Core Viewpoint - United Homes Group, Inc. (UHG) has experienced significant declines in stock performance and financial metrics for the first quarter of 2025, primarily due to reduced home closings and increased operational challenges [1][2][3]. Revenue and Earnings Overview - UHG reported revenues of $87 million for Q1 2025, a decrease of 13.7% from $100.8 million in Q1 2024, driven by an 18.9% drop in home closings to 252 units [2] - The average sales price of production-built homes increased by 2.9% to approximately $345,000 compared to $335,000 in the previous year [2] - Net income fell to $18.2 million, or $0.31 per diluted share, down 27.1% from $24.9 million, or $0.44 per share, in the prior-year quarter [3] - Adjusted EBITDA decreased by 60.6% to $2.9 million from $7.3 million in the prior year, indicating ongoing margin pressure [3] Other Key Business Metrics - Gross profit declined by 12.2% year over year to $14.1 million, with a reported gross margin of 16.2%, slightly up from 16% in Q1 2024 [4] - Adjusted gross profit was $16.4 million, down 20.4% from $20.6 million, with adjusted gross margin dropping to 18.8% from 20.4% due to elevated incentives [4] - Net new orders decreased by 22.9% to 296 homes from 384, although there was a sequential improvement in sales pace and margins as the quarter progressed [5] Management Commentary - Interim CEO Jamie Pirrello described the quarter as a "tale of two halves," noting a rebound in demand starting in late February [7] - President Jack Micenko highlighted a 400 basis-point sequential gross margin improvement, driven by new home designs achieving gross margins around 24% [8] Cost Management and Efficiency - CFO Keith Feldman reported over $3.5 million in direct construction savings identified through cost-reduction strategies, with benefits expected in the second half of the year [9] - The company achieved $1 million in savings from reduced interest expenses following a refinancing initiative [9] - Average construction cycle time improved by 16 days compared to the previous year due to better material and labor availability [12] Guidance and Outlook - Management expressed optimism for the remainder of 2025, with April orders up 6% year over year and expectations for continued margin enhancement [13] - UHG plans to launch 10 new communities in Q2 and 18 in Q3, featuring new home designs that are well-received by buyers [13] Other Developments - UHG maintains an asset-light, land-light strategy, controlling approximately 7,500 lots through various arrangements [14] - The company is evaluating geographic expansion based on favorable demographic and economic trends [14]