$LEN · LENNAR CORP /NEW/
Lennar reported Q3 FY2026 results with net earnings of $284 million ($1.19 per diluted share), down sharply from $591 million ($2.29) a year ago. Home sales revenue fell 6% to $7.7 billion on 20,840 deliveries at an average price of $372,000. Gross margin on home sales compressed to 15.8% from 17.5% YoY. The company cut its full-year 2026 delivery target to 80,000-81,000 homes from 82,000-83,000 and guided Q4 gross margins to 15.5%-16.0%.
- Q3 EPS of $1.19 ($1.23 adjusted) vs $2.29 prior year — a 48% YoY decline.
- Home sales revenue fell 6% to $7.7B on 3% lower deliveries and 3% lower ASP of $372,000.
- Gross margin on home sales contracted to 15.8% from 17.5% YoY; SG&A rose to 9.2% from 8.2%.
- Full-year 2026 delivery guidance cut to 80,000-81,000 homes from prior 82,000-83,000.
- Q4 gross margin guided to 15.5%-16.0% with ASP of $370,000-$380,000 — continued compression.
Stock fell 2.14% in the regular session to $78.36 ahead of the release. After-hours trading is underway; the guidance cut and margin compression suggest further pressure. At $19.46B market cap, the delivery guide-down and EPS miss are material.
Lennar's guidance cut and margin erosion at the No. 2 U.S. homebuilder signals that high mortgage rates are inflicting deeper damage on housing demand than previously expected.
Lennar's volume-over-price strategy mirrors broader homebuilder tradeoffs in a high-rate environment. The delivery guide cut and margin compression at the nation's second-largest builder signals affordability headwinds are intensifying across the sector.
Management flagged deteriorating market conditions since last earnings, with 30-year mortgage rates at ~6.8% and rising, declining consumer confidence, and affordability as "the defining constraint." Incentives at ~12.0% of ASP signal pricing power erosion.
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