DFH · Dream Finders Homes, Inc.

Dream Finders Homes reported first quarter 2026 results that reflected a challenging housing environment with elevated mortgage rates and macroeconomic uncertainty. Net sales reached a record 2,408 units, up 19% year-over-year, driven by aggressive pricing and incentive strategies that boosted traffic and absorption. However, these incentives, along with higher land and financing costs, compressed homebuilding gross margin to 14.5% from 19.2% (adjusted gross margin fell to 24.3% from 27.8%). Homebuilding revenues declined 14% to $837 million due to lower average selling prices and a slight drop in closings (1,870 vs 1,925). SG&A decreased 5% but rose as a percentage of revenue to 13.3% due to lower absorption. Net income attributable to DFH plunged to $13 million ($0.11 per diluted share) from $55 million ($0.54), impacted by a higher effective tax rate and a $1 million unrealized loss on investments. Financial services provided a bright spot, with pre-tax income up 33% to $9 million, benefiting from the Alliant Title acquisition and hedging strategies. The cancellation rate improved significantly to 7.5% from 11.7%, underscoring the effectiveness of sales incentives. Management reiterated full-year 2026 guidance of approximately 9,250 home closings, expressing confidence in the company's disciplined approach and scalable platform. The company also repurchased 1.06 million shares for $18 million during the quarter. Overall, the results highlight a trade-off between volume and profitability as the company navigates a tough market.