What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-02-13 compared with 2025-02-14 · 132 added, 115 removed, 1141 unchanged (18% of the section changed)

54 unchanged sentences

Land and housing $ 3,352,913 $ 3,305,781 $ 3,014,573

Impairment of inventory and land deposit write-offs

General and administrative 262,766 258,422 222,765

26 unchanged sentences

Deferred income tax asset

13,451 16,094

Goodwill 16,400 16,400

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Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Impairment of inventory and investment in joint venture arrangements 9,244 10,608 18,352

Impairment of inventory and land deposit write-offs

Equity in income from joint venture arrangements — — ( 33 )

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Amortization of mortgage servicing rights 1,146 1,314 1,578

(Gain) loss on sale of mortgage servicing rights

Gain on sale of mortgage servicing rights

( 1,718 ) ( 2,613 ) ( 936 )

6 unchanged sentences

( 2,333 ) ( 5,299 ) ( 6,457 )

— 9,244 10,608

Change in assets and liabilities:

14 unchanged sentences

FINANCING ACTIVITIES:

Proceeds from bank borrowings - homebuilding operations — — 362,000

Repayments of bank borrowings - homebuilding operations — — ( 362,000 )

Net proceeds from (Net repayments of) bank borrowings - financial services operations

( 9,303 ) 120,315 ( 79,897 )

(Principal repayments of) proceeds from notes payable-other and community development

district bond obligations — — ( 4,549 )

Repurchase of common shares ( 202,033 ) ( 176,953 ) ( 65,344 )

3 unchanged sentences

( 209,990 ) ( 36,074 ) ( 112,237 )

Net increase in cash, cash equivalents and restricted cash

Net (decrease) increase in cash, cash equivalents and restricted cash

( 132,381 ) 88,766 421,262

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Reclassifications.

Certain amounts in our Consolidated Financial Statements for years ended December 31, 2022 and 2023 were adjusted to conform to our 2024 presentation.

Certain amounts in our Consolidated Financial Statements for the year ended December 31, 2023 were adjusted to conform to our 2024 and 2025 presentation.

The Company believes these reclassifications are immaterial.

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Restricted cash consists of cash held in escrow.

Cash, Cash Equivalents and Restricted Cash includes restricted cash balances of $ 0.1 million and $ 0.2 million at December 31, 2024 and 2023, respectively.

Cash, Cash Equivalents and Restricted Cash includes restricted cash balances of $ 0.1 million at December 31, 2024.

Mortgage Loans Held for Sale.

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(In thousands) 2025 2024

Development reimbursement receivable from local municipalities $ 61,096 $ 66,406

Development reimbursement receivable from local municipalities (a)

$ 47,788 $ 61,096

Mortgage servicing rights 10,435 9,909

Prepaid expenses 20,501 19,130

Prepaid expenses (b)

38,883 20,501

Prepaid acquisition costs 12,446 13,744

1 unchanged sentence

Total other assets $ 178,370 $ 169,231

(a) The increase of Other in 2024 compared to prior year is due to certain receivables not being collected prior to year end.

(a) The decrease is due to an increase in reimbursements collected for 2025 compared to 2024 and a decrease in receivable recorded due to development activity and third party lot sales.

(b) The increase in prepaid expenses is primarily due to increase in prepaid income taxes.

Warranty Reserves.

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Our warranty reserves for our transferable structural warranty programs are established on a per-unit basis.

While the structural warranty reserve is recorded as each house is delivered, the sufficiency of the structural warranty per unit charge and total reserve is re-evaluated on an annual basis, with the assistance of an actuary, using our own historical data and trends, industry-

wide historical data and trends, and other project specific factors.

While the structural warranty reserve is recorded as each house is delivered, the sufficiency of the structural warranty per unit charge and total

reserve is re-evaluated on an annual basis, with the assistance of an actuary, using our own historical data and trends, industry-wide historical data and trends, and other project specific factors.

The reserves are also evaluated quarterly and adjusted if we encounter activity that is inconsistent with the historical experience used in the annual analysis.

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All of our home purchase contracts have a single performance obligation as the promise to transfer the home is not separately identifiable from other promises in the contract and, therefore, not distinct.

Our primary performance obligation, to deliver the agreed-upon home, is generally satisfied in less than one year from the original contract date.

Our primary performance

obligation, to deliver the agreed-upon home, is generally satisfied in less than one year from the original contract date.

Deferred revenue resulting from uncompleted performance obligations existing at the time we deliver new homes to our homebuyers is not material.

16 unchanged sentences

Total revenue $ 4,417,781 $ 4,504,670 $ 4,033,502

(a) Revenues include hedging losses of $ 2.6 million for the year ended December 31, 2024, hedging gains of $ 11.9 million for the year ended December 31, 2023, and hedging gains of $ 49.4 million for the year ended December 31, 2022.

(a) Revenues include hedging losses of $ 12.4 million for the year ended December 31, 2025, hedging losses of $ 2.6 million for the year ended December 31, 2024, and hedging gains of $ 11.9 million for the year ended December 31, 2023.

Hedging gains (losses) do not represent revenues recognized from contracts with customers.

Refer to Note 15 for presentation of our revenues disaggregated by geography.

As our homebuilding operations accounted for over 97 %,of our total revenues for the year ended December 31, 2024 and 98 % for both years ended December 31, 2023 and 2022, with most of those revenues generated from home purchase contracts with customers, we believe the disaggregation of revenues as disclosed above and in Note 15 fairly depict how the nature, amount, timing and uncertainty of cash flows are affected by economic factors.

As our homebuilding operations accounted for over 97 % of our total revenues for each of the years ended December 31, 2025 and December 31, 2024 and 98 % for year ended December 31, 2023, with most of those revenues generated from home purchase contracts with customers, we believe the disaggregation of revenues as disclosed above and in Note 15 fairly depict how the nature, amount, timing and uncertainty of cash flows are affected by economic factors.

Land and Housing Cost of Sales.

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The Company is currently evaluating the impact the adoption of ASU 2023-06 may have on our consolidated financial statements and disclosures, but we do not expect the impact to be significant.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”).

ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the title and position of the entity’s CODM.

The amendments in this update also expand the interim segment disclosure requirements.

ASU 2023-07 became effective for us for the fiscal year ending December 31, 2024 and we applied the amendments retrospectively to all prior periods presented in our consolidated financial statements.

See Note 15 to our Consolidated Financial Statements for more information regarding our reportable segments.

In December 2023, the FASB issued ASU No.

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ASU 2023-09 will be effective for the annual reporting periods in fiscal years beginning after December 15, 2024.

The Company is currently evaluating the impact the adoption of ASU 2023-09 may have on our consolidated financial statements and disclosures, but we do not expect the impact to be significant.

In March 2024, the SEC issued Final Rule Release No.

33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors .

This rule will require registrants to disclose certain climate-related information in registration statements and annual reports.

The rules require information about a registrant’s climate-related risks that are reasonably likely to have a material impact on its business, results of operations, or financial condition.

The required information about climate-related risks will also include disclosure of a registrant’s greenhouse gas emissions.

In addition, the rules will require registrants to present certain climate-related financial metrics in their audited financial statements.

These requirements are effective for the Company in various fiscal years, starting with the disclosure requirements in the Company's fiscal year beginning January 1, 2025.

Disclosures will be required prospectively, with information for prior periods required only to the extent it was previously disclosed in an SEC filing.

The Company is currently evaluating the final rule to determine its impact on the Company's disclosures.

The Rule is currently the subject of litigation in the 8th Circuit Court of Appeals.

On April 4, 2024, the SEC voluntarily stayed the implementation of the Rule pending completion of the litigation.

ASU 2023-09 became effective for us for the fiscal year ending December 31, 2025 and we applied the amendments retrospectively to all prior periods presented in our consolidated financial statements.

See Note 14 to our Consolidated Financial Statements for more information regarding our Income taxes.

In November 2024, the FASB issued ASU No.

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The aggregate intrinsic value of options exercised during the years ended December 31, 2025, 2024 and 2023 was $ 13.3 million, $ 50.1 million and $ 45.2 million, respectively.

The fair value of our five-year service-based stock options granted during the years ended December 31, 2023 and 2022 was established at the date of grant using the Black-Scholes pricing model, with the weighted average assumptions as follows:

The fair value of our five-year service-based stock options granted during the year ended December 31, 2023 was established at the date of grant using the Black-Scholes pricing model, with the weighted average assumptions as follows:

Year Ended December 31,

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Weighted average grant date fair value of options granted during the period $ 24.67

The risk-free interest rate is based upon the U.S.

Treasury constant maturity rate at the date of the grant.

Expected volatility is based on an average of (1) historical volatility of the Company’s stock and (2) implied volatility from traded options on the Company’s stock.

The risk-free rate for periods within the contractual life of the stock option award is based on the yield curve of a zero-coupon U.S.

Treasury bond on the date the stock option award is granted, with a maturity equal to the expected term of the stock option award granted.

The Company uses historical data to estimate stock option exercises and forfeitures within its valuation model.

The expected life of stock option awards granted is derived from historical exercise experience under the Company’s share-based payment plans, and represents the period of time that stock option awards granted are expected to be outstanding.

Total stock-based compensation expense related to stock option awards that has been charged against income was $ 5.0 million, $ 5.9 million and $ 7.5 million for the years ended December 31, 2025, 2024 and 2023, respectively, relating to the 2018 LTIP and the 2009 LTIP.

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Employee Restricted Share Units

In lieu of issuing stock option awards, on February 15, 2024, the Company awarded certain of its employees 133,149 restricted share units under the 2018 LTIP, at a price of $ 124.66 (the closing price of our common shares on the New York Stock Exchange on such date) that vest ratably over a three-year period (subject to the employee’s continued service on the vesting date (except in certain circumstances)) and will be settled in common shares.

On February 11, 2025 and February 15, 2024, the Company awarded certain of its employees an aggregate of 88,603 and 133,149 restricted share units, respectively, under the 2018 LTIP.

The closing price of our common shares on the New York Stock Exchange on such date was $ 119.65 and $ 124.66 , respectively.

These awards vest ratably over a three-year period (subject to the employee’s continued service on the vesting date (except in certain circumstances)) and will be settled in common shares.

Stock-based compensation expense for our employee restricted share units is recognized over the vesting period applicable to the award (amortized over three years).

The Company recognized compensation expense related to the awards of $ 4.7 million in 2024.

The Company recognized compensation expense related to the awards of $ 8.7 million and $ 4.7 million for 2025 and 2024, respectively.

As of December 31, 2025, there was a total of $ 13.4 million of unrecognized compensation expense related to unvested restricted share units that will be recognized as stock-based compensation expense over a weighted average period of 1.4 years.

2 unchanged sentences

Employee RSUs outstanding at December 31, 2024

129,941 $ 124.66

Granted 88,603 119.65

( 30,018 ) 124.38

Forfeited — —

2 unchanged sentences

Director Restricted Stock Units

In 2024, the Company awarded each non-employee director 1,622 restricted stock units, for a total of 11,354 restricted stock units, under the 2018 LTIP which will vest on the first anniversary of the date of grant (subject to the non-employee director’s continued service on the Board of Directors on the vesting date (except in the case of death or disability)) and will be settled in common shares upon the director’s termination of service as a director.

The Company awarded its non-employee directors a total of 26,350 and 31,997 restricted stock units under the 2018 LTIP during the years ended December 31, 2023 and 2022, respectively.

In 2025, the Company awarded each non-employee director 1,822 restricted stock units, for a total of 12,754 restricted stock units, under the 2018 LTIP which will vest on the first anniversary of the date of grant (subject to the non-employee director’s continued service on the Board of Directors on the vesting date (except in the case of death or disability)) and will be settled in common shares no later than the fifteenth day of the third month following the vesting date.

The Company awarded its non-employee directors a total of 11,354 and 26,350 restricted stock units under the 2018 LTIP during the years ended December 31, 2024 and 2023, respectively, which vested on the first anniversary of the date of grant (subject to the non-employee director’s continued service on the Board of Directors on the vesting date (except in the case of death or disability)) and will be settled in common shares upon the director’s resignation of service as a director.

The grant date fair value for the director restricted stock units is based upon the closing price of our common shares on the date of grant.

Stock-based compensation expense for our director restricted stock units is recognized over the vesting period applicable to the award (amortized over one year).

The Company recognized stock-based compensation expense related to the awards of $ 1.4 million in 2024, $ 1.5 million in 2023 and $ 1.4 million in 2022.

As of December 31, 2024, there

was a total of $ 0.5 million of unrecognized compensation expense related to director restricted stock units that will be recognized as stock-based compensation expense in 2025.

The Company recognized stock-based compensation expense related to the awards of $ 1.4 million in both 2025 and 2024 and $ 1.5 million in 2023.

As of December 31, 2025, there was a total of $ 0.5 million of unrecognized compensation expense related to director restricted stock units that will be recognized as stock-based compensation expense in 2025.

The following table summarizes director restricted stock units activity for the year ended December 31, 2025, relating to the restricted stock units awarded to directors under the 2018 LTIP:

3 unchanged sentences

Granted 12,754 73.16

( 11,997 ) 66.67

Forfeited — —

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Performance Share Unit Awards

On February 15, 2024, February 15, 2023 and February 17, 2022, the Company awarded its executive officers (in the aggregate) a target number of PSU’s under the 2018 LTIP equal to 20,856 , 27,243 and 33,619 PSU’s, respectively.

On February 11, 2025, February 15, 2024 and February 15, 2023, the Company awarded certain of its executive officers (in the aggregate) a target number of PSU’s under the 2018 LTIP equal to 21,729 , 20,856 and 27,243 PSU’s, respectively.

Each PSU represents a contingent right to receive one common share of the Company if vesting is satisfied at the end of a three-year performance period (the “Performance Period”) based on the related performance conditions and market conditions.

The ultimate number of PSU’s that will vest and be earned, if any, after the completion of the Performance Period, is based on (1) (a) the Company’s cumulative annual pre-tax income from operations, excluding extraordinary items as defined in the underlying award agreements with the executive officers, over the Performance Period (weighted 80 %) (the “Performance Condition”), and (b) the Company’s relative total shareholder return over the Performance Period compared to the total shareholder return of a peer group of other publicly-traded homebuilders (weighted 20 %) (the “Market Condition”) and (2) the participant’s continued employment through the end of the Performance Period, except in the case of termination due to death, disability or retirement or involuntary termination without cause by the Company.

underlying award agreements with the executive officers, over the Performance Period (weighted 80 %) (the “Performance Condition”), and (b) the Company’s relative total shareholder return over the Performance Period compared to the total shareholder return of a peer group of other publicly-traded homebuilders (weighted 20 %) (the “Market Condition”) and (2) the participant’s continued employment through the end of the Performance Period, except in the case of termination due to death, disability or retirement or involuntary termination without cause by the Company.

The number of PSU’s that vest may increase by up to 50% from the target number based on levels of achievement of the above criteria as set forth in the applicable award agreements and decrease to zero if the Company fails to meet the minimum performance levels for both of the above criteria.

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13,964 $ 517 55,864 $ 1,708

(a) Intrinsic value is defined as the amount by which the fair value of the underlying common shares exceeds the exercise price of the award.

(a) Intrinsic value is defined as the amount by which the fair value of the underlying common shares exceeds the grant price of the award.

(b) The adjustment for performance results achieved for the PSU’s granted in 2022 that vested during the first quarter of 2025.

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As of December 31, 2025, there were a total of 8,469 equity units with a value of $ 0.6 million outstanding under the Plans.

The aggregate fair market value of these units at December 31, 2024, based on the closing price of the underlying common shares, was approximately $ 5.9 million, and the associated deferred tax benefit the Company would recognize if the outstanding units were distributed was $ 2.4 million as of December 31, 2024.

The aggregate fair market value of these units at December 31, 2025, based on the closing price of the underlying common shares, was approximately $ 1.1 million.

The deferred tax benefit the Company would recognize if all outstanding units to directors (including stock units and restricted stock units) were distributed was $ 2.0 million as of December 31, 2025.

Common shares are issued from treasury shares upon distribution of equity units from the Plans.

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Level 1, Level 2, and Level 3.

Fair values determined by Level 1 inputs utilize quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

Fair values determined by Level 2 inputs utilize inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability.

Fair values determined by Level 1 inputs utilize quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Fair values determined by Level 2 inputs utilize inputs other than quoted prices included in Level 1 that are observable for the assets or liabilities, either directly or indirectly.

Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the assets or liabilities, such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3 inputs are unobservable inputs for the assets or liabilities, and include situations where there is little, if any, market activity for the assets or liabilities.

Assets Measured on a Recurring Basis

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The forward sale contracts lock in an interest rate and price for the sale of loans similar to the specific rate lock commitments.

The Company does not engage in speculative trading or derivative activities.

The Company does not engage in speculative trading activities.

Both the rate lock commitments to borrowers and the forward sale contracts to broker/dealers or investors are undesignated derivatives, and accordingly, are marked to fair value through earnings.

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To calculate the effects of interest rate movements, the Company utilizes applicable published mortgage-backed security prices and multiplies the price movement between the rate lock date and the balance sheet date by the notional loan commitment amount.

The Company applies a fallout rate to IRLCs when measuring the fair value of rate lock

The Company applies a fallout rate to IRLCs when measuring the fair value of rate lock commitments.

Fallout is defined as locked loan commitments for which the Company does not close a mortgage loan and is based on management’s judgment and company experience.

14 unchanged sentences

Forward Sales of Mortgage-Backed Securities .

FMBSs are used to protect uncommitted IRLC loans against the risk of changes in interest rates between the lock date and the funding date.

Forward sales of mortgage-backed securities (“ FMBSs”) are used to protect uncommitted IRLC loans against the risk of changes in interest rates between the lock date and the funding date.

FMBSs related to uncommitted IRLCs and FMBSs related to mortgage loans held for sale are classified and accounted for as non-designated derivative instruments and are recorded at fair value, with gains and losses recorded in current earnings.

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Notes Payable - Homebuilding Operations.

The interest rate available to the Company during 2024 under the Company’s $ 650 million unsecured revolving credit facility, dated July 18, 2013 , as amended mostly recently in December 2022 (the “Credit Facility”), fluctuated daily with SOFR plus a margin of 175 basis points, and thus the carrying value is a reasonable estimate of fair value.

The interest rate available to the Company during 2025 under the Company’s $ 900 million unsecured revolving credit facility, dated July 18, 2013 , as amended mostly recently on September 18, 2025 (the “Credit Facility”), fluctuated daily with SOFR plus a margin of 150 basis points, and thus the carrying value is a reasonable estimate of fair value.

See Note 11 to our Consolidated Financial Statements for additional information regarding the Credit Facility.

Notes Payable - Financial Services Operations.

M/I Financial is a party to a $ 300 million mortgage repurchase agreement, dated October 24, 2023 , as amended most recently in October 2024 (the “MIF Mortgage Repurchase Facility”).

For this credit facility, the interest rate is based on a variable rate index, and thus its carrying value is a reasonable estimate of fair value.

M/I Financial is a party to a $ 200 million mortgage repurchase agreement, dated October 24, 2023 , as amended most recently in October 2025 (the “MIF Mortgage Repurchase Facility”), and an uncommitted $ 100 million mortgage repurchase agreement dated October 20, 2025 (the “MIF Master Repurchase Facility”).

For these credit facilities, the interest rate is based on a variable rate index, and thus its carrying value is a reasonable estimate of fair value.

The interest rate available to M/I Financial fluctuated with SOFR.

See Note 11 to our Consolidated Financial Statements for additional information regarding the MIF Mortgage Repurchase Facility.

See Note 11 to our Consolidated Financial Statements for additional information regarding the MIF Mortgage Repurchase Facility and MIF Master Repurchase Facility.

Inventory and Capitalized Interest

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As of December 31, 2025 and 2024, we had 2,779 homes (with a carrying value of $ 680.6 million) and 2,502 homes (with a carrying value of $ 551.3 million), respectively, included in homes under construction that were not subject to a sales contract.

Homes under construction increased from prior year due to the Company’s inventory management decision to offer more affordable homes that are move-in ready in order for customers to benefit from selective sales incentives.

This increase from prior year is primarily attributable to the Company’s inventory management decision to offer more affordable homes that are move-in ready in order for customers to benefit from selective sales incentives.

Model homes and furnishings include homes that are under construction or have been completed and are being used as sales models.

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As of December 31, 2025 and 2024, our investment in such joint venture arrangements totaled $ 106.3 million and $ 65.3 million, respectively, and was reported as Investment in Joint Venture Arrangements on our Consolidated Balance Sheets.

The increase from prior year was driven primarily by our cash contributions to our joint venture arrangements during 2024 of $ 54.1 million offset, in part, by lot distributions from our joint venture arrangements during 2024 of $ 33.2 million.

The increase from prior year was driven primarily by our cash contributions to our joint venture arrangements during 2025 of $ 59.2 million offset, in part, by lot distributions from our joint venture arrangements during 2025 of $ 16.2 million and return of capital from joint ventures of $ 2.0 million

The majority of our investment in joint venture arrangements for both 2025 and 2024 consisted of joint ownership and development agreements for which a special purpose entity was not established (“JODAs”).

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Under the equity method, our share of the LLCs’ earnings or loss, if any, is included in our Consolidated Statements of Income.

There were no losses or income from the Company’s LLCs during the year ended December 31, 2024.

The Company’s equity in income relating to earnings from its LLCs were less than $0.1 million for the years ended December 31, 2023 and 2022.

There were no losses or income from the Company’s LLCs during the year ended December 31, 2025 and 2024.

The Company’s equity in income relating to earnings from its LLCs were less than $0.1 million for the years ended December 31, 2023.

Our share of the profit relating to lots we purchase from our LLCs is deferred until homes are delivered by us and title passes to a homebuyer.

We believe that the Company’s maximum exposure related to its investment in these joint venture arrangements as of December 31, 2024 was the amount invested of $ 65.3 million, which is reported as Investment in Joint Venture Arrangements on our Consolidated Balance Sheets.

We believe that the Company’s maximum exposure related to its investment in these joint venture arrangements as of December 31, 2025 was the amount invested of $ 106.3 million, which is reported as Investment in Joint Venture Arrangements

on our Consolidated Balance Sheets.

We expect to invest further amounts in these joint venture arrangements as development of the properties progresses.

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(2) the financial condition and near-term prospects of the joint venture arrangement;

and (3) the intent and ability of the Company to retain its investment in the joint venture arrangements for a period of time sufficient to allow for any

anticipated recovery in market value.

and (3) the intent and ability of the Company to retain its investment in the joint venture arrangements for a period of time sufficient to allow for any anticipated recovery in market value.

Due to uncertainties in the estimation process and the significant volatility in demand for new housing, actual results could differ significantly from such estimates.

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Loans totaling approximately $ 687.6 million and $ 936.0 million were covered under these guarantees as of December 31, 2025 and 2024, respectively.

The increase in loans covered by these guarantees from December 31, 2023 is a result of a change in the mix of investors and their related purchase terms.

The decrease in loans covered by these guarantees from December 31, 2024 is a result of a change in the mix of investors and their related purchase terms.

A portion of the revenue paid to M/I Financial for providing the guarantees on these loans was deferred at December 31, 2025, and will be recognized in income as M/I Financial is released from its obligation under the guarantees.

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Actual future costs associated with these guarantees and indemnities could differ materially from our current estimated amounts.

At both December 31, 2024 and 2023, guarantees and indemnities of $ 2.4 million were included in Other Liabilities on the Consolidated Balance Sheets.

At December 31, 2025 and 2024, guarantees and indemnities of $ 2.8 million and $ 2.4 million, respectively, were included in Other Liabilities on the Consolidated Balance Sheets.

Commitments and Contingencies

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Changes in estimates for pre-existing warranties

( 168 ) 5,268 2,457

Charges related to unusual warranty claims (a)

Settlements made during the period ( 27,247 ) ( 25,215 ) ( 24,904 )

Warranty reserves, end of period $ 43,958 $ 36,219 $ 31,980

(a) The Company incurred an increase in warranty expense attributable to two communities in Florida primarily due to attic ventilation issues.

At December 31, 2025, the Company had a remaining accrual related to these warranty claims of $9.0 million.

Performance Bonds and Letters of Credit

The Company provides standby letters of credit and completion bonds for development work in progress, deposits on land and lot purchase agreements and miscellaneous deposits.

At December 31, 2024, the Company had outstanding approximately $ 488.4 million of completion bonds and standby letters of credit, some of which were issued to various local governmental entities that expire at various times through August 2029.

At December 31, 2025, the Company had outstanding approximately $ 590.1 million of completion bonds and standby letters of credit, some of which were issued to various local governmental entities that expire at various times through November 2030.

Included in this total are:

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In addition, we evaluate our land option or purchase agreements to determine for each contract if (1) a portion or all of the purchase price is a specific performance requirement, or (2) the amount of deposits and prepaid acquisition and development costs exceed certain thresholds relative to the remaining purchase price of the lots.

If either is the case, then the remaining purchase price of the lots (or the specific performance amount, if applicable) is recorded as an asset and liability in Consolidated Inventory Not Owned (as further described below) on our Consolidated Balance Sheets.

Other than as described below in “Consolidated Inventory Not Owned and Related Obligation,” the Company currently believes that its maximum exposure as of December 31, 2024 related to our land option agreements is equal to the amount of the Company’s outstanding deposits and prepaid acquisition costs, which totaled $ 97.1 million, including cash deposits of $ 69.5 million, prepaid acquisition costs of $ 13.7 million, letters of credit of $ 12.7 million and $ 1.2 million of other non-cash deposits.

If either is the case, then the remaining

purchase price of the lots (or the specific performance amount, if applicable) is recorded as an asset and liability in Consolidated Inventory Not Owned (as further described below) on our Consolidated Balance Sheets.

Other than as described below in “Consolidated Inventory Not Owned and Related Obligation,” the Company currently believes that its maximum exposure as of December 31, 2025 related to our land option agreements is equal to the amount of the Company’s outstanding deposits and prepaid acquisition costs, which totale d $ 99.5 million, including cash deposits of $ 74.5 million, prepaid acquisition costs of $ 12.4 million, letters of credit of $ 11.4 million and $ 1.2 million of other non-cash deposits.

During the year ended December 31, 2025, the Company recorded $ 11.8 million in write-offs of land deposits and pre-acquisition costs related to land that we no longer intend to purchase.

Other Similar Contracts

At December 31, 2025, the Company also had options and contingent purchase agreements to acquire land and developed lots with an aggregate purchase price of approximately $ 1.58 billion.

3 unchanged sentences

At December 31, 2025 and 2024, the corresponding liability of $ 30.3 million and $ 11.8 million, respectively, has been classified as Obligation for Consolidated Inventory Not Owned on the Consolidated Balance Sheets.

The decrease in this balance from December 31, 2023 is related primarily to a decrease in the number of land purchase agreements that had deposits and prepaid acquisition and development costs that exceeded certain thresholds resulting in the remaining purchase price of the lots to be recorded in inventory not owned.

The increase in this balance from December 31, 2024 is related primarily to an increase in the number of land purchase agreements that had deposits and prepaid acquisition and development costs that exceeded certain thresholds resulting in the remaining purchase price of the lots to be recorded in inventory not owned.

Legal Matters

The Company and certain of its subsidiaries have been named as defendants in certain other legal proceedings which are incidental to our business.

While management currently believes that the ultimate resolution of these other legal proceedings, individually and in the aggregate, will not have a material effect on the Company’s financial position, results of operations and cash flows, such legal proceedings are subject to inherent uncertainties.

The Company and certain of its subsidiaries have been named as defendants in certain legal proceedings incidental to our business.

While management currently believes that the ultimate resolution of these legal proceedings, individually and in the aggregate, will not have a material effect on the Company’s financial position, results of operations and cash flows, such legal proceedings are subject to inherent uncertainties.

The Company has recorded a liability to provide for the anticipated costs, including legal defense costs, associated with the resolution of these other legal proceedings.

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Due to our election of the practical expedient, leases with an initial term of twelve months or less are not recorded on the balance sheet.

As the rate implicit in our leases is not readily determinable, the Company uses its estimated incremental borrowing rate at the commencement date in determining the present value of the lease payments.

As the rate implicit in our leases is not readily determinable, the Company uses its estimated incremental

borrowing rate at the commencement date in determining the present value of the lease payments.

We give consideration to our debt issuances as well as to the current rate available under our Credit Facility when calculating our incremental borrowing rate.

Our lease agreements do not contain any residual value guarantees or material restrictive covenants.

During the twelve months ended December 31, 2024, the Company’s operating ROU asset and operating lease liability decreased by $ 2.5 million and $ 2.2 million, respectively, as a result of $ 9.5 million of additional ROU asset amortization and $ 9.2 million of additional periodic lease expense, offset partially by $ 7.0 million in additional leases and modifications to existing leases throughout the period (which is recorded within its Consolidated Statement of Cash Flows in the change in Other Assets and Other Liabilities).

During the twelve months ended December 31, 2025, the Company’s operating ROU asset and operating lease liability increased by $ 1.1 million and $ 1.3 million, respectively, as a result of $ 8.3 million of additional ROU asset amortization and $ 8.1 million of additional periodic lease expense, offset partially by $ 9.4 million in additional leases and modifications to existing leases throughout the period (which is recorded within its Consolidated Statement of Cash Flows in the change in Other Assets and Other Liabilities).

The Company also obtained non-cash lease ROU assets in exchange for lease liabilities of $ 9.4 million and $ 7.0 million during the years ended December 31, 2025 and 2024, respectively.

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If the owner of the parcel fails to pay the Assessment, the CDD may foreclose on the lien pursuant to powers conferred to the CDD under applicable state laws and/or foreclosure procedures.

In connection with the development of certain of the Company’s communities, CDDs have been established and bonds have been issued to finance a portion of the related infrastructure.

In connection with the development of certain of the Company’s communities, CDDs have been established and bonds have been issued to finance a

portion of the related infrastructure.

Following are details relating to such CDD bond obligations issued and outstanding as of December 31, 2025 and 2024:

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4/1/2024 5/1/2053 5.58 % 2,590 2,590

10/24/2025 5/1/2055 5.60 % 3,950 —

Total CDD bond obligations issued and outstanding $ 52,140 $ 48,190

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Notes Payable - Homebuilding

The Credit Facility provides for an aggregate commitment amount of $ 650 million and also includes an accordion feature pursuant to which the maximum borrowing availability may be increased to an aggregate of $ 800 million, subject to obtaining additional commitments from lenders.

The Credit Facility matures on December 9, 2026 .

Interest on amounts borrowed under the Credit Facility is payable at multiple interest rate options including one, three or six month adjusted term SOFR (subject to a floor of 0.25 %) plus a margin of 175 basis points (subject to adjustment in subsequent quarterly periods based on the Company’s leverage ratio).

The Credit Facility provides for an aggregate commitment amount of $ 900 million and also includes an accordion feature pursuant to which the maximum borrowing availability may be increased to an aggregate of $ 1.05 billion, subject to obtaining additional commitments from lenders.

The Credit Facility matures on September 18, 2030 .

Interest on amounts borrowed under the Credit Facility is payable at an adjusted term SOFR plus a margin of 150 basis points (subject to adjustment in subsequent quarterly periods based on the Company’s leverage ratio).

The available amount under the Credit Facility is computed in accordance with a borrowing base, which is calculated by applying various advance rates for different categories of inventory, and totaled $ 2.4 billion of availability for additional senior debt at December 31, 2025.

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Our obligations under the Credit Facility are effectively subordinated to our and the Subsidiary Guarantors’ existing and future secured indebtedness with respect to any assets comprising security or collateral for such indebtedness.

The Credit Facility contains various representations, warranties and covenants which require, among other things, that the Company maintain (1) a minimum level of Consolidated Tangible Net Worth ($ 1.8 billion at December 31, 2024 and subject to increase over time based on earnings and proceeds from equity offerings), (2) a leverage ratio not in excess of 60 %, and (3) either a minimum Interest Coverage Ratio of 1.5 to 1.0 or a minimum amount of available liquidity.

In addition, the Credit Facility contains covenants that limit the Company's number of unsold housing units and model homes, as well as the amount of Investments in Unrestricted Subsidiaries and Joint Ventures.

The Credit Facility contains various representations, warranties and covenants which require, among other things, that the Company maintain (1) a minimum level of Consolidated Tangible Net Worth ($ 2.2 billion at December 31, 2025 and subject to increase over time based on earnings and proceeds from equity offerings), (2) a leverage ratio not in excess of 60 %, and (3)

either a minimum Interest Coverage Ratio of 1.5 to 1.0 or a minimum amount of available liquidity.

In addition, the Credit Facility contains covenants that limit the amount of Investments in Unrestricted Subsidiaries and Joint Ventures.

At December 31, 2025, the Company was in compliance with all financial covenants of the Credit Facility.

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The MIF Mortgage Repurchase Facility is used to finance eligible residential mortgage loans originated by M/I Financial.

M/I Financial pays interest on each advance under the MIF Mortgage Repurchase Facility at a per annum rate based on Daily Adjusting One-Month Term SOFR plus a margin as defined in the MIF Mortgage Repurchase Facility.

M/I Financial pays interest on each advance under the MIF Mortgage Repurchase Facility at a per annum rate based on Daily Simple SOFR plus a margin as defined in the MIF Mortgage Repurchase Facility.

The MIF Mortgage Repurchase Facility also contains certain financial covenants.

At December 31, 2024, M/I Financial was in compliance with all financial covenants of the MIF Mortgage Repurchase Facility.

The MIF Master Repurchase Facility provides an uncommitted maximum borrowing availability of $ 100 million and expires on October 20, 2026 .

The MIF Master Repurchase Facility is used to finance eligible residential mortgage loans originated by M/I Financial.

M/I Financial pays interest on each advance under the MIF Master Repurchase Facility at a per annum rate based on Daily Simple SOFR plus a margin as defined in the MIF Master Repurchase Facility.

The MIF Master Repurchase Facility also contains the same financial covenants as MIF Mortgage Repurchase Facility.

At December 31, 2025, M/I Financial was in compliance with all financial covenants of the MIF Mortgage Repurchase Facility and MIF Master Repurchase Facility.

At December 31, 2025 and 2024, M/I Financial’s total combined maximum borrowing availability under its credit facilities was $ 300.0 million.

At December 31, 2024 and 2023, M/I Financial had $ 286.2 million and $ 165.8 million, respectively, in borrowings outstanding under the MIF Mortgage Repurchase Facility.

At December 31, 2025 and 2024, M/I Financial had $ 276.9 million and $ 286.2 million, respectively, in aggregate borrowings outstanding under the MIF Mortgage Repurchase Facility and MIF Master Repurchase Facility.

As of both December 31, 2025 and 2024, we had $ 300.0 million of our 2030 Senior Notes outstanding.

The 2030 Senior Notes bear interest at a rate of 3.95 % per year, payable semiannually in arrears on February 15 and August 15 of each year, and mature on February 15, 2030 .

principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the redemption date, plus a “make-whole” amount set forth in the indenture governing the 2030 Senior Notes.

The Company may redeem some or all of the 2030 Senior Notes at any time prior to August 15, 2029 (the date that is six months prior to the maturity of the 2030 Senior Notes), at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the redemption date, plus a “make-whole” amount set forth in the indenture governing the 2030 Senior Notes.

In addition, on or after August 15, 2029 (the date that is six months prior to the maturity of the 2030 Senior Notes), the Company may redeem some or all of the 2030 Senior Notes at a redemption price equal to 100.000 % of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the redemption date.

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The 2028 Senior Notes bear interest at a rate of 4.95 % per year, payable semiannually in arrears on February 1 and August 1 of each year, and mature on February 1, 2028 .

We may redeem all or any portion of the 2028 Senior Notes on or after February 1, 2023 at a stated redemption price, together with accrued and unpaid interest thereon.

The redemption price is equal to 101.238 % of the principal amount outstanding if redeemed during the 12-month period beginning on February 1, 2025 and will decline to 100.000 % of the principal amount outstanding if redeemed on or after February 1, 2026, but prior to maturity.

We may redeem all or any portion of the 2028 Senior Notes prior to maturity at a stated redemption price ( 100.000 % of the principal amount outstanding), together with accrued and unpaid interest thereon.

The 2030 Senior Notes contain certain covenants, as more fully described and defined in the indenture governing the 2030 Senior Notes, which limit the ability of the Company and the restricted subsidiaries to, among other things:

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2026 $ 276,856

Thereafter 300,000

Total $ 976,856

Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and liabilities assumed in business combinations.

In connection with the Company’s acquisition of the homebuilding assets and operations of a builder in Detroit, Michigan in March 2018, the Company recorded goodwill of $ 16.4 million, which is included as Goodwill in our Consolidated Balance Sheets.

In connection with the Company’s acquisition of the homebuilding assets and operations of Pinnacle Homes in Detroit, Michigan in March 2018, the Company recorded goodwill of $ 16.4 million, which is included as Goodwill in our Consolidated Balance Sheets.

This amount was based on the estimated fair values of the acquired assets and liabilities at the date of the acquisition in accordance with ASC 350.

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Based upon a review of all available evidence, we believe our deferred tax assets were fully realizable in all periods presented.

The Inflation Reduction Act (“IRA”) was enacted August 16, 2022 to address the high cost of prescription drugs, healthcare availability, climate change and inflation.

The IRA extended the energy efficient homes credit through 2032 and, as a result, the Company recognized a $ 3.6 million year-to-date tax benefit during 2024.

At December 31, 2025, the Company’s total deferred tax assets were $ 34.1 million which were offset by $ 29.6 million of total deferred tax liabilities for a $ 4.5 million net deferred tax asset which is reported on the Company’s Consolidated Balance Sheets.

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Federal effect of state deferred taxes $ 170 $ 485

Inventory 9,944 —

Depreciation 5,093 6,309

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Total $ 123,647 $ 169,883 $ 141,912

Our provision for income taxes includes tax benefits of $ 4.5 million, $ 3.6 million and $ 2.0 million for the years ended 2025, 2024 and 2023, respectively, under The Inflation Reduction Act.

The One Big Beautiful Bill Act (the “Act”) enacted on July 4, 2025, terminates the availability of this benefit on June 30, 2026.

We do not anticipate the Act will have a material impact to our financial statements as a whole.

For 2025, 2024 and 2023, the Company’s effective tax rate was 23.5 %, 23.2 %, and 23.4 %, respectively.

Reconciliation of the differences between income taxes computed at the federal statutory tax rate and consolidated benefit from income taxes are as follows:

The following table provides a reconciliation of the differences between the effective income tax rate and the federal statutory tax rate for 2025, 2024 and 2023:

Year Ended December 31,

(In thousands) 2024 2023 2022

(In thousands) 2025 Percent

Pre-tax income

$ 526,588 $ 733,608 $ 607,277

Federal taxes at statutory rate 110,584 21.0 % 154,058 21.0 % 127,528 21.0 %

State and local taxes – net of federal tax benefit (1)

Equity Compensation ( 5,299 ) ( 6,457 ) ( 166 )

18,662 3.5 % 25,205 3.4 % 20,172 3.3 %

Nontaxable or nondeductible items

473 0.1 % ( 2,655 ) ( 0.4 ) % ( 1,812 ) ( 0.3 ) %

Federal tax credits ( 4,453 ) ( 0.8 ) % ( 3,562 ) ( 0.5 ) % ( 1,991 ) ( 0.3 ) %

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Total $ 123,647 23.5 % $ 169,883 23.2 % $ 141,912 23.4 %

(1) The states that contributed to a majority (greater than 50%) of the tax effect in this category include Florida, Illinois and Minnesota for 2025, 2024 and 2023.

The Company files income tax returns in the U.S.

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We believe that our current income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change.

The amounts of cash taxes paid by the Company for 2025, 2024 and 2023 were as follows:

Year Ended December 31,

(In thousands) 2025 %

$ 105,822 81 % $ 137,735 86 % $ 124,620 83 %

State and local taxes:

7,822 6 % 5,476 3 % 9,301 6 %

Other 17,796 14 % 16,411 11 % 16,747 11 %

Total $ 131,440 100 % $ 159,622 100 % $ 150,668 100 %

In 2025 and 2023, the only jurisdiction with cash taxes paid that exceeded 5% of total income taxes paid was Florida.

In 2024 there was no individual jurisdiction with cash taxes paid that equaled or exceeded 5% of total income taxes paid.

Business Segments

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Financial services (a)

Total cost of sales $ 3,305,781 $ 3,014,573 $ 3,087,551

Total cost of sales (b)

$ 3,400,582 $ 3,305,781 $ 3,014,573

General and administrative expense:

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( 89,632 ) ( 88,983 ) ( 77,980 )

Total operating income (a)

Total operating income (a) (b)

$ 506,553 $ 706,094 $ 587,222

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$ ( 20,035 ) $ ( 27,514 ) $ ( 20,022 )

Other income (b)

Other income (c)

$ — $ — $ ( 33 )

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(a) Our financial services operational results should be viewed in connection with our homebuilding business as its operations originate loans and provide title services primarily for our homebuying customers, with the exception of an immaterial amount of mortgage refinancing.

(b) Other income is comprised of the equity in (income) loss from joint venture arrangements.

(b) For the year ended December 31, 2025, total cost of sales and operating income were reduced by $ 47.7 million in inventory impairment charges and write-offs of land deposits and pre-acquisition costs taken during the period.

$ 6.7 million and $ 41.0 million of these charges and write-offs were attributable to the Northern homebuilding operating segment and the Southern homebuilding operating segment, respectively.

Additionally, total cost of sales and operating income in the Southern homebuilding operating segment were reduced by $ 11.2 million for warranty charges in two of our Florida communities primarily relating to attic ventilation issues (See Note 8 ).

The following table shows, by segment, depreciation and amortization expense for the years ended December 31, 2025, 2024 and 2023:

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Share Repurchase Program

On May 14, 2024, the Company announced that its Board of Directors approved a new share repurchase program pursuant to which the Company may purchase up to $ 250 million of its outstanding common shares (the “2024 Share Repurchase Program”).

The 2024 Share Repurchase Program replaced the share repurchase program approved by the Board of Directors in 2021 (the “2021 Share Repurchase Program”).

Pursuant to the 2024 Share Repurchase Program, the Company was authorized to purchase up to $ 250 million of its outstanding common shares through open market transactions, privately negotiated transactions or otherwise in accordance with all applicable laws.

The timing, amount and other terms and conditions of any additional repurchases under the 2024 Share Repurchase Program was based on a variety of factors, including the market price of the Company’s common shares, business considerations, general market and economic conditions and legal requirements.

During the year ended December 31, 2024, the Company repurchased 1.2 million outstanding common shares at an aggregate purchase price of $ 177.0 million under the 2024 Share Repurchase Program and 2021 Share Repurchase Program.

As of December 31, 2024, $ 106.7 million remained available for repurchases under the 2024 Share Repurchase Program.

On February 11, 2025, the Company announced that its Board of Directors approved a new share repurchase program pursuant to which the Company may purchase up to $ 250 million of its outstanding common shares (the “2025 Share Repurchase Program”).

The 2025 Share Repurchase Program replaces the 2024 Share Repurchase Program.

The 2025 Share Repurchase Program replaced the share repurchase program approved by the Board of Directors in 2024 (the “2024 Share Repurchase Program”).

On November 12, 2025, the Company announced that its Board of Directors approved a new share repurchase program pursuant to which the Company may purchase up to $ 250 million of its outstanding common shares (the “Second 2025 Share Repurchase Program).

The Second 2025 Share Repurchase Program replaced the 2025 Share Repurchase Program approved by the Board of Directors in February 2025.

Under the Second 2025 Share Repurchase Program, the Company is authorized to purchase up to $ 250 million of its outstanding common shares through open market transactions, privately negotiated transactions or otherwise in accordance with all applicable laws.

The timing, amount and other terms and conditions of any additional repurchases under the Second 2025 Share Repurchase Program was based on a variety of factors, including the market price of the Company’s common shares, business considerations, general market and economic conditions and legal requirements.

During the year ended December 31, 2025, the Company repurchased 1.6 million outstanding common shares at an aggregate purchase price of $ 202.0 million under the 2025 Share Repurchase Program, the Second 2025 Share Repurchase Program and the 2024 Share Repurchase Program compared to 1.2 million outstanding common shares repurchased at an aggregate purchase price of $ 177.0 million under the 2024 Share Repurchase Program and 2021 Share Repurchase Program during the year ended

December 31, 2024.

As of December 31, 2025, $ 220 million remained available for repurchases under the Second 2025 Share Repurchase Program.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

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-K

Item 8. Financial Statements and Supplementary Data