Hello, everyone. Thank you for joining us, and welcome to RB Global Third Quarter 2026 Earnings Call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question at that time, please press star one on your telephone keypad to raise your hand. I would now like to hand the conference over to Sameer Rathod, Vice President of Investor Relations and Market Intelligence. Please go ahead.
Hello, and good morning. Thank you for joining us today to discuss our third quarter 2026 results. Joining me on the call are Jim Kessler, our Chief Executive Officer, and our newly appointed Chief Financial Officer, Steve Steinberg. The following discussion will include forward-looking statements, including projections of future earnings, business, and market trends. These statements are subject to risk and uncertainties that could cause actual results to differ materially, and should be considered in conjunction with the cautionary statements contained in our earnings release and periodic SEC reports. We will also discuss certain non-GAAP financial measures. For the identification of these measures and the most directly comparable GAAP financial measures and the applicable reconciliation, please see our earnings release and SEC filings. At this time, I would like to turn the call over to our CEO, Jim Kessler. Jim?
Thanks, Sameer, and good morning to everyone joining us today. We continue to execute against our priorities, grow in transaction volumes, drive in operating leverage, and invest into position the business for long-term growth. That focus drove broad-based strength across all sectors, with total GTV increasing 20%, service revenue increasing 10%, and adjusted EBITDA increasing 13%. When we talk about investing in the long term, One Marketplace is a great example. What began as behind-the-scenes work to connect our platforms, inventory, and capabilities is now coming to light for our customers. Late last month, we introduced Buy Now and Make Offer options on rbauction.com, bringing listings to the platform and expanding the ways customers can buy and sell equipment. While we have historically offered these capabilities through IronPlanet, bringing them together on a new rbauction.com technology stack represents a major milestone in realizing our One Marketplace vision.
Customers can now access auctions, fixed price, and negotiated transactions in one place, giving sellers greater flexibility in how they transact and buyers broader access to inventory and additional ways to purchase the equipment they need when they need it. Importantly, our opportunity extends well beyond the traditional auction channel. Our global remarketing solutions are designed to support the entire asset disposition process. One Marketplace creates the ability to engage with sellers earlier, match inventory with the most appropriate sales channel, and connect assets with a broader pool of buyers. By bringing together more inventory, buyers, and transactions options, we aim to deepen marketplace liquidity, deliver better outcomes for our customers, and capture a greater share of their remarketing needs. That's what One Marketplace is about. Before I turn it to Steve, I want to spend a moment on the leadership appointments and organizational changes we announced this quarter.
RB Global has expanded well beyond any single brand or sector. Today, we operate in more sectors, participate across more of an asset's life cycle, and reach more customers through more channels and more geographies around the world than ever before. We have tremendous talent across the organization, and as we enter our next stage of growth, we reshaped our leadership team and organizational structure with one clear objective: greater clarity and focus. The new structure places proven leaders with deep expertise in new roles with clear ownership and direct accountability per results. We believe this alignment will enable faster decisions and sharper execution, translating directly to the P&L, growing service revenue and expanding margins. In particular, I want to highlight Steve Steinberg, who was promoted to Chief Financial Officer. Steve has been with RB Global for over a decade, serving in leadership roles across finance, strategy, and operations.
I am confident that his deep knowledge of our business and financial acumen will be instrumental in supporting strong execution, margin expansion, balance sheet flexibility, and value-creating capital allocation. With that, I'll turn the call over to Steve.
Thank you, Jim, and good morning to everyone. Total GTV increased 20% year-over-year to $4.7 billion, or approximately 14% organically, with strength across all sectors. Automotive GTV grew 18% in the quarter, driven by higher unit volumes and higher average selling prices. Unit volume growth was driven by continued net market share gains in salvage, along with growth in U.S. remarketed vehicle volume supported by the GSA contract. U.S. remarketed vehicles now represent approximately 24% of our total automotive unit volume. We estimate that broader salvage industry volumes remain somewhat stable, with CCC Intelligent Solutions estimating that total loss frequency was roughly flat year-over-year at 22.8% in the third quarter. Despite the current volume environment, we continue to see constructive underlying indicators.
The spread between vehicle repair cost inflation and used vehicle inflation remains supportive of an expanding total loss frequency, while improving insurance affordability trends could provide an additional tailwind over time. GTV growth in automotive was also supported by a higher average price per vehicle sold, up about 8%, reflecting strength in both salvage and remarketed vehicles. Heavy equipment and transportation GTV increased 19% year-over-year and 9% organically. Organic growth was led by our North American regions and international, particularly in the unreserved auction channel. We delivered this growth even as some enterprise customers cycled over large prior year fleet realignment, retained fleet longer due to stronger activity in their end markets, and continued to navigate the global geopolitical landscape. Next, service revenue increased 10% in the quarter, driven by higher GTV, partially offset by a lower service revenue take rate.
The service revenue take rate declined 186 basis points year-over-year to 19.8%. As we have discussed, we manage the business to maximize service revenue dollars and long-term profitability, rather than a particular take rate percentage, as they will move with the volume mix we choose to bring into our marketplace. Given the mix of factors affecting service revenue take rate, we want to provide greater transparency into the year-over-year change. Importantly, most of the decline, or 130 basis points, reflects strategic choices to expand our portfolio into other attractive asset types in our marketplace. Starting with automotive remarketing, which accounted for approximately 60 basis points of the decline, growth was driven by our GSA contract.
While GSA assets carry lower percentage service revenue take rates because of their higher underlying transaction values, they generate attractive revenue and profit per unit economics, bring incremental volume into our marketplace, and leverage our existing physical assets. Just as importantly, this volume expands our reach into higher condition vehicles for the wear and tear market. We are already seeing early signs of greater crossover within our buyer base, with traditional salvage buyers expanding into higher condition vehicles and historically GSA-focused buyers purchasing salvage. This broadens demand across our inventory and demonstrates the value of bringing more buyers and more asset types together in a single marketplace. Acquisitions and divestitures accounted for approximately 40 basis points of the decline. Businesses we acquire typically enter our portfolio with lower service revenue take rates, reflecting their regional operating models and limited ancillary services.
We see a meaningful opportunity to leverage RB Global's broader marketplace capabilities to enhance the value we deliver to these customers over time. In the fourth quarter, we began harmonizing fees, marking the first step in a multi-year effort to better align our fee structure with the value delivered through the RB Global marketplace. The year-over-year comparison also reflects the divestiture of DDI Technologies in the fourth quarter of 2025, which contributed service revenue without any associated GTV. Finally, real estate accounted for approximately 30 basis points of the decline, reflecting the addition of BigIron to the portfolio. As we discussed previously, real estate transaction levels can vary meaningfully quarter to quarter and carry service revenue take rates in the low single digits.
Beyond these newer areas of portfolio expansion, take rate movement across our core marketplace was more modest, with an approximately 20 basis point decline across our AG&T and other sectors, driven primarily by normal mix variability. The 40 basis point decline in auto salvage take rate reflected approximately 10 basis points from normal customer mix and approximately 30 basis points from commercial choices to add profitable volume and support our marketplace growth. Growing profitable volume is a key part of our strategy to expand our marketplace and attract a broader universe of buyers and sellers. Bringing additional volume into our ecosystem strengthens marketplace liquidity and creates a flywheel effect that we believe will support profitable growth as we expand service attachment and monetize the value of our marketplace.
As we discussed previously, we remain disciplined on pricing, and we continue to attract and retain customers who will strengthen our marketplace and accelerate our flywheel. As always, we will continue to balance take rate against opportunities to grow attractive volumes, with our goal of growing adjusted EBITDA faster than service revenue growth to drive long-term value creation. Looking ahead to the fourth quarter, we expect the service revenue take rate to be broadly consistent with the third quarter. Adjusted EBITDA increased 13% in the third quarter, driven by higher service revenue, increased contribution from inventory returns, and disciplined execution. Adjusted EBITDA growth outpaced service revenue growth of 10%, demonstrating continued operating leverage despite the strategic mix and take rate choices we discussed earlier. This is consistent with the strong profit flow-through we have demonstrated year-to-date and throughout 2025.
Adjusted earnings per share rose 11%, driven by higher operating income and a lower weighted average share count, partially offset by higher net interest expense and a higher adjusted tax rate. Turning to capital allocation, we remain focused on deploying capital where we see the greatest opportunity to create long-term shareholder value. In the third quarter, share repurchases were a compelling use of our capital, and we repurchased and retired approximately 3.9 million shares for $350 million, bringing our year-to-date total to $500 million. At the end of the third quarter, our leverage ratio is now 1.8x adjusted net debt to adjusted EBITDA. Now moving to the outlook. We are raising our 2026 outlook and now expect gross transaction value to grow between 14%-15%, with adjusted EBITDA growth of 9.7% at the midpoint.
This updated outlook reflects our continued marketplace growth, strong operational execution, and continued momentum behind our acquisitions. With that, let's open the call for questions.
We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. Ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Sabahat Khan with RBC Capital Markets. Your line is open. Please go ahead.
Thank you, and good morning. Maybe just wanted to start with the first one at a higher level. If you can perhaps detail what has evolved in the backdrop, just trying to understand sort of the meaningful GTV increase. If you can maybe parse that out across macro, industry-specific, share initiatives, and maybe what the recent election outcome might mean for the legacy equipment business that is a bit more macro-dependent. Thank you.
Yeah. No, look, let me start, and if Steve or Sameer want to add any questions. Look, the real answer to your question is all the above participate in the growth that we have had. The one thing I just want to make sure is, I think as we think about the heavy equipment side, it is more over the long term as we think about that business compared to everything else. But I think when I look at this year so far, market share gains has been a big part of it, adding assets into our marketplace has been a part of it, and the macro side, when I think about ASPs, has been a part of it. So I think there is an all-of-the-above answer to your question, and unless Sameer and Steve have anything to add, I think I hit it.
Great. Then maybe just on sort of the remarketing whole car business, there has been some activity in the sector. I think initially when you took the reins, there was a view to start with the lower price point cars, maybe not get into the. Just maybe if you can update us on what your whole car remarketing strategy is, what we should expect over the next little while. Could this become a bigger part of the mix? I will pass the line. Thank you.
Look, we think the remarketing distressed used car is a segment that fits really well with our buyer base and something that we are really excited about growing well into the future. I think you can see that with the results so far, and we have announced a big contract win probably about a little bit less than a year ago, and you are seeing that come through the P&L at this point. We think our buyer base is very attractive to slightly distressed vehicles.
Thank you.
Your next question comes from the line of John Babcock with Barclays. Your line is open. Please go ahead.
All right. Good morning, and thanks for taking my questions. First one's on liquidity. You obviously already have pretty meaningful volumes on the automotive side, and I was just wondering, how should we think about the incremental benefits from growing that volume over time? Is there a point at which you start to see more diminishing returns from that liquidity? Just was wondering if you can overall quantify and also qualify that.
I'll start, John, and probably more of a macro question that I will pass over to Sameer. But look, the way we look at it is the more assets that we can get into our marketplace, the more that our buyers are willing and the more liquidity for bids that we can present, the better we think increase in ASPs are for our business. So we like having the liquidity. We have a big enough buyer base to match the supply and demand, which we get excited about. But Sameer, anything from a macro environment you would want to add?
Hey, John. Great question. I think from our perspective, more liquidity is always better, so we are on this constant journey to continue to improve liquidity. I don't think there is an end point on too much or some sort of breaking point or threshold. I think it is a constant journey.
Okay. Appreciate that. The next question was with regards to a totally different topic. There was this FinCEN report that came out in mid-October, and I was wondering if you could just talk about the steps that you have taken and plan to continue to take to minimize suspicious transactions in your auctions, and also if you have any other comments around that would be helpful.
Yeah. I will start, and then I will pass it over to Steve if you want to add anything to it. Look, I think like every company that is international, you are constantly always on a journey to make sure you know your customer, you know the buyer base, and you are protecting the company against anything that is suspicious transactions. I am sure this is a journey that we are always going to be on as things evolve and as you close one hole, another hole opens that you have to constantly go after. For us, I am really proud of the team and how we have handled it since we have taken over IAA. I feel really good about all the holes that are out there that we have closed, and we have been good stewards of that. But it is a journey that we are constantly always going to be on.
I don't think it is ever going to end.
Your next question comes from the line of John Healy with Northcoast Research. Your line is open. Please go ahead.
Thanks for taking my question. Jim, I wanted to ask kind of a big picture question. You touched on it a bit with the kind of the leadership changes that you guys made a couple weeks ago. I would love to get your thoughts just about maybe philosophically or just kind of tactically what you were looking for when you made these changes, and how might the group work differently or maybe initiative-wise than maybe the constructs of the company maybe three to six months ago? Thank you.
Great question. I always love theoretical questions as we go through this. For me, and as you get to know me, I am a big clarity and focus type of person, and anything that we change in our organizational structure is to make sure we have complete clarity so we can execute at a high level. I believe when I look out over the next five years, we have such a unique opportunity to grow our top line and expand margin dollars and operate in the most efficient manner. And typically, when you have a lot of layers or a lot of leaders in the organizational structure, there could become a little bit misalignment.
When I look at my team right now, I think we have the right size team, we have the right alignment, but this all gets back to clarity and focus and making sure the organizations can operate at a high level. When I look out to the future, I see a lot of opportunity, and I want to make sure and ensure we can hit that, and that was really the theory behind the change.
Understood. I just wanted to kind of piggyback on the previous question. Again, trying to be respectful for what you can say and not say, but we've gotten a lot of investor questions about the FinCEN-type reports and questions there. Can you answer directly if there's any sort of investigation subject that you guys as a company are of the materials that most of us all read over the last couple weeks? We've just getting this question regarding disclosure and things like that. Thank you.
I think the easiest way for me to answer, I'm sure Steve and Sameer are probably, hopefully he answers this the right way, but I think the easiest way to answer this question is, if we had anything to disclose, we would disclose it. I would just point you to your disclosure. The fact that you don't see anything in there, I think is a very clear answer to that question.
Thank you, guys.
Your next question comes from the line of Steve Hansen with Raymond James. Your line is open. Please go ahead.
Yeah. Good morning, guys. Thanks for the time, and thanks for the additional color on the take rate component today. That is really helpful to illuminate the process, the different pieces. Just a quick question on your integration and harmonization efforts for recent acquisitions like BigIron. Jim, you referenced you are in that process now and starting to layer on some incremental services. Is there a timeline we should think about for the different acquisitions in terms of how long it takes to bring sort of these new parts of your business up to the broader platform standards or the platform run rate metrics? Just trying to get a sense for how you feel about that and the pricing dynamics more broadly. Thanks.
Yeah, Steve, great question, and I will start, and I will pass it over to Steve if he wants to add any color. The first thing when I look at any M&A that we do that is kind of a complement to what we already have is we want to make sure the customer base gets retained. So that is the first thing that we focus on is customer retention, and then we start to focus on, okay, we have a certain historical take rate that we have because of the services that we offer and the value that we bring to each of our customers. What is it going to take that to translate that into the company coming into the portfolio? Then we start to integrate it.
But I think when everything gets fully synergized, I talked about One Marketplace, and as we start bringing those platforms into One Marketplace, that is when it gets fully synergized. So I would always think about this as a couple of stages. The first stage is to make sure the customer base gets retained. The next stage is, okay, how do we add the services and the value? Then the final stage is bringing them into One Marketplace. So I would look at this as a multi-year opportunity as we harmonize the fees, but I just want to make sure I am clear. Our end objective in all this is to harmonize. Unless there is something in the asset class that is completely different, like real estate, where it is just set up completely different in terms of a percentage.
But anything that is heavy equipment, we would want to harmonize it to what our historical take rates because we bring the level of service and value to the new customer base. And with that, Steve, do you have anything you want to add?
Yeah, no, Jim, I think you covered a lot of it. I mean, the only thing I would add on the acquisitions is, Jim had mentioned it is a phased approach. So we do not only look at it from a monetization of the fees and the GTV from a marketplace perspective, but we are also working on integration on the cost side of that business into our global infrastructure. So we are kind of taking it from both ends. And so it does, depending upon the acquisition, the timing can vary a little bit from each one, but we are pretty comfortable with where we are at on all of our acquisitions right now.
Appreciate that, color. Maybe just as a follow-up related note, is just to maybe speak to the acquisition pipeline today and whether you still think there is good opportunity out there. Thanks.
Hey, Steve, it is one of the things I am very excited about. I would just look at, after the IAA acquisition has happened and what we have done as a management team, just as a history of the things that we have an appetite for. As you look at what the future is, and we think we have a lot of opportunity, especially as you think about us as a global company, and there is not a lack, but we do take a lot of due diligence and time to make sure the culture, the marketplace, the right acquisitions happen, and so we can get to the synergies and everything that Steve talked about.
Appreciate that, color.
Your next question comes from the line of Maxim Sytchev with NBCM. Your line is open. Please go ahead.
Hi. Good morning, gentlemen. I just had a quick question on the guarantee contracts velocity. I think they were up 61% this quarter. I was wondering if there was any drag on margins by any chance, and if we should anticipate that level of supply solicitation on a prospective short-term basis. Just maybe any color there would be helpful. Thanks.
Hey, Max. I will start, and I will pass it over to Steve. When I think about anything guaranteed, or reserved auctions, or however we attack the need that the customer has, I really think about this really is dictated by customers and not at our direction. It is really about what is the customer looking for, how do we listen to them, and then how do we provide them something that they are going to see value in. With that, I will pass it over to Steve if he wants to add any color about the monetary side of it.
Yeah, no, thanks, Jim. No, nothing systemic there. We have seen an increase in our inventory guarantee contracts. Again, to Jim's point, that really comes from the customer perspective on liquidity, timing, and risk. I do not think there is anything systemic to it.
Okay. That's great. Thank you. Actually, one quick one for Steve, if I may. I noticed that for BigIron, the customer retention and attrition length of time moved from seven to five years. Is there anything to read into this, or is it just clean up assumptions around the model?
Yeah, no, nothing there. This was just clean up on the purchase accounting, so nothing there to read into that.
Okay. Perfect. Thank you so much. That's it for me.
Your next question comes from the line of Craig Kennison with Baird. Your line is open. Please go ahead.
Hey, good morning. Thanks for taking my question. I wanted to follow up on the One Marketplace strategy, and specifically the harmonization of your take rate that you discussed. As I understand it, your take rates have evolved within each segment to be competitive within each segment. I am curious, is the goal to run this business such that you have a harmonized take rate across the whole portfolio? If that is the case, do not you run the risk that each segment is not optimal any further?
Yeah. Hey, Craig. Sorry if I misstated it. What I was really referring to is more of the J.M. Wood acquisition, the Blackmon acquisition that we did that was kind of the traditional Ritchie Brothers marketplace with construction equipment. Of course, when we get into different asset classes like real estate and agriculture, and depending on what that environment is that we are competing against, we will make it. When I mean harmonize, even with agriculture, we plan to do other things like financial services, transportation, how we add value, the data that we provide to our customers. Different things that create different values, and different attachments that we will do, which will change the take rate from what they historically had into the future.
Anything we say harmonize in the way that you just described, think about it as something that was core inside of the legacy of construction equipment, tractors, trailers, and items like that. Sameer and Steve, anything you want to add? No, I think we are good on that question.
Yeah, thank you. That is, I am sure, on me. Thanks for clarifying nonetheless. I wanted to follow up. Earlier you shared a metric, the total loss rate, which is helpful. At the top of the funnel, one of the issues in that automotive sector has been weakness in just the sheer number of claims, I think caused by higher insurance rates. I am just wondering, have you seen that curve bend at all? We know rates have started to fall, but it may take a while before claims start to pick up.
Yeah. Hey, Craig. I will break it to Sameer just so he can talk about more of the macro environment for you.
Hey, Craig. Yeah, great question. I think the leading indicators have inflected in our favor, right? If you look at the inflation rate in private automotive insurance, that has declined. I do not think we are in a position to comment on if we have seen a statistical pickup in assignments or anything like that. But again, if you look at history, it would suggest that this decline in inflation should translate into insurance becoming more affordable, and then you can kind of logically deduce from there the impact to salvage.
Great. Thank you.
Your last question comes from the line of Connor McClanahan with Stephens. Your line is open. Please go ahead.
Hi, it's Jeff Lick at Stephens. Connor must have registered for me. Guys, I was wondering if just on the lot growth, both automotive only being up 8.4%, I think if people would have looked at some of the other data that's out there and then just the timing of things that we knew, the new customer kind of, or the new agreement with the win that kind of started, kicked in Q2, really wasn't in all Q2, but it was in all Q3. So the 8.4 looked maybe a little light. But on the flip side, I was also hoping you could comment on where in HE&T and other, where those lots, was there a particular segment where that was coming from? Because that was particularly strong.
Sorry. So your first question on the automotive lot volume in terms of 8%, could you just say that again? You were expecting it to be higher? Is that what your question was?
Yeah, I mean, it was a deceleration from the 10.6%. Obviously, there was more of the win running through. You would have expected it to be maybe a little higher. Just curious what the dynamics there are, and then also the HE&T.
Yeah. Okay, got it. I think we're very happy with our unit volume growth in automotive. I think Jim had indicated there will be pluses and minuses throughout the year, but we're comfortable saying that we, on a net basis, have gained share in the third quarter. And then your second question in terms of HE&T lot volume growth, I don't think there was a specific sector or anything like that that had an outsized impact on that business. As you know, that business can be, for lack of a better word, lumpy quarter to quarter, but there wasn't any kind of trend beyond what Steve had mentioned. I think we are still seeing, as Steve mentioned, in the preferred enterprise customers, they're still cycling over some large fleet realignments from last year. Our North America regions business continues to exhibit very strong growth.
I don't know, Steve, if you had anything else to add.
No, I think you covered it, Sameer. I mean, I think you could just think about it regionally. Our North American regions is kind of where a lot of that volume came from in Q3. But I think you covered it, Sameer.
Just a quick follow-up. You guys mentioned the traditional buyers who would buy salvage going up to remarketing and vice versa. Just curious if maybe you could give a little more anecdotal information on who those buyers are or why that type of effect is manifesting.
Yeah, in terms of the buyer profile, I think there's not a dramatic difference. Again, just goes back to kind of the concept of adding more buyers to our platform and then offering them the widest selection of stories. So again, we're early days, obviously, of what we think we can accomplish there, but there's still a lot to go. But I wouldn't say there's a specific buyer profile there.
Awesome. Well, thanks for taking my questions and nice results, and best of luck in Q4.
Your next question comes from the line of Krista Friesen with CIBC. Your line is open. Please go ahead.
Hi. Thanks for taking my question. Just wanted to squeeze one in here on the comments you made there on the enterprise customers. It was mentioned that continued strength in large-scale construction projects contributed to lower equipment disposition. Just wondering what you're hearing from those customers as they look out to 2027, and just if you have any thoughts on how these customers might trend over the next 12 months here. Thank you.
Yeah, I'll start, and then Sameer and Steve, feel free if you want to add anything. I don't think we're going to give any color into 2027 at this point about what customers are thinking. We feel really good about our business as we think about 2027 into the future, but we're not going to comment on any customers' appetite at this point.
Thanks. I can appreciate that. I will jump back in the queue.
We have reached the end of the Q&A session. I will now turn the call back to RB Global CEO, Jim Kessler, for closing remarks.
To close, I want to thank our teams across RB Global for another strong quarter. We continue to evolve RB Global, building on the strength of our platform, expanding our capabilities, and driving operating leverage. We believe that positions us well for continued transactional growth and profitable growth over time. I want to thank everyone for joining us today, and everyone have a great week.
This concludes today's call. Thank you for attending. You may now disconnect.