Financial Data and Key Metrics Changes - The company reported net new orders of 7,083 homes in Q2, down 7% year-over-year, reflecting a 13% decrease in overall absorption pace, partially offset by a 6% increase in average community count to 994 [13][14] - Home sale revenues for Q2 were $4.3 billion, down 4% from $4.4 billion in the prior year, driven by a 6% decrease in deliveries to 7,639 homes, although average sales price increased by 2% to $559,000 [15][16] - Gross margin for Q2 was reported at 27%, at the top end of guidance, influenced by a favorable mix of homes closed and higher incentives, which were 8.7% of gross sales price, up from 6.3% last year [19][20] Business Line Data and Key Metrics Changes - Closings in Q2 were 38% first-time buyers, 42% move-up buyers, and 20% active adult buyers, compared to 40%, 37%, and 23% respectively in the prior year [16] - The active adult business saw a 9% increase in orders, benefiting from new community openings, while first-time and move-up buyers were down 14% and 9% respectively [14][15] Market Data and Key Metrics Changes - Florida operations showed strength with net new orders increasing by 2% year-over-year, despite challenges in other regions like Texas and the West [6][28] - The company experienced varying demand conditions across markets, with positive demand in the Midwest and Southeast, while facing challenges in Dallas, Boston, and California [29][30] Company Strategy and Development Direction - The company is focusing on a diversified operating model to sustain performance amid challenging market conditions, particularly emphasizing its position in the active adult segment [5][6] - The strategy includes slowing land spend and reducing starts to align inventory with current sales rates, while maintaining a disciplined approach to pricing and incentives [11][19] Management's Comments on Operating Environment and Future Outlook - Management noted that consumer confidence remains uncertain, with buyers expressing concerns about affordability and economic conditions, impacting demand [9][10] - The company anticipates closing between 29,000 homes for the full year, refining its guidance based on backlog and absorption pace [18][19] Other Important Information - The company invested $1.3 billion in land acquisition and development in Q2, maintaining a strong land pipeline with approximately 250,000 lots under control [24][25] - The company continues to expect cash flow generation for 2025 to be approximately $1.4 billion, with a strong balance sheet reflected in a cash position of $1.3 billion and a debt-to-capital ratio of 11.4% [26][27] Q&A Session Summary Question: Did the improvement in demand seen in June carry into July? - Management observed positive consumer response in late June when rates dropped, but July showed mixed demand with both strong and weak days [36] Question: How did stick and brick costs trend in the quarter? - Stick and brick costs remained stable at $79 per square foot, consistent with the previous year [38] Question: Can you elaborate on the land options strategy? - The company prefers working with underlying land sellers for better price execution and risk mitigation, while also utilizing land bankers to increase optionality [42][44] Question: How does the company view the impact of potential Canadian tariffs on lumber? - Currently, 20% to 25% of lumber is sourced from Canada, and while tariffs could increase costs, the overall impact is not expected to be catastrophic [51][52] Question: What is the outlook for gross margins in the back half of the year? - Management reiterated guidance for gross margins in Q3 and Q4, citing a balance of higher incentives and lower tariff impacts [60][62] Question: How does the company plan to grow market share as demand strengthens? - The company is focused on leveraging its strong land pipeline and high-quality homes to capture market share, with a goal of long-term growth of 5% to 10% [71][72]

Over the last four quarters, the company has surpassed consensus EPS estimates four times. PulteGroup (PHM) came out with quarterly earnings of $3.03 per share, beating the Zacks Consensus Estimate of $2.92 per share. This compares to earnings of $3.58 per share a year ago. These figures are adjusted for non- recurring items. This quarterly report represents an earnings surprise of +3.77%. A quarter ago, it was expected that this homebuilder would post earnings of $2.47 per share when it actually produced e ...

Q2 2025 Operating & Financial Results July 22, 2025 Forward-looking statements This presentation includes "forward-looking statements." These statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or implied by, these statements. You can identify these statements by the fact that they do not relate to ma ...

```markdown [Financial and Operational Highlights](index=1&type=section&id=Financial%20and%20Operational%20Highlights) PulteGroup reported second-quarter 2025 net income of $608 million, or $3.03 per diluted share, a decrease from $809 million, or $3.83 per share, in the prior year, navigating a competitive market by aligning production with demand, achieving a gross margin of 27.0%, and returning $300 million to shareholders via share repurchases, while maintaining a strong financial position with a debt-to-capital ratio of 11.4% and a cash balance of $1.3 billion despite a 4% decrease in home sale revenues to $4.3 billion and a 6% drop in closings Q2 2025 Key Financial Metrics vs. Q2 2024 | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $608 million | $809 million | -24.8% | | Diluted EPS | $3.03 | $3.83 | -20.9% | | Home Sale Revenues | $4.3 billion | $4.4 billion | -4% | | Closings (units) | 7,639 | 8,097 | -6% | | Home Sale Gross Margin | 27.0% | 29.9% | -290 bps | | Net New Orders (units) | 7,083 | 7,649 | -7% | - CEO Ryan Marshall noted that despite challenges from high interest rates and economic concerns, the company saw a positive consumer response to interest rate pullbacks and has aligned its production and land investment to serve current demand while positioning for future growth[4](index=4&type=chunk)[5](index=5&type=chunk) - The company continued its capital return program, repurchasing **3.0 million common shares** for **$300 million** in the second quarter, with year-to-date spending of **$600 million** on repurchasing **5.8 million shares**[3](index=3&type=chunk)[10](index=10&type=chunk) - PulteGroup ended the quarter with a strong balance sheet, featuring **$1.3 billion in cash** and a debt-to-capital ratio lowered to **11.4%**[6](index=6&type=chunk)[10](index=10&type=chunk) [Consolidated Financial Statements](index=4&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements detail the company's performance, financial position, and cash flows, with total revenues of $8.30 billion and net income of $1.13 billion for the six months ended June 30, 2025, total assets of $17.59 billion supported by $12.57 billion in shareholders' equity, and $421.7 million in cash generated from operating activities, while significant cash was used for share repurchases [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) For the second quarter of 2025, total revenues decreased to $4.40 billion from $4.60 billion year-over-year, primarily due to a 4% decline in home sale revenues, consequently, net income fell to $608.5 million from $809.1 million in Q2 2024, resulting in diluted EPS of $3.03 compared to $3.83, with the prior year's results including a notable pre-tax insurance benefit and a tax benefit Consolidated Statements of Operations Highlights ($000's) | Account | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $4,403,755 | $4,599,655 | $8,296,406 | $8,548,815 | | Income before income taxes | $807,156 | $1,048,312 | $1,488,294 | $1,916,955 | | Net income | $608,483 | $809,133 | $1,131,282 | $1,472,109 | | Diluted earnings per share | $3.03 | $3.83 | $5.60 | $6.93 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, PulteGroup's total assets were $17.59 billion, a slight increase from $17.36 billion at the end of 2024, with the company's cash position decreasing to $1.27 billion from $1.65 billion, while house and land inventory grew to $13.22 billion, and shareholders' equity increased to $12.57 billion, reflecting retained earnings Condensed Consolidated Balance Sheet Highlights ($000's) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total cash, cash equivalents, and restricted cash | $1,267,326 | $1,653,680 | | House and land inventory | $13,216,008 | $12,692,820 | | Total Assets | $17,587,811 | $17,363,763 | | Notes payable | $1,623,065 | $1,618,586 | | Total Liabilities | $5,012,869 | $5,241,799 | | Total Shareholders' equity | $12,574,942 | $12,121,964 | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the first six months of 2025, net cash from operating activities was $421.7 million, a decrease from $657.3 million in the same period of 2024, mainly due to a larger increase in inventory, with the company using $768.9 million in financing activities, dominated by $600 million in share repurchases, resulting in a net decrease in cash of $386.4 million for the period Consolidated Cash Flow Highlights - Six Months Ended June 30 ($000's) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $421,733 | $657,264 | | Net cash used in investing activities | ($39,182) | ($66,201) | | Net cash used in financing activities | ($768,905) | ($994,274) | | **Net decrease in cash** | **($386,354)** | **($403,211)** | - Key uses of cash in financing activities for the first six months of 2025 included **$600 million for share repurchases** and **$90.1 million for dividend payments**[23](index=23&type=chunk) [Segment Data](index=7&type=section&id=Segment%20Data) The company's operations are divided into Homebuilding and Financial Services, with the Homebuilding segment's pre-tax income declining to $764.4 million in Q2 2025, and the Financial Services segment also seeing a decrease in pre-tax income to $42.8 million, impacted by lower closing volumes, while Homebuilding operations experienced a drop in closings and new orders across most regions [Homebuilding Operations](index=7&type=section&id=Homebuilding%20Operations) The Homebuilding segment's income before taxes for Q2 2025 was $764.4 million, down from $984.9 million in Q2 2024, with closings decreasing by 6% to 7,639 units, while net new orders fell 7% to 7,083 units, and the average selling price saw a slight increase to $559,000, with the quarter-end unit backlog standing at 10,779 homes valued at $6.8 billion, compared to 12,982 homes valued at $8.1 billion a year ago Q2 2025 Homebuilding Closings by Region (Units) | Region | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Northeast | 451 | 378 | +19.3% | | Southeast | 1,402 | 1,499 | -6.5% | | Florida | 1,882 | 2,150 | -12.5% | | Midwest | 1,272 | 1,196 | +6.4% | | Texas | 1,218 | 1,472 | -17.3% | | West | 1,414 | 1,402 | +0.9% | | **Total** | **7,639** | **8,097** | **-5.7%** | Q2 2025 Net New Orders by Region (Units) | Region | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Northeast | 384 | 400 | -4.0% | | Southeast | 1,405 | 1,396 | +0.6% | | Florida | 1,773 | 1,746 | +1.5% | | Midwest | 1,272 | 1,265 | +0.6% | | Texas | 1,042 | 1,275 | -18.3% | | West | 1,207 | 1,567 | -23.0% | | **Total** | **7,083** | **7,649** | **-7.4%** | - The unit backlog at the end of Q2 2025 was **10,779 homes** with a value of **$6.8 billion**, down from 12,982 homes valued at $8.1 billion a year ago[9](index=9&type=chunk)[28](index=28&type=chunk) [Financial Services Operations](index=7&type=section&id=Financial%20Services%20Operations) The Financial Services segment reported pre-tax income of $42.8 million for Q2 2025, a decrease from $63.4 million in the prior-year quarter, primarily due to lower home closing volumes, with the mortgage capture rate remaining strong at 84.8%, slightly down from 86.5% in Q2 2024, and origination principal largely flat year-over-year - Pre-tax income for the Financial Services segment was **$42.8 million** in Q2 2025, compared to $63.4 million in Q2 2024[9](index=9&type=chunk)[25](index=25&type=chunk) Q2 Mortgage Originations | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Origination Volume (loans) | 4,984 | 5,105 | | Origination Principal | $2,164,755,000 | $2,140,103,000 | | Capture Rate | 84.8% | 86.5% | [Supplemental Information and Non-GAAP Reconciliation](index=9&type=section&id=Supplemental%20Information%20and%20Non-GAAP%20Reconciliation) This section provides supplemental data on interest capitalization and a reconciliation of non-GAAP measures, with the company's debt-to-capital ratio improving to 11.4% at the end of Q2 2025, and the net debt-to-capital ratio standing at 2.8%, reflecting the company's low leverage [Supplemental Data (Interest)](index=9&type=section&id=Supplemental%20Data%20(Interest)) In the second quarter of 2025, PulteGroup capitalized $26.1 million of interest and expensed $29.0 million, with the total interest in inventory at the end of the period being $136.6 million, a decrease from $149.4 million at the same time last year Interest Incurred and Expensed ($000's) | Description | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Interest capitalized | $26,129 | $29,284 | | Interest expensed | ($29,046) | ($28,023) | [Reconciliation of Non-GAAP Financial Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) PulteGroup's debt-to-capital ratio improved to 11.4% as of June 30, 2025, down from 11.8% at the end of 2024, with the net debt-to-capital ratio at 2.8%, calculated by subtracting total cash from notes payable, which compares to a net cash position (negative 0.3% ratio) at year-end 2024, indicating a slight increase in net leverage but still a very strong balance sheet Debt-to-Capital Ratios Reconciliation ($000's) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Notes payable | $1,623,065 | $1,618,586 | | Shareholders' equity | $12,574,942 | $12,121,964 | | **Debt-to-capital ratio** | **11.4%** | **11.8%** | | Total net debt | $355,739 | ($35,094) | | **Net debt-to-capital ratio** | **2.8%** | **(0.3)%** | ```

Group 1 - PulteGroup is expected to report fiscal Q2 earnings on July 22, 2025, with anticipated earnings of $3.01 per share and revenue of $4.42 billion, reflecting a 16% drop in adjusted earnings and a 4% decline in revenue compared to the previous year [2] - The company's unit backlog decreased by 16% year-over-year in Q1, with a 12% decline in backlog value, indicating potential challenges for future revenue [3] - PulteGroup has a market capitalization of $23 billion, with revenue of $18 billion over the past twelve months, operating profits of $3.8 billion, and net income of $2.9 billion [3] Group 2 - Historical data shows that PulteGroup's stock has increased following earnings reports 70% of the time, with a median one-day gain of 4.4% and a peak increase of 9% [2][6] - In the last five years, there have been 20 earnings data points, with 14 positive and 6 negative one-day returns, resulting in a 70% occurrence of positive returns [6] - The correlation between short-term and medium-term returns following earnings announcements can provide a lower-risk trading strategy, particularly if the 1D and 5D returns exhibit strong correlation [7]

Core Viewpoint - PulteGroup Inc. is expected to report a decline in earnings and revenues for the second quarter of 2025, primarily due to ongoing affordability challenges in the housing market and high mortgage rates impacting homebuyers [1][2][3]. Revenue Summary - The Zacks Consensus Estimate for Q2 2025 EPS has decreased to $2.93, reflecting an 18.2% decline from the previous year's EPS of $3.58 [2]. - Revenue is projected at $4.39 billion, indicating a 4.5% year-over-year decline [2]. - Home closings are expected to be between 7,400 and 7,800 units, down from 8,097 units a year ago, with a predicted decline of 6.6% year over year to 7,561 units [3][4]. Segment Performance - Homebuilding revenues, which contributed 97.4% to total revenues in Q1 2025, are expected to decrease by 4.3% year over year to $4.3 billion due to lower home closings [4]. - Financial services revenues, contributing 2.6% to total revenues in Q1, are expected to increase by 1.4% year over year to $113.2 million [4]. Pricing and Margins - The average selling price (ASP) for homes is expected to rise between $560,000 and $570,000, compared to $549,000 a year ago, with a predicted increase of 2.4% year over year to $562,200 [5][6]. - Gross margin is anticipated to shrink to 26.7% from 29.9% last year, impacted by higher buyer incentives and cost pressures [6][7]. Orders and Backlogs - Net new orders are expected to increase by 2.1% year over year to 7,811 units, while total backlog is projected to decline by 10.8% to 11,585 units, with the total backlog value decreasing by 7.3% year over year to $7.51 billion [8]. Earnings Prediction - The model indicates that PulteGroup may not achieve an earnings beat this quarter, with an Earnings ESP of -1.27% and a Zacks Rank of 4 (Sell) [9].

Core Viewpoint - Analysts expect PulteGroup to report quarterly earnings of $2.93 per share, reflecting an 18.2% year-over-year decline, with revenues projected at $4.39 billion, down 4.5% from the previous year [1] Earnings Estimates - Revisions to earnings estimates are crucial indicators for predicting investor actions regarding the stock, with empirical research showing a strong correlation between earnings estimate trends and short-term stock performance [2] Revenue Forecasts - Analysts predict 'Homebuilding- Home sale revenues' to reach $4.23 billion, indicating a 5% decrease from the prior-year quarter [4] - 'Revenues- Financial Services' are expected to be $108.69 million, down 2.7% year over year [4] - 'Revenues- Homebuilding' is estimated at $4.26 billion, reflecting a 5.1% decline from the previous year [4] Additional Metrics - 'Homebuilding- Land sale revenues' are forecasted at $40.17 million, showing a 0.9% increase from the year-ago quarter [5] - The 'Average Selling Price - Total' is estimated at $565.10, up from $549.00 in the same quarter last year [5] - 'Net New Orders in Units - Total' is projected at 7,355, down from 7,649 a year ago [5] Backlog and Closings - 'Unit Backlog - Total' is expected to reach 11,181, compared to 12,982 last year [6] - 'Closings (units) - Total' are projected at 7,509, down from 8,097 in the same quarter last year [6] - 'Active Communities' are estimated to reach 971, up from 934 a year ago [6] Order Value and Backlog - 'Net New Orders (Value) - Total' is estimated at $4.30 billion, down from $4.36 billion last year [7] - 'Backlog Value - Total' is expected to be $7.27 billion, compared to $8.11 billion a year ago [7] Financial Services Performance - 'Income / (loss) before income taxes- Financial Services' is projected at $53.19 million, down from $63.38 million in the same quarter last year [8] Stock Performance - Over the past month, shares of PulteGroup have returned +10.2%, outperforming the Zacks S&P 500 composite's +4.2% change [8]

Group 1: Company Performance - PulteGroup's stock increased by 1.19% to $109.29, outperforming the S&P 500 which gained 0.32% [1] - Over the past month, PulteGroup shares have risen by 9.4%, while the Construction sector and S&P 500 gained 4.6% and 4.51% respectively [1] Group 2: Upcoming Earnings Disclosure - PulteGroup is set to release its earnings report on July 22, 2025, with an expected EPS of $2.94, reflecting a 17.88% decline from the previous year [2] - The consensus estimate for revenue is $4.39 billion, indicating a 4.52% decrease compared to the same quarter last year [2] Group 3: Full Year Projections - For the full year, earnings are projected at $11.48 per share and revenue at $17.24 billion, showing declines of 21.85% and 3.96% respectively from the previous year [3] Group 4: Analyst Estimates and Rankings - Recent modifications to analyst estimates for PulteGroup reflect short-term business trends, with upward revisions indicating positive sentiment towards the company's operations [4] - The Zacks Rank system, which includes estimate changes, currently ranks PulteGroup at 4 (Sell), with a 0.01% downward shift in the consensus EPS estimate over the past month [6] Group 5: Valuation Metrics - PulteGroup has a Forward P/E ratio of 9.41, which aligns with the industry average [7] - The company has a PEG ratio of 0.31, significantly lower than the industry average PEG ratio of 2.23 [7] Group 6: Industry Context - The Building Products - Home Builders industry is ranked 177 in the Zacks Industry Rank, placing it in the bottom 29% of over 250 industries [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Group 1 - PulteGroup's stock closed at $98.54, reflecting a +0.85% increase, outperforming the S&P 500's gain of 0.4% [1] - Over the past month, PulteGroup's shares have decreased by 4.75%, underperforming the Construction sector's increase of 7.66% and the S&P 500's increase of 6.69% [1] Group 2 - The upcoming earnings report for PulteGroup is scheduled for July 22, 2025, with an expected EPS of $2.94, indicating a 17.88% decline year-over-year [2] - Revenue is projected to be $4.39 billion, reflecting a 4.52% decrease compared to the same quarter last year [2] Group 3 - For the entire fiscal year, earnings are estimated at $11.48 per share and revenue at $17.24 billion, showing declines of -21.85% and -3.95% respectively from the previous year [3] Group 4 - Recent changes in analyst estimates for PulteGroup indicate the dynamic nature of near-term business trends, with upward revisions suggesting positive sentiment towards the company's operations [4] Group 5 - The Zacks Rank system, which incorporates estimate changes, currently ranks PulteGroup at 4 (Sell), with the consensus EPS estimate having decreased by 0.72% over the past month [6] Group 6 - PulteGroup has a Forward P/E ratio of 8.51, which is lower than the industry's average Forward P/E of 9.27, and a PEG ratio of 0.28 compared to the industry average of 1.71 [7] Group 7 - The Building Products - Home Builders industry, which includes PulteGroup, ranks in the bottom 9% of all industries according to the Zacks Industry Rank, indicating weaker performance compared to higher-ranked industries [8]

Group 1: Brokerage Recommendations - PulteGroup has an average brokerage recommendation (ABR) of 1.81, indicating a consensus between Strong Buy and Buy, based on 16 brokerage firms' recommendations [2] - Out of the 16 recommendations, nine are Strong Buy and one is Buy, accounting for 56.3% and 6.3% of all recommendations respectively [2] Group 2: Limitations of Brokerage Recommendations - Studies indicate that brokerage recommendations have limited success in guiding investors towards stocks with the best price increase potential [5] - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings, issuing five "Strong Buy" recommendations for every "Strong Sell" [6][10] - The interests of brokerage firms may not align with those of retail investors, leading to potential misguidance regarding stock price movements [7] Group 3: Zacks Rank vs. ABR - Zacks Rank is a proprietary stock rating tool that categorizes stocks into five groups based on earnings estimate revisions, which are strongly correlated with near-term stock price movements [8][11] - Unlike ABR, which is based solely on brokerage recommendations, Zacks Rank is a quantitative model that reflects timely earnings estimate revisions [9][12] Group 4: Current Earnings Estimates for PulteGroup - The Zacks Consensus Estimate for PulteGroup has declined by 6.9% over the past month to $11.48, indicating growing pessimism among analysts regarding the company's earnings prospects [13] - This decline in consensus estimates has resulted in a Zacks Rank of 4 (Sell) for PulteGroup, suggesting caution despite the Buy-equivalent ABR [14]