0001574197-26-000020
SEC filingRevenue grew modestly year-over-year, but net income swung to a loss and operating cash flow turned significantly negative as the company scaled management services at its new Hearthstone segment — a strategic shift toward capital-light operations without active land development this quarter.
Revenue for the three months ended March 31, 2026 totaled $13.6 million, an increase of 3.2% compared to $13.2 million in the prior-year period. This growth was primarily attributable to management services revenue recognized at the new Hearthstone segment, partially offset by a decrease in management services revenue at the Great Park segment. The shift reflects the company’s ongoing strategic emphasis on recurring, capital-light management services rather than land sales or development.
Net income declined to a loss of $2.2 million, compared to income of $23.3 million in the prior-year quarter. This swing was driven primarily by the cost of management services recognized at the Hearthstone segment, partially offset by a decrease in intangible asset amortization expense at Great Park. Additionally, the effective tax rate increased slightly due to a higher disallowance of executive compensation expenses not deductible for tax purposes — a non-cash item that affects reported earnings but not cash flow.