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Toll Brothers reported strong financial performance in the third quarter of fiscal year 2025 despite challenging market conditions. The company delivered 2,959 homes at an average price of $974,000, resulting in record home sale revenues of $2.9 billion. Despite a 4% year-over-year decline in unit sales, the luxury home builder maintained a stable financial footing, returning $226 million to stockholders through dividends and share repurchases. The call highlighted the impending retirement of CFO Marty Connor, with Greg Ziegler set to assume the role, ensuring a smooth transition of leadership. Toll Brothers maintained its guidance metrics, expecting to deliver 3,350 homes in the fourth quarter, with an average sales price between $970,000 and $980,000. Strategic focus continues on managing spec home inventory and growth, especially in strong regions such as the North and Mid-Atlantic, while the company aims to capitalize on improving market sentiment. During the Q&A, analysts raised questions about cash flow operations and construction cost trends, which the management addressed by indicating cost control measures and leveraging efficiencies in their home building operations. The management expressed confidence in maintaining strong financial results through community growth and leveraging a resilient luxury market segment.
Marty Connor plans to retire as CFO in October after a 17-year tenure.
Toll Brothers delivered 2,959 homes at an average price of $974,000.
Toll Brothers achieved record third quarter home sale revenues of $2.9 billion.
The company returned $226 million to stockholders through dividends and share repurchases in Q3.
Despite market softness, Toll maintains a full year delivery expectation of 11,200 homes.
Cancellation rate remains low at 3.2% of beginning backlog, the lowest in the industry.
26% of Toll's buyers paid all cash in Q3, highlighting strong customer financial profiles.
Toll Brothers successfully refinanced senior notes, with no significant maturities until March 2027.
Full year average delivered price expected between $950,000 and $960,000.
Traffic is up, both web and foot, indicating improving market sentiment.
Revenue
$2.9 billion
Record for Q3
Adjusted Gross Margin
27.5%
Exceeded guidance by 25 basis points
SG&A Expense
8.8%
40 basis points better than guidance
Earnings
$370 million
N/A
Earnings Per Share
$3.73 per diluted share
N/A
Net Contracts
2,388
-4% YoY
Average Sales Price
$1 million
+4.5% YoY