KB Home (KBH) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenues were $1.53 billion, down 10–11% year-over-year, with net income at $107.9 million and diluted EPS of $1.50, reflecting softer demand and affordability challenges.

• Deliveries declined 11% to 3,120 homes, and net orders fell 13% to 3,460 units; backlog value dropped 27% to $2.29 billion.

• The company met or exceeded Q2 guidance, but revised full-year 2025 guidance downward due to subdued spring demand and lower net orders.

• Operational focus included reducing build times, lowering direct costs, and maintaining high customer satisfaction.

• Repurchased $200 million in shares in Q2, with book value per share up 10% year-over-year to $58.64.

Financial highlights

• Q2 total revenues were $1.53 billion; homebuilding revenues were $1.52 billion.

• Average selling price increased slightly to $488,700; adjusted housing gross profit margin was 19.7%, down 150 bps year-over-year.

• Homebuilding operating income margin was 8.6% (9.0% adjusted), down from 11.1% last year.

• SG&A expense ratio increased to 10.7% from 10.1% year-over-year.

• Total liquidity at quarter end was $1.19 billion, including $308.9 million in cash and $881.7 million available on the revolver.

Outlook and guidance

• FY2025 housing revenues expected between $6.3–$6.5 billion; Q3 guidance is $1.5–$1.7 billion.

• Full-year average selling price expected at $480,000–$490,000; Q3 ASP guidance is $470,000–$480,000.

• Adjusted housing gross profit margin expected at 19.0–19.4% for FY2025; Q3 margin expected at 18.1–18.7%.

• SG&A ratio projected at 10.2–10.6% for the year; effective tax rate expected at 24%.

• Homebuilding operating income margin expected at 8.6–9% for the year; targeting approximately 13,200 deliveries.