Dream Finders Homes Announces First Quarter 2026 Results

Published: 2026-04-30 07:03:06 ET DFH

Record Quarter Net Sales of 2,408, Up 19%

Published on 04/30/2026 at 07:03 am EDT

Dream Finders Homes, Inc. (the “Company”, “Dream Finders Homes”, “Dream Finders” or “DFH”) (NYSE: DFH) announced its financial results for the first quarter ended March 31, 2026.

First Quarter 2026 Highlights (As Compared to First Quarter 2025)

Management Commentary

Patrick Zalupski, Dream Finders Homes Chairman and CEO, said, “We continue to operate in a challenging environment as elevated mortgage rates and broader macroeconomic uncertainty have impacted affordability and consumer confidence across our markets. Despite these headwinds, I believe the team did an admirable job showing our ability to adapt pricing and incentive strategies to align with current market conditions, which enabled us to generate record net sales in the first quarter of 2,408, a 19% increase from the prior year quarter.

While closings and profitability were impacted in the short term, our strong sales performance reflects continued demand for our product and the effectiveness of our approach in maintaining absorption in a competitive environment. As we have consistently stated, our focus remains on managing the business with discipline while positioning for long-term growth.

We remain committed to driving operational efficiencies and delivering high-quality, affordable homes that meet the needs of our customers. Although near-term conditions remain dynamic, we believe our disciplined approach and scalable platform position us well to navigate the current environment and capitalize on opportunities over the long term. We reiterate our 2026 full year guidance of approximately 9,250 expected home closings.”

Homebuilding

First Quarter 2026 Results

Homebuilding revenues in the first quarter of 2026 were $837 million, a decrease of 14% when compared to the first quarter of 2025. The decrease in revenues was driven by lower average selling prices (“ASP”) and home closings. Declines in ASP across all segments were attributable to the continued use of sales incentives during the first quarter of 2026, as well as changes in our geographic and product mix.

Homebuilding gross margin percentage in the first quarter of 2026 was 14.5%, compared to 19.2% in the first quarter of 2025. The decrease in homebuilding gross margin percentage was primarily the result of higher sales incentives, as well as land and financing costs.

Adjusted homebuilding gross margin in the first quarter of 2026 was 24.3%, compared to 27.8% in the first 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 first quarter of 2026 decreased 5% to $111 million, compared to $117 million in the first quarter of 2025. The decrease in SG&A was primarily due to lower compensation costs from payroll and incentive reductions commensurate with operational volume and financial results. SG&A as a percentage of homebuilding revenues in the first quarter of 2026 increased 130 bps to 13.3%, compared to 12.0% in the first quarter of 2025 due to reduced absorption.

Other expense, net of customary other income items in the first quarter of 2026 includes investing activities unrelated to our core homebuilding operations, which resulted in a net loss of approximately $1 million, primarily driven by an unrealized loss due to changes in fair value.

Consolidated net income attributable to DFH in the first quarter of 2026 was $13 million, or $0.11 per basic share, compared to $55 million, or $0.55 per basic share, in the first quarter of 2025. Current quarter net income was negatively affected by approximately $1 million due to a higher effective tax rate, primarily as a result of decreased tax benefits from stock-based compensation.

Net sales in the first quarter of 2026 were 2,408, an increase of 19% compared to 2,032 net sales for the first quarter of 2025. During the three months ended March 31, 2026, net sales included 145 sales related to a built-for-rent contract in our Mid-Atlantic segment. The cancellation rate in the first quarter of 2026 was 7.5%, an improvement of 420 bps compared with the first quarter of 2025 cancellation rate of 11.7%. The record level of sales and low cancellation rate this quarter highlight the effectiveness of our sales incentive strategies in driving traffic, as well as our continued focus on offering high-quality, affordable homes in desirable communities across our markets.

First Quarter 2026 Backlog

As of March 31, 2026, DFH had a backlog of 2,377 homes, valued at $1.1 billion, compared to the backlog of 1,839 homes, valued at $0.8 billion as of December 31, 2025. As of March 31, 2026, the ASP in backlog was $465,237 compared to $446,597 as of December 31, 2025. As of March 31, 2026, approximately 106 homes are expected to be delivered in 2027 and beyond.

The following table shows the backlog units and ASP as of March 31, 2026 by homebuilding segment:

As of

March 31, 2026

(unaudited)

Backlog:

Units

Average Sales Price

Southeast

1,037

$ 448,491

Mid-Atlantic

778

370,459

Midwest

562

627,344

Total

2,377

$ 465,237

Financial Services

Financial services revenues increased by $31 million, or 159%, for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025, mostly due to the April 2025 acquisition of Alliant Title. Income before taxes increased by $2 million, or 33%, during the first quarter of 2026 as compared to the same period in 2025, primarily due to execution efficiency and hedging strategies implemented by Jet HomeLoans after the first quarter of 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.

Dream Finders Homes, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share amounts)

March 31, 2026 (unaudited)

December 31, 2025

Assets

Cash and cash equivalents

435,375

234,766

Restricted cash

43,638

49,624

Accounts receivable

32,823

39,120

Inventories

2,140,634

2,025,662

Lot deposits

534,159

545,253

Mortgage loans held for sale

147,184

205,089

Other assets

241,462

223,999

Investments in unconsolidated entities

20,256

26,610

Goodwill

377,361

Total assets

3,972,892

3,727,484

Liabilities

Accounts payable

123,162

126,130

Accrued liabilities

279,781

321,457

Customer deposits

86,123

69,593

Revolving credit facility and other borrowings

1,158,261

822,296

Senior unsecured notes, net

591,693

591,060

Mortgage warehouse facilities

139,031

192,837

Total liabilities

2,378,051

2,123,373

Mezzanine Equity

Redeemable preferred stock

148,500

Redeemable noncontrolling interests

29,539

Equity

Class A common stock, $0.01 per share; 289,000,000 authorized, 37,390,538 and 36,667,477 issued as of March 31, 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 March 31, 2026 and December 31, 2025

577

Accumulated other comprehensive (loss) income

(452

)

613

Additional paid-in capital

298,679

298,594

Retained earnings

1,183,831

1,173,950

Treasury stock, at cost, 3,187,654 and 2,124,094 shares of Class A common stock as of March 31, 2026 and December 31, 2025, respectively

(68,008

)

(49,526

)

Total Dream Finders Homes, Inc. stockholders’ equity

1,415,001

1,424,575

Noncontrolling interests

1,801

1,497

Total equity

1,416,802

1,426,072

Total liabilities, mezzanine equity and equity

3,972,892

3,727,484

Dream Finders Homes, Inc.

Condensed Consolidated Statements of Operations

(In thousands, except share and per share amounts)

Three Months Ended

March 31,

(unaudited)

2026

2025

Revenues:

Homebuilding

836,659

970,108

Financial services

51,180

19,763

Total revenues

887,839

989,871

Homebuilding cost of sales

715,643

783,536

Financial services expense

42,711

12,866

Selling, general and administrative expense

110,903

116,694

Income from unconsolidated entities

(335

)

(180

)

Contingent consideration revaluation

—

1,100

Other expense, net

111

4,690

Income before taxes

18,806

71,165

Income tax expense

(5,246

)

(16,155

)

Net income

13,560

55,010

Net income attributable to noncontrolling interests

(304

)

(107

)

Net income attributable to Dream Finders Homes, Inc.

13,256

54,903

Earnings per share

Basic

0.11

0.55

Diluted

0.11

0.54

Weighted-average number of shares

Basic

92,020,167

93,550,316

Diluted

92,429,194

101,360,214

Dream Finders Homes, Inc.

Other Financial and Operating Data

Three Months Ended March 31, (unaudited)

2026

2025

Other Financial and Operating Data:

Home closings

1,870

1,925

Average sales price of homes closed(1)

447,753

498,284

Net sales

2,408

2,032

Cancellation rate

7.5

11.7

Homebuilding gross margin (in thousands)(2)

121,016

186,572

Homebuilding gross margin %(3)

14.5

19.2

Adjusted homebuilding gross margin (in thousands)(4)

203,322

270,100

Adjusted homebuilding gross margin %(3)(4)

24.3

27.8

Selling, general and administrative expense %(3)

13.3

12.0

Active communities as of period end(5)

332

258

Backlog as of period end - units

2,377

2,802

Backlog as of period end - value (in thousands)

1,105,868

1,386,954

Net homebuilding debt to net capitalization(4)

44.7

40.4

Return on participating equity(6)

12.0

28.5

(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.

Three Months Ended

March 31,

(unaudited)

2026

2025

Home Closings:

Units

Average

Sales Price

Units

Average

Sales Price

Southeast

614

$ 437,746

687

$ 445,901

Mid-Atlantic

626

380,147

521

454,581

Midwest

630

524,682

717

580,221

Total

1,870

$ 447,753

1,925

$ 498,284

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 March 31, (unaudited)

2026

2025

Homebuilding gross margin(1)

121,016

186,572

Interest expense in homebuilding cost of sales(2)

46,786

41,805

Amortization in homebuilding cost of sales(3)

(65

)

1,329

Commission expense

35,585

40,394

Adjusted homebuilding gross margin

203,322

270,100

Homebuilding gross margin %(4)

14.5

19.2

Adjusted homebuilding gross margin %(4)

24.3

27.8

(1) Homebuilding gross margin is homebuilding revenues less homebuilding cost of sales.

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.

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

March 31,

(unaudited)

As of December 31,

(unaudited)

As of

March 31,

(unaudited)

2026

2025

Total debt

1,888,985

1,606,193

1,476,442

Total mezzanine equity

178,039

177,519

Total equity

1,416,802

1,426,072

1,293,849

Total capitalization

3,483,826

3,210,304

2,947,810

Total debt to total capitalization

54.2

50.0

50.1

Total debt

1,888,985

1,606,193

1,476,442

Less: Mortgage warehouse facilities and other secured borrowings

162,980

217,133

181,457

Less: Cash and cash equivalents

435,375

234,766

297,468

Net homebuilding debt

1,290,630

1,154,294

997,517

Total mezzanine equity

178,039

177,519

Total equity

1,416,802

1,426,072

1,293,849

Net capitalization

2,885,471

2,758,405

2,468,885

Net homebuilding debt to net capitalization

44.7

41.8

40.4

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.

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