Core Viewpoint - NVR's third-quarter 2025 earnings report shows a mixed performance with earnings and homebuilding revenues exceeding estimates, but both metrics declined year-over-year, reflecting ongoing challenges in the housing market [2][3][5]. Financial Performance - NVR reported earnings of $112.33 per share, surpassing the Zacks Consensus Estimate of $107.88 by 4.1%, but down 14% from $130.50 in the prior-year quarter [5]. - Homebuilding revenues reached $2.56 billion, exceeding the consensus mark of $2.41 billion by 6.3%, yet declined 4.4% year-over-year [6]. - Consolidated revenues, including Homebuilding and Mortgage Banking fees, totaled $2.61 billion, a slight decrease of 4.5% year-over-year [6]. Segment Analysis - Homebuilding segment revenues fell 4.4% year-over-year to $2.56 billion, with settlements down 5% to 5,639 units [7]. - The average selling price (ASP) for settlements remained stable at $454,000, slightly below the estimated $460,000 [7]. - New orders decreased 16% year-over-year to 4,735 units, while the ASP for new orders increased by 3% to $464,800 [9]. Market Conditions - The housing market continues to show softness, with affordability challenges and inflationary pressures impacting demand [3]. - Backlog units decreased 19% year-over-year to 9,165 homes, reflecting ongoing caution among homebuyers [9]. Cost and Margin Analysis - Gross margin contracted by 240 basis points year-over-year to 21%, primarily due to higher lot costs and pricing pressures [8]. - Contract land deposit impairments totaled approximately $18.9 million, contributing to the decline in profitability [8]. Mortgage Banking Performance - Mortgage banking fees fell 11.1% year-over-year to $49.2 million, with closed loan production down 7% to $1.54 billion [10]. - The capture rate remained stable at 86%, consistent with the previous year [10]. Shareholder Actions - NVR repurchased 178,178 shares for $1.33 billion during the first nine months of 2025, with 2,860,899 shares outstanding as of September 30, 2025 [12]. Outlook and Estimates - Following the earnings release, there has been a downward trend in estimates for NVR, indicating cautious sentiment among analysts [13]. - NVR currently holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the coming months [15].

Financial Performance - Homebuilding revenues for the three months ended September 30, 2025, were $2,560,343 thousand, a decrease of 4.4% compared to $2,677,640 thousand for the same period in 2024[15]. - Net income for the nine months ended September 30, 2025, was $976,001 thousand, down 20.2% from $1,224,496 thousand for the same period in 2024[18]. - Basic earnings per share for the three months ended September 30, 2025, were $119.26, a decrease of 14.6% compared to $139.65 for the same period in 2024[15]. - Total consolidated revenues for Q3 2025 were $2,609,505, a decrease of 4.5% compared to $2,732,951 in Q3 2024[58]. - Total segment profit for Q3 2025 was $386,614, a decrease of 20.0% from $483,008 in Q3 2024[61]. - The company reported a net income of $429,323 for the three months ended September 30, 2024, contributing to a total net income of $1,224,496 for the nine months ended September 30, 2024[48]. Assets and Liabilities - Total assets decreased from $6,380,988 thousand as of December 31, 2024, to $6,035,458 thousand as of September 30, 2025, representing a decline of approximately 5.4%[9]. - Total liabilities decreased from $2,170,916 thousand as of December 31, 2024, to $2,068,696 thousand as of September 30, 2025, a reduction of about 4.7%[12]. - Cash and cash equivalents at the end of the period decreased to $2,023,604 thousand from $2,568,667 thousand, a decline of approximately 21.4%[18]. - The carrying value of land under development as of September 30, 2025, was $38,017, down from $65,394 as of December 31, 2024[39]. - Total segment assets increased to $3,788,694 as of September 30, 2025, compared to $3,502,540 as of December 31, 2024, reflecting a growth of 8.2%[64]. Customer and Deposits - The company reported a decrease in customer deposits from $322,926 thousand as of December 31, 2024, to $277,351 thousand as of September 30, 2025, a decline of approximately 14.1%[12]. - The total risk of loss related to contract land deposits as of September 30, 2025, was approximately $872,323, up from $735,397 as of December 31, 2024[30]. - The allowance for losses on contract land deposits was $85.4 million as of September 30, 2025, compared to $58.6 million as of December 31, 2024[30]. Cash Flow and Operating Activities - The company’s cash flows from operating activities for the nine months ended September 30, 2025, were $681,592 thousand, a decrease of 7.6% from $737,412 thousand for the same period in 2024[18]. - The company incurred interest expense of $20,721 thousand for the nine months ended September 30, 2025, compared to $20,214 thousand for the same period in 2024, reflecting a slight increase of 2.5%[15]. - The company reported a net cash provided by operating activities of $681,592 thousand for the nine months ended September 30, 2025, compared to $737,412 thousand for the same period in 2024, a decrease of 7.6%[18]. Shareholder Equity and Stock Activity - Shareholders' equity increased to $3,966,762 thousand as of September 30, 2025, up from $3,845,131 thousand at June 30, 2025, reflecting a net income of $342,688 thousand during the quarter[46]. - The company repurchased 35,224 shares of common stock during the three months ended September 30, 2025, and 178,178 shares during the nine months ended September 30, 2025[46]. - The weighted average number of shares outstanding used to calculate basic earnings per share (EPS) for the three months ended September 30, 2025, was 2,873,501, down from 3,074,230 in 2024[43]. Mortgage Banking - Mortgage banking income for the nine months ended September 30, 2025, was $94,855 thousand, down 12.9% from $108,991 thousand for the same period in 2024[15]. - Mortgage banking income for the three months ended September 30, 2025, was $32,719 thousand, a decrease of 6.4% from $34,945 thousand in the same period of 2024[15]. - The company’s mortgage banking segment profit consists of revenues generated from mortgage financing, title insurance, and closing services, with no corporate capital allocation charge applied[55]. Impairment and Reserves - For the three months ended September 30, 2025, the company incurred pre-tax impairment charges on lot deposits of approximately $18,900, compared to $3,900 for the same period in 2024[28]. - Warranty Reserve decreased to $124,851 thousand at the end of September 2025 from $127,440 thousand at the beginning of the period, with provisions of $20,989 thousand and payments of $23,578 thousand during the quarter[51]. Tax and Lease Expenses - The effective tax rate for the three months ended September 30, 2025, was 22.8%, up from 20.3% in the same period of 2024[91]. - Operating lease expense for the three months ended September 30, 2025, was $10,835, compared to $10,078 for the same period in 2024[89]. - Cash paid for operating leases in the nine months ended September 30, 2025, was $24,659, compared to $23,466 in 2024[89]. Credit Facilities and Commitments - Senior Notes outstanding as of September 30, 2025, totaled $900,000, maturing on May 15, 2030, with an interest rate of 3.00%[77]. - The Amended Credit Agreement provides for a $300,000 senior unsecured revolving credit facility, maturing on March 11, 2030[81]. - Contractual commitments to extend credit to borrowers totaled $1,714,602 as of September 30, 2025[70].

Core Insights - NVR, Inc. reported third-quarter 2025 results with earnings and Homebuilding revenues exceeding the Zacks Consensus Estimate, although both metrics showed a year-over-year decline [1][4][5] Financial Performance - Earnings per share were $112.33, surpassing the consensus estimate of $107.88 by 4.1%, but down 14% from $130.50 in the prior-year quarter [4] - Homebuilding revenues reached $2.56 billion, exceeding the consensus mark of $2.41 billion by 6.3%, yet declined 4.4% year over year [5] - Consolidated revenues, combining Homebuilding and Mortgage Banking fees, totaled $2.61 billion, a slight decrease of 4.5% year over year [5] Homebuilding Segment Analysis - Homebuilding segment revenues fell 4.4% year over year to $2.56 billion, with settlements down 5% to 5,639 units [6] - The average selling price (ASP) for settlements remained stable at $454,000, slightly below the estimated $460,000 [6] - New orders decreased 16% year over year to 4,735 units, while the ASP for new orders increased by 3% to $464,800 [8] Market Conditions - The housing market continues to show softness, with affordability challenges exacerbated by macroeconomic uncertainty and inflation [2] - Backlog units decreased 19% year over year to 9,165 homes, with a dollar value of $4.39 billion [8] - The cancellation rate for new orders increased to 19%, up from 15% a year ago [8] Cost and Margin Analysis - Gross margin contracted by 240 basis points year over year to 21%, primarily due to higher lot costs and pricing pressures [7] - Contract land deposit impairments totaled approximately $18.9 million, contributing to the decline in profitability [7] Mortgage Banking Performance - Mortgage banking fees fell 11.1% year over year to $49.2 million, with closed loan production totaling $1.54 billion, down 7% [9] - The capture rate remained stable at 86%, consistent with the previous year [9] Cash Position and Share Repurchase - As of September 30, 2025, NVR had cash and cash equivalents of $1.93 billion for Homebuilding and $39.3 million for Mortgage Banking, down from $2.56 billion and $49.6 million at the end of 2024 [10] - The company repurchased 178,178 shares for $1.33 billion during the first nine months of 2025 [10]

Core Insights - NVR, Inc. is a prominent player in the homebuilding and mortgage banking industry, focusing on single-family homes, townhomes, and condominiums in the United States [1] Financial Performance - For Q3 2025, NVR reported earnings per share (EPS) of $112.33, exceeding the estimated $104.27 and the consensus estimate of $107.88, although this represents a decline from $130.50 in the same quarter last year [2] - NVR's revenue for Q3 2025 was approximately $2.61 billion, surpassing the estimated $2.43 billion, but down from $2.73 billion in the same period of the previous year [3] - The company's net income for Q3 2025 was $342.7 million, translating to $112.33 per diluted share, marking a 20% decline in net income and a 14% decrease in diluted EPS compared to Q3 2024 [4] - For the first nine months of 2025, NVR's consolidated revenues totaled $7.61 billion, reflecting a 1% decrease from the previous year [3][4] Financial Ratios - NVR maintains a price-to-earnings (P/E) ratio of approximately 14.93, indicating the market's valuation of the company's earnings [5] - The company's debt-to-equity ratio is low at 0.27, reflecting a conservative approach to leveraging [5] - NVR's current ratio is approximately 3.79, highlighting its strong liquidity position to meet short-term obligations [5]

Core Insights - NVR reported quarterly earnings of $112.33 per share, exceeding the Zacks Consensus Estimate of $107.88 per share, but down from $130.5 per share a year ago, indicating an earnings surprise of +4.12% [1] - The company generated revenues of $2.56 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 6.34%, although this represents a decline from $2.68 billion in the same quarter last year [2] - NVR has outperformed consensus EPS estimates three times in the last four quarters and has also topped revenue estimates three times during the same period [2] Earnings Outlook - The future performance of NVR's stock will largely depend on management's commentary during the earnings call and the sustainability of the stock's immediate price movement based on the recently released numbers [3][4] - The current consensus EPS estimate for the upcoming quarter is $104.27, with expected revenues of $2.45 billion, while the estimate for the current fiscal year is $418.15 on $9.69 billion in revenues [7] Industry Context - The Building Products - Home Builders industry, to which NVR belongs, is currently ranked in the bottom 17% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors or through tools like the Zacks Rank [5][6]

[Overall Financial Performance](index=1&type=section&id=Overall%20Financial%20Performance) NVR, Inc. reported a decline in net income, diluted EPS, and consolidated revenues for both the third quarter and the first nine months of 2025 compared to the prior year [Third Quarter 2025 Financial Highlights](index=1&type=section&id=Third%20Quarter%202025%20Financial%20Highlights) NVR, Inc. reported a decrease in net income and diluted earnings per share for the third quarter of 2025 compared to the same period in 2024, alongside a slight reduction in consolidated revenues | Metric | Q3 2025 | Q3 2024 | Change (%) | | :----------------------- | :---------- | :---------- | :--------- | | Net Income | $342.7 Million | $429.3 Million | -20% | | Diluted EPS | $112.33 | $130.50 | -14% | | Consolidated Revenues | $2.61 Billion | $2.73 Billion | -4.4% | [Nine Months Ended September 30, 2025 Financial Highlights](index=1&type=section&id=Nine%20Months%20Ended%20September%2030%2C%202025%20Financial%20Highlights) For the first nine months of 2025, NVR, Inc. experienced a decrease in consolidated revenues, net income, and diluted earnings per share compared to the same period in 2024 | Metric | 9M 2025 | 9M 2024 | Change (%) | | :----------------------- | :---------- | :---------- | :--------- | | Consolidated Revenues | $7.61 Billion | $7.68 Billion | -1% | | Net Income | $976.0 Million | $1.22 Billion | -20% | | Diluted EPS | $315.33 | $367.20 | -14% | [Segment Performance](index=1&type=section&id=Segment%20Performance) The homebuilding segment experienced declines in key operational and financial metrics, while the mortgage banking segment also reported reduced loan production and income [Homebuilding Segment](index=1&type=section&id=Homebuilding%20Segment) The homebuilding segment saw declines in new orders, settlements, and backlog units, along with a decrease in revenues and gross profit margin, primarily due to higher lot costs, pricing pressure, and land deposit impairments [Homebuilding Operational Metrics](index=1&type=section&id=Homebuilding%20Operational%20Metrics) Key operational metrics for the homebuilding segment showed a decrease in new orders and settlements, an increase in cancellation rates, and a reduction in backlog units and dollar value | Metric | Q3 2025 | Q3 2024 | Change (%) | | :-------------------------- | :------ | :------ | :--------- | | New Orders (units) | 4,735 | 5,650 | -16% | | Avg Sales Price (New Orders)| $464,800| $450,700| +3% | | Cancellation Rate | 19% | 15% | +4 percentage points | | Settlements (units) | 5,639 | 5,908 | -5% | | Avg Settlement Price | $454,000| $453,200| Flat | | Metric | Sep 30, 2025 | Sep 30, 2024 | Change (%) | | :-------------------------- | :----------- | :----------- | :--------- | | Backlog (units) | 9,165 | 11,339 | -19% | | Backlog (dollar) | $4.39 Billion | $5.29 Billion | -17% | [Homebuilding Financial Performance](index=1&type=section&id=Homebuilding%20Financial%20Performance) Homebuilding revenues decreased, and the gross profit margin declined due to increased lot costs, pricing pressures, and contract land deposit impairments. Income before tax also saw a significant reduction | Metric | Q3 2025 | Q3 2024 | Change (%) | | :-------------------- | :---------- | :---------- | :--------- | | Homebuilding Revenues | $2.56 Billion | $2.68 Billion | -4% | | Gross Profit Margin | 21.0% | 23.4% | -2.4 percentage points | | Income Before Tax | $411.4 Million | $503.7 Million | -18% | - Gross profit margin was negatively impacted by higher lot costs, pricing pressure due to continued affordability challenges, and contract land deposit impairments totaling approximately **$18.9 million**[5](index=5&type=chunk) [Mortgage Banking Segment](index=1&type=section&id=Mortgage%20Banking%20Segment) The mortgage banking segment reported a decrease in closed loan production and a slight decline in income before tax for the third quarter of 2025 | Metric | Q3 2025 | Q3 2024 | Change (%) | | :-------------------------- | :---------- | :---------- | :--------- | | Mortgage Closed Loan Production | $1.54 Billion | $1.66 Billion | -7% | | Income Before Tax | $32.7 Million | $34.9 Million | -6% | [Effective Tax Rate](index=1&type=section&id=Effective%20Tax%20Rate) The effective tax rate increased for both the three and nine-month periods ended September 30, 2025, primarily due to a lower income tax benefit from stock option exercises [Effective Tax Rate Analysis](index=1&type=section&id=Effective%20Tax%20Rate%20Analysis) The effective tax rate increased for both the three and nine-month periods ended September 30, 2025, primarily due to a lower income tax benefit from excess tax benefits from stock option exercises | Period | 2025 Effective Tax Rate | 2024 Effective Tax Rate | | :-------------------- | :---------------------- | :---------------------- | | Three Months Ended Sep 30 | 22.8% | 20.3% | | Nine Months Ended Sep 30 | 24.5% | 20.6% | - The increase in the effective tax rate is primarily attributable to a lower income tax benefit recognized for excess tax benefits from stock option exercises, which totaled **$13.4 million** (Q3 2025) and **$19.7 million** (9M 2025), compared to **$23.1 million** (Q3 2024) and **$73.7 million** (9M 2024)[7](index=7&type=chunk) [Consolidated Financial Statements](index=3&type=section&id=Consolidated%20Financial%20Statements) This section presents the consolidated statements of income and balance sheets, reflecting overall financial performance and position [Consolidated Statements of Income](index=3&type=section&id=Consolidated%20Statements%20of%20Income) The consolidated statements of income show a decline in revenues, net income, and earnings per share for both the three and nine months ended September 30, 2025, compared to the prior year | | Three Months Ended September 30, | | | Nine Months Ended September 30, | | | :---------------------------------- | :--- | :--- | :--- | :--- | :--- | | | 2025 ($ thousands) | 2024 ($ thousands) | 2025 ($ thousands) | 2024 ($ thousands) | | Homebuilding: | | | | | | Revenues | $2,560,343 | $2,677,640 | $7,459,055 | $7,511,708 | | Other income | 22,000 | 33,746 | 73,800 | 110,796 | | Cost of sales | (2,021,398) | (2,051,087) | (5,856,756) | (5,724,916) | | Selling, general and administrative | (142,736) | (149,777) | (457,023) | (443,493) | | Interest expense | (6,855) | (6,855) | (20,721) | (20,214) | | Homebuilding income | 411,354 | 503,667 | 1,198,355 | 1,433,881 | | Mortgage Banking: | | | | | | Mortgage banking fees | 49,162 | 55,311 | 152,296 | 167,163 | | Interest income | 4,881 | 4,728 | 13,180 | 13,492 | | Other income | 1,400 | 1,414 | 3,794 | 3,918 | | General and administrative | (22,397) | (26,317) | (73,515) | (75,026) | | Interest expense | (327) | (191) | (900) | (556) | | Mortgage banking income | 32,719 | 34,945 | 94,855 | 108,991 | | Income before taxes | 444,073 | 538,612 | 1,293,210 | 1,542,872 | | Income tax expense | (101,385) | (109,289) | (317,209) | (318,376) | | Net income | $342,688 | $429,323 | $976,001 | $1,224,496 | | Basic earnings per share ($) | $119.26 | $139.65 | $333.86 | $391.37 | | Diluted earnings per share ($) | $112.33 | $130.50 | $315.33 | $367.20 | | Basic weighted average shares outstanding (in thousands) | 2,874 | 3,074 | 2,923 | 3,129 | | Diluted weighted average shares outstanding (in thousands) | 3,051 | 3,290 | 3,095 | 3,335 | [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show a decrease in total assets and total liabilities from December 31, 2024, to September 30, 2025, with a corresponding reduction in total shareholders' equity | ASSETS | September 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :------------------------------------------------------- | :------------------- | :------------------ | | Homebuilding: | | | | Cash and cash equivalents | $1,932,167 | $2,561,339 | | Restricted cash | 44,034 | 42,172 | | Receivables | 41,377 | 32,622 | | Inventory: | | | | Lots and housing units, covered under sales agreements with customers | 1,758,906 | 1,727,243 | | Unsold lots and housing units | 313,971 | 237,177 | | Land under development | 38,017 | 65,394 | | Building materials and other | 20,531 | 28,893 | | Total Inventory | 2,131,425 | 2,058,707 | | Contract land deposits, net | 868,308 | 726,675 | | Property, plant and equipment, net | 102,479 | 95,619 | | Operating lease right-of-use assets | 87,116 | 78,340 | | Reorganization value in excess of amounts allocable to identifiable assets, net | 41,580 | 41,580 | | Other assets | 291,748 | 251,178 | | Total Homebuilding Assets | 5,540,234 | 5,888,232 | | Mortgage Banking: | | | | Cash and cash equivalents | 39,280 | 49,636 | | Restricted cash | 8,123 | 11,520 | | Mortgage loans held for sale, net | 341,579 | 355,209 | | Property and equipment, net | 8,081 | 7,373 | | Operating lease right-of-use assets | 25,252 | 23,482 | | Reorganization value in excess of amounts allocable to identifiable assets, net | 7,347 | 7,347 | | Other assets | 65,562 | 38,189 | | Total Mortgage Banking Assets | 495,224 | 492,756 | | Total assets | $6,035,458 | $6,380,988 | | LIABILITIES AND SHAREHOLDERS' EQUITY | September 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | | :------------------------------------------------------- | :------------------- | :------------------ | | Homebuilding: | | | | Accounts payable | $361,209 | $332,772 | | Accrued expenses and other liabilities | 344,658 | 441,300 | | Customer deposits | 277,351 | 322,926 | | Operating lease liabilities | 93,191 | 83,939 | | Senior notes | 909,654 | 911,118 | | Total Homebuilding Liabilities | 1,986,063 | 2,092,055 | | Mortgage Banking: | | | | Accounts payable and other liabilities | 55,249 | 53,433 | | Operating lease liabilities | 27,384 | 25,428 | | Total Mortgage Banking Liabilities | 82,633 | 78,861 | | Total liabilities | 2,068,696 | 2,170,916 | | Shareholders' equity: | | | | Common stock | 206 | 206 | | Additional paid-in capital | 3,131,980 | 3,031,637 | | Deferred compensation trust | (16,710) | (16,710) | | Deferred compensation liability | 16,710 | 16,710 | | Retained earnings | 16,022,954 | 15,046,953 | | Less treasury stock at cost | (15,188,378) | (13,868,724) | | Total shareholders' equity | 3,966,762 | 4,210,072 | | Total liabilities and shareholders' equity | $6,035,458 | $6,380,988 | [Operating Activity & Key Metrics](index=6&type=section&id=Operating%20Activity%20%26%20Key%20Metrics) This section details regional homebuilding performance, including new orders, settlements, and backlog, alongside other key operational data [Homebuilding Operating Metrics by Region](index=6&type=section&id=Homebuilding%20Operating%20Metrics%20by%20Region) Regional operating data indicates varied performance across NVR's markets, with overall declines in new orders and settlements, and a reduction in backlog units across most regions [New Orders, Net of Cancellations](index=6&type=section&id=New%20Orders%2C%20Net%20of%20Cancellations) New orders decreased across all regions in Q3 2025 compared to Q3 2024, with varying changes in average prices. The Mid Atlantic region saw the largest unit decline | Region | Q3 2025 Units | Q3 2025 Avg Price ($ thousands) | Q3 2024 Units | Q3 2024 Avg Price ($ thousands) | 9M 2025 Units | 9M 2025 Avg Price ($ thousands) | 9M 2024 Units | 9M 2024 Avg Price ($ thousands) | | :------------- | :------------ | :-------------------- | :------------ | :-------------------- | :------------ | :-------------------- | :------------ | :-------------------- | | Mid Atlantic | 1,714 | $529.7 | 2,206 | $514.7 | 5,510 | $525.1 | 6,785 | $522.2 | | North East | 433 | $647.1 | 536 | $616.4 | 1,234 | $664.6 | 1,541 | $617.2 | | Mid East | 931 | $431.9 | 1,105 | $400.2 | 3,101 | $425.0 | 3,630 | $404.8 | | South East | 1,657 | $368.6 | 1,803 | $354.1 | 5,614 | $361.8 | 5,810 | $363.9 | | **Total** | **4,735** | **$464.8** | **5,650** | **$450.7** | **15,459** | **$456.8** | **17,766** | **$454.7** | [Settlements](index=6&type=section&id=Settlements) Settlements decreased in Q3 2025 compared to Q3 2024, with mixed average price changes across regions. The Mid Atlantic region also saw the largest unit decrease in settlements | Region | Q3 2025 Units | Q3 2025 Avg Price ($ thousands) | Q3 2024 Units | Q3 2024 Avg Price ($ thousands) | 9M 2025 Units | 9M 2025 Avg Price ($ thousands) | 9M 2024 Units | 9M 2024 Avg Price ($ thousands) | | :------------- | :------------ | :-------------------- | :------------ | :-------------------- | :------------ | :-------------------- | :------------ | :-------------------- | | Mid Atlantic | 2,008 | $517.9 | 2,229 | $514.9 | 6,159 | $527.8 | 6,394 | $515.9 | | North East | 420 | $694.6 | 495 | $606.9 | 1,365 | $651.7 | 1,445 | $583.6 | | Mid East | 1,200 | $423.8 | 1,219 | $411.1 | 3,295 | $416.1 | 3,343 | $404.5 | | South East | 2,011 | $357.9 | 1,965 | $370.5 | 5,428 | $358.8 | 5,474 | $368.5 | | **Total** | **5,639** | **$454.0** | **5,908** | **$453.2** | **16,247** | **$459.1** | **16,656** | **$451.0** | [Backlog](index=6&type=section&id=Backlog) Backlog units and dollar value decreased across all regions as of September 30, 2025, compared to the prior year, despite an increase in average backlog price | Region | Sep 30, 2025 Units | Sep 30, 2025 Avg Price ($ thousands) | Sep 30, 2024 Units | Sep 30, 2024 Avg Price ($ thousands) | | :------------- | :----------------- | :------------------------- | :----------------- | :------------------------- | | Mid Atlantic | 3,419 | $539.7 | 4,485 | $531.4 | | North East | 924 | $676.0 | 1,124 | $646.5 | | Mid East | 1,851 | $431.3 | 2,263 | $411.5 | | South East | 2,971 | $379.1 | 3,467 | $369.8 | | **Total** | **9,165** | **$479.5** | **11,339** | **$469.5** | [Other Key Operating Data](index=7&type=section&id=Other%20Key%20Operating%20Data) This section provides additional operational insights, including average active communities, cancellation rates, lots controlled, mortgage banking performance, and common stock information | Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 | | :-------------------------------- | :------ | :------ | :------ | :------ | | Average active communities | 450 | 422 | 426 | 427 | | New order cancellation rate | 19.4% | 14.5% | 17.1% | 13.5% | | Lots controlled at end of period | N/A | N/A | 175,300 | 151,800 | | Mortgage banking loan closings ($ thousands)| $1,539,781 | $1,656,507 | $4,527,982 | $4,564,597 | | Mortgage banking capture rate | 86% | 86% | 86% | 86% | | Shares outstanding at end of period (units) | N/A | N/A | 2,860,899 | 3,064,790 | | Number of shares repurchased | 35,224 | 42,629 | 178,178 | 192,655 | | Aggregate cost of shares repurchased ($ thousands) | $276,405 | $357,450 | $1,331,212 | $1,493,362 | [Company Information & Disclosures](index=2&type=section&id=Company%20Information%20%26%20Disclosures) This section provides an overview of NVR's business operations and important disclaimers regarding forward-looking statements [About NVR](index=2&type=section&id=About%20NVR) NVR, Inc. operates as a homebuilding and mortgage banking company, building homes under several trade names across numerous metropolitan areas in sixteen states and Washington, D.C - NVR, Inc. operates in two business segments: homebuilding and mortgage banking[8](index=8&type=chunk) - The homebuilding segment sells and builds homes under the Ryan Homes, NVHomes, and Heartland Homes trade names[8](index=8&type=chunk) - NVR operates in thirty-six metropolitan areas across sixteen states and Washington, D.C.[8](index=8&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) The release contains forward-looking statements subject to various known and unknown risks and uncertainties that could cause actual results to differ materially from projections - Statements in the release may constitute 'forward-looking statements' under the Private Securities Litigation Reform Act of 1995 and other securities acts[9](index=9&type=chunk) - Forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or performance to be materially different from expressed or implied expectations[9](index=9&type=chunk) - Risk factors include general economic and business conditions, interest rate changes, access to financing, increased regulation in mortgage banking, competition, availability and cost of land and raw materials, labor shortages, and governmental regulation[9](index=9&type=chunk)

Core Insights - NVR, Inc. reported a net income of $342.7 million for Q3 2025, a decrease of 20% from $429.3 million in Q3 2024, with diluted earnings per share down 14% to $112.33 from $130.50 [1] - Consolidated revenues for Q3 2025 were $2.61 billion, down from $2.73 billion in Q3 2024, while revenues for the nine months ended September 30, 2025, totaled $7.61 billion, a 1% decrease from $7.68 billion in the same period of 2024 [1][3] Homebuilding Segment - New orders in Q3 2025 decreased by 16% to 4,735 units compared to 5,650 units in Q3 2024, while the average sales price of new orders increased by 3% to $464,800 [2] - The cancellation rate rose to 19% in Q3 2025 from 15% in Q3 2024, and settlements decreased by 5% to 5,639 units [2] - Homebuilding revenues for Q3 2025 were $2.56 billion, a 4% decrease from $2.68 billion in Q3 2024, with gross profit margin declining to 21.0% from 23.4% [3] Mortgage Banking Segment - Mortgage closed loan production in Q3 2025 totaled $1.54 billion, a decrease of 7% from $1.66 billion in Q3 2024, with income before tax from the mortgage banking segment down 6% to $32.7 million [4] - The effective tax rate for the three and nine months ended September 30, 2025, was 22.8% and 24.5%, respectively, compared to 20.3% and 20.6% for the same periods in 2024 [4] Financial Performance - For the nine months ended September 30, 2025, net income was $976.0 million, a decrease of 20% from $1.22 billion in the same period of 2024, with diluted earnings per share down 14% to $315.33 [1][4] - The backlog of homes sold but not settled as of September 30, 2025, decreased by 19% to 9,165 units, with a dollar value decrease of 17% to $4.39 billion compared to the same date in 2024 [2]

Core Viewpoint - The housing market is facing challenges due to a perceived demand problem rather than a supply problem, which could negatively impact housing companies like KB Home [2][4] Company Analysis - KB Home has been downgraded by analysts amid concerns about the housing market and government policies aimed at increasing supply [2][3] - Despite the downgrade, there is a belief that housing stocks, including KB Home, could trade at higher multiples in the long term due to improved operations and competitive advantages [3][4] Industry Insights - Analysts argue that the current focus on supply-side solutions by the government may not address the underlying demand issues in the housing market [2] - The performance of builders like KB Home is being compared to peers, with the expectation that they will eventually receive a revaluation to higher multiples due to their operational improvements [4]

Group 1 - The article does not provide any specific content related to a company or industry [1]

Summary of Key Points from the Conference Call Industry Overview - The report discusses the current state of the U.S. housing market and broader economic conditions, focusing on the impact of interest rates on consumer behavior and asset classes such as stocks and housing [1][20][22]. Core Insights and Arguments 1. **Market Conditions**: - U.S. households currently hold $19.6 trillion in cash, the highest since 1991, while existing home sales are at levels comparable to the Global Financial Crisis (GFC) [21][22]. - The divergence between high stock prices and low housing market activity is attributed to high interest rates, which have made housing less affordable [20][22]. 2. **Interest Rates and Economic Policy**: - The BofA base case anticipates a 4% yield on 10-year Treasuries and a 3.9% Fed rate by the end of Q4 [3][38]. - There is speculation that lower interest rates and potential tariff relief could stimulate economic growth ahead of midterm elections, which may lead to bullish market conditions [3][39]. 3. **Consumer Behavior**: - Despite weak sentiment indicators, consumer spending remains strong, with higher-income households showing a 4% wage growth, supporting continued spending [12][40]. - The report suggests that consumer spending is likely to prevail over negative sentiment, as spending has historically outpaced sentiment trends [44]. 4. **Housing Market Dynamics**: - The housing market is described as "frozen" due to high mortgage rates and low affordability, with existing home sales averaging 4 million in 2025 [22][46]. - A mortgage rate of around 5% is considered necessary to stimulate the housing market, which would require significant cuts in the Fed rate and Treasury yields [46][39]. 5. **Investment Opportunities**: - The report identifies potential investment opportunities in small-cap value stocks, homebuilders, and long-duration Treasuries, particularly if interest rates decline [4][67][78]. - Homebuilders are currently trading at historical averages, and past rate-cutting cycles have shown that they tend to outperform the S&P 500 [73][55]. Additional Important Insights - **Global Monetary Policy**: - 91% of global central banks are currently in easing mode, which is expected to support growth cycles [18][26]. - The report highlights the historical precedent set by Paul Volcker, suggesting that significant rate cuts could lead to a doubling of equity values, as seen in the mid-1980s [31][32]. - **Sector Performance**: - REITs are expected to benefit from declining rates, with healthcare REITs performing particularly well [61][66]. - Emerging market debt is positioned to outperform due to aggressive rate cuts in those regions [84][85]. - **Technical Analysis**: - The Russell 2500 index has shown strong recovery patterns, indicating potential for further upside if it breaks above key resistance levels [96][97]. This summary encapsulates the key points discussed in the conference call, providing insights into the current economic landscape, consumer behavior, and potential investment strategies.