What changed in this filing

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Item 1. Financial Statements

2025-11-04 compared with 2025-08-05 · 129 added, 101 removed, 388 unchanged (37% of the section changed)

3 unchanged sentences

(In thousands, except share data)

June 30, December 31,

September 30, December 31,

Cash and cash equivalents $ 61,979 $ 53,197

13 unchanged sentences

COMMITMENTS AND CONTINGENCIES

Common stock, par value $ 0.01 , 250,000,000 shares authorized, 27,713,227 shares issued and 23,056,635 shares outstanding as of June 30, 2025 and 27,644,413 shares issued and 23,397,074 shares outstanding as of December 31, 2024

Common stock, par value $ 0.01 , 250,000,000 shares authorized, 27,735,692 shares issued and 23,079,100 shares outstanding as of September 30, 2025 and 27,644,413 shares issued and 23,397,074 shares outstanding as of December 31, 2024

Additional paid-in capital 347,714 337,161

Retained earnings 2,141,018 2,085,787

Treasury stock, at cost, 4,656,592 shares as of June 30, 2025 and 4,247,339 shares as of December 31, 2024

Treasury stock, at cost, 4,656,592 shares as of September 30, 2025 and 4,247,339 shares as of December 31, 2024

( 409,635 ) ( 385,996 )

5 unchanged sentences

(In thousands, except share and per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

28 unchanged sentences

Net income — — — 31,533 — 31,533

Stock repurchases including excise tax — — — — ( 20,588 ) ( 20,588 )

Stock repurchase — — — — ( 20,588 ) ( 20,588 )

Compensation expense for equity awards — — 2,826 — — 2,826

1 unchanged sentence

BALANCE— June 30, 2025 27,713,227 $ 277 $ 345,189 $ 2,121,314 $ ( 409,635 ) $ 2,057,145

Net income — — — 19,704 — 19,704

Compensation expense for equity awards — — 1,606 — — 1,606

Stock issued under employee incentive plans 22,465 — 919 — — 919

BALANCE— September 30, 2025 27,735,692 $ 277 $ 347,714 $ 2,141,018 $ ( 409,635 ) $ 2,079,374

See accompanying notes to the consolidated financial statements.

LGI HOMES, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(In thousands, except share data)

Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Total Equity

3 unchanged sentences

Restricted stock units granted for accrued annual bonuses — — 786 — — 786

Stock repurchases including excise tax — — — — ( 10,002 ) ( 10,002 )

Stock repurchase — — — — ( 10,002 ) ( 10,002 )

Compensation expense for equity awards — — 3,829 — — 3,829

2 unchanged sentences

Net income — — — 58,573 — 58,573

Stock repurchases including excise tax — — — — ( 7,998 ) ( 7,998 )

Stock repurchase — — — — ( 7,998 ) ( 7,998 )

Compensation expense for equity awards — — 2,841 — — 2,841

1 unchanged sentence

BALANCE—June 30, 2024 27,612,742 $ 276 $ 331,246 $ 1,965,342 $ ( 373,022 ) $ 1,923,842

Net income — — — 69,575 — 69,575

Compensation expense for equity awards — — 2,256 — — 2,256

Stock issued under employee incentive plans 13,208 — 1,290 — — 1,290

BALANCE—September 30, 2024 27,625,950 $ 276 $ 334,792 $ 2,034,917 $ ( 373,022 ) $ 1,996,963

See accompanying notes to the consolidated financial statements.

2 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

17 unchanged sentences

Purchases of property and equipment ( 924 ) ( 1,345 )

Proceeds from sale of property and equipment 10,155 —

Investment in unconsolidated entities ( 3,566 ) ( 5,296 )

26 unchanged sentences

Results for interim periods are not necessarily indicative of results to be expected for the full year.

The accompanying unaudited financial statements as of June 30, 2025, and for the three and six months ended June 30, 2025 and 2024, include the accounts of the Company and its subsidiaries.

The accompanying unaudited financial statements as of September 30, 2025, and for the three and nine months ended September 30, 2025 and 2024, include the accounts of the Company and its subsidiaries.

All intercompany balances and transactions have been eliminated in consolidation.

17 unchanged sentences

Our real estate inventory consists of the following (in thousands):

June 30, December 31,

September 30, December 31,

Land, land under development and finished lots $ 2,590,593 $ 2,287,352

7 unchanged sentences

We build and lease a number of single-family homes in select, existing communities.

During the six months ended June 30, 2025 and 2024, we transferred $ 41.4 million and $ 11.0 million, respectively, of home assets from real estate inventory to rental properties within property and equipment, net.

During the nine months ended September 30, 2025 and 2024, we transferred $ 58.3 million and $ 17.4 million, respectively, of home assets from real estate inventory to rental properties within property and equipment, net.

We are lessors of the homes representing these home assets.

1 unchanged sentence

Accrued and other liabilities consist of the following (in thousands):

June 30, December 31,

September 30, December 31,

Real estate inventory development and construction payable $ 58,306 $ 48,019

12 unchanged sentences

Principal payments on these financing arrangements will generally coincide with the repurchase of lot takedowns from the land banker.

We expect to complete the repurchase of all lots via takedowns associated with these transactions over the course of approximately one year .

We expect to complete the repurchase of all lots via takedowns associated with these transactions over the course of less than a year.

Inventory Related Obligations

5 unchanged sentences

Changes to our warranty accrual are as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

5 unchanged sentences

Revolving Credit Agreement

On April 28, 2025, we entered into a Sixth Amendment to Fifth Amended and Restated Credit Agreement with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent, and on June 2, 2025, we entered into a Letter Agreement with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent, in each case which amended the Fifth Amended and Restated Credit Agreement, dated as of April 28, 2021, with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent (as amended through June 2, 2025, the “June 2025 Credit Agreement”).

The June 2025 Credit Agreement provides for a $ 1.1825 billion revolving credit facility, which can be increased at the request of the Company by up to $ 95.0 million, subject to the terms and conditions of the June 2025 Credit Agreement.

The June 2025 Credit Agreement matures on April 28, 2029 with respect to $ 972.5 million, or 82.2 %, of the $ 1.1825 billion of commitments thereunder and on April 28, 2028 with respect to 17.8 % of the commitments thereunder.

Before each anniversary of the June 2025 Credit Agreement, we may request a one-year extension of its maturity date.

The June 2025 Credit Agreement is guaranteed by, among others, each of our subsidiaries that have gross assets of at least $ 0.5 million, other than subsidiaries whose sole purpose is to own and operate single-family rental homes.

The borrowings and letters of credit outstanding under the June 2025 Credit Agreement, together with the outstanding principal balance of our 8.750 % Senior Notes due 2028 (the “2028 Senior Notes”), our 4.000 % Senior Notes due 2029 (the “2029 Senior Notes”) and our 7.000 % Senior Notes due 2032 (the “2032 Senior Notes”), may not exceed the borrowing base under the June 2025 Credit Agreement.

The borrowing base primarily consists of a percentage of commercial land, land held for development, lots under development and finished lots held by the Company and its subsidiaries that guarantee the obligations under the June 2025 Credit Agreement.

As of June 30, 2025, the borrowing base under the June 2025 Credit Agreement was $ 2.1 billion, of which the maximum available to borrow was $ 2.0 billion.

As of June 30, 2025, borrowings under the June 2025 Credit Agreement and the outstanding principal amount of the 2028 Senior Notes, the 2029 Senior Notes and the 2032 Senior Notes totaled approximately $ 1.8 billion, $ 27.4 million of letters of credit were outstanding and $ 263.0 million was available to borrow under the June 2025 Credit Agreement.

Borrowings under the June 2025 Credit Agreement bear interest, payable monthly in arrears, at the Company’s option, at either (1) the Adjusted Term SOFR (defined as a term SOFR that is based on a fixed 1, 3 or 6 month interest period, as selected by the Company, plus a 10 , 15 or 25 basis point adjustment, respectively), which rate is subject to a 50 basis point floor, plus an applicable margin ranging from 145 basis points to 210 basis points (the “Applicable Margin”) based on the Company’s leverage ratio as determined in accordance with a pricing grid, or (2) the Base Rate (defined as a term SOFR that is based on a daily variable 1 month interest period plus a 10 basis point adjustment), subject to a 50 basis point floor, plus the Applicable Margin.

At June 30, 2025, the Applicable Margin was 1.85 %, and SOFR was 4.33 %, subject to the 0.50 % SOFR floor as included in the June 2025 Credit Agreement.

The June 2025 Credit Agreement contains various financial covenants, including a minimum tangible net worth, a maximum leverage ratio, a minimum liquidity amount and a minimum EBITDA to interest expense ratio.

The June 2025 Credit Agreement contains various covenants that, among other restrictions, limit the amount of our additional debt and our ability to make certain investments.

At June 30, 2025, we were in compliance with all of the covenants contained in the June 2025 Credit Agreement.

On August 1, 2025, we entered into a Letter Agreement with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent (the “Letter Agreement Amendment”), which amended the June 2025 Credit Agreement (as so amended by the Letter Agreement Amendment, the “Credit Agreement”).

The Letter Agreement Amendment, among other things, amended (i) the borrowing base by removing model housing units from the borrowing base sublimit, (ii) the financial covenants to (a) decrease the minimum EBITDA to interest expense ratio through December 31, 2026, (b) increase the minimum liquidity amount, (c) decrease the maximum leverage ratio through December 31, 2026 and (d) delete the covenant related to limitations on wholesale sales contracts, (iii) the permitted secured debt basket by increasing the available capacity thereunder and (iv) the restricted payment covenant to restrict the repurchase of shares and payment of dividends

through December 31, 2026, subject to the terms and conditions set forth therein.

The Credit Agreement otherwise has substantially similar terms and provisions to the June 2025 Credit Agreement.

On August 1, 2025, we entered into a Letter Agreement with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent (the “Letter Agreement Amendment”), which amended the Fifth Amended and Restated Credit Agreement, dated as of April 28, 2021, with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent (as amended to date, including the Letter Agreement Amendment, the “Credit Agreement”).

The Credit Agreement provides for a $ 1.1825 billion revolving credit facility, which can be increased at the request of the Company by up to $ 95.0 million, subject to the terms and conditions of the Credit Agreement.

The Credit Agreement matures on April 28, 2029 with respect to $ 972.5 million, or 82.2 %, of the $ 1.1825 billion of commitments thereunder and on April 28, 2028 with respect to 17.8 % of the commitments thereunder.

Before each anniversary of the Credit Agreement, we may request a one-year extension of its maturity date.

The Credit Agreement is guaranteed by, among others, each of our subsidiaries that have gross assets of at least $ 0.5 million, other than subsidiaries whose sole purpose is to own and operate single-family rental homes.

The borrowings and letters of credit outstanding under the Credit Agreement, together with the outstanding principal balance of our 8.750 % Senior Notes due 2028 (the “2028 Senior Notes”), our 4.000 % Senior Notes due 2029 (the “2029 Senior Notes”) and our 7.000 % Senior Notes due 2032 (the “2032 Senior Notes”), may not exceed the borrowing base under the Credit Agreement.

As of September 30, 2025, the borrowing base under the Credit Agreement was $ 2.1 billion, of which the maximum available to borrow was $ 2.1 billion.

As of September 30, 2025, borrowings under the Credit Agreement and the outstanding principal amount of the 2028 Senior Notes, the 2029 Senior Notes and the 2032 Senior Notes totaled approximately $ 1.7 billion, $ 27.0 million of letters of credit were outstanding and $ 367.9 million was available to borrow under the Credit Agreement.

Borrowings under the Credit Agreement bear interest, payable monthly in arrears, at the Company’s option, at either (1) the Adjusted Term SOFR (defined as a term SOFR that is based on a fixed 1, 3 or 6 month interest period, as selected by the Company, plus a 10 , 15 or 25 basis point adjustment, respectively), which rate is subject to a 50 basis point floor, plus an applicable margin ranging from 145 basis points to 210 basis points (the “Applicable Margin”) based on the Company’s leverage ratio as determined in accordance with a pricing grid, or (2) the Base Rate (defined as a term SOFR that is based on a daily variable 1 month interest period plus a 10 basis point adjustment), subject to a 50 basis point floor, plus the Applicable Margin.

At September 30, 2025, the Applicable Margin was 1.95 %, and SOFR was 4.16 %, subject to the 0.50 % SOFR floor as included in the Credit Agreement.

The Credit Agreement contains various financial covenants, including a minimum tangible net worth, a maximum leverage ratio, a minimum liquidity amount and a minimum EBITDA to interest expense ratio.

The Credit Agreement contains various covenants that, among other restrictions, limit the amount of our additional debt and our ability to make certain investments.

At September 30, 2025, we were in compliance with all of the covenants contained in the Credit Agreement.

LGI Living Loan Agreement

On July 23, 2025, the Company’s indirect, wholly owned special purpose subsidiary LGI Living - SFR 1, LLC (“LGI Living SFR”) entered into a Loan Agreement (the “Loan Agreement”) with Evergreen Residential Capital, LLC, as lender.

Loan Agreement provides for a secured non-recourse loan for up to $ 50.0 million, which can be increased at the request of LGI Living SFR by up to $ 75.0 million (for a total of $ 125.0 million), subject to the terms and conditions of the Loan Agreement.

As of September 30, 2025, the total amount of borrowings outstanding under the Loan Agreement was $ 50.0 million.

The loan matures on July 8, 2030 and bears interest at a rate of 6.433 % per annum, which may be adjusted in connection with an increase in the amount of the loan.

The loan is unconditionally guaranteed as to payment and performance by the Company under a limited recourse guaranty with respect to (i) certain losses and liabilities to the extent such losses or liabilities are actually incurred by the lender and (ii) the entire amount of the loan upon the occurrence of certain events.

The Loan Agreement requires that the Company maintain, as guarantor, (i) liquidity of not less than 15 % of the loan amount and (ii) maintain net worth in excess of 50 % of the loan amount.

The loan is unconditionally guaranteed as to payment and performance by LGI Living - ER FIN, LLC, as the direct owner of the equity interests in LGI Living SFR, but recourse under such guaranty is limited to LGI Living - ER FIN, LLC’s equity interests in LGI Living SFR, which are pledged as collateral for the loan.

The loan is also secured by a security interest in all assets of LGI Living SFR, including a mortgage lien on certain of LGI Living SFR’s real property.

The Loan Agreement includes certain restrictive covenants that may limit LGI Living SFR’s ability to, among other things, incur additional indebtedness or make certain investments.

The Loan Agreement contains representations and warranties, affirmative covenants, and events of default, all of which the Company believes are customary for special purpose subsidiary real estate secured loan agreements.

If an event of default exists under the Loan Agreement, the lender will be able to accelerate the maturity of the loan and exercise other rights and remedies.

At September 30, 2025, we were in compliance with all of the covenants contained in the Loan Agreement.

Senior Notes Offering

15 unchanged sentences

Notes payable consist of the following (in thousands):

June 30, 2025 December 31, 2024

Notes payable under the Credit Agreement ($ 1.1825 billion revolving credit facility at June 30, 2025, maturing in part on April 28, 2028 and in part on April 28, 2029, with interest paid monthly at SOFR plus 1.85 %;

September 30, 2025 December 31, 2024

Notes payable under the Credit Agreement ($ 1.1825 billion revolving credit facility at September 30, 2025, maturing in part on April 28, 2028 and in part on April 28, 2029, with interest paid monthly at SOFR plus 1.95 %;

$ 1.205 billion revolving credit facility at December 31, 2024, maturing in part on April 28, 2025 and in part on April 28, 2028, with interest paid monthly at SOFR plus 1.85 %)

9 unchanged sentences

400,000 400,000

Loan payable under the Loan Agreement maturing on July 8, 2030;

interest paid monthly at 6.44 %

Net debt issuance costs ( 22,163 ) ( 21,228 )

2 unchanged sentences

Interest activity, including other financing costs, for notes payable and financing arrangements for the periods presented is as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

3 unchanged sentences

Cash paid for interest $ 19,344 $ 23,110 $ 77,770 $ 79,925

Included in interest incurred was amortization of deferred financing costs and applicable discounts for notes payable and financing arrangements of $ 2.7 million and $ 4.4 million for the three months ended June 30, 2025 and 2024, respectively, and $ 5.4 million and $ 10.0 million for the six months ended June 30, 2025 and 2024, respectively.

Included in interest incurred was amortization of deferred financing costs and applicable discounts for notes payable and financing arrangements of $ 2.4 million and $ 3.1 million for the three months ended September 30, 2025 and 2024, respectively, and $ 7.8 million and $ 11.5 million for the nine months ended September 30, 2025 and 2024, respectively.

and state income tax returns in jurisdictions with varying statutes of limitations.

4 unchanged sentences

however, audit outcomes and the timing of audit adjustments are subject to significant uncertainty.

For the three months ended June 30, 2025, our effective tax rate of 25.0 % is higher than the Federal statutory rate primarily as a result of an increase in the rate for state income taxes, net of the federal benefit, and the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended.

For the six months ended June 30, 2025, our effective tax rate of 25.6 % is higher than the Federal statutory rate primarily as a result of an increase in the rate for state income taxes, net of the federal benefit, the compensation cost in excess of deductions for share-based payments, and the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended.

Income taxes paid were $ 21.3 million and $ 16.2 million for the three months ended June 30, 2025 and 2024, respectively.

Income taxes paid were $ 59.9 million and $ 28.3 million for the six months ended June 30, 2025 and 2024, respectively.

On July 4, 2025, President Trump signed into law the legislation commonly referred to as the One Big Beautiful Bill Act (“OBBBA”), which includes a broad range of tax reform provisions affecting corporations.

The OBBBA, among other changes, terminates the energy efficient homes tax credit for homes closing after June 30, 2026.

However, none of these tax law changes are expected to have an impact on the consolidated financial statements beginning in the period in which the OBBBA was signed into law.

For the three months ended September 30, 2025, our effective tax rate of 26.2 % is higher than the Federal statutory rate primarily as a result of an increase in the rate for state income taxes, net of the federal benefit, and the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended.

For the nine months ended September 30, 2025, our effective tax rate of 25.8 % is higher than the Federal statutory rate primarily as a result of an increase in the rate for state income taxes, net of the federal benefit, the compensation cost in excess of deductions for share-based payments, and the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended.

Income taxes paid were $ 2.4 million and $ 5.2 million for the three months ended September 30, 2025 and 2024, respectively.

Income taxes paid were $ 62.3 million and $ 33.5 million for the nine months ended September 30, 2025 and 2024, respectively.

Stock Repurchase Program

In February 2022, our Board of Directors (the “Board”) approved a $ 200.0 million increase to our previously authorized stock repurchase program, pursuant to which we may purchase up to $ 550.0 million of shares of our common stock through open market transactions, privately negotiated transactions or otherwise in accordance with applicable laws.

During the three and six months ended June 30, 2025, we repurchased 367,568 shares of our common stock at a total cost, including commissions and excise taxes, of $ 20.6 million and 409,253 shares of our common stock at a total cost, including commissions and excise taxes, of $ 23.6 million, respectively, to be held as treasury stock.

During the three and six months ended June 30, 2024, we repurchased 83,763 shares of our common stock at a total cost, including commissions and excise taxes, of $ 8.0 million and 172,990 shares of our common stock at a total cost, including commissions and excise taxes, of $ 18.0 million, respectively, to be held as treasury stock.

During the three months ended September 30, 2025, we did not repurchase any shares of our common stock.

During the nine months ended September 30, 2025, we repurchased 409,253 shares of our common stock at a total cost, including commissions and excise taxes, of $ 23.6 million, to be held as treasury stock.

During the three months ended September 30, 2024, we did not repurchase any shares of our common stock.

During the nine months ended September 30, 2024, we repurchased 172,990 shares of our common stock at a total cost, including commissions and excise taxes, of $ 18.0 million, to be held as treasury stock.

A total of 3,656,592 shares of our common stock has been repurchased since our stock repurchase program commenced in 2022.

As of June 30, 2025, we may purchase up to $ 157.3 million of shares of our common stock under our stock repurchase program.

As of September 30, 2025, we may purchase up to $ 157.3 million of shares of our common stock under our stock repurchase program.

EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended June 30, 2025 and 2024:

Three Months Ended June 30, Six Months Ended June 30,

The following table sets forth the computation of basic and diluted earnings per share for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Numerator (in thousands):

Net income (Numerator for basic and dilutive earnings per share) $ 31,533 $ 58,573 $ 35,527 $ 75,626

Net income (Numerator for basic and diluted earnings per share) $ 19,704 $ 69,575 $ 55,231 $ 145,201

Basic weighted average shares outstanding 23,056,904 23,500,349 23,223,736 23,540,620

4 unchanged sentences

Diluted earnings per share $ 0.85 $ 2.95 $ 2.37 $ 6.15

Antidilutive non-vested restricted stock units excluded from calculation of diluted earnings per share

39,700 3,399 16,340 16,972

Antidilutive non-vested restricted stock units excluded from calculations of diluted earnings per share 18,563 3,069 37,143 10,025

STOCK-BASED COMPENSATION

Non-performance Based Restricted Stock Units

The following table summarizes the activity of our time-vested restricted stock units (“RSUs”) for the six months ended June 30, 2025:

Six Months Ended June 30,

The following table summarizes the activity of our time-vested restricted stock units (“RSUs”) for the nine months ended September 30, 2025:

Nine Months Ended September 30,

Shares Weighted Average Grant Date Fair Value

4 unchanged sentences

Ending balance 245,632 $ 92.24

We recognized $ 1.8 million and $ 1.4 million of stock-based compensation expense related to outstanding RSUs for the three months ended June 30, 2025 and 2024, respectively.

We recognized $ 3.5 million and $ 2.8 million of stock-based compensation expense related to outstanding RSUs for the six months ended June 30, 2025 and 2024, respectively.

We recognized $ 1.8 million and $ 1.3 million of stock-based compensation expense related to outstanding RSUs for the three months ended September 30, 2025 and 2024, respectively.

We recognized $ 5.3 million and $ 4.1 million of stock-based compensation expense related to outstanding RSUs for the nine months ended September 30, 2025 and 2024, respectively.

Generally, the RSUs cliff vest on the third anniversary of the grant date and can only be settled in shares of our common stock.

At June 30, 2025, we had unrecognized compensation cost of $ 12.3 million related to unvested RSUs, which is expected to be recognized over a weighted average period of 2.1 years.

At September 30, 2025, we had unrecognized compensation cost of $ 10.4 million related to unvested RSUs, which is expected to be recognized over a weighted average period of 2.0 years.

Performance-Based Restricted Stock Units

2 unchanged sentences

The PSUs provide for shares of our common stock to be issued based on the attainment of certain performance metrics over the applicable three-year periods.

The number of shares of our common stock that may be issued to the recipients for the PSUs range from 0 % to 200 % of the target amount depending on actual results as compared to the target

performance metrics.

The number of shares of our common stock that may be issued to the recipients for the PSUs range from 0 % to 200 % of the target amount depending on actual results as compared to the target performance metrics.

The terms of the PSUs provide that the payouts will be capped at 100 % of the target number of PSUs granted if absolute total stockholder return is negative during the performance period, regardless of EPS performance;

3 unchanged sentences

The PSUs can only be settled in shares of our common stock.

The following table summarizes the activity of our PSUs for the six months ended June 30, 2025:

Six Months Ended June 30,

Target Shares

Weighted Average Grant Date Fair Value

The following table summarizes the activity of our PSUs for the nine months ended September 30, 2025:

Nine Months Ended September 30,

Target Shares Weighted Average Grant Date Fair Value

Beginning balance 196,770 $ 111.38

2 unchanged sentences

Ending balance 252,725 $ 92.92

At June 30, 2025, management estimates that the recipients will receive approximately 77.9 % of the weighted average target number of PSUs outstanding at the end of the applicable three-year performance cycle based on projected performance compared to the target performance metrics.

At September 30, 2025, management estimates that the recipients will receive approximately 59.9 % of the weighted average target number of PSUs outstanding at the end of the applicable three-year performance cycle based on projected performance compared to the target performance metrics.

PSUs granted in 2022 were forfeited based on actual results as compared to the target performance metrics.

We recognized $ 0.9 million and $ 1.2 million of total stock-based compensation expense related to outstanding PSUs for the three months ended June 30, 2025 and 2024, respectively.

We recognized $ 1.5 million and $ 3.2 million of total stock-based compensation expense related to outstanding PSUs for the six months ended June 30, 2025 and 2024, respectively.

At June 30, 2025, we had unrecognized compensation cost of $ 11.4 million, based on the probable amount, related to unvested PSUs, which is expected to be recognized over a weighted average period of 2.3 years.

We recognized $( 0.4 ) million and $ 0.8 million of total stock-based compensation

expense related to outstanding PSUs for the three months ended September 30, 2025 and 2024, respectively.

We recognized $ 1.2 million and $ 4.0 million of total stock-based compensation expense related to outstanding PSUs for the nine months ended September 30, 2025 and 2024, respectively.

At September 30, 2025, we had unrecognized compensation cost of $ 7.5 million, based on the probable amount, related to unvested PSUs, which is expected to be recognized over a weighted average period of 2.0 years.

PSUs granted in 2024 and 2025 are excluded from the calculation of diluted EPS as they are subject to unsatisfied performance conditions.

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Fair value measurements may also be utilized on a nonrecurring basis, such as for the impairment of long-lived assets.

The fair value of financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and

certain accrued liabilities, approximate their carrying amounts due to the short-term nature of these instruments.

As of June 30, 2025, the June 2025 Credit Agreement’s carrying value approximates market value since it has a floating interest rate, which increases or decreases with market interest rates and our leverage ratio.

In order to determine the fair value of each of the 2028 Senior Notes, the 2029 Senior Notes and the 2032 Senior Notes, the future contractual cash flows are discounted at our estimate of current market rates of interest, which were determined based upon the average interest rates of similar senior notes within the homebuilding industry (Level 2 measurement).

The following table below shows the level and measurement of liabilities at June 30, 2025 and December 31, 2024 (in thousands):

June 30, 2025 December 31, 2024

The fair value of financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and certain accrued liabilities, approximate their carrying amounts due to the short-term nature of these instruments.

As of September 30, 2025, the Credit Agreement’s carrying value approximates market value since it has a floating interest rate, which increases or decreases with market interest rates and our leverage ratio.

In order to determine the fair value of each of the 2028 Senior Notes, the 2029 Senior Notes, the 2032 Senior Notes and the Loan Agreement, the future contractual cash flows are discounted at our estimate of current market rates of interest, which were determined based upon the average interest rates of similar senior notes within the homebuilding industry (Level 2 measurement).

The following table below shows the level and measurement of liabilities at September 30, 2025 and December 31, 2024 (in thousands):

September 30, 2025 December 31, 2024

Fair Value Hierarchy Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value

5 unchanged sentences

Level 2 $ 400,000 $ 436,416 $ 400,000 $ 421,247

(1) See Note 4 for more details regarding the offerings of the 2028 Senior Notes, the 2029 Senior Notes and the 2032 Senior Notes.

Loan Agreement (1)

Level 2 $ 50,000 $ 52,120 $ — $ —

(1) See Note 4 for more details regarding the offerings of the 2028 Senior Notes , the 2029 Senior Notes and the 2032 Senior Notes and the Loan Agreement .

COMMITMENTS AND CONTINGENCIES

10 unchanged sentences

In the opinion of management, these matters will not have a material effect on our consolidated financial position, results of operations or cash flows.

LGI Living Loan Agreement

On July 23, 2025, the Company’s indirect, wholly owned special purpose subsidiary LGI Living SFR entered into the Loan Agreement with Evergreen Residential Capital, LLC, as lender.

The loan under the Loan Agreement is unconditionally guaranteed as to payment and performance by the Company under a limited recourse guaranty with respect to (i) certain losses and liabilities to the extent such losses or liabilities are actually incurred by the lender and (ii) the entire amount of the loan upon the occurrence of certain events.

The Loan Agreement requires that the Company, as guarantor, maintain (i) liquidity of not less than 15 % of the loan amount and (ii) maintain net worth in excess of 50 % of the loan amount.

The loan under the Loan Agreement is secured by certain of LGI Living SFR’s single-family rental properties.

The Loan Agreement provides for a secured non-recourse loan for up to $ 50.0 million, which can be increased at the request of LGI Living SFR by up to $ 75.0 million (for a total of $ 125.0 million), subject to the terms and conditions of the Loan Agreement.

As of September 30, 2025, LGI Living SFR had $ 50.0 million of borrowings outstanding under the Loan Agreement.

Land Deposits

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The following is a summary of our land purchase deposits included in pre-acquisition costs and deposits (in thousands, except for lot count):

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Land deposits and option payments (1)

$ 19,221 $ 29,040

Commitments under the land purchase contracts if the purchases are consummated (1)

$ 433,421 $ 653,861

Lots under land purchase contracts (1)

Commitments under the land purchase option and deposit contracts if the (1) purchases are consummated

$ 339,425 $ 653,861

Lots under land options and land purchase contracts (1)

(1) Includes land banking financing arrangements, see Note 2 and Note 3 for more details regarding real estate not owned.

As of June 30, 2025 and December 31, 2024, approximately $ 7.3 million and $ 10.4 million, respectively, of the land deposits are related to purchase contracts to deliver finished lots that are refundable under certain circumstances, such as feasibility or specific performance, and secured by mortgages or letters of credit or guaranteed by the seller or its affiliates.

As of September 30, 2025 and December 31, 2024, approximately $ 7.0 million and $ 10.4 million, respectively, of the land deposits are related to purchase contracts to deliver finished lots that are refundable under certain circumstances, such as feasibility or specific performance, and secured by mortgages or letters of credit or guaranteed by the seller or its affiliates.

Lease Obligations

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We have non-cancelable operating leases primarily associated with our corporate and regional office facilities.

Operating lease expense is

recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms.

Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms.

Variable lease costs such as common area costs and property taxes are expensed as incurred.

2 unchanged sentences

As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

ROU assets, as included in other assets on the consolidated balance sheets, were $ 5.2 million and $ 5.6 million as of June 30, 2025 and December 31, 2024, respectively.

Lease obligations, as included in accrued expenses and other liabilities on the consolidated balance sheets, were $ 5.7 million and $ 6.1 million as of June 30, 2025 and December 31, 2024, respectively.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 0.5 million and $ 0.6 million for the three months ended June 30, 2025 and 2024, respectively.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 1.0 million and $ 1.2 million for the six months ended June 30, 2025 and 2024, respectively.

Cash paid for amounts included in the measurement of lease liabilities for operating leases was $ 0.6 million and $ 0.9 million for the six months ended June 30, 2025 and 2024, respectively.

As of June 30, 2025, the weighted-average discount rate was 6.0 % and our weighted-average remaining life was 2.0 years.

We do not have any significant lease contracts that have not yet commenced at June 30, 2025.

The table below shows the future minimum payments under non-cancelable operating leases at June 30, 2025 (in thousands):

ROU assets, as included in other assets on the consolidated balance sheets, were $ 5.1 million and $ 5.6 million as of September 30, 2025 and December 31, 2024, respectively.

Lease obligations, as included in accrued expenses and other

liabilities on the consolidated balance sheets, were $ 5.6 million and $ 6.1 million as of September 30, 2025 and December 31, 2024, respectively.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 1.5 million and $ 1.8 million for the nine months ended September 30, 2025 and 2024, respectively.

Cash paid for amounts included in the measurement of lease liabilities for operating leases was $ 0.7 million and $ 1.4 million for the nine months ended September 30, 2025 and 2024, respectively.

As of September 30, 2025, the weighted-average discount rate was 5.9 % and our weighted-average remaining life was 2.0 years.

We do not have any significant lease contracts that have not yet commenced at September 30, 2025.

The table below shows the future minimum payments under non-cancelable operating leases at September 30, 2025 (in thousands):

Year Ending December 31, Operating leases

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Bonding and Letters of Credit

We have outstanding letters of credit and performance and surety bonds totaling $ 431.4 million (including $ 27.4 million of letters of credit issued under the June 2025 Credit Agreement) and $ 377.5 million (including $ 24.5 million of letters of credit issued under the credit agreement then in effect) at June 30, 2025 and December 31, 2024, respectively, related to our obligations for site improvements at various projects.

We have outstanding letters of credit and performance and surety bonds totaling $ 423.1 million (including $ 27.0 million of letters of credit issued under the Credit Agreement) and $ 377.5 million (including $ 24.5 million of letters of credit issued under the credit agreement then in effect) at September 30, 2025 and December 31, 2024, respectively, related to our obligations for site improvements at various projects.

Management does not believe that draws upon the letters of credit, surety bonds or financial guarantees if any, will have a material effect on our consolidated financial position, results of operations or cash flows.

Investment in Unconsolidated Entities

As of June 30, 2025, we had two equity-method real estate joint ventures and four additional joint ventures engaged primarily to provide services, such as mortgage and insurance, to our homebuyers.

As of June 30, 2025 and December 31, 2024, we have a total of $ 23.5 million and $ 28.3 million, respectively, within other assets on the balance sheet relating to our investment in joint ventures associated with our operations.

As of September 30, 2025, we had two equity-method real estate joint ventures and four additional joint ventures engaged primarily to provide services, such as mortgage and insurance, to our homebuyers.

As of September 30, 2025 and December 31, 2024, we have a total of $ 21.1 million and $ 28.3 million, respectively, within other assets on the balance sheet relating to our investment in joint ventures associated with our operations.

Contributions into the unconsolidated entities are for the use of investing in certain real estate transactions and residential mortgage services, respectively.

Income associated with our investment in unconsolidated entities during the three and six months ended June 30, 2025 was $ 1.0 million and $ 1.9 million, respectively.

Income associated with our investment in unconsolidated entities during the three and six months ended June 30, 2024 was $ 3.0 million and $ 5.0 million, respectively.

Income associated with our investment in unconsolidated entities during the three and nine months ended September 30, 2025 was $( 0.03 ) million and $ 1.9 million, respectively.

Income associated with our investment in unconsolidated entities during the three and nine months ended September 30, 2024 was $ 4.6 million and $ 9.6 million, respectively.

Home Sales Revenues

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The following table presents our home sales revenues disaggregated by revenue stream (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

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We operate one principal homebuilding business that is organized and reports by division.

We have seven operating segments (our Central, Midwest, Southeast, Mid-Atlantic, Northwest, West and Florida divisions) that we aggregate into five qualifying reportable segments at June 30, 2025:

We have seven operating segments (our Central, Midwest, Southeast, Mid-Atlantic, Northwest, West and Florida divisions) that we aggregate into five qualifying reportable segments at September 30, 2025:

our Central, Southeast, Northwest, West, and Florida divisions.

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The CODMs primarily evaluate the segments’ operating performance and allocate resources for all of our reportable segments based on net income before income taxes.

For all of the segments, the CODMs use segment income before income tax expense in the annual budget and forecasting process.

These operating results are reviewed against actual and forecasted figures, with income before income taxes being the key operating metric used to measure profit or loss.

For all of the segments, the CODMs use segment net income before income tax expense in the annual budget and forecasting process.

These operating results are reviewed against actual and forecasted figures, with net income before income taxes being the key operating metric used to measure profit or loss.

Financial information relating to our reportable segments was as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

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Florida ( 1,101 ) 9,591 ( 1,632 ) 19,266

( 57 ) ( 764 ) ( 586 ) ( 1,100 )

Corporate ( 985 ) 367 ( 1,571 ) $ ( 733 )

Total net income before income taxes $ 26,701 $ 91,852 $ 74,465 $ 191,829

1 unchanged sentence

(2) The Corporate balance consists of general and administrative unallocated costs for various shared service functions and non-strategic other income.

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Central $ 1,194,037 $ 1,096,500

6 unchanged sentences

Total assets $ 4,039,831 $ 3,758,534

(1) The Corporate balance consists primarily of cash and investments in unconsolidated entities.

(1) The Corporate balance consists primarily of investments in unconsolidated entities.

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 1. Financial Statements