Toll Brothers (TOL) Q2 2026 earnings summary

Executive summary

• Q2 2026 net income was $260.6 million ($2.72 per diluted share), down from $352.4 million ($3.50 per share) year-over-year, with revenues of $2.51 billion on 2,491 homes delivered.

• Net signed contract value rose to $2.81 billion (2,834 homes), up 8% in value and 7% in units year-over-year, driven by a 9% increase in community count.

• Backlog at April 30, 2026 was $6.32 billion (5,394 homes), down 8% in value and 11% in units year-over-year, but average backlog price per home increased 4%.

• Maintained a national footprint with 459 communities and 76,804 lots controlled as of April 30, 2026.

• Focused on affluent buyers, capital efficiency, shareholder returns, and operational improvements, including the acquisition of Buffington Homes in Northwest Arkansas.

Financial highlights

• Q2 2026 home sales revenue was $2.51 billion, down 7% year-over-year; FY 2025 home sales revenue was $10.84 billion, net income $1.35 billion, EBITDA $1.99 billion.

• Adjusted gross margin for Q2 2026 was 26.2%, down from 27.5% year-over-year; SG&A was 10.3% of revenue, up from 9.5%.

• Diluted EPS for Q2 2026 was $2.72, compared to $3.50 in Q2 2025; FY 2025 diluted EPS was $13.49.

• Book value per share at quarter-end was $90.51, up from $87.25 at FYE 2025.

• Cash and cash equivalents were $1.11 billion, with $2.24 billion available under the revolving credit facility.

Outlook and guidance

• Raised full-year FY 2026 guidance: 10,400–10,700 deliveries, average price $985,000–$1,000,000, adjusted gross margin 26.10%, SG&A 10.10%, 480–490 communities.

• Q3 FY 2026 guidance: 2,600–2,700 deliveries, average price $965,000–$985,000, adjusted gross margin 25.25%, SG&A 10.0%.

• Management expects near-term softness in new home demand due to affordability pressures and weak consumer confidence, but long-term outlook remains positive, supported by favorable demographics and structural undersupply.

• Industry fundamentals remain strong due to constrained supply, demographic tailwinds, and aging housing stock.

• Largest public homebuilders expected to continue gaining market share, supported by capital access and efficiency.