D.R. Horton Reports 15% Revenue Decline and 31% Drop in Net Income for Q2 Fiscal 2025

D.R. Horton, Inc. reported a decline in financial performance for the second quarter of fiscal 2025, with consolidated revenues of $7.73 billion, down 15% from $9.11 billion in the same period last year. The company's net income attributable to D.R. Horton decreased by 31% to $810.4 million, resulting in diluted earnings per share of $2.58, compared to $3.52 in the prior year. For the first six months of the fiscal year, revenues totaled $15.35 billion, a 9% decrease from $16.83 billion, while net income fell to $1.67 billion from $2.14 billion in the previous year.

The decrease in revenue and profitability was attributed to a slowdown in home sales, with the number of homes closed dropping by 15% to 19,276 in the second quarter. The average closing price of homes also saw a slight decline of 1%, settling at $372,500. The company reported a 15% decrease in net sales orders, valued at $8.4 billion, reflecting ongoing affordability challenges and declining consumer confidence in the housing market. The sales order backlog decreased by 21% to 14,164 homes, indicating a significant reduction in future sales expectations.

In terms of operational developments, D.R. Horton continues to manage its inventory strategically, with total homebuilding inventories reaching $20.91 billion as of March 31, 2025, compared to $20.03 billion at the end of September 2024. The company has focused on maintaining relationships with land developers, with 75% of its lots controlled through purchase contracts. The homebuilding segment employed 10,199 people as of March 31, 2025, an increase from 9,717 a year earlier, reflecting the company's commitment to enhancing operational capacity.

Looking ahead, D.R. Horton anticipates continued challenges in the housing market, particularly as it relates to consumer demand and pricing strategies. The company plans to remain flexible with its lot supply and pricing, adjusting sales incentives as necessary to attract buyers. The management expressed confidence in its strong balance sheet and liquidity, which it believes will provide the necessary support to navigate the current economic conditions and optimize returns on inventory investments. The company is also focused on maintaining its competitive position through strategic investments and operational efficiencies.