[Statement on Forward-Looking Information](index=3&type=section&id=Statement%20on%20Forward-Looking%20Information) This section clarifies that forward-looking statements are subject to risks and uncertainties, and the company does not commit to updating them publicly - Forward-looking statements are identified by words like "anticipate," "estimate," "expect," and relate to future events, not historical facts[11](index=11&type=chunk) - Major risks include general economic conditions (employment, interest rates, inflation), market demand, land availability, capital access, competition, material/labor costs, natural disasters, and tax policies[13](index=13&type=chunk)[17](index=17&type=chunk) - The company does not undertake to publicly update any forward-looking statements[14](index=14&type=chunk) [PART I. Financial Information](index=5&type=section&id=PART%20I.%20Financial%20Information) [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including the balance sheets, statements of operations and comprehensive income, statements of changes in equity, and statements of cash flows, along with their accompanying notes, providing a detailed financial overview for the reported interim periods [Condensed Consolidated Balance Sheets (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) This statement provides a snapshot of the company's assets, liabilities, and equity at specific interim dates, reflecting its financial position Condensed Consolidated Balance Sheets (Amounts in thousands) | ASSETS | July 31, 2025 (unaudited) | October 31, 2024 | | :----------------------------------- | :------------------------ | :----------------- | | Cash and cash equivalents | $ 852,311 | $ 1,303,039 | | Inventory | 11,071,549 | 9,712,925 | | Total Assets | $ 14,396,821 | $ 13,367,932 | | **LIABILITIES AND EQUITY** | | | | Total Liabilities | 6,285,614 | 5,681,217 | | Total Equity | 8,111,207 | 7,686,715 | | Total Liabilities and Equity | $ 14,396,821 | $ 13,367,932 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Unaudited)) This statement details the company's revenues, costs, and net income over specific interim periods, along with earnings per share data Condensed Consolidated Statements of Operations and Comprehensive Income (Amounts in thousands, except per share data) | Metric | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Revenues | $ 2,945,117 | $ 2,727,944 | $ 7,543,325 | $ 7,513,278 | | Cost of revenues | 2,203,726 | 1,985,940 | 5,636,951 | 5,371,589 | | Income from operations | 487,719 | 497,191 | 1,156,528 | 1,429,132 | | Net income | $ 369,621 | $ 374,611 | $ 899,771 | $ 1,095,786 | | Basic earnings per share | $ 3.76 | $ 3.64 | $ 9.02 | $ 10.51 | | Diluted earnings per share | $ 3.73 | $ 3.60 | $ 8.95 | $ 10.40 | [Condensed Consolidated Statements of Changes in Equity (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity%20(Unaudited)) This statement outlines the changes in the company's equity components, including net income, treasury stock transactions, and dividends, over interim periods Key Changes in Equity (Nine months ended July 31, 2025 vs. October 31, 2024) | Item | Balance, October 31, 2024 (thousands) | Net Income (thousands) | Purchase of Treasury Stock (thousands) | Dividends Declared (thousands) | Balance, July 31, 2025 (thousands) | | :-------------------------- | :------------------------------------ | :--------------------- | :----------------------------------- | :----------------------------- | :--------------------------------- | | Total Equity | $ 7,686,715 | $ 899,771 | $ (402,468) | $ (72,987) | $ 8,111,207 | - Total stockholders' equity increased from **$7.67 billion** at October 31, 2024, to **$8.10 billion** at July 31, 2025[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) This statement reports the cash generated and used by operating, investing, and financing activities, showing the net change in cash over interim periods Condensed Consolidated Statements of Cash Flows (Amounts in thousands) | Cash Flow Activity | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Net cash provided by operating activities | $ 312,381 | $ 327,656 | | Net cash used in investing activities | (240,169) | (116,034) | | Net cash used in financing activities | (504,356) | (592,689) | | Net decrease in cash, cash equivalents, and restricted cash | (432,144) | (381,067) | | Cash, cash equivalents, and restricted cash, end of period | $ 938,291 | $ 963,274 | [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section provides detailed disclosures and explanations for the figures presented in the condensed consolidated financial statements, covering significant accounting policies, inventory, investments, debt, equity, and other financial instruments [1. Significant Accounting Policies](index=10&type=section&id=1.%20Significant%20Accounting%20Policies) This section outlines the key accounting principles and methods used in preparing the financial statements, including revenue recognition and recent pronouncements - The financial statements are prepared in accordance with SEC rules for interim information and U.S. GAAP, with October 31, 2024, balance sheet amounts derived from audited statements[31](index=31&type=chunk) - Home sales revenue is recognized upon home delivery and title transfer; contract liabilities (customer deposits) were **$483.9 million** at July 31, 2025[33](index=33&type=chunk) - Recent accounting pronouncements include ASU 2023-05 (Joint Venture Formations, adopted Jan 1, 2025), ASU 2023-07 (Segment Reporting, effective FY2025), ASU 2023-09 (Income Tax Disclosures, effective FY2026), and ASU 2024-03 (Expense Disaggregation, effective FY2028)[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk) [2. Inventory](index=12&type=section&id=2.%20Inventory) This section details the composition of inventory, including land and homes under construction, and reports any impairment charges recognized during the periods Major Components of Inventory (Amounts in thousands) | Component | July 31, 2025 | October 31, 2024 | | :------------------------------------------------- | :-------------- | :--------------- | | Land deposits and costs of future communities | $ 866,503 | $ 620,040 | | Land and land development costs | 2,982,669 | 2,532,221 | | Land and land development costs (homes under construction) | 3,828,611 | 3,617,266 | | Homes under construction | 2,851,445 | 2,458,541 | | Model homes | 542,321 | 484,857 | | **Total Inventory** | **$ 11,071,549** | **$ 9,712,925** | Inventory Impairment Charges (Amounts in thousands) | Category | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Land controlled for future communities | $ 15,815 | $ 1,759 | $ 21,446 | $ 4,518 | | Operating communities | 7,500 | 3,700 | 28,085 | 30,840 | | **Total** | **$ 23,315** | **$ 5,459** | **$ 49,531** | **$ 35,358** | - At July 31, 2025, the company identified **335 land purchase contracts** with an aggregate purchase price of **$7.07 billion** as Variable Interest Entities (VIEs), on which **$755.4 million** in deposits had been made, but the company was not the primary beneficiary of any[46](index=46&type=chunk) [3. Investments in Unconsolidated Entities](index=13&type=section&id=3.%20Investments%20in%20Unconsolidated%20Entities) This section provides information on the company's equity method investments in joint ventures, including their types, total investment, and remaining funding commitments - The company has investments in **63 active unconsolidated joint ventures** (20 Land Development, 1 Home Building, 40 Rental Property, 2 Other) as of July 31, 2025, with a total investment of **$1.12 billion**[49](index=49&type=chunk) - Remaining funding commitment to unconsolidated entities was **$353.8 million** at July 31, 2025[49](index=49&type=chunk) Unconsolidated Entities Debt Financing (Amounts in thousands) | Category | Aggregate Loan Commitments (July 31, 2025) | Amounts Borrowed (July 31, 2025) | | :-------------------- | :----------------------------------- | :------------------------------- | | Land Development JVs | $ 839,043 | $ 542,394 | | Home Building JVs | 63,500 | 5,904 | | Rental Property JVs | 3,448,201 | 2,836,479 | | **Total** | **$ 4,350,744** | **$ 3,384,777** | - The company's maximum estimated exposure under repayment and carry cost guarantees for unconsolidated entities' debt was **$523.0 million** at July 31, 2025, for borrowed obligations[62](index=62&type=chunk) [4. Receivables, Prepaid Expenses, and Other Assets](index=17&type=section&id=4.%20Receivables%2C%20Prepaid%20Expenses%2C%20and%20Other%20Assets) This section details the various components of current and non-current assets, including expected insurance recoveries, properties held for development, and right-of-use assets Receivables, Prepaid Expenses, and Other Assets (Amounts in thousands) | Component | July 31, 2025 | October 31, 2024 | | :------------------------------------------ | :-------------- | :--------------- | | Expected recoveries from insurance carriers | $ 104,194 | $ 109,569 | | Properties held for rental/commercial development | 118,822 | 116,802 | | Right-of-use assets | 109,565 | 108,311 | | **Total** | **$ 602,623** | **$ 590,611** | [5. Loans Payable, Senior Notes, and Mortgage Company Loan Facilities](index=17&type=section&id=5.%20Loans%20Payable%2C%20Senior%20Notes%2C%20and%20Mortgage%20Company%20Loan%20Facilities) This section outlines the company's debt structure, including term loans, revolving credit facilities, and senior notes, detailing their terms, interest rates, and recent changes Loans Payable (Amounts in thousands) | Component | July 31, 2025 | October 31, 2024 | | :-------------------------- | :-------------- | :--------------- | | Senior unsecured term loan | $ 650,000 | $ 650,000 | | Loans payable – other | 404,726 | 437,969 | | Deferred issuance costs | (3,231) | (2,152) | | **Total Loans Payable** | **$ 1,051,495** | **$ 1,085,817** | - The **$650.0 million** senior unsecured term loan facility's maturity date was extended to February 7, 2030, with an interest rate of **5.20%** per annum at July 31, 2025[68](index=68&type=chunk) - The senior unsecured revolving credit facility was increased from **$1.96 billion** to **$2.35 billion** and extended to February 7, 2030; no outstanding borrowings at July 31, 2025[70](index=70&type=chunk)[72](index=72&type=chunk) - In June 2025, the company issued **$500.0 million** of **5.600% Senior Notes** due 2035 and redeemed **$350.0 million** of **4.875% Senior Notes** due November 2025[75](index=75&type=chunk) [6. Accrued Expenses](index=19&type=section&id=6.%20Accrued%20Expenses) This section details the various accrued liabilities, including land development, construction, compensation, self-insurance, and warranty obligations, along with their changes Accrued Expenses (Amounts in thousands) | Component | July 31, 2025 | October 31, 2024 | | :------------------------------------------ | :-------------- | :--------------- | | Land development and construction | $ 280,427 | $ 356,613 | | Liabilities related to consolidated inventory not owned | 762,934 | 388,778 | | Compensation and employee benefits | 196,663 | 208,394 | | Self-insurance | 253,736 | 242,306 | | Warranty | 195,393 | 189,258 | | **Total Accrued Expenses** | **$ 2,082,387** | **$ 1,752,848** | Warranty Accrual Reconciliation (Amounts in thousands) | Item | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Balance, beginning of period | $ 189,258 | $ 206,171 | | Additions – homes closed | 31,550 | 24,714 | | Charges incurred | (31,185) | (38,182) | | **Balance, end of period** | **$ 195,393** | **$ 210,980** | [7. Income Taxes](index=19&type=section&id=7.%20Income%20Taxes) This section presents the income tax provisions and effective tax rates for the reported periods, including details on state income tax rates Income Tax Provisions and Effective Rates | Period | Income Tax Provision (thousands) | Effective Tax Rate | | :----------------------------------- | :------------------------------- | :----------------- | | Three months ended July 31, 2025 | $ 129,879 | 26.0% | | Three months ended July 31, 2024 | $ 129,016 | 25.6% | | Nine months ended July 31, 2025 | $ 298,614 | 24.9% | | Nine months ended July 31, 2024 | $ 368,781 | 25.2% | - The estimated state income tax rate for fiscal year 2025 is approximately **5.6%**, down from **6.3%** in fiscal year 2024[80](index=80&type=chunk) [8. Stock-Based Benefit Plans](index=20&type=section&id=8.%20Stock-Based%20Benefit%20Plans) This section reports the stock-based compensation expense and related tax benefits, along with the unamortized value of unvested awards Stock-Based Compensation Expense and Tax Benefit (Amounts in thousands) | Item | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Total stock-based compensation expense | $ 4,315 | $ 3,812 | $ 27,110 | $ 25,951 | | Income tax benefit recognized | $ 1,072 | $ 986 | $ 6,837 | $ 6,662 | - The aggregate unamortized value of unvested stock-based compensation awards was approximately **$27.2 million** at July 31, 2025, up from **$21.8 million** at October 31, 2024[82](index=82&type=chunk) [9. Stockholders' Equity](index=20&type=section&id=9.%20Stockholders'%20Equity) This section details changes in stockholders' equity, including share repurchase authorizations, actual repurchases, and dividend declarations - The Board of Directors renewed authorization to repurchase **20 million shares** of common stock on December 13, 2023, with no expiration date[83](index=83&type=chunk) Share Repurchase Program (Shares in thousands) | Period | Shares Purchased | Average Price Per Share | Remaining Authorization at July 31 | | :-------------------------- | :--------------- | :---------------------- | :------------------------------- | | Three months ended July 31, 2025 | 1,791 | $ 112.40 | 11,464 | | Nine months ended July 31, 2025 | 3,623 | $ 111.08 | 11,464 | - Quarterly cash dividend increased from **$0.23 to $0.25 per share** on March 11, 2025[85](index=85&type=chunk) [10. Earnings per Share Information](index=21&type=section&id=10.%20Earnings%20per%20Share%20Information) This section provides the calculation of basic and diluted earnings per share, including net income and weighted-average shares outstanding Earnings Per Share Calculation (Amounts in thousands, except per share data) | Metric | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net income | $ 369,621 | $ 374,611 | $ 899,771 | $ 1,095,786 | | Basic weighted-average shares | 98,434 | 102,980 | 99,718 | 104,299 | | Diluted weighted-average shares | 99,170 | 104,014 | 100,529 | 105,361 | [11. Fair Value Disclosures](index=22&type=section&id=11.%20Fair%20Value%20Disclosures) This section provides fair value measurements for financial instruments, including mortgage loans held for sale, interest rate swaps, and debt, categorized by valuation hierarchy Financial Instruments Measured at Fair Value (Amounts in thousands) | Financial Instrument | Fair Value Hierarchy | July 31, 2025 | October 31, 2024 | | :----------------------------------- | :------------------- | :-------------- | :--------------- | | Mortgage Loans Held for Sale | Level 2 | $ 185,127 | $ 191,242 | | Interest Rate Swap Contracts | Level 2 | $ 4,081 | $ 15,283 | - The fair value of interest rate swap contracts is classified as **Level 2**, with credit valuation adjustments utilizing Level 3 inputs, though their impact was not significant[90](index=90&type=chunk) Debt Book Value vs. Estimated Fair Value (Amounts in thousands) | Debt Type | Fair Value Hierarchy | Book Value (July 31, 2025) | Estimated Fair Value (July 31, 2025) | Book Value (October 31, 2024) | Estimated Fair Value (October 31, 2024) | | :----------------------------------- | :------------------- | :--------------------------- | :----------------------------------- | :---------------------------- | :------------------------------------ | | Loans payable | Level 2 | $ 1,054,726 | $ 1,042,520 | $ 1,087,969 | $ 1,069,577 | | Senior notes | Level 1 | 1,750,000 | 1,739,160 | 1,600,000 | 1,572,580 | | Mortgage company loan facility | Level 2 | 150,000 | 150,000 | 150,000 | 150,000 | | **Total** | | **$ 2,954,726** | **$ 2,931,680** | **$ 2,837,969** | **$ 2,792,157** | [12. Other Income – Net](index=23&type=section&id=12.%20Other%20Income%20%E2%80%93%20Net) This section details the components of other income, including interest income, ancillary business income, and management fees, explaining significant changes Components of Other Income – Net (Amounts in thousands) | Component | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Interest income | $ 6,955 | $ 9,033 | $ 22,978 | $ 28,508 | | Income from ancillary businesses | 6,548 | 5,405 | 14,737 | 11,152 | | Management fee income | 925 | 985 | 2,696 | 3,291 | | Other | (1,635) | 1,527 | (288) | 6,283 | | **Total other income – net** | **$ 12,793** | **$ 16,950** | **$ 40,123** | **$ 49,234** | - Income from ancillary businesses increased due to higher mortgage operations closing volume and reduced write-offs in Apartment Living operations, partially offset by lower management fees from high-rise urban luxury condominium operations[96](index=96&type=chunk)[97](index=97&type=chunk) [13. Commitments and Contingencies](index=24&type=section&id=13.%20Commitments%20and%20Contingencies) This section discusses legal claims, land purchase contracts, surety bonds, and sales backlog, assessing their potential financial impact on the company - The company is involved in various legal claims and litigation, but believes adequate provision has been made and disposition will not materially adversely affect financial condition[99](index=99&type=chunk) Land Purchase Contracts (Amounts in thousands) | Item | July 31, 2025 | October 31, 2024 | | :----------------------------------- | :-------------- | :--------------- | | Aggregate purchase price | $ 7,404,921 | $ 6,100,630 | | Deposits against aggregate purchase price | 782,200 | 549,195 | | Additional cash required to acquire land | 6,622,721 | 5,551,435 | - At July 31, 2025, outstanding surety bonds totaled **$852.5 million** for community improvements and **$397.1 million** for other obligations, with no probable draws expected[104](index=104&type=chunk) - Backlog at July 31, 2025, consisted of **5,492 homes** with an aggregate sales value of **$6.38 billion**[107](index=107&type=chunk) [14. Information on Segments](index=25&type=section&id=14.%20Information%20on%20Segments) This section provides financial data broken down by the company's five geographic operating segments, including revenues and income before income taxes - The company operates in **five geographic segments**: North, Mid-Atlantic, South, Mountain, and Pacific[111](index=111&type=chunk)[112](index=112&type=chunk) Total Consolidated Revenues by Segment (Amounts in thousands) | Segment | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | North | $ 438,698 | $ 375,119 | $ 1,071,899 | $ 982,991 | | Mid-Atlantic | 400,718 | 335,721 | 958,715 | 975,985 | | South | 757,881 | 776,262 | 2,022,789 | 1,967,522 | | Mountain | 730,250 | 670,027 | 2,042,828 | 1,726,976 | | Pacific | 553,067 | 566,336 | 1,332,415 | 1,650,015 | | **Total home building** | **$ 2,880,614** | **$ 2,723,465** | **$ 7,428,646** | **$ 7,303,489** | Total Consolidated Income (Loss) Before Income Taxes by Segment (Amounts in thousands) | Segment | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | North | $ 97,016 | $ 64,615 | $ 207,377 | $ 149,058 | | Mid-Atlantic | 71,328 | 73,470 | 167,985 | 377,513 | | South | 146,869 | 161,177 | 400,127 | 386,072 | | Mountain | 137,949 | 113,785 | 356,617 | 275,899 | | Pacific | 106,006 | 145,911 | 233,822 | 420,445 | | **Total home building** | **$ 559,168** | **$ 558,958** | **$ 1,365,928** | **$ 1,608,987** | [15. Supplemental Disclosure to Condensed Consolidated Statements of Cash Flows](index=28&type=section&id=15.%20Supplemental%20Disclosure%20to%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section provides additional details on cash flow activities, including income taxes paid, inventory acquired through financing, and the composition of cash and restricted cash Supplemental Cash Flow Information (Amounts in thousands) | Item | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | | Income tax paid – net | $ 256,513 | $ 397,666 | | Cost of inventory acquired through seller financing, municipal bonds, or included in accrued expenses - net | $ 441,821 | $ 228,660 | | Increase in inventory due to consolidation of joint ventures | $ 69,277 | $ — | Cash, Cash Equivalents, and Restricted Cash (Amounts in thousands) | Item | At July 31, 2025 | At July 31, 2024 | | :----------------------------------- | :--------------- | :--------------- | | Cash and cash equivalents | $ 852,311 | $ 893,422 | | Restricted cash | 85,980 | 69,852 | | **Total** | **$ 938,291** | **$ 963,274** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A")](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial performance and condition, discussing key trends, operational highlights, and factors influencing revenues, costs, and profitability, along with an analysis of liquidity and capital resources [OVERVIEW](index=29&type=section&id=OVERVIEW) This section provides a high-level summary of market conditions, sales trends, and the company's strategic responses, including its long-term outlook for the new home market - Net contracts signed decreased **4.1% in units** but increased **0.2% in value** for the three months ended July 31, 2025, compared to the prior year, attributed to affordability pressures and volatile economic conditions[122](index=122&type=chunk) - The company strategically manages pricing and incentives to balance sales pace and margin, and reduced spec home starts due to weaker demand[122](index=122&type=chunk)[123](index=123&type=chunk) - Long-term outlook for the new home market remains positive due to favorable demographics, structural undersupply, aging existing homes, and wealth appreciation[122](index=122&type=chunk) [Financial and Operational Highlights](index=30&type=section&id=Financial%20and%20Operational%20Highlights) This section summarizes key financial and operational metrics, including revenues, net income, contracts signed, and liquidity position, for the reported periods Key Financial Highlights (Amounts in millions, except units) | Metric | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Revenues | $ 2,945.1 | $ 2,727.9 | $ 7,543.3 | $ 7,513.3 | | Net income | $ 369.6 | $ 374.6 | $ 899.8 | $ 1,095.8 | | Net contracts signed – value | $ 2,412.0 | $ 2,407.5 | $ 7,323.6 | $ 7,413.3 | | Net contracts signed – units | 2,388 | 2,490 | 7,345 | 7,573 | - Backlog value decreased **10% to $6.38 billion** (**5,492 homes**) at July 31, 2025, compared to **$7.07 billion** (**6,769 homes**) at July 31, 2024[127](index=127&type=chunk) - At July 31, 2025, the company had **$852.3 million** in cash and cash equivalents and **$2.19 billion** available under its **$2.35 billion** revolving credit facility[128](index=128&type=chunk) [RESULTS OF OPERATIONS – OVERVIEW](index=31&type=section&id=RESULTS%20OF%20OPERATIONS%20%E2%80%93%20OVERVIEW) This section provides a consolidated summary of the company's financial performance, including home sales, land sales, net income, and key operational metrics like deliveries and contracts signed Consolidated Financial Performance Summary (Amounts in millions, except percentages and units) | Metric | 3 Months Ended July 31, 2025 | 3 Months Ended July 31, 2024 | % Change | 9 Months Ended July 31, 2025 | 9 Months Ended July 31, 2024 | % Change | | :----------------------------------- | :--------------------------- | :--------------------------- | :------- | :--------------------------- | :--------------------------- | :------- | | Home sales revenue | $ 2,881.0 | $ 2,724.5 | 6 % | $ 7,428.2 | $ 7,303.3 | 2 % | | Land sales and other revenue | 64.1 | 3.5 | NM | 115.1 | 210.0 | (45)% | | Net income | $ 369.6 | $ 374.6 | (1)% | $ 899.8 | $ 1,095.8 | (18)% | | Deliveries – units | 2,959 | 2,814 | 5 % | 7,849 | 7,382 | 6 % | | Deliveries – average delivered price (in '000s) | $ 973.6 | $ 968.2 | 1 % | $ 946.4 | $ 989.3 | (4)% | | Net contracts signed – units | 2,388 | 2,490 | (4)% | 7,345 | 7,573 | (3)% | | Net contracts signed – average contracted price (in '000s) | $ 1,010.1 | $ 966.9 | 4 % | $ 997.1 | $ 978.9 | 2 % | [Home Sales Revenues and Home Sales Cost of Revenues](index=32&type=section&id=Home%20Sales%20Revenues%20and%20Home%20Sales%20Cost%20of%20Revenues) This section analyzes the drivers of home sales revenue and cost of revenues, including delivery volumes, average prices, product mix shifts, and impairment charges - Home sales revenues increased **6%** for the three months ended July 31, 2025, driven by a **5% increase in deliveries** and a **1% increase in average delivered price**, due to more operating communities, spec home deliveries, and improved construction cycle times[135](index=135&type=chunk) - Home sales cost of revenues as a percentage of home sales revenues increased due to a shift to lower-margin products/regions (notably Pacific) and higher inventory impairment charges, along with increased sales incentives[136](index=136&type=chunk)[138](index=138&type=chunk) - For the nine months ended July 31, 2025, home sales revenues increased **2%**, with a **6% rise in deliveries** offset by a **4% decrease in average delivered price**, mainly due to a mix shift to less expensive product types/regions[137](index=137&type=chunk) [Land Sales and Other Revenues and Land Sales and Other Cost of Revenues](index=32&type=section&id=Land%20Sales%20and%20Other%20Revenues%20and%20Land%20Sales%20and%20Other%20Cost%20of%20Revenues) This section explains the fluctuations in land sales and other revenues and their associated costs, highlighting the impact of significant non-recurring land sales and impairment charges - Land sales and other revenues decreased significantly for the nine months ended July 31, 2025, primarily due to the non-recurrence of a **$180.7 million land parcel sale** in Q2 2024 that generated a **$175.2 million pre-tax gain**[139](index=139&type=chunk) - Land sales and other cost of revenues as a percentage of revenues increased for the nine months ended July 31, 2025, influenced by the low-basis 2024 land sale and higher impairment charges (**$2.6 million** in 2025 vs. **$4.4 million** in 2024)[140](index=140&type=chunk) [Selling, General and Administrative Expenses ("SG&A")](index=34&type=section&id=Selling%2C%20General%20and%20Administrative%20Expenses%20(%22SG%26A%22)) This section analyzes changes in SG&A expenses, attributing increases to factors like payroll, insurance, and marketing costs, and noting its percentage of home sales revenues - SG&A expenses increased by **$8.9 million (4%)** for the three months ended July 31, 2025, primarily due to higher payroll, insurance, and marketing costs, partially offset by lower selling commissions[141](index=141&type=chunk) - For the nine months ended July 31, 2025, SG&A increased by **$37.3 million (5%)**, mainly due to higher payroll, marketing, and insurance costs, with SG&A as a percentage of home sales revenues rising to **10.1%** from **9.8%**[142](index=142&type=chunk) [Income from Unconsolidated Entities](index=34&type=section&id=Income%20from%20Unconsolidated%20Entities) This section discusses the changes in income or loss from unconsolidated entities, highlighting the impact of increased earnings from specific joint ventures and rental property sales - The loss from unconsolidated entities decreased from **$10.5 million** in Q3 2024 to **$1.0 million** in Q3 2025, primarily due to increased earnings from a Home Building Joint Venture and a Land Development Joint Venture[143](index=143&type=chunk) - For the nine months ended July 31, 2025, the company recognized income of **$1.7 million** from unconsolidated entities, a significant improvement from a **$13.8 million loss** in the prior year, driven by gains from rental property sales and increased JV earnings, partially offset by higher losses from other JVs[144](index=144&type=chunk) [Other Income – Net](index=34&type=section&id=Other%20Income%20%E2%80%93%20Net) This section analyzes the components of other income, including interest income, ancillary business performance, and non-recurring gains, explaining period-over-period changes Components of Other Income – Net (Amounts in thousands) | Component | Three months ended July 31, 2025 | Three months ended July 31, 2024 | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Interest income | $ 6,955 | $ 9,033 | $ 22,978 | $ 28,508 | | Income from ancillary businesses | 6,548 | 5,405 | 14,737 | 11,152 | | Management fee income | 925 | 985 | 2,696 | 3,291 | | Other | (1,635) | 1,527 | (288) | 6,283 | | **Total other income – net** | **$ 12,793** | **$ 16,950** | **$ 40,123** | **$ 49,234** | - Income from ancillary businesses increased due to higher mortgage operations closing volume and reduced net write-offs in Apartment Living operations, partially offset by decreased management fees from high-rise urban luxury condominium operations[146](index=146&type=chunk) - The decrease in "other" income for the nine-month period was primarily due to the non-recurrence of a **$5.0 million gain** from a privately held company investment and a **$4.4 million gain** from a bulk sale of security monitoring accounts in fiscal 2024[148](index=148&type=chunk)[214](index=214&type=chunk) [Income Before Income Taxes](index=35&type=section&id=Income%20Before%20Income%20Taxes) This section presents the company's income before income taxes for the reported periods, highlighting the percentage change year-over-year Income Before Income Taxes (Amounts in millions) | Period | 2025 | 2024 | % Change | | :----------------------------------- | :------- | :------- | :------- | | Three months ended July 31, | $ 499.5 | $ 503.6 | (1)% | | Nine months ended July 31, | $ 1,200.0 | $ 1,460.0 | (18)% | [Income Tax Provision](index=35&type=section&id=Income%20Tax%20Provision) This section details the income tax provision and effective tax rates for the reported periods, explaining factors influencing rate changes Income Tax Provisions and Effective Rates | Period | Income Tax Provision (millions) | Effective Tax Rate | | :----------------------------------- | :------------------------------ | :----------------- | | Three months ended July 31, 2025 | $ 129.9 | 26.0% | | Three months ended July 31, 2024 | $ 129.0 | 25.6% | | Nine months ended July 31, 2025 | $ 298.6 | 24.9% | | Nine months ended July 31, 2024 | $ 368.8 | 25.2% | - The decrease in the effective tax rate for the nine months ended July 31, 2025, was primarily due to an increase in excess tax benefits related to stock-based compensation[151](index=151&type=chunk) [Contracts](index=35&type=section&id=Contracts) This section analyzes net contracts signed, including value, units, and average contracted price, explaining the impact of demand environment on these metrics Net Contracts Signed (Value in millions, Units) | Metric | Three months ended July 31, 2025 | Three months ended July 31, 2024 | % Change (Value) | % Change (Units) | | :----------------------------------- | :------------------------------- | :------------------------------- | :--------------- | :--------------- | | Net contract value | $ 2,412.0 | $ 2,407.5 | 0.2% | | | Net contracted units | 2,388 | 2,490 | | (4.1)% | | Average contracted price (in '000s) | $ 1,010.1 | $ 966.9 | 4.5% | | Net Contracts Signed (Value in millions, Units) | Metric | Nine months ended July 31, 2025 | Nine months ended July 31, 2024 | % Change (Value) | % Change (Units) | | :----------------------------------- | :------------------------------- | :------------------------------- | :--------------- | :--------------- | | Net contract value | $ 7,323.6 | $ 7,413.3 | (1.2)% | | | Net contracted units | 7,345 | 7,573 | | (3.0)% | | Average contracted price (in '000s) | $ 997.1 | $ 978.9 | 1.9% | | - The decrease in net contracts signed in both periods was primarily due to a softer overall demand environment in fiscal 2025 compared to fiscal 2024[152](index=152&type=chunk)[153](index=153&type=chunk) [Backlog](index=35&type=section&id=Backlog) This section provides a summary of the company's sales backlog, including value, units, and average contracted price, and explains factors influencing changes in backlog units Backlog Summary | Metric | July 31, 2025 | July 31, 2024 | % Change | | :----------------------------------- | :-------------- | :-------------- | :------- | | Backlog value (millions) | $ 6,376.2 | $ 7,066.6 | (10)% | | Backlog units | 5,492 | 6,769 | (19)% | | Average contracted price (in '000s) | $ 1,161.0 | $ 1,044.0 | 11 % | - The decrease in backlog units was primarily due to spec homes representing a larger portion of net signed contracts and deliveries, as these are typically contracted and delivered within a quarter and thus not included in quarter-end backlog[154](index=154&type=chunk) [CAPITAL RESOURCES AND LIQUIDITY](index=35&type=section&id=CAPITAL%20RESOURCES%20AND%20LIQUIDITY) This section discusses the company's funding sources, liquidity position, and expected sufficiency of capital for future operations, debt, share repurchases, and dividends - Funding is primarily from operating activities, credit arrangements, and public capital markets, with sufficient liquidity expected for foreseeable future operations, debt repayment, share repurchases, and dividends[156](index=156&type=chunk)[158](index=158&type=chunk) - At July 31, 2025, the company had **$852.3 million** in cash and cash equivalents and approximately **$2.19 billion** available under its **$2.35 billion** revolving credit facility, which matures on February 7, 2030[159](index=159&type=chunk) - In Q3 2025, the company issued **$500.0 million** of **5.600% Senior Notes** due 2035 and redeemed **$350.0 million** of **4.875% Senior Notes** due November 2025[160](index=160&type=chunk) [Short-term Liquidity and Capital Resources](index=37&type=section&id=Short-term%20Liquidity%20and%20Capital%20Resources) This section identifies the principal short-term demands for funds, such as inventory additions and operating expenses, and outlines how these liquidity needs will be met - Principal short-term demands for funds include inventory additions (land acquisition, development, home construction), operating expenses, capital improvements, investments in joint ventures, debt repayment, stock repurchases, and dividends[161](index=161&type=chunk) - Short-term liquidity will be met primarily through cash on hand and net cash flows from operations, supplemented by joint venture distributions and revolving credit facility capacity[161](index=161&type=chunk) [Long-term Liquidity and Capital Resources](index=37&type=section&id=Long-term%20Liquidity%20and%20Capital%20Resources) This section outlines the company's long-term funding requirements, including debt payments, growth investments, and shareholder returns, and potential sources for additional capital - Long-term demands for funds include principal payments on long-term debt, land purchases and inventory additions for growth, capital investments, joint venture investments, stock repurchases, and dividend payments[163](index=163&type=chunk) - Additional long-term capital may be sourced through public offerings, debt refinancing, or asset disposals if current sources are insufficient[164](index=164&type=chunk) [Material Cash Requirements](index=37&type=section&id=Material%20Cash%20Requirements) This section details significant contractual obligations, including long-term debt, land purchase agreements, operating leases, and commitments to unconsolidated entities - Contractual obligations include long-term debt, mortgage company loan facility payments, land purchase and development agreements, operating leases, and deferred compensation plans[165](index=165&type=chunk) - At July 31, 2025, investments in unconsolidated entities totaled **$1.12 billion**, with commitments to invest an additional **$353.8 million**[166](index=166&type=chunk) - The company had guaranteed debt of unconsolidated entities with loan commitments aggregating **$2.65 billion**, with an estimated maximum exposure of **$574.8 million** for repayment and carry cost guarantees if fully borrowed[168](index=168&type=chunk) [Debt Service Requirements](index=38&type=section&id=Debt%20Service%20Requirements) This section outlines the company's financing strategy, focusing on liquidity and capital market access, and confirms compliance with all financial covenants - The company's financing strategy focuses on liquidity, access to capital markets, balanced debt maturities, and managing floating interest rate volatility[170](index=170&type=chunk) - As of July 31, 2025, the company was in compliance with all financial covenants and requirements on its term loan, revolving credit facility, and other loans payable[171](index=171&type=chunk) [Operating Activities](index=38&type=section&id=Operating%20Activities) This section analyzes cash flows from operating activities, detailing the primary sources and uses of cash, and the overall change in cash and restricted cash - Cash provided by operating activities was **$312.4 million** for the nine months ended July 31, 2025, primarily from net income adjustments and increases in accounts payable/accrued expenses, offset by inventory increases[172](index=172&type=chunk) - Cash, cash equivalents, and restricted cash decreased from **$1.37 billion** at October 31, 2024, to **$938.3 million** at July 31, 2025[172](index=172&type=chunk) [Investing Activities](index=39&type=section&id=Investing%20Activities) This section details cash used in investing activities, primarily for investments in unconsolidated entities and property/equipment purchases, partially offset by returns from JVs - Cash used in investing activities was **$240.2 million** for the nine months ended July 31, 2025, mainly for investments in unconsolidated entities (**$250.4 million**) and property/equipment purchases (**$58.4 million**), partially offset by returns from unconsolidated entities (**$64.9 million**)[175](index=175&type=chunk) [Financing Activities](index=39&type=section&id=Financing%20Activities) This section outlines cash used in financing activities, including stock repurchases, debt redemptions, and loan payments, partially offset by proceeds from new senior notes - Cash used in financing activities was **$504.4 million** for the nine months ended July 31, 2025, primarily for common stock repurchases (**$404.3 million**), senior notes redemption (**$350.0 million**), and loan payments, partially offset by proceeds from new senior notes (**$498.2 million**)[177](index=177&type=chunk) [CRITICAL ACCOUNTING ESTIMATES](index=39&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) This section confirms that there have been no material changes to the company's critical accounting estimates since the last fiscal year-end report - No material changes to critical accounting estimates (inventory, cost of revenue recognition, warranty and self-insurance, investments in unconsolidated entities) since October 31, 2024[179](index=179&type=chunk) [SUPPLEMENTAL GUARANTOR INFORMATION](index=39&type=section&id=SUPPLEMENTAL%20GUARANTOR%20INFORMATION) This section provides summarized financial data for the guarantor subsidiaries, detailing their assets, liabilities, and operating results related to outstanding senior notes - Toll Brothers Finance Corp. (Subsidiary Issuer) has **$1.75 billion** in outstanding senior notes, guaranteed jointly and severally by Toll Brothers, Inc. and its 100%-owned home building subsidiaries (Guarantors)[180](index=180&type=chunk) Summarized Balance Sheet Data (Guarantors, amounts in millions) | Assets | July 31, 2025 | | :----------------------------------- | :-------------- | | Cash | $ 686.5 | | Inventory | $ 10,911.8 | | Amount due from Non-Guarantor Subsidiaries | $ 882.0 | | **Total assets** | **$ 13,225.4** | | Liabilities & Stockholders' Equity | | | Loans payable | $ 933.1 | | Senior notes | $ 1,741.0 | | **Total liabilities** | **$ 5,550.5** | | **Stockholders' equity** | **$ 7,674.9** | Summarized Statement of Operations Data (Guarantors, amounts in millions) | Metric | For the nine months ended July 31, 2025 | | :----------------------------------- | :-------------------------------------- | | Revenues | $ 7,441.0 | | Cost of revenues | $ 5,566.2 | | Selling, general and administrative | $ 746.7 | | Income before income taxes | $ 1,146.0 | | **Net income** | **$ 860.4** | [SEGMENTS](index=41&type=section&id=SEGMENTS) This section provides a detailed analysis of the financial performance of each of the company's geographic operating segments, including revenues, contracts, and income before taxes [North](index=44&type=section&id=North) This segment analysis highlights revenue growth, increased contracts signed, and improved income before taxes, driven by higher deliveries and better product mix - North region home sales revenues increased **17% (QoQ)** and **9% (YoY)** for the three and nine months ended July 31, 2025, respectively, driven by increased spec home deliveries and a higher mix of homes in more expensive areas/products[194](index=194&type=chunk) - Net contracts signed increased **24% (QoQ)** and **3% (YoY) in units**, and **29% (QoQ)** and **6% (YoY) in value**, due to increased demand and more selling communities[195](index=195&type=chunk) - Income before income taxes increased **50% (QoQ)** and **39% (YoY)**, benefiting from higher revenue, lower home sales cost of revenues as a percentage of revenue, and increased income from unconsolidated entities[196](index=196&type=chunk) [Mid-Atlantic](index=45&type=section&id=Mid-Atlantic) This segment analysis shows revenue growth quarter-over-quarter but a year-over-year decline in income before taxes, impacted by a non-recurring land sale gain in the prior year - Mid-Atlantic home sales revenues increased **19% (QoQ)** but decreased **2% (YoY)** for the three and nine months ended July 31, 2025, respectively, with average delivered price decreasing **8% YoY** due to a shift to less expensive areas[197](index=197&type=chunk)[198](index=198&type=chunk) - Net contracts signed increased **9% (QoQ)** and **18% (YoY) in units**, mainly due to an increase in the average number of selling communities[199](index=199&type=chunk) - Income before income taxes decreased **3% (QoQ)** and **55% (YoY)**, with the nine-month decline primarily due to a non-recurring **$175.2 million pre-tax gain** from a land sale in fiscal 2024[200](index=200&type=chunk)[201](index=201&type=chunk) [South](index=46&type=section&id=South) This segment analysis indicates a slight revenue decrease quarter-over-quarter but overall growth year-over-year, with income before taxes impacted by product mix and higher impairment charges - South region home sales revenues decreased **2% (QoQ)** but increased **3% (YoY)** for the three and nine months ended July 31, 2025, respectively, with deliveries flat QoQ and up **4% YoY** due to higher backlog conversion and spec home deliveries[202](index=202&type=chunk)[203](index=203&type=chunk) - Net contracts signed decreased **14% (QoQ)** and **5% (YoY) in units**, primarily due to softer demand and fewer selling communities[204](index=204&type=chunk) - Income before income taxes decreased **9% (QoQ)** but increased **4% (YoY)**, with the QoQ decline attributed to lower revenues and higher home sales cost of revenues (due to product mix shift and increased impairment charges of **$8.5 million** vs. **$2.3 million**)[205](index=205&type=chunk)[206](index=206&type=chunk) [Mountain](index=47&type=section&id=Mountain) This segment analysis shows strong revenue and income growth, driven by increased deliveries, backlog conversion, and lower inventory impairment charges - Mountain region home sales revenues increased **9% (QoQ)** and **18% (YoY)** for the three and nine months ended July 31, 2025, respectively, driven by higher backlog conversion, increased spec home deliveries, and a larger backlog[207](index=207&type=chunk) - Net contracts signed decreased **9% (QoQ)** and **7% (YoY) in units**, primarily due to softer demand and fewer selling communities[208](index=208&type=chunk) - Income before income taxes increased **21% (QoQ)** and **29% (YoY)**, mainly due to higher revenues and lower home sales cost of revenues as a percentage of revenue, with the nine-month period benefiting from lower inventory impairment charges (**$15.3 million** vs. **$25.7 million**)[209](index=209&type=chunk) [Pacific](index=48&type=section&id=Pacific) This segment analysis indicates revenue and income declines due to lower backlog and a shift to lower-margin areas, despite an increase in average contracted price - Pacific region home sales revenues decreased **2% (QoQ)** and **19% (YoY)** for the three and nine months ended July 31, 2025, respectively, due to lower backlog and backlog conversion, though Q3 saw a slight increase in deliveries from spec homes[210](index=210&type=chunk) - Net contracts signed decreased **12% (QoQ)** and **15% (YoY) in units** due to softer demand, but average contracted price increased **30% (QoQ)** and **13% (YoY)** due to a shift to more expensive areas/products[211](index=211&type=chunk) - Income before income taxes decreased **27% (QoQ)** and **44% (YoY)**, mainly due to lower revenues and higher home sales cost of revenues as a percentage of revenue, driven by a shift to lower-margin areas and increased inventory impairment charges (**$5.4 million** vs. **$0.1 million QoQ**, **$7.0 million** vs. **$0.1 million YoY**)[212](index=212&type=chunk) [Corporate and Other](index=48&type=section&id=Corporate%20and%20Other) This section explains the increased loss before income taxes, attributing it to higher SG&A, increased losses from unconsolidated entities, and the non-recurrence of prior-year gains - Loss before income taxes increased to **$59.6 million (QoQ)** and **$167.5 million (YoY)** for the three and nine months ended July 31, 2025, respectively[213](index=213&type=chunk)[214](index=214&type=chunk) - The increase in loss was primarily due to higher SG&A costs, higher losses from unconsolidated entities (lower gains from rental property sales YoY), and lower interest income[213](index=213&type=chunk)[214](index=214&type=chunk) - Fiscal 2024 benefited from non-recurring gains, including a **$5.0 million gain** from a privately held company investment and a **$4.4 million gain** from a bulk sale of security monitoring accounts, which did not recur in fiscal 2025[214](index=214&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=50&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the company's exposure to market risks, primarily interest rate fluctuations, and how it manages these risks through a mix of fixed-rate and variable-rate debt and interest rate swap transactions - The company is exposed to market risk primarily from fluctuations in interest rates, utilizing both fixed-rate and variable-rate debt[217](index=217&type=chunk) - For variable-rate debt, a **1% increase in interest rates** would increase annual interest incurred by approximately **$9.1 million**, without considering interest rate swaps[218](index=218&type=chunk) - The company uses interest rate swap transactions to hedge **$400.0 million** of its **$650.0 million Term Loan Facility**, effectively fixing the interest cost on that portion[219](index=219&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures and states that there have been no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective as of July 31, 2025, providing reasonable assurance that required information is recorded, processed, summarized, and reported timely[221](index=221&type=chunk) - No material changes in internal control over financial reporting occurred during the quarter ended July 31, 2025[222](index=222&type=chunk) [PART II. Other Information](index=52&type=section&id=PART%20II.%20Other%20Information) [Item 1. Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20Proceedings) This section states that the company is involved in various claims and litigation in the ordinary course of business, but believes adequate provisions have been made and that these matters will not materially adversely affect its financial condition or results of operations - The company is involved in various claims and litigation in the ordinary course of business[225](index=225&type=chunk) - Management believes adequate provision has been made for current claims and litigation, and their disposition will not materially adversely affect results of operations, liquidity, or financial condition[225](index=225&type=chunk) [Item 1A. Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20Factors) This section indicates that there have been no material changes to the risk factors previously disclosed in the company's most recent Annual Report on Form 10-K - No material changes in risk factors have occurred since the disclosure in the 2024 Form 10-K[226](index=226&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's share repurchase activities during the quarter and information regarding dividend payments, noting that contractual limitations did not significantly restrict dividend payments Issuer Purchases of Equity Securities (Three months ended July 31, 2025) | Period | Total number of shares purchased (thousands) | Average price paid per share | Maximum number of shares that may yet be purchased (thousands) | | :-------------------------- | :----------------------------------- | :--------------------------- | :------------------------------------------------------------- | | May 1, 2025 to May 31, 2025 | 288 | $ 104.53 | 12,967 | | June 1, 2025 to June 30, 2025 | 915 | $ 109.32 | 12,052 | | July 1, 2025 to July 31, 2025 | 588 | $ 117.70 | 11,464 | | **Total** | **1,791** | | | - The Board of Directors authorized the repurchase of **20 million shares** of common stock on December 13, 2023, with no expiration date[229](index=229&type=chunk) - Cash dividends of **$0.73 per share** were paid during the nine months ended July 31, 2025, and contractual limitations on dividends did not meaningfully restrict payments[230](index=230&type=chunk) [Item 5. Other Information](index=53&type=section&id=Item%205.%20Other%20Information) This section confirms that no director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the reporting period - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the period[231](index=231&type=chunk) [Item 6. Exhibits](index=53&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including supplemental indentures, authorizing resolutions, certifications, and XBRL financial statements - Exhibits include the Thirty-Seventh Supplemental Indenture, Authorizing Resolution for Senior Notes, Section 302 and 906 certifications, and iXBRL formatted financial statements[232](index=232&type=chunk) [SIGNATURES](index=54&type=section&id=SIGNATURES) This section confirms the official signing of the report by the company's Senior Vice President and Chief Financial Officer and Senior Vice President and Chief Accounting Officer - The report is duly signed on behalf of Toll Brothers, Inc. by Martin P. Connor (Senior Vice President and Chief Financial Officer) and Michael J. Grubb (Senior Vice President and Chief Accounting Officer) on August 28, 2025[235](index=235&type=chunk)

Core Insights - Toll Brothers, Inc. has announced the grand opening of the Rosalynn Contemporary model home at the Jason's Walk community in Cumming, Georgia, showcasing luxury home designs and craftsmanship [1][2] Company Overview - Toll Brothers, Inc. is recognized as the nation's leading builder of luxury homes, founded in 1967 and publicly traded since 1986 under the NYSE symbol "TOL" [9] - The company operates in over 60 markets across 24 states and the District of Columbia, offering a range of housing options for various buyer demographics [9] Community Features - Jason's Walk community features luxurious single-family homes ranging from approximately 3,300 to 3,900 square feet, with prices starting from the upper $800,000s [4] - Each home includes 5 bedrooms, 3.5 to 5.5 bathrooms, and a 3-car garage, designed with high-end fixtures and finishes [4] Location Advantages - The community is conveniently located near Georgia State Route 400, providing easy access to outdoor recreation, shopping, dining, and employment hubs [4] - Residents are assigned to the highly rated Forsyth County School District, which includes Poole's Mill Elementary, Liberty Middle, and West Forsyth High [5] Customer Experience - Toll Brothers offers a state-of-the-art Design Studio for customers to personalize their homes with a wide array of selections, assisted by professional Design Consultants [6] - Quick move-in homes with Designer Appointed Features are available, allowing buyers to move in by late summer or early fall [6]

Core Insights - Toll Brothers, Inc. announced the final opportunity to purchase luxury townhomes at Hilltop in Reno, Nevada, emphasizing the quick move-in availability and designer features [1][2] Company Overview - Toll Brothers is the leading builder of luxury homes in the United States, founded in 1967 and publicly traded since 1986 [6] - The company operates in over 60 markets across 24 states and the District of Columbia, offering a range of housing options for various buyer segments [7] Product Offering - The Hilltop townhomes feature three stories, finished basements, covered patios, and decks, with sizes ranging from 2,636 to over 3,010 square feet [2] - Remaining homes include 3 bedrooms, 2 to 3 full baths, 2 half baths, and 2-car garages, priced from the mid-$700,000s [2] Community and Lifestyle - Hilltop is positioned as a community that offers a blend of luxury living, convenience, and a lock-and-leave lifestyle, appealing to both full-time residents and second-home owners [4] - The location provides scenic views, access to walking trails, and proximity to dining, shopping, and entertainment options [4] Sales and Market Position - Only a few move-in ready homes remain, indicating strong demand and a competitive market [5] - The Sales Center is located at 1545 Golf Club Drive in Reno, with private tours encouraged for interested buyers [5]

Core Insights - Toll Brothers, Inc. has launched a new luxury home community named 3131 Camino in Santa Clara, California, featuring modern townhome- and villa-style condos [1][2] Group 1: Community Features - 3131 Camino offers a variety of home designs with open floor plans, including 2 to 3 bedrooms and 2 to 3 bathrooms, along with private one- to two-car garages and rooftop terraces on select homes [2] - The community is strategically located near shopping, dining, public transportation, and outdoor recreation, providing easy access to Silicon Valley's top employers and the San Francisco Bay Area [5] Group 2: Pricing and Sales Information - Homes in the 3131 Camino community are priced from $1.369 million to over $1.6 million [6] - The offsite Sales Center is located at 3084 El Camino Real in Santa Clara, and potential buyers can contact the company for more information [1][6] Group 3: Company Background - Toll Brothers, Inc. is recognized as the nation's leading builder of luxury homes and operates in over 60 markets across 24 states [8] - The company has received multiple accolades, including being named one of Fortune magazine's World's Most Admired Companies for over 10 years [9]

Core Viewpoint - Toll Brothers has experienced a significant stock rebound, driven by a strong performance in the luxury housing market and a less interest-sensitive affluent customer base [1][2]. Financial Performance - Toll Brothers reported record Q3 sales of $2.94 billion, surpassing estimates of $2.85 billion, and reflecting an 8% increase from $2.72 billion a year ago [4]. - Q3 earnings per share (EPS) were $3.73, up from $3.60 in the same quarter last year, exceeding expectations of $3.59 by nearly 4% [4]. - The company delivered 2,959 homes at an average price of $974,000, achieving an adjusted gross margin of 27.5% [6]. Market Position and Strategy - Despite a softer overall housing market, Toll Brothers attributes its strong results to a balanced operating model and a diversified luxury business strategy that prioritizes price and margin over sales pace [5]. - The company signed 2,388 net contracts worth $2.4 billion during Q3, resulting in a total backlog of 5,492 homes valued at $6.37 billion, with an average sales price of $1.16 million [7]. Guidance and Future Outlook - Toll Brothers expects to deliver approximately 11,200 homes for the full year, at the lower end of its previous guidance range [7]. - The company maintained its full-year adjusted gross margin forecast at 27.25% and expects other income from unconsolidated entities and land sales gross profit of $110 million [8]. Valuation Metrics - TOL shares trade at 9.4X forward earnings, which is below the Zacks Building Products-Home Builders Industry average of 12.4X, indicating a potential investment opportunity [9]. - The stock is also trading well under the preferred level of less than 2X sales [9]. Dividend Information - Toll Brothers has increased its dividend for five consecutive years, with an annualized growth rate of 16.31% [11]. - The current annual yield is 0.76%, which is below the S&P 500 average of 1.16%, but the 7% payout ratio suggests room for future increases [11]. Overall Assessment - Toll Brothers appears well-positioned to navigate the housing market slowdown due to its luxury clientele, although it faces challenges in a tougher operating environment [12].

Core Insights - Toll Brothers, Inc. is launching model homes at Manzanita Park in Morgan Hill, California, with a grand opening event scheduled for August 23, 2025 [1][2] Company Overview - Toll Brothers is recognized as the nation's leading builder of luxury homes, founded in 1967 and publicly traded since 1986 [9] - The company operates in over 60 markets across 24 states and the District of Columbia, offering a range of housing options for various buyer segments [9] Product Offering - Manzanita Park features townhome-style condos ranging from 1,348 to over 2,425 square feet, with configurations of 2 to 4 bedrooms and 2.5 to 3.5 bathrooms [4] - Homes are priced starting from the low $900,000s, with high-end finishes and personalization options available [4] Community Amenities - Residents will have access to amenities such as pickleball courts, a community tot lot, a private dog park, and a centralized resident congregation area [5] - The community is located in a scenic area of the Santa Clara Valley, close to downtown Morgan Hill, which offers shops, restaurants, and community events [5][6] Customer Experience - Toll Brothers provides a state-of-the-art Design Studio for customers to personalize their homes with the help of professional Design Consultants [7]

Core Insights - Toll Brothers, Inc. has announced the grand opening of model homes at Manzanita Park, a new luxury townhome-style condo community in Morgan Hill, California, scheduled for August 23, 2025 [1][2] Company Overview - Toll Brothers is recognized as the nation's leading builder of luxury homes, founded in 1967 and publicly traded since 1986 [9] - The company operates in over 60 markets across 24 states and the District of Columbia, offering a diverse range of housing options for various buyer segments [9] Product Offering - Manzanita Park features townhome-style condos ranging from 1,348 to over 2,425 square feet, with configurations of 2 to 4 bedrooms and 2.5 to 3.5 bathrooms, priced from the low $900,000s [4] - The community includes high-end finishes and personalization options available at the Toll Brothers Design Studio [4][7] Community Amenities - Residents will have access to amenities such as pickleball courts, a community tot lot, a private dog park, and a centralized resident congregation area [5] - The location offers scenic views and proximity to downtown Morgan Hill, which features unique shops, restaurants, and community events [5][6] Strategic Positioning - The community's location near Silicon Valley provides residents with access to employment and educational hubs, as well as vibrant nightlife and dining experiences [6]

Core Insights - Toll Brothers, Inc. is launching three new luxury home collections in the Eldorado neighborhood of Santa Rita Ranch, Liberty Hill, Texas, with sales starting in fall 2025 [1][5] Group 1: Home Collections - The Maravilla Collection features homes ranging from 2,238 to 3,116 square feet on 50-foot-wide sites, with starting prices from the low $600,000s [2] - The Sierra Collection offers homes from 2,857 to 3,899 square feet on 60-foot-wide sites, starting from the low $700,000s [2] - The Tesoro Collection includes homes ranging from 3,292 to 4,700 square feet on 70-foot-wide sites, with starting prices anticipated from the low $800,000s [2] Group 2: Customer Experience - Toll Brothers provides a one-stop shopping experience at the Toll Brothers Design Studio, allowing customers to personalize their homes with professional design consultants [3] Group 3: Community Amenities - Santa Rita Ranch features luxury amenities such as six resort-style pools, water slides, splash pads, playgrounds, pickleball courts, a fitness center, and extensive parks and nature trails [5] - The community has received multiple awards, including Best of the Best Amenities in the Austin Area and Community of the Year awards from various organizations [5] Group 4: Company Overview - Toll Brothers, Inc. is a Fortune 500 Company and the leading builder of luxury homes in the United States, operating in over 60 markets across 24 states [8] - The company has been recognized as one of Fortune magazine's World's Most Admired Companies for over 10 years and has received multiple accolades for its leadership and performance in the industry [9]

Core Insights - Toll Brothers, Inc. has opened new model homes at Willow Glen in Forsyth County, Georgia, featuring luxury single-family homes with access to high-end amenities [1][4] - The community offers two-story homes with 5 bedrooms and 3.5 to 5.5 bathrooms, ranging from 3,297 to over 4,674 square feet, priced from the upper $700,000s [4][6] - The Toll Brothers Design Studio provides a personalized shopping experience for homebuyers, allowing them to customize their homes with professional design consultants [5] Company Overview - Toll Brothers is a leading builder of luxury homes in the United States, founded in 1967 and publicly traded since 1986 [8] - The company operates in over 60 markets across 24 states and the District of Columbia, offering a variety of housing options for different buyer segments [8] - Toll Brothers has received multiple accolades, including being named one of Fortune magazine's World's Most Admired Companies for over 10 years [9]

Core Viewpoint - Toll Brothers is considered a strong buy-and-hold stock due to its operational quality, cash flow, capital return, and long-term supply-demand outlook, but faces risks in 2025 due to macroeconomic conditions impacting the housing market [1] Group 1: Financial Performance - The company reported a strong FQ3 with robust profitability and ample capital returns, but guidance for deliveries fell short, indicating potential changes in Q4 and early Q1 [2][7] - The capital return is deemed safe in 2025, with cash flow sufficient to cover dividend payments while maintaining financial health, despite increased liabilities [9] - The annual dividend is $1.00, with a dividend yield of 0.76% and a payout ratio of 7.42% [9] Group 2: Market Conditions - The market reaction suggests it may be peaking, with stock price declining nearly 3.0% in pre-opening trading, indicating resistance at critical levels around the low-$130s [2] - Leading indicators show weakness, including a 4% decline in signed contracts, a 10% decline in backlog, and a 19% contraction in backlog value [8] - The Federal Open Market Committee (FOMC) is unlikely to make aggressive interest rate cuts to spur housing demand, with only an 82% chance for a 25-basis point cut at the September meeting [5][7] Group 3: Stock Performance and Analyst Sentiment - Analysts maintain a Moderate Buy rating with a 65% bullish bias, but price target uptrend has stalled, suggesting potential downward pressure on stock action [11] - Stock repurchases reduced the count by an average of 4.6% for the quarter, although the pace may slow in the future [10] - Toll Brothers was not included in a list of top stocks recommended by leading analysts, indicating a preference for other investment opportunities [12]