Lennar (LEN) Q1 2026 earnings summary

Executive summary

• Delivered Q1 2026 results amid a challenging housing market with high prices, elevated interest rates, and global uncertainties, but maintained optimism due to operational progress and strategic positioning.

• Net earnings for Q1 2026 were $229 million, or $0.93 per diluted share, down from $520 million, or $1.96 per share, in Q1 2025; excluding mark-to-market gains, EPS was $0.88.

• Leadership transition underway with experienced new area presidents, focusing on continuity and fresh perspectives.

• Maintained volume and matched production to sales pace, ending the quarter with balanced inventory and a 6% year-over-year increase in community count.

• New orders rose 1% year-over-year to 18,515 homes, while deliveries fell 5% to 16,863 homes; backlog stood at 15,588 homes valued at $6.0 billion.

Financial highlights

• Q1 net income was $229 million, with EPS of $0.93; total revenues declined to $6.6 billion from $7.6 billion year-over-year.

• Gross margin was 15.2%, net margin 5.3%, and SG&A at 9.8%.

• Average sales price was $374,000, down 8% year-over-year, reflecting higher incentives to drive affordability.

• Inventory turn improved to 2.5x from 1.7x a year ago; return on inventory reached 17.4%.

• Financial Services operating earnings were $91 million, mainly impacted by a shift to ARMs and down from $143 million year-over-year.

Outlook and guidance

• Q2 new orders expected at 21,000–22,000 homes; deliveries at 20,000–21,000.

• Q2 average sales price projected at $370,000–$375,000; gross margin guidance at 15.5%–16%.

• SG&A expected at 8.9%–9.1%; EPS guidance for Q2 is $1.10–$1.40.

• Full-year delivery target reaffirmed at 85,000 homes.

• Financial Services operating earnings projected at $100–$110 million for Q2.