Taylor Morrison Home Stock Earnings Reports

Taylor Morrison reported a strong Q3 2025 driven by its diversified portfolio and community-by-community pricing/pace discipline. Key financials: GAAP net income $201M ($2.01/share), adjusted net income $211M ($2.11/share); Q3 home deliveries 3,324 (slightly above guidance) at an average closing price of $602k; home closings revenue ~$2.0B. Reported home-closing gross margin was 22.1% (adjusted 22.4%); management expects Q4 adjusted home-closing gross margin ~21.5% and full-year reported margin ~22.5% (adjusted ~23%). Starts were intentionally moderated (1,963 starts, 1.9 per community) with specs down ~15% QoQ; specs remain elevated (~70% of sales mix historically) and will be managed into spring 2026. Cycle times continue to improve (another ~10 days saved in Q3 vs. prior quarter; ~30 days faster vs. last year), giving production flexibility. Net orders totaled 2,468 (down ~13% YoY) and cancellations were 10.1% of beginning backlog. Balance sheet/liquidity: ~$1.3B liquidity (371M cash, $955M revolver capacity); net homebuilding debt to capitalization 21.3%. Capital returns: repurchased 1.3M shares ($75M) in Q3; YTD repurchases $310M with at least $350M target for year and $600M remaining authorization. Land and capital strategy: 84,564 controlled lots (6.4 years supply TTM; 2.6 years owned); ~60% of lots controlled via options/off-balance-sheet structures (goal >=65%). Management highlighted progress renegotiating land deals (enhancements covering ~3,400 lots / >$500M purchase price resulting in ~8% average price reduction and ~6-month closing deferrals). Build-to-Rent (Yardley) financing: $3B facility with Kennedy Lewis; transfers of projects out of balance sheet provided capital relief and optionality. Expense control: SG&A leverage improved 80 bps YoY to 9% of home-closing revenue; expecting mid-9% SG&A for full year. Demand/market commentary: sequential improvement in monthly absorption during quarter (Sept strongest since May); traffic and prequalification activity improving; regional commentary: Florida and Phoenix showing notable strength/stability; Texas mixed with some TL headwinds (inventory, H-1B/immigration impacts in select markets). Management launched an AI-powered digital assistant to improve online conversion and customer experience. Looking to 2026: over 100 community openings planned (mid-to-high single digit outlet growth), but management will continue community-level pacing and remains cautious on starts/spec mix until clearer demand stabilization.