NVR INC

Previous wording

Some of the statements in this Quarterly Report on Form 10-Q, as well as statements made by us in periodic press releases or other public communications, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “believes,” “expects,” “may,” “will,” “should,” "could," or “anticipates” or the negative thereof or other comparable terminology. All statements other than of historical facts are forward-looking statements. Forward-looking statements contained in this document may include those regarding market trends, our financial position and financial results, business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results or performance to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements. Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by us and our customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by us in our homebuilding operations; shortages of labor; the economic impact of a major epidemic or pandemic; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which we have little or no control. We undertake no obligation to update such forward-looking statements except as required by law. For additional information regarding risk factors and uncertainties, see Part II, Item 1A of this Quarterly Report on Form 10-Q and Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Current wording

Some of the statements in this Quarterly Report on Form 10-Q, as well as statements made by us in periodic press releases or other public communications, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “believes,” “expects,” “may,” “will,” “should,” "could," or “anticipates” or the negative thereof or other comparable terminology. All statements other than of historical facts are forward-looking statements. Forward-looking statements contained in this document may include those regarding market trends, our financial position and financial results, business strategy, the outcome of pending litigation, investigations or similar contingencies, and projected plans and objectives of management for future operations. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results or performance to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements. Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by us and our customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by us in our homebuilding operations; shortages of labor; the economic impact of a major epidemic or pandemic; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which we have little or no control. We undertake no obligation to update such forward-looking statements except as required by law. For additional information regarding risk factors and uncertainties, see Part II, Item 1A of this Quarterly Report on Form 10-Q and Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

Previous wording

Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024

Current wording

Results of Operations for the Three Months Ended March 31, 2026 and 2025

Previous wording

During the third quarter of 2025, demand for new homes continued to be negatively impacted by affordability issues, rising resale and new home inventory, declining consumer confidence and economic volatility. We expect that affordability issues, interest rate volatility and economic volatility may continue to weigh on demand and home prices. We also expect to continue to face margin pressure due to affordability issues and cost pressures. 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.

Current wording

During the first quarter of 2026, demand for new homes continued to be negatively impacted by affordability issues, high home inventory levels in certain markets, consumer sentiment and economic volatility. We expect that these issues may continue to weigh on demand and home prices. We also expect further margin pressure from higher land prices and from repositioning of communities as the housing market continues to adjust. 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.

Previous wording

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 control of 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 our finished lot inventory using LPAs with forfeitable deposits.

Current wording

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 generally sell the raw parcel to a developer and enter into an LPA with the developer to purchase the finished lots or, on a limited basis, 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 our finished lot inventory using LPAs with forfeitable deposits.

Previous wording

As of September 30, 2025, we controlled approximately 175,300 lots as described below.

Current wording

As of March 31, 2026, we controlled approximately 181,700 lots as described below.

Previous wording

We controlled approximately 166,050 lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately $907,600 and $4,000, respectively. Included in the number of controlled lots are approximately 15,000 lots for which we have recorded a contract land deposit impairment allowance of approximately $85,400 as of September 30, 2025.

Current wording

We controlled approximately 172,100 lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately $1,004,400 and $5,500, respectively. Included in the number of controlled lots are approximately 18,900 lots for which we have recorded a contract land deposit impairment allowance of approximately $113,500 as of March 31, 2026.

Previous wording

We had an aggregate investment totaling approximately $66,500 infive JVs, expected to produce approximately 7,300 lots. Of the lots to be produced by the JVs, approximately 6,950 lots were controlled by us and approximately 350 were either under contract with unrelated parties or currently not under contract. We had additional JV funding commitments totaling approximately $11,700 as of September 30, 2025.

Current wording

We had an aggregate investment totaling approximately $68,900 in four JVs, expected to produce approximately 8,150 lots. We had additional JV funding commitments totaling approximately $26,000 as of March 31, 2026.

Previous wording

We owned land with a carrying value of approximately $38,000 that we intend to develop into approximately 2,300 finished lots.

Current wording

We owned land with a carrying value of approximately $19,400 that we intend to develop into approximately 1,450 finished lots.

Previous wording

In addition, we have certain properties under contract with land owners that are expected to yield approximately 47,100 lots, which are not included in the number of total lots controlled. Some of these properties may require rezoning or other approvals to achieve the expected yield. As of September 30, 2025, these properties are controlled with deposits in cash totaling approximately $46,100, of which approximately $10,400 is refundable if certain contractual conditions are not met. 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.

Current wording

In addition, we have certain properties under contract with land owners that are expected to yield approximately 37,000 lots, which are not included in the number of total lots controlled. Some of these properties may require rezoning or other approvals to achieve the expected yield. As of March 31, 2026, these properties are controlled with deposits in cash totaling approximately $48,100, of which approximately $12,900 is refundable if certain contractual conditions are not met. 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.

Previous wording

Our consolidated revenues for the third quarter of 2025 totaled $2,609,505, a 5% decrease from the third quarter of 2024. Net income for the third quarter ended September 30, 2025 was $342,688, or $112.33 per diluted share. For the third quarter ended September 30, 2025, net income decreased 20% and diluted earnings per share decreased 14% when compared to net income and diluted earnings per share for the third quarter of 2024, respectively. Our homebuilding gross profit margin percentage decreased to 21.0% in the third quarter of 2025 from 23.4% in the third quarter of 2024. New orders, net of cancellations (“New Orders”) decreased by 16% in the third quarter of 2025 compared to the third quarter of 2024. The New Order cancellation rate for the third quarter of 2025 increased to 19.4% from 14.5% in the same period in 2024. The average sales price for New Orders in the third quarter of 2025 was $464.8, an increase of 3% compared to the third quarter of 2024.

Current wording

Our consolidated revenues for the first quarter of 2026 totaled $1,881,063, a 22% decrease from the first quarter of 2025. Net income for the first quarter ended March 31, 2026 was $198,359, or $67.76 per diluted share, decreases of 34% and 29% when compared to the first quarter of 2025, respectively. Our homebuilding gross profit margin percentage decreased to 19.6% in the first quarter of 2026 from 21.9% in the first quarter of 2025. New orders, net of cancellations (“New Orders”) increased by 7% in the first quarter of 2026 compared to the first quarter of 2025. The average sales price for New Orders in the first quarter of 2026 was $440.1, a decrease of 2% compared to the first quarter of 2025.

Previous wording

Homebuilding revenues decreased 4% in the third quarter of 2025 compared to the same period in 2024, as a result of a 5% decrease in the number of units settled. The decrease in the number of units settled was primarily attributable to a 13% lower backlog balance entering the third quarter of 2025 compared to the backlog unit balance entering the third quarter of 2024, offset partially by a higher backlog turnover rate. The gross profit margin percentage in the third quarter of 2025 decreased to 21.0%, from 23.4% in the third quarter of 2024. Gross profit margin was negatively impacted by higher lot costs, pricing pressure due to continued affordability challenges and contract land deposit impairments totaling approximately $18,900 in the third quarter of 2025, compared to approximately $3,900 in impairment charges in the third quarter of 2024.

Current wording

Homebuilding revenues decreased 22% in the first quarter of 2026 compared to the same period in 2025, as a result of a 22% decrease in the number of units settled. The decrease in the number of units settled was attributable to a 15% lower backlog unit balance entering 2026 compared to 2025, coupled with a lower backlog turnover rate quarter over quarter. The gross profit margin percentage in the first quarter of 2026 decreased to 19.6%, compared to 21.9% in the first quarter of 2025. Gross profit margin was negatively impacted by continued pricing pressure and higher lot costs.

Previous wording

Selling, general and administrative (“SG&A”) expense in the third quarter of 2025 decreased by approximately $7,000, or 5%, compared to the third quarter of 2024, and as a percentage of revenue remained flat at 5.6% quarter over quarter. The decrease in SG&A expense was primarily attributable to a decrease in incentive compensation expense based on current year company performance, offset partially by higher overhead costs associated with increased headcount quarter over quarter.

Current wording

Selling, general and administrative (“SG&A”) expense in the first quarter of 2026 decreased by approximately $8,100 compared to the first quarter of 2025, but increased as a percentage of revenue to 8.6% from 7.0%. The decrease in SG&A expense was primarily attributable to a decrease of approximately $4,700 in equity-based compensation and a decrease of approximately $3,500 in personnel costs due primarily to a decrease in headcount quarter over quarter.

Previous wording

Our backlog represents homes sold but not yet settled with our customers. As of September 30, 2025, our backlog decreased on a unit basis by 19% to 9,165 units and on a dollar basis by 17% to $4,394,695 when compared to 11,339 units and $5,323,366, respectively, as of September 30, 2024. The decrease in the number of backlog units was primarily attributable to a 13% decrease in New Orders year over year, coupled with a 3% lower backlog unit balance entering 2025 compared to the backlog unit balance entering 2024. Backlog dollars were lower primarily due to the decrease in backlog units in 2025.

Current wording

Our backlog represents homes sold but not yet settled with our customers. As of March 31, 2026, backlog on a unit basis remained flat at 10,171 units and on a dollar basis decreased 3% to $4,698,779 when compared to 10,165 units and $4,837,847, respectively, as of March 31, 2025.

Previous wording

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% and 14% in the first nine months of 2025 and 2024, respectively, calculated as the total of all cancellations during the period as a percentage of gross sales during the same period. During the most recent four quarters, approximately 6% of a reporting quarter’s opening backlog cancelled during the fiscal quarter. We can provide no assurance that our historical cancellation rates are indicative of the actual cancellation rate that may occur during the remainder of 2025 or future years. Other than units that are cancelled, we expect to settle substantially all of our September 30, 2025 backlog within the next twelve months.

Current wording

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 first quarter cancellation rate was approximately 14% and 16% for 2026 and 2025, respectively, calculated as the total of all cancellations during the period as a percentage of gross sales during that same period. During the most recent four quarters, approximately 6% of the quarter’s opening backlog cancelled during the fiscal quarter. We can provide no assurance that our historical cancellation rates are indicative of the actual cancellation rate that may occur during the remainder of 2026 or future years. Other than those units that are cancelled, we expect to settle substantially all of our March 31, 2026 backlog within the next twelve months.

Previous wording

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.

Current wording

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, regulatory approvals and other external factors over which we do not exercise control.

Previous wording

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 reserve as of September 30, 2025 and December 31, 2024 has been allocated to the respective year’s reportable segments to show contract land deposits on a net basis. The net contract land deposit balances below also include approximately $4,000 and $8,700 as of September 30, 2025 and December 31, 2024, respectively, of letters of credit issued as deposits in lieu of cash.

Current wording

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 allowance as of March 31, 2026 and December 31, 2025 has been allocated to the respective year’s reportable segments to show contract land deposits on a net basis. The net contract land deposit balances below also include approximately $5,500 and $4,600 as of March 31, 2026 and December 31, 2025, respectively, of letters of credit issued as deposits in lieu of cash.

Previous wording

The following tables summarize certain homebuilding operating activity by reportable segment for the three and nine months ended September 30, 2025 and 2024.

Current wording

The following tables summarize certain homebuilding operating activity by reportable segment for the three months ended March 31, 2026 and 2025.

Previous wording

The Mid Atlantic segment had an approximate $46,000, or 21%, decrease in segment profit in the third quarter of 2025 compared to the third quarter of 2024. This decrease was due primarily to a 9% decrease in segment revenues, coupled with a decrease in gross profit margins to 23.4% in the third quarter of 2025 from 25.1% in the same period of 2024. Segment revenues decreased due to a 10% decrease in the number of units settled in the third quarter of 2025 when compared to the third quarter of 2024. Gross profit margins were negatively impacted by higher lot costs and pricing pressure due primarily to continued affordability challenges.

Current wording

The Mid Atlantic segment had an approximate $95,500, or 51%, decrease in segment profit in the first quarter of 2026 compared to the first quarter of 2025. The decrease in segment profit was driven by a decrease in segment revenues of approximately $344,200, or 32%, coupled with a decrease in gross profit margin to 22.2% in the first quarter of 2026 from 24.1% in the same period of 2025. Segment revenues decreased due to a 31% decrease in the number of units settled. The decrease in settlements was primarily attributable to a 22% lower backlog unit balance entering 2026 compared to backlog entering 2025, coupled with a lower backlog turnover rate quarter over quarter. Gross profit margins were negatively impacted by higher lot costs and pricing pressure.

Previous wording

Segment New Orders decreased 22% while the average sales price of New Orders increased 3%, in the third quarter of 2025 compared to the third quarter of 2024. New Orders were lower primarily due to a 14% decrease in the average number of active communities, coupled with a 9% lower sales absorption rate. The average sales price of New Orders was favorably impacted by a shift to higher priced communities in certain markets within the segment.

Current wording

Segment New Orders increased 3%, while the average sales price of New Orders decreased 3% in the first quarter of 2026 compared to the first quarter of 2025. New Orders were higher primarily due to a 4% increase in the average number of active communities.

Previous wording

The North East segment had an approximate $4,300, or 8%, decrease in segment profit in the third quarter of 2025 compared to the third quarter of 2024, due primarily to a decrease in segment revenues of approximately $8,700, or 3%. Segment revenues decreased due to a 15% decrease in the number of units settled, offset by a 14% increase in the average settlement price quarter over quarter. The decrease in the number of settlements is attributable to a 16% lower backlog unit balance entering the third quarter of 2025 compared to the backlog unit balance entering the third quarter of 2024. The increase in the average settlement price is attributable primarily to a 9% higher average price of units in backlog entering the third quarter of 2025 compared to backlog entering the third quarter of 2024. The segment's gross profit margin percentage remained relatively flat quarter over quarter.

Current wording

The Mid East segment had an approximate $18,900, or 35%, decrease in segment profit in the first quarter of 2026 compared to the first quarter of 2025. The decrease in segment profit was driven by a decrease in segment revenues of approximately $102,000, or 25%. Segment revenues decreased due to a 29% decrease in the number of units settled, offset partially by a 6% higher average settlement price. The decrease in settlements was primarily attributable to a 20% lower backlog unit balance entering 2026 compared to the backlog entering 2025, coupled with a lower backlog turnover rate quarter over quarter. The increase in the average settlement price was attributable to a 5% higher average price of units in backlog entering 2026 compared to backlog entering 2025.

Previous wording

Segment New Orders decreased 19% while the average sales price of New Orders remained relatively flat, in the first nine months of 2025 compared to the first nine months of 2024. New Orders were lower primarily due to a 20% decrease in the average number of active communities year over year.

Current wording

Segment New Orders increased 8% while the average sales price of New Orders remained flat in the first quarter of 2026 when compared to the first quarter of 2025. The increase in New Orders was primarily attributable to a 9% increase in the average number of active communities quarter over quarter.

Previous wording

(1)This item represents changes to the contract land deposit impairment reserve, which are not allocated to the reportable segments. See further discussion of lot deposit impairment charges in Note 2 in the accompanying condensed consolidated financial statements.

Current wording

(1)This item represents changes to the contract land deposit impairment allowance, which are not allocated to the reportable segments. See further discussion of lot deposit impairment charges in Note 2 in the accompanying condensed consolidated financial statements.

Previous wording

We conduct our mortgage banking activity through NVR Mortgage Finance, Inc. (“NVRM”), a wholly owned subsidiary. NVRM focuses exclusively on serving the homebuilding segment's customers. NVRM sells almost all of the mortgage loans it closes to investors in the secondary markets on a servicing-released basis, typically within 30 days from the loan closing. The following table summarizes the results of our mortgage banking operations and certain statistical data for the three and nine months ended September 30, 2025 and 2024:

Current wording

We conduct our mortgage banking activity through NVRM Mortgage Finance, Inc. ("NVRM"), a wholly owned subsidiary. NVRM focuses exclusively on serving the homebuilding segment customer base. NVRM sells the loans it originates into the secondary markets primarily on a servicing-released basis, typically within 30 days from the loan closing. The following table summarizes the results of our mortgage banking operations and certain statistical data for the three months ended March 31, 2026 and 2025:

Previous wording

Loan closing volume for the three and nine months ended September 30, 2025 decreased by approximately $116,700, or 7%, and $36,600, or 1%, respectively, from the same periods in 2024. The decrease in loan closing volume during the three and nine months ended September 30, 2025 was primarily attributable to a lower number of loans closed in the respective periods resulting from fewer homebuilder settlements.

Current wording

Loan closing volume for the three months ended March 31, 2026 decreased by approximately $380,000, or 27%, from the same period in 2025. The decrease in loan closing volume during the three months ended March 31, 2026 was primarily due to a 26% decrease in the number of loans closed in the first quarter of 2026 compared to the first quarter of 2025, consistent with the 22% decrease in settlements in our homebuilding operations.

Previous wording

Segment profit for the nine months ended September 30, 2025 decreased by approximately $14,300, or 13%, from the same period in 2024. This decrease was primarily attributable to a decrease of approximately $14,900, or 9%, in mortgage banking fees due to a decrease in gains on sales of loans.

Current wording

Segment profit for the three months ended March 31, 2026 decreased by approximately $5,800, or 17%, from the same period in 2025. The decrease was primarily attributable to a decrease in mortgage banking fees, partially offset by a decrease in general and administrative expenses. Mortgage banking fees decreased by approximately $6,400, or 12%, primarily due to lower gains on sales of loans. General and administrative expenses decreased by $1,100, or 5%, which was the result of decreased personnel costs.

Previous wording

Our effective tax rate for the three and nine month periods ended September 30, 2025 was 22.8% and 24.5%, respectively, compared to 20.3% and 20.6% for the three and nine months ended September 30, 2024, respectively. The increase in the effective tax rate in the three and nine month periods ended September 30, 2025 compared to the same periods in 2024 was primarily attributable to a lower income tax benefit recognized for excess tax benefits from stock option exercises, which totaled approximately $13,400 and $19,700 for the three and nine months ended September 30, 2025, respectively, and approximately $23,100 and $73,700 for the three and nine months ended September 30, 2024, respectively.

Current wording

Our effective tax rate during the three months ended March 31, 2026 was 21.2% compared to 25.5% for the three months ended March 31, 2025. The decrease in the effective tax rate in the first quarter of 2026 is primarily attributable to a higher income tax benefit recognized for excess tax benefits from stock option exercises, which totaled approximately $12,600 and $2,700 for the three months ended March 31, 2026 and March 31, 2025, respectively.

Previous wording

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 September 30, 2025, we had approximately $2,000,000 in cash and cash equivalents, approximately $289,800 in unused committed capacity under our revolving credit facility and $150,000 in unused committed capacity under our revolving mortgage repurchase facility.

Current wording

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 March 31, 2026, we had approximately $1,700,000 in cash and cash equivalents, approximately $288,800 in unused committed capacity under our revolving credit facility and $150,000 in unused committed capacity under our revolving mortgage repurchase facility.

Previous wording

(i) Payments due to service our debt and interest on that debt. Our Senior Notes have an outstanding aggregate principal balance of $900,000 and mature in May 2030. Future interest payments on our outstanding Senior Notes total $131,550, with $27,000 due within the next twelve months.

Current wording

(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 outstanding Senior Notes total approximately $118,050, with $27,000 due within the next twelve months.

Previous wording

(ii) Payment obligations totaling approximately $640,900 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.

Current wording

(ii) Payment obligations totaling approximately $698,600 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.

Previous wording

(iii) Obligations under operating and finance leases related primarily to office space and our production facilities. See Note 13 of this Quarterly Report on Form 10-Q for additional discussion of our leases.

Current wording

(iii) Obligations under operating and finance leases related primarily to office space and our production facilities (see Note 12 of this Form 10-Q for additional discussion of our leases).

Previous wording

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 Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, of this Quarterly Report on Form 10-Q for further discussion of repurchase activity during the third quarter of 2025. For the nine months ended September 30, 2025, we repurchased 178,178 shares of our common stock at an aggregate purchase price of $1,331,212. As of September 30, 2025, we had approximately $1,036,980 available under Board approved repurchase authorizations.

Current wording

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 Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, of this Form 10-Q for further discussion of repurchase activity during the first quarter of 2026. For the quarter ended March 31, 2026, we repurchased 90,180 shares of our common stock at an aggregate purchase price of $631,956 As of March 31, 2026, we had approximately $667,600 available under a Board approved repurchase authorization.

Previous wording

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 $10,200 outstanding as of September 30, 2025. There were no borrowings outstanding under the Credit Agreement as of September 30, 2025.

Current wording

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 $11,200 outstanding as of March 31, 2026. There were no borrowings outstanding under the Credit Agreement as of March 31, 2026.

Previous wording

Net cash provided by operating activities was $681,592 for the nine months ended September 30, 2025, due primarily to cash provided by earnings. Cash was primarily used to fund the increase of $181,771 in contract land deposits, an increase in inventory of $72,718, and a decrease in accounts payables and accrued expenses of $81,116.

Current wording

For the three months ended March 31, 2026, cash, restricted cash, and cash equivalents decreased by $227,194. Net cash provided by operating activities was $339,686, due primarily to cash provided by earnings for the three months ended March 31, 2026 and a $276,676 reduction in mortgage loans held for sale. Cash was primarily used to fund the increase in inventory of $214,950, attributable to an increase in units under construction as of March 31, 2026 compared to December 31, 2025.

Previous wording

Net cash used in investing activities for the nine months ended September 30, 2025 was $57,374. Cash was used primarily for investments in unconsolidated joint ventures totaling $37,281 and purchases of property, plant and equipment of $20,808.

Current wording

Net cash provided by investing activities for the three months ended March 31, 2026 was $12,465, due primarily to cash provided by the sale of our interest in an unconsolidated joint venture of $21,559. Cash was used primarily for investments in unconsolidated joint ventures totaling $4,388 and purchases of property, plant and equipment of $4,871.

Previous wording

Net cash used in financing activities was $1,265,281 for the nine months ended September 30, 2025. Cash was used to repurchase 178,178 shares of our common stock at an aggregate purchase price of $1,331,212 under our ongoing common stock repurchase program, discussed above. Cash was provided from stock option exercise proceeds totaling $69,343.

Current wording

Net cash used in financing activities was $579,345 for the three months ended March 31, 2026. Cash was used to repurchase 90,180 shares of our common stock at an aggregate purchase price of $631,956 under our ongoing common stock repurchase program, discussed above. Cash was provided from stock option exercise proceeds totaling $54,087.

Previous wording

There have been no material changes to our critical accounting estimates as previously disclosed in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

There have been no material changes to our critical accounting policies and estimates as previously disclosed in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025.