D.R. Horton to report Q3 earnings with EPS seen down 11% to $2.99

D.R. Horton Inc. (NYSE: DHI) is scheduled to report fiscal third-quarter earnings before the opening bell on Tuesday, July 21, with analysts expecting earnings per share of $2.99 on revenue of $9.18 billion.

The consensus estimate for EPS implies an 11% decline from the $3.36 reported a year earlier, while revenue is expected to slip 0.4% from the prior-year period, according to data compiled by Zacks. The homebuilder has beaten earnings estimates in three of the trailing four quarters, with an average surprise of 4.1%.

"The results validate our strategy of focusing on entry-level buyers and maintaining broad geographic diversification," D.R. Horton management said during the fiscal second-quarter earnings call in April, noting that sales followed normal seasonal trends through March and remained encouraging into April. The company reported an 11% increase in net sales orders in the fiscal second quarter, providing a stronger backlog to support third-quarter deliveries.

Homebuilding, which contributed 92% of fiscal 2025 total revenue, is expected to generate $8.59 billion in home sales revenue, up from $8.56 billion a year ago. The company guided for consolidated revenue of $8.8 billion to $9.3 billion and home closings of 23,500 to 24,000 units, a meaningful increase from the 19,486 closings in the fiscal second quarter. However, average selling prices are expected to fall to $362,000 from $370,000 a year earlier, reflecting elevated incentives and affordability-focused pricing.

Forestar is expected to contribute $408 million in revenue, up from $391 million a year ago, while the Financial Services segment is seen at $229 million, roughly flat from $228 million. Rental Property revenue is projected at $298 million, down from $381 million.

The earnings report comes amid a shifting rate environment that could benefit the homebuilder. June's cooler-than-expected CPI report reduced the odds of a July rate hike to 16.6% from 42%, according to CME Group's FedWatch tool, sending the 10-year Treasury yield sharply lower. Since 30-year fixed mortgage rates track the 10-year yield, lower rates could reduce the need for the buydowns and incentives that have weighed on margins — more than 70% of closings required a buydown in the fiscal second quarter.

D.R. Horton also received a policy tailwind from the June passage of the 21st Century Road to Housing Act, which sent shares up nearly 7% in a single session. More than 60% of the company's homes go to first-time buyers, a group for whom affordability is the most crucial factor.

The guidance raise from the fiscal second quarter signals management expects demand to hold up despite affordability constraints. Investors will watch the July 21 earnings call for updated commentary on incentive levels, order trends, and whether the recent rate relief is translating into stronger demand through July.

This article is for informational purposes only and does not constitute investment advice.