Lennar Corporation, one of the nation’s leading homebuilders, has reported its financial results for the first quarter of 2025. The company delivered 17,834 homes, marking a 6% increase compared to the same period last year, and achieved net earnings of $520 million, or $1.96 per diluted share. This is a decrease from the prior year’s net earnings of $719 million, or $2.57 per diluted share. Excluding mark-to-market losses from technology investments, the adjusted net earnings were $567 million, or $2.14 per diluted share.

Lennar’s total revenues reached $7.6 billion, reflecting a 4% increase. The average sales price for homes sold decreased year-over-year to $408,000, representing a 1% decline. New orders increased slightly by 1% to 18,355 homes, although the dollar value of new orders decreased by 4% to $7.4 billion. The backlog as of the quarter’s end stood at 13,145 homes, valued at $5.8 billion.

Gross margins on home sales were recorded at 18.7%, down from 21.8% a year prior. The decline in margin is attributed to rising land costs and pressures from sales incentives, which averaged around 13% in the first quarter. Selling, general, and administrative (SG&A) expenses increased to 8.5% of revenues from 8.2% the previous year.

In terms of operational efficiency, Lennar reported an average construction cycle time of 137 days, a reduction of 11% from the previous year. The company has improved its inventory turn to 1.7 times, up from 1.5 times last year. Cash and cash equivalents at the end of the quarter totaled $2.3 billion, with no outstanding borrowings under its $3.0 billion revolving credit facility, reflecting a strong balance sheet.

Looking ahead, Lennar expects second-quarter new orders to fall within the range of 22,500 to 23,500 homes, with expected deliveries between 19,500 to 20,500 homes. The company anticipates an average sales price for these deliveries to range from $390,000 to $400,000 and a gross margin of approximately 18%, which does not include the effects of purchase accounting impacts associated with the ongoing Rausch Coleman acquisition. SG&A expenses are forecasted to be between 8.0% and 8.2% of revenues.

This period also saw significant strategic activity, including the completion of the spin-off of Millrose Properties, which involved distributing a $5.6 billion land asset value to shareholders, and the acquisition of Rausch Coleman Homes. Following these integrations, the years supply of owned homesites is at 0.2 years, and 98% of homesites are now under control, both historical lows for the company.

Overall, while Lennar has navigated a challenging market characterized by high interest rates and decreased consumer confidence, it has focused on maintaining production efficiencies and a strong balance sheet, laying the groundwork for future growth.