Hovnanian Enterprises Reports Fiscal 2026 First Quarter Results

Core Insights - Hovnanian Enterprises, Inc. reported a 5% year-over-year increase in domestic consolidated communities and met or exceeded all guidance metrics for the fiscal first quarter ended January 31, 2026 [1][9] Financial Performance - Total revenues for the first quarter of fiscal 2026 were $632.0 million, down from $673.6 million in the same quarter of the previous year [2] - Homebuilding gross margin percentage after cost of sales interest expense and land charges was 10.1%, compared to 15.2% in the first quarter of the prior year [2] - Net income was $20.9 million, or $2.62 per diluted common share, compared to $28.2 million, or $3.58 per diluted common share, in the same period last year [2] - Adjusted EBITDA for the quarter was $63.1 million, exceeding the high end of the guidance range, compared to $72.1 million in the first quarter of the prior fiscal year [2][10] Sales and Contracts - Consolidated domestic contracts increased 3.1% to 1,242 homes valued at $664.8 million compared to 1,205 homes valued at $643.3 million in the same quarter last year [2] - The gross domestic contract cancellation rate for consolidated contracts was 14%, down from 16% in the fiscal 2025 first quarter [3] Liquidity and Inventory - Total liquidity as of January 31, 2026, was $471.4 million, significantly above the target liquidity range of $170 million to $245 million [10][20] - Total domestic controlled consolidated lots were 35,560, down from 43,254 lots at the end of the previous fiscal year's first quarter [10] Guidance and Outlook - For the second quarter of fiscal 2026, total revenues are expected to be between $625 million and $725 million, with adjusted homebuilding gross margin anticipated between 13.0% and 14.0% [7] - The company anticipates an increase in adjusted income before income taxes in the second half of fiscal 2026, supported by better contract activity observed in January and February [11]