Hovnanian Enterprises Reports Revenue Decline and Net Loss in Q2 Fiscal 2026

Hovnanian Enterprises, Inc. reported a decline in financial performance for the second quarter of fiscal 2026, with total revenues of $667.6 million, down 2.7% from $686.5 million in the same period last year. The decrease was primarily driven by a 7.1% drop in home sales revenue, which fell to $604.2 million from $650.3 million. The company experienced an 11.8% decrease in home deliveries, although this was partially offset by a 5.3% increase in the average sales price per home. For the six months ended April 30, 2026, total revenues were $1.3 billion, a 4.4% decrease compared to $1.36 billion in the prior year.

The company's net loss attributable to Hovnanian Enterprises, Inc. was $0.3 million for the three months ended April 30, 2026, compared to a net income of $19.7 million in the same period last year. For the six months, the net income decreased to $20.6 million from $47.9 million. The decline in profitability was attributed to increased incentives and concessions offered to buyers, including mortgage interest rate buydowns, which were necessary to maintain sales in a challenging market characterized by high mortgage rates and affordability issues.

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 the company's consolidated financial statements. This acquisition resulted in a $31.7 million increase in goodwill on the balance sheet. The company also reported a notable increase in customer deposits, which rose to $206.1 million, reflecting the stage payments received as homes are constructed.

Operationally, Hovnanian's domestic contract backlog decreased to 1,613 homes as of April 30, 2026, down from 1,711 homes a year earlier. The dollar value of the backlog also fell by 5.0% to $938.4 million. Despite these challenges, the company reported a 1.0% increase in net domestic contracts for the second quarter, indicating a slight improvement in sales pace. The company continues to focus on managing inventory levels and aligning construction starts with sales pace to mitigate the impact of market fluctuations.

Looking ahead, Hovnanian remains cautious about the economic environment, citing ongoing uncertainties related to inflation, interest rates, and geopolitical events. The company plans to leverage its liquidity, which stood at $442 million as of April 30, 2026, to support its operations and strategic initiatives. Hovnanian's management emphasized the importance of maintaining flexibility in its capital structure to navigate the evolving market conditions effectively.