First Quarter 2025 Highlights – comparisons to the prior year quarter
- Net earnings per diluted share of $1.96 ($2.14, excluding mark-to-market losses on technology investments)
- Net earnings of $520 million
- New orders increased 1% to 18,355 homes; new orders dollar value decreased 4% to $7.4 billion
- Backlog of 13,145 homes with a dollar value of $5.8 billion
- Deliveries increased 6% to 17,834 homes
- Total revenues of $7.6 billion
- Homebuilding operating earnings of $809 million
- Gross margin on home sales of 18.7% (18.8% before purchase accounting)
- S,G&A expenses as a % of revenues from home sales of 8.5%
- Net margin on home sales of 10.2%
- Financial Services operating earnings of $143 million
- Multifamily operations were breakeven
- Lennar Other operating loss of $89 million
- Homebuilding cash and cash equivalents of $2.3 billion
- Years supply of owned homesites of 0.2 years, lowest in the Company’s history
- Controlled homesites of 98%, highest in the Company’s history
- No outstanding borrowings under the Company’s $3.0 billion revolving credit facility
- Homebuilding debt to total capital of 8.9%
- Repurchased 5.2 million shares of Lennar common stock for $703 million
- Completed spin-off of Millrose Properties, Inc. on February 7th
- Completed acquisition of Rausch Coleman Homes’ homebuilding operations on February 10th
Lennar Corporation (NYSE: LEN and LEN.B), today reported results for its first quarter ended February 28, 2025. First quarter net earnings attributable to Lennar in 2025 were $520 million, or $1.96 per diluted share, compared to first quarter net earnings attributable to Lennar in 2024 of $719 million, or $2.57 per diluted share. Excluding mark-to-market losses on technology investments, first quarter net earnings attributable to Lennar in 2025 were $567 million, or $2.14 per diluted share, compared to first quarter net earnings attributable to Lennar in 2024 were $723 million or $2.58 per diluted share.
Stuart Miller, Executive Chairman and Co-Chief Executive Officer of Lennar, said, “We are pleased to report our 2025 first quarter results that were both constructive and strategic for Lennar. During the quarter, we continued to focus on our strategy of matching production pace with sales pace and maintaining even flow production. Additionally, during the quarter we distributed shares of Millrose Properties, Inc. (“Millrose”) to our shareholders, furthering our asset-light strategy. Finally, we completed the purchase of Rausch Coleman Homes, which expanded our footprint into both new and existing markets in an asset-light manner.”
“In our first quarter, we delivered 17,834 homes, above the high end of our guidance, and recorded new orders of 18,355 homes which also exceeded the high end of our guidance, as we continued to focus matching production pace with sales pace and maintaining even flow production. Accordingly, we ended the quarter with limited inventory of two completed, unsold homes per community, which was within our historical range.”
“Reflecting continued weakness in the market, however, our average sales price, net of incentives, declined to $408,000, 1% lower than last year. Additionally, our gross margin was 18.7%, just shy of our guidance, and our SG&A expenses were 8.5%, producing a 10.2% net margin, all contributing to earnings of $520 million, or $1.96 per diluted share.”
“Our first quarter was marked by a challenging macroeconomic environment for homebuilding. While demand remains strong, persistently higher interest rates and inflation, combined with a downturn in consumer confidence and a limited supply of affordable homes, made it increasingly difficult for consumers to access homeownership.
“We continued to use incentives, including interest rate buydowns, to reconcile home prices to market conditions. These incentives bridged affordability to activate sales and manage inventory, while continuing to provide supply to the market. Generally speaking, net prices for homes, together with rents in overbuilt apartment markets, have started to decline, as demand remains constrained by affordability.”
“During the quarter, we also constructively allocated capital, while we continued to strengthen and fortify our balance sheet. We repurchased $703 million of our common stock, we distributed shares of Millrose to our shareholders and issued our regular dividend. We ended the quarter with no outstanding borrowings on our $3.0 billion revolving credit facility, cash of $2.3 billion, and with homebuilding debt to total capital of 8.9%. Our balance sheet remains extremely strong.”
Jon Jaffe, Co-Chief Executive Officer and President of Lennar, said, “Operationally, our starts pace and sales pace were 4.0 homes and 4.1 homes per community, respectively, in the first quarter, as we continue to move closer to an even flow operating model. Our cycle time was down to 137 days, or 11% lower year over year, as our production-first focus has positively impacted our production times, while our inventory turn improved to 1.7 times, compared to 1.5 last year, reflecting broader efficiencies.”
“As we completed the migration to our land light strategy with the spin-off of Millrose during the first quarter, our years supply of owned homesites improved to 0.2 years from 1.3 years last year, and our controlled homesite percentage increased to 98% from 77% year over year, resulting in a return on inventory of 29.7%.”
Mr. Miller concluded, “Despite an uncertain macro environment, we are optimistic about our business and remain focused on our mission of building a healthier housing market and bringing attainable homes to more people. As we look ahead, we expect to deliver between 19,500 to 20,500 homes for the second quarter and expect our gross margin to be approximately 18%, depending on market conditions. We remain steadfast in our goals to match our production with sales pace, drive strong current cash flow, and maintain carefully managed inventory levels so that, as market conditions stabilize and ultimately improve, we will benefit from normalized margins across our growing volume.”
