Taylor Morrison Home Corporation

Q1 reported net income was $99 million, or $1.01 per diluted share; adjusted net income was $109 million, or $1.12 per diluted share. Home closings revenue was approximately $1.3 billion from 2,268 homes delivered at an average price of $578,000, and adjusted home closings gross margin was 20.6% (reported gross margin 20%). Versus Q1 2025, reported net income was down from $213 million and adjusted EPS was down from $2.19; revenue was down from $1.8 billion. Net orders were 2,914, down 14% year over year, and SG&A was $149 million, or 11.4% of home closings revenue. For Q2, management guided to 2,500-2,600 closings, average closing price of about $575,000, and home closing gross margin of at least 20% excluding inventory-related charges. Full-year 2026 guidance was reaffirmed for about 11,000 home closings, average closing price of $580,000-$590,000, ending communities of 365-370, SG&A in the mid-10% range, a tax rate of about 25%, about $2 billion of land investment, and about $400 million of share repurchases.

Sheryl Palmer framed the quarter as evidence that Taylor Morrison’s diversified strategy and core-market focus are working, especially through stronger to-be-built demand and better pricing discipline. She highlighted record design-center attendance, more than a dozen AI applications in production, and technology investments that are improving customer engagement without increasing technology spend. Her tone was confident but measured: she repeatedly acknowledged consumer caution, higher mortgage rates, and macro uncertainty, while stressing that the company is positioning for reacceleration in 2027 and beyond.

Curt VanHyfte said Q1 margin came in above guidance because of favorable costs and mix, including more closings in higher-margin divisions and more to-be-built closings than planned. He also emphasized disciplined capital allocation: $503 million invested in land and development in Q1, $150 million used for share repurchases, $653 million of cash, no revolver borrowings, total liquidity of about $1.6 billion, and net homebuilding debt to capitalization of 20.5%. He guided to gradual margin improvement in the second half, assuming stable construction costs with mid-single-digit lot cost inflation, and noted net interest expense of $11.2 million reflected land banking activity.

Analysts focused on the expected margin cadence, incentive trends, starts timing, second-half delivery mix, and whether Taylor Morrison was losing share by favoring price over pace. Management said Q2 margin should step down versus Q1 because the mix benefits in Q1 reverse, while the back half should see gradual improvement as to-be-built mix rises and spec inventory clears. On incentives, Sheryl said the 100 basis point sequential reduction reflected better mix and more disciplined pricing, and Curt said new-home and resale inventory appear to be stabilizing. They also said starts will generally align with sales going forward, with later starts possible thanks to shorter cycle times.