U-Haul FY2026 Earnings Collapse as Fleet Depreciation and Disposal Losses Overwhelm

What happened

For the fiscal year ended March 31, 2026, U-Haul reported net earnings of just $83.1 million, a catastrophic 77% drop from the $367.1 million earned in the prior year, driven by the same fleet-related headwinds that have plagued recent quarters. The fourth quarter alone produced a net loss of ($127.8) million, extending the pattern of quarterly losses as the company continues to work through an over-fleeted position. Management had previously signaled that depreciation and poor resale values would "bottom out this calendar year," but these results suggest the bottom is not yet in. The company's moving and storage segment earnings were severely compressed by elevated depreciation and losses on equipment sales, while self-storage occupancy declined further to 87.2%, limiting the offset from that growing business. Despite the weak earnings, the company retains $1.48 billion in liquidity to fund operations through this extended normalization period.

Implication

Investors should brace for continued volatility as U-Haul's fleet hangover persists; the FY2026 results confirm that the depreciation and disposal losses remain at crushing levels, with the Q4 net loss of ($127.8)M indicating that management's 'bottoming' call for CY2026 is at risk. The key near-term catalyst is the next quarterly report (FQ1 FY2027) which should show whether the lower-cost MY2026 fleet is beginning to reduce depreciation run-rate, and whether disposal losses moderate from the $74.6M YoY drag seen in FQ3. If sequential improvement is not evident by Q1, the thesis of a 6-12 month normalization timeline fails, and the stock may drift toward the $38 bear case. On the positive side, the company's storage expansion pipeline (~12.9M NRSF coming) and strong liquidity provide a cushion, but patience is required. The current 'WAIT' rating remains appropriate; an attractive entry point near $45 would offer a better risk/reward, but investors should not add unless hard evidence of fleet economics improvement appears.

Thesis delta

The FY2026 results significantly weaken the thesis that fleet normalization was imminent. While the base case still hinges on lower MY2026 vehicle costs and eventual depreciation relief, the magnitude of the earnings collapse and the Q4 loss suggest that the timing of the inflection may slip beyond the original 6-12 month window. The probability of the bear case ($38) increases from 30% to nearer 40%, as forced disposal and weak transaction growth may persist longer than anticipated.