KB Home(KBH) ZACKS·2025-03-25 17:35Core Viewpoint - KB Home (KBH) reported disappointing fiscal first-quarter 2025 results, with earnings and total revenues missing estimates and declining year over year [1][4] Financial Performance - Adjusted earnings per share (EPS) were $1.49, missing the Zacks Consensus Estimate of $1.56 by 4.5%, and down from $1.76 in the prior year [4] - Total revenues were $1.392 billion, missing the consensus mark of $1.503 billion by 7.4% and down 5.2% year over year [4] Segment Analysis - Homebuilding segment revenues were $1.387 billion, a decline of 5.1% from $1.462 billion in the prior year, with homes delivered decreasing by 9% to 2,770 units [5] - The average selling price (ASP) increased by 4.3% year over year to $500,700 [5] - Net orders fell 17% year over year to 2,772 units, with the value of net orders decreasing to $1.346 billion from $1.582 billion [6] Market Conditions - The results reflect a soft housing market, with homebuyers facing affordability issues due to high mortgage rates and ongoing macroeconomic uncertainties [2] - The company lowered its fiscal 2025 guidance due to these market uncertainties and a lower net orders level [2][12] Financial Position - As of February 28, 2025, KB Home had cash and cash equivalents of $267.8 million, down from $598 million at the end of fiscal 2024 [10] - The debt-to-capital ratio increased to 30.5% from 29.4% at the end of fiscal 2024 [10] Guidance Adjustments - For fiscal 2025, housing revenues are now expected to be in the range of $6.60-$7 billion, down from $7-$7.50 billion [12] - The expected housing gross margin is now between 19.2% and 20%, down from the previous range of 20-21% [13]