BEAZER HOMES USA INC (BZH)

CIK: 0000915840. SIC: 1531 Operative Builders. Latest 10-K as of: 2025-11-13.

SIC breadcrumb: Construction > Building Construction General Contractors And Operative Builders > SIC 1531 Operative Builders

SEC company page: https://www.sec.gov/edgar/browse/?CIK=915840. Latest filing source: 0000915840-25-000075.

Selected Fundamentals

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2025-11-13. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000915840.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Free cash flow = operating cash flow - capital expenditures. Missing metrics are omitted rather than fabricated.

Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-04-30. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000915840.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

Quarterly Charts

Macro Cross-References

• CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
• UNRATE - Unemployment Rate
• FEDFUNDS - Federal Funds Effective Rate
• CES0500000003 - Average Hourly Earnings of All Employees, Total Private
• DFEDTARU - Federal Funds Target Range - Upper Limit
• DFEDTARL - Federal Funds Target Range - Lower Limit
• DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
• DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
• DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
• DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
• T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
• CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
• CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
• CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
• CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
• PCEPI - Personal Consumption Expenditures: Chain-type Price Index
• PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
• PPIACO - Producer Price Index by Commodity: All Commodities
• T10YIE - 10-Year Breakeven Inflation Rate
• U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
• PAYEMS - All Employees, Total Nonfarm
• CIVPART - Labor Force Participation Rate
• EMRATIO - Employment-Population Ratio
• UNEMPLOY - Unemployed
• CE16OV - Employment Level
• ICSA - Initial Claims
• JTSJOL - Job Openings: Total Nonfarm
• JTSQUR - Quits: Total Nonfarm
• GDPC1 - Real Gross Domestic Product
• A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
• INDPRO - Industrial Production: Total Index
• TCU - Capacity Utilization: Total Index
• HOUST - New Privately-Owned Housing Units Started: Total Units
• PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
• RSAFS - Advance Retail Sales: Retail Trade
• PCE - Personal Consumption Expenditures
• DSPIC96 - Real Disposable Personal Income
• PSAVERT - Personal Saving Rate
• M2SL - M2
• BOPGSTB - U.S. International Trade in Goods and Services: Balance
• MSPUS - Median Sales Price of Houses Sold for the United States
• HSN1F - New One Family Houses Sold: United States
• RHORUSQ156N - Homeownership Rate in the United States
• TTLCONS - Total Construction Spending: Total Construction in the United States
• RRVRUSQ156N - Rental Vacancy Rate in the United States
• TOTALSL - Total Consumer Credit Owned and Securitized
• REVOLSL - Revolving Consumer Credit Owned and Securitized
• DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
• GDP - Gross Domestic Product
• GPDI - Gross Private Domestic Investment
• GCE - Government Consumption Expenditures and Gross Investment
• PCEC - Personal Consumption Expenditures
• NETEXP - Net Exports of Goods and Services
• GFDEBTN - Federal Debt: Total Public Debt
• GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
• FYFSD - Federal Surplus or Deficit
• FGRECPT - Federal Government Current Receipts
• FGEXPND - Federal Government: Current Expenditures
• MANEMP - All Employees, Manufacturing
• USCONS - All Employees, Construction
• USTRADE - All Employees, Retail Trade
• USFIRE - All Employees, Financial Activities
• USGOVT - All Employees, Government
• AWHAETP - Average Weekly Hours of All Employees, Total Private
• DGORDER - Manufacturers' New Orders: Durable Goods
• NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
• BUSINV - Total Business Inventories
• EXPGS - Exports of Goods and Services
• IMPGS - Imports of Goods and Services
• IR - Import Price Index (End Use): All Commodities
• PPIFIS - Producer Price Index by Commodity: Final Demand

Latest quarter (10-Q)

Latest 10-Q source: 0000915840-26-000041.

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Published MD&A gate trimmed front/tail over-capture. Confidence: high. Filing date: 2026-04-30. Report date: 2026-03-31.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Executive Overview and Outlook

Market Conditions and Strategy

During the second quarter of fiscal 2026, sales paces reflected positive early momentum before plateauing in March with the disruption from geopolitical events. The military conflict in the Middle East heightened existing economic uncertainty and contributed to a rapid increase in mortgage rates, sharply higher energy prices, and other adverse macroeconomic pressures. Despite these uncertainties, the Company continued to execute on several margin-enhancing cost and mix initiatives that are expected to be realized over the remainder of fiscal 2026.

In response to the persistent affordability concerns and overall economic uncertainty, we have maintained a disciplined approach to operations and capital allocation. We continue to focus on our differentiated product strategy, increasing margins, selling non-strategic assets, and improving the efficiency of our land spend to support community count growth and facilitate share repurchases. Further, we are utilizing capital-efficient option agreements, when possible, to finance land spending, while keeping a prudent balance between optioned lots and on-balance sheet inventory.

With our common stock trading below book value, we accelerated our share buyback in the second quarter and repurchased 1.2 million shares of our common stock, approximately 4.0% of our outstanding shares at the end of our fiscal first quarter, for an aggregate $30.0 million. This brings our year-to-date share repurchases to $45.1 million, equating to approximately 6.3% of our outstanding shares at fiscal year end 2025. We expect to continue buyback activity in the coming quarters, using a portion of land sale proceeds to fund the repurchases.

We believe the Company is uniquely positioned to address affordability concerns of today’s buyers and deliver a superior product and buying experience. Our differentiated strategy focuses on:

•Advanced Home Performance, which provides energy savings and lower utility bills, cleaner air, and a quieter and more durable home,

•Curated Choices, which include competitive mortgage pricing to drive customer savings, and a range of floorplan and style options,

•Elevated Experiences, highlighting our easy shopping process and trusted homebuyer support teams to drive high customer satisfaction, and

•Community Impact, featuring the Beazer Charity Foundation and our commitment to make a positive impact in the communities where we build.

Together, these lower the total ongoing costs of homeownership and deliver meaningful financial and lifestyle benefits that make buying a Beazer home more attainable and rewarding.

We continue to work towards our Multi-Year Goals, which include reaching more than 200 active communities by the end of fiscal 2027, reducing our net debt to net capitalization ratio to the low-30% range by the end of fiscal 2027, and achieving a double-digit compound annual growth rate in book value per share from the end of fiscal 2024 through fiscal 2027. We are confident in our differentiated product strategy, the value of our assets, and our ability to generate improving returns for our shareholders.

Overview of Results for Our Fiscal Second Quarter

The following is a summary of our performance against certain key operating and financial metrics during the quarter ended March 31, 2026 and a comparison to the quarter ended March 31, 2025:

•During the quarter ended March 31, 2026, our average active community count of 167 was up 2.9% from 163 in the prior year quarter. We ended the quarter with 169 active communities, up 4.3% from 162 a year ago, as we continue to make strides towards reaching 200 active communities by the end of fiscal 2027.

•During the quarter ended March 31, 2026, orders per community per month were 2.1 compared to 2.3 in the prior year quarter, and our net new orders were 1,048, down 4.6% from 1,098 in the prior year quarter. The decrease in sales pace compared to the prior year reflected weaker consumer sentiment driven by affordability challenges and uncertainties in the macroeconomic environment. We continue to adjust prices, features and incentives to align with the current competitive market conditions.

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Table of Contents

•As of March 31, 2026, our land position included 24,824 controlled lots, down 12.3% from 28,290 as of March 31, 2025. We invested $187.0 million in land acquisition and land development during the quarter ended March 31, 2026, down from $197.0 million during the quarter ended March 31, 2025. We continued to manage our land spend and lot position to improve our capital efficiency and support future community count growth. As part of these efforts, we have realigned the portfolio, divested non-strategic assets, and improved the efficiency of our land spend by using lot option agreements. As of March 31, 2026, we had 14,145 lots, or 59.9% of our total active lots, under option agreements as compared to 16,322 lots, or 59.3% of our total active lots, under option agreements as of March 31, 2025.

•Our Average Selling Price (ASP) for homes closed during the quarter ended March 31, 2026 was $525.4 thousand, up 2.0% from $515.3 thousand in the prior year quarter. Our backlog ASP as of March 31, 2026 was $582.1 thousand, up 6.8% from $544.9 thousand in the prior year quarter. The increase in closing and backlog ASP compared to the prior year quarter was primarily due to changes in product and community mix.

•Homebuilding gross margin for the quarter ended March 31, 2026 was 12.0%, down from 15.1% compared to the prior year quarter. Homebuilding gross margin was impacted by inventory impairment and abandonment charges of $1.3 million during the quarter ended March 31, 2026 related to a project in progress community in our Houston market, principally due to a reduction in price driven by the competitive market dynamics. Refer to Note 4 to the condensed consolidated financial statements included in this Form 10-Q for further discussion. Homebuilding gross margin, excluding impairments, abandonments and interest amortization, for the quarter ended March 31, 2026 was 15.6%, down from 18.3% in the prior year quarter. The decrease in homebuilding gross margin compared to the prior year quarter was primarily due to an increase in price concessions and closing cost incentives, and changes in product and community mix.

•SG&A for the quarter ended March 31, 2026 was 15.5% of total revenue, up from 12.0% in the prior year quarter. The increase in SG&A as a percentage of total revenue compared to the prior year quarter was primarily due to lower homebuilding revenue. SG&A expense was $63.6 million for the quarter ended March 31, 2026, down 6.5% compared to the prior year quarter primarily due to lower commissions. We remain focused on prudently managing overhead costs.

Seasonal and Quarterly Variability

Our homebuilding operating cycle historically has reflected escalating new order activity in the second and third fiscal quarters and increased closings in the third and fourth fiscal quarters. However, these seasonal patterns may be impacted by a variety of factors, including periods of market volatility and changes in mortgage interest rates, which may result in increased or decreased new orders and/or revenues and closings that are outside of the normal ranges typically realized on account of seasonality. Accordingly, our financial results for the three and six months ended March 31, 2026 may not be indicative of our full year results.

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RESULTS OF OPERATIONS:

The following table summarizes certain key income statement metrics for the periods presented:

Three Months Ended

Six Months Ended

March 31,

March 31,

$ in thousands

2026

2025

2026

2025

Revenue:

Homebuilding

$

397,748 

$

556,032 

$

757,490 

$

1,016,454 

Land sales and other

12,098 

9,307 

15,847 

17,838 

Total

$

409,846 

$

565,339 

$

773,337 

$

1,034,292 

Gross profit:

Homebuilding

$

47,639 

$

84,132 

$

85,055 

$

154,107 

Land sales and other

1,061 

1,866 

849 

3,969 

Total

$

48,700 

$

85,998 

$

85,904 

$

158,076 

Gross margin:

Homebuilding(a)

12.0 

 %

15.1 

 %

11.2 

 %

15.2 

 %

Land sales and other(b)

8.8 

%

20.0 

%

5.4 

%

22.3 

%

Total

11.9 

%

15.2 

%

11.1 

%

15.3 

%

Commissions

$

13,390 

$

18,783 

$

25,406 

$

34,896 

General and administrative expenses (G&A)

$

50,194 

$

49,199 

$

103,183 

$

98,971 

SG&A (commissions plus G&A) as a percentage of total revenue

15.5 

%

12.0 

%

16.6 

%

12.9 

%

G&A as a percentage of total revenue

12.2 

%

8.7 

%

13.3 

%

9.6 

%

Depreciation and amortization

$

4,084 

$

4,647 

$

8,126 

$

8,702 

Operating (loss) income

$

(18,968)

$

13,369 

$

(50,811)

$

15,507 

Operating (loss) income as a percentage of total revenue

(4.6)

%

2.4 

%

(6.6)

%

1.5 

%

Effective tax rate(c)

95.1 

%

9.8 

%

32.5 

%

8.2 

%

Inventory impairments and abandonments

$

1,295 

$

528 

$

3,665 

$

528 

(a) Excluding impairments, abandonments, and interest amortized to cost of sales, homebuilding gross margin was 15.6% and 18.3% for the three months ended March 31, 2026 and 2025, respectively, and 14.9% and 18.3% for the six months ended March 31, 2026 and 2025, respectively. A litigation-related charge was recognized during the six months ended March 31, 2026, which reduced homebuilding gross margin, excluding impairments, abandonments, and interest, by 0.8%. Please see the "Homebuilding Gross Profit and Gross Margin" section below for a reconciliation of homebuilding gross profit and the related gross margin excluding impairments and abandonments and interest amortized to cost of sales (non-GAAP measures) to homebuilding gross profit and gross margin, the most directly comparable GAAP measure.

(b) Calculated as land sales and other gross profit divided by land sales and other revenue.

(c) Calculated as tax (benefit) expense for the period divided by (loss) income before income taxes. Our income tax (benefit) expense is not always directly correlated to the amount of pre-tax (loss) income for the associated period due to a variety of factors, including, but not limited to, the impact of tax credits and permanent differences. Our tax credits are predominantly due to the energy efficiency of our homes, with credits valued between $2,000 and $5,000 per single family home. On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law. The OBBBA repeals many of the energy efficiency credits enacted under the Inflation Reduction Act, including our ability to claim energy efficient new home tax credits for homes that close after June 30, 2026. For the three and six months ended March 31, 2026, the Company's effective tax rates were also affected by a change in the approach used to calculate the interim income tax provision, reducing comparability with the prior year periods. Refer to Note 10 to the condensed consolidated financial statements included in this Form 10-Q for additional details.

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Table of Contents

Reconciliation of Net (Loss) Income (GAAP) to Adjusted EBITDA (Non-GAAP)

Reconciliation of Net (Loss) Income (GAAP measure) to Adjusted EBITDA (Non-GAAP measure) is provided for each period discussed below. Management believes that Adjusted EBITDA assists investors in understanding and comparing core operating results and underlying business trends by eliminating many of the differences in companies' respective capitalization, tax position, level of impairments, and other non-recurring items. This non-GAAP financial measure may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

The following table reconci

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted from Item 7 to the first post-MD&A boundary after HTML sanitization. Confidence: high. Filing date: 2025-11-13. Report date: 2025-09-30.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations is intended to help the reader understand our Company, business, operations and present business environment and is provided as a supplement to, and should be read together with the sections entitled “Risk Factors,” and the financial statements and the accompanying notes included elsewhere in this Form 10-K.

In addition, the statements in this discussion and analysis regarding industry outlook, our expectations regarding the performance of our business, anticipated financial results, liquidity and the other non-historical statements are forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Forward-Looking Statements” and in “Risk Factors” above. Our actual results may differ materially from those contained in or implied by any forward-looking statements.

Executive Overview and Outlook

Market Conditions

Fiscal 2025 presented a challenging operating environment, driven by persistent affordability concerns, elevated mortgage rates, weak consumer sentiment, and continued uncertainties in the macroeconomic environment. In response, we offered discounts and incentives to stimulate sales and turn inventory. We also maintained a disciplined approach to our operations and capital allocation. This included slowing land spend to match current market conditions, renegotiating more favorable land acquisition terms, and pursuing capital-efficient growth opportunities through expanded usage of lot option agreements. During fiscal 2025, we allocated more capital to share repurchases, as our shares traded at a discount to book value, which we believe represented a compelling investment opportunity. Despite the soft selling environment, we continue to see longer-term housing market conditions as favorable with production shortfalls over the past decade contributing to a fundamental long-term undersupply of housing.

Multi-Year Goals

During fiscal 2025, we made steady progress toward our Multi-Year Goals and remain on track to achieve each of these objectives.

•Growth: reaching more than 200 active communities by the end of fiscal 2027,

•Deleveraging: reducing our net debt to net capitalization ratio to the low 30% range by the end of fiscal 2027, and

•Book value per share: achieving a double-digit compound annual growth rate in book value per share from the end of fiscal 2024 through fiscal 2027.

As of September 30, 2025, our ending active community count was 169, up 4.3% from 162 in the prior year. This marks the third consecutive year of growth in community count as we work towards our goal of reaching more than 200 active communities by the end of fiscal 2027.

Our total debt to total capitalization ratio and net debt to net capitalization ratio were 45.2% and 39.5%, respectively, as of September 30, 2025, down 20 basis points and 50 basis points, respectively, compared to the prior year, despite the difficult environment. This reduction reflects our capital allocation and strategic asset alignment decisions to moderate land spend and increase land sales. With a strong balance sheet and ample liquidity, we believe we are well-equipped to navigate the evolving market dynamics and reduce our net debt to net capitalization ratio to the low 30% range by the end of fiscal 2027.

Our book value per share as of September 30, 2025 was $42.57, up from $40.05 in the prior year, an increase of 6.3%. This growth reflects our continued profitability and active share repurchase program, which has contributed meaningfully to long-term value creation. During fiscal 2025, we repurchased 1.5 million shares of our common stock, approximately 5% of our outstanding shares, for $33.1 million at an average price per share of $22.20.

As we look to fiscal 2026, we continue to advance towards the achievement of our Multi-Year Goals, while maintaining a strong liquidity position. We are accelerating our brand-building and marketing efforts to communicate our differentiated value proposition and drive customer engagement. A key component of this proposition is the energy efficiency of our homes, which enables homeowners to generate meaningful utility savings and reduce their total cost of ownership. We believe these operational and strategic initiatives will enhance our differentiated market position and support significant value creation for our stockholders.

25

Overview of Results for Our Fiscal 2025

The following is a summary of our performance against certain key operating and financial metrics during fiscal 2025, as compared to fiscal 2024.

•During the fiscal year ended September 30, 2025, our average active community count of 164 was up 14.2% from 144 in the prior year. As of September 30, 2025, our ending active community count was 169, up 4.3% from 162 in the prior year. We invested $684.0 million in land acquisition and land development during the year ended September 30, 2025, down 11.9% compared to $776.5 million in land spend during the year ended September 30, 2024. In response to the evolving market conditions, we reallocated a portion of our land investment toward reaching our Multi-Year Goals of deleveraging and growing book value per share. This shift underscores our confidence in our strong land position and the visibility we have into our community count growth.

•As of September 30, 2025, our land position included 25,660 controlled lots, down 10.1% from 28,538 as of September 30, 2024. We remain focused on the expanded usage of lot option agreements, which allow us to position for future growth while providing the flexibility to respond to market conditions. As of September 30, 2025, we had 15,373 lots, or 62.1% of our total active lots, under option agreements as compared to 16,125 lots, or 57.8% of our total active lots, under option agreements as of September 30, 2024.

•During the fiscal year ended September 30, 2025, orders per community per month were 2.0 compared to 2.4 in the prior year, and our net new orders were 3,890, down 7.8% from 4,221 in the prior year. The decrease in sales pace compared to the prior year reflected weaker consumer sentiment driven by affordability challenges and uncertainties in the macroeconomic environment. We continue to adjust prices, features and incentives to align with the current competitive market conditions.

•Homebuilding gross margin for the fiscal year ended September 30, 2025 was 14.3%, down from 18.0% in the prior year. Homebuilding gross margin was impacted by inventory impairment and abandonment charges of $10.2 million during the year ended September 30, 2025, of which $8.6 million related to impairments recorded for two projects in progress communities, one located in our Phoenix market and the other in our Orlando market, principally due to a reduction in price driven by the competitive and market dynamics. The remaining $1.6 million represents abandonment charges related to land acquisition deals we terminated during the year. Refer to Note 4 of the notes to the consolidated financial statements included in this Form 10-K for further discussion. Homebuilding gross margin, excluding impairments, abandonments and interest amortization, for the fiscal year ended September 30, 2025 was 18.0%, down from 21.1% in the prior year. The year-over-year decrease in homebuilding gross margin for the fiscal year ended September 30, 2025 was primarily driven by an increase in price concessions and incentives, such as mortgage rate buydowns, an increased share of spec home closings which generally have lower margins than "to be built" homes, and changes in product and community mix.

•SG&A for the fiscal year ended September 30, 2025 was 11.9% of total revenue compared with 11.4% a year earlier. SG&A expense was $281.7 million for the fiscal year ended September 30, 2025, up 5.8% compared to prior year primarily due to higher sales and marketing costs and other G&A expenses to support community count growth, partially offset by lower commissions.

26

Seasonal and Quarterly Variability: Our homebuilding operating cycle historically has reflected escalating new order activity in the second and third fiscal quarters and increased closings in the third and fourth fiscal quarters. However, these seasonal patterns may be impacted by a variety of factors, including periods of market volatility and changes in mortgage interest rates, which may result in increased or decreased new orders and/or revenues and closings that are outside of the normal ranges typically realized on account of seasonality.

The following tables present new order and closings data for the periods presented:

New Orders (Net of Cancellations)

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

Total

2025

932 

1,098 

861 

999 

3,890 

2024

823 

1,299 

1,070 

1,029 

4,221 

2023

482 

1,181 

1,200 

1,003 

3,866 

Closings

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

Total

2025

907 

1,079 

1,035 

1,406 

4,427 

2024

743 

1,044 

1,167 

1,496 

4,450 

2023

833 

1,063 

1,117 

1,233 

4,246 

27

RESULTS OF CONTINUING OPERATIONS

The following table summarizes certain key income statement metrics for the periods presented:

Fiscal Year Ended September 30,

$ in thousands

2025

2024

2023

Revenue:

Homebuilding

$

2,302,630 

$

2,292,984 

$

2,198,400 

Land sales and other

68,925 

37,213 

8,385 

Total

$

2,371,555 

$

2,330,197 

$

2,206,785 

Gross profit:

Homebuilding

$

329,376 

$

413,611 

$

438,120 

Land sales and other

8,138 

10,683 

4,575 

Total

$

337,514 

$

424,294 

$

442,695 

Gross margin:

Homebuilding(a)

14.3 

%

18.0 

%

19.9 

%

Land sales and other(b)

11.8 

%

28.7 

%

54.6 

%

Total

14.2 

%

18.2 

%

20.1 

%

Commissions

$

76,911 

$

80,056 

$

73,450 

General and administrative expenses (G&A)

$

204,830 

$

186,345 

$

179,794 

SG&A (commissions plus G&A) as a percentage of total revenue

11.9 

%

11.4 

%

11.5 

%

G&A as a percentage of total revenue

8.6 

%

8.0 

%

8.1 

%

Depreciation and amortization

$

19,168 

$

14,867 

$

12,198 

Operating income

$

36,605 

$

143,026 

$

177,253 

Operating income as a percentage of total revenue

1.5 

%

6.1 

%

8.0 

%

Effective tax rate(c)

(11.6)

%

11.9 

%

13.1 

%

Inventory impairments and abandonments

$

12,959 

$

1,996 

$

641 

Loss on extinguishment of debt, net

$

— 

$

(437)

$

(546)

(a) Excluding impairments, abandonments, and interest amortized to cost of sales, homebuilding gross margin was 18.0%, 21.1% and 23.1% for the fiscal years ended September 30, 2025, 2024 and 2023, respectively. Please see the "Homebuilding Gross Profit and Gross Margin" section below for a reconciliation of homebuilding gross profit and the related gross margin excluding impairments and abandonments and interest amortized to cost of sales (non-GAAP measures) to homebuilding gross profit and gross margin, the most directly comparable GAAP measure.

(b) Calculated as land sales and other gross profit divided by land sales and other revenue.

(c) Calculated as tax (benefit) expense for the period divided by income from continuing operations before income taxes. Our income tax (benefit) expense is not always directly correlated to the amount of pre-tax income for the associated period due to a variety of factors, including, but not limited to, the impact of tax credits and permanent differences. Our tax credits are predominantly due to the energy efficiency of our homes, with credits valued between $2,000 and $5,000 per single family home. On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law. The OBBBA repeals many of the energy-efficiency credits enacted under the Inflation Reduction Act, including our ability to claim energy efficient new home tax credits for homes that close after June 30, 2026. While this change does not impact our fiscal 2025 effective rate and deferred tax balances, we are evaluating the full impact of the OBBBA on our future tax provision and financial results.

28

Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)

Reconciliation of Net Income (GAAP measure) to Adjusted EBITDA (Non-GAAP measure) is provided for each period discussed below. Management believes that Adjusted EBITDA assists investors in understanding and comparing core operating results and underlying business trends by eliminating many of the differences in companies' respective capitalization, tax position, level of impairments, and other non-recurring items. This non-GAAP financial measure may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

The following table reconciles our net income (GAAP) to Adjusted EBITDA (non-GAAP) for the periods presented:

Fiscal Year Ended September 30,

in thousands

2025

2024

2023

2022

2021

Net income (GAAP)

$

45,588 

$

140,175 

$

158,611 

$

220,704 

$

122,021 

(Benefit) expense from income taxes

(4,738)

18,910 

23,936 

53,267 

21,501 

Interest amortized to home construction and land sales expenses and capitalized interest impaired

78,866 

68,233 

68,489 

72,058 

87,290 

Interest expense not qualified for capitalization

— 

— 

— 

— 

2,781 

EBIT (Non-GAAP)

119,716 

227,318 

251,036 

346,029 

233,593 

Depreciation and amortization

19,168 

14,867 

12,198 

13,360 

13,976 

EBITDA (Non-GAAP)

138,884 

242,185 

263,234 

359,389 

247,569 

Stock-based compensation expense

7,338 

7,391 

7,275 

8,478 

12,167 

Loss (gain) on extinguishment of debt

— 

437 

546 

(309)

2,025 

Inventory impairments and abandonments(a)

11,497 

1,996 

641 

2,524 

853 

Gain on sale of investment(b)

— 

(8,591)

— 

— 

— 

Litigation settlement in discontinued operations

— 

— 

— 

— 

120 

Restructuring and severance expenses

— 

— 

335 

— 

(10)

Adjusted EBITDA (Non-GAAP)

$

157,719 

$

243,418 

$

272,031 

$

370,082 

$

262,724 

(a) In periods during which we impaired certain of our inventory assets, capitalized interest that is impaired is included in the line above titled "Interest amortized to home construction and land sales expenses and capitalized interest impaired."

(b) We previously held a minority interest in a technology company specializing in digital marketing for new home communities, which was sold during the quarter ended March 31, 2024. In exchange for the previously held investment, we received cash in escrow along with a minority partnership interest in the acquiring company, which was recorded within other assets in our consolidated balance sheets. The resulting gain of $8.6 million from this transaction was recognized in other income, net on our consolidated statement of operations. The Company believes excluding this one-time gain from Adjusted EBITDA provides a better reflection of the Company's performance as this item is not representative of our core operations.

29

Reconciliation of Total Debt to Total Capitalization Ratio (GAAP) to Net Debt to Net Capitalization Ratio (Non-GAAP)

Reconciliation of total debt to total capitalization ratio (GAAP measure) to net debt to net capitalization ratio (non-GAAP measure) is provided for each period below. Management believes that net debt to net capitalization ratio is useful in understanding the leverage employed in our operations and as an indicator of our ability to obtain financing. This non-GAAP financial measure may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

Fiscal Year Ended September 30,

in thousands

2025

2024

Total debt (GAAP)

$

1,029,114 

$

1,025,349 

Stockholders' equity (GAAP)

1,248,906 

1,232,111 

Total capitalization (GAAP)

$

2,278,020 

$

2,257,460 

Total debt to total capitalization ratio (GAAP)

45.2 

%

45.4 

%

Total debt (GAAP)

$

1,029,114 

$

1,025,349 

Less: cash and cash equivalents (GAAP)

214,705 

203,907 

Net debt (Non-GAAP)

814,409 

821,442 

Stockholders' equity (GAAP)

1,248,906 

1,232,111 

Net capitalization (Non-GAAP)

$

2,063,315 

$

2,053,553 

Net debt to net capitalization ratio (Non-GAAP)

39.5 

%

40.0 

%

30

Homebuilding Operations Data

The following table summarizes net new orders and cancellation rates by reportable segment for the periods presented:

New Orders, net

Cancellation Rates

2025

2024

2023

25 v 24

24 v 23

2025

2024

2023

West

2,365 

2,753 

2,244 

(14.1)

%

22.7 

%

19.3 

%

17.3 

%

22.2 

%

East

935 

912 

859 

2.5 

%

6.2 

%

15.7 

%

19.5 

%

18.8 

%

Southeast

590 

556 

763 

6.1 

%

(27.1)

%

14.1 

%

16.8 

%

15.9 

%

Total

3,890 

4,221 

3,866 

(7.8)

%

9.2 

%

17.7 

%

17.7 

%

20.3 

%

Net new orders for the year ended September 30, 2025 decreased to 3,890, down 7.8% from the year ended September 30, 2024. The decrease in net new orders was driven primarily by a decrease in sales pace from 2.4 orders per community per month in the prior year to 2.0, partially offset by an increase in average active community count from 144 in the prior year to 164.

West Segment: Net new orders for the year ended September 30, 2025 was 2,365, down 14.1% from the year ended September 30, 2024. The decrease in net new orders compared to the prior year was driven by a 22.4% decrease in sales pace from 2.5 orders per community per month in the prior year to 1.9, partially offset by a 10.7% increase in average active community count from 93 in the prior year to 103.

East Segment: Net new orders for the year ended September 30, 2025 was 935, up 2.5% from the year ended September 30, 2024. The increase in net new orders compared to the prior year was driven by a 20.6% increase in average active community count from 30 in the prior year to 36, partially offset by a 15.0% decrease in sales pace from 2.5 orders per community per month in the prior year to 2.2.

Southeast Segment: Net new orders for the year ended September 30, 2025 was 590, up 6.1% from the year ended September 30, 2024. The increase in net new orders compared to the prior year was driven by a 20.2% increase in average active community count from 21 in the prior year to 25, partially offset by an 11.7% decrease in sales pace from 2.2 orders per community per month in the prior year to 1.9.

The table below summarizes backlog units by reportable segment as well as the aggregate dollar value and ASP of homes in backlog as of September 30, 2025, 2024 and 2023:

As of September 30,

2025

2024

2023

25 v 24

24 v 23

Backlog Units:

West

525 

965 

1,033 

(45.6)

%

(6.6)

%

East

228 

315 

323 

(27.6)

%

(2.5)

%

Southeast

192 

202 

355 

(5.0)

%

(43.1)

%

Total

945 

1,482 

1,711 

(36.2)

%

(13.4)

%

Aggregate dollar value of homes in backlog (in millions)

$

516.5 

$

797.2 

$

886.4 

(35.2)

%

(10.1)

%

ASP in backlog (in thousands)

$

546.5 

$

537.9 

$

518.0 

1.6 

%

3.8 

%

Backlog reflects the number of homes for which the Company has entered into a sales contract with a customer but has not yet delivered the home. The decrease in backlog units was primarily due to closings exceeding net new orders for the year ended September 30, 2025. The aggregate dollar value of homes in backlog as of September 30, 2025 decreased 35.2% compared to the prior year due to a 36.2% decrease in backlog units, partially offset by a 1.6% increase in the ASP of homes in backlog. The increase in backlog ASP was primarily due to changes in product and community mix.

31

Homebuilding Revenue, Average Selling Price, and Closings

The table below summarizes homebuilding revenue, ASP of our homes closed, and closings by reportable segment for the periods presented:

Homebuilding Revenue

Average Selling Price

$ in thousands

2025

2024

2023

25 v 24

24 v 23

2025

2024

2023

25 v 24

24 v 23

West

$

1,422,260 

$

1,448,607 

$

1,292,060 

(1.8)

%

12.1 

%

$

507.0 

$

513.5 

$

523.5 

(1.3)

%

(1.9)

%

East

575,533 

483,611 

503,479 

19.0 

%

(3.9)

%

563.1 

525.7 

532.2 

7.1 

%

(1.2)

%

Southeast

304,837 

360,766 

402,861 

(15.5)

%

(10.4)

%

508.1 

508.8 

484.2 

(0.1)

%

5.1 

%

Total

$

2,302,630 

$

2,292,984 

$

2,198,400 

0.4 

%

4.3 

%

$

520.1 

$

515.3 

$

517.8 

0.9 

%

(0.5)

%

Closings

2025

2024

2023

25 v 24

24 v 23

West

2,805 

2,821 

2,468 

(0.6)

%

14.3 

%

East

1,022 

920 

946 

11.1 

%

(2.7)

%

Southeast

600 

709 

832 

(15.4)

%

(14.8)

%

Total

4,427 

4,450 

4,246 

(0.5)

%

4.8 

%

West Segment: Homebuilding revenue decreased by 1.8% for the fiscal year ended September 30, 2025 compared to the prior fiscal year due to a 1.3% decrease in ASP and a 0.6% decrease in closings. The year-over-year slight decrease in closings in the West segment was primarily due to lower beginning backlog, partially offset by higher volume of spec homes that sold and closed within the current year period and improved construction cycle times for fiscal 2025 compared to fiscal 2024.

East Segment: Homebuilding revenue increased by 19.0% for the fiscal year ended September 30, 2025 compared to the prior fiscal year due to an 11.1% increase in closings as well as a 7.1% increase in ASP. The year-over-year increase in closings in the East segment was primarily due to higher volume of spec homes that sold and closed within the current year period and improved construction cycle times, partially offset by lower beginning backlog, for fiscal 2025 compared to fiscal 2024.

Southeast Segment: Homebuilding revenue decreased by 15.5% for the fiscal year ended September 30, 2025 compared to the prior fiscal year due to a 15.4% decrease in closings, and a 0.1% decrease in ASP. The year-over-year decrease in closings in the Southeast segment is primarily due to lower beginning backlog, partially offset by higher volume of spec homes that sold and closed within the current year period for fiscal 2025 compared to fiscal 2024.

32

Homebuilding Gross Profit and Gross Margin

The following tables present our homebuilding (HB) gross profit and gross margin by reportable segment and Corporate and unallocated. In addition, such amounts are presented excluding inventory impairments and abandonments and interest amortized to cost of sales (COS). Homebuilding gross profit is defined as homebuilding revenue less home cost of sales (which includes land and land development costs, home construction costs, capitalized interest, indirect costs of construction, estimated warranty costs, closing costs, and inventory impairment and abandonment charges).

Reconciliation of homebuilding gross profit and homebuilding gross margin (GAAP measures) to homebuilding gross profit and the related gross margin excluding impairments and abandonments and interest amortized to cost of sales (non-GAAP measures) is provided for each period discussed below. Management believes that this information assists investors in comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies' respective level of impairments and level of debt. These non-GAAP financial measures may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

$ in thousands

Fiscal Year Ended September 30, 2025

HB Gross

Profit (GAAP)

HB Gross

Margin (GAAP)

Impairments &

Abandonments

(I&A)

HB Gross

Profit excluding

I&A (Non-GAAP)

HB Gross

Margin 

excluding

I&A (Non-GAAP)

Interest

Amortized to COS (Interest)

HB Gross Profit excluding I&A and

Interest (Non-GAAP)

HB Gross Margin excluding I&A and Interest (Non-GAAP)

West

$

255,332 

18.0 

%

$

3,157 

$

258,489 

18.2 

%

$

— 

$

258,489 

18.2 

%

East

98,132 

17.1 

%

215 

98,347 

17.1 

%

— 

98,347 

17.1 

%

Southeast

46,790 

15.3 

%

5,852 

52,642 

17.3 

%

— 

52,642 

17.3 

%

Corporate & unallocated(a)

(70,878)

1,002 

(69,876)

73,743 

3,867 

Total homebuilding

$

329,376 

14.3 

%

$

10,226 

$

339,602 

14.7 

%

$

73,743 

$

413,345 

18.0 

%

$ in thousands

Fiscal Year Ended September 30, 2024

HB Gross

Profit (GAAP)

HB Gross

Margin (GAAP)

Impairments &

Abandonments

(I&A)

HB Gross

Profit excluding

I&A (Non-GAAP)

HB Gross

Margin 

excluding

I&A (Non-GAAP)

Interest

Amortized to COS (Interest)

HB Gross Profit excluding I&A and

Interest (Non-GAAP)

HB Gross Margin excluding I&A and Interest (Non-GAAP)

West

$

306,366 

21.1 

%

$

1,805 

$

308,171 

21.3 

%

$

— 

$

308,171 

21.3 

%

East

87,481 

18.1 

%

91 

87,572 

18.1 

%

— 

87,572 

18.1 

%

Southeast

79,174 

21.9 

%

100 

79,274 

22.0 

%

— 

79,274 

22.0 

%

Corporate & unallocated(a)

(59,410)

— 

(59,410)

67,658 

8,248 

Total homebuilding

$

413,611 

18.0 

%

$

1,996 

$

415,607 

18.1 

%

$

67,658 

$

483,265 

21.1 

%

$ in thousands

Fiscal Year Ended September 30, 2023

HB Gross

Profit (GAAP)

HB Gross

Margin (GAAP)

Impairments &

Abandonments

(I&A)

HB Gross

Profit excluding

I&A (Non-GAAP)

HB Gross

Margin 

excluding

I&A (Non-GAAP)

Interest

Amortized to COS (Interest)

HB Gross Profit excluding I&A and

Interest (Non-GAAP)

HB Gross Margin excluding I&A and Interest (Non-GAAP)

West

$

307,240 

23.8 

%

$

487 

$

307,727 

23.8 

%

$

— 

$

307,727 

23.8 

%

East

103,102 

20.5 

%

154 

103,256 

20.5 

%

— 

103,256 

20.5 

%

Southeast

92,212 

22.9 

%

— 

92,212 

22.9 

%

— 

92,212 

22.9 

%

Corporate & unallocated(a)

(64,434)

— 

(64,434)

68,489 

4,055 

Total homebuilding

$

438,120 

19.9 

%

$

641 

$

438,761 

20.0 

%

$

68,489 

$

507,250 

23.1 

%

(a) Corporate and unallocated includes amortization of capitalized interest, capitalization and amortization of indirect costs related to homebuilding activities, as well as capitalized interest and capitalized indirect costs impaired in order to reflect projects in progress assets at fair value, when applicable.

33

Our homebuilding gross profit decreased by $84.2 million to $329.4 million for the fiscal year ended September 30, 2025, compared to $413.6 million in the prior year. The decrease in homebuilding gross profit was primarily driven by a decrease in gross margin of 370 basis points to 14.3%, partially offset by an increase in homebuilding revenue of $9.6 million. However, as shown in the tables above, the comparability of our gross profit and gross margin was impacted by impairments and abandonment charges which increased by $8.2 million and interest amortized to homebuilding cost of sales which increased by $6.1 million year-over-year (refer to Note 4 and Note 5 of the notes to the consolidated financial statements in this Form 10-K for additional details). When excluding the impact of impairments and abandonment charges and interest amortized to homebuilding cost of sales, homebuilding gross profit decreased by $69.9 million compared to the prior year while homebuilding gross margin decreased by 310 basis points to 18.0%. The year-over-year decrease in gross margin for the fiscal year ended September 30, 2025 was primarily driven by an increase in price concessions and incentives, such as mortgage rate buydowns, an increased share of spec home closings which generally have lower margins than "to be built" homes, and changes in product and community mix.

West Segment: Compared to the prior fiscal year, homebuilding gross profit decreased by $51.0 million due to lower gross margin and a decrease in homebuilding revenue. Homebuilding gross margin, excluding impairments and abandonments, decreased to 18.2%, down from 21.3% in the prior year. The decrease in gross margin was primarily driven by an increase in price concessions and incentives, an increased share of spec home closings which generally have lower margins than "to be built" homes, and changes in product and community mix.

East Segment: Compared to the prior fiscal year, homebuilding gross profit increased by $10.7 million due to an increase in homebuilding revenue, partially offset by lower gross margin. Homebuilding gross margin, excluding impairments and abandonments, decreased to 17.1%, down from 18.1% in the prior year. The decrease in gross margin was primarily driven by an increase in price concessions and incentives, an increased share of spec home closings which generally have lower margins than "to be built" homes, and changes in product and community mix.

Southeast Segment: Compared to the prior fiscal year, homebuilding gross profit decreased by $32.4 million due to a decrease in homebuilding revenue and lower gross margin. Homebuilding gross margin, excluding impairments and abandonments, decreased to 17.3%, down from 22.0% in the prior year. The decrease in gross margin was primarily driven by an increase in price concessions and incentives, an increased share of spec home closings which generally have lower margins than "to be built" homes, and changes in product and community mix.

Measures of homebuilding gross profit and gross margin after excluding inventory impairments and abandonments, interest amortized to cost of sales, and other non-recurring items are non-GAAP financial measures. These measures should not be considered alternatives to homebuilding gross profit and gross margin determined in accordance with GAAP as an indicator of operating performance.

34

Land Sales and Other Revenue and Gross Profit

Land sales relate to land and lots sold that do not fit within our homebuilding programs or strategic plans. We also have other revenue related to title examinations provided for our homebuyers in certain markets. The following tables summarize our land sales and other revenue and related gross profit by reportable segment and Corporate and unallocated for the periods presented:

$ in thousands

Land Sales and Other Revenue

2025

2024

2023

25 v 24

24 v 23

West

$

54,051 

$

18,680 

$

4,945 

189.4 

%

277.8 

%

East

9,804 

17,595 

2,365 

(44.3)

%

644.0 

%

Southeast

5,070 

938 

1,075 

440.5 

%

(12.7)

%

Total

$

68,925 

$

37,213 

$

8,385 

85.2 

%

343.8 

%

$ in thousands

Land Sales and Other Gross Profit (Loss)

2025

2024

2023

25 v 24

24 v 23

West

$

9,953 

$

4,438 

$

2,989 

124.3 

%

48.5 

%

East

2,469 

6,391 

736 

(61.4)

%

768.3 

%

Southeast

2,346 

688 

850 

241.0 

%

(19.1)

%

Corporate and unallocated(a)

(6,630)

(834)

— 

(695.0)

%

n/m(b)

Total

$

8,138 

$

10,683 

$

4,575 

(23.8)

%

133.5 

%

(a) Corporate and unallocated includes capitalized interest and capitalized indirect costs expensed to land cost of sales related to land and lots sold, as well as capitalized interest and capitalized indirect costs impaired in order to reflect land held for sale assets at fair value less cost to sell.

(b) n/m - indicates the percentage is "not meaningful."

For the fiscal year ended September 30, 2025, land sales and other revenue increased by 85.2% to $68.9 million, and land sales and other gross profit decreased by 23.8% to $8.1 million compared to the prior year.

During the fiscal year ended September 30, 2025, our reviews of various communities led to a decision to sell certain lots that no longer aligned with our strategic plans. As a result of changes in strategy, we reclassified 131 lots from projects in progress to land held for sale and recognized a land held for sale impairment charge of $2.7 million during the fiscal year ended September 30, 2025 related to communities in our Phoenix, San Antonio, and Houston markets. No land held for sale impairment charges were recognized during the fiscal year ended September 30, 2024. Refer to Note 4 of the notes to the condensed consolidated financial statements included in this Form 10-K for further discussion.

Year-over-year fluctuations in land sales and other revenue are primarily driven by the timing and volume of land and lot sales closings. As we continue to proactively manage our land position and divest land assets that no longer align with our strategic priorities, the dollar value of land sales and other revenue may grow. Land sales and other gross profit are primarily impacted by the profitability of individual land and lot sale transactions as well as the volume of our title examinations operations. Future land and lot sales will depend on a variety of factors, including local market conditions, individual community performance, and changing strategic plans.

35

Operating Income

The table below summarizes operating income by reportable segment and Corporate and unallocated for the periods presented:

Fiscal Year Ended September 30,

in thousands

2025

2024

2023

25 v 24

24 v 23

West

$

142,514 

$

189,739 

$

205,850 

$

(47,225)

$

(16,111)

East

54,655 

52,898 

65,021 

1,757 

(12,123)

Southeast

15,183 

45,666 

57,326 

(30,483)

(11,660)

Corporate and Unallocated(a)

(175,747)

(145,277)

(150,944)

(30,470)

5,667 

Operating income

$

36,605 

$

143,026 

$

177,253 

$

(106,421)

$

(34,227)

(a) Includes amortization of capitalized interest, capitalization and amortization of indirect costs, impairment of capitalized interest and capitalized indirect costs, when applicable, expenses related to numerous shared services functions that benefit all segments but are not allocated to the operating segments reported above, including information technology, treasury, corporate finance, legal, branding and national marketing, and certain other amounts that are not allocated to our operating segments.

Our operating income decreased by $106.4 million to $36.6 million for the year ended September 30, 2025, compared to operating income of $143.0 million for year ended September 30, 2024, primarily driven by the previously discussed decrease in gross profit, including the impact of $13.0 million inventory impairments and abandonments recognized. SG&A as a percentage of total revenue increased by 50 basis points compared to the prior year, from 11.4% to 11.9%, primarily due to higher sales and marketing expenses and other G&A expenses to support community count growth, partially offset by lower commissions.

West Segment: The $47.2 million decrease in operating income compared to the prior year was primarily due to the decrease in gross profit and higher sales and marketing expenses, partially offset by lower commissions on lower homebuilding revenue in the segment.

East Segment: The $1.8 million increase in operating income compared to the prior year was primarily due to the increase in gross profit previously discussed, partially offset by higher commissions expense on higher homebuilding revenue, higher other G&A expenses, and higher sales and marketing expenses in the segment.

Southeast Segment: The $30.5 million decrease in operating income compared to the prior year was primarily due to the decrease in gross profit previously discussed and higher other G&A expenses, partially offset by lower commissions expense on lower homebuilding revenue in the segment.

Corporate and Unallocated: Our corporate and unallocated results include amortization of capitalized interest, capitalization and amortization of indirect costs, impairment of capitalized interest and capitalized indirect costs, expenses for various shared services functions that benefit all segments but are not allocated, including information technology, treasury, corporate finance, legal, branding and national marketing, and certain other amounts that are not allocated to our operating segments. For the fiscal year ended September 30, 2025, corporate and unallocated net expenses increased by $30.5 million from the prior fiscal year, primarily due to higher G&A expenses, higher amortization of capitalized interest and capitalized indirect costs to homebuilding and land sales cost of sales, higher depreciation and amortization expenses, and an impairment of capitalized interest and capitalized indirect costs of $2.2 million recognized during the current year compared to no such charge in the prior year.

Below operating income, we had the following noteworthy year-over-year fluctuations for the fiscal year ended September 30, 2025 compared to the prior year. Specifically, (1) within, other income, net, we recognized a gain on sale of investment of $8.6 million during the year ended September 30, 2024 compared to no such transaction in the current year (See the "Reconciliation of Net Income (GAAP) to Adjusted EBITDA (Non-GAAP)" section above for further discussion on this transaction), (2) within other income, net, we experienced lower interest income year-over-year driven by lower interest rates on lower operating cash balances, and (3) we recorded a loss on extinguishment of debt of $0.4 million during the year ended September 30, 2024 compared to no such loss in the current period. See Note 7 of the notes to our consolidated financial statements in this Form 10-K for a further discussion of debt.

36

Income Taxes

We recognized income tax benefit from continuing operations of $4.7 million for the fiscal year ended September 30, 2025, compared to income tax expense from continuing operations of $18.9 million and $24.0 million for our fiscal years ended September 30, 2024 and 2023, respectively. Income tax benefit in our fiscal 2025 primarily resulted from the generation of additional federal tax credits, partially offset by the tax expense from income generated in the fiscal year and permanent book/tax differences. Income tax expense in our fiscal 2024 and 2023 primarily resulted from income generated in the fiscal year and permanent book/tax differences, partially offset by the generation of additional federal tax credits. Refer to Note 12 of the notes to the consolidated financial statements in this Form 10-K for a further discussion of our income taxes.

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law. The OBBBA repeals many of the energy efficiency credits enacted under the Inflation Reduction Act, including our ability to claim energy efficient new home tax credits for homes that close after June 30, 2026. While this change does not impact our fiscal 2025 effective tax rate and deferred tax balances, we are evaluating the full impact of the OBBBA on our future tax provision and financial results.

Liquidity and Capital Resources

Our sources of liquidity include, but are not limited to, cash from operations, proceeds from Senior Notes, our Senior Unsecured Revolving Credit Facility (the Unsecured Facility), and other bank borrowings, the issuance of equity and equity-linked securities, and other external sources of funds. Our short-term and long-term liquidity depends primarily upon our level of net income, working capital management (cash, accounts receivable, accounts payable and other liabilities), and available credit facilities.

Net changes in cash, cash equivalents, and restricted cash are as follows for the periods presented:

in thousands

2025

2024

2023

Net cash provided by (used in) operating activities

$

31,981 

$

(137,545)

$

178,057 

Net cash used in investing activities

(19,659)

(30,012)

(29,670)

Net cash (used in) provided by financing activities

(36,361)

23,878 

(13,926)

Net (decrease) increase in cash, cash equivalents, and restricted cash

$

(24,039)

$

(143,679)

$

134,461 

Operating Activities

Net cash provided by operating activities was $32.0 million for the fiscal year ended September 30, 2025. The primary drivers of operating cash flows are typically cash earnings and changes in inventory levels, including land acquisition and development spending. Net cash provided by operating activities during the period was primarily driven by income before income taxes of $40.9 million, which included $30.4 million of non-cash charges and a decrease in inventory of $2.8 million, partially offset by a net increase in non-inventory working capital of $42.0 million.

Net cash used in operating activities was $137.5 million for the fiscal year ended September 30, 2024. Net cash used in operating activities during the period was primarily driven by an increase in inventory of $282.1 million resulting from land acquisition, land development, and house construction spending to support continued growth and a net increase in non-inventory working capital of $30.2 million, partially offset by income before income taxes of $159.1 million, which included $15.7 million of non-cash charges.

Investing Activities

Net cash used in investing activities for the fiscal year ended September 30, 2025 was $19.7 million, primarily driven by capital expenditures for model homes and information systems infrastructure and purchase of investment securities, partially offset primarily by proceeds from maturities of investment securities.

Net cash used in investing activities for the fiscal year ended September 30, 2024 was $30.0 million, primarily driven by capital expenditures for model homes and information systems infrastructure and purchases of investment securities.

Financing Activities

Net cash used in financing activities was $36.4 million for the fiscal year ended September 30, 2025, primarily driven by repurchases of common stock and tax payments for stock-based compensation awards vesting.

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Net cash provided by financing activities was $23.9 million for the fiscal year ended September 30, 2024, primarily driven by inflows from the issuance of the 2031 Notes, partially offset by outflows from redemption of our 2025 Notes, debt issuance costs related to the 2031 Notes and extension of the term of our Unsecured Facility (see Note 7), repurchases of common stock, and tax payments for stock-based compensation awards vesting.

Financial Position

As of September 30, 2025, our liquidity position consisted of $214.7 million in cash and cash equivalents and $323.6 million of remaining capacity under the Unsecured Facility, compared to $203.9 million in cash and cash equivalents and $300.0 million of remaining capacity under the Unsecured Facility as of September 30, 2024.

While we believe we possess sufficient liquidity, we are mindful of potential short-term or seasonal requirements for enhanced liquidity that may arise to operate and grow our business. As of the date of this report, we believe we have adequate capital resources and sufficient access to external financing sources to satisfy our current and long-term liquidity needs for funds to conduct our operations and meet other needs in the ordinary course of our business, however, we are continually reviewing our capital resources to determine whether we can meet our short- and long-term goals, and we may require additional capital to do so.

At times, we may also engage in capital markets, bank loans, project debt or other financial transactions, including the repurchase of debt or potential new issuances of debt or equity securities to support our business needs. The amounts involved in these transactions, if any, may be material. In addition, as necessary or desirable, we may adjust or amend the terms of and/or expand the capacity of the Unsecured Facility, or enter into additional letter of credit facilities, or other similar facility arrangements, in each case with the same or other financial institutions, or allow any such facilities to mature or expire.

Debt

We generally fulfill our short-term cash requirements with cash generated from our operations and available borrowings. Additionally, our Unsecured Facility provides working capital and letter of credit capacity of $365.0 million, which includes a letter of credit capacity of $100.0 million. As of September 30, 2025, no borrowings and $41.4 million letters of credit were outstanding under the Unsecured Facility, resulting in a remaining borrowing capacity of $323.6 million. See Note 7 of the notes to the consolidated financial statements in this Form 10-K for further discussion.

In the future, we may from time to time seek to continue to retire or purchase our outstanding debt through cash repurchases or in exchange for other debt securities, in open market purchases, privately negotiated transactions, or otherwise. In addition, any material variance from our projected operating results could require us to obtain additional equity or debt financing. There can be no assurance that we will be able to complete any of these transactions in the future on favorable terms or at all. See Note 7 of the notes to the consolidated financial statements in this Form 10-K for additional details related to our borrowings.

Supplemental Guarantor Information

As discussed in Note 7 of the notes to the consolidated financial statements in this Form 10-K, the Company's obligations to pay principal and interest under certain debt agreements are guaranteed on a joint and several basis by substantially all of the Company's subsidiaries. Some of the immaterial subsidiaries do not guarantee the Senior Notes. The guarantees are full and unconditional. Summarized financial information is not presented for Beazer Homes USA, Inc. and the guarantor subsidiaries on a combined basis as the assets, liabilities and results of operations of the combined issuer and guarantors of the guaranteed security are not materially different than corresponding amounts presented in the consolidated financial statements of the parent company.

Credit Ratings

Our credit ratings are periodically reviewed by rating agencies. In November 2025, S&P revised the Company’s corporate credit rating from B+ to B and revised the Company's outlook from negative to stable. In September 2025, Moody's reaffirmed the Company's issuer corporate family rating of B1 and reaffirmed the Company's outlook of stable. In addition, our Senior Notes have a rating of B and B1 per S&P and Moody's, respectively. These ratings and our current credit condition affect, among other things, our ability to access new capital. These ratings are not recommendations to buy, sell or hold debt securities. Negative changes to these ratings may result in more stringent covenants and higher interest rates under the terms of any new debt. Our credit ratings could be lowered, or rating agencies could issue adverse commentaries in the future, which could have a material adverse effect on our business, financial condition, results of operations, and liquidity. In particular, a weakening of our financial condition, including any further increase in our leverage or decrease in our profitability or cash flows, could adversely affect our ability to obtain necessary funds, could result in a credit rating downgrade or change in outlook, or could otherwise increase our cost of borrowing.

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Stock Repurchases and Dividends Paid

In April 2025, the Company's Board of Directors approved a new share repurchase program that authorizes the Company to repurchase up to $100.0 million of its outstanding common stock. The newly authorized program replaced the prior share repurchase program authorized in May 2022 of up to $50.0 million of common stock repurchases, pursuant to which $8.3 million of the capacity remained prior to the replacement of the program. Under our share repurchase programs, the Company repurchased 1.5 million shares of its common stock for $33.1 million at an average price per share of $22.20 during the fiscal year ended September 30, 2025 through open market transactions. All shares have been retired upon repurchase. The aggregate reduction to stockholders' equity related to share repurchases during the fiscal year ended September 30, 2025 was $33.1 million. As of September 30, 2025, the remaining availability of the share repurchase program was $87.5 million.

During the fiscal year ended September 30, 2024, the Company repurchased 455 thousand shares of its common stock for $12.9 million at an average price per share of $28.41 through open market transactions. The aggregate reduction to stockholders’ equity related to share repurchases during the fiscal year ended September 30, 2024 was $12.9 million.

The indentures under which our Senior Notes were issued contain certain restrictive covenants, including limitations on our payment of dividends. There were no dividends paid during our fiscal years ended September 30, 2025, 2024 or 2023.

Off-Balance Sheet Arrangements and Aggregate Contractual Commitments

Lot Option Agreements

In addition to purchasing land directly, we control a portion of our land supply through lot option agreements with land developers and land bankers, which generally require the payment of cash or issuance of an irrevocable letter of credit or surety bond for the right to acquire lots during a specified period of time at a specified price. In recent years, we have focused on increasing our lot option agreement usage to minimize risk as we grow our land position. As of September 30, 2025, we controlled 25,660 lots, which includes 251 lots of land held for future development and 651 lots of land held for sale. Of the 24,758 total active lots, we controlled 15,373 of these lots, or 62.1%, through option agreements, as compared to 16,125 active lots controlled, or 57.8% of our total active lots, through option agreements as of September 30, 2024. Lot option agreements allow us to position for future growth while providing the flexibility to respond to market conditions by renegotiating the terms of the options prior to exercise or terminating the agreement.

Under option agreements, purchase of the properties is contingent upon satisfaction of certain requirements by us and the sellers, and our liability is generally limited to forfeiture of the non-refundable deposits, letters of credit or surety bonds, and other non-refundable amounts incurred, which totaled $333.4 million as of September 30, 2025. The total remaining purchase price, net of cash deposits, committed under all options was $1.61 billion as of September 30, 2025. Subject to market conditions and our liquidity, we may further expand our use of option agreements to supplement our owned inventory supply.

We expect to exercise, subject to market conditions and seller satisfaction of contract terms, most of our option agreements. Various factors, some of which are beyond our control, such as market conditions, weather conditions, and the timing of the completion of development activities, will have a significant impact on the timing of option exercises or whether lot options will be exercised at all.

We have historically funded the exercise of lot options with operating cash flows. We expect these sources to continue to be adequate to fund anticipated future option exercises. Therefore, we do not anticipate that the exercise of our lot options will have a material adverse effect on our liquidity.

Letters of Credit and Surety Bonds

In connection with the development of our communities, we are frequently required to provide performance, maintenance, and other bonds and letters of credit in support of our related obligations with respect to such developments. The amount of such obligations outstanding at any time varies in accordance with our pending development activities. In the event any such bonds or letters of credit are drawn upon, we would be obligated to reimburse the issuer of such bonds or letters of credit. We had outstanding letters of credit and surety bonds of $41.4 million and $321.9 million, respectively, as of September 30, 2025, primarily related to our obligations to local governments to construct roads and other improvements in various developments.

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Contractual Commitments

The following table summarizes our aggregate contractual commitments as of September 30, 2025:

Payments Due by Period

in thousands

Total

Less than 1 Year

1-3 Years

3-5 Years

More than 5 Years

Senior notes and junior subordinated notes(a)

$

1,058,028 

$

— 

$

357,255 

$

350,000 

$

350,773 

Interest commitments under senior notes and junior subordinated notes(b)

397,845 

72,989 

135,485 

104,002 

85,369 

Obligations related to lots under option

1,610,171 

639,196 

726,167 

225,199 

19,609 

Operating leases

32,924 

8,738 

11,707 

6,926 

5,553 

Uncertain tax positions(c)

— 

— 

— 

— 

— 

Total

$

3,098,968 

$

720,923 

$

1,230,614 

$

686,127 

$

461,304 

(a) For a listing of our borrowings, refer to Note 7 of the notes to the consolidated financial statements in this Form 10-K.

(b) Interest on variable rate obligations is based on rates effective as of September 30, 2025.

(c) Based on its current inventory of uncertain tax positions and tax carryforward attributes, the Company does not expect a cash settlement of unrecognized tax benefits related to uncertain tax positions in future years. See Note 12 of the notes to the consolidated financial statements in this Form 10-K for additional information regarding the Company's unrecognized tax benefits related to uncertain tax positions as of September 30, 2025.

We had outstanding letters of credit and surety bonds of $41.4 million and $321.9 million, respectively, as of September 30, 2025, primarily related to our obligations to local governments to construct roads and other improvements in various developments.

Critical Accounting Estimates

Our critical accounting policies require the use of judgment in their application and in certain cases require estimates of inherently uncertain matters. Although our accounting policies are in compliance with accounting principles generally accepted in the United States of America (GAAP), a change in the facts and circumstances of the underlying transactions could significantly change the application of the accounting policies and the resulting financial statement impact. Listed below are those policies that we believe are critical and require the use of complex judgment in their application.

Inventory Valuation - Projects in Progress

Projects in progress inventory includes homes under construction and land under development grouped together as communities. Generally, upon the commencement of land development activities, it may take three to five years (depending on, among other things, the size of the community and its sales pace) to fully develop, sell, construct and close all the homes in a typical community. Projects in progress are stated at cost unless facts and circumstances indicate that the carrying value of the assets may not be recoverable.

We assess our projects in progress inventory for indicators of impairment at the community level on a quarterly basis. We evaluate, among other things, the average sales price and margins on recent home closings, homes in backlog and expected future home sales for each community. If indicators of impairment are present for a community with more than ten homes remaining to close, we perform a recoverability test by comparing the expected undiscounted cash flows for the community to its carrying value. For those communities whose carrying values exceed the aggregate undiscounted cash flows, we perform a discounted cash flow analysis to determine the fair value of the community, and impairment charges are recorded if the fair value of the community's inventory is less than its carrying value.

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There is uncertainty associated with preparing the undiscounted cash flow analyses because future market conditions will almost certainly be different, either better or worse, than current conditions. Significant valuation assumptions include expected pace of closings, average sales price, expected costs for land development, direct construction, overhead, and interest. The risk of over or under-stating any of the important cash flow variables is greater with longer-lived communities and within markets that have historically experienced greater home price volatility. To address these risks, we consider home price and construction cost appreciation in future years for certain communities that are expected to be selling for more than a year and/or if the market has typically exhibited high levels of price volatility. Absent these assumptions on cost and sales price appreciation, we believe the long-term cash flow analysis would be unrealistic. Finally, we also ensure that the pace of sales and closings used in our undiscounted cash flow analyses are reasonable by considering seasonal variations in sales and closings, our development schedules and what we have achieved historically, and by comparing them to those achieved by our competitors for comparable communities.

The fair value of the community is estimated based on the present value of the estimated future cash flows using discount rates commensurate with the risk associated with the underlying community. The discount rate used may be different for each community. The factors considered when determining an appropriate discount rate for a community include, among others: (1) community specific factors such as product types, development stage and expected duration of the project, and the competitive factors influencing the sales performance of the community and (2) local market factors such as employment levels, consumer confidence and the existing supply of new and used homes for sale. The assumptions used in the determination of fair value of projects in progress communities are based on factors known to us at the time such estimates are made and our expectations of future operations and market conditions. Due to uncertainties in the estimation process, the significant volatility in market conditions, the long life cycles of many communities, and potential changes in our strategy related to certain communities, actual results could differ significantly from our estimates.

Warranty Reserves

The adequacy of our warranty reserves is based on historical experience and management's estimate of the costs to remediate any claims. Our review includes a quarterly analysis of the historical data and trends in warranty expense by division. An analysis by division allows us to consider market specific factors such as our warranty experience, the number of home closings, the prices of homes, product mix, and other data in estimating our warranty reserves. In addition, our analysis also factors in the existence of any non-recurring or community-specific warranty matters that might not be contemplated in our historical data and trends that may need to be separately estimated based on management's judgment of the ultimate cost of repair for that specific issue.

At September 30, 2025, our warranty reserve was $13.6 million, reflecting an accrual range of 0.3% to 0.9% of total revenue recognized for each home closed depending on our loss history in the division in which the home was built. A ten basis point increase in our warranty reserve rate would have increased our accrual and corresponding cost of sales by $2.6 million as of September 30, 2025.

There were no material changes in assumptions in calculating our reserve balance for the year ended September 30, 2025.

Our estimation process is discussed in Note 8 of notes to the consolidated financial statements in this Form 10-K. While we believe that our current warranty reserves are adequate, there can be no assurances that historical data and trends will accurately predict our actual warranty costs or that future developments might not lead to a significant change in the reserve.

Income Taxes - Valuation Allowance

The carrying amounts of deferred tax assets are reduced by a valuation allowance if an assessment of their components indicates that it is more likely than not that all or some portion of these assets will not be realized. Judgment is required in estimating valuation allowances for deferred tax assets. The realization of a deferred tax asset ultimately depends on the existence of sufficient taxable income in either the carryback or carryforward periods under tax law. We assess the need for valuation allowances for deferred tax assets based on more-likely-than-not realization threshold criteria. In our assessment, appropriate consideration is given to all positive and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature, frequency and severity of any current and cumulative losses, forecasts of future profitability, the duration of statutory carryforward periods, our experience with operating loss and tax credit carryforwards not expiring unused, the Section 382 and Section 383 limitation on our ability to carryforward pre-ownership change net operating losses, tax credits and certain built-in losses or deductions, and tax planning alternatives.

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Our assessment of the need for the valuation of deferred tax assets includes assessing the likely future tax consequences of events that have been recognized in our financial statements or tax returns. We base our estimate of deferred tax assets and liabilities on current tax laws and rates and, in certain cases, business plans and other expectations about future outcomes. Changes in existing tax laws or rates could affect actual tax results and future business results may affect the amount of deferred tax liabilities or the valuation of deferred tax assets over time. Our analysis includes several scenarios with both increases and decreases in our estimates of operating income across future periods. Routine or cyclical reductions in our pre-tax earnings would not have changed our assessment of our ability to utilize various tax carryforwards. In addition to various company-specific factors, we consider several positive and negative external factors that may impact our estimates. These factors may include broad economic considerations such as mortgage interest rates, the relative health of the U.S. economy and employment levels, as well as industry or market specific factors such as housing supply and demand outlook.

In fiscal 2025, our conclusions about our ability to more likely than not realize all of our federal and certain state tax attributes remain consistent with our prior determinations. We considered positive factors including our sustained tax profitability, interest savings from our debt reduction strategies, shortage in housing supply, and our backlog. The negative factors included the overall health of the broader economy, elevated mortgage interest rates, and softening housing demand due to affordability challenges.

Our accounting for deferred tax consequences represents our best estimate of future events. It is possible there will be changes that are not anticipated in our current estimates. If those changes resulted in significant and sustained reductions in our pre-tax earnings or our utilization of existing tax carryforwards, it is likely such changes would have a material impact on our financial condition or results of operations. The nature and amounts of the various tax attributes comprising our deferred tax assets are discussed in Note 12 of notes to the consolidated financial statements in this Form 10-K.