Lennar posts weak quarterly profit as homebuying demand dips

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December 16, 2025 5:31 PM EST

Workers construct a single family home at a Lennar housing development in San Diego, California, U.S., March 11, 2025. REUTERS/Mike Blake

Dec 16 (Reuters) - U.S. homebuilder ⁠Lennar missed ⁠Wall ‍Street's estimates for fourth-quarter profit on Tuesday, as affordability pressures continued to weigh on homebuying demand, sending the ‍company's shares down more than 4% in after-hours trading.

Co-CEO ​Stuart Miller said that while interest rates edged lower during the reported quarter, ​the housing market remained under pressure as affordability constraints persisted and consumer confidence stayed weak.

"Despite the added pressure of a six-week government shutdown, we continued ​to build and sell homes, adapting as needed to changing market conditions," he said.

The Miami, Florida-based company reported a ​fourth-quarter profit of $1.93 per share, below analysts' estimates of $2.22 per share, according to data complied ‌by LSEG.

Higher interest rates have strained affordability and weighed on U.S. homebuilders' earnings in recent quarters, further ​compounded by renewed cost uncertainty tied ⁠to tariffs on lumber and other key building materials.

"While affordability and consumer confidence have remained challenging as ‌interest rates moderated, we have focused on adapting to a new normal as the market finds its footing," Miller said.

Lennar said it expects ‌first-quarter 2026 deliveries of 17,000 to 18,000 homes and home sales gross margin ‌of 15% to 16%. In the quarter ended November 30, the company reported a 17% home sales gross margin.

It expects to deliver a total ‍of 85,000 homes in 2026.

Lennar continues to see margin compression as it leans on sales sweeteners - such ⁠as mortgage-rate buydowns - and contends with cost adjustments in a softening demand environment.

The second-largest U.S. homebuilder by sales reported quarterly revenue of $9.37 billion, above analysts' average estimate of $9.02 billion.

(Reporting by Abhinav Parmar in Bengaluru; Editing by Shailesh Kuber)


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