D.R. Horton beats Q3 expectations as home closings exceed guidance
The company delivered 23,160 homes during the quarter, exceeding the high end of its guidance range despite ongoing affordability challenges in the housing market. However, net income attributable to D.R. Horton decreased 24% to $1.0 billion compared to $1.4 billion in the same quarter last year, while revenue declined 7% from $10.0 billion in the prior-year period. The company's shares edged down 0.4% following the announcement.
"The D.R. Horton team delivered a strong third quarter, highlighted by earnings per diluted share of $3.36," said David Auld, Executive Chairman. "We leveraged our operational results and strong balance sheet to return $1.3 billion to shareholders through share repurchases and dividends during the quarter, and we have reduced our outstanding share count by 9% from a year ago."
Net sales orders for the quarter were essentially flat at 23,071 homes compared to 23,001 homes in the same quarter of fiscal 2024, though order value decreased 3% to $8.4 billion. The company maintained a home sales gross margin of 21.8%, while its pre-tax profit margin was 14.7%.
D.R. Horton updated its fiscal 2025 guidance, projecting consolidated revenues between $33.7 billion and $34.2 billion, in line with the analyst consensus of $34.04 billion. The company expects to close between 85,000 and 85,500 homes for the full fiscal year.
The homebuilder noted that new home demand continues to be impacted by affordability constraints and cautious consumer sentiment. Management expects sales incentives to remain elevated and potentially increase further during the fourth quarter, depending on summer demand, mortgage interest rate changes, and other market conditions.
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