Third Quarter 2026
Filed Sep 16, 2026Lennar reported third quarter 2026 net earnings attributable to Lennar of $284 million, or $1.19 per diluted share, as total revenues were $8.0 billion and new orders decreased 9% to 20,879 homes.
Net earnings attributable to Lennar declined to $284 million from $591 million, total revenues declined to $8.0 billion from $8.8 billion, new orders decreased 9%, home sales gross margin declined to 15.8% from 17.5%, and the company reduced its full-year 2026 delivery target to approximately 80,000 to 81,000 homes from 82,000 to 83,000 homes.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenues (In thousands)GAAP | $ 8,046,119 | – | – |
| Homebuilding revenues (In thousands)GAAP | $ 7,759,497 | – | decreased 6% |
| Revenues from home salesGAAP | $7.7 billion | – | decreased 6% |
| Financial Services revenues (In thousands)GAAP | $ 226,121 | – | – |
| Multifamily revenues (In thousands)GAAP | $ 38,475 | – | – |
| Lennar Other revenues (In thousands)GAAP | $ 22,026 | – | – |
| Gross margins on home salesGAAP | $1.2 billion, or 15.8% | – | – |
| Selling, general and administrative expensesGAAP | $714 million | – | – |
| S,G&A expenses as a % of revenues from home salesGAAP | 9.2% | – | – |
| Net margin on home salesGAAP | 6.6% | – | – |
| Homebuilding operating earnings (In thousands)GAAP | $ 501,962 | – | – |
| Financial Services operating earnings (In thousands)GAAP | $ 130,316 | – | – |
| Multifamily operating earnings (loss) (In thousands)GAAP | $ (2,869) | – | – |
| Lennar Other operating earnings (loss) (In thousands)GAAP | $ (83,607) | – | – |
| Corporate general and administrative expenses (In thousands)GAAP | $ (137,883) | – | – |
| Charitable foundation contribution (In thousands)GAAP | $ (20,840) | – | – |
| Earnings before income taxes (In thousands)GAAP | $ 387,079 | – | – |
| Provision for income taxes (In thousands)GAAP | $ (101,592) | – | – |
| Effective income tax rateGAAP | 26.4% | – | – |
| Net earnings (including net earnings attributable to noncontrolling interests) (In thousands)GAAP | $ 285,487 | – | – |
| Net earnings attributable to LennarGAAP | $284 million | – | – |
| Basic and diluted earnings per shareGAAP | $1.19 | – | – |
| Net earnings attributable to Lennar excluding mark-to-market losses on technology investments and one-time items in Financial Servicesnon-GAAP | $294 million | – | – |
| Net earnings per diluted share excluding mark-to-market losses on technology investments and one-time items in Financial Servicesnon-GAAP | $1.23 | – | – |
| Basic and diluted average shares outstanding (In thousands)GAAP | 237,756 | – | – |
| Interest incurred related to homebuilding debt (In thousands)GAAP | $ 63,173 | – | – |
| EBIT (In thousands)non-GAAP | $ 444,639 | – | – |
| New ordersother | 20,879 homes | – | decreased 9% |
| Deliveriesother | 20,840 homes | – | decreased 3% |
| Average sales price of homes deliveredother | $372,000 | – | decreased 3% |
| New-order average sales priceother | $359,000 | – | – |
| Backlogother | 16,857 homes with a dollar value of $6.3 billion | – | – |
| Backlog average sales priceother | $376,000 | – | – |
| Active communitiesother | 1,713 | – | – |
| Starts pace and sales paceother | 4.1 homes per community per month | – | – |
| Construction cost per square footother | improved another 1% sequentially, 6% year over year, and 14% since our fourth quarter 2023 baseline | improved another 1% sequentially | 6% year over year |
| Cycle timeother | 116 days | – | – |
| Completed, unsold inventoryother | 1.8 homes per community | – | – |
| Inventory turnother | 2.4 times | – | – |
| Incentivesother | approximately 12.0% | – | – |
| Homebuilding debt (In thousands)GAAP | $ 4,297,251 | – | – |
| Homebuilding debt to total capitalGAAP | 16.6 % | – | – |
| Net homebuilding debt (In thousands)non-GAAP | $ 3,147,136 | – | – |
| Net homebuilding debt to total capitalnon-GAAP | 12.7 % | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| HomebuildingRevenues were lower primarily due to both a 3% decrease in the average sales price of homes and a 3% decrease in the number of home deliveries. | $ 7,759,497 | – | decreased 6% |
| Financial ServicesOperating earnings included one-time items of $39 million, net, primarily related to a litigation accrual reversal resulting from a court judgment. Excluding the one-time items, the decrease in operating earnings was primarily due to lower profit per locked loan and lower lock volume in the mortgage business. | $ 226,121 | – | – |
| MultifamilyOperating loss was $3 million, compared to an operating loss of $16 million in the third quarter of 2025. | $ 38,475 | – | – |
| Lennar OtherOperating loss was primarily driven by mark-to-market losses of $53 million on the Company's technology investments. | $ 22,026 | – | – |
Fourth quarter of 2026 outlook
- Gross margin15.5% - 16.0%
- Operating expensesSG&A as a % of Home Sales: 8.7% - 9.0%
- NoteNew Orders: 19,500 - 20,500
- NoteDeliveries: 22,000 - 23,000
- NoteAverage Sales Price: $370,000 - $380,000
- NoteFinancial Services Operating Earnings: $90 million - $95 million
- NoteFull-year 2026 deliveries: approximately 80,000 to 81,000 homes
Capital returns
- Repurchased 3 million shares of its common stock for $256 million at an average share price of $85.49.
- Redeemed $400 million of 5.25% senior notes due June 2026.
What drove it
- The company maintained volume and production while navigating a challenging economic environment.
- Mortgage rates increased through the quarter, with the 30-year rate at approximately 6.8% at quarter end.
- Average sales price was $372,000, reflecting approximately 12.0% in incentives and base price adjustments necessary to sustain volume.
- Lower revenue per square foot and higher land costs reduced gross margin year over year, partially offset by lower construction costs.
- Construction cost per square foot improved another 1% sequentially, 6% year over year, and 14% since the fourth quarter 2023 baseline.
- Financial Services profitability was affected by lower profit per locked loan and lower lock volume in the mortgage business.
Concerns
- New orders decreased 9% to 20,879 homes and deliveries decreased 3% to 20,840 homes compared to the prior year.
- Home sales gross margin declined to 15.8% from 17.5%, while SG&A as a percentage of home sales rose to 9.2% from 8.2%.
- The company cited deteriorating market conditions, higher mortgage rates, affordability constraints and lower consumer confidence.
- Lennar Other recorded an $84 million operating loss, primarily driven by $53 million of mark-to-market losses on technology investments.
- The company reduced its target for full-year 2026 deliveries to approximately 80,000 to 81,000 homes from 82,000 to 83,000 homes discussed last quarter.
What to watch
- Fourth-quarter new orders guidance of 19,500 - 20,500 homes.
- Fourth-quarter delivery guidance of 22,000 - 23,000 homes and the updated full-year target of approximately 80,000 to 81,000 homes.
- Whether home sales gross margin is within the guided 15.5% - 16.0% range as incentives and base price adjustments continue.
- Whether SG&A as a percentage of home sales improves toward the guided 8.7% - 9.0%.
- Financial Services operating earnings guidance of $90 million - $95 million.
- The effect of continued pressure on interest rates and affordability on demand, lock volume and pricing.
Balance sheet and cash flow
- Homebuilding cash and cash equivalents were $ 1,150,115 at August 31, 2026, compared to $ 3,441,324 at November 30, 2025.
- Total assets were $ 33,378,225 at August 31, 2026, compared to $ 34,430,437 at November 30, 2025.
- Total liabilities were $ 11,681,805 at August 31, 2026, compared to $ 12,289,828 at November 30, 2025.
- Total stockholders’ equity was $ 21,558,959 at August 31, 2026, compared to $ 21,959,417 at November 30, 2025.
- Outstanding borrowings were $650 million under the Company's $3.1 billion revolving credit facility.
- Of the approximately 488,000 homesites the company owns and controls, it owns fewer than 2.5%, on its balance sheet.
Analysis
Lennar's third-quarter results weakened materially from the prior-year period. Net earnings attributable to Lennar were $284 million, or $1.19 per diluted share, compared with $591 million, or $2.29 per diluted share. Total revenues were $8.0 billion, while homebuilding revenue declined 6% as both deliveries and average delivered home price declined 3%. New orders fell 9% to 20,879 homes, and backlog ended at 16,857 homes with a dollar value of $6.3 billion.
The company continued to prioritize volume and production despite a more difficult demand environment. It delivered 20,840 homes, within its prior delivery guidance of 20,500 to 21,500 homes, and reported starts pace and sales pace of 4.1 homes per community per month across 1,713 active communities. Management attributed pricing pressure to affordability constraints, with an average sales price of $372,000 reflecting approximately 12.0% in incentives and base-price adjustments.
Margins remained under pressure even as operating execution improved. Home sales gross margin was 15.8%, compared with 17.5% a year earlier, reflecting lower revenue per square foot and higher land costs, partly offset by reduced construction costs. SG&A increased to 9.2% of home sales revenue from 8.2%, which the company attributed to lower revenue leverage and increased marketing and selling expense. Construction cost per square foot improved another 1% sequentially, cycle time reached 116 days, and completed unsold inventory declined to 1.8 homes per community from 2.1 homes per community last quarter.
Financial Services operating earnings were $129 million in the release highlights and included one-time items of $39 million, net, primarily related to a litigation accrual reversal. Excluding those items, management cited lower profit per locked loan and lower lock volume in the mortgage business. Lennar Other moved to an $84 million operating loss, primarily due to $53 million of mark-to-market losses on technology investments, compared with technology-investment gains in the prior-year quarter.
Capital allocation included repurchases of 3 million common shares for $256 million and redemption of $400 million of senior notes. Homebuilding cash and cash equivalents were $1.2 billion, homebuilding debt to total capital was 16.6%, and net homebuilding debt to total capital was 12.7%. For the fourth quarter, Lennar guided to 19,500 - 20,500 new orders, 22,000 - 23,000 deliveries, a $370,000 - $380,000 average sales price, and 15.5% - 16.0% gross margin. The company also moderated its full-year 2026 delivery target to approximately 80,000 to 81,000 homes from 82,000 to 83,000 homes discussed last quarter.
Management, verbatim
Our third quarter 2026 results reflect consistent focus on our operating strategy of maintaining volume and production while navigating a challenging economic environment. While our earnings of $1.19 per share were below expectations, they reflect the nature of the environment in which we are operating, which has deteriorated since our last earnings call.
Stuart Miller, Executive Chairman, Chief Executive Officer and President
By maintaining volume, we have improved execution across numerous key metrics. Our construction cost per square foot improved another 1% sequentially, 6% year over year, and 14% since our fourth quarter 2023 baseline. Our cycle time reached a new record low of 116 days, down from 121 days last quarter and 126 days a year ago.
Stuart Miller, Executive Chairman, Chief Executive Officer and President
Looking ahead to the fourth quarter of 2026, we expect to generate new orders of approximately 19,500 to 20,500 homes, and to deliver approximately 22,000 to 23,000 homes with gross margin of approximately 15.5% to 16.0%.
Stuart Miller, Executive Chairman, Chief Executive Officer and President
Not in the filing
stated, not guessed- Operating cash flow was not reported.
- Free cash flow was not reported.
- Dividend declaration or payment information was not reported.
- Total company debt was not separately reported.
- Prior-quarter total revenue, segment revenue, earnings, EPS, operating income and cash-flow comparisons were not reported on the applicable line items.
- Fourth-quarter revenue guidance was not reported.
- Fourth-quarter tax-rate guidance was not reported.
- Prior-release outlook was not provided, so no formal comparison of actual results with prior guidance is included.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.