Lennar Reports First Quarter 2025 Results

Financial Performance - Lennar Corporation reported first quarter net earnings of $520 million, or$1.96 per diluted share, down from $719 million, or$2.57 per diluted share in the prior year [2][3] - Excluding mark-to-market losses on technology investments, net earnings were $567 million, or$2.14 per diluted share, compared to $723 million, or$2.58 per diluted share in the previous year [2][3] - Total revenues increased to $7.6 billion, up from$7.3 billion in the prior year, driven by a 6% increase in home deliveries [4][7] Homebuilding Operations - The company delivered 17,834 homes in the first quarter, exceeding guidance, and recorded new orders of 18,355 homes, also above guidance [3][4] - The average sales price of homes delivered decreased by 1% to $408,000 compared to the previous year [4][7] - Gross margin on home sales was 18.7%, slightly below guidance, with SG&A expenses at 8.5%, resulting in a net margin of 10.2% [4][9] Strategic Initiatives - Lennar completed the spin-off of Millrose Properties, Inc., distributing approximately 80% of Millrose's stock to shareholders, which aligns with its asset-light strategy [5][14] - The acquisition of Rausch Coleman Homes expanded Lennar's market presence into new regions while maintaining an asset-light approach [5][15] - The company reported a significant improvement in its controlled homesite percentage to 98%, the highest in its history, and reduced its years supply of owned homesites to 0.2 years [5][6] Market Conditions - The homebuilding sector faced challenges due to high interest rates, inflation, and a downturn in consumer confidence, impacting affordability and access to homeownership [3][4] - The company utilized incentives, such as interest rate buydowns, to manage inventory and stimulate sales in a constrained market [4][5] Future Guidance - For the second quarter of 2025, Lennar expects to deliver between 19,500 to 20,500 homes, with an anticipated gross margin of approximately 18% [5][17] - New orders are projected to be between 22,500 to 23,500 homes, reflecting a cautious outlook amid ongoing market challenges [5][17]