Toll Brothers Reports FY 2025 Fourth Quarter Results

Core Insights - Toll Brothers, Inc. reported strong financial results for FY 2025, achieving record home sales revenues of $10.8 billion and delivering 11,292 homes at an average price of $960,000, despite a challenging market environment [4][9][11]. Financial Highlights for Q4 FY 2025 - In Q4 FY 2025, the company generated $3.4 billion in home sales revenue, with an adjusted gross margin of 27.1% and an SG&A margin of 8.3% [4][9]. - Net income for Q4 FY 2025 was $446.7 million, or $4.58 per diluted share, compared to $475.4 million, or $4.63 per diluted share in Q4 FY 2024 [9][10]. - The number of homes delivered in Q4 FY 2025 was 3,443, slightly up from 3,431 in Q4 FY 2024 [9][10]. Full Year Financial Highlights FY 2025 - For the full fiscal year 2025, net income was $1.35 billion, or $13.49 per diluted share, down from $1.57 billion, or $15.01 per diluted share in FY 2024 [9][11]. - Home sales revenues increased to $10.84 billion from $10.56 billion in FY 2024, with a total of 11,292 homes delivered [9][11]. - The adjusted home sales gross margin for FY 2025 was 27.3%, compared to 28.4% in FY 2024 [11]. Operational Metrics - The company maintained a backlog value of $5.5 billion at the end of Q4 FY 2025, down from $6.5 billion at the end of Q4 FY 2024, with homes in backlog decreasing to 4,647 from 5,996 [9][10]. - The net signed contract value for Q4 FY 2025 was $2.53 billion, compared to $2.66 billion in Q4 FY 2024 [9][10]. Guidance for FY 2026 - For Q1 FY 2026, Toll Brothers expects to deliver between 1,800 and 1,900 units, with an average delivered price per home between $985,000 and $995,000 [7]. - The company anticipates a full fiscal year delivery range of 10,300 to 10,700 units, with an adjusted home sales gross margin of 26.00% [7]. Strategic Focus - The company is focused on disciplined operations and capital efficiency, with plans for community count growth of 8% to 10% in FY 2026 [5][6]. - Toll Brothers emphasizes its luxury market positioning, which is less affected by affordability pressures, and aims to balance price and pace in response to local demand conditions [5][6].