M
ME NEWS
24 Jun 2025, 14:56
KB Home Posts Q2 Earnings of $1.50 Per Share, Boosts Buybacks as Revenues Decline
KB Home reported a second-quarter performance marked by disciplined cost controls, a strong balance sheet, and aggressive share repurchases, despite year-over-year declines in revenue and net income. Total revenue for the quarter reached $1.53 billion, down from $1.71 billion, with 3,120 homes delivered—a decrease of 11%. The average selling price rose slightly to $488,700.
Net income fell to $107.9 million, translating to $1.50 in diluted earnings per share, compared to $2.15 per share in the same period last year. The company attributed the lower earnings to a combination of fewer home deliveries, price concessions, and reduced leverage on fixed costs. The housing gross margin was 19.3%, or 19.7% on an adjusted basis excluding inventory charges, down from 21.1% a year earlier.
Homebuilding operating income for the quarter was $131.5 million with an 8.6% margin. The financial services segment contributed $8.2 million in pretax income, lower than the $13.3 million in the prior-year period due to weaker performance in the mortgage joint venture.
As part of its capital allocation strategy, the company repurchased $200 million worth of common stock—approximately 3.73 million shares at an average price of $53.55. The company indicated plans to continue repurchases in the second half of the year. At quarter-end, KB Home held $309 million in cash and had $1.19 billion in total liquidity.
Net orders fell 13% to 3,460 units, and backlog homes declined to 4,776 from 6,270. The backlog value dropped 27% to $2.29 billion. Cancellation rates increased to 16%. Average community count rose to 254.
For the full fiscal year, KB Home guided housing revenues between $6.30 billion and $6.50 billion, with average selling prices expected in the $480,000 to $490,000 range. Gross margins are projected between 19.0% and 19.4%, with SG&A expected between 10.2% and 10.6%.
The company stated that although market conditions have softened, it remains committed to optimizing its land position, controlling costs, and returning capital to shareholders, with $450 million remaining under its current share repurchase authorization. Book value per share increased to $58.64, up 10% year-over-year.
KB Home reported a second-quarter performance marked by disciplined cost controls, a strong balance sheet, and aggressive share repurchases, despite year-over-year declines in revenue and net income. Total revenue for the quarter reached $1.53 billion, down from $1.71 billion, with 3,120 homes delivered—a decrease of 11%. The average selling price rose slightly to $488,700.
Net income fell to $107.9 million, translating to $1.50 in diluted earnings per share, compared to $2.15 per share in the same period last year. The company attributed the lower earnings to a combination of fewer home deliveries, price concessions, and reduced leverage on fixed costs. The housing gross margin was 19.3%, or 19.7% on an adjusted basis excluding inventory charges, down from 21.1% a year earlier.
Homebuilding operating income for the quarter was $131.5 million with an 8.6% margin. The financial services segment contributed $8.2 million in pretax income, lower than the $13.3 million in the prior-year period due to weaker performance in the mortgage joint venture.
As part of its capital allocation strategy, the company repurchased $200 million worth of common stock—approximately 3.73 million shares at an average price of $53.55. The company indicated plans to continue repurchases in the second half of the year. At quarter-end, KB Home held $309 million in cash and had $1.19 billion in total liquidity.
Net orders fell 13% to 3,460 units, and backlog homes declined to 4,776 from 6,270. The backlog value dropped 27% to $2.29 billion. Cancellation rates increased to 16%. Average community count rose to 254.
For the full fiscal year, KB Home guided housing revenues between $6.30 billion and $6.50 billion, with average selling prices expected in the $480,000 to $490,000 range. Gross margins are projected between 19.0% and 19.4%, with SG&A expected between 10.2% and 10.6%.
The company stated that although market conditions have softened, it remains committed to optimizing its land position, controlling costs, and returning capital to shareholders, with $450 million remaining under its current share repurchase authorization. Book value per share increased to $58.64, up 10% year-over-year.
