Heavy equipment distributor Custom Truck One Source (NYSE: CTOS) announced better-than-expected revenue in Q2 CY2026, with sales up 10.2% year on year to $563.4 million. The company’s full-year revenue guidance of $2.15 billion at the midpoint came in 4.6% above analysts’ estimates. Its GAAP profit of $0.05 per share was significantly above analysts’ consensus estimates.
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Custom Truck One Source (CTOS) Q2 CY2026 Highlights:
- Revenue: $563.4 million vs analyst estimates of $517.7 million (10.2% year-on-year growth, 8.8% beat)
- EPS (GAAP): $0.05 vs analyst estimates of $0.01 (significant beat)
- Adjusted EBITDA: $116.8 million vs analyst estimates of $103 million (20.7% margin, 13.3% beat)
- The company lifted its revenue guidance for the full year to $2.15 billion at the midpoint from $2.06 billion, a 4.2% increase
- EBITDA guidance for the full year is $446.3 million at the midpoint, above analyst estimates of $433.8 million
- Operating Margin: 8.3%, up from 5.5% in the same quarter last year
- Free Cash Flow was -$50.31 million, down from $12.35 million in the same quarter last year
- Backlog: $322.5 million at quarter end, down 3.7% year on year
- Market Capitalization: $2.31 billion
Company Overview
Inspired by a family gas station, Custom Truck One Source (NYSE: CTOS) is a distributor of trucks and heavy equipment.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last five years, Custom Truck One Source grew its sales at an exceptional 14.7% compounded annual growth rate. Its growth beat the average industrials company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Custom Truck One Source’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 6.6% over the last two years was well below its five-year trend. 
This quarter, Custom Truck One Source reported year-on-year revenue growth of 10.2%, and its $563.4 million of revenue exceeded Wall Street’s estimates by 8.8%.
Looking ahead, sell-side analysts expect revenue to grow 3.1% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and suggests its products and services will see some demand headwinds.
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Operating Margin
Custom Truck One Source was profitable over the last five years but held back by its large cost base. Its average operating margin of 6.8% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point.
On the plus side, Custom Truck One Source’s operating margin rose by 5.7 percentage points over the last five years, as its sales growth gave it immense operating leverage.
In Q2, Custom Truck One Source generated an operating margin profit margin of 8.3%, up 2.8 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
Custom Truck One Source’s full-year EPS flipped from negative to positive over the last five years. This is a good sign and shows it’s at an inflection point.
Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
For Custom Truck One Source, its two-year annual EPS growth of 92.4% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.
In Q2, Custom Truck One Source reported EPS of $0.05, up from negative $0.13 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Custom Truck One Source’s full-year EPS to grow 93.9% from $0.10 to $0.19.
Key Takeaways from Custom Truck One Source’s Q2 Results
It was good to see Custom Truck One Source beat analysts’ EPS expectations this quarter. We were also excited its EBITDA outperformed Wall Street’s estimates by a wide margin. Zooming out, we think this was a good print with some key areas of upside. The stock traded up 10% to $11.69 immediately after reporting.
Indeed, Custom Truck One Source had a rock-solid quarterly earnings result, but is this stock a good investment here? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).
