Revenue
Earnings
The consensus estimate for earnings per share in Q3 2025 is $1.51, which implies a decline of nearly 26% from the prior-year quarter. In Q2 2025, EPS fell 30% YoY to $1.50.
Points to note
KB Home’s performance in Q2 was impacted by challenging market conditions. Consumers were reluctant to buy homes and affordability was hindered by high mortgage rates and macroeconomic uncertainties. These headwinds are not likely to go away soon and they may have affected Q3 results.
In Q2, homes delivered decreased 11% while net orders were down 13%. Average selling price was up slightly at approx. $489,000. Adjusted gross margin dropped 150 basis points to 19.7%, due to price reductions and other concessions.
For the third quarter, KBH has guided for housing revenues of $1.5-1.7 billion. Average selling price is expected to range between $470,000-480,000. Adjusted gross margin is expected to be 18.1-18.7%, which is lower than last year, as the company anticipates pricing pressure to persist.
KB Home is expected to benefit from its built-to-order model, which gives customers the flexibility to personalize their homes to fit their budget. This model gives the company a competitive advantage as well. The homebuilder anticipates that growth in the built-to-order mix will help drive higher gross margins over time.