Quarterly report [Sections 13 or 15(d)]

OPERATING AND REPORTING SEGMENTS

v3.25.1
OPERATING AND REPORTING SEGMENTS
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
OPERATING AND REPORTING SEGMENTS OPERATING AND REPORTING SEGMENTS
We operate with two principal business segments: homebuilding and financial services. As defined in ASC 280-10, Segment Reporting, we have twelve homebuilding operating segments. The homebuilding segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes and providing warranty and customer services. We aggregate our homebuilding operating segments into reporting segments based on similar long-term economic characteristics and geographical proximity. Our three reportable homebuilding segments are as follows:
West:
Arizona, California, Colorado and Utah
Central:
Tennessee and Texas
East:
Alabama, Florida, Georgia, Mississippi, North Carolina, and South Carolina
We define our segments based on the way in which internally reported financial information is regularly provided and reviewed by the CODM to analyze financial performance, make decisions, and allocate resources. Our CODM is the chief executive officer. The CODM’s evaluation of the homebuilding segment performance is based on segment home closing revenue, home closing gross profit/(loss), home closing gross margin, total gross profit/(loss), commissions and other sales costs, general and administrative costs incurred by or allocated to each segment, including impairments, and operating income/(loss). The CODM uses these performance metrics predominantly in the annual budget and forecasting process and considers budget-to-actual variances on a quarterly basis for these measures when making decisions about the allocation of operating and capital resources to each segment. The CODM also uses these data points to assess the performance of each segment by comparing the results of each segment with one another and in determining the compensation of certain employees. The CODM also reviews financial services profit/(loss) to evaluate the performance of the financial services segment and make decisions about allocation of resources and financial services related product offerings.
Effective January 1, 2025, we realigned our internal organizational structure and resources following continued growth and recent entry into new markets. As a result of the change in our organizational structure, the Tennessee homebuilding operating segment was reclassified from the East reporting segment to the Central reporting segment for the purpose of making
operational and resource decisions and assessing financial performance. Prior period balances have been retroactively adjusted to reflect this reclassification.
Each reportable segment follows the same accounting policies described in Note 1, “Organization and Basis of Presentation.” Operating results for each segment may not be indicative of the results for such segment had it been an independent, stand-alone entity for the periods presented.
The following tables provide financial information about our reportable segments and Corporate and other categories (in thousands):  
Three Months Ended March 31, 2025
West Central East Total
Home closing revenue $ 479,636  $ 412,537  $ 449,931  $ 1,342,104 
Land closing revenue 691  930  13,800  15,421 
Total closing revenue 480,327  413,467  463,731  1,357,525 
Cost of home closings 374,665  321,808  349,981  1,046,454 
Cost of land closings 142  335  11,779  12,256 
Total cost of closings 374,807  322,143  361,760  1,058,710 
Home closing gross profit 104,971  90,729  99,950  295,650 
Land closing gross profit 549  595  2,021  3,165 
Total closing gross profit 105,520  91,324  101,971  298,815 
Home closing gross margin 21.9% 22.0% 22.2% 22.0%
Commissions and other sales costs 27,402  32,657  34,661  94,720 
General and administrative expenses 13,453  12,839  18,092  44,384 
Homebuilding segment operating income 64,665  45,828  49,218  159,711 
Financial services segment profit 3,563 
Corporate and unallocated costs (1) (12,613)
Interest expense — 
Other income, net 9,498 
Earnings before income taxes $ 160,159 

(1)Balance consists primarily of corporate costs and shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.
Three Months Ended March 31, 2024
West Central East Total
Home closing revenue $ 515,632  $ 483,770  $ 466,694  $ 1,466,096 
Land closing revenue —  —  2,305  2,305 
Total closing revenue 515,632  483,770  468,999  1,468,401 
Cost of home closings $ 400,504  $ 350,371  $ 337,263  $ 1,088,138 
Cost of land closings —  —  2,298  2,298 
Total cost of closings 400,504  350,371  339,561  1,090,436 
Home closing gross profit 115,128  133,399  129,431  377,958 
Land closing gross profit —  —  7  7 
Total closing gross profit 115,128  133,399  129,438  377,965 
Home closing gross margin 22.3% 27.6% 27.7% 25.8%
Commissions and other sales costs 31,158  37,245  33,147  101,550 
General and administrative expenses 12,706  11,383  13,682  37,771 
Homebuilding segment operating income 71,264  84,771  82,609  238,644 
Financial services segment loss (690)
Corporate and unallocated costs (1) (12,961)
Interest expense — 
Other income, net 9,022 
Earnings before income taxes $ 234,015 

(1)Balance consists primarily of corporate costs and shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.

  At March 31, 2025
  West Central East Financial Services Corporate  and
Unallocated		 Total
Deposits on real estate under option or contract $ 30,720  $ 99,446  $ 124,380  $ —  $ —  $ 254,546 
Real estate 1,872,979  1,608,310  2,319,665  —  —  5,800,954 
Investments in unconsolidated entities 9,417  20,969  —  —  902  31,288 
Other assets 47,685  (1) 300,828  (2) 97,697  (3) 2,183  1,165,037  (4) 1,613,430 
Total assets $ 1,960,801  $ 2,029,553  $ 2,541,742  $ 2,183  $ 1,165,939  $ 7,700,218 

(1)Balance consists primarily of cash and cash equivalents, development reimbursements from local municipalities, and property and equipment, net.
(2)Balance consists primarily of cash and cash equivalents, development reimbursements from local municipalities, goodwill (see Note 9), and prepaids and other assets.
(3)Balance consists primarily of cash and cash equivalents, goodwill (see Note 9), and prepaids and other assets.
(4)Balance consists primarily of cash and cash equivalents, deferred tax assets and prepaids and other assets.
  At December 31, 2024
  West Central East Financial Services Corporate  and
Unallocated		 Total
Deposits on real estate under option or contract $ 30,179  $ 32,200  $ 130,026  $ —  $ —  $ 192,405 
Real estate 1,862,792  1,613,735  2,252,248  —  —  5,728,775 
Investments in unconsolidated entities 9,062  18,816  —  —  857  28,735 
Other assets 28,251  (1) 270,203  (2) 91,082  (3) 3,049  820,154  (4) 1,212,739 
Total assets $ 1,930,284  $ 1,934,954  $ 2,473,356  $ 3,049  $ 821,011  $ 7,162,654 
(1)Balance consists primarily of property and equipment, prepaid expenses and other assets, and development receivables.
(2)Balance consists primarily of development reimbursements from local municipalities, property and equipment, goodwill (see Note 9), and prepaid expenses and other assets.
(3)Balance consists primarily of cash and cash equivalents, goodwill (see Note 9), and prepaids and other assets.
(4)Balance consists primarily of cash and cash equivalents, deferred tax assets, prepaid expenses and other assets.