What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-07-01 compared with 2025-04-04 · 338 added, 191 removed, 290 unchanged (65% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and accompanying notes included under Item 1 of this Quarterly Report on Form 10-Q and our audited consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2024.

Our first quarter results were achieved against the backdrop of a challenging macroeconomic environment for the housing market.

We adhered to our strategy and focus on driving consistent volume and growth by matching sales and production pace and using our margin as our shock absorber.

Mortgage interest rates have remained higher for longer than we expected, which has left the overall housing market weaker for longer than expected.

There remains a housing deficit and actionable demand is limited by affordability and credit, which remain challenged by limited funds for a down payment as well as insufficient homebuyer income to meet qualification requirements for mortgages.

Even where household income indicates an approvable mortgage qualification, elevated personal debt levels have often presented an impediment to mortgage access.

Until recently, consumers have been generally confident that they will remain employed and that their compensation is secure.

However, more recently, even that security has been called into question.

While there continues to be a considerable number of customers looking at homes, the urgency to purchase homes remains tepid.

Against this backdrop, our strategy has remained clear.

Operationally, it is to build and deliver consistent volume to maximize efficiencies, while financially, it is to drive our asset-light, land-light focus to build cash flow.

Now that we have completed our Millrose spin-off, we have intensified our focus on each.

We have two focuses in our operating strategy.

First, we focus on maintaining a consistent volume of production and matching our sales pace to our production pace.

This allows us to maximize efficiencies in construction costs, and cycle time, in S,G&A expenses and in all elements of marketing and sales.

It also delivers a consistent and even-flow volume to our trade partners so they can be more efficient and deliver cost savings to us.

By matching our sales pace and our production pace, we avoid building up inventory of finished homes or developed homesites, which efficiently converts production to cash.

Our second focus is our asset-light configuration.

The Millrose spin-off completed the backbone of that effort.

With Millrose operational, we have a strong complement of land bank partners that undertake land acquisition and land development and provide just-in-time delivery of finished homesites that enables us to act almost entirely as a manufacturer of homes.

As with all of our trade partners, our land partners will benefit from our consistent and predictable volume, which will be reflected in reduced costs to us.

To date, tariffs have had no impact on our costs.

However, we have recently been discussing the potential impact of tariffs with our supply chain, including working on alternative sourcing strategies and preparing our trade partners to absorb potential increases in their costs due to tariffs.

Similarly, to date we have encountered no labor disruptions due to immigration enforcement policies.

In summary, the housing market has softened as affordability and consumer confidence have limited actionable demand.

Incentives have been increasing, and net housing prices seem to be moderating.

At very least, housing will not be contributing to inflationary pressures, and while demand is constrained, supply is equally limited.

We expect to sell in the second quarter of 2025 between 22,500 and 23,500 homes and to deliver between 19,500 and 20,500 homes.

We expect our margin to be approximately 18%, depending on market conditions.

We are focused on driving sales and closings to create strong cash flow, even at reduced profitability, while maintaining properly sized inventory levels, so that as market conditions stabilize or improve, we will benefit from normalized margins across our volume.

While the short-term road ahead may still seem choppy, we are optimistic about the longer-term outlook.

We have continued to drive production to meet the housing shortage that we know persists across the markets.

As and when homebuyer interest normalizes, we believe pent-up demand will be activated and our margins will quickly recover.

As we complete our asset-light transformation, we expect to continue to generate cash flow which we can return to stockholders through dividends and stock buybacks, while continuing to pursue strategic growth.

In the second quarter of 2025, our company navigated through a challenging economic environment.

Despite these challenges, we remained steadfast in our strategy to drive volume and growth, matching production and sales pace while using margin as the shock absorber to enable affordability and avoid the build-up of excess inventory.

Our focus on volume and even-flow production enabled us to re-rationalize our cost structure in order to find a floor and rebuild margin even as the overall housing market continues to soften.

The macroeconomic landscape remains challenging, with higher mortgage interest rates and diminished consumer confidence being affected by a wide range of uncertainties, both domestic and global.

At the same time, supply remains constrained by years of underproduction.

New construction has slowed as builders have pulled back on production due to mixed demand signals, exacerbating the chronic supply shortage.

Additionally, restrictive land permitting, along with higher impact fees, remain as constraints on supply, while labor and material costs, and costs of lumber, in particular, are generally increasing.

Demand, however, is still high, as people want and need homes.

Millennials are reaching the prime buying age and are realizing the benefit, and perhaps importance, of homeownership.

But affordability and waning confidence are sending confusing signals.

Actionable demand continues to cool.

This is a difficult cycle, as low supply fuels high prices which lock out many of our homebuyers.

Our operational strategy is clear:

we are building and delivering consistent volume by meeting the market at affordability and pushing efficiencies through our platform.

We strongly believe this will produce greater efficiencies and drive down costs.

Financially, we are focused on driving an efficient, land-light balance sheet to effectively have land banks and third parties hold and develop our land assets while we build cash flow.

We have intentionally maintained volume rather than protecting our margin.

In the past, we protected margin as market conditions slowed.

However, we have learned that once we step backwards and lose momentum, it becomes difficult to restart and recapture volume.

The recovery is difficult and expensive, and we end up coming back as the exact same company that we were before, with no significant changes for the future.

We believe we are starting to see a bottom in the free fall in our margin that began with the spike in interest rates in 2022.

Our construction costs have decreased over the past two and a half years, and we believe our margins will stabilize as we use our growing volume to work with our trade partners to reduce costs and build efficiencies.

With regard to our financial strategy of driving a land-light balance sheet, the Millrose spin-off was a critical part of this strategy, but there is more to accomplish.

Predictable volume creates greater certainty for the capital markets and will help build more capital-efficient land banking vehicles to interface with our business.

We are continuing to drive certainty with dependable volume for our land banking partners.

That dependability will translate into certainty and predictability for us.

Additionally, this part of our strategy benefits from efficiencies derived from our technology-enabled solutions.

We have spent considerable time working with, investing in, and exploring technology, and we believe that productivity and efficiencies can be significantly enhanced when these solutions achieve company-wide adoption.

But modern technology is not plug-and-play.

It requires substantial monetary investment, management time, and widespread engagement.

Looking ahead to the third quarter of 2025, we anticipate selling and delivering between 22,000 and 23,000 homes.

Our average sales price is expected to be between $380,000 and $385,000, as we continue to see pricing pressure on homes sold during the quarter.

We are focused on driving sales and closings and maintaining strong current cash flow even at reduced profitability.

We expect our margin to come in at approximately 18%, depending on market conditions.

For the full year, we expect to deliver at the low end of our previously stated range of 86,000 to 88,000 homes in 2025.

While the short-term road ahead may seem choppy, we are optimistic about our future.

We are well-prepared with a strong national footprint, increasing community count, and growing volume.

Our strong balance sheet and land banking relationships, along with our technology-enabled solutions, will afford us flexibility and advantaged opportunities for strategic growth.

(1) Results of Operations

We historically have experienced, and expect to continue to experience, variability in quarterly results.

Our results of operations for the three months ended February 28, 2025 are not necessarily indicative of the results to be expected for the full year.

Our results of operations for the three and six months ended May 31, 2025 are not necessarily indicative of the results to be expected for the full year.

Our homebuilding business is seasonal in nature and generally reflects higher levels of new home order activity in our second and third fiscal quarters and increased deliveries in the second half of our fiscal year.

However, a variety of factors can alter seasonal patterns.

Our net earnings attributable to Lennar were $519.5 million, or $1.96 per diluted share, in the first quarter of 2025, compared to net earnings attributable to Lennar of $719.3 million, or $2.57 per diluted share, in the first quarter of 2024.

Excluding mark-to-market losses on technology investments, first quarter net earnings attributable to Lennar in 2025 were $566.7 million, or $2.14 per diluted share, compared to first quarter net earnings attributable to Lennar in 2024 were $723.3 million or $2.58 per diluted share.

Our net earnings attributable to Lennar were $477.4 million, or $1.81 per diluted share, in the second quarter of 2025, compared to our second quarter net earnings attributable to Lennar in 2024 of $954.3 million, or $3.45 per diluted share.

Excluding mark-to-market losses on technology investments, second quarter net earnings attributable to Lennar in 2025 were $499.5 million, or $1.90 per diluted share.

Excluding mark-to-market losses on technology investments and one-time gain on the sale of a technology investment, our second quarter net earnings attributable to Lennar in 2024 were $935.3 million or $3.38 per diluted share.

Financial information relating to our operations was as follows:

Three Months Ended February 28, 2025

Three Months Ended May 31, 2025

(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate Total

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Equity in earnings (losses) from unconsolidated entities 17,716 — (5,269) (331) — 12,116

Other income, net and other gains 14,208 — 14,887 1,664 — 30,759

Lennar Other unrealized losses from technology investments — — — (29,440) — (29,440)

Operating earnings (loss) $ 728,234 157,280 (14,754) (52,895) — 817,865

Corporate general and administrative expenses — — — — 155,853 155,853

Charitable foundation contribution — — — — 20,131 20,131

Earnings (loss) before income taxes $ 728,234 157,280 (14,754) (52,895) (175,984) 641,881

Three Months Ended May 31, 2024

(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate Total

Sales of homes $ 8,357,750 — — — — 8,357,750

Sales of land 13,598 — — — — 13,598

Other revenues 9,711 281,723 99,500 3,310 — 394,244

Total revenues 8,381,059 281,723 99,500 3,310 — 8,765,592

Costs and expenses:

Costs of homes sold 6,469,952 — — — — 6,469,952

Costs of land sold 6,903 — — — — 6,903

Selling, general and administrative expenses 629,600 — — — — 629,600

Other costs and expenses — 134,711 102,205 26,841 — 263,757

Total costs and expenses 7,106,455 134,711 102,205 26,841 — 7,370,212

Equity in earnings (losses) from unconsolidated entities 15,516 — (17,557) (2,268) — (4,309)

Other income (expense), net and other gains (losses) 50,035 — (212) 18,349 — 68,172

Lennar Other realized and unrealized losses from technology investments — — — (62,503) — (62,503)

Lennar Other unrealized losses from technology investments — — — (21,514) — (21,514)

Operating earnings (loss) $ 1,340,155 147,012 (20,474) (28,964) — 1,437,729

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Earnings (loss) before income taxes $ 1,340,155 147,012 (20,474) (28,964) (176,672) 1,261,057

Three Months Ended February 29, 2024

Six Months Ended May 31, 2025

(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate Total

9 unchanged sentences

Total costs and expenses 13,687,512 274,412 328,053 53,589 — 14,343,566

Equity in losses from unconsolidated entities 13,302 — (12,606) (31,241) — (30,545)

Equity in earnings (losses) from unconsolidated entities 52,720 — (4,542) (2,827) — 45,351

Other income (expense), net and other gains (losses) 44,567 — 24,317 (6,458) — 62,426

Lennar Other realized and unrealized losses from technology investments — — — (91,943) — (91,943)

Operating earnings (loss) $ 1,537,507 300,763 (14,777) (142,178) — 1,681,315

Corporate general and administrative expenses — — — — 303,231 303,231

Charitable foundation contribution — — — — 37,965 37,965

Earnings (loss) before income taxes $ 1,537,507 300,763 (14,777) (142,178) (341,196) 1,340,119

Six Months Ended May 31, 2024

(In thousands) Homebuilding Financial Services Multifamily Lennar Other Corporate Total

Sales of homes $ 15,259,531 — — — — 15,259,531

Sales of land 34,350 — — — — 34,350

Other revenues 18,169 531,443 229,177 5,852 — 784,641

Total revenues 15,312,050 531,443 229,177 5,852 — 16,078,522

Homebuilding costs and expenses:

Costs of homes sold 11,865,484 — — — — 11,865,484

Costs of land sold 20,920 — — — — 20,920

Selling, general and administrative expenses 1,197,587 — — — — 1,197,587

Other costs and expenses — 253,135 234,872 35,929 523,936

Total costs and expenses 13,083,991 253,135 234,872 35,929 — 13,607,927

Equity in earnings (losses) from unconsolidated entities 28,818 — (30,163) (33,509) — (34,854)

Other income (expense), net and other gains (losses) 112,074 — (255) 21,725 — 133,544

Lennar Other unrealized losses from technology investments — — — (26,651) — (26,651)

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Earnings (loss) before income taxes $ 2,368,951 278,308 (36,113) (68,512) (350,791) 2,191,843

Three Months Ended February 28, 2025 versus Three Months Ended February 29, 2024

On February 10, 2025, we completed our acquisition of Rausch Coleman Homes.

The results of operations include activity related to Rausch Coleman Homes from February 10, 2025 to February 28, 2025.

Prior year information includes only stand-alone data for Lennar Corporation for the three months ended February 29, 2024.

Revenues from home sales increased 5% in the first quarter of 2025 to $7.2 billion from $6.9 billion in the first quarter of 2024.

Revenues were higher primarily due to a 6% increase in the number of home deliveries, partially offset by a 1% decrease in the average sales price of homes delivered.

New home deliveries increased to 17,834 homes in the first quarter of 2025 from 16,798 homes in the first quarter of 2024.

The average sales price of homes delivered was $408,000 in the first quarter of 2025, compared to $413,000 in the first quarter of 2024.

The decrease in average sales price of homes delivered in the first quarter of 2025 compared to the same period last year was primarily due to continued weakness in the market.

Gross margins on home sales were $1.4 billion, or 18.7% (18.8% excluding purchase accounting of $7.8 million), in the first quarter of 2025, compared to $1.5 billion, or 21.8%, in the first quarter of 2024.

During the first quarter of 2025, gross margins decreased due to an increase in land costs year over year, as well as a decrease in revenue per square foot, which was partially offset by a decrease in construction costs as we continue to focus on construction cost savings.

Selling, general and administrative expenses were $615.7 million in the first quarter of 2025, compared to $568.0 million in the first quarter of 2024.

As a percentage of revenues from home sales, selling, general and administrative expenses increased to 8.5% in the first quarter of 2025, from 8.2% in the first quarter of 2024, primarily due to an increase in marketing and selling expenses.

During the three months ended February 28, 2025, our homebuilding operating earnings included $23.2 million of interest income, compared to $57.6 million of interest income in the three months ended February 29, 2024.

Operating earnings for the Financial Services segment were $142.9 million in the first quarter of 2025, compared to $130.6 million in the first quarter of 2024.

The increase in operating earnings was primarily due to higher volume from increased Lennar deliveries.

The Multifamily operations were breakeven in the first quarter of 2025, compared to an operating loss of $15.5 million in the first quarter of 2024.

Operating loss for the Lennar Other segment was $89.3 million in the first quarter of 2025, compared to an operating loss of $39.5 million in the first quarter of 2024.

The Lennar Other operating loss for the first quarter of 2025 was primarily due to losses on our technology investments.

In the first quarter of 2025 and 2024, we had tax provisions of $169.5 million and $210.9 million, which resulted in an overall effective income tax rate of 24.6% and 22.7%, respectively.

On February 10, 2025, we completed our acquisition of Rausch Coleman Homes ("Rausch").

Prior year information includes only stand-alone data for Lennar Corporation for the three and six months ended May 31, 2024.

Three Months Ended May 31, 2025 versus Three Months Ended May 31, 2024

Revenues from home sales decreased 7% in the second quarter of 2025 to $7.8 billion from $8.4 billion in the second quarter of 2024.

Revenues were lower primarily due to a 9% decrease in the average sales price of homes delivered, partially offset by a 2% increase in the number of home deliveries.

New home deliveries increased to 20,131 homes in the second quarter of 2025 from 19,690 homes in the second quarter of 2024.

The average sales price of homes delivered was $389,000 in the second quarter of 2025, compared to $426,000 in the second quarter of 2024.

The decrease in average sales price of homes delivered in the second quarter of 2025 compared to the same period last year was primarily due to continued weakness in the market.

Gross margins on home sales were $1.4 billion, or 17.8% (18.0% excluding purchase accounting), in the second quarter of 2025, compared to $1.9 billion, or 22.6%, in the second quarter of 2024.

During the second quarter of 2025, gross margins decreased due to an increase in land costs year over year, as well as a decrease in revenue per square foot, which was partially offset by a decrease in construction costs as we continue to focus on construction cost savings.

Selling, general and administrative expenses were $688.8 million in the second quarter of 2025, compared to $629.6 million in the second quarter of 2024.

As a percentage of revenues from home sales, selling, general and administrative expenses increased to 8.8% in the second quarter of 2025, from 7.5% in the second quarter of 2024, primarily due to less leverage as a result of lower revenues and an increase in marketing and selling expenses.

During the three months ended May 31, 2025, our homebuilding operating earnings included $13.8 million of interest income, compared to $43.2 million of interest income in the three months ended May 31, 2024.

The decrease in interest income was primarily due to lower cash balances year over year.

Operating earnings for the Financial Services segment were $156.6 million in the second quarter of 2025, compared to $146.3 million in the second quarter of 2024.

The increase in operating earnings was primarily due to higher profit per locked loan in the mortgage business as a result of higher margins.

Operating loss for the Multifamily segment was $14.8 million in the second quarter of 2025, compared to an operating loss of $20.4 million in the second quarter of 2024.

Operating loss for the Lennar Other segment was $52.9 million in the second quarter of 2025, compared to an operating loss of $27.9 million in the second quarter of 2024.

The Lennar Other operating loss

for the second quarter of 2025 was primarily due to losses on our technology investments.

The Lennar Other operating loss for the second quarter of 2024 includes $21.5 million of mark-to-market losses on our publicly traded technology investments and a $46.5 million one-time gain on the sale of a technology investment.

In the second quarter of 2025 and 2024, we had tax provisions of $160.1 million and $300.5 million, which resulted in an overall effective income tax rate of 25.1% and 23.9%, respectively.

For both periods, our effective income tax rate included state income tax expense and non-deductible executive compensation, partially offset by tax credits.

The increase in the effective tax rate from the prior year for the first quarter of 2025 was primarily due to a decrease in excess tax benefits from share-based compensation and a decrease in solar tax credits.

The increase in the effective tax rate in the second quarter of 2025 from the prior year was primarily due to a decrease in solar tax credits.

Six Months Ended May 31, 2025 versus Six Months Ended May 31, 2024

Revenues from home sales were $15.0 billion and $15.3 billion in the six months ended May 31, 2025 and 2024, respectively.

Revenues were flat primarily because of a 4% increase in the number of home deliveries, which was offset by a 5% decrease in average sales price of home deliveries.

New home deliveries increased to 37,965 homes in the six months ended May 31, 2025 from 36,488 homes in the six months ended May 31, 2024.

The average sales price of homes delivered was $398,000 in the six months ended May 31, 2025, compared to $420,000 in the six months ended May 31, 2024.

The decrease in average sales price of homes delivered in the six months ended May 31, 2025 compared to the same period last year was primarily due to continued weakness in the market.

Gross margins on home sales were $2.7 billion, or 18.2% (18.4% excluding purchase accounting), in the six months ended May 31, 2025, compared to $3.4 billion, or 22.2%, in the six months ended May 31, 2024.

During the six months ended May 31, 2025, gross margins decreased due to an increase in land costs year over year, as well as a decrease in revenue per square foot, which was partially offset by a decrease in construction costs as we continue to focus on construction cost savings.

Selling, general and administrative expenses were $1.3 billion in the six months ended May 31, 2025, compared to $1.2 billion in the six months ended May 31, 2024.

As a percentage of revenues from home sales, selling, general and administrative expenses increased to 8.7% in the six months ended May 31, 2025, from 7.8% in the six months ended May 31, 2024, primarily due to less leverage as a result of lower revenues and an increase in marketing and selling expenses.

During the six months ended May 31, 2025, our homebuilding operating earnings included $37.0 million of interest income, compared to $100.8 million of interest income in the six months ended May 31, 2024.

The decrease in interest income was primarily due to lower cash balances year over year.

Operating earnings for the Financial Services segment were $299.5 million in the six months ended May 31, 2025, compared to $276.9 million in the six months ended May 31, 2024.

The increase in operating earnings was primarily due to higher profit per locked loan in the mortgage business as a result of higher margins.

Operating loss for the Multifamily segment was $14.5 million in the six months ended May 31, 2025, compared to operating loss of $35.9 million in the six months ended May 31, 2024.

Operating loss for the Lennar Other segment was $142.2 million in the six months ended May 31, 2025, compared to operating loss of $67.4 million in the six months ended May 31, 2024.

The Lennar Other operating loss for the second quarter of 2025 was primarily due to losses on our technology investments.

The Lennar Other operating loss for the six months ended May 31, 2024 included $26.7 million of mark-to-market losses on our publicly traded technology investments and a $46.5 million one-time gain on the sale of a technology investment.

For the six months ended May 31, 2025 and 2024, we had tax provisions of $329.6 million and $511.3 million, respectively, which resulted in overall effective income tax rates of 24.8% and 23.4%, respectively.

For both periods, our effective income tax rate included state income tax expense and non-deductible executive compensation, partially offset by tax credits.

The increase in the effective tax rate in the six months ended May 31, 2025 from the prior year was primarily due to a decrease in excess tax benefits from share-based compensation and a decrease in solar tax credits.

Homebuilding Segments

At February 28, 2025, our reportable Homebuilding segments and Homebuilding Other are outlined in Note 3 of the Notes to Condensed Consolidated Financial Statements.

At May 31, 2025, our reportable Homebuilding segments and Homebuilding Other are outlined in Note 3 of the Notes to Condensed Consolidated Financial Statements.

The following tables set forth selected financial and operational information related to our homebuilding operations for the periods indicated:

Selected Financial and Operational Data

Three Months Ended February 28, 2025

Gross Margins Operating Earnings (Loss)

($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin % Net Margins (Loss) on Sales of Homes (1) Gross Margins (Loss) on Sales of Land Other Revenues Equity in Earnings (Losses) from Unconsolidated Entities Other Income, net Operating Earnings

Three Months Ended May 31, 2025

Gross Margins Operating Earnings

($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin (Loss) % Net Margins (Losses) on Sales of Homes (1) Gross Margins (Losses) on Sales of Land Other Revenues Equity in Earnings (Losses) from Unconsolidated Entities Other Income (Expense), net Operating Earnings

East $ 1,689,129 1,367,873 19.0 % 154,866 793 3,714 8,295 7,336 175,004

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$ 7,788,275 6,402,532 17.8 % 696,896 (12,978) 12,392 17,716 14,208 728,234

Three Months Ended February 29, 2024

Gross Margins Operating Earnings (Loss)

($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin % Net Margins (Loss) on Sales of Homes (1) Gross Margins (Loss) on Sales of Land Other Revenues Equity in Earnings from Unconsolidated Entities Other Income (Expense), net Operating Earnings

Three Months Ended May 31, 2024

Gross Margins Operating Earnings

East $ 2,123,136 1,555,904 26.7 % 389,854 6,332 2,896 5,317 22,649 427,048

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$ 8,357,750 6,469,952 22.6 % 1,258,198 6,695 9,711 15,516 50,035 1,340,155

Six Months Ended May 31, 2025

Gross Margins Operating Earnings

($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin (Loss) % Net Margins (Losses) on Sales of Homes (1) Gross Margins (Losses) on Sales of Land Other Revenue Equity in Earnings (Losses) from Unconsolidated Entities Other Income (Expense), net Operating Earnings

East $ 3,317,027 2,646,520 20.2 % 342,915 865 6,449 14,933 32,464 397,626

Central 3,327,136 2,710,067 18.5 % 297,005 (3,690) 2,817 (4) 3,163 299,291

South Central 2,666,273 2,188,413 17.9 % 257,127 1,249 1,759 (8) (1,355) 258,772

West 5,707,665 4,733,641 17.1 % 554,488 (12,153) 3,343 1,010 (2,483) 544,205

Other (2) 10,720 12,035 (12.3) % (17,976) — 6,022 36,789 12,778 37,613

$ 15,028,821 12,290,676 18.2 % 1,433,559 (13,729) 20,390 52,720 44,567 1,537,507

Six Months Ended May 31, 2024

Gross Margins Operating Earnings

($ in thousands) Sales of Homes Revenue Costs of Sales of Homes Gross Margin (Loss) % Net Margins (Losses) on Sales of Homes (1) Gross Margins (Losses) on

Sales of Land Other Revenue Equity in Earnings (Losses) from Unconsolidated Entities Other Income, net Operating Earnings

East $ 3,986,022 2,898,873 27.3 % 736,193 11,596 5,207 12,414 38,548 803,958

Central 3,210,271 2,540,020 20.9 % 377,889 (451) 2,322 6 18,293 398,059

South Central 2,264,683 1,744,100 23.0 % 340,993 1,434 1,292 (3) 9,441 353,157

West 5,785,395 4,665,604 19.4 % 754,515 851 3,208 3,713 25,437 787,724

Other (2) 13,160 16,887 (28.3) % (13,130) — 6,140 12,688 20,355 26,053

$ 15,259,531 11,865,484 22.2 % 2,196,460 13,430 18,169 28,818 112,074 2,368,951

(1) Net margins on sales of homes include selling, general and administrative expenses.

(2) Negative gross and net margins were due to period costs and/or impairments in Urban divisions that impact costs of homes sold without sufficient sales of homes revenue to offset those costs.

(2) Negative gross and net margins were due to period costs in Urban divisions that impact costs of homes sold without sufficient sales of homes revenue to offset those costs.

Summary of Homebuilding Data

First Quarter

Three Months Ended May 31,

2025 2024 2025 2024 2025 2024

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Total 20,131 19,690 $ 7,839,327 8,392,931 $ 389,000 426,000

Of the total homes delivered listed above, 80 homes with a dollar value of $41.0 million and an average sales price of $512,000 represent home deliveries from unconsolidated entities for the three months ended February 28, 2025, compared to 77 home deliveries with a dollar value of $43.0 million and an average sales price of $558,000 for the three months ended February 29, 2024.

Of the total homes delivered listed above, 113 homes with a dollar value of $51.1 million and an average sales price of $452,000 represent homes from unconsolidated entities for the three months ended May 31, 2025, compared to 70 homes with a dollar value of $35.2 million and an average sales price of $503,000 for the three months ended May 31, 2024.

Six Months Ended May 31,

2025 2024 2025 2024 2025 2024

Homes Dollar Value (In thousands)

Average Sales Price

East 8,987 9,907 $ 3,409,061 4,064,163 $ 379,000 410,000

Central 8,633 8,094 3,327,137 3,210,271 385,000 397,000

South Central 10,904 8,932 2,666,273 2,264,683 245,000 254,000

West 9,425 9,530 5,707,665 5,785,395 606,000 607,000

Other 16 25 10,720 13,160 670,000 526,000

Total 37,965 36,488 $ 15,120,856 15,337,672 $ 398,000 420,000

Of the total homes delivered listed above, 193 homes with a dollar value of $92.0 million and an average sales price of $477,000 represent homes from unconsolidated entities for the six months ended May 31, 2025, compared to 147 homes with a dollar value of $78.1 million and an average sales price of $532,000 for the six months ended May 31, 2024.

Sales Incentives (1):

First Quarter

Three Months Ended May 31, Six Months Ended May 31,

2025 2024 2025 2024 2025 2024 2025 2024

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Home Delivered Sales Incentives

as a % of Revenue Average Sales Incentives Per

Home Delivered Sales Incentives

as a % of Revenue

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Total $ 59,500 44,200 13.3 % 9.4 % $ 60,000 47,100 13.1 % 10.1 %

(1) Sales incentives relate to home deliveries during the period, excluding deliveries by unconsolidated entities.

(1) Sales incentives relate to homes delivered during the period, excluding homes delivered by unconsolidated entities.

New Orders (2):

First Quarter

Three Months Ended May 31,

2025 2024 2025 2024 2025 2024 2025 2024

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Total 1,617 1,245 22,601 21,293 $ 8,575,263 9,194,876 $ 379,000 432,000

Of the total homes listed above, 101 homes with a dollar value of $59.9 million and an average sales price of $593,000 represent homes in 11 active communities from unconsolidated entities for the three months ended February 28, 2025, compared to 46 homes with a dollar value of $25.2 million and an average sales price of $548,000 in six active communities for the three months ended February 29, 2024.

(2) Homes represent the number of new sales contracts executed with homebuyers, net of cancellations, during the three months ended February 28, 2025 and February 29, 2024.

Of the total new orders listed above, 141 homes with a dollar value of $69.8 million and an average sales price of $495,000 represent homes in 10 active communities from unconsolidated entities for the three months ended May 31, 2025, compared to 74 homes with a dollar value of $40.0 million and an average sales price of $540,000 in eight active communities for the three months ended May 31, 2024.

Six Months Ended May 31,

2025 2024 2025 2024 2025 2024

Homes Dollar Value (In thousands) Average Sales Price

East 9,476 9,141 $ 3,463,930 3,810,481 $ 366,000 417,000

Central 10,007 9,991 3,864,160 3,983,784 386,000 399,000

South Central 11,547 9,644 2,780,180 2,452,391 241,000 254,000

West 9,909 10,662 5,886,178 6,675,384 594,000 626,000

Other 17 31 11,547 15,218 679,000 491,000

Total 40,956 39,469 $ 16,005,995 16,937,258 $ 391,000 429,000

Of the total new orders listed above, 242 homes with a dollar value of $129.7 million and an average sales price of $536,000 represent homes from unconsolidated entities for the six months ended May 31, 2025, compared to 120 homes with a dollar value of $65.2 million and an average sales price of $543,000 for the six months ended May 31, 2024.

(2) Homes represent the number of new sales contracts executed with homebuyers, net of cancellations, during the three and six months ended May 31, 2025 and May 31, 2024.

We experienced cancellation rates in our Homebuilding segments and Homebuilding Other as follows:

First Quarter

Three Months Ended Six Months Ended

May 31, May 31,

2025 2024 2025 2024

East 14 % 17 % 15 % 17 %

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Total 14 % 13 % 14 % 14 %

First Quarter

2025 (1) 2024 2025 2024 2025 2024

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Total 15,538 17,873 $ 6,484,490 8,233,335 $ 417,000 461,000

Of the total homes in backlog listed above, 100 homes with a backlog dollar value of $82.7 million and an average sales price of $827,000 represent the backlog from unconsolidated entities at February 28, 2025, compared to 116 homes with a backlog dollar value of $57.5 million and an average sales price of $495,000 at February 29, 2024.

(1) As of February 28, 2025, backlog includes 980 homes acquired in connection with the Rausch Coleman Homes acquisition.

Of the homes in backlog, 214 and 766 homes were in the Central and South Central homebuilding segments, respectively.

As of February 28, 2025, backlog also includes 11 homes acquired from a small builder in the West homebuilding segment.

Of the total homes in backlog listed above, 128 homes with a backlog dollar value of $101.4 million and an average sales price of $792,000 represent the backlog from unconsolidated entities at May 31, 2025, compared to 120 homes with a backlog dollar value of $61.5 million and an average sales price of $513,000 at May 31, 2024.

(3) During the six months ended May 31, 2025, backlog includes 914 acquired homes of which 186, 717 and 11 homes were in the Central, South Central and West homebuilding segments, respectively.

Backlog represents the number of homes under sales contracts.

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We do not recognize revenue on homes under sales contracts until the sales are closed and title passes to the new homeowners.

Three Months Ended February 28, 2025 versus Three Months Ended February 29, 2024

Three Months Ended May 31, 2025 versus Three Months Ended May 31, 2024

Homebuilding East:

Revenues from home sales decreased in the first quarter of 2025 compared to the first quarter of 2024, primarily due to a decrease in both the average sales price of homes delivered and the number of home deliveries in all the states in the segment except in New Jersey, which was partially offset by an increase in the average sales price of homes delivered and the number of home deliveries in New Jersey.

The decrease in the average sales price of homes delivered in Florida and Pennsylvania was primarily due to pricing to market through an increased use of incentives and product mix.

The increase in the average sales price of homes delivered in New Jersey was primarily due to product mix.

The decrease in the number of home deliveries in Florida and Pennsylvania was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities.

The increase in the number of home deliveries in New Jersey was primarily due to an increase in the number of active communities.

In the first quarter of 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

Revenues from home sales decreased in the second quarter of 2025 compared to the second quarter of 2024, primarily due to a decrease in the number of homes delivered in all the states of the segment and lower average sales price on homes delivered in all the states of the segment except in New Jersey.

The overall decrease in the number of homes delivered was primarily due to a decrease in the number of homes delivered per active community due to the timing of opening and closing of communities.

The overall decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives and product mix.

In the second quarter of 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

In addition, land costs increased year over year.

Overall, gross margin percentage of home deliveries decreased year over year.

Overall, gross margin percentage of homes delivered decreased year over year.

Homebuilding Central:

Revenues from home sales increased in the first quarter of 2025 compared to the first quarter of 2024, primarily due to an increase in the number of home deliveries in all the states in the segment except in Maryland, Minnesota and South Carolina, which was partially offset by a decrease in the average sales price of homes delivered in Alabama, Georgia, North Carolina, South Carolina and Virginia.

The increase in the number of home deliveries in Alabama, Georgia, Illinois, Indiana, North Carolina, Tennessee and Virginia was primarily due to an increase in the number of active communities including communities acquired from Rausch.

The decrease in the number of home deliveries in Maryland, Minnesota and South Carolina was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities.

The decrease in the average sales price of homes delivered in Alabama, Georgia, North Carolina, South Carolina and Virginia was primarily due to pricing to market through an increased use of incentives and product mix.

The increase in the average sales price of homes delivered in Illinois, Indiana, Maryland, Minnesota and Tennessee was primarily due to product mix.

In the first quarter of 2025, an increase in revenues per square foot and a decrease in costs per square foot was more than offset by an increase in land costs per square foot.

Overall, the gross margin percentage of home deliveries decreased year over year.

Revenues from home sales were flat in the second quarter of 2025 compared to the second quarter of 2024, primarily due to an increase in the number of homes delivered in all states of the segment except in Georgia, Illinois, Indiana, Maryland, Minnesota and South Carolina, which was offset by a decrease in the average sales price of homes delivered in Alabama, Illinois, Maryland, North Carolina, South Carolina and Virginia.

The overall increase in the number of homes delivered was primarily due to an increase in the number of active communities including communities acquired from Rausch.

The overall decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives and product mix.

In the second quarter of 2025, a decrease in revenues per square foot was offset by a decrease in costs per square foot.

In addition, land costs increased year over year.

Overall, gross margin percentage of homes delivered decreased year over year.

Homebuilding South Central:

Revenues from home sales increased in the first quarter of 2025 compared to the first quarter of 2024, primarily due to an increase in the number of home deliveries in all states in the segment, which was partially offset by a decrease in the average sales price of homes delivered.

The increase in the number of home deliveries was primarily due to an increase in the number of active communities including communities acquired from Rausch.

Revenues from home sales increased in the second quarter of 2025 compared to the second quarter of 2024, primarily due to the Rausch acquisition which resulted in an increase in the number of homes delivered in all states in the segment, partially offset by a decrease in the average sales price of homes delivered.

The overall increase in the number of homes delivered was primarily due to an increase in the number of active communities including communities acquired from Rausch.

The decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives and product mix and product mix.

In the second quarter of 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

In addition, land costs increased year over year.

Overall, the gross margin percentage of homes delivered decreased year over year.

Homebuilding West:

Revenues from home sales decreased in the second quarter of 2025 compared to the second quarter of 2024, primarily due to decreases in the number of homes delivered in all the states in the segment except in Idaho and Utah and in the average sales price of homes delivered in all the states in the segment except California and Idaho.

The overall decrease in the number of homes delivered was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities.

The overall decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives.

In the second quarter of 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

In addition, land costs increased year over year.

Overall, the gross margin percentage of homes delivered decreased year over year.

Six Months Ended May 31, 2025 versus Six Months Ended May 31, 2024

Homebuilding East:

Revenues from home sales decreased in the six months ended May 31, 2025 compared to the six months ended May 31, 2024, primarily due to decreases in the number of homes delivered in all the states in the segment and the average sales price of homes delivered in all the states in the segment except in New Jersey.

The overall decrease in the number of homes delivered was primarily due to a decrease in the number of homes delivered per active community due to the timing of opening and closing of communities.

The overall decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives and product mix.

In the six months ended May 31, 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

In addition, land costs increased year over year.

Overall, gross margin percentage of homes delivered decreased year over year.

Homebuilding Central:

Revenues from home sales increased in the six months ended May 31, 2025 compared to the six months ended May 31, 2024, primarily due to an increase in the number of homes delivered in all the states in the segment except in Maryland, Minnesota and South Carolina, which was partially offset by a decrease in the average sales price of homes delivered in all the states in the segment except in Indiana, Minnesota and Tennessee.

The overall increase in the number of homes delivered was primarily due to an increase in the number of active communities including communities acquired from Rausch.

The overall decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives and product mix.

In the six months ended May 31, 2025, a decrease in revenues per square foot was partially offset by a decreas

e in costs per square foot.

In addition, land costs increased year over year.

Overall, gross margin percentage of homes delivered decreased year over year.

Homebuilding South Central:

Revenues from home sales increased in the six months ended May 31, 2025, compared to the six months ended May 31, 2024, primarily due to the Rausch acquisition which resulted in an increase in the number of homes delivered in all states in the segment, partially offset by a decrease in the average sales price of homes delivered.

The overall increase in the number of homes delivered was primarily due to an increase in the number of active communities including communities acquired from Rausch.

The decrease in the average sales price of homes delivered was primarily due to pricing to market through an increased use of incentives and product mix.

In the first quarter of 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

In the six months ended May 31, 2025, a decrease in revenues per square foot was partially offset by a decrease in costs per square foot.

In addition, land costs increased year over year.

Overall, the gross margin percentage of home deliveries decreased year over year.

Overall, the gross margin percentage of homes delivered decreased year over year.

Homebuilding West:

Revenues from home sales increased in the first quarter of 2025 compared to the first quarter of 2024, primarily due to an increase in the number of home deliveries in all the states in the segment except in Colorado, Nevada and Oregon, which was partially offset by a decrease in the average sales price of homes delivered in all the states in the segment except in California and Idaho.

The increase in the number of home deliveries in Arizona, California, Idaho, Utah and Washington was primarily due to an increase in the number of active communities and deliveries per active community.

The decrease in the number of home deliveries in Colorado, Nevada and Oregon was primarily due to a decrease in the number of deliveries per active community due to the timing of opening and closing of communities.

The decrease in the average sales price of homes delivered in Arizona, Colorado, Nevada, Oregon, Utah and Washington was primarily due to pricing to market through an increased use of incentives.

The increase in the average sales price of homes delivered in California and Idaho was primarily due to product mix.

In the first quarter of 2025, an increase in revenues per square foot and a decrease in costs per square foot were more than offset by an increase in land costs per square foot.

Overall, the gross margin percentage of home deliveries decreased year over year.

Revenues from home sales decreased in the six months ended May 31, 2025 compared to the six months ended May 31, 2024, primarily due to a decrease in the number of homes delivered in all the states in the segment except in Arizona, Idaho, Utah and Washington.

The overall decrease in the number of homes delivered was primarily due to a decrease in the number of homes delivered per active community due to the timing of opening and closing of communities.

In the six months ended May 31, 2025, revenues per square foot were flat while costs per square foot decreased.

In addition, land costs increased year over year.

Overall, the gross margin percentage of homes delivered decreased year over year.

Financial Services Segment

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The following table sets forth selected financial and operational information related to the residential mortgage and title activities of our Financial Services segment:

Three Months Ended

(Dollars in thousands) February 28, 2025 February 29, 2024

Three Months Ended Six Months Ended

May 31, May 31,

(Dollars in thousands) 2025 2024 2025 2024

Dollar value of mortgages originated $ 4,877,000 4,998,000 9,320,000 9,110,000

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Number of title and closing service transactions 21,000 20,200 39,200 38,000

At February 28, 2025 and November 30, 2024, the carrying value of Financial Services' commercial mortgage-backed securities was $134.4 million and $135.6 million, respectively.

At May 31, 2025 and November 30, 2024, the carrying value of Financial Services' commercial mortgage-backed securities was $134.3 million and $135.6 million, respectively.

Details of these securities and related debt are disclosed in Note 3 of the Notes to Condensed Consolidated Financial Statements.

Multifamily Segment

We have been actively involved, primarily through unconsolidated funds and joint ventures, in the development, construction and property management of multifamily rental properties.

We have been actively involved, primarily through unconsolidated funds and joint ventures, in the development and construction of multifamily rental properties.

Our Multifamily segment focuses on developing a geographically diversified portfolio of institutional quality multifamily rental properties in select U.S.

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Balance Sheets

(In thousands) February 28, 2025 November 30, 2024

(In thousands) At May 31, 2025 At November 30, 2024

Multifamily investments in unconsolidated entities $ 518,453 503,303

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During the year ended November 30, 2024, 33 LMV I rental operation projects were sold to various third-party buyers.

As of February 28, 2025, two additional LMV I rental operation projects were sold to various third-party buyers.

During the six months ended May 31, 2025, two additional LMV I rental operation projects were sold to third-party buyers.

Lennar Other Segment

Our Lennar Other segment includes fund investments we retained subsequent to our sale of the Rialto investment and asset management platform, as well as strategic investments in technology companies that are looking to improve the homebuilding and financial services industries to better serve homebuyers and homeowners and increase efficiencies.

At February 28, 2025 and November 30, 2024, we had $824.2 million and $894.9 million, respectively, of assets in our Lennar Other segment, which included investments in unconsolidated entities of $375.4 million and $379.4 million, respectively.

The investments in equity securities of Blend Labs, Inc.

At May 31, 2025 and November 30, 2024, we had $790.5 million and $894.9 million, respectively, of assets in our Lennar Other segment, which included investments in unconsolidated entities of $368.0 million and $379.4 million, respectively.

We have/had investments in Blend Labs, Inc.

(“Blend Labs”), Hippo Holdings, Inc.

(“Hippo”), Opendoor Technologies, Inc.

(“Opendoor”), SmartRent, Inc.

(“Hippo”), Opendoor Technologies, Inc.(“Opendoor”), SmartRent, Inc.

(“SmartRent”), Sonder Holdings, Inc.

(“Sonder”) and Sunnova Energy International, Inc.

(“Sunnova”) are carried at market and will therefore change depending on the market value of our shareholdings in those entities on the last day of each quarter.

(“Sunnova”), which are held at market and the carrying value of which will therefore change depending on the value of our shareholdings in those entities on the last day of each quarter.

All of the investments are accounted for as investments in equity securities which are held at fair value and the changes in fair values are recognized through earnings.

Details of these investments are included within Note 3 of the Notes to Condensed Consolidated Financial Statements.

The following is a detail of Lennar Other realized and unrealized gains (losses) from sales of shares and mark-to-market adjustments on our publicly traded technology investments:

Three Months Ended

(In thousands) February 28, 2025 February 29, 2024

The following is a detail of Lennar Other realized and unrealized losses from sales of shares and mark-to-market adjustments on our publicly traded technology investments:

Three Months Ended Six Months Ended

May 31, May 31,

(In thousands) 2025 2024 2025 2024

Blend Labs (BLND) $ — 715 (3,737) 3,651

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Lennar Other realized and unrealized losses from technology investments (1) $ (29,440) (21,514) (91,943) (26,651)

(1) During the three months ended February 28, 2025, we realized a loss of $28.4 million on the sale of our shares in Blend Labs, SmartRent, Sonder and Sunnova and, as of February 28, 2025, have a small remaining interest in Sunnova.

(1) During the six months ended May 31, 2025, we realized a loss of $28.4 million on the sale of our shares in Blend Labs, SmartRent, Sonder and Sunnova and, as of May 31, 2025, have a small remaining interest in Sunnova.

(2) Financial Condition and Capital Resources

At February 28, 2025, we had cash and cash equivalents and restricted cash related to our homebuilding, financial services, multifamily and other operations of $2.6 billion, compared to $5.0 billion at November 30, 2024 and $5.3 billion at February 29, 2024.

At May 31, 2025, we had cash and cash equivalents and restricted cash related to our homebuilding, financial services, multifamily and other operations of $1.5 billion, compared to $5.0 billion at November 30, 2024 and $3.9 billion at May 31, 2024.

We finance all of our activities, including homebuilding, financial services, multifamily, other and general operating needs, primarily with cash generated from our operations, debt issuances and cash borrowed under our warehouse lines of credit and our unsecured revolving credit facility (the “Credit Facility”).

At February 28, 2025, we had $2.3 billion of homebuilding cash and cash equivalents and no outstanding borrowings under our $3.0 billion revolving credit facility, thereby providing approximately $5.3 billion of available capacity.

At May 31, 2025, we had $1.2 billion of homebuilding cash and cash equivalents and ended the second quarter with a total liquidity of $5.4 billion.

Operating Cash Flow Activities

During the three months ended February 28, 2025 and February 29, 2024, cash (used in) provided by operating activities totaled ($289) million and $368 million, respectively.

During the three months ended February 28, 2025, cash used in operating activities was impacted by an increase in inventories due to strategic land purchases, land development and construction costs of $513 million, an increase in deposits and pre-acquisition costs on real estate of $758 million as we increased the percentage of controlled homesites primarily as a result of option contracts with Millrose Properties, Inc.

("Millrose"), and a decrease in accounts payable and other liabilities of $215 million.

During the six months ended May 31, 2025 and 2024, cash (used in) provided by operating activities totaled ($1.4) billion and $610 million, respectively.

During the six months ended May 31, 2025, cash used in operating activities was impacted by an increase in inventories due to land purchases, land development and construction costs of $1.6 billion, an increase in deposits and pre-acquisition costs on real estate of $782 million as we increased the percentage of controlled homesites primarily as a result of option contracts with Millrose, and a decrease in accounts payable and other liabilities of $600 million.

This was offset by our net earnings and a decrease in loans held-for-sale of $361 million primarily related to the sale of loans originated by our Financial Services segment.

During the three months ended February 29, 2024, cash provided by operating activities was impacted primarily by our net earnings, a decrease in loans held-for-sale of $54 million primarily related to the sale of loans originated by our Financial Services segment and a decrease in receivables of $379 million primarily related to a decrease in Financial Services receivables, net, which are loans sold to investors for which we have not yet been paid.

During the six months ended May 31, 2024, cash provided by operating activities was impacted primarily by our net earnings, a decrease in loans held-for-sale of $336 million primarily related to the sale of loans originated by our Financial Services segment.

This was partially offset by an increase in inventories due to strategic land purchases, land development and construction costs of $631 million, an increase in deposits and pre-acquisition costs on real estate of $755 million as we increased the percentage of controlled homesites, and a decrease in accounts payable and other liabilities of $381 million.

Investing Cash Flow Activities

During the three months ended February 28, 2025 and February 29, 2024, cash provided by (used in) investing activities totaled $21 million and ($148) million, respectively.

During the three months ended February 28, 2025, our cash provided by investing activities was primarily due to $233 million received from the sale of an investment in a joint venture, $72 million

proceeds from the sale of investments and distributions of capital from unconsolidated entities of $35 million, which primarily included (1) $15 million from Homebuilding unconsolidated entities, (2) $17 million from Multifamily entities and (3) $4 million from our Lennar Other unconsolidated entities.

This was partially offset by the $231 million acquisition of Rausch Coleman Homes ("Rausch"), net of cash acquired.

During the six months ended May 31, 2025 and 2024, cash provided by (used in) investing activities totaled $183 million and ($275) million, respectively.

During the six months ended May 31, 2025, our cash provided by investing activities was primarily due to $233 million received from the sale of an investment in a joint venture, $72 million proceeds from the sale of investments and distributions of capital from unconsolidated entities of $175 million, which primarily included (1) $32 million from Homebuilding unconsolidated entities, (2) $129 million from Multifamily entities and (3) $15 million from our Lennar Other

unconsolidated entities and $115 million proceeds from the sale of notes receivables.

This was partially offset by the $254 million acquisition of Rausch, net of cash acquired.

In addition, we had cash contributions of $145 million to unconsolidated entities, which included (1) $124 million to Homebuilding unconsolidated entities, (2) $7 million to Lennar other unconsolidated entities and (3) $14 million to Multifamily unconsolidated entities and $71 million of net additions of operating properties and equipment.

During the three months ended February 29, 2024, our cash used in investing activities was primarily due to cash contributions of $118 million to unconsolidated entities, which included (1) $56 million to Homebuilding unconsolidated entities, (2) $54 million to Lennar Other unconsolidated entities, and (3) $7 million to Multifamily unconsolidated entities.

During the six months ended May 31, 2024, our cash used in investing activities was primarily due to cash contributions of $248 million to unconsolidated entities, which included (1) $118 million to Homebuilding unconsolidated entities, (2) $117 million to Lennar Other unconsolidated entities, and (3) $13 million to Multifamily unconsolidated entities and $112 million of net additions of operating properties and equipment.

This was partially offset by distributions of capital from unconsolidated entities of $62 million, which primarily included (1) $40 million from Homebuilding unconsolidated entities, (2) $16 million from our Lennar Other unconsolidated entities, and (3) $6 million from Multifamily entities.

Financing Cash Flow Activities

During the three months ended February 28, 2025 and February 29, 2024, cash used in financing activities totaled $2.1 billion and $1.5 billion, respectively.

During the three months ended February 28, 2025, cash used in financing activities was primarily due to (1) $534 million of net repayments under our Financial Services' warehouse facilities;

(2) $416 million net cash in connection with Millrose spin-off;

During the six months ended May 31, 2025 and 2024, cash used in financing activities totaled $2.3 billion and $3.0 billion, respectively.

During the six months ended May 31, 2025, cash used in financing activities was primarily due to (1) $515 million of net repayments under our Financial Services' warehouse facilities;

(2) redemption of $500 million aggregate principal amount of our 4.75% senior notes due May 2025;

(3) $416 million net cash in connection with the Millrose spin-off;

(4) $386 million of net payments from liabilities related to consolidated inventory not owned due to activity with land banks;

(4) $775 million of repurchases of our common stock, which included $710 million of repurchases under our repurchase program and $65 million of repurchases related to our equity compensation plan;

(5) $1.3 billion of repurchases of our common stock, which included $1.2 billion of repurchases under our repurchase program and $65 million of repurchases related to our equity compensation plan;

and (6) $265 million of dividend payments.

During the three months ended February 29, 2024, cash used in financing activities was primarily due to (1) $600 million of net repayments under our Financial Services' warehouse facilities;

(2) $595 million of repurchases of our common stock, which included $512 million of repurchases under our repurchase program and $84 million of repurchases related to our equity compensation plan;

The cash used in financing activities was partially offset by the receipt of proceeds of the sale of $700 million aggregate principal amount of our 5.20% senior notes due 2030 and $400 million of net borrowings under our unsecured revolving credit facility.

During the six months ended May 31, 2024, cash used in financing activities was primarily due to (1) $754 million of net repayments under our Financial Services' warehouse facilities;

(2) redemption of $454 million aggregate principal amount of our 4.50% senior notes due April 2024;

(3) $100 million of partial repurchase of our 4.75% senior notes due 2027 (4) $1.2 billion of repurchases of our common stock, which included $1.1 billion of repurchases under our repurchase program and $86 million of repurchases related to our equity compensation plan;

(5) $278 million of dividend payments;

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Homebuilding debt to total capital and net Homebuilding debt to total capital are calculated as follows:

(Dollars in thousands) February 28, 2025 November 30, 2024 February 29, 2024

(Dollars in thousands) May 31, 2025 November 30, 2024 May 31, 2024

Homebuilding debt $ 2,791,987 2,258,283 2,241,507

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Rather, this non-GAAP financial measure should be used to supplement our GAAP results.

At February 28, 2025, Homebuilding debt to total capital was higher compared to November 30, 2024, primarily as a result of a decrease in stockholders' equity due to the spin-off of Millrose and share repurchases, partially offset by net earnings and a decrease in Homebuilding debt due to debt paydowns.

At February 28, 2025, Homebuilding debt to total capital was lower compared to February 29, 2024, primarily as a result of a decrease in stockholders' equity due to the spin-off of Millrose and share repurchases, partially offset by net earnings and a decrease in Homebuilding debt due to debt paydowns.

At May 31, 2025, Homebuilding debt to total capital was higher compared to November 30, 2024, primarily as a result of a decrease in stockholders' equity due to the spin-off of Millrose, share repurchases, issuance of senior notes and outstanding borrowings under our Credit Facility, partially offset by net earnings and a decrease in Homebuilding debt due to debt paydowns.

At May 31, 2025, Homebuilding debt to total capital was higher compared to May 31, 2024, primarily as a result of a decrease in stockholders' equity due to the spin-off of Millrose, share repurchases, issuance of senior notes and outstanding borrowings under our Credit Facility, partially offset by net earnings and a decrease in Homebuilding debt due to debt paydowns.

We are continually exploring various types of transactions to manage our leverage and liquidity positions, take advantage of market opportunities and increase our revenues and earnings.

These transactions may include the issuance of additional indebtedness, the repurchase of our outstanding indebtedness, the repurchase of our common stock, the acquisition of homebuilders and other companies, the purchase or sale of assets or lines of business, the issuance of common stock, strategic transactions to accelerate our land light strategy or securities convertible into shares of common stock, and/or the pursuit of other financing alternatives.

In connection with some of our non-homebuilding businesses, we are also considering other types of transactions such as sales, restructurings, joint ventures as we continue to move towards being a pure play homebuilding company.

In connection with some of our non-homebuilding businesses, we are also considering other types of transactions such as sales, restructurings, and joint ventures as we continue to move towards being a pure play homebuilding company.

On February 7, 2025, we successfully completed the taxable spin-off of Millrose from Lennar through a distribution of approximately 80% of Millrose's stock to our stockholders.

We will temporarily retain, but will not vote, the remaining 20% of the total outstanding shares of Millrose common stock, which we expect to dispose of through a subsequent spin-off, split-off, public offering, private sale or any combination of these potential transactions later in the year.

We temporarily retain, but do not vote, the remaining 20% of the total outstanding shares of Millrose common stock, which we expect to dispose of through a subsequent spin-off, split-off, public offering, private sale or any combination of these potential transactions later in the year.

In connection with the spin-off, we contributed to Millrose $5.6 billion in land assets and cash of $1.0 billion, which included $584 million of cash deposits related to option contracts.

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We acquired Rausch’s homebuilding operations while Millrose acquired Rausch's land assets and we have options on the land.

With this acquisition, we have expanded our footprint into new markets in Arkansas (Bentonville/Fayetteville, Little Rock and Jonesboro), Oklahoma (Tulsa and Stillwater), Alabama (Birmingham and Tuscaloosa), and Kansas/Missouri (Kansas City), while adding to its existing footprint in Texas (Houston and San Antonio), Oklahoma (Oklahoma City), Alabama (Huntsville) and Florida (Gulf Coast).

With this acquisition, we have expanded our footprint into new markets in Arkansas (Bentonville/Fayetteville, Little Rock and Jonesboro), Oklahoma (Tulsa and Stillwater), Alabama (Birmingham and Tuscaloosa), and Kansas/Missouri (Kansas City), while adding to our existing footprint in Texas (Houston and San Antonio), Oklahoma (Oklahoma City), Alabama (Huntsville) and Florida (Gulf Coast).

Our Homebuilding senior notes and other debt payable as well as letters of credit and surety bonds are summarized within Note 8 of the Notes to Condensed Consolidated Financial Statements.

Our Homebuilding average debt outstanding and the average rates of interest was as follows:

Three Months Ended

(Dollars in thousands) February 28, 2025 February 29, 2024

Six Months Ended May 31,

(Dollars in thousands) 2025 2024

Homebuilding average debt outstanding $ 2,528,378 2,640,040

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Interest incurred $ 73,335 70,275

In May 2025, we issued $700 million in aggregate principal amount of 5.20% senior notes due 2030 (the "5.20% senior notes") at a price of 99.969% of the principal amount.

Proceeds from the offering, after payment of expenses, totaled $695.6 million.

The 5.20% Senior Notes are unsecured and unsubordinated, but are guaranteed by substantially all of our 100% owned homebuilding subsidiaries.

Interest on the 5.20% Senior Notes is due semi-annually beginning January 30, 2026.

We utilized the net proceeds from the sale of the 5.20% senior notes primarily to pay off $500 million aggregate principal amount of our 4.75% senior notes due May 2025.

The redemption price, which was paid in cash, was 100% of the principal amount outstanding.

In May 2025, we entered into a new unsecured delayed draw term loan facility with an initial committed borrowing availability of approximately $1.6 billion (the “Delayed Draw Term Loan Facility”), which can be increased by an additional $500 million via an accordion feature.

The credit agreement governing our new unsecured Delayed Draw Term Loan Facility permits us to draw up to six times in the first 180 days after the effective date of the credit agreement or May 2028.

Once drawn, we may at any time prepay the loan, in whole or in part, without premium or penalty.

The term loan’s maturity date is three years from the initial effectiveness date of the credit agreement, and at our discretion, it can be extended for an additional year, subject to the satisfaction of certain conditions.

Under the Delayed Draw Term Loan Facility, interest rates equal the

adjusted term SOFR determined for the interest period plus the applicable margin.

As of May 31, 2025, there were no borrowings under the credit agreement governing the new unsecured Delayed Draw Term Loan Facility.

The maximum available borrowings on our Credit Facility were as follows:

(In thousands) February 28, 2025

(In thousands) At May 31, 2025

Commitments - maturing in May 2027 $ 225,000

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The proceeds available under the Credit Facility, which are subject to specified conditions for borrowing, may be used for working capital and general corporate purposes.

During the three months ended February 28, 2025, we received an additional $150 million in commitments.

In the first quarter of 2025, we received an additional $150 million in commitments.

The Credit Facility also provides that up to $477.5 million in commitments may be used for letters of credit.

The maturity, debt covenants and details of the Credit Facility are unchanged from the disclosure in our Financial Condition and Capital Resources section in our Annual Report on Form 10-K for the fiscal year ended November 30, 2024.

The maturity, debt covenants and details of the Credit Facility are unchanged from the disclosure in the Financial Condition and Capital Resources section in our 2024 Form 10-K.

In addition to the Credit Facility, we have other letter of credit facilities with different financial institutions.

Under the agreement governing our Credit Facility, we are required to maintain a minimum consolidated tangible net worth, a maximum leverage ratio and either a liquidity or an interest coverage ratio.

These ratios are calculated per the Credit Facility agreement, which involves adjustments to GAAP financial measures.

We believe we were in compliance with our debt covenants as of February 28, 2025.

The following summarizes our debt covenant requirements and our actual levels or ratios with respect to those covenants as calculated per the Credit Facility agreement as of February 28, 2025:

Under the agreements governing our Credit Facility and Delayed Draw Term Loan Facility, we are required to maintain a minimum consolidated tangible net worth, a maximum leverage ratio and either a liquidity or an interest coverage ratio.

These ratios are calculated per the Credit Facility and Delayed Draw Term Loan Facility agreements , which involve adjustments to GAAP financial measures.

We believe we were in compliance with our debt covenants as of May 31, 2025.

The following summarizes our debt covenant requirements and our actual levels or ratios with respect to those covenants as calculated per the Credit Facility and Delayed Draw Term Loan Facility agreements as of May 31, 2025:

(Dollars in thousands) Covenant Level Level Achieved as of

February 28, 2025

Minimum net worth test $ 10,000,000 16,545,782

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The repurchase authorization has no expiration date.

At February 28 2025, we have a remaining authorization to repurchase $2.7 billion in value of our Class A or B common stock.

The details of our Class A and Class B common stock repurchases under the authorized repurchase program for the three months ended February 28, 2025 and February 29, 2024 are included in Note 5 of the Notes to Condensed Consolidated Financial Statements.

During the three months ended February 28, 2025, treasury shares increased by 5.8 million shares primarily due to our repurchase of 5.2 million shares of Class A and Class B common stock through our stock repurchase program.

During the three months ended February 29, 2024, treasury shares increased by 3.6 million shares primarily due to our repurchase of 3.4 million shares of Class A and Class B common stock through our stock repurchase program.

On February 7, 2025, we distributed a stock dividend consisting of 120,980,401 shares of Millrose Class A common stock outstanding and 11,819,811 shares of Millrose Class B common stock outstanding (representing approximately 80% of the total outstanding shares of Millrose common stock) to each holder of Lennar Class A or Class B common stock as of the close of business on January 21, 2025, the record date of the Millrose spin-off.

On February 12, 2025, we paid a quarterly cash dividend of 0.50 per share for both our Class A and Class B common stock to holders of record at the close of business day January 29, 2025.

We approved and paid cash dividends of $0.50 per share for each of the four quarters of 2024 for both its Class A and Class B common stock.

At May 31, 2025, we have a remaining authorization to repurchase $2.2 billion in value of our Class A or Class B common stock.

The details of our Class A and Class B common stock repurchases under the authorized repurchase program for the six months ended May 31, 2025 and May 31, 2024 are included in Note 5 of the Notes to Condensed Consolidated Financial Statements.

During the six months ended May 31, 2025, treasury shares increased by 10.6 million shares primarily due to our repurchase of 9.9 million shares of Class A and Class B common stock through our stock repurchase program.

During the six months ended May 31, 2024, treasury shares increased by 7.8 million shares primarily due to our repurchase of 7.2 million shares of Class A and Class B common stock through our stock repurchase program.

On February 7, 2025, we distributed a stock dividend consisting of 120,980,401 shares of Millrose Class A common stock and 11,819,811 shares of Millrose Class B common stock (representing approximately 80% of the total outstanding shares of Millrose common stock) to the holders of Lennar Class A or Class B common stock as of the close of business on January 21, 2025, the record date of the Millrose spin-off.

On June 19, 2025, our Board of Directors declared a quarterly cash dividend of $0.50 per share on both our Class A and Class B common stock, payable on July 18, 2025 to holders of record at the close of business on July 3, 2025.

On May 7, 2025, we paid a quarterly cash dividend of 0.50 per share for both our Class A and Class B common stock to holders of record at the close of business day April 23, 2025.

We approved and paid cash dividends of $0.50 per share for each of the four quarters of 2024 for both our Class A and Class B common stock.

Based on our current financial condition and credit relationships, we believe that our operations and borrowing resources will provide for our current and long-term capital requirements at our anticipated levels of activity.

Supplemental Financial Information

Currently, certain of our 100% owned subsidiaries, which are primarily homebuilding subsidiaries, are guaranteeing all our senior notes.

The guarantees are full and unconditional.

The indentures governing our senior notes require that, if any of our 100% owned subsidiaries, other than our finance company subsidiaries and foreign subsidiaries, directly or indirectly guarantee at least $75 million principal amount of debt of Lennar Corporation (other than senior notes), those subsidiaries must also guarantee Lennar Corporation’s obligations with regard to its senior notes.

Included in the following tables as part of “Obligors” together with Lennar Corporation are subsidiary entities that are not finance company subsidiaries or foreign subsidiaries and were guaranteeing the senior notes because at February 28, 2025 they were guaranteeing Lennar Corporation's letter of credit facilities and its Credit Facility, disclosed in Note 8 of the Notes to Condensed Consolidated Financial Statements.

The guarantees are full, unconditional and joint and several and the guarantor subsidiaries are 100% directly or indirectly owned by Lennar Corporation.

A subsidiary's guarantee of Lennar senior notes will be suspended at any time when it is not directly or indirectly guaranteeing at least $75 million principal amount of debt of Lennar Corporation (other than senior notes), and a subsidiary will be released from its guarantee and any other obligations it may have regarding the senior notes if all or substantially all its assets, or all of its capital stock, are sold or otherwise disposed.

Supplemental information for the Obligors, which excludes non-guarantor subsidiaries and intercompany transactions, at February 28, 2025 is included in the following tables.

Our outstanding senior notes are guaranteed by certain of our wholly-owned subsidiaries, which are primarily homebuilding subsidiaries.

These guarantees are full and unconditional.

The guarantors of our senior notes are currently those subsidiaries that also guarantee Lennar Corporation's letter of credit facilities and its Credit Facility, which is disclosed in Note 8 of the Notes to Condensed Consolidated Financial Statements.

Under the indentures governing our senior notes, guarantees may be suspended or released under certain circumstances.

Supplemental information for the Obligors, which excludes non-guarantor subsidiaries and intercompany transactions, at May 31, 2025 is included in the following tables.

Intercompany balances and transactions within the Obligors have been eliminated and amounts attributable to the Obligors' investment in consolidated subsidiaries that have not issued or guaranteed the senior notes have been excluded.

Amounts due from and transactions with nonobligor subsidiaries and related parties are separately disclosed:

(In thousands) February 28, 2025 November 30, 2024

(In thousands) At May 31, 2025 At November 30, 2024

Due from non-guarantor subsidiaries $ 13,973,126 18,396,060

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Total liabilities 8,937,245 10,067,424

Three Months Ended

(In thousands) February 28, 2025

Six Months Ended

(In thousands) May 31, 2025

Total revenues $ 14,351,055

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For those joint ventures not in compliance with the debt covenants, we evaluate and assess possible impairment of our investments.

We believe that substantially all of the joint ventures were in compliance with applicable debt covenants at February 28, 2025.

We believe that substantially all of the joint ventures were in compliance with applicable debt covenants at May 31, 2025.

Homebuilding:

Investments in Unconsolidated Entities

As of February 28, 2025, we had equity investments in 53 active Homebuilding and land unconsolidated entities (of which 5 had recourse debt, 14 had non-recourse debt and 34 had no debt) and 51 active Homebuilding and land unconsolidated entities at November 30, 2024.

As of May 31, 2025, we had equity investments in 54 active Homebuilding and land unconsolidated entities (of which 4 had recourse debt, 14 had non-recourse debt and 36 had no debt) compared to 51 active Homebuilding and land unconsolidated entities at November 30, 2024.

Historically, we have invested in unconsolidated entities that acquired and developed land (1) for our homebuilding operations or for sale to third parties or (2) for the construction of homes for sale to third-party homebuyers.

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Details regarding these investments, balances and debt are included in Note 4 of the Notes to Condensed Consolidated Financial Statements.

The following table summarizes the principal maturities of our Homebuilding unconsolidated entities (“JVs”) debt as per current debt arrangements as of February 28, 2025.

The following table summarizes the principal maturities of our Homebuilding unconsolidated entities (“JVs”) debt as per current debt arrangements as of May 31, 2025.

It does not represent estimates of future cash payments that will be made to reduce debt balances.

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Investments in Unconsolidated Entities

At February 28, 2025, Multifamily had equity investments in 24 active unconsolidated entities that are engaged in multifamily residential developments (of which 17 had non-recourse debt and 7 had no debt) and 23 active unconsolidated entities at November 30, 2024.

At May 31, 2025, Multifamily had equity investments in 25 active unconsolidated entities that are engaged in multifamily residential developments (of which 17 had non-recourse debt and 8 had no debt) compared to 23 active unconsolidated entities at November 30, 2024.

We invest in unconsolidated entities that acquire and develop land to construct multifamily rental properties.

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Participants in these joint ventures have been financial partners.

Joint ventures with financial partners have allowed us to combine our development and construction expertise with access to our partners’

Joint ventures with financial partners have allowed us to combine our development and construction expertise with access to our partners’ capital.

Each joint venture is governed by an operating agreement that provides significant substantive participating voting rights on major decisions to our partners.

The Multifamily segment includes LMV I, LMV II and Canada Pension Plan Investments Fund, which are long-term multifamily development investment vehicles involved in the development, construction and property management of class-A multifamily assets.

Details of each fund as of and during the three months ended February 28, 2025 are included in Note 4 of the Notes to Condensed Consolidated Financial Statements.

The following table summarizes the principal maturities of our Multifamily unconsolidated entities debt as per current debt arrangements as of February 28, 2025.

The Multifamily segment includes LMV I, LMV II, the CPPIB Fund and the Institutional JV, which are long-term multifamily development investment vehicles involved in the development and construction of class-A multifamily assets.

Details of each fund as of and during the six months ended May 31, 2025 are included in Note 4 of the Notes to Condensed Consolidated Financial Statements.

The following table summarizes the principal maturities of our Multifamily unconsolidated entities debt as per current debt arrangements as of May 31, 2025.

It does not represent estimates of future cash payments that will be made to reduce debt balances.

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These distributions are not subject to clawbacks but reduce future carried interest payments to which we become entitled from the applicable funds and are recorded as equity in earnings (losses) in the condensed consolidated statement of operations.

Our investment in the Rialto funds totaled $136.6 million and $140.1 million as of February 28, 2025 and November 30, 2024, respectively.

As of February 28, 2025 and November 30, 2024, we had strategic technology investments in unconsolidated entities of $238.8 million and $239.3 million, respectively, accounted for under the equity method of accounting.

Our strategic technology investments through our LEN X business help to enhance the homebuying and homeownership experience, and help us stay at the forefront of homebuilding innovation.

Our investment in the Rialto funds totaled $132.9 million and $140.1 million as of May 31, 2025 and November 30, 2024, respectively.

As of May 31, 2025 and November 30, 2024, we had strategic technology investments in unconsolidated entities of $235.1 million and $239.3 million, respectively, accounted for under the equity method of accounting.

Our strategic technology investments through our LEN X business help to enhance the homebuying and homeownership experience, and are an important part of our focus on using technology to reduce costs.

Details regarding these investments are included in Note 4 of the Notes to Condensed Consolidated Financial Statements.

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The table below indicates the number of homesites to which we had access through option contracts with third parties and unconsolidated JVs (i.e., controlled homesites) and homesites owned (excluding homes in inventory):

February 28, 2025 Controlled Homesites Owned Homesites Total Homesites Supply Owned (1)

May 31, 2025 Controlled Homesites Owned Homesites Total Homesites Supply Owned (1)

East 113,568 1,017 114,585

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% of total homesites 98% 2%

February 29, 2024 Controlled Homesites Owned Homesites Total Homesites Supply Owned (1)

May 31, 2024 Controlled Homesites Owned Homesites Total Homesites Supply Owned (1)

East 86,067 17,180 103,247

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% of total homesites 79% 21%

(1) Based on trailing twelve months of home deliveries.

Details on option contracts and related consolidated inventory not owned and exposure are included in Note 10 of the Notes to Condensed Consolidated Financial Statements.

(1) Based on trailing twelve months of homes delivered.

Details on option contracts, transactions with land banks and Millrose and related consolidated inventory not owned and exposure are included in Note 10 of the Notes to Condensed Consolidated Financial Statements.

Contractual Obligations and Commercial Commitments

Our contractual obligations and commercial commitments have not changed materially from those reported in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended November 30, 2024, except for a decrease of $534 million in borrowings under the Financial Services' warehouse repurchase facilities and a decrease of $449 million in land purchase contract obligations.

Our contractual obligations and commercial commitments have not changed materially from those reported in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Form 10-K, except for a decrease of $515 million in borrowings under the Financial Services' warehouse repurchase facilities, a decrease of $449 million in land purchase contract obligations, and an increase of $540 million in Homebuilding senior notes and other debts payable, net.

(3) Recently Adopted Accounting Pronouncements

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(4) Critical Accounting Policies

There have been no significant changes to our critical accounting policies during the three months ended February 28, 2025 as compared to those we disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2024.

There have been no significant changes to our critical accounting policies during the six months ended May 31, 2025 as compared to those we disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2024 Form 10-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis