Sales revenue				(14,000,000)
Transferred at point in time | Topic 606
Property, Plant and Equipment [Line Items]
Revenue from contract with customer			$ 0	$ 0	$ 0	$ 0

XML

Acquisitions (Narrative) (Details) $ in Millions	1 Months Ended			3 Months Ended	9 Months Ended
	Jul. 31, 2018 USD ($) employee location	Oct. 31, 2017 USD ($) branch state	Apr. 30, 2017 USD ($) branch	Sep. 30, 2018 USD ($)	Sep. 30, 2018 USD ($)	Dec. 31, 2017 USD ($)	Sep. 30, 2017 USD ($) employee	Dec. 31, 2016 USD ($) employee
Business Acquisition [Line Items]
Rental equipment, net				$ 8,910	$ 8,910	$ 7,824
Increase in volume of OEC on rent (as a percent)				17.80%	19.60%
NES Rentals Holdings II, Inc.
Business Acquisition [Line Items]
Revenue reported by acquired entity for last annual period			$ 369
Aggregate consideration paid			$ 960
Neff Corporation
Business Acquisition [Line Items]
Revenue reported by acquired entity for last annual period		$ 413
Aggregate consideration paid		1,316
Equity interests issued and issuable		$ 7
BakerCorp
Business Acquisition [Line Items]
Revenue reported by acquired entity for last annual period	$ 295
Aggregate consideration paid	$ 724
NES Rentals Holdings II, Inc.
Business Acquisition [Line Items]
Number of rental locations (branch) | branch			73
Number of employees | employee								1,100
Rental equipment, net								$ 900
Neff Corporation
Business Acquisition [Line Items]
Number of rental locations (branch) | branch		69
Number of employees | employee							1,100
Rental equipment, net							$ 860
Number of states | state		14
BakerCorp
Business Acquisition [Line Items]
Number of employees | employee	950
United States And Canada | BakerCorp
Business Acquisition [Line Items]
Number of rental locations (branch) | location	46
France, Germany, United Kingdom And Netherlands | BakerCorp
Business Acquisition [Line Items]
Number of rental locations (branch) | location	11

XML

Acquisitions (Assets Acquired and Liabilities Assumed - NES Acquisition) (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017	Apr. 30, 2017
Business Acquisition [Line Items]
Goodwill	$ 4,313	$ 4,082
NES Rentals Holdings II, Inc.
Business Acquisition [Line Items]
Accounts receivable, net of allowance for doubtful accounts			$ 49
Inventory			4
Rental equipment			571
Property and equipment			48
Intangibles			139
Other assets			7
Total identifiable assets acquired			818
Short-term debt and current maturities of long-term debt			(3)
Current liabilities			(33)
Deferred taxes			(15)
Long-term debt			(11)
Other long-term liabilities			(5)
Total liabilities assumed			(67)
Net identifiable assets acquired			751
Goodwill			209
Net assets acquired			960
Gross contractual amount			53
Estimated amount uncollectible			4
Goodwill, amount expected to be deductible for income tax purposes			$ 1

XML

Acquisitions (Acquired Intangible Assets - NES Acquisition) (Details) - NES Rentals Holdings II, Inc. $ in Millions	1 Months Ended
	Apr. 30, 2017 USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]
Fair value	$ 139
Customer relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Fair value	$ 138
Life (years)	10 years
Non-compete agreements
Acquired Finite-Lived Intangible Assets [Line Items]
Fair value	$ 1
Life (years)	1 year

XML

Acquisitions (Assets Acquired and Liabilities Assumed - Neff Acquisition) (Details) - USD ($) $ in Millions	1 Months Ended
	Oct. 31, 2017	Sep. 30, 2018	Dec. 31, 2017
Business Acquisition [Line Items]
Goodwill		$ 4,313	$ 4,082
Neff Corporation
Business Acquisition [Line Items]
Accounts receivable, net of allowance for doubtful accounts	$ 72
Inventory	5
Rental equipment	550
Property and equipment	45
Intangibles (customer relationships)	153
Other assets	5
Total identifiable assets acquired	830
Current liabilities	(62)
Deferred taxes	(36)
Other long-term liabilities	(3)
Total liabilities assumed	(101)
Net identifiable assets acquired	729
Goodwill	587
Net assets acquired	1,316
Gross contractual amount	74
Estimated amount uncollectible	2
Goodwill, amount expected to be deductible for income tax purposes	$ 320
Customer relationships | Neff Corporation
Business Acquisition [Line Items]
Life (years)	10 years

XML

Acquisitions Acquisitions (Assets Acquired and Liabilities Assumed - BakerCorp Acquisition) (Details) - USD ($) $ in Millions	Sep. 30, 2018	Jul. 31, 2018	Dec. 31, 2017
Business Acquisition [Line Items]
Goodwill	$ 4,313		$ 4,082
BakerCorp
Business Acquisition [Line Items]
Accounts receivable, net of allowance for doubtful accounts		$ 73
Inventory		5
Rental equipment		352
Property and equipment		27
Intangibles		149
Other assets		5
Total identifiable assets acquired		611
Current liabilities		(61)
Deferred taxes		(20)
Total liabilities assumed		(81)
Net identifiable assets acquired		530
Goodwill		194
Net assets acquired		724
Gross contractual amount		79
Estimated amount uncollectible		6
Goodwill, amount expected to be deductible for income tax purposes		$ 7

XML

Acquisitions (Acquired Intangible Assets - BakerCorp Acquisition) (Details) - BakerCorp $ in Millions	Jul. 31, 2018 USD ($)
Business Acquisition [Line Items]
Intangibles	$ 149
Customer relationships
Business Acquisition [Line Items]
Intangibles	$ 144
Life (years)	8 years
Trade names and associated trademarks
Business Acquisition [Line Items]
Intangibles	$ 5
Life (years)	5 years

XML

Acquisitions (Pro Forma Information) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Revenues	$ 2,116	$ 1,766	$ 5,741	$ 4,719
Pro forma revenues	2,144	1,947	5,925	5,311
Historic/combined pretax income (loss)	460	322	1,051	712
Combined pretax income	397	332	967	676
Pro forma pretax income	473	326	1,031	631
Merger related costs	11	16	14	32
Impact of fair value mark-ups/useful life changes on depreciation
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income	(1)	(7)	(8)	(27)
Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income		0		(2)
Intangible asset amortization
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income	(1)	(15)	(16)	(52)
Goodwill impairment
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income		0		32
Interest expense
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income	(2)	(22)	(14)	(74)
Elimination of historic interest
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income	9	21	30	76
Elimination of merger related costs
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income	65	16	66	32
Restructuring charges
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Combined pretax income	6	1	6	(30)
NES
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Revenues		0		81
Historic/combined pretax income (loss)		0		(12)
NES | Impact of fair value mark-ups/useful life changes on depreciation
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		(9)
NES | Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		(1)
NES | Intangible asset amortization
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		(6)
NES | Goodwill impairment
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		0
NES | Interest expense
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		(9)
NES | Elimination of historic interest
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		12
NES | Elimination of merger related costs
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		1		17
NES | Restructuring charges
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		4		(5)
Neff
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Revenues		111		312
Historic/combined pretax income (loss)		16		38
Neff | Impact of fair value mark-ups/useful life changes on depreciation
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		(3)		(8)
Neff | Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		(1)
Neff | Intangible asset amortization
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		(7)		(21)
Neff | Goodwill impairment
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		0
Neff | Interest expense
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		(17)		(51)
Neff | Elimination of historic interest
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		11		34
Neff | Elimination of merger related costs
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		15		15
Neff | Restructuring charges
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		(3)		(19)
BakerCorp
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Revenues	28	70	184	199
Historic/combined pretax income (loss)	(63)	(6)	(84)	(62)
Merger related costs	57		57
BakerCorp | Impact of fair value mark-ups/useful life changes on depreciation
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)	(1)	(4)	(8)	(10)
BakerCorp | Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		0
BakerCorp | Intangible asset amortization
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)	(1)	(8)	(16)	(25)
BakerCorp | Goodwill impairment
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)		0		32
BakerCorp | Interest expense
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)	(2)	(5)	(14)	(14)
BakerCorp | Elimination of historic interest
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)	9	10	30	30
BakerCorp | Elimination of merger related costs
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)	65	0	66	0
BakerCorp | Restructuring charges
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Historic/combined pretax income (loss)	$ 6	$ 0	$ 6	$ (6)

XML

Segment Information (Financial Information by Segment) (Details) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018 USD ($) region	Sep. 30, 2017 USD ($)	Sep. 30, 2018 USD ($) region	Sep. 30, 2017 USD ($)	Dec. 31, 2017 USD ($)
Segment Reporting Information
Equipment rentals	$ 1,861	$ 1,536	$ 4,951	$ 4,069
Service and other revenues	37	30	106	86
Total revenues	2,116	1,766	5,741	4,719
Depreciation and amortization expense	418	353	1,201	993
Gross profit	938	773	2,366	1,942
Capital expenditures			2,096	1,572
Assets	16,354		16,354		$ 15,030
Rental equipment
Segment Reporting Information
Sales revenue	140	139	478	378
New equipment
Segment Reporting Information
Sales revenue	54	40	140	126
Contractor supplies
Segment Reporting Information
Sales revenue	24	21	66	60
Equipment rentals under operating lease
Segment Reporting Information
Gross profit	$ 847	689	$ 2,080	1,709
General rentals
Segment Reporting Information
Number of geographic regions entity operates in (locations) | region	11		11
Equipment rentals	$ 1,444	1,237	$ 3,977	3,357
Service and other revenues	33	26	95	76
Total revenues	1,674	1,444	4,693	3,942
Depreciation and amortization expense	351	306	1,022	855
Capital expenditures			1,845	1,404
Assets	13,766		13,766		13,351
General rentals | Rental equipment
Segment Reporting Information
Sales revenue	130	130	446	348
General rentals | New equipment
Segment Reporting Information
Sales revenue	50	34	125	112
General rentals | Contractor supplies
Segment Reporting Information
Sales revenue	17	17	50	49
General rentals | Equipment rentals under operating lease
Segment Reporting Information
Gross profit	629	525	1,598	1,350
Trench, power and fluid solutions
Segment Reporting Information
Equipment rentals	417	299	974	712
Service and other revenues	4	4	11	10
Total revenues	442	322	1,048	777
Depreciation and amortization expense	67	47	179	138
Capital expenditures			251	168
Assets	2,588		2,588		$ 1,679
Trench, power and fluid solutions | Rental equipment
Segment Reporting Information
Sales revenue	10	9	32	30
Trench, power and fluid solutions | New equipment
Segment Reporting Information
Sales revenue	4	6	15	14
Trench, power and fluid solutions | Contractor supplies
Segment Reporting Information
Sales revenue	7	4	16	11
Trench, power and fluid solutions | Equipment rentals under operating lease
Segment Reporting Information
Gross profit	$ 218	$ 164	$ 482	$ 359

XML

Segment Information (Reconciliation to Income (loss) from Continuing Operations) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Gross profit	$ 938	$ 773	$ 2,366	$ 1,942
Selling, general and administrative expenses	(265)	(237)	(736)	(648)
Merger related costs	(11)	(16)	(14)	(32)
Restructuring charge	(9)	(9)	(15)	(28)
Non-rental depreciation and amortization	(75)	(63)	(213)	(189)
Interest expense, net	(118)	(131)	(339)	(338)
Other income, net	0	5	2	5
Income before provision for income taxes	460	322	1,051	712
Equipment rentals under operating lease
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Gross profit	847	689	2,080	1,709
Other lines of business
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Gross profit	$ 91	$ 84	$ 286	$ 233

XML

Restructuring Charges (Narrative) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2018 USD ($) work_stream restructuring_program
Restructuring Cost and Reserve
Restructuring costs incurred to date | $	$ 299
Closed Restructuring Programs
Restructuring Cost and Reserve
Number of restructuring programs | restructuring_program	3
NES/Neff/Project XL Restructuring Program
Restructuring Cost and Reserve
Number of specific work streams | work_stream	8

XML

Restructuring Charges (Schedule of restructuring charges) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			$ 33
Charged to Costs and Expenses	$ 9	$ 9	15	$ 28
Payments and Other			(22)
Ending Reserve Balance	26		26
Branch closure charges
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			21
Charged to Costs and Expenses			2
Payments and Other			(9)
Ending Reserve Balance	14		14
Severance and other
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			12
Charged to Costs and Expenses			13
Payments and Other			(13)
Ending Reserve Balance	12		12
Closed Restructuring Programs
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			13
Charged to Costs and Expenses			1
Payments and Other			(4)
Ending Reserve Balance	10		10
Closed Restructuring Programs | Branch closure charges
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			13
Charged to Costs and Expenses			1
Payments and Other			(4)
Ending Reserve Balance	10		10
Closed Restructuring Programs | Severance and other
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			0
Charged to Costs and Expenses			0
Payments and Other			0
Ending Reserve Balance	0		0
NES/Neff/Project XL Restructuring Program
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			20
Charged to Costs and Expenses			8
Payments and Other			(16)
Ending Reserve Balance	12		12
NES/Neff/Project XL Restructuring Program | Branch closure charges
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			8
Charged to Costs and Expenses			1
Payments and Other			(5)
Ending Reserve Balance	4		4
NES/Neff/Project XL Restructuring Program | Severance and other
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			12
Charged to Costs and Expenses			7
Payments and Other			(11)
Ending Reserve Balance	8		8
BakerCorp Restructuring Program
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			0
Charged to Costs and Expenses			6
Payments and Other			(2)
Ending Reserve Balance	4		4
BakerCorp Restructuring Program | Branch closure charges
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			0
Charged to Costs and Expenses			0
Payments and Other			0
Ending Reserve Balance	0		0
BakerCorp Restructuring Program | Severance and other
Restructuring Reserve [Roll Forward]
Beginning Reserve Balance			0
Charged to Costs and Expenses			6
Payments and Other			(2)
Ending Reserve Balance	$ 4		$ 4

XML

Goodwill and Other Intangible Assets (Goodwill) (Details) $ in Millions	9 Months Ended
	Sep. 30, 2018 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 4,082
Goodwill related to acquisitions	238
Foreign currency translation and other adjustments	(7)
Ending balance	4,313
General rentals
Goodwill [Roll Forward]
Beginning balance	3,607
Goodwill related to acquisitions	44
Foreign currency translation and other adjustments	(6)
Ending balance	3,645
Goodwill accumulated impairment loss	1,557
Trench, power and fluid solutions
Goodwill [Roll Forward]
Beginning balance	475
Goodwill related to acquisitions	194
Foreign currency translation and other adjustments	(1)
Ending balance	$ 668

XML

Goodwill and Other Intangible Assets (Other Intangible Assets) (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Net Amount	$ 895	$ 875
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	28 months	31 months
Gross Carrying Amount	$ 23	$ 71
Accumulated Amortization	17	62
Net Amount	$ 6	$ 9
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	8 years	9 years
Gross Carrying Amount	$ 1,897	$ 1,750
Accumulated Amortization	1,013	884
Net Amount	$ 884	$ 866
Trade names and associated trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	5 years
Gross Carrying Amount	$ 5
Accumulated Amortization	0
Net Amount	$ 5

XML

Goodwill and Other Intangible Assets (Other Intangible Assets Associated with Acquisition) (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount	$ 895,000,000	$ 875,000,000
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	8 years	9 years
Net Carrying Amount	$ 884,000,000	$ 866,000,000
Trade names and associated trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	5 years
Net Carrying Amount	$ 5,000,000
BakerCorp
Finite-Lived Intangible Assets [Line Items]
Residual value	$ 0
BakerCorp | Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	8 years
Net Carrying Amount	$ 138,000,000
BakerCorp | Trade names and associated trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted-Average Remaining Amortization Period	5 years
Net Carrying Amount	$ 5,000,000

XML

Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 52	$ 41	$ 145	$ 125

XML

Goodwill and Other Intangible Assets (Maturity Schedule) (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
2018	$ 52
2019	193
2020	167
2021	141
2022	114
Thereafter	228
Net Amount	$ 895	$ 875

XML

Fair Value Measurements (Fair value of financial instruments) (Details) - Senior notes - Level 1 - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions
Senior notes	$ 7,014	$ 7,008
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions
Senior notes	$ 7,006	$ 7,340

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Debt (Schedule of long-term debt instruments) (Details) - USD ($)	1 Months Ended	9 Months Ended
	Jun. 30, 2018	Sep. 30, 2018	Dec. 31, 2017
Debt Instrument
Total debt		$ 10,078,000,000	$ 9,440,000,000
Less short-term portion		(896,000,000)	(723,000,000)
Total long-term debt		9,182,000,000	8,717,000,000
Line of Credit | $3.0 billion ABL Facility expiring 2021
Debt Instrument
Total debt		2,120,000,000	1,670,000,000
Maximum borrowing capacity		3,000,000,000
Remaining borrowing capacity under credit facility		$ 836,000,000
Credit facility interest rate at period end		3.70%
Letters of credit outstanding		$ 37,000,000
Average outstanding amount		$ 1,485,000,000
Weighted average interest rate, long-term		3.40%
ABL Facility maximum month-end outstanding amount		$ 2,127,000,000
Senior notes | 4 5/8 percent Senior Secured Notes
Debt Instrument
Stated interest rate		4.625%
Total debt		$ 993,000,000	992,000,000
Senior notes | 5 3/4 percent Senior Notes due 2024
Debt Instrument
Stated interest rate		5.75%
Total debt		$ 842,000,000	841,000,000
Senior notes | 5 1/2 percent Senior Notes due 2025
Debt Instrument
Stated interest rate		5.50%
Total debt		$ 794,000,000	793,000,000
Senior notes | 4 5/8 percent Senior Notes due 2025
Debt Instrument
Stated interest rate		4.625%
Total debt		$ 741,000,000	740,000,000
Senior notes | 5 7/8 percent Senior Notes due 2026
Debt Instrument
Stated interest rate		5.875%
Total debt		$ 999,000,000	998,000,000
Senior notes | 5 1/2 percent Senior Notes due 2027
Debt Instrument
Stated interest rate		5.50%
Total debt		$ 991,000,000	990,000,000
Senior notes | 4 7/8 percent Senior Notes due 2028
Debt Instrument
Stated interest rate		4.875%
Total debt		$ 1,650,000,000	1,648,000,000
Senior notes | 4 7/8 percent Senior Notes due 2028
Debt Instrument
Stated interest rate		4.875%
Total debt		$ 4,000,000	6,000,000
Capital lease obligations
Debt Instrument
Total debt		79,000,000	67,000,000
Line of Credit | Accounts Receivable Securitization Facility expiring 2018
Debt Instrument
Total debt		865,000,000	$ 695,000,000
Short term debt extension period	364 days
Maximum borrowing capacity		875,000,000
Remaining borrowing capacity under credit facility		$ 9,000,000
Credit facility interest rate at period end		3.00%
Average outstanding amount under facility		$ 788,000,000
Weighted average interest rate, short-term		2.80%
A/R Securitization maximum month-end outstanding amount		$ 870,000,000
Collateral amount		$ 1,024,000,000

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Debt (Narrative) (Details)	9 Months Ended
	Sep. 30, 2018
Line of Credit | ABL Facility
Debt Instrument
Minimum available borrowing capacity, percentage	10.00%

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Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Numerator:
Net income available to common stockholders	$ 333	$ 199	$ 786	$ 449
Denominator:
Denominator for basic earnings per share—weighted-average common shares (in shares)	82,344	84,663	83,345	84,585
Effect of dilutive securities:
Denominator for diluted earnings per share—adjusted weighted-average common shares (in shares)	83,172	85,592	84,211	85,474
Basic earnings per share (in dollars per share)	$ 4.05	$ 2.36	$ 9.44	$ 5.31
Diluted earnings per share (in dollars per share)	$ 4.01	$ 2.33	$ 9.34	$ 5.26
Employee stock options
Effect of dilutive securities:
Effect of dilutive securities (in shares)	372	398	389	401
Restricted stock units
Effect of dilutive securities:
Effect of dilutive securities (in shares)	456	531	477	488

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Condensed Consolidating Financial Information of Guarantor Subsidiaries - CONDENSED CONSOLIDATING BALANCE SHEET (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Dec. 31, 2016
ASSETS
Cash and cash equivalents	$ 65	$ 352	$ 324	$ 312
Accounts receivable, net	1,438	1,233
Intercompany receivable (payable)	0	0
Inventory	104	75
Prepaid expenses and other assets	85	112
Total current assets	1,692	1,772
Rental equipment, net	8,910	7,824
Property and equipment, net	529	467
Investments in subsidiaries	0	0
Goodwill	4,313	4,082
Other intangible assets, net	895	875
Other long-term assets	15	10
Total assets	16,354	15,030
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	896	723
Accounts payable	688	409
Accrued expenses and other liabilities	503	536
Total current liabilities	2,087	1,668
Long-term debt	9,182	8,717
Deferred taxes	1,628	1,419
Other long-term liabilities	123	120
Total liabilities	13,020	11,924
Total stockholders’ equity (deficit)	3,334	3,106
Total liabilities and stockholders’ equity (deficit)	16,354	15,030
Eliminations
ASSETS
Cash and cash equivalents	0	0	0	0
Accounts receivable, net	0	0
Intercompany receivable (payable)	0	112
Inventory	0	0
Prepaid expenses and other assets	0	(224)
Total current assets	0	(112)
Rental equipment, net	0	0
Property and equipment, net	0	0
Investments in subsidiaries	(4,495)	(4,429)
Goodwill	0	0
Other intangible assets, net	0	0
Other long-term assets	0	0
Total assets	(4,495)	(4,541)
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	0	0
Accounts payable	0	0
Accrued expenses and other liabilities	0	0
Total current liabilities	0	0
Long-term debt	0	0
Deferred taxes	0	0
Other long-term liabilities	0	0
Total liabilities	0	0
Total stockholders’ equity (deficit)	(4,495)	(4,541)
Total liabilities and stockholders’ equity (deficit)	(4,495)	(4,541)
Parent | Reportable Legal Entities
ASSETS
Cash and cash equivalents	0	0	0	0
Accounts receivable, net	0	0
Intercompany receivable (payable)	1,325	887
Inventory	0	0
Prepaid expenses and other assets	0	4
Total current assets	1,325	891
Rental equipment, net	0	0
Property and equipment, net	51	41
Investments in subsidiaries	1,973	2,194
Goodwill	0	0
Other intangible assets, net	0	0
Other long-term assets	7	3
Total assets	3,356	3,129
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	1	1
Accounts payable	0	0
Accrued expenses and other liabilities	0	0
Total current liabilities	1	1
Long-term debt	0	1
Deferred taxes	21	21
Other long-term liabilities	0	0
Total liabilities	22	23
Total stockholders’ equity (deficit)	3,334	3,106
Total liabilities and stockholders’ equity (deficit)	3,356	3,129
URNA | Reportable Legal Entities
ASSETS
Cash and cash equivalents	17	23	23	21
Accounts receivable, net	0	56
Intercompany receivable (payable)	(1,200)	(677)
Inventory	94	68
Prepaid expenses and other assets	81	219
Total current assets	(1,008)	(311)
Rental equipment, net	8,243	7,264
Property and equipment, net	394	352
Investments in subsidiaries	1,534	1,148
Goodwill	3,902	3,815
Other intangible assets, net	812	827
Other long-term assets	8	7
Total assets	13,885	13,102
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	28	25
Accounts payable	624	366
Accrued expenses and other liabilities	449	477
Total current liabilities	1,101	868
Long-term debt	9,170	8,596
Deferred taxes	1,518	1,324
Other long-term liabilities	123	120
Total liabilities	11,912	10,908
Total stockholders’ equity (deficit)	1,973	2,194
Total liabilities and stockholders’ equity (deficit)	13,885	13,102
Guarantor Subsidiaries | Reportable Legal Entities
ASSETS
Cash and cash equivalents	0	0	0	0
Accounts receivable, net	0	0
Intercompany receivable (payable)	(96)	(198)
Inventory	0	0
Prepaid expenses and other assets	0	111
Total current assets	(96)	(87)
Rental equipment, net	0	0
Property and equipment, net	40	32
Investments in subsidiaries	966	1,087
Goodwill	0	0
Other intangible assets, net	0	0
Other long-term assets	0	0
Total assets	910	1,032
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	0	0
Accounts payable	0	0
Accrued expenses and other liabilities	14	17
Total current liabilities	14	17
Long-term debt	9	117
Deferred taxes	0	0
Other long-term liabilities	0	0
Total liabilities	23	134
Total stockholders’ equity (deficit)	887	898
Total liabilities and stockholders’ equity (deficit)	910	1,032
Non-Guarantor Subsidiaries - Foreign | Reportable Legal Entities
ASSETS
Cash and cash equivalents	48	329	301	291
Accounts receivable, net	141	119
Intercompany receivable (payable)	(29)	(124)
Inventory	10	7
Prepaid expenses and other assets	4	2
Total current assets	174	333
Rental equipment, net	667	560
Property and equipment, net	44	42
Investments in subsidiaries	0	0
Goodwill	411	267
Other intangible assets, net	83	48
Other long-term assets	0	0
Total assets	1,379	1,250
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	2	2
Accounts payable	64	43
Accrued expenses and other liabilities	38	41
Total current liabilities	104	86
Long-term debt	3	3
Deferred taxes	89	74
Other long-term liabilities	0	0
Total liabilities	196	163
Total stockholders’ equity (deficit)	1,183	1,087
Total liabilities and stockholders’ equity (deficit)	1,379	1,250
Non-Guarantor Subsidiaries - Domestic | Reportable Legal Entities
ASSETS
Cash and cash equivalents	0	0	$ 0	$ 0
Accounts receivable, net	1,297	1,058
Intercompany receivable (payable)	0	0
Inventory	0	0
Prepaid expenses and other assets	0	0
Total current assets	1,297	1,058
Rental equipment, net	0	0
Property and equipment, net	0	0
Investments in subsidiaries	22	0
Goodwill	0	0
Other intangible assets, net	0	0
Other long-term assets	0	0
Total assets	1,319	1,058
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Short-term debt and current maturities of long-term debt	865	695
Accounts payable	0	0
Accrued expenses and other liabilities	2	1
Total current liabilities	867	696
Long-term debt	0	0
Deferred taxes	0	0
Other long-term liabilities	0	0
Total liabilities	867	696
Total stockholders’ equity (deficit)	452	362
Total liabilities and stockholders’ equity (deficit)	1,319	$ 1,058
ABL Facility
Condensed Financial Information Other Details [Abstract]
Line of credit facility, restricted payment capacity	2,034
ABL Facility | URNA
Condensed Financial Information Other Details [Abstract]
Line of credit facility, restricted payment capacity	$ 709
Senior notes | 5 3/4 percent Senior Notes due 2024
Condensed Financial Information Other Details [Abstract]
Stated interest rate	5.75%
URNA | URNA
Condensed Financial Information Other Details [Abstract]
Ownership percentage in subsidiaries	100.00%
URNA | Guarantor Subsidiaries
Condensed Financial Information Other Details [Abstract]
Ownership percentage in subsidiaries	100.00%

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Condensed Consolidating Financial Information of Guarantor Subsidiaries - CONDENSED CONSOLIDATING STATEMENT OF INCOME AND COMPREHENSIVE INCOME (Details) - USD ($) $ in Millions		3 Months Ended		9 Months Ended
		Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Revenues:
Equipment rentals		$ 1,861	$ 1,536	$ 4,951	$ 4,069
Service and other revenues		37	30	106	86
Total revenues		2,116	1,766	5,741	4,719
Cost of revenues:
Cost of equipment rentals, excluding depreciation		671	557	1,883	1,556
Depreciation of rental equipment		343	290	988	804
Cost of service and other revenues		20	14	58	42
Total cost of revenues		1,178	993	3,375	2,777
Gross profit		938	773	2,366	1,942
Selling, general and administrative expenses		265	237	736	648
Merger related costs		11	16	14	32
Restructuring charge		9	9	15	28
Non-rental depreciation and amortization		75	63	213	189
Operating (loss) income		578	448	1,388	1,045
Interest (income) expense, net		118	131	339	338
Other (income) expense, net		0	(5)	(2)	(5)
Income before provision for income taxes		460	322	1,051	712
Provision for income taxes		127	123	265	263
Income (loss) before equity in net earnings (loss) of subsidiaries		333	199	786	449
Equity in net earnings (loss) of subsidiaries		0	0	0	0
Net income		333	199	786	449
Other comprehensive (loss) income		18	42	(27)	75
Comprehensive income (loss)	[1]	351	241	759	524
Eliminations
Revenues:
Equipment rentals		0	0	0	0
Service and other revenues		0	0	0	0
Total revenues		0	0	0	0
Cost of revenues:
Cost of equipment rentals, excluding depreciation		0	0	0	0
Depreciation of rental equipment		0	0	0	0
Cost of service and other revenues		0	0	0	0
Total cost of revenues		0	0	0	0
Gross profit		0	0	0	0
Selling, general and administrative expenses		0	0	0	0
Merger related costs		0	0	0	0
Restructuring charge		0	0	0	0
Non-rental depreciation and amortization		0	0	0	0
Operating (loss) income		0	0	0	0
Interest (income) expense, net		0	(2)	(1)	(4)
Other (income) expense, net		0	0	0	0
Income before provision for income taxes		0	2	1	4
Provision for income taxes		0	0	0	0
Income (loss) before equity in net earnings (loss) of subsidiaries		0	2	1	4
Equity in net earnings (loss) of subsidiaries		(272)	(182)	(538)	(317)
Net income		(272)	(180)	(537)	(313)
Other comprehensive (loss) income		(54)	(116)	150	(211)
Comprehensive income (loss)		(326)	(296)	(387)	(524)
Parent | Reportable Legal Entities
Revenues:
Equipment rentals		0	0	0	0
Service and other revenues		0	0	0	0
Total revenues		0	0	0	0
Cost of revenues:
Cost of equipment rentals, excluding depreciation		0	0	0	0
Depreciation of rental equipment		0	0	0	0
Cost of service and other revenues		0	0	0	0
Total cost of revenues		0	0	0	0
Gross profit		0	0	0	0
Selling, general and administrative expenses		28	42	33	84
Merger related costs		0	0	0	0
Restructuring charge		0	0	0	0
Non-rental depreciation and amortization		3	3	11	11
Operating (loss) income		(31)	(45)	(44)	(95)
Interest (income) expense, net		(11)	(5)	(26)	(10)
Other (income) expense, net		(172)	(144)	(469)	(387)
Income before provision for income taxes		152	104	451	302
Provision for income taxes		45	39	105	102
Income (loss) before equity in net earnings (loss) of subsidiaries		107	65	346	200
Equity in net earnings (loss) of subsidiaries		226	134	440	249
Net income		333	199	786	449
Other comprehensive (loss) income		18	42	(27)	75
Comprehensive income (loss)		351	241	759	524
URNA | Reportable Legal Entities
Revenues:
Equipment rentals		1,715	1,407	4,568	3,739
Service and other revenues		32	27	92	75
Total revenues		1,943	1,606	5,276	4,314
Cost of revenues:
Cost of equipment rentals, excluding depreciation		614	502	1,710	1,397
Depreciation of rental equipment		316	266	911	738
Cost of service and other revenues		16	12	49	37
Total cost of revenues		1,076	896	3,074	2,508
Gross profit		867	710	2,202	1,806
Selling, general and administrative expenses		197	167	604	483
Merger related costs		11	16	14	32
Restructuring charge		8	8	14	27
Non-rental depreciation and amortization		65	54	185	162
Operating (loss) income		586	465	1,385	1,102
Interest (income) expense, net		122	133	349	341
Other (income) expense, net		196	154	529	419
Income before provision for income taxes		268	178	507	342
Provision for income taxes		71	73	135	140
Income (loss) before equity in net earnings (loss) of subsidiaries		197	105	372	202
Equity in net earnings (loss) of subsidiaries		29	29	68	47
Net income		226	134	440	249
Other comprehensive (loss) income		18	42	(27)	75
Comprehensive income (loss)		244	176	413	324
Guarantor Subsidiaries | Reportable Legal Entities
Revenues:
Equipment rentals		0	0	0	0
Service and other revenues		0	0	0	0
Total revenues		0	0	0	0
Cost of revenues:
Cost of equipment rentals, excluding depreciation		0	0	0	0
Depreciation of rental equipment		0	0	0	0
Cost of service and other revenues		0	0	0	0
Total cost of revenues		0	0	0	0
Gross profit		0	0	0	0
Selling, general and administrative expenses		0	0	0	0
Merger related costs		0	0	0	0
Restructuring charge		0	0	0	0
Non-rental depreciation and amortization		0	0	0	0
Operating (loss) income		0	0	0	0
Interest (income) expense, net		(1)	1	0	2
Other (income) expense, net		0	0	0	0
Income before provision for income taxes		1	(1)	0	(2)
Provision for income taxes		0	0	0	0
Income (loss) before equity in net earnings (loss) of subsidiaries		1	(1)	0	(2)
Equity in net earnings (loss) of subsidiaries		17	19	30	21
Net income		18	18	30	19
Other comprehensive (loss) income		18	41	(28)	75
Comprehensive income (loss)		36	59	2	94
Non-Guarantor Subsidiaries - Foreign | Reportable Legal Entities
Revenues:
Equipment rentals		146	129	383	330
Service and other revenues		5	3	14	11
Total revenues		173	160	465	405
Cost of revenues:
Cost of equipment rentals, excluding depreciation		57	55	173	159
Depreciation of rental equipment		27	24	77	66
Cost of service and other revenues		4	2	9	5
Total cost of revenues		102	97	301	269
Gross profit		71	63	164	136
Selling, general and administrative expenses		24	19	66	57
Merger related costs		0	0	0	0
Restructuring charge		1	1	1	1
Non-rental depreciation and amortization		7	6	17	16
Operating (loss) income		39	37	80	62
Interest (income) expense, net		1	1	0	1
Other (income) expense, net		13	10	37	33
Income before provision for income taxes		25	26	43	28
Provision for income taxes		8	7	13	7
Income (loss) before equity in net earnings (loss) of subsidiaries		17	19	30	21
Equity in net earnings (loss) of subsidiaries		0	0	0	0
Net income		17	19	30	21
Other comprehensive (loss) income		18	33	(95)	61
Comprehensive income (loss)		35	52	(65)	82
Non-Guarantor Subsidiaries - Domestic | Reportable Legal Entities
Revenues:
Equipment rentals		0	0	0	0
Service and other revenues		0	0	0	0
Total revenues		0	0	0	0
Cost of revenues:
Cost of equipment rentals, excluding depreciation		0	0	0	0
Depreciation of rental equipment		0	0	0	0
Cost of service and other revenues		0	0	0	0
Total cost of revenues		0	0	0	0
Gross profit		0	0	0	0
Selling, general and administrative expenses		16	9	33	24
Merger related costs		0	0	0	0
Restructuring charge		0	0	0	0
Non-rental depreciation and amortization		0	0	0	0
Operating (loss) income		(16)	(9)	(33)	(24)
Interest (income) expense, net		7	3	17	8
Other (income) expense, net		(37)	(25)	(99)	(70)
Income before provision for income taxes		14	13	49	38
Provision for income taxes		3	4	12	14
Income (loss) before equity in net earnings (loss) of subsidiaries		11	9	37	24
Equity in net earnings (loss) of subsidiaries		0	0	0	0
Net income		11	9	37	24
Other comprehensive (loss) income		0	0	0	0
Comprehensive income (loss)		11	9	37	24
Rental equipment
Revenues:
Sales revenue		140	139	478	378
Cost of revenues:
Cost of goods sold		83	84	282	225
Rental equipment | Eliminations
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Rental equipment | Parent | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Rental equipment | URNA | Reportable Legal Entities
Revenues:
Sales revenue		128	118	435	334
Cost of revenues:
Cost of goods sold		76	73	259	202
Rental equipment | Guarantor Subsidiaries | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Rental equipment | Non-Guarantor Subsidiaries - Foreign | Reportable Legal Entities
Revenues:
Sales revenue		12	21	43	44
Cost of revenues:
Cost of goods sold		7	11	23	23
Rental equipment | Non-Guarantor Subsidiaries - Domestic | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
New equipment
Revenues:
Sales revenue		54	40	140	126
Cost of revenues:
Cost of goods sold		46	34	121	108
New equipment | Eliminations
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
New equipment | Parent | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
New equipment | URNA | Reportable Legal Entities
Revenues:
Sales revenue		46	36	123	113
Cost of revenues:
Cost of goods sold		40	31	107	97
New equipment | Guarantor Subsidiaries | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
New equipment | Non-Guarantor Subsidiaries - Foreign | Reportable Legal Entities
Revenues:
Sales revenue		8	4	17	13
Cost of revenues:
Cost of goods sold		6	3	14	11
New equipment | Non-Guarantor Subsidiaries - Domestic | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Contractor supplies
Revenues:
Sales revenue		24	21	66	60
Cost of revenues:
Cost of goods sold		15	14	43	42
Contractor supplies | Eliminations
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Contractor supplies | Parent | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Contractor supplies | URNA | Reportable Legal Entities
Revenues:
Sales revenue		22	18	58	53
Cost of revenues:
Cost of goods sold		14	12	38	37
Contractor supplies | Guarantor Subsidiaries | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		0	0	0	0
Contractor supplies | Non-Guarantor Subsidiaries - Foreign | Reportable Legal Entities
Revenues:
Sales revenue		2	3	8	7
Cost of revenues:
Cost of goods sold		1	2	5	5
Contractor supplies | Non-Guarantor Subsidiaries - Domestic | Reportable Legal Entities
Revenues:
Sales revenue		0	0	0	0
Cost of revenues:
Cost of goods sold		$ 0	$ 0	$ 0	$ 0

[1] There were no material reclassifications from accumulated other comprehensive loss reflected in other comprehensive income (loss) during 2018 or 2017. There is no tax impact related to the foreign currency translation adjustments, as the earnings are considered permanently reinvested. There were no material taxes associated with other comprehensive income (loss) during 2018 or 2017.

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Condensed Consolidating Financial Information of Guarantor Subsidiaries - CONDENSED CONSOLIDATING CASH FLOW INFORMATION (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	$ 2,123	$ 1,756
Net cash used in investing activities	(2,393)	(2,242)
Net cash (used in) provided by financing activities	(7)	477
Effect of foreign exchange rates	(10)	21
Net (decrease) increase in cash and cash equivalents	(287)	12
Cash and cash equivalents at beginning of period	352	312
Cash and cash equivalents at end of period	65	324
Eliminations
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	0	0
Net cash used in investing activities	0	0
Net cash (used in) provided by financing activities	0	0
Effect of foreign exchange rates	0	0
Net (decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	0	0
Cash and cash equivalents at end of period	0	0
Parent | Reportable Legal Entities
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	22	15
Net cash used in investing activities	(22)	(15)
Net cash (used in) provided by financing activities	0	0
Effect of foreign exchange rates	0	0
Net (decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	0	0
Cash and cash equivalents at end of period	0	0
URNA | Reportable Legal Entities
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	2,354	1,839
Net cash used in investing activities	(2,259)	(2,135)
Net cash (used in) provided by financing activities	(101)	298
Effect of foreign exchange rates	0	0
Net (decrease) increase in cash and cash equivalents	(6)	2
Cash and cash equivalents at beginning of period	23	21
Cash and cash equivalents at end of period	17	23
Guarantor Subsidiaries | Reportable Legal Entities
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	(1)	(2)
Net cash used in investing activities	0	0
Net cash (used in) provided by financing activities	1	2
Effect of foreign exchange rates	0	0
Net (decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	0	0
Cash and cash equivalents at end of period	0	0
Non-Guarantor Subsidiaries - Foreign | Reportable Legal Entities
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	(50)	83
Net cash used in investing activities	(112)	(92)
Net cash (used in) provided by financing activities	(109)	(2)
Effect of foreign exchange rates	(10)	21
Net (decrease) increase in cash and cash equivalents	(281)	10
Cash and cash equivalents at beginning of period	329	291
Cash and cash equivalents at end of period	48	301
Non-Guarantor Subsidiaries - Domestic | Reportable Legal Entities
Condensed Cash Flow Statements, Captions [Line Items]
Net cash provided by (used in) operating activities	(202)	(179)
Net cash used in investing activities	0	0
Net cash (used in) provided by financing activities	202	179
Effect of foreign exchange rates	0	0
Net (decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	0	0
Cash and cash equivalents at end of period	$ 0	$ 0

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Subsequent Event (Details) customer in Thousands, $ in Millions	3 Months Ended	4 Months Ended
	Dec. 31, 2018 USD ($)	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($) employee location state customer
BlueLine Rental LLC
Subsequent Event [Line Items]
Number of customers (over) | customer			50
Number of rental locations (branch) | location			114
Number of employees | employee			1,700
Number of states | state			25
Scenario, Forecast | BlueLine Rental LLC
Subsequent Event [Line Items]
Aggregate consideration paid	$ 2,100
Revenues		$ 786
Term Loan
Subsequent Event [Line Items]
Maximum borrowing capacity			$ 1,000