Toll Brothers (TOL) investor relations material

Executive summary

• Q1 2026 net income rose to $210.9 million ($2.19 per diluted share), up 19% year-over-year, with home sales revenue of $1.85 billion on 1,899 homes delivered; revenues benefited from a major Apartment Living portfolio sale.

• Net contracts signed were flat in units but up 3% in value to $2.4 billion, driven by a higher average sales price of $1,033,000.

• Backlog value declined 13% to $6.02 billion (5,051 homes), with units down 20% but average price per home up 8%.

• Maintained a national footprint with over 60 markets and 445+ communities, positioning for further expansion.

• Leadership transition announced: Karl Mistry to become CEO on March 30, with Douglas Yearley moving to executive chairman.

Financial highlights

• Adjusted gross margin for Q1 2026 was 26.5%, 25 basis points above guidance; home sales gross margin was 24.8%.

• SG&A margin was 13.9%, 30 basis points better than guidance, but up from 13.1% year-over-year.

• Joint venture, land sales, and other income reached $72 million, driven by a major apartment portfolio sale.

• Average delivered home price was $977,000, below guidance due to a higher mix of lower-priced spec homes.

• Ended quarter with $1.20 billion in cash and $2.20 billion available under revolving credit facility; total liquidity stood at $3.4 billion.

Outlook and guidance

• Q2 deliveries projected at 2,400–2,500 homes, average price $975,000–$985,000; full-year 2026 guidance: 10,300–10,700 deliveries, average price $970,000–$990,000.

• Adjusted gross margin guidance: 25.5% for Q2, 26.0% for full year; SG&A expected at 10.7% of revenue in Q2, 10.25% for the year.

• Community count expected to grow 8%-10% by year-end, targeting 480–490 communities.

• $650 million in share repurchases targeted for the year.

• Management expects near-term housing demand to remain subdued due to affordability challenges, but long-term outlook remains positive, supported by favorable demographics and structural undersupply.