PulteGroup closings, earnings fall, still beat expectations

PulteGroup saw earnings fall again in the second quarter, reflecting a housing market constrained by high mortgage rates and affordability issues.

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The homebuilder posted net income of $472 million, or $2.48 per share, down from $608 million, or $3.03 per share, in the second quarter of last year but still more than analysts expectations of $2.36 per share.

PulteGroup’s mortgage business, Pulte Mortgage, also took a hit, as origination volume fell to 4,629 from 4,984 a year prior, while origination principle declined to $1.98 billion from $2.16 billion. But its mortgage capture rate increased modestly from 84.8% to 85.2%, the report showed.

“Market conditions remain highly competitive as macroeconomic uncertainty, volatile interest rates and strained affordability weigh on housing demand, but there are early signs that conditions may be stabilizing in select geographies around the country,” said Ryan Marshall, president and CEO of PulteGroup, in a press release Wednesday.

The homebuilder’s second quarter home sale revenues dropped 11% year over year to $3.8 billion. Revenues were dragged down by a 8% decrease in closing volumes to 6,997 homes, as well as a 3% decline in average sales price to $544,000, according to the release.

PulteGroup delivered a 25% home sale gross margin, a 60-basis-point increase from the first quarter of this year but still down from 27% last year. Its selling, general and administrative expense was $383 million, or 10.1% of home sale revenues, compared to $390 million, or 9.1%, in 2025.

The company reaffirmed on an earning call Wednesday its full-year guidance, which included 28,500 to 29,000 home closings and a gross margin of 24.5% to 25%.

Net new orders for the quarter rose 6.4% year over year to 7,536 homes, as high community count helped increase orders across all buyer groups. In monetary terms, net new orders jumped 5.1% to $4.1 billion. Community count for the second quarter also averaged 1,074, an 8% spike from last year, the release said.

The homebuilder ended the quarter with a backlog of 10,966 homes, up 2% from last year, while backlog value decreased 1% to $6.8 billion. 

“We continue to capture benefits from our return-focused operating model and business platform that is well diversified across markets and buyer groups,” Marshall said.

PulteGroup’s financial services operations reported pretax income of $37 million, compared with the prior year’s $43 million.

Despite the decline in revenue and profits, PulteGroup’s stock has increased about 1% as of 1:30 p.m. Wednesday. Its earnings mirrored much of what the market saw yesterday with D.R. Horton, which also reported an annual decrease in net income but still beat analysts expectations.