KB Home Shares Fall 3% After Earnings Miss and Margin Compression

Font: Financial Modeling Prep  • Mar 25, 2026

KB Home (NYSE: KBH) reported first-quarter results that came in below Wall Street expectations, with shares declining more than 3% intra-day Wednesday following the release.

The homebuilder reported earnings per share of $0.52, missing the analyst consensus of $0.55. Revenue totaled $1.08 billion, down 23% year over year and slightly below the $1.09 billion estimate.

Housing gross profit margin, excluding inventory-related charges, declined to 15.5% from 20.3% in the prior-year quarter. The compression was primarily attributed to price reductions, increased land costs, and weaker operating leverage.

Homebuilding operating margin also fell sharply to 3.1% from 9.2% a year earlier. The company delivered 2,370 homes during the quarter at an average selling price of $452,100, compared with $500,700 in the prior-year period.

KB Home repurchased $50.0 million of its common stock during the quarter.

Looking ahead, the company guided second-quarter housing revenue to a range of $1.05 billion to $1.15 billion, with a midpoint of $1.10 billion. Deliveries are expected to be between 2,250 and 2,450 homes, with housing gross profit margin projected at 15.0% to 15.6%.

For the full year, KB Home expects to deliver between 10,000 and 11,500 homes, generating housing revenue of $4.80 billion to $5.50 billion.

Net orders increased 3% year over year to 2,846, while the average community count rose 7% to 274. The company ended the quarter with total liquidity of approximately $1.20 billion.