Market Guidance - The company has revised its closing guidance for 2025 down to a midpoint of 12,900 units, a reduction of 100 units from previous estimates, reflecting a choppy market environment [1][2] - Despite the adjustment in closings, the company has maintained its margin guidance without changes [2] Mortgage Applications and Market Conditions - Mortgage applications have decreased for four consecutive weeks, with the 30-year fixed mortgage rate hovering around 6.3% [3] - There is an expectation that the market will eventually respond positively to the easing conditions [3] Affordability and Market Dynamics - The company is focused on delivering homes at prices affordable for first-time buyers, with approximately 70% of its business affected by macroeconomic factors [4] - Current consumer confidence is not at a peak, and resolution of macro-level issues, including political factors and interest rate declines, is anticipated to improve market conditions [5] Industry Relations and Housing Supply - The company is actively engaging with the administration to address housing shortages and improve affordability, emphasizing that builders are eager to increase housing supply [6][7] - There is a recognition of excess inventory in the market, and the company is working to manage this responsibly while collaborating with various stakeholders to tackle the affordability issue [8][9] Inventory Management - The company is addressing mixed messages regarding the number of lots it controls, noting that some land is not yet entitled [10] - The priority remains on moving inventory quickly and responsibly, with a commitment to work with the administration to find solutions for housing affordability [11]

Core Insights - The company is focusing on innovative incentives and pricing strategies to enhance buyer confidence and affordability, particularly in well-located communities [1][3] - Despite challenging market conditions, the company reported strong third-quarter results, exceeding guidance on key metrics such as home closings volume and gross margin [3][22] - The company is strategically managing its inventory and starts volume based on community-specific conditions, with a balanced approach to pricing and incentives [4][23] Financial Performance - The company reported net income of $201 million or $2.01 per diluted share, with adjusted net income at $211 million or $2.11 per diluted share [22] - Home closings revenue reached $2 billion from delivering 3,324 homes, slightly exceeding guidance [22] - The average closing price of homes was $602,000, above the guidance of approximately $600,000 [22] Market Dynamics - Monthly net absorption rates improved throughout the quarter, with September showing the strongest pace since May, attributed to favorable mortgage interest rates [7] - The company experienced a 155% increase in attendance for its national home buying webinar, indicating growing consumer interest [8] - The mix of orders by buyer groups remained consistent, with 30% entry-level, 51% move-up, and 19% resort lifestyle [10] Inventory and Land Management - The company controls 84,564 homebuilding lots, with 60% of the supply managed through options and off-balance sheet structures, enhancing capital efficiency [15][16] - Recent negotiations resulted in an 8% average price reduction on nearly 3,400 lots, reflecting favorable land acquisition conditions [18][19] - The company expects to invest approximately $2.3 billion in homebuilding land this year, down from earlier projections [19] Consumer Engagement and Technology - The company launched an AI-powered digital assistant to enhance customer engagement and streamline the home buying process [6] - The digital assistant provides personalized, data-driven guidance, improving the online shopping experience for potential buyers [6] - The company is expanding its tech-enabled sales tools to drive cost efficiencies and enhance customer experience [5] Strategic Outlook - The company anticipates opening over 100 new communities in 2026, aiming for mid to high single-digit outlet growth [12][29] - The company is focused on balancing the mix of to-be-built and spec homes based on customer demand, with a current mix of approximately 70% spec and 30% to-be-built [13] - The company remains committed to addressing housing affordability and collaborating with stakeholders to improve access to homeownership [33][37]

Financial Data and Key Metrics Changes - The company reported net income of $201 million or $2.01 per diluted share, with adjusted net income at $211 million or $2.11 per diluted share [24] - Home closings revenue totaled $2 billion from delivering 3,324 homes, slightly exceeding guidance [24] - The average closing price of homes was $602,000, above the guidance of approximately $600,000 [24] - Home closing gross margin was reported at 22.1%, with adjusted gross margin at 22.4%, slightly ahead of guidance [26][27] - The company ended the quarter with strong liquidity of approximately $1.3 billion, including $371 million of unrestricted cash [31] Business Line Data and Key Metrics Changes - The company delivered 3,324 homes, with a total of 6,831 homes under construction, including 3,313 specs [24][25] - Spec homes accounted for 72% of third-quarter sales but 61% of closings, with expectations for increased spec closing penetration in the near term [27] - Net orders in the third quarter totaled 2,468 homes, down just under 13% year over year, driven by a moderation in monthly absorption pace [27] Market Data and Key Metrics Changes - Monthly net absorption paces improved each month during the quarter, with September pacing at the strongest level since May [11] - The mix of orders by buyer group remained consistent, with 30% entry level, 51% move up, and 19% resort lifestyle [12] - The company noted that demand trends were broad-based, with increased traffic across consumer segments [42] Company Strategy and Development Direction - The company is focused on deploying innovative incentives and pricing offers to support buyer confidence and improve affordability [7] - A strategic approach to land acquisition has been emphasized, with a goal of controlling at least 65% of lots through options and off-balance sheet structures [18] - The company plans to open over 100 new communities in 2026, anticipating mid to high single-digit outlet growth [15][29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macroeconomic and political uncertainties impacting buyer urgency and sentiment [7] - The company remains optimistic about future growth opportunities as market dynamics stabilize [9] - Management highlighted the importance of collaboration with the administration to address housing affordability issues [38] Other Important Information - The company launched an AI-powered digital assistant to enhance customer engagement and improve the home buying experience [10] - The financial services team maintained a strong capture rate of 88%, driving financial services revenue of $56 million [30] Q&A Session Summary Question: Views on potential administration actions to encourage volumes - Management discussed productive conversations with the administration regarding housing shortages and affordability [38] Question: Differences in demand trends by consumer segments - Management noted broad-based increases in traffic, with entry-level consumers showing more engagement [42] Question: Details on innovative incentives being used - Management highlighted the use of various loan programs, including buy downs and adjustable loans, to stimulate sales [49] Question: Concerns about backlog and revenue growth - Management emphasized a community-specific approach to managing specs and production cycles to align with market demand [52] Question: Regional performance insights - Management provided insights on market performance, noting strength in Florida and challenges in Texas [63][66]

Financial Data and Key Metrics Changes - The company reported net income of $201 million or $2.01 per diluted share, with adjusted net income at $211 million or $2.11 per diluted share [24] - Home closings revenue totaled $2 billion from delivering 3,324 homes, slightly exceeding guidance [24] - The average closing price of homes was $602,000, above the guidance of approximately $600,000 [24] - The reported home closing gross margin was 22.1%, with an adjusted gross margin of 22.4%, slightly ahead of guidance [26][27] - SG&A ratio improved by 80 basis points year-over-year to 9% of home closings revenue [29] Business Line Data and Key Metrics Changes - The company delivered 3,324 homes, with a total of 6,831 homes under construction, including 3,313 specs [24][25] - Spec homes accounted for 72% of third-quarter sales but only 61% of closings, indicating a shift in inventory strategy [27] - Net orders totaled 2,468 homes, down just under 13% year-over-year, with a monthly absorption pace of 2.4 homes per community [27][11] Market Data and Key Metrics Changes - The company noted that entry-level sales pulled back year-over-year, while move-up sales remained strong [13] - The mix of orders by buyer group was 30% entry level, 51% move up, and 19% resort lifestyle [12] - Florida markets showed improvement, with half of the markets up year-over-year, while Texas faced elevated inventories [63][64] Company Strategy and Development Direction - The company is focused on innovative pricing and incentives to support buyer confidence and improve affordability [7] - A balanced operating strategy is being executed to maintain performance despite market challenges [5] - The company plans to open over 100 new communities in 2026, anticipating mid to high single-digit outlet growth [15][29] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about demand trends, noting improvements in monthly net absorption rates [11] - The company is actively engaging with the administration to address housing affordability issues [38] - Management emphasized a community-specific approach to pricing and inventory management, avoiding flooding the market with unsold homes [40] Other Important Information - The company has invested $1.6 billion in home building land year-to-date, with a revised expectation of $2.3 billion for the year [19][20] - The company has a strong liquidity position of approximately $1.3 billion, including $371 million in unrestricted cash [31] Q&A Session Summary Question: Views on potential administration actions to encourage volumes - Management highlighted productive conversations with the administration regarding housing shortages and affordability [38] Question: Differences in demand trends by consumer segments - Management noted broad-based increases in traffic across consumer segments, including entry-level buyers [42] Question: Details on innovative incentives being used - Management discussed various financing options, including buy downs and adjustable-rate mortgages, to stimulate sales [48] Question: Concerns about backlog and revenue growth - Management emphasized a community-specific approach to inventory management and the ability to ramp up starts if market conditions improve [52] Question: Regional performance insights - Management provided insights on market performance, noting strength in Florida and challenges in Texas [63][64] Question: Details on new community openings and Esplanade expansion - Management confirmed plans for new Esplanade communities and emphasized excitement about upcoming openings [79]

Financial Data and Key Metrics Changes - The company reported net income of $201 million or $2.01 per diluted share, with adjusted net income at $211 million or $2.11 per diluted share [20][24] - Home closings revenue reached $2 billion from delivering 3,324 homes, slightly exceeding guidance [20][24] - The average closing price of homes was $602,000, ahead of the guidance of approximately $600,000 [20][24] - Home closing gross margin was reported at 22.1%, with adjusted gross margin at 22.4%, slightly above the guidance of approximately 22% [23][24] Business Line Data and Key Metrics Changes - The company started 1,963 homes during the quarter, with an average of 1.9 homes per community [21] - Spec homes accounted for 72% of third-quarter sales but only 61% of closings, indicating a shift in inventory strategy [24] - The company expects to deliver between 3,100 to 3,300 homes in Q4, leading to a full-year target of 12,800 to 13,000 homes [23][24] Market Data and Key Metrics Changes - Monthly net absorption improved each month during the quarter, with September showing the strongest level since May [9] - The mix of orders by buyer group remained consistent: 30% entry level, 51% move-up, and 19% resort lifestyle [10] - Cancellation rates increased to 10.1% of the beginning backlog, but remained below industry averages [25] Company Strategy and Development Direction - The company is focused on innovative pricing and incentives to support buyer confidence and improve affordability [5][6] - A balanced operating strategy is being executed to maintain performance despite market challenges [4][7] - The company plans to open over 100 new communities in 2026, anticipating mid to high single-digit outlet growth [12][25] Management's Comments on Operating Environment and Future Outlook - Management noted that macroeconomic and political uncertainties have impacted buyer urgency and sentiment [5][10] - The company is optimistic about future growth as market dynamics stabilize, emphasizing cost management and operational efficiencies [7][10] - Management highlighted the importance of consumer confidence in driving demand stabilization, particularly in discretionary home purchases [10][11] Other Important Information - The company ended the quarter with strong liquidity of approximately $1.3 billion, including $371 million in unrestricted cash [27] - The net home building debt to capitalization ratio was 21.3%, down from 22.5% a year ago [27] - The company repurchased 1.3 million shares for $75 million during the quarter, with a total of 5.3 million shares repurchased year-to-date [27][28] Q&A Session Summary Question: Views on potential administration actions to encourage volumes - Management discussed productive conversations with the administration regarding housing shortages and affordability issues, emphasizing the need for collaboration among stakeholders [33][35] Question: Recent demand trends and consumer segment engagement - Management noted broad-based increases in traffic across consumer segments, with particular engagement from entry-level buyers [37][38] Question: Details on innovative incentives being used - Management highlighted the use of various loan programs, including buy downs and adjustable-rate mortgages, to cater to different customer needs [42][44] Question: Spec inventory and its impact on future revenues - Management acknowledged the need to balance inventory levels with market demand, indicating a cautious approach to new spec starts [46][55] Question: Regional performance and market strength - Management provided insights on regional performance, noting strength in Florida and challenges in Texas, while emphasizing the importance of core assets [58][60]

Financial Data and Key Metrics Changes - The company reported net income of $201 million or $2.01 per diluted share, with adjusted net income at $211 million or $2.11 per diluted share [22] - Home closings revenue reached $2 billion, with 3,324 homes delivered, slightly exceeding guidance [23] - The average closing price of homes was $602,000, above the guidance of approximately $600,000 [23] - Home closing gross margin was reported at 22.1%, with adjusted gross margin at 22.4%, slightly ahead of guidance [26] Business Line Data and Key Metrics Changes - The company started 1,963 homes during the quarter, with 6,831 homes under construction, including 3,313 spec homes [24] - Spec home sales accounted for 72% of third-quarter sales, with expectations for increased penetration in the near term [27] - Net orders totaled 2,468 homes, down nearly 13% year-over-year, with a cancellation rate of 10.1% of the beginning backlog [28] Market Data and Key Metrics Changes - Monthly net absorption improved each month during the quarter, with September pacing at the strongest level since May [10] - The mix of orders by buyer group remained consistent, with 30% entry level, 51% move up, and 19% resort lifestyle [11] - The company noted that demand trends were broad-based across consumer segments, with entry-level traffic picking up as mortgage rates improved [41] Company Strategy and Development Direction - The company is focused on innovative pricing and incentives to support buyer confidence and improve affordability [6] - A balanced operating strategy is being executed, with a well-structured land bank providing flexible lot supply [7] - The company plans to open over 100 new communities in 2026, anticipating mid to high single-digit outlet growth [13] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macroeconomic and political uncertainties impacting buyer urgency and sentiment [5] - The company remains optimistic about the potential for demand stabilization as consumer confidence improves [11] - Management emphasized the importance of collaboration with the administration to address housing affordability issues [39] Other Important Information - The company has invested $1.6 billion in homebuilding land year-to-date, with expectations to invest approximately $2.3 billion this year [19] - The financial services team maintained a strong capture rate of 88%, driving financial services revenue of $56 million [29] - The company ended the quarter with strong liquidity of approximately $1.3 billion [30] Q&A Session Summary Question: Views on potential actions from the administration to encourage volume - Management highlighted productive conversations with the administration regarding overcoming housing shortages and making housing more affordable [37] Question: Differences in demand trends by consumer segment - Management noted broad-based increases in traffic across consumer segments, with entry-level consumers becoming more engaged [41] Question: Details on innovative incentives being used - Management indicated a variety of programs including buy downs, adjustable loans, and proprietary loans to stimulate demand [48] Question: How to drive revenues with a significant backlog decrease - Management emphasized a community-specific approach to balance profitability and volume, with flexibility to ramp up starts if market conditions allow [55] Question: Insights on land renegotiations and margin impacts - Management reported successful renegotiations on approximately 3,400 lots, resulting in an average price reduction of 8% [105]

Financial Performance - Reported net income for Q3 2025 was $201 million, or $2.01 per diluted share, while adjusted net income was $211 million, or $2.11 per diluted share[2]. - Net income for Q3 2025 was $201,441, down 19.8% from $251,126 in Q3 2024[23]. - Adjusted net income for Q3 2025 was $210,873, a decrease of 17.3% from $254,841 in Q3 2024[36]. - Total revenue for Q3 2025 was $2,095,751, slightly down from $2,120,842 in Q3 2024, representing a decrease of 1.2%[37]. - Total revenue for the nine months ended September 30, 2025, increased to $6,021,840, up 3.6% from $5,811,647 in the same period of 2024[23]. - Adjusted EBITDA for Q3 2025 was $333,147, down 12.1% from $379,178 in Q3 2024[41]. Home Closings and Sales - Home closings revenue decreased 1% to $2.0 billion, with 3,324 closings at an average sales price of $602,000, slightly ahead of prior guidance[5][10]. - Home closings revenue for Q3 2025 was $2,000,909, a decrease of 1.4% compared to $2,029,134 in Q3 2024[23]. - Net sales orders declined 13% to 2,468, driven by a decrease in monthly absorption pace to 2.4 from 2.8 a year ago[10]. - Net sales orders for Q3 2025 totaled 2,468, a decrease of 12.8% from 2,830 in Q3 2024, with a sales value of $1,399,961, down 15.7%[27]. - The sales order backlog as of September 30, 2025, was 3,605 homes, a decrease of 36.7% from 5,692 homes in 2024, with a sales value of $2,337,564[28]. - For Q4 2025, home closings are expected to be between 3,100 to 3,300, with an average closing price of approximately $590,000[13]. Margins and Costs - Home closings gross margin was 22.1%, down from 24.8% a year ago, reflecting a 270 basis points decrease[15]. - Home closings gross margin as a percentage of home closings revenue was 22.1% in Q3 2025, down from 24.8% in Q3 2024[39]. - The company reported a gross margin of $476,621 for Q3 2025, down from $531,069 in Q3 2024[23]. - Income before income taxes margin decreased to 13.0% in Q3 2025 from 15.7% in Q3 2024[37]. Assets and Equity - Total assets increased to $9,627,560 as of September 30, 2025, compared to $9,297,131 at the end of 2024[25]. - Total stockholders' equity rose to $6,197,515 as of September 30, 2025, up from $5,878,180 at the end of 2024[25]. Debt and Liquidity - Total homebuilding debt was $2,045,883 as of September 30, 2025, an increase from $1,916,948 as of September 30, 2024[43]. - Net homebuilding debt to capitalization ratio improved to 21.3% as of September 30, 2025, compared to 22.5% as of September 30, 2024[43]. - Total liquidity at quarter end was approximately $1.3 billion, including $955 million of total capacity on the revolving credit facility[13]. Shareholder Actions - Share repurchases totaled 1.3 million shares for $75 million, with remaining authorization of $600 million[13]. - Basic weighted average number of shares decreased to 98,439 in Q3 2025 from 104,132 in Q3 2024[36]. Community and Development - The company ended Q3 2025 with 349 active selling communities, a 2.6% increase from 340 in Q3 2024[29]. - Homebuilding land investment totaled $533 million, with 50% allocated to development-related expenses[10]. - Homebuilding land acquisition and development investment is now expected to be approximately $2.3 billion for the full year[13].

Financial Performance - Net sales orders decreased by 13% year-over-year, from 2,830 in 3Q 2024 to 2,468 in 3Q 2025[12] - Home closings revenue, net, decreased by 1%, from $2.029 billion in 3Q 2024 to $2.001 billion in 3Q 2025[12] - Home closings decreased by 2%, from 3,394 in 3Q 2024 to 3,324 in 3Q 2025[12] - Home closings ASP increased by 1%, from $598,000 in 3Q 2024 to $602,000 in 3Q 2025[12] - Reported diluted EPS decreased by 15%, from $2.37 in 3Q 2024 to $2.01 in 3Q 2025[12] - Adjusted diluted EPS decreased by 12%, from $2.40 in 3Q 2024 to $2.11 in 3Q 2025[12] - Book value per share increased by 15%, from $53.95 in 3Q 2024 to $61.95 in 3Q 2025[12] - The company has $1.3 billion in total liquidity[13] Land and Lots - The company has 84,564 total homebuilding lots, with 60% controlled[13] - The total lot supply is equivalent to 6.4 years, with 2.6 years owned[13] - Homebuilding land investment is expected to total approximately $2.3 billion in 2025[15, 53] Geographic Footprint - The West region accounts for 36% of home closings and 44% of home closings revenue, with an ASP of $723,000 and a gross margin of 22.1%[18] - The Central region accounts for 23% of home closings and 19% of home closings revenue, with an ASP of $511,000 and a gross margin of 21.5%[18] - The East region accounts for 41% of home closings and 37% of home closings revenue, with an ASP of $544,000 and a gross margin of 22.5%[18]

Core Insights - Taylor Morrison Home (TMHC) reported quarterly earnings of $2.11 per share, exceeding the Zacks Consensus Estimate of $1.93 per share, but down from $2.37 per share a year ago, resulting in an earnings surprise of +9.33% [1] - The company achieved revenues of $2.1 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.76%, although this is a slight decrease from $2.12 billion in the same quarter last year [2] - Taylor Morrison has consistently surpassed consensus EPS estimates over the last four quarters, indicating a strong performance trend [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.18 on revenues of $2.16 billion, while for the current fiscal year, the estimate is $8.01 on revenues of $8.09 billion [7] - The company's earnings outlook is crucial for investors, as it reflects current consensus expectations and any recent changes in those expectations [4] Market Performance - Taylor Morrison shares have increased by approximately 2.3% since the beginning of the year, in contrast to the S&P 500's gain of 14.5%, indicating underperformance relative to the broader market [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting it is expected to underperform the market in the near future due to unfavorable estimate revisions prior to the earnings release [6] Industry Context - The Building Products - Home Builders industry, to which Taylor Morrison belongs, is currently ranked in the bottom 17% of over 250 Zacks industries, which may negatively impact the stock's performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, highlighting the importance of monitoring these revisions for investment decisions [5]

Accessibility StatementSkip Navigation All comparisons are of the current quarter to the prior-year quarter, unless indicated. Homebuilding Land Portfolio SCOTTSDALE, Ariz., Oct. 22, 2025 /PRNewswire/ --Â Taylor Morrison Home Corporation (NYSE: TMHC), a leading national land developer and homebuilder, announced results for the third quarter ended Sept. 30, 2025. Reported net income was $201 million, or $2.01 per diluted share, while adjusted net income was $211 million, or $2.11 per diluted share. Third qua ...