D.R. Horton reports a 31% year-on-year drop in net income to $810 million in its fiscal second quarter ended March 31, 2025, down from $1.2 billion the previous year. The number of homes closed in the quarter fell 15% to 19,276, while homebuilding revenues declined to $7.2 billion. Consolidated revenues fell 15% to $7.7 billion and pre-tax income dropped 30% to $1.1 billion. The company’s return on equity stood at 17.4% for the trailing twelve months, with return on assets at 12.2%, according to D.R. Horton.
The weaker results stem from a slower-than-expected spring selling season, which the company attributes to continued affordability constraints and declining consumer confidence. As a result, net sales orders dropped 15% to 22,437 homes, valued at $8.4 billion. Order backlog shrank 21% to 14,164 homes, with Southeast and South Central markets accounting for nearly half the volume decline. To stimulate demand, D.R. Horton increased sales incentives while managing margins, which reached 21.8% for home sales gross profit.
Rental operations generated $23 million in pre-tax income on $237 million in revenues, with 519 single-family homes and 300 multi-family units sold. Financial services delivered $73 million in pre-tax income on $213 million in revenue. Forestar, its lot development arm, sold 3,411 lots and earned $41 million in pre-tax income on $351 million revenue, with margins tightening to 11.6% from 17.6%.
Looking ahead, the company forecasts fiscal 2025 revenues between $33.3 billion and $34.8 billion and expects to close 85,000 to 87,000 homes. Share repurchases are projected to reach $4 billion, and total dividend payments are expected to hit $500 million. Guidance also includes $3 billion or more in operating cash flow.
