Wed, Apr 23, 6:10 PM (19 days ago)
### D.R. Horton, Inc. (DHI) Q1 2025 Financial Summary **Overview:** D.R. Horton, Inc. (DHI) reported a mixed performance for the quarter ending March 31, 2025. The company faced challenges due to affordability constraints and declining consumer confidence, leading to slower new home demand. Despite these headwinds, DHI remains focused on managing its inventory and pricing strategies to optimize returns. **Financial Performance:** - **Revenue:** Consolidated revenues decreased by 15% to $7.7 billion compared to $9.1 billion in the prior year. - **Net Income:** Net income attributable to DHI decreased by 31% to $810.4 million from $1.2 billion. - **Earnings per Share (EPS):** Diluted EPS fell by 27% to $2.58 from $3.52. - **Homebuilding Revenues:** Decreased by 15% to $7.2 billion from $8.5 billion. - **Homes Closed:** Decreased by 15% to 19,276 homes from 22,548 homes. - **Average Closing Price:** Decreased by 1% to $372,500 from $375,500. - **Net Sales Orders:** Decreased by 15% to 22,437 homes from 26,456 homes. - **Sales Order Backlog:** Decreased by 21% to 14,164 homes from 17,873 homes. **Segment Performance:** - **Homebuilding:** Pre-tax income decreased by 31% to $935.0 million from $1.4 billion. - **Rental:** Pre-tax income decreased by 31% to $22.8 million from $33.3 million. - **Forestar:** Pre-tax income decreased by 31% to $40.7 million from $58.9 million. - **Financial Services:** Pre-tax income decreased by 6% to $73.0 million from $78.0 million. **Cash Flow and Liquidity:** - **Operating Cash Flow:** Net cash provided by operating activities was $210.5 million, compared to $470.1 million of cash used in operations in the prior year. - **Investing Cash Flow:** Net cash used in investing activities was $94.5 million, compared to $66.0 million in the prior year. - **Financing Cash Flow:** Net cash used in financing activities was $2.1 billion, primarily due to share repurchases and debt repayments. **Strategic Initiatives:** - DHI is focusing on maintaining a strong balance sheet and liquidity to navigate changing economic conditions. - The company is prioritizing the purchase of finished lots from Forestar and other land developers. - DHI is managing home pricing, sales incentives, and inventory levels based on local market conditions. **Outlook:** - DHI expects incentive levels to remain elevated due to market conditions and changes in mortgage interest rates. - The company aims to optimize returns on inventory investments and maintain financial flexibility. **Key Metrics:** - **Debt to Total Capital:** 21.1% compared to 18.9% in the prior quarter. - **Net Debt to Total Capital:** 14.3% compared to 5.2% in the prior quarter. - **Return on Equity (ROE):** 17.4% compared to 22.2% in the prior year. - **Return on Assets (ROA):** 12.2% compared to 15.1% in the prior year. **Conclusion:** D.R. Horton, Inc. faced significant challenges in Q1 2025 due to affordability constraints and declining consumer confidence. However, the company remains focused on strategic initiatives to optimize returns and maintain financial flexibility. The outlook for the remainder of the year will depend on the company's ability to manage inventory and pricing strategies effectively.