Q3 2025 Meritage Homes Corp Earnings Call Transcript
Key Points
- Meritage Homes Corp (MTH) achieved a 4% year-over-year increase in orders to 3,636 units, despite challenging market conditions.
- The company maintained a strong backlog conversion rate of 211%, with over 60% of Q3 orders closing within the quarter.
- Meritage Homes Corp (MTH) reported a 20% year-over-year increase in community count, reaching a record high of 334 communities.
- The company successfully reduced cycle times to approximately 105 days, improving operational efficiency.
- Meritage Homes Corp (MTH) returned $85 million to shareholders in Q3, including $55 million in share repurchases, reflecting a commitment to shareholder value.
- Market conditions were softer than expected, with declining consumer confidence impacting demand.
- The average selling price (ASP) on orders decreased by 4% year-over-year due to increased use of incentives and discounts.
- Home closing revenue in Q3 was 12% lower than the prior year, driven by a 7% decrease in home closing volume and a 5% decrease in ASP.
- Gross margin declined to 19.1% in Q3, down from 24.8% in the previous year, due to higher incentives and inventory-related charges.
- The company experienced a 48% year-over-year decrease in diluted EPS, reflecting lower revenue and higher SG&A expenses.
Greetings. Welcome to the Meritage Homes third-quarter 2025 analyst call. (Operator Instructions) Please note that this conference is being recorded.
I will now turn the conference over to Emily Tadano, VP of Investor Relations and External Communications. Thank you. You may begin.
Thank you, operator. Good morning and welcome to our analyst call to discuss our third-quarter 2025 results. We issued the press release yesterday after the market closed. You can find it along with the slides we'll refer to during this call on our website at investors.meritagehomes.com or by selecting the Investors Relations link at the bottom of our homepage.
Please refer to slide 2, cautioning you that our statements during this call as well as in the earnings release and accompanying slides contain forward-looking statements. Those and any other projections represent the current opinions of management, which are subject to change at any time, and we assume no
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