Core Viewpoint - United Homes Group, Inc. (UHG) reported a significant decline in earnings for the third quarter of 2025, with a net loss widening to $31.3 million, reflecting challenges in home closings and increased non-cash losses from derivative liabilities [2][12] Financial Performance - Revenue for Q3 2025 fell 23.5% year-over-year to $90.8 million from $118.6 million, primarily due to a 28.9% decline in home closings [2][4] - The net loss for the quarter was $31.3 million, or $0.53 per diluted share, compared to a loss of $7.3 million, or $0.15 per diluted share, in Q3 2024 [2] - Gross margin contracted to 17.7% from 18.9%, while adjusted gross margin slipped to 19.6% from 20.6% [3][5] - Adjusted EBITDA for the quarter decreased 57.5% to $3.8 million from $8.9 million, with the adjusted EBITDA margin contracting to 4.2% from 7.6% [6] Operational Metrics - For the first nine months of 2025, revenue declined 13.9% to $283.3 million, and home closings dropped 19.7% to 817 [4] - Net new orders eased 4.9% to 324 from 341 a year earlier, although the average sales price of production-built homes rose about 8.1% to $346,000 [3][5] - The company reported a backlog of 264 homes valued at approximately $94.3 million, indicating a 20% increase in backlog value year-over-year [7] Market Conditions - Closings dropped broadly across key markets, with a 45.6% decline in the Midlands region and a 22.2% decline in the Raleigh region [8][11] - Management attributed the quarter's performance to affordability challenges and a choppy housing market, but noted sequential improvement in September [9][13] Strategic Developments - United Homes concluded a review of strategic alternatives, deciding to continue as an independent public company, which led to several director resignations [14] - The company is focusing on operational efficiencies, cost savings, and maintaining a disciplined approach to pricing and incentives [10][13]
United Homes Stock Plunges Following Q3 Earnings and Soft Demand