Toll Brothers delivered strong first-quarter fiscal 2026 results, surpassing expectations with earnings per diluted share of $2.19 and total revenues of $2.15 billion.3951
Key Financial Highlights
The company delivered 1,899 homes at an average price of $977,000, generating home sales revenues of $1.85 billion. This marks a slight increase from $1.84 billion in the prior-year quarter despite fewer units delivered.39 Net signed contracts reached 2,303 units valued at $2.38 billion, reflecting stable unit volume but a 3% rise in dollar value due to higher average sales prices of $1,033,000.
Adjusted home sales gross margin stood at 26.5%, while SG&A expenses as a percentage of home sales revenues came in at 13.9%. Pre-tax income rose to $273.6 million from $221.4 million year-over-year.39
Executive Insights
Douglas C. Yearley, Jr., Chairman and CEO, highlighted the quarter’s performance: “We are pleased with our first quarter results, as we met or exceeded guidance across nearly all metrics.” He emphasized the benefits of the company’s luxury market focus, broad geographic reach, and balanced build-to-order and spec home mix.39
Yearley also announced a leadership transition, with Karl Mistry assuming the CEO role on March 30, 2026. Yearley will shift to Executive Chairman, expressing confidence in Mistry’s long tenure and leadership.51
Strategic Updates
Toll Brothers controls approximately 75,000 lots, positioning it for 8% to 10% annual community count growth. The company completed a partial sale of its Apartment Living portfolio for about $330 million in net cash and plans to exit multi-family development over the next several years. Share repurchases totaled $50.5 million in the quarter.39
Luxury move-up and move-down buyers accounted for 70% of sales, with affluent first-time buyers contributing 25-30%. Contract cancellation rates remained low at 2.8%.51
Guidance and Outlook
For the second quarter, Toll Brothers guides for 2,400 to 2,500 home deliveries at an average price of $975,000 to $985,000, with adjusted gross margin of 25.5% and SG&A at 10.7% of revenues.
Full-year fiscal 2026 expectations include 10,300 to 10,700 deliveries at $970,000 to $990,000 average price, adjusted gross margin of 26.0%, and SG&A of 10.25%. Community count targets 480 to 490 by year-end.3951
Strong Balance Sheet
Cash equivalents reached $1.20 billion, with total liquidity at $3.4 billion. Net debt-to-capital ratio improved to 14.2%. Stockholders’ equity stands at $8.41 billion.39
