PulteGroup, Inc. (NYSE:PHM) reported mixed first-quarter results on Thursday. The homebuilder reported EPS of $1.79, which missed the $1.83 estimate. Sales of $3.409 billion exceeded the $3.385 billion estimate.
Homebuilding revenue totaled $3.34 billion, compared with $3.80 billion a year earlier. Home sale revenues were $3.31 billion versus $3.75 billion a year ago quarter.
Land sale and other revenues declined to $29.3 million from $52.6 million a year ago quarter. Closings volumes fell 7% to 6,102 homes, and the average selling price declined 5% to $542,000.
Reported home sale gross margin came in at 24.4% versus 27.5% in the prior year quarter. This is due to higher incentives of 10.9% of gross sales price, up 290 basis points year over year.
Absorption pace declined by 5% to 2.6 homes per month, while cancellation rates rose slightly to 13% versus 11% last year, reflecting a smaller starting backlog rather than higher cancellations.
Orders and Backlog
Net new orders increased 3% year over year (Y/Y) to 8,034 homes, with an order value of $4.6 billion. This is led by strong demand in Florida, with build-to-order homes increasing to 43% of total orders.
Backlog ended the quarter at 10,427 homes valued at $6.5 billion.
Financial Services revenue declined to $71.7 million from $90.8 million in the prior-year period, with pre-tax income of $13 million compared with $36 million a year earlier.
Capital Allocation and Balance Sheet
PulteGroup repurchased $308 million of shares in the first quarter and authorized an additional $1.5 billion for buybacks, bringing total authorization to $2.1 billion.
The company invested $1.3 billion in land, while total controlled lots stood at 229,000, down about 5,000 from year-end 2025. PulteGroup ended the quarter with $1.8 billion in cash balance.
Outlook
The company reaffirmed its full-year outlook of 28,500–29,000 home closings and expects gross margins to improve in the second half as the mix shifts further toward build-to-order homes.
PHM sees average sales price to remain in the $540,000 to $550,000 range in the second quarter, with full-year ASP guidance of $550,000 to $560,000.
It projects gross margin of 24.1% to 24.4% in the second quarter, with full-year margins expected between 24.5% and 25.0%, likely toward the lower end.
The company sees $5.4 billion in land spending for 2026 and around $1 billion in cash flow generation for the year.
PHM Price Action: PulteGroup shares were up 2.02% at $125.23 at the time of publication on Thursday, according to Benzinga Pro data.
Photo via Shutterstock
Recent Comments