Toll Brothers (TOL) Q3 2026 Earnings Call Transcript

US new-home sales fell 10.5% in July to a 607,000 annual rate, below economist expectations. Median home price dropped 0.9% to $393,800. DR Horton expects lower sales, while Toll Brothers saw contract increases. Inventory decreased 1.6% to 488,000 homes. Sales varied regionally, with declines in the South and Midwest. Data is volatile but seen as a timely market indicator.

Toll Brothers (TOL) reported Q3 revenue of $2.66B, down 9.7%, with EPS of $2.97, beating estimates. Deliveries fell to 2,662 homes, but average price rose to $996,400. The company reaffirmed full-year targets, including $10.5B in revenue and 10,500-10,600 deliveries. Shares rose in after-hours trading.

Toll Brothers reported Q3 2026 earnings, highlighting resilience in luxury move-up segment, which accounts for 61% of revenue. The company reduced finished spec inventory to 1.9 homes per community and expects 8% to 10% community count growth. Fiscal 2026 guidance includes a backlog of 2,700 homes and a share repurchase projection of $700 million. Management noted stable margins despite elevated incentives and modest lumber cost increases.

U.S. stocks rose after the Treasury announced plans to double purchases of longer-term Treasurys, easing bond market pressure. The S&P 500 gained 0.2%, ending a 3-day losing streak. Strong earnings from Estee Lauder, Target, and others also supported gains. Moderna and Merck surged on positive cancer vaccine trial results. The 10-year Treasury yield fell to 4.64% from 4.71%.

Toll Brothers (TOL) stock rose 4% to $148.58 after Q3 earnings of $2.98 EPS on $2.66B revenue. Despite a 1.5% decline in net profit margin to 11.1%, investors focused on adjusted gross margin beating guidance. Revenue and net income fell 9.7% and 24.2% YoY, respectively, raising concerns about luxury demand and cost pressures.

Toll Brothers reported Q3 revenue of $2.66B, down from $2.95B YoY, with net income of $280.1M, down from $369.6M. The company delivered 2,662 homes, with an average price of $996,400. Toll reaffirmed its full-year guidance, expecting 10,500-10,600 home deliveries at an average price of $995,000-$1M. Executives noted a challenging market but expressed optimism about future improvements.