Dream Finders Homes (NYSE: DFH) posts record Q2 sales but lower profit
Rhea-AI Filing Summary
Dream Finders Homes reported second quarter 2026 results with record net sales and closings but lower revenue and earnings year over year. Net sales rose 15% to 2,232 homes and home closings increased 3% to a record 2,290, while the cancellation rate improved to 11.1% from 14.0%.
Homebuilding revenues were $1.0 billion versus $1.1 billion a year earlier as the average sales price declined to $438,171. Homebuilding gross margin compressed to 14.2% (adjusted 24.2%). Pre-tax income was $37 million versus $74 million, and net income attributable to DFH was $28 million, or $0.27 per basic share, compared with $57 million, or $0.57.
As of June 30, 2026, backlog was 2,319 homes valued at $1.2 billion, active communities increased to 353, and total liquidity was $605 million. Net homebuilding debt to net capitalization was 46.5%. The company repurchased 1,012,621 Class A shares for $15 million and reiterated full-year guidance of approximately 9,250 home closings.
Positive
- Record demand with net sales up 15% to 2,232 homes and record quarterly home closings of 2,290, alongside an improved cancellation rate of 11.1% versus 14.0%.
- Strong liquidity and capital returns with $605 million of total liquidity as of June 30, 2026 and repurchases of 1,012,621 Class A shares for $15 million in the quarter.
Negative
- Profitability deteriorated: pre-tax income declined to $37 million from $74 million and net income attributable to DFH fell to $28 million from $57 million year over year.
- Margin compression as homebuilding gross margin fell to 14.2% from 16.5% and adjusted homebuilding gross margin to 24.2% from 25.9%.
- Return on participating equity decreased sharply to 9.6% from 25.0%, reflecting weaker returns despite record net sales and closings.
Filing Explained
At June 30, 2026, DFH reported cash of $203,494 thousand against debt of $1,817,113 thousand, with net homebuilding debt at 46.5 percent of net capitalization.
This Form 8-K reports the company’s second-quarter results for the three months ended
Its
At
Net homebuilding debt to net capitalization was
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Net sales (orders): 2,232 homes
Homebuilding revenues: $1,007,144,000
Net income attributable to DFH: $27,721,000
+5 more
8 metrics
Net sales (orders)
2,232 homes
Second quarter 2026 net sales, up from 1,938 homes in second quarter 2025
Homebuilding revenues
$1,007,144,000
Homebuilding revenues for Q2 2026 versus $1,099,580,000 in Q2 2025
Net income attributable to DFH
$27,721,000
Net income attributable to Dream Finders Homes, Inc. in Q2 2026 versus $56,580,000 in Q2 2025
Basic earnings per share
$0.27
Basic EPS for the three months ended June 30, 2026 versus $0.57 in 2025
Homebuilding gross margin %
14.2%
Homebuilding gross margin percentage in Q2 2026 versus 16.5% a year earlier
Total liquidity
$605,000,000
Total liquidity as of June 30, 2026, including cash and revolver availability
Backlog value
$1,154,203,000
Backlog value across 2,319 homes as of June 30, 2026
Net homebuilding debt to net capitalization
46.5%
Net homebuilding debt to net capitalization as of June 30, 2026
Key Terms
adjusted homebuilding gross margin, net homebuilding debt to net capitalization, cancellation rate, contingent consideration revaluation
4 terms
adjusted homebuilding gross margin financial
"Adjusted homebuilding gross margin is a non-GAAP financial measure"
A measure of the profit a homebuilder earns on its core house-construction operations after removing or normalizing items that can distort the picture, such as one-time charges, unusual write-downs or accounting treatments for land and lots. Think of it as the builder’s “clean” margin on each house, like a baker calculating cake profit after excluding a one-off oven repair. Investors use it to see true operating performance, compare builders, and judge pricing power and cost control over time.
net homebuilding debt to net capitalization financial
"Net homebuilding debt to net capitalization is a non-GAAP financial measure"
cancellation rate financial
"The cancellation rate in the second quarter of 2026 was 11.1%"
The cancellation rate is the share of orders, bookings, subscriptions or appointments that are cancelled before they are completed, expressed as a percentage of total commitments. Investors care because a rising cancellation rate is like many diners calling off reservations: it can signal weaker demand, lower predictable revenue, higher costs to replace lost business, and risks to future growth and cash flow forecasts.
contingent consideration revaluation financial
"Contingent consideration revaluation | — | | | (12,706)"
Earnings Snapshot
Total revenues: $1,063,424,000 · Guidance included
Three months ended June 30, 2026
Total revenues
$1,063,424,000
down from $1,150,505,000 in Q2 2025
Net income attributable to DFH
$27,721,000
down from $56,580,000 in Q2 2025
Basic EPS
$0.27
down from $0.57 in Q2 2025
Home closings
2,290
up from 2,232 in Q2 2025
Net sales (orders)
2,232 homes
up from 1,938 homes in Q2 2025
Guidance
Approximately 9,250 home closings for full year 2026
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How did Dream Finders Homes (DFH) perform in Q2 2026 versus Q2 2025?
Dream Finders Homes’ Q2 2026 results showed record net sales and closings but lower profitability versus 2025. Net sales rose to 2,232 and closings to 2,290, while net income attributable to DFH declined to $27.7 million from $56.6 million.
What were Dream Finders Homes (DFH) revenues and earnings in Q2 2026?
In Q2 2026, DFH generated $1.0 billion of homebuilding revenues and pre-tax income of $37 million. Net income attributable to DFH was $28 million, or $0.27 per basic share, compared with $57 million and $0.57 a year earlier.
How did margins and returns change for Dream Finders Homes (DFH) in Q2 2026?
Homebuilding gross margin declined to 14.2% from 16.5%, and adjusted homebuilding gross margin to 24.2% from 25.9%. Return on participating equity dropped to 9.6% from 25.0%, indicating materially lower profitability on shareholders’ capital.
What is Dream Finders Homes’ (DFH) backlog and community count as of June 30, 2026?
As of June 30, 2026, DFH reported a backlog of 2,319 homes valued at $1.2 billion with an average sales price of $497,716. Active communities increased year over year by 30% to 353, supporting future closing potential.
What leverage and liquidity levels did Dream Finders Homes (DFH) report?
DFH reported total liquidity of $605 million, including cash and revolver availability, as of June 30, 2026. Net homebuilding debt to net capitalization was 46.5%, while total debt to total capitalization stood at 53.0%.
Did Dream Finders Homes (DFH) change its 2026 outlook for home closings?
DFH maintained its full-year 2026 guidance of approximately 9,250 home closings. Through the first six months of 2026, the company had completed 4,160 home closings across its Southeast, Mid-Atlantic and Midwest segments.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): July 30, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
Registrant’s telephone number, including area code: (904 ) 644-7670
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On July 30, 2026 , Dream Finders Homes, Inc. (the “Company”) issued a press release announcing its financial results for the three months ended June 30, 2026. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference into this Item 2.02.
The information furnished under this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Number | Description | |||||||
99.1 | Earnings Press Release dated | |||||||
| 104 | Cover Page Interactive Data File (embedded within the inline XBRL document) | |||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DREAM FINDERS HOMES, INC. | ||||||||
Date: | By: | /s/ Robert E. Riva | ||||||
| Robert E. Riva | ||||||||
| Vice President, General Counsel and Corporate Secretary | ||||||||
| Exhibit 99.1 | ||
Dream Finders Homes Announces Second Quarter 2026 Results
Record Second Quarter Net Sales of 2,232, Up 15%
Record Second Quarter Closings of 2,290
Jacksonville, FL. — July 30, 2026 — Dream Finders Homes, Inc. (the “Company”, “Dream Finders Homes”, “Dream Finders” or “DFH”) (NYSE: DFH) announced its financial results for the second quarter ended June 30, 2026.
Second Quarter 2026 Highlights (As Compared to Second Quarter 2025)
•Net sales increased 15% to 2,232 from 1,938
•Homebuilding revenues of $1.0 billion compared to $1.1 billion
•Home closings increased 3% to 2,290 from 2,232
•Homebuilding gross margin of 14.2% compared to 16.5%
•Adjusted homebuilding gross margin (non-GAAP) of 24.2% compared to 25.9%
•Pre-tax income of $37 million compared to $74 million
•Net income attributable to DFH of $28 million, or $0.27 per basic share, compared to $57 million, or $0.57 per basic share
•Financial services pre-tax income remained consistent at $12 million
•Controlled lot pipeline of 54,091 as of June 30, 2026 compared to 63,121 as of December 31, 2025
•Total liquidity of $605 million as of June 30, 2026, comprised of cash and cash equivalents and availability under the revolving credit facility
•Return on participating equity of 9.6% compared to 25.0%
•Repurchased 1,012,621 Class A common shares for $15 million during the three months ended June 30, 2026
Management Commentary
Patrick Zalupski, Dream Finders Homes Founder, Co-Chairman and CEO, said, “The home building market continues to be challenging, but our teams have worked hard to identify opportunities to improve our cost structure with the goal of delivering more affordable homes to our customers. We believe costs will need to continue to trend down, perhaps significantly, to have a meaningful impact on market-wide housing results. Positively, our team delivered second-quarter and year-to-date Company records for both net sales and home closings. The higher closing volume helped partially offset lower average sales prices, which constrained margins, consistent with challenging macroeconomic conditions. Additionally, in line with our growth initiatives, our year-over-year active community count increase of 30% — reaching 353 communities — was the strongest in the industry. In the coming quarters, we will focus on optimizing these communities by executing our planned absorption targets and margin underwriting to drive improved profitability and return on participating equity.
While the environment has been difficult, DFH certainly has further opportunities to improve operationally. We are laser-focused on reducing our SG&A expense, and believe we can streamline and right-size our operations to better manage our overhead costs in the current environment. This process is well underway, and we hope to be completed by year-end.
We are also continuing to find ways to add experience and talent to our executive team and Board of Directors. I’m incredibly excited about the upgrades to the Company that we announced in the second quarter. With the appointment of Clint Szubinski as Chief Operating Officer, we have added a much-needed experienced and disciplined operator. Clint was most recently COO for a larger national public homebuilder and is fully aligned with the long-term goals for DFH. He is excited about our disciplined asset-light home building model, and, just as importantly, our long-term approach to building a durable business that should produce above-market shareholder returns over time. While Clint appreciates our patient approach, he has already rolled up his sleeves and is working on numerous near-term implementations to improve operational performance. I look forward to reporting back on Clint and the teams’ progress in the coming quarters.
Our Board of Directors received a significant upgrade as well with the appointments of Rick Beckwitt, who will serve alongside me as Co-Chairman, and Steve Fischer, an independent director. Rick’s extensive public homebuilding experience is second to none in the industry, having served as Co-CEO of one of the largest homebuilders, by revenue, in the world. It would be hard to over emphasize Rick’s track record of success; we are incredibly fortunate to have him join our Board. Steve Fischer comes to our Board with significant financial and leadership expertise as a former CFO and CEO in the public banking industry. These two additions bring valuable guidance and perspective as we further scale the business.
As we continue to evaluate opportunities for growth, we remain focused on disciplined capital allocation, inventory turns, cash generation and maintaining the flexibility of our asset-light model. We reiterate our 2026 full-year guidance of approximately 9,250 home closings.”
2
Homebuilding
Second Quarter 2026 Results
Homebuilding revenues in the second quarter of 2026 were $1.0 billion, a decrease of 8% when compared to the second quarter of 2025. The decrease in revenues was driven by lower average selling prices (“ASP”), partially offset by higher home closings. Declines in ASP across all segments were due to changes in our geographic and product mix, partially offset by reduced sales incentives during the second quarter of 2026.
Homebuilding gross margin percentage in the second quarter of 2026 was 14.2%, compared to 16.5% in the second quarter of 2025. The decrease in homebuilding gross margin percentage was primarily the result of higher land and financing costs, partially offset by direct cost reductions and cycle-time improvements.
Adjusted homebuilding gross margin in the second quarter of 2026 was 24.2%, compared to 25.9% in the second quarter of 2025. Adjusted homebuilding gross margin is a non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures” below.
Selling, general and administrative expense (“SG&A”) in the second quarter of 2026 decreased 5% to $128 million, compared to $135 million in the second quarter of 2025. The decrease in SG&A was mostly due to lower compensation costs from payroll and incentive reductions in line with financial results. SG&A as a percentage of homebuilding revenues in the second quarter of 2026 increased 50 bps to 12.8%, compared to 12.3% in the second quarter of 2025 due to reduced absorption per active community, as well as increased investments in technology and growth initiatives.
Contingent consideration income of $13 million during the second quarter of 2025 related to an acquisition earnout arrangement that concluded in 2025 and, therefore, did not impact earnings for the second quarter of 2026. Other income in the second quarter of 2026 included gains on equity securities of $9 million, primarily attributable to unrealized gains from stock price fluctuation.
Net sales in the second quarter of 2026 were 2,232, an increase of 15% compared to 1,938 for the second quarter of 2025. The cancellation rate in the second quarter of 2026 was 11.1%, an improvement of 290 bps compared to the second quarter of 2025 cancellation rate of 14.0%. The record number of sales and low cancellation rate this quarter demonstrate our ongoing commitment to delivering high-quality homes at accessible price points, supported by targeted mortgage buydown programs and compelling sales incentives.
3
Second Quarter 2026 Backlog
As of June 30, 2026, DFH had a backlog of 2,319 homes, valued at $1.2 billion, compared to the backlog of 2,377 homes, valued at $1.1 billion as of March 31, 2026. As of June 30, 2026, the ASP in backlog was $497,716 compared to $465,237 as of March 31, 2026. As of June 30, 2026, approximately 213 homes are expected to be delivered in 2027 and beyond.
The following table shows the backlog units and ASP as of June 30, 2026 by homebuilding segment:
| As of June 30, 2026 (unaudited) | |||||||||||
| Backlog: | Units | Average Sales Price | |||||||||
| Southeast | 1,016 | $ | 481,400 | ||||||||
| Mid-Atlantic | 694 | 431,554 | |||||||||
| Midwest | 609 | 600,333 | |||||||||
| Total | 2,319 | $ | 497,716 | ||||||||
Financial Services
Financial services revenues increased by $5 million, or 11%, for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025, largely due to loan execution efficiency and hedging strategies of Jet HomeLoans. Income before taxes remained consistent when compared to the three months ended June 30, 2025.
Full Year 2026 Outlook
Dream Finders Homes maintains its guidance of approximately 9,250 home closings for the full year 2026.
About Dream Finders Homes
Dream Finders Homes (NYSE: DFH), headquartered in Jacksonville, Florida, was recognized as the 2025 National Builder of the Year by Builder magazine. Dream Finders Homes builds single-family homes throughout the Southeast, Mid-Atlantic and Midwest, including Florida, Texas, Tennessee, North Carolina, South Carolina, Georgia, Colorado, Arizona, and the Washington, D.C. metropolitan area, which comprises Washington D.C., Northern Virginia and Maryland. As the Official Home Builder of the PGA TOUR, the Jacksonville Jaguars and the Tampa Bay Rays, Dream Finders Homes is deeply committed to excellence beyond homebuilding and into the communities it serves. Through its wholly owned subsidiaries, DFH also provides mortgage financing as well as title agency and underwriting services to homebuyers. Dream Finders Homes achieves its growth and returns by maintaining an asset-light homebuilding model. For more information, please visit www.dreamfindershomes.com.
Forward-Looking Statements
This press release includes forward-looking statements regarding future events which include, but are not limited to, projected 2026 home closings and market conditions, possible or assumed future results of operations, and statements regarding the Company’s strategies and expectations as they relate to market opportunities and growth. All forward-looking statements are based on Dream Finders Homes’ beliefs as well as assumptions made by and information currently available to Dream Finders Homes. These statements reflect Dream Finders Homes’ current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in Dream Finders Homes’ Annual Report on Form 10-K for the year ended December 31, 2025 and other filings with the U.S. Securities and Exchange Commission. Dream Finders Homes undertakes no obligation to update or revise any forward-looking statement, except as may be required by applicable law.
4
Dream Finders Homes, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except per share and share amounts)
| June 30, 2026 (unaudited) | December 31, 2025 | ||||||||||
| Assets | |||||||||||
| Cash and cash equivalents | $ | 203,494 | $ | 234,766 | |||||||
| Restricted cash | 50,272 | 49,624 | |||||||||
| Accounts receivable | 29,533 | 39,120 | |||||||||
| Inventories | 2,327,779 | 2,025,662 | |||||||||
| Lot deposits | 501,755 | 545,253 | |||||||||
| Mortgage loans held for sale | 198,131 | 205,089 | |||||||||
| Other assets | 249,562 | 223,999 | |||||||||
| Investments in unconsolidated entities | 21,783 | 26,610 | |||||||||
| Goodwill | 377,361 | 377,361 | |||||||||
| Total assets | $ | 3,959,670 | $ | 3,727,484 | |||||||
| Liabilities | |||||||||||
| Accounts payable | $ | 156,114 | $ | 126,130 | |||||||
| Accrued liabilities | 280,118 | 321,457 | |||||||||
| Customer deposits | 94,459 | 69,593 | |||||||||
| Revolving credit facility and other borrowings | 1,037,986 | 822,296 | |||||||||
| Senior unsecured notes, net | 592,342 | 591,060 | |||||||||
| Mortgage warehouse facilities | 186,785 | 192,837 | |||||||||
| Total liabilities | 2,347,804 | 2,123,373 | |||||||||
| Mezzanine Equity | |||||||||||
| Redeemable preferred stock | 148,500 | 148,500 | |||||||||
| Redeemable noncontrolling interests | 29,539 | 29,539 | |||||||||
| Equity | |||||||||||
Class A common stock, $0.01 per share, 289,000,000 authorized, 37,395,343 and 36,667,477 issued as of June 30, 2026 and December 31, 2025, respectively | 374 | 367 | |||||||||
Class B common stock, $0.01 per share, 61,000,000 authorized, 57,726,153 issued as of June 30, 2026 and December 31, 2025 | 577 | 577 | |||||||||
| Accumulated other comprehensive income | 1,407 | 613 | |||||||||
| Additional paid-in capital | 304,205 | 298,594 | |||||||||
| Retained earnings | 1,208,177 | 1,173,950 | |||||||||
Treasury stock, at cost, 4,200,275 and 2,124,094 shares of Class A common stock as of June 30, 2026 and December 31, 2025, respectively | (82,837) | (49,526) | |||||||||
| Total Dream Finders Homes, Inc. stockholders’ equity | 1,431,903 | 1,424,575 | |||||||||
| Noncontrolling interests | 1,924 | 1,497 | |||||||||
| Total equity | 1,433,827 | 1,426,072 | |||||||||
| Total liabilities, mezzanine equity and equity | $ | 3,959,670 | $ | 3,727,484 | |||||||
5
Dream Finders Homes, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share and share amounts)
| Three Months Ended June 30, (unaudited) | Six Months Ended June 30, (unaudited) | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Homebuilding | $ | 1,007,144 | $ | 1,099,580 | $ | 1,843,803 | $ | 2,069,688 | |||||||||||||||
| Financial services | 56,280 | 50,925 | 107,460 | 70,688 | |||||||||||||||||||
| Total revenues | 1,063,424 | 1,150,505 | 1,951,263 | 2,140,376 | |||||||||||||||||||
| Homebuilding cost of sales | 863,782 | 917,871 | 1,579,425 | 1,701,407 | |||||||||||||||||||
| Financial services expense | 45,239 | 40,058 | 87,950 | 52,924 | |||||||||||||||||||
| Selling, general and administrative expense | 128,440 | 134,699 | 239,343 | 251,393 | |||||||||||||||||||
| Income from unconsolidated entities | (43) | (17) | (378) | (197) | |||||||||||||||||||
| Contingent consideration revaluation | — | (12,706) | — | (11,606) | |||||||||||||||||||
| Other (income) expense, net | (10,840) | (3,464) | (10,729) | 1,226 | |||||||||||||||||||
| Income before taxes | 36,846 | 74,064 | 55,652 | 145,229 | |||||||||||||||||||
Income tax expense | (9,002) | (17,525) | (14,248) | (33,680) | |||||||||||||||||||
| Net income | 27,844 | 56,539 | 41,404 | 111,549 | |||||||||||||||||||
| Net (income) loss attributable to noncontrolling interests | (123) | 41 | (427) | (66) | |||||||||||||||||||
| Net income attributable to Dream Finders Homes, Inc. | $ | 27,721 | $ | 56,580 | $ | 40,977 | $ | 111,483 | |||||||||||||||
| Earnings per share | |||||||||||||||||||||||
| Basic | $ | 0.27 | $ | 0.57 | $ | 0.37 | $ | 1.12 | |||||||||||||||
| Diluted | $ | 0.27 | $ | 0.56 | $ | 0.37 | $ | 1.10 | |||||||||||||||
| Weighted-average number of shares | |||||||||||||||||||||||
| Basic | 91,299,188 | 93,444,326 | 91,657,686 | 93,495,455 | |||||||||||||||||||
| Diluted | 91,341,917 | 101,913,888 | 91,883,564 | 101,635,185 | |||||||||||||||||||
6
Dream Finders Homes, Inc.
Other Financial and Operating Data
| Three Months Ended June 30, (unaudited) | Six Months Ended June 30, (unaudited) | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Other Financial and Operating Data: | |||||||||||||||||||||||
| Home closings | 2,290 | 2,232 | 4,160 | 4,157 | |||||||||||||||||||
Average sales price of homes closed(1) | $ | 438,171 | $ | 481,027 | $ | 442,478 | $ | 489,018 | |||||||||||||||
| Net sales | 2,232 | 1,938 | 4,640 | 3,970 | |||||||||||||||||||
| Cancellation rate | 11.1 | % | 14.0 | % | 9.3 | % | 12.8 | % | |||||||||||||||
Homebuilding gross margin (in thousands)(2) | $ | 143,362 | $ | 181,709 | $ | 264,378 | $ | 368,281 | |||||||||||||||
Homebuilding gross margin %(3) | 14.2 | % | 16.5 | % | 14.3 | % | 17.8 | % | |||||||||||||||
Adjusted homebuilding gross margin (in thousands)(4) | $ | 243,735 | $ | 285,162 | $ | 447,057 | $ | 555,262 | |||||||||||||||
Adjusted homebuilding gross margin %(3)(4) | 24.2 | % | 25.9 | % | 24.2 | % | 26.8 | % | |||||||||||||||
Selling, general and administrative expense %(3) | 12.8 | % | 12.3 | % | 13.0 | % | 12.1 | % | |||||||||||||||
Active communities as of period end(5) | 353 | 271 | |||||||||||||||||||||
| Backlog - units | 2,319 | 2,513 | |||||||||||||||||||||
| Backlog - value (in thousands) | $ | 1,154,203 | $ | 1,200,875 | |||||||||||||||||||
Net homebuilding debt to net capitalization(4) | 46.5 | % | 44.5 | % | |||||||||||||||||||
Return on participating equity(6) | 9.6 | % | 25.0 | % | |||||||||||||||||||
(1)Average sales price of homes closed is calculated based on homebuilding revenues, adjusted for the impact of percentage of completion revenues, and excluding deposit forfeitures and land sales, over homes closed.
(2)Homebuilding gross margin is homebuilding revenues less homebuilding cost of sales.
(3)Calculated as a percentage of homebuilding revenues.
(4)Adjusted homebuilding gross margin and net homebuilding debt to net capitalization are non-GAAP financial measures. For definitions of these non-GAAP financial measures and reconciliations to our most directly comparable financial measures calculated and presented in accordance with GAAP, see “Reconciliation of Non-GAAP Financial Measures” below.
(5)A community becomes active once the model is completed or the community has its fifth net sale. A community becomes inactive when it has fewer than five homesites remaining to sell.
(6)Return on participating equity is calculated as net income attributable to DFH, less redeemable preferred stock dividends, divided by average beginning and ending total Dream Finders Homes, Inc. stockholders’ equity (“participating equity”) for the trailing twelve months.
| Three Months Ended June 30, (unaudited) | Six Months Ended June 30, (unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||||||||||||||
| Home Closings: | Units | Average Sales Price | Units | Average Sales Price | Units | Average Sales Price | Units | Average Sales Price | |||||||||||||||||||||||||||||||||||||||
| Southeast | 889 | $ | 431,960 | 842 | $ | 438,549 | 1,503 | $ | 434,324 | 1,529 | $ | 441,561 | |||||||||||||||||||||||||||||||||||
| Mid-Atlantic | 715 | 372,812 | 600 | 444,571 | 1,341 | 376,236 | 1,121 | 449,629 | |||||||||||||||||||||||||||||||||||||||
| Midwest | 686 | 514,341 | 790 | 553,989 | 1,316 | 519,292 | 1,507 | 566,470 | |||||||||||||||||||||||||||||||||||||||
| Total | 2,290 | $ | 438,171 | 2,232 | $ | 481,027 | 4,160 | $ | 442,478 | 4,157 | $ | 489,018 | |||||||||||||||||||||||||||||||||||
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Reconciliation of Non-GAAP Financial Measures
Management utilizes specific non-GAAP financial measures as supplementary tools to evaluate operating performance. These include adjusted homebuilding gross margin and net homebuilding debt to net capitalization. Other companies may not calculate non-GAAP financial measures in the same manner that we do. Accordingly, these non-GAAP financial measures should be considered only as a supplement to relevant GAAP information, as reconciled for each measure below. In the future, we may incorporate additional adjustments to these non-GAAP financial measures as we find them relevant and beneficial for both management and investors.
Adjusted Homebuilding Gross Margin
The following table presents a reconciliation of adjusted homebuilding gross margin to the GAAP financial measure of homebuilding gross margin for each of the periods indicated (in thousands, except percentages):
| Three Months Ended June 30, (unaudited) | Six Months Ended June 30, (unaudited) | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Homebuilding gross margin(1) | $ | 143,362 | $ | 181,709 | $ | 264,378 | $ | 368,281 | |||||||||||||||
Interest expense in homebuilding cost of sales(2) | 58,269 | 56,197 | 105,055 | 98,002 | |||||||||||||||||||
Amortization in homebuilding cost of sales(3) | (346) | 396 | (411) | 1,725 | |||||||||||||||||||
| Commission expense | 42,450 | 46,860 | 78,035 | 87,254 | |||||||||||||||||||
| Adjusted homebuilding gross margin | $ | 243,735 | $ | 285,162 | $ | 447,057 | $ | 555,262 | |||||||||||||||
Homebuilding gross margin %(4) | 14.2 | % | 16.5 | % | 14.3 | % | 17.8 | % | |||||||||||||||
Adjusted homebuilding gross margin %(4) | 24.2 | % | 25.9 | % | 24.2 | % | 26.8 | % | |||||||||||||||
(1)Homebuilding gross margin is homebuilding revenues less homebuilding cost of sales.
(2)Includes interest charged to homebuilding cost of sales related to our senior unsecured notes, net, revolving credit facility and other homebuilding-related debt (“homebuilding debt”), as well as lot option fees.
(3)Represents amortization of purchase accounting adjustments from our acquisitions.
(4)Calculated as a percentage of homebuilding revenues.
We define adjusted homebuilding gross margin as homebuilding gross margin excluding the effects of capitalized interest, lot option fees, amortization included in homebuilding cost of sales (adjustments resulting from the application of purchase accounting in connection with acquisitions) and commission expense. Our management believes this information is meaningful as it isolates the impact that these excluded items have on homebuilding gross margin. We include internal and external commission expense in homebuilding cost of sales, not selling, general and administrative expense, and therefore commission expense is taken into account in homebuilding gross margin.
As a result, in order to provide a meaningful comparison to the public company homebuilders that include commission expense below the homebuilding gross margin line in selling, general and administrative expense, we have excluded commission expense from adjusted homebuilding gross margin. However, because adjusted homebuilding gross margin information excludes capitalized interest, lot option fees, purchase accounting amortization and commission expense, which have real economic effects and could impact our results of operations, the utility of adjusted homebuilding gross margin information as a measure of our operating performance may be limited.
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Net Homebuilding Debt to Net Capitalization
The following table presents a reconciliation of net homebuilding debt to net capitalization to the GAAP financial measure of total debt to total capitalization for each of the periods indicated (in thousands, except percentages):
| As of June 30, (unaudited) | As of December 31, (unaudited) | As of June 30, (unaudited) | |||||||||||||||
| 2026 | 2025 | 2025 | |||||||||||||||
| Total debt | $ | 1,817,113 | $ | 1,606,193 | $ | 1,580,352 | |||||||||||
| Total mezzanine equity | 178,039 | 178,039 | 178,039 | ||||||||||||||
| Total equity | 1,433,827 | 1,426,072 | 1,335,686 | ||||||||||||||
| Total capitalization | $ | 3,428,979 | $ | 3,210,304 | $ | 3,094,077 | |||||||||||
| Total debt to total capitalization | 53.0 | % | 50.0 | % | 51.1 | % | |||||||||||
| Total debt | $ | 1,817,113 | $ | 1,606,193 | $ | 1,580,352 | |||||||||||
Less: Mortgage warehouse facilities and other secured borrowings | 210,459 | 217,133 | 158,041 | ||||||||||||||
| Less: Cash and cash equivalents | 203,494 | 234,766 | 210,320 | ||||||||||||||
| Net homebuilding debt | 1,403,160 | $ | 1,154,294 | 1,211,991 | |||||||||||||
| Total mezzanine equity | 178,039 | 178,039 | 178,039 | ||||||||||||||
| Total equity | 1,433,827 | 1,426,072 | 1,335,686 | ||||||||||||||
| Net capitalization | $ | 3,015,026 | $ | 2,758,405 | $ | 2,725,716 | |||||||||||
| Net homebuilding debt to net capitalization | 46.5 | % | 41.8 | % | 44.5 | % | |||||||||||
Net homebuilding debt to net capitalization is a non-GAAP financial measure calculated as homebuilding debt, less cash and cash equivalents (“net homebuilding debt”), divided by the sum of net homebuilding debt, total mezzanine equity and total equity (“net capitalization”). Net homebuilding debt excludes borrowings under our mortgage warehouse facilities, as well as any other non-homebuilding borrowings the Company may incur from time to time. Management believes the ratio of net homebuilding debt to net capitalization is meaningful as it is used to assess the performance of our homebuilding segments and is a relevant measure of our overall leverage.
Contacts:
Investor Contact: investors@dreamfindershomes.com
Media Contact: mediainquiries@dreamfindershomes.com
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