KB Home Shares Drop 8% After Weak 2026 Outlook Overshadows Earnings Beat

Core Viewpoint - KB Home's shares dropped over 8% intra-day due to a cautious outlook for 2026, despite exceeding fourth-quarter earnings expectations [1] Financial Performance - The company reported adjusted earnings of $1.92 per share for the quarter ending November 30, 2025, surpassing analyst estimates of $1.79 [1] - Revenue for the quarter was $1.69 billion, slightly above the consensus forecast of $1.66 billion, but down 15.5% from $2.00 billion in the same quarter last year [1] Housing Deliveries and Pricing - Housing deliveries decreased by 9% to 3,619 homes, while the average selling price fell by 7% year over year to $465,600 [2] - The homebuilding operating income margin, excluding inventory-related charges, contracted to 7.8%, down from 11.5% in the prior-year period [2] Future Guidance - The company's fiscal 2026 guidance projected full-year housing revenue between $5.10 billion and $6.10 billion, indicating a potential decline from fiscal 2025 revenue of $6.21 billion [3] - For the first quarter, KB Home forecasted deliveries of 2,300 to 2,500 homes and housing revenue of $1.05 billion to $1.15 billion [3] Backlog Status - The company reported a quarter-end backlog of 3,128 homes valued at $1.40 billion, down from 4,434 homes valued at $2.24 billion a year earlier, highlighting ongoing challenges in the housing market [4]