Hovnanian Enterprises reported fiscal third-quarter revenue of $705.7 million, down from $800.6 million a year earlier, as the homebuilder’s profitability weakened and contract volume slipped.
The company posted a net loss available to common stockholders of $4.5 million, or $0.70 a diluted share, compared with net income of $13.9 million, or $1.99 a share, in the prior-year quarter. Income before taxes turned to a $2.8 million loss from income of $23.8 million a year ago.
Adjusted EBITDA fell to $31.9 million from $77.1 million in the year-earlier quarter, while EBITDA dropped to $31.4 million from $61.0 million. For the first nine months of fiscal 2026, adjusted EBITDA declined to $136.1 million from $210.4 million, and EBITDA fell to $124.5 million from $190.7 million.
Gross margin before cost of sales interest expense and land charges narrowed to 14.6% from 17.3% a year earlier in the quarter. On the company’s other margin measure, the figure was 11.8%, slightly above 11.7% in the same quarter last year. For the first nine months, the before-interest gross margin was 14.2%, down from 17.6%, while the after-interest measure was 10.8%, down from 13.5%.
Selling, general and administrative expense fell to $86.9 million from $90.8 million, but rose to 12.3% of revenue from 11.3% because of the lower top line. Interest expense declined to $30.5 million from $34.0 million.
Orders softened. Consolidated domestic contracts fell 4.6% to 1,155 homes from 1,211, while contract value rose slightly to $622.6 million from $619.6 million. Including unconsolidated joint ventures, contracts declined 4.0% to 1,359 homes from 1,416, with contract value up to $760.2 million from $749.0 million.
Backlog grew. Consolidated domestic backlog value increased 5.1% to $881.9 million from $838.8 million, and total domestic backlog including joint ventures rose 4.8% to $1.16 billion from $1.10 billion.
Community counts were little changed: consolidated domestic communities were 123, down from 124, while total domestic communities including joint ventures rose to 147 from 146. Contracts per community slipped to 9.4 from 9.8 on a consolidated basis and to 9.2 from 9.7 including joint ventures.
Cancellation rates were flat at 19% for consolidated contracts and improved to 18% from 19% including joint ventures.
Land spending increased in the quarter to $231.9 million from $192.6 million, while nine-month land spending fell to $644.9 million from $660.0 million. Total liquidity at July 31 was $379.8 million. Controlled domestic lots declined to 34,373 from 40,246 a year earlier, with 87% optioned, the highest percentage in the company’s history. Domestic quick move-in homes fell to 820 from 1,016, and finished quick move-ins dropped to 194 from 323. Following these announcements, the company's shares moved -6.8%, and are now trading at a price of $118.99. For the full picture, make sure to review HOVNANIAN ENTERPRISES INC's 8-K report.
