Taylor Morrison Home Corp
Q3 2025 Earnings
Market Reaction
Did TMHC Beat Earnings? Q3 2025 Results
Taylor Morrison delivered a stronger-than-expected third quarter, with adjusted earnings per share of $2.11 beating the $1.92 consensus estimate by 9.80% even as the homebuilder navigated genuine demand headwinds. Revenue came in at $2.10 billion, edging past the $2.03 billion estimate by 3.03%, though the figure still represented a 1.2% decline from a year ago as softening buyer sentiment weighed on volume. The most telling pressure point was in net sales orders, which fell 13% to 2,468 homes while the cancellation rate more than doubled to 10.1% from 4.7% a year earlier, reflecting the kind of affordability-driven hesitation that had analysts bracing for a steeper earnings miss heading into the print. Home closings gross margin compressed 270 basis points to 22.1%, a consequence of elevated pricing incentives particularly at entry-level price points. Looking ahead, management guided full-year 2025 closings of 12,800 to 13,000 at an average price near $595,000, with GAAP gross margin of approximately 22.5%, signaling cautious but stable expectations for the remainder of the year.
- West segment closings revenue grew 16.2% YoY driven by 6.3% volume increase and 9.4% higher average selling price
- SG&A leverage improved 80 bps to 9.0% of home closings revenue from lower payroll and commission costs
- Average closing price increased 1% to $602,000 partially offsetting 2% decline in closings volume
- Diversified portfolio and careful calibration of inventory, pricing and pace across communities
- Net absorption paces improved each month during the quarter as mortgage rate declines spurred activity
“We are pleased to report strong third quarter results despite the continuation of challenging market conditions. Driven by our diversified portfolio and team's careful calibration of inventory, pricing and pace across our well-located communities, we once again met or exceeded our guidance on all key metrics, including home closings volume, price and gross margin. The ongoing execution of our balanced operating strategy has allowed us to maintain healthy performance even as we have adjusted pricing and incentives, particularly in entry-level price points. Combined with a thoughtful approach to land-lighter financing tools and effective cost management, our business is generating strong bottom-line earnings, cash flow and returns for our shareholders.”
Taylor Morrison CEO, on the earnings call
Forward Guidance & Outlook
For Q4 2025, the company expects ending active community count of approximately 345, home closings of 3,100-3,300, average closing price of approximately $590,000, GAAP home closings gross margin of approximately 21.5%, effective tax rate of approximately 25%, and diluted share count of approximately 99 million. For full year 2025, home closings are now expected at 12,800-13,000, average closing price of approximately $595,000, GAAP home closings gross margin of approximately 22.5%, adjusted home closings gross margin of approximately 23%, ending active community count of approximately 345, SG&A as a percentage of home closings revenue in the mid-9% range, effective tax rate of 24.5%-25%, diluted share count of approximately 101 million, homebuilding land acquisition and development investment of approximately $2.3 billion, and share repurchases of at least $350 million.
TMHC YoY Financials
TMHC Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.