# NVR INC (NVR) Informational only - not investment advice. CIK: 0000906163 SIC: 1531 Operative Builders SIC breadcrumb: [Construction](/division/C/) > [Building Construction General Contractors And Operative Builders](/major-group/15/) > [SIC 1531 Operative Builders](/industry/1531/) Latest 10-K filed: 2026-02-11 SEC page: https://www.sec.gov/edgar/browse/?CIK=906163 Filing source: https://www.sec.gov/Archives/edgar/data/906163/000090616326000018/nvr-20251231.htm ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 10323959000 | USD | 2025 | 2026-02-11 | | Net income | 1339816000 | USD | 2025 | 2026-02-11 | | Assets | 5856930000 | USD | 2025 | 2026-02-11 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000906163.json. Derived margins are computed from the extracted annual SEC facts. | Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Revenue | 5,822,544,000 | 6,305,840,000 | 7,163,674,000 | 7,388,664,000 | 7,536,923,000 | 8,951,025,000 | 10,526,434,000 | 9,518,202,000 | 10,524,479,000 | 10,323,959,000 | | Net income | 425,262,000 | 537,521,000 | 797,197,000 | 878,539,000 | 901,248,000 | 1,236,719,000 | 1,725,575,000 | 1,591,611,000 | 1,681,928,000 | 1,339,816,000 | | Diluted EPS | 103.61 | 126.77 | 194.80 | 221.13 | 230.11 | 320.48 | 491.82 | 463.31 | 506.69 | 436.55 | | Assets | 2,643,943,000 | 2,989,279,000 | 3,165,933,000 | 3,809,815,000 | 5,777,141,000 | 5,834,475,000 | 5,660,973,000 | 6,601,757,000 | 6,380,988,000 | 5,856,930,000 | | Liabilities | 1,339,502,000 | 1,383,787,000 | 1,357,371,000 | 1,468,571,000 | 2,674,067,000 | 2,832,097,000 | 2,154,124,000 | 2,237,032,000 | 2,170,916,000 | 1,992,061,000 | | Stockholders' equity | 1,304,441,000 | 1,605,492,000 | 1,808,562,000 | 2,341,244,000 | 3,103,074,000 | 3,002,378,000 | 3,506,849,000 | 4,364,725,000 | 4,210,072,000 | 3,864,869,000 | | Net margin | 7.30% | 8.52% | 11.13% | 11.89% | 11.96% | 13.82% | 16.39% | 16.72% | 15.98% | 12.98% | ## Macro Cross-References - [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average - [UNRATE](/indicator/UNRATE/): Unemployment Rate - [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate - [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private - [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit - [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit - [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity - [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity - [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity - [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity - [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity - [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy - [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food - [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy - [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter - [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index - [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index - [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities - [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate - [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons - [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm - [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate - [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio - [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed - [CE16OV](/indicator/CE16OV/): Employment Level - [ICSA](/indicator/ICSA/): Initial Claims - [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm - [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm - [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product - [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period - [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index - [TCU](/indicator/TCU/): Capacity Utilization: Total Index - [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units - [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units - [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade - [PCE](/indicator/PCE/): Personal Consumption Expenditures - [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income - [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate - [M2SL](/indicator/M2SL/): M2 - [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance ## Latest 10-K MD&A Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.     (dollars in thousands, except per share data) Results of Operations This section of this Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2023 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Overview Business Environment and Current Outlook Demand for new homes continues to be negatively impacted by affordability issues, high home inventory levels in certain markets, declining consumer confidence and economic volatility. As a result of this weak demand environment in the second half of 2025, we repositioned many communities to better compete for a reduced number of buyers. We expect these adjustments to have a materially negative impact on our gross margins during the first half of 2026 as the homes in our backlog settle. We also expect a significant decline in revenues in the first quarter of 2026 due to weak orders in the third quarter of 2025 and strong fourth quarter 2025 backlog turnover. We expect this weak demand environment may continue to weigh on home sales, home prices and gross margins during 2026. Although we are unable to predict the extent to which this will impact our operational and financial performance, we believe that we are well positioned to take advantage of opportunities that may arise from future economic and homebuilding market volatility due to the strength of our balance sheet and our disciplined lot acquisition strategy. Business Our primary business is the construction and sale of single-family detached homes, townhomes and condominiums, all of which are primarily constructed on a pre-sold basis. To fully serve customers of our homebuilding operations, we also operate a mortgage banking and title services business. We primarily conduct our operations in mature markets. Additionally, we generally grow our business through market share gains in our existing markets and by expanding into markets contiguous to our current active markets. Our four homebuilding reportable segments consist of the following regions:  Mid Atlantic: Maryland, Virginia, West Virginia, Delaware and Washington, D.C. North East: New Jersey and Eastern Pennsylvania Mid East: New York, Ohio, Western Pennsylvania, Indiana and Illinois South East: North Carolina, South Carolina, Georgia, Florida, Tennessee and Kentucky Our lot acquisition strategy is predicated upon avoiding the financial risks associated with direct land ownership and development. We generally do not engage in land development (see discussion below of our land development activities). Instead, we typically acquire finished lots from various third-party land developers pursuant to LPAs. These LPAs require deposits, typically ranging up to 10% of the aggregate purchase price of the finished lots, in the form of cash or letters of credit that may be forfeited if we fail to perform under the LPA. This strategy has allowed us to maximize inventory turnover, which we believe enables us to minimize market risk and to operate with less capital, thereby enhancing rates of return on equity and total capital. In addition to constructing homes primarily on a pre-sold basis and utilizing what we believe is a conservative lot acquisition strategy, we focus on obtaining and maintaining a leading market position in each market we serve. This strategy allows us to gain valuable efficiencies and competitive advantages in our markets, which we believe contributes to minimizing the adverse effects of regional economic cycles and provides growth opportunities within these markets. Our continued success is contingent upon our ability to control an adequate supply of finished lots on which to build. In certain specific strategic circumstances, we deviate from our historical lot acquisition strategy and engage in joint venture arrangements with land developers or directly acquire raw ground already zoned for its intended use for development. Once we acquire raw ground, we determine whether to sell the raw parcel to a developer and enter into an LPA with the developer to purchase the finished lots or to hire a developer to develop the land on our behalf. While joint venture arrangements and direct land development activity are not our preferred method of acquiring finished building lots, we may enter into additional transactions in the future on a limited basis where there exists a compelling strategic or prudent financial reason to do so. We expect, however, to continue to acquire substantially all of our finished lot inventory using LPAs with forfeitable deposits. 13 Table of Contents As of December 31, 2025, we controlled approximately 180,100 lots as described below. Lot Purchase Agreements ("LPAs") We controlled approximately 169,250 lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately $920,100 and $4,600, respectively. Included in the number of controlled lots are approximately 18,200 lots for which we have recorded a contract land deposit impairment allowance of approximately $111,000 as of December 31, 2025. Joint Venture Limited Liability Corporations (“JVs”) We had an aggregate investment totaling approximately $78,100 in five JVs, expected to produce approximately 8,900 lots. Of the lots to be produced by the JVs, approximately 8,550 lots were controlled by us and approximately 350 lots were either under contract with unrelated parties or currently not under contract. We had additional funding commitments totaling approximately $34,100 to three of the JVs as of December 31, 2025. Land Under Development We owned land with a carrying value of approximately $39,300 that we expect to be developed into approximately 2,300 finished lots. See Notes 3, 4 and 5 to the consolidated financial statements included herein for additional information regarding LPAs, JVs and land under development, respectively. Raw Land Purchase Agreements In addition to the lots we currently control as discussed above, we have certain properties under contract with land owners that are expected to yield approximately 38,200 lots. Some of these properties may require rezoning or other approvals to achieve the expected yield. These properties are controlled with cash deposits totaling approximately $42,300 as of December 31, 2025, of which approximately $9,000 is refundable if we do not perform under the contract. We generally expect to assign the raw land contracts to a land developer and simultaneously enter into an LPA with the assignee if the project is determined to be feasible. Key Financial Results Our consolidated revenues for the year ended December 31, 2025 totaled $10,323,959, a decrease of 2% from $10,524,479 in 2024. Our net income for 2025 was $1,339,816, or $436.55 per diluted share, decreases of 20% and 14% compared to 2024 net income and diluted earnings per share, respectively. Our homebuilding gross profit margin percentage was 21.2% in 2025 compared to 23.7% in 2024. Settlements for the year ended December 31, 2025 totaled 21,915 units, a decrease of 4% from 2024. New orders, net of cancellations (“New Orders”) during 2025 totaled 20,410 units, a decrease of 10% from 2024 while our average New Order sales price remained relatively flat year over year. Our backlog of homes sold but not yet settled with the customer as of December 31, 2025 decreased on a unit basis by 15% to 8,448 units and decreased on a dollar basis by 16% to $4,008,043 when compared to December 31, 2024. Income before tax from our mortgage banking segment totaled $152,049 in 2025, a decrease of 2% when compared to $154,935 in 2024. Homebuilding Operations The following table summarizes the results of our consolidated homebuilding operations and certain operating activity for each of the last three years: Year Ended December 31, 2025 2024 2023 Financial data: Revenues $ 10,094,269  $ 10,292,425  $ 9,314,605  Cost of sales $ 7,953,401  $ 7,850,549  $ 7,051,198  Gross profit margin percentage 21.2  % 23.7  % 24.3  % Selling, general and administrative expenses $ 599,667  $ 598,207  $ 588,962  Operating data: New orders (units) 20,410  22,560  21,729  Average new order price $ 456.2  $ 457.7  $ 448.4  Settlements (units) 21,915  22,836  20,662  Average settlement price $ 460.6  $ 450.7  $ 450.7  Backlog (units) 8,448  9,953  10,229  Average backlog price $ 474.4  $ 481.4  $ 465.0  New order cancellation rate 17.0  % 14.2  % 12.8  % 14 Table of Contents Consolidated Homebuilding Homebuilding revenues decreased 2% in 2025 compared to 2024, as a result of a 4% decrease in the number of units settled. The decrease in the number of units settled was primarily attributable to a 3% lower backlog unit balance entering 2025 compared to the same period in 2024, coupled with an 11% decrease in new orders in the first six months of 2025 compared to the same period in 2024. Gross profit margin percentage in 2025 decreased to 21.2% from 23.7% in 2024. Gross profit margins were negatively impacted by higher lot costs, pricing pressure due to continued affordability challenges and contract land deposit impairments totaling approximately $75,900 in 2025. The number of New Orders decreased 10% in 2025 compared to 2024. New Orders were negatively impacted by an 11% lower sales absorption, due to weaker demand. Selling, general and administrative ("SG&A") expenses in 2025 were relatively flat when compared to 2024. While overall SG&A expenses were relatively flat, sales and marketing, office, legal and insurance expenses were all modestly higher year over year. These increases were offset by a decrease of approximately $36,100 in incentive compensation costs year over year due to weaker company performance. Our backlog represents homes sold but not yet settled with our customers. As of December 31, 2025, our backlog decreased on a unit basis by 15% to 8,448 units, and decreased on a dollar basis by 16% to $4,008,043 when compared to 9,953 units and $4,791,870, respectively, as of December 31, 2024. The decrease in backlog units was attributable to a 10% decrease in New Orders year over year, coupled with a higher backlog turnover rate in 2025. Backlog dollars were lower primarily due to the decrease in backlog units in 2025. Our backlog may be impacted by customer cancellations for various reasons that are beyond our control, such as failure to obtain mortgage financing, inability to sell an existing home, job loss, or a variety of other reasons.  In any period, a portion of the cancellations that we experience are related to new sales that occurred during the same period, and a portion are related to sales that occurred in prior periods and therefore appeared in the opening backlog for the current period. Our cancellation rate was approximately 17%, 14% and 13% in 2025, 2024, and 2023, respectively, calculated as the total of all cancellations during the period as a percentage of gross sales during the same period. During the four quarters of each of 2025, 2024, and 2023, approximately 6%, 5% and 4% of a reporting quarter’s opening backlog, respectively, cancelled during the quarter. We can provide no assurance that our historical cancellation rates are indicative of the actual cancellation rate that may occur in future years. Other than units that are cancelled, we expect to settle substantially all of our December 31, 2025 backlog during 2026. See “Risk Factors” in Item 1A of this Form 10-K. The rate at which we turn over our backlog is impacted by various factors, including, but not limited to, changes in New Order activity, internal production capacity, external subcontractor capacity, building material availability and other external factors over which we do not exercise control. Reportable Homebuilding Segments Homebuilding segment profit includes all revenues and income generated from the sale of homes, less the cost of homes sold, SG&A expenses, and a corporate capital allocation charge determined by corporate management. The corporate capital allocation charge eliminates in consolidation and is based on the segment’s average net assets employed. The corporate capital allocation charged to the operating segment allows the Chief Operating Decision Maker to determine whether the operating segment is providing the desired rate of return after covering our cost of capital. We record charges on contract land deposits when we determine that it is probable that recovery of the deposit is impaired. For segment reporting purposes, impairments on contract land deposits are generally charged to the operating segment upon the termination of an LPA with the developer, or the restructuring of an LPA resulting in the forfeiture of the deposit. We evaluate our entire net contract land deposit portfolio for impairment each quarter. For presentation purposes below, the contract land deposit impairment allowance as of December 31, 2025 and 2024 has been allocated to the reportable segments for the respective years to show contract land deposits on a net basis. The net contract land deposit balances below also include approximately $4,600 and $8,700 as of December 31, 2025 and 2024, respectively, of letters of credit issued as deposits in lieu of cash. 15 Table of Contents The following tables summarize certain homebuilding operating activity by reportable segment for each of the last three years: Selected Segment Financial Data: Year Ended December 31, 2025 2024 2023 Revenues: Mid Atlantic $ 4,372,010  $ 4,423,768  $ 4,189,957  North East 1,202,411  1,165,873  948,289  Mid East 1,875,046  1,861,735  1,723,514  South East 2,644,802  2,841,049  2,452,845  Year Ended December 31, 2025 2024 2023 Gross profit margin: Mid Atlantic $ 1,019,462  $ 1,105,469  $ 1,023,993  North East 306,742  303,650  243,634  Mid East 395,999  414,449  372,671  South East 484,499  634,847  629,843  Year Ended December 31, 2025 2024 2023 Gross profit margin percentage: Mid Atlantic 23.3  % 25.0  % 24.4  % North East 25.5  % 26.0  % 25.7  % Mid East 21.1  % 22.3  % 21.6  % South East 18.3  % 22.3  % 25.7  % Year Ended December 31, 2025 2024 2023 Segment profit: Mid Atlantic $ 722,599  $ 816,255  $ 745,323  North East 213,546  217,225  169,012  Mid East 266,990  290,834  257,865  South East 202,011  388,158  440,538  Segment Operating Activity: Year Ended December 31, 2025 2024 2023 Units Average Price Units Average Price Units Average Price New orders, net of cancellations: Mid Atlantic 7,379  $ 520.0  8,511  $ 527.3  8,434  $ 515.5  North East 1,778  $ 638.3  1,994  $ 622.4  1,879  $ 573.2  Mid East 4,066  $ 426.5  4,654  $ 408.0  4,514  $ 396.5  South East 7,187  $ 362.5  7,401  $ 364.6  6,902  $ 366.4  Total 20,410  $ 456.2  22,560  $ 457.7  21,729  $ 448.4  16 Table of Contents Year Ended December 31, 2025 2024 2023 Units Average Price Units Average Price Units Average Price Settlements: Mid Atlantic 8,287  $ 527.6  8,537  $ 518.1  8,032  $ 521.5  North East 1,860  $ 646.5  1,967  $ 592.6  1,736  $ 546.2  Mid East 4,478  $ 418.7  4,585  $ 406.0  4,391  $ 392.4  South East 7,290  $ 362.8  7,747  $ 366.7  6,503  $ 377.2  Total 21,915  $ 460.6  22,836  $ 450.7  20,662  $ 450.7  Year Ended December 31, 2025 2024 2023 Units Average Price Units Average Price Units Average Price Backlog: Mid Atlantic 3,160  $ 527.8  4,068  $ 541.6  4,094  $ 522.5  North East 973  $ 644.0  1,055  $ 658.1  1,028  $ 602.0  Mid East 1,633  $ 435.2  2,045  $ 416.5  1,976  $ 412.1  South East 2,682  $ 373.9  2,785  $ 374.3  3,131  $ 378.4  Total 8,448  $ 474.4  9,953  $ 481.4  10,229  $ 465.0   Operating Data: Year Ended December 31, 2025 2024 2023 New order cancellation rate: Mid Atlantic 16.8  % 13.4  % 12.8  % North East 15.7  % 14.4  % 11.9  % Mid East 16.6  % 15.5  % 13.9  % South East 17.6  % 14.4  % 12.3  % Year Ended December 31, 2025 2024 2023 Average active communities: Mid Atlantic 125  147  166  North East 30  31  36  Mid East 96  101  110  South East 181  148  115  Total 432  427  427  Homebuilding Inventory: As of December 31, 2025 2024 Sold inventory: Mid Atlantic $ 595,369  $ 845,686  North East 220,684  229,152  Mid East 219,389  276,459  South East 386,759  402,967  Total (1) $ 1,422,201  $ 1,754,264  17 Table of Contents As of December 31, 2025 2024 Unsold lots and housing units inventory: Mid Atlantic $ 90,988  $ 100,897  North East 24,423  17,198  Mid East 29,253  23,091  South East 108,812  99,369  Total (1) $ 253,476  $ 240,555  (1)Total segment inventory differs from consolidated inventory due to certain consolidation adjustments necessary to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes. These consolidation adjustments are not allocated to our operating segments. Lots Controlled and Land Deposits: As of December 31, 2025 2024 Total lots controlled: Mid Atlantic 60,100  50,900  North East 19,000  17,000  Mid East 28,100  24,100  South East 72,900  70,400  Total 180,100  162,400  As of December 31, 2025 2024 Contract land deposits, net: Mid Atlantic $ 347,941  $ 258,333  North East 105,051  105,062  Mid East 85,515  65,147  South East 317,516  306,855  Total $ 856,023  $ 735,397  Mid Atlantic The Mid Atlantic segment had an approximate $93,700, or 11%, decrease in segment profit in 2025 compared to 2024. The decrease was due primarily to a decrease in gross profit margins to 23.3% in 2025 from 25.0% in 2024. Gross profit margins were negatively impacted by higher lot costs and pricing pressure due primarily to continued affordability challenges. Segment New Orders decreased 13% and the average sales price of New Orders decreased 1% in 2025 compared to 2024. New Orders were lower primarily due to a 15% decrease in the average number of active communities year over year. North East The North East segment had an approximate $3,700, or 2%, decrease in segment profit in 2025 compared to 2024, despite a 3% increase in segment revenues year over year. Segment profit was negatively impacted by a decrease in the segment's gross profit margin percentage to 25.5% in 2025 from 26.0% in 2024 due primarily to an increase in certain material costs. Segment revenues were favorably impacted by a 9% increase in the average settlement price year over year, offset by a 5% decrease in the number of units settled. The increase in the average settlement price was primarily attributable to a 9% higher average sales price of units in backlog entering 2025 compared to backlog entering 2024, coupled with a 9% increase in the average sales price of New Orders in the first six months of 2025 compared to the same period in 2024. The decrease in the number of units settled was primarily attributable to a decrease in the number of New Orders in the first six months of 2025 compared to the same period in 2024. Segment New Orders decreased 11% while the average sales price of New Orders increased 3%, respectively, in 2025 compared to 2024. New Orders were lower primarily due to a 6% decrease in the average number of active communities, coupled with a 5% lower sales absorption rate year over year due to weaker demand. The increase in the average sales price of New Orders was primarily attributable to a relative shift to higher priced communities in certain markets year over year. 18 Table of Contents Mid East The Mid East segment had an approximate $23,800, or 8%, decrease in segment profit in 2025 compared to 2024, due primarily to a decrease in gross profit margins to 21.1% in 2025 from 22.3% in 2024. Gross profit margin was negatively impacted by higher lot costs and certain operating costs, as well as by pricing pressure due primarily to continued affordability challenges. Segment New Orders decreased 13% while the average sales price of New Orders increased 5% in 2025 compared to 2024. New Orders were negatively impacted by a 9% lower sales absorption rate due to weaker demand and a 4% decrease in the average number of active communities year over year. The average sales price of New Orders was favorably impacted by a shift to higher priced communities in certain markets within the segments year over year. South East The South East segment had an approximate $186,100, or 48%, decrease in segment profit in 2025 compared to 2024. The decrease in segment profit was primarily due to a decrease in the segment's gross profit margin percentage, a decrease in segment revenues and increases in SG&A expenses and the corporate capital allocation charge. The segment's gross profit margin percentage decreased to 18.3% in 2025 from 22.3% in 2024. Gross profit margins were negatively impacted primarily by higher lot costs, an increase in certain operating costs, and an increase in lot deposit impairment charges year over year. Segment revenues in 2025 decreased by approximately $196,200, or 7%, due primarily to a 6% decrease in the number of units settled year over year. The decrease in the number of units settled is primarily attributable to an 11% lower backlog unit balance entering 2025 compared to backlog entering 2024, offset partially by a higher backlog turnover rate year over year. SG&A expenses were 12% higher year over year, resulting primarily from higher personnel and marketing costs attributable to a 23% increase in the average number of active communities year over year. Segment New Orders decreased 3% while the average sales price of New Orders remained flat year over year. The decrease in New Orders was primarily attributable to a 21% lower absorption rate due to weaker demand, offset partially by the aforementioned increase in the average number of active communities within the segment year over year. Absorption rates continue to be negatively impacted by rising resale and new home inventory in several of the markets within the segment. Homebuilding Segment Reconciliations to Consolidated Homebuilding Operations In addition to the corporate capital allocation and contract land deposit impairments discussed in Reportable Homebuilding Segments above, the other reconciling items between homebuilding segment profit and homebuilding consolidated profit before tax include unallocated corporate overhead (which includes all management incentive compensation), equity-based compensation expense, consolidation adjustments and external corporate interest expense. Our overhead functions, such as accounting, treasury and human resources, are centrally performed and the costs are not allocated to our operating segments. Consolidation adjustments consist of such items to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes, and are not allocated to our operating segments. External corporate interest expense is primarily comprised of interest charges on our Senior Notes, and is not charged to the operating segments because the charges are included in the corporate capital allocation discussed above.   Year Ended December 31, 2025 2024 2023 Homebuilding consolidated gross profit: Mid Atlantic $ 1,019,462  $ 1,105,469  $ 1,023,993  North East 306,742  303,650  243,634  Mid East 395,999  414,449  372,671  South East 484,499  634,847  629,843  Consolidation adjustments and other (1) (65,834) (16,539) (6,734) Homebuilding consolidated gross profit $ 2,140,868  $ 2,441,876  $ 2,263,407  (1)This increase in consolidation adjustments and other in 2025 was primarily attributable to the increase in the contract land deposit impairment allowance. See further discussion of contract land deposit impairment charges in Reportable Homebuilding Segments above. 19 Table of Contents Year Ended December 31, 2025 2024 2023 Homebuilding consolidated profit before taxes: Mid Atlantic $ 722,599  $ 816,255  $ 745,323  North East 213,546  217,225  169,012  Mid East 266,990  290,834  257,865  South East 202,011  388,158  440,538  Reconciling items: Contract land deposit impairment adjustment (2) (72,276) 6,228  3,279  Equity-based compensation expense (65,101) (69,659) (93,987) Corporate capital allocation (3) 368,698  330,897  288,805  Unallocated corporate overhead (146,123) (156,470) (175,208) Consolidation adjustments and other (4) 62,872  26,424  44,619  Corporate interest income 84,158  137,530  142,083  Corporate interest expense (27,491) (26,851) (26,749) Reconciling items sub-total 204,737  248,099  182,842  Homebuilding consolidated profit before taxes $ 1,609,883  $ 1,960,571  $ 1,795,580  (2)This item represents changes to the contract land deposit impairment allowance, which are not allocated to our reportable segments. See further discussion of contract land deposit impairment charges in Note 3 in the accompanying consolidated financial statements. (3)This item represents the elimination of the corporate capital allocation charge included in the respective homebuilding reportable segments. The corporate capital allocation charge is based on the segment’s monthly average asset balance and was as follows for the years presented: Year Ended December 31, 2025 2024 2023 Corporate capital allocation charge: Mid Atlantic $ 149,923  $ 139,780  $ 135,618  North East 46,106  40,614  33,269  Mid East 47,708  43,989  39,005  South East 124,961  106,514  80,913  Total corporate capital allocation charge 368,698  330,897  288,805  (4)     The consolidation adjustments and other in each period are primarily attributable to changes in units under construction year over year, and any significant changes in material costs, primarily lumber. Our reportable segments' results include the intercompany profits of our production facilities for home packages delivered to our homebuilding divisions. Costs related to homes not yet settled are reversed through the consolidation adjustment and recorded in inventory. These costs are subsequently recorded through the consolidation adjustment when the respective homes are settled. 20 Table of Contents Mortgage Banking Segment We conduct our mortgage banking activity through NVRM, a wholly owned subsidiary. NVRM focuses exclusively on serving the homebuilding segment customer base. The following table summarizes the results of our mortgage banking operations and certain statistical data for each of the last three years: Year Ended December 31, 2025 2024 2023 Loan closing volume: Total principal $ 6,039,621  $ 6,260,428  $ 5,736,532  Loan volume mix: Adjustable rate mortgages 7  % 2  % 2  % Fixed-rate mortgages 93  % 98  % 98  % Operating profit: Segment profit $ 156,161  $ 159,201  $ 138,313  Equity-based compensation expense (4,112) (4,266) (5,520) Mortgage banking income $ 152,049  $ 154,935  $ 132,793  Capture rate: 86  % 86  % 87  % Mortgage banking fees: Net gain on sale of loans $ 187,750  $ 188,544  $ 162,658  Title services 41,516  43,135  40,754  Servicing fees 424  375  185  $ 229,690  $ 232,054  $ 203,597  Loan closing volume in 2025 decreased by approximately $220,800, or 4%, from 2024.  The decrease was primarily attributable to a 5% decrease in the number of loans closed, resulting from a 4% decrease in the homebuilding segment’s number of homes settled in 2025 as compared to 2024. Segment profit in 2025 decreased by approximately $3,000, or 2%, from 2024, which was primarily attributable to a decrease in fees from title services. Mortgage Banking – Other We sell all of the loans we originate into the secondary mortgage market. To the extent we underwrite our originated loans to the standards and specifications of the ultimate investor, we have no further financial obligations from the issuance of loans, except in certain limited instances where repurchases or early payment defaults occur. Those underwriting standards are typically equal to or more stringent than the underwriting standards required by FNMA, GNMA, FHLMC, VA and FHA. Because we sell all of our loans (a small subset of such loans are serviced for a short period of time prior to sale), there is often a substantial delay between the time that a loan goes into default and the time that the investor requests us to reimburse them for losses incurred because of the default.  We believe that all of the loans that we originate are underwritten to the standards and specifications of the ultimate investor to whom we sell our originated loans. We employ a quality control department to ensure that our underwriting controls are effective, and further assess the underwriting function as part of our assessment of internal controls over financial reporting. We maintain a reserve for losses on mortgage loans originated that reflects our judgment of the present loss exposure from the loans that we have originated and sold. As of December 31, 2025 and 2024, we had repurchase reserves of approximately $18,900 and $18,700, respectively. NVRM is dependent on our homebuilding operation’s customers for business. If new orders and selling prices of the homebuilding segment decline, NVRM’s operations will also be adversely affected.  In addition, NVRM’s operating results may be adversely affected in future periods due to tightening and volatility of the credit markets, changes in investor funding times, increased regulation of mortgage lending practices and increased competition in the mortgage market. 21 Table of Contents Seasonality We historically have experienced variability in our quarterly results, generally having higher New Order activity in the first half of the year and higher home settlements, revenue and net income in the second half of the year. However, in recent years our typical seasonal trends have been affected by significant changes in market conditions. As a result, our quarterly results of operations are not necessarily indicative of the results that may be expected for the full year. Effective Tax Rate Our consolidated effective tax rates in 2025 and 2024 were 23.96% and 20.50%, respectively. The increase in the effective tax rate is primarily attributable to a lower income tax benefit recognized for excess tax benefits from stock option exercises, which totaled approximately $28,300 and $95,100 for 2025 and 2024, respectively. We expect continued tax rate volatility in future years attributable to the recognition of excess tax benefits from equity plan activity and distributions from the deferred compensation plans. Given the limited number of participants in our deferred compensation plan, the retirement of a participant could result in a significant distribution of the rabbi trust shares and corresponding tax deduction for the Company. Recent Accounting Pronouncements Pending Adoption See Note 1 to the accompanying consolidated financial statements for discussion of recently issued accounting pronouncements applicable to us. Liquidity and Capital Resources We fund our operations primarily from our current cash holdings and cash flows generated by operating activities. In addition, we have available a short-term unsecured working capital revolving credit facility and revolving mortgage repurchase facility, as further described below. As of December 31, 2025, we had a strong liquidity position with approximately $1,800,000 in cash and cash equivalents, approximately $290,000 in unused committed capacity under our revolving credit facility and $150,000 in unused committed capacity under our revolving mortgage repurchase facility. We believe that our current cash holdings and our anticipated cash flows generated by operating activities, together with the amounts under our revolving credit facility and revolving mortgage repurchase facility will be sufficient to fund our anticipated operations for at least the next twelve months and beyond. Material Cash Requirements We believe that our current cash holdings, cash generated from operations, and cash available under our short-term unsecured credit agreement and revolving mortgage repurchase facility, as well as the public debt and equity markets, will be sufficient to satisfy both our short-term and long-term cash requirements for working capital to support our daily operations and meet commitments under our contractual obligations with third parties. Our material contractual obligations primarily consist of the following: (i) Payments due to service our debt and interest on that debt. Our current outstanding Senior Notes total $900,000 and mature in May 2030. Future interest payments on our current outstanding Senior Notes total approximately $118,050, with $27,000 due within the next twelve months. (ii) Payment obligations totaling approximately $733,900 under existing LPAs for deposits to be paid to land developers, assuming that contractual development milestones are met by the developers and we exercise our option to acquire finished lots under those LPAs. We expect to make the majority of these payments within the next three years. (iii) Obligations under operating and finance leases related primarily to corporate and division offices, production facilities, model homes, and certain office and production equipment. See Note 11 of this Form 10-K for additional discussion of our leases. 22 Table of Contents In addition to funding growth in our homebuilding and mortgage banking operations, we historically have used a substantial portion of our excess liquidity to repurchase outstanding shares of our common stock in open market and privately negotiated transactions. This ongoing repurchase program assists us in accomplishing our primary objective, creating increases in shareholder value. See “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities” in Item 5 of this Form 10-K for disclosure of amounts repurchased during the fourth quarter of 2025. For the year ended December 31, 2025, we repurchased 243,082 shares of our common stock at an aggregate purchase price of $1,818,595. As of December 31, 2025, we had approximately $549,600 available under Board approved repurchase authorizations. Capital Resources Senior Notes As of December 31, 2025, we had a total of $900,000 in outstanding Senior Notes which mature in May 2030. Credit Agreement We have an unsecured revolving credit agreement (the "Credit Agreement") which provides for aggregate revolving loan commitments of $300,000, and a $100,000 sublimit for the issuance of letters of credit of which there was approximately $9,700 outstanding as of December 31, 2025. There were no borrowings outstanding under the Credit Agreement as of December 31, 2025. Repurchase Agreement Our mortgage banking subsidiary, NVRM, has an unsecured revolving mortgage repurchase facility (the "Repurchase Agreement") which provides for aggregate borrowing up to $150,000. As of December 31, 2025, there were no borrowings outstanding under the Repurchase Agreement. See Note 7 of this Form 10-K for additional information regarding our Senior Notes, Credit Agreement and Repurchase Agreement. Cash Flows For the year ended December 31, 2025, cash, restricted cash and cash equivalents decreased by $707,786. Net cash provided by operating activities was $1,121,320, due primarily to cash provided by earnings in 2025, and a decrease in inventory of $335,147 attributable to a decrease in units under construction year over year. Cash was primarily used to fund the increase in contract land deposits of $200,657 attributable to an increase in the number of lots under control as of December 31, 2025 compared to December 31, 2024, and net mortgage loan activity of $238,260. Net cash used in investing activities in 2025 was $71,208. Cash was used primarily to fund investments in unconsolidated joint ventures totaling $47,614 and purchases of property, plant and equipment of $24,508. Net cash used by financing activities in 2025 was $1,757,898. Cash was used primarily to repurchase 243,082 shares of our common stock at an aggregate purchase price of $1,833,316 under our ongoing common stock repurchase program, discussed above (which includes the associated excise tax payments). Cash was provided from stock option exercise proceeds totaling $80,146. For the year ended December 31, 2024, cash, restricted cash and cash equivalents decreased by $550,777. Net cash provided by operating activities was $1,374,462, due primarily to cash provided by earnings in 2024. Cash was primarily used to fund the increase in contract land deposits of $157,291 attributable to an increase in the number of lots under control as of December 31, 2024 compared to December 31, 2023, and net mortgage loan activity of $105,790. Additionally, cash was used to fund the increase in inventory of $108,557 attributable to an increase in units under construction year over year. Net cash used in investing activities in 2024 was $26,553. Cash was used primarily for purchases of property, plant and equipment of $29,212. Net cash used by financing activities in 2024 was $1,898,686. Cash was used primarily to repurchase 256,871 shares of our common stock at an aggregate purchase price of $2,057,677 under our ongoing common stock repurchase program, discussed above. Cash was provided from stock option exercise proceeds totaling $161,625. As of December 31, 2025 and 2024, restricted cash totaled $40,395 and $53,692, respectively. Restricted cash was attributable to customer deposits for certain home sales and cash collected from customers for loans in process and closed mortgage loans held for sale. Critical Accounting Policies and Estimates General The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. We continually evaluate the estimates we use to prepare 23 Table of Contents the consolidated financial statements and update those estimates as necessary. In general, our estimates are based on historical experience, on information from third-party professionals, and other various assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ materially from those estimates made by management. Homebuilding Inventory The carrying value of inventory is stated at the lower of cost or market value. Cost of lots and completed and uncompleted housing units represent the accumulated actual cost of the units. Field construction supervisors’ salaries and related direct overhead expenses are included in inventory costs. Interest costs are not capitalized into inventory, with the exception of land under development and joint venture investments, as applicable. Upon settlement, the cost of the unit is expensed on a specific identification basis. Cost of building materials is determined on a first-in, first-out basis. Sold inventory is evaluated for impairment based on the contractual sales price compared to the total estimated cost to construct. Unsold inventory is evaluated for impairment by analyzing recent comparable sales prices within the applicable community compared to the costs incurred to date plus the expected costs to complete. Any calculated impairments are recorded immediately in cost of sales. Contract Land Deposits We purchase finished lots under LPAs that require deposits that may be forfeited if we fail to perform under the contract. The deposits are in the form of cash or letters of credit in varying amounts and represent a percentage of the aggregate purchase price of the finished lots. We maintain an allowance for losses on contract land deposits that reflects our judgment of the present loss exposure in the existing contract land deposit portfolio at the end of the reporting period. To analyze contract land deposit impairments, we conduct a loss contingency analysis each quarter. In addition to considering market and economic conditions, we assess contract land deposit impairments on a community-by-community basis pursuant to the purchase contract terms, analyzing quantitative and qualitative information including, as applicable, current sales absorption levels, recent sales’ profit margin, the dollar differential between the contractual purchase price and the current market price for lots, a developer’s performance, a developer’s financial ability or willingness to reduce lot prices to current market prices, if necessary, and the contract’s default status by either us or the developer along with an analysis of the expected outcome of any such default. Our analysis is focused on whether we can sell houses at an acceptable profit margin and sales pace in a particular community in the current market. Because we do not own the finished lots on which we had placed a contract land deposit, if the above analysis leads to a determination that we cannot sell homes at an acceptable profit margin and sales pace at the current contractual lot price, we then determine whether we will elect to default under the contract, forfeit our deposit and terminate the contract, or whether we will attempt to restructure the LPA, which may require us to forfeit the deposit to obtain contract concessions from a developer. We also assess whether an impairment is present due to collectability issues resulting from a developer’s non-performance because of financial or other conditions. Although we consider the allowance for losses on contract land deposits reflected on the December 31, 2025 consolidated balance sheet to be adequate (see Note 1 to the accompanying consolidated financial statements included herein), there can be no assurance that this allowance will prove to be adequate over time to cover losses due to unanticipated adverse changes in the economy or other events adversely affecting specific markets or the homebuilding industry. Warranty/Product Liability Reserves We establish warranty and product liability reserves to provide for estimated future expenses as a result of construction and product defect claims, product recalls and litigation incidental to our homebuilding business. Liability estimates are determined based on our judgment considering such factors as historical experience, the likely current cost of corrective action, manufacturers’ and subcontractors’ participation in sharing the cost of corrective action, consultations with third-party experts such as engineers, and discussions with our General Counsel and outside counsel retained to handle specific product liability cases. Although we consider the warranty and product liability accrual reflected on the December 31, 2025 consolidated balance sheet to be adequate (see Note 12 to the accompanying consolidated financial statements included herein), there can be no assurance that this accrual will prove to be adequate over time to cover losses due to increased costs for material and labor, the inability or refusal of manufacturers or subcontractors to financially participate in corrective action, unanticipated adverse legal settlements, or other unanticipated changes to the assumptions used to estimate the warranty and product liability accrual. Equity-Based Compensation We recognize equity-based compensation expense within our income statement for all share-based payment arrangements, which include Options and RSUs. Compensation expense is based on the grant-date fair value of the Options and RSUs granted, and is recognized on a straight-line basis over the requisite service period for the entire award (from the date of grant through the period of the last separately vesting portion of the grant). Options and RSUs which are subject to a performance condition are treated as a separate award from the “service-only” Options and RSUs, and compensation expense is recognized when it becomes probable that the stated performance target will be achieved. We calculate the fair value of our Options, which are not publicly traded, using the 24 Table of Contents Black-Scholes option-pricing model. The grant date fair value of the RSUs is the closing price of our common stock on the day immediately preceding the date of grant. The reversal of compensation expense previously recognized for grants forfeited is recorded in the period in which the forfeiture occurs. As noted above, we calculate the fair value of our Options using the Black-Scholes option-pricing model. While the Black-Scholes model is a widely accepted method to calculate the fair value of options, its results are dependent on input variables, two of which, expected term and expected volatility, are significantly dependent on management’s judgment. We have concluded that our historical exercise experience is the best estimate of future exercise patterns to determine an Option’s expected term. To estimate expected volatility, we analyze the historical volatility of our common stock over a period equal to the Option’s expected term. Changes in management’s judgment of the expected term and the expected volatility could have a material effect on the grant-date fair value calculated and expensed within the income statement. In addition, when recognizing equity-based compensation cost related to “performance condition” Option and RSU grants, we are required to make a determination as to whether the performance conditions will be met prior to the completion of the actual performance period. The performance metric is based on our return on capital performance during a specified three year period based on the date of Option grant. While we currently believe that this performance condition will be satisfied at the target level and are recognizing compensation expense related to such Options and RSUs accordingly, our future expected activity levels could cause us to make a different determination, resulting in a change to the compensation expense to be recognized related to performance condition Option and RSU grants that would otherwise have been recognized to date.   Although we believe that the compensation costs recognized in 2025 are representative of the cumulative ratable amortization of the grant-date fair value of unvested Options and RSUs outstanding, changes to the estimated input values such as expected term and expected volatility and changes to the determination of whether performance condition grants will vest, could produce widely different expense valuations and recognition. Impact of Inflation, Changing Prices and Economic Conditions See “Risk Factors” included in Item 1A of this Form 10-K for a description of the impact of inflation, changing prices and economic conditions on our business and our financial results. See also the discussion of the current business environment in the Business Environment and Current Outlook section above.