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Earnings analysis · 10-Q

TMHC earnings analysis

Filed April 22, 2026 · Our reading of the company's report

The latest report

Taylor Morrison reported Q1 revenue of $1,387,092,000 and diluted EPS of $1.01 for the three months ended March 31, 2026, with revenue and profitability meaningfully below the prior-year quarter. Gross margin contracted…

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Taylor Morrison reported Q1 revenue of $1,387,092,000 and diluted EPS of $1.01 for the three months ended March 31, 2026, with revenue and profitability meaningfully below the prior-year quarter. Gross margin contracted to 20.96% and operating margin to ~10.01% versus Q1 2025. Operating cash flow was negative $10,431,000 and free cash flow was negative $20,394,000 for the quarter.

Read the original on SEC.gov

From revenue to operating profit

Where each $100 of revenue went in this report.

Of every $100 of revenue Cost of sales $79 Operating expenses $11 Left as operating profit $10

Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.

Where revenue came from

The business segments reported by the company.

Home closings revenue 94.5% Financial services revenue 3.6% Land closings revenue 1.0% Amenity and other revenue 0.9%

Shares of the segments disclosed in this filing, largest first.

Reported figures

Earnings per share
$1.01

What stood out

  • Revenue still large but down year-over-year

    Total revenue was $1,387,092,000 for Q1 2026 (Three Months Ended March 31, 2026), down from $1,896,019,000 in Q1 2025 (Three Months Ended March 31, 2025).

  • Solid gross margin dollars but margin compression

    Gross margin was $290,638,000 (20.96% of revenue) in Q1 2026 versus $463,274,000 (24.44%) in Q1 2025, indicating a ~3.48 percentage point decline in gross margin.

  • Strong home closings revenue component

    Home closings revenue remained the dominant component at $1,311,421,000 in Q1 2026, supporting the bulk of total revenue.

  • Balance sheet: inventory and land deposits increased

    Total real estate inventory increased to $6,238,563,000 as of March 31, 2026 from $6,140,663,000 as of December 31, 2025, and land deposits rose to $388,277,000 from $360,690,000.

What to watch

  • Large year-over-year profit decline

    Diluted EPS fell to $1.01 in Q1 2026 from $2.07 in Q1 2025 (Three Months Ended March 31, 2026 and 2025), a decline of about $1.06 per diluted share.

  • Operating margin compression

    Operating income implied at $138,914,000 (calculated as gross margin less sales and G&A and unconsolidated losses) for Q1 2026 implies an operating margin of ~10.01%, down from the ~15.0% level reported in the prior-year quarter.

  • Negative operating and free cash flow this quarter

    Net cash used in operating activities was $10,431,000 for Q1 2026 and purchases of property and equipment were $9,963,000, implying free cash flow of negative $20,394,000 for the quarter.

  • Cash balance declined materially

    Cash, cash equivalents and restricted cash declined to $653,433,000 at March 31, 2026 from $851,231,000 at December 31, 2025, a decrease of $197,798,000.

  • Inventory impairment and incentives pressure

    The Company recorded inventory impairment charges of $8,182,000 in Q1 2026 (three months ended March 31, 2026), reflecting price reductions and incentives in certain communities.

  • Rising exposure from land banking

    Aggregate exposure to loss under land banking arrangements increased to $245.5 million as of March 31, 2026 from $211.7 million as of December 31, 2025.

Management's outlook

No quantitative forward-looking revenue or EPS guidance is provided in the Form 10-Q. MD&A discloses discrete items (e.g., inventory impairments, land banking exposure) but does not give numeric full-year guidance; formal outlook appears deferred to earnings release/call.

This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.