Hovnanian Enterprises Reports Decline in Revenue and Net Loss for Third Quarter of Fiscal 2026

Hovnanian Enterprises, Inc. reported a decline in financial performance for the third quarter and first nine months of fiscal 2026, as detailed in its latest 10-Q filing. For the three months ended July 31, 2026, the company generated total revenues of $705.7 million, a decrease of 11.8% from $800.6 million in the same period of the previous year. The sale of homes accounted for $679.0 million, down from $769.1 million, primarily due to a 12.0% drop in home deliveries. The net loss attributable to common stockholders was $4.5 million, or $0.70 per diluted share, compared to a profit of $13.9 million, or $1.99 per diluted share, in the prior year.

In comparison to the previous fiscal period, Hovnanian's revenues for the nine months ended July 31, 2026, also fell to $2.0 billion from $2.2 billion, reflecting a 7.2% decrease. The company noted a significant reduction in home deliveries, which contributed to the decline in revenues. Additionally, gross margin percentages decreased, with homebuilding gross margin at 11.8% for the quarter and 10.8% for the nine months, down from 11.7% and 13.5%, respectively, in the prior year. The company attributed these declines to increased incentives and concessions offered to buyers in response to challenging market conditions.

Strategically, Hovnanian made significant moves during the quarter, including the acquisition of a controlling interest in a previously unconsolidated joint venture in the Kingdom of Saudi Arabia, which is now included in its consolidated financial statements. This acquisition resulted in a $31.7 million increase in goodwill on the balance sheet. The company also reported an increase in customer deposits, which rose to $235.4 million, largely due to stage payments received from the KSA operations.

Operationally, Hovnanian's domestic contract backlog increased to 1,509 homes valued at $881.9 million as of July 31, 2026, a 5.1% increase in dollar value compared to the previous year. However, net domestic contracts decreased by 4.6% for the quarter and remained relatively flat for the nine-month period, reflecting cautious buyer behavior amid high mortgage rates and economic uncertainty. The company continues to focus on driving sales pace rather than price, utilizing quick move-in homes to meet buyer demand.

Looking ahead, Hovnanian remains cautious about the housing market, citing ongoing challenges such as inflation, geopolitical instability, and fluctuating interest rates. The company plans to continue leveraging its cash position and available credit to finance operations and pursue growth opportunities, while also managing its inventory levels in response to market conditions.