Lennar Corp - Class A
Q4 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +2.09%.
Did LEN Beat Earnings? Q4 2025 Results
Lennar delivered a disappointing finish to fiscal 2025, posting Q4 GAAP earnings of $1.93 per share and missing the $2.25 consensus estimate by 14.22%, as a brutal combination of margin compression and affordability headwinds weighed heavily on results. Revenue fell 6.5% year over year to $9.37 billion, with the average sales price declining 10% to $386,000 per home even as deliveries rose 4% to 23,034 units, a tradeoff that reflects the roughly 14% in incentives and price adjustments Lennar leaned on to keep sales moving. Gross margin on home sales collapsed to 17.0% from 22.1% a year ago, the single most consequential driver of the earnings shortfall, and <a href="https://247wallst.com/investing/2025/12/09/toll-brothers-posts-sixth-straight-earnings-beat-but-stock-drops-on-tepid-growth/">a pattern weighing on the sector broadly</a>. New orders surged 18% to 20,018 homes, suggesting underlying demand remains present if price-sensitive. Looking ahead, management guided Q1 fiscal 2026 deliveries of 17,000 to 18,000 homes at an average sales price of $365,000 to $375,000, with gross margins of 15% to 16%, signaling further near-term pressure before any potential stabilization.
- 4% increase in home deliveries to 23,034 homes
- 18% increase in new orders to 20,018 homes
- 10% decrease in average sales price to $386,000 due to market weakness and increased incentives
- Gross margin on home sales compressed to 17.0% from 22.1% year over year
- Approximately 14% in incentives and price adjustments maintained to drive volume
- Construction cycle times improved to 127 days
- Inventory turn improved to 2.2 times
- Community count increased to 1,708 from 1,447
“Even as interest rates moved slightly lower in our fourth quarter, the overall market remained challenged. Accordingly, our fourth quarter and full year 2025 results reflect a disciplined commitment to increasing housing supply in a market constrained by affordability challenges, as well as weak consumer confidence. Despite the added pressure of a six-week government shutdown, we continued to build and sell homes, adapting as needed to changing market conditions.”
Lennar CEO, on the earnings call
Forward Guidance & Outlook
For Q1 fiscal 2026, Lennar expects new orders of 18,000-19,000 homes, deliveries of 17,000-18,000 homes, average sales price of $365,000-$375,000, gross margin on home sales of 15.0%-16.0%, SG&A as a percentage of home sales of approximately 9.5%, and Financial Services operating earnings of $105-$110 million. For full fiscal year 2026, the company expects deliveries of approximately 85,000 homes. Management characterized guidance as limited given market uncertainty around affordability challenges and consumer confidence.
LEN YoY Financials
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Figures from SEC filings and company reports. Not investment advice.