KB Home shares sink after a Q1 earnings miss and chilly start to spring home-buying season
The home builder missed earnings per share and sales estimates as would-be buyers got cold feet.
KB Home shares crumbled over 7% in premarket trading Tuesday after the home builder missed Q1 earnings expectations and dialed back its full-year outlook.
The company reported diluted earnings of $1.49 per share, falling short of Wall Street’s $1.39 forecast, while revenue slipped to $1.39 billion — well below the expected $1.5 billion.
CEO Jeffrey Mezger pointed to economic uncertainty and affordability concerns as key factors cooling buyer confidence. “Demand at the start of this spring’s selling season was more muted than what we have seen historically, despite a healthy level of traffic in our communities,” he said. Spring is typically the hottest time for home sales, making the slowdown all the more concerning.
Feeling the chill, KB Home trimmed its full-year guidance, now expecting housing revenue between $6.6 billion and $7 billion, down from its prior $7 billion to $7.5 billion range. Net home orders also sank 17% year over year to 2,772, leading the company to curb its average selling price expectations and tighten its margin forecast.
Before today’s open, shares of the home builder had fallen about 10% over the past year.
