Fleet costs still swamp the U-Haul moat
- U-Haul is the best-known DIY moving brand in North America, with a huge dealer and store network.
- Fiscal 2026 Moving and Storage revenue rose to $5.69 billion, but segment operating earnings fell 46%.
- The main damage came from higher fleet depreciation and losses on retired rental equipment.
- Management plans to cut rental truck capital spending by about $560 million in fiscal 2027.
- Self-storage is still a growth idea, but owned storage occupancy ended fiscal 2026 at 71.0%.
A repair plan, not a repair yet
U-Haul still owns a valuable position. When people move themselves, the orange U-Haul brand is often the first name they know. The network of dealers, company stores, trucks, trailers, and storage sites is hard to copy.
The problem is profit. In fiscal 2026, Moving and Storage revenue grew to $5.69 billion from $5.49 billion. Yet operating earnings in that segment dropped to $350.2 million from $645.8 million. The company made more revenue but kept far less of it.
The bear case is simple: the truck fleet has become too expensive. Rental fleet depreciation rose by $186.6 million in fiscal 2026, and losses from selling retired rental equipment rose by $117.6 million. Q4 was ugly too, with a $128 million net loss.
The bull case is now real, but it is still speculative. Management said rental truck capital expenditures, meaning spending on trucks, should fall by about $560 million in fiscal 2027. If that cut truly lowers future depreciation and used-equipment losses, earnings could recover. The $350 million share buyback also shows management thinks the stock is cheap, but it must be funded while profits are weak.
Trucks feed storage and services
U-Haul makes most of its money by renting moving trucks and trailers. It also rents self-storage rooms and portable U-Box units, sells boxes and towing gear, and sells protection plans tied to moving and storage.
The model works best when trucks earn good rental revenue, hold their resale value, and can be sold at a fair price after retirement. That loop broke in fiscal 2026. Newer trucks cost more, resale values fell, and depreciation became a much heavier charge.
Storage adds a second growth path. U-Haul built and bought more storage space, including about 5.3 million net rentable square feet added in fiscal 2026. But new space creates costs before it fills. Management called this a cost bow wave, and occupancy now has to prove it can recover.
The insurance segments are smaller. They help support the moving ecosystem through protection products and senior-market life and health products. They are useful, but they do not change the main story: Moving and Storage drives the company.
What U-Haul sells
Truck and trailer rentals
This is the core business and the main source of revenue. It is also where the biggest profit pressure now sits because trucks cost more and used-truck resale values are weaker.
Self-storage rooms
U-Haul rents fixed storage units at owned locations. Revenue is growing, but owned storage occupancy ended fiscal 2026 at 71.0%, down from 77.0% a year earlier.
U-Box portable storage
U-Box gives customers a portable moving and storage choice. Management said other revenue grew in fiscal 2026 mainly because of increases in the U-Box program.
Moving supplies and towing products
U-Haul sells boxes, tape, pads, hitches, towing accessories, propane, and related services. These products add revenue around a move, but they are not large enough to offset fleet cost pressure by themselves.
Protection and insurance products
The Property and Casualty segment underwrites parts of Safemove, Safetow, Safemove Plus, Safestor, and Safehaul. The Life Insurance segment sells life, health, Medicare supplement, and annuity products mainly to seniors.
One segment carries the load
Segment mix uses fiscal 2026 reportable segment revenue from the FY2026 Form 10-K, before small eliminations. Moving and Storage is about 94% of reportable segment revenue, so the company is highly concentrated.
What could break the recovery
Truck spending cut does not flow through
High impact · High oddsManagement plans to cut fiscal 2027 rental truck capital spending by about $560 million. That sounds large, but depreciation may not fall right away because trucks already in the fleet still carry high costs. If the cut is delayed or does not lower depreciation, the bull case weakens fast.
Used truck prices stay weak
High impact · High oddsU-Haul lost $104.5 million on disposals of rental equipment in fiscal 2026, compared with gains in the prior year. Lower resale values hurt twice: they create losses when trucks are sold and they raise depreciation while trucks are still owned. This is the clearest pressure point in earnings.
Storage occupancy keeps falling
High impact · Medium oddsOwned storage occupancy ended fiscal 2026 at 71.0%, down from 77.0%. Management also said same-store occupancy fell 540 basis points, or 5.4 percentage points, and blamed most of the drop on a delinquent room cleanup program. If that was not a one-time cleanup, storage demand or tenant quality may be weaker than it looks.
New storage creates a cost bow wave
Medium impact · High oddsU-Haul added about 5.3 million net rentable square feet of storage in fiscal 2026. New buildings cost money before they are full, which can drag on margins. Management says well-located units should fill over time, but the timing matters.
Buybacks compete with debt needs
Medium impact · Medium oddsThe company started a $350 million share repurchase authorization after a sharp earnings drop. At the same time, Moving and Storage had $8.12 billion of debt obligations at March 31, 2026 and forecast fiscal 2027 debt payments of $904.0 million. Buybacks may help if the stock is cheap, but they add pressure if cash flow weakens.
In one breath
Why did U-Haul profit fall so much in fiscal 2026?
The main hit came from the truck fleet. Rental fleet depreciation rose by $186.6 million, and losses from selling retired rental equipment rose by $117.6 million.
What is the main bull case for U-Haul stock?
The bull case depends on management cutting rental truck capital spending by about $560 million in fiscal 2027. If that lowers future depreciation and disposal losses, earnings could recover from a very weak base.
Is U-Haul mainly a storage company now?
No. Storage matters and is growing, but Moving and Storage as a whole is still about 94% of reportable segment revenue. Truck and trailer rentals remain central to the business.
What should investors watch next?
Watch fiscal 2027 truck capital spending, rental fleet depreciation, and losses on used equipment sales. Also watch whether self-storage occupancy stabilizes after the delinquent room cleanup.