What changed in this filing

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Item 1. Financial Statements

2026-04-24 compared with 2025-10-31 · 148 added, 286 removed, 624 unchanged (41% of the section changed)

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UNAUDITED CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

September 30, 2025 December 31, 2024

(in thousands, except share and par value amounts)

March 31, 2026 December 31, 2025

Cash and cash equivalents $ 766,632 $ 775,157

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Accounts payable $ 199,943 $ 200,679

Accrued liabilities 414,717 452,213

Accrued and other liabilities 408,718 387,698

Home sale deposits 10,907 9,213

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Authorized 10,000,000 shares;

none issued and outstanding at September 30, 2025 and December 31, 2024

none issued and outstanding at March 31, 2026 and December 31, 2025

Common stock, par value $ 0.01 .

Authorized 125,000,000 shares;

70,406,707 and 71,921,972 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively

66,702,433 and 68,168,923 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively

Additional paid-in capital — —

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(in thousands, except per share amounts)

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

2025 2024 2025 2024

Three Months Ended March 31,

Homebuilding:

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Home closing gross profit 193,798 295,650

Land closing gross profit 192 680 2,638 687

Land closing gross (loss)/profit ( 269 ) 3,165

Total closing gross profit 193,529 298,815

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Expense ( 3,623 ) ( 4,192 )

Earnings/(loss) from financial services unconsolidated entities and other, net 331 ( 1,263 ) 1,846 ( 4,853 )

Earnings from financial services unconsolidated entities and other, net 831 673

Financial services profit 3,493 3,563

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Other income, net 6,963 9,498

Loss on early extinguishment of debt — — — ( 631 )

Earnings before income taxes 72,524 160,159

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Diluted 67,806 72,650

(1) Share and per share amounts have been retroactively adjusted to reflect the 2-for-1 stock split that was effective on January 2, 2025.

See accompanying notes to unaudited consolidated financial statements

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(in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities:

Net earnings $ 55,309 $ 122,806

Adjustments to reconcile net earnings to net cash used in operating activities:

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

Depreciation and amortization 5,373 5,949

Real estate and land impairments 2,427 —

Write-off of terminated land deals 1,373 1,433

Stock-based compensation 5,860 6,325

Loss on early extinguishment of debt — 631

Equity in earnings from unconsolidated entities ( 656 ) ( 626 )

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Changes in assets and liabilities:

Increase in real estate ( 413,224 ) ( 723,835 )

Increase in deposits on real estate under option or contract ( 9,010 ) ( 96,404 )

(Increase)/decrease in other receivables, prepaids and other assets ( 77,840 ) 7,307

(Decrease)/increase in accounts payable and accrued liabilities ( 45,326 ) 21,387

Decrease in home sale deposits ( 11,093 ) ( 4,472 )

Net cash used in operating activities ( 125,385 ) ( 128,013 )

Decrease/(increase) in real estate 34,049 ( 60,821 )

Decrease/(increase) in deposits on real estate under option or contract 7,389 ( 62,179 )

Decrease/(increase) in other receivables, prepaids and other assets 29,018 ( 37,636 )

Decrease in accounts payable and accrued and other liabilities ( 43,274 ) ( 16,041 )

Increase/(decrease) in home sale deposits 1,694 ( 2,863 )

Net cash provided by/(used in) operating activities 101,309 ( 42,576 )

Cash flows from investing activities:

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Proceeds from sales of property and equipment 94 29

Maturities/sales of investments and securities 1,750 750

Payments to purchase investments and securities ( 1,750 ) ( 750 )

Net cash used in investing activities ( 7,731 ) ( 11,413 )

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Repayment of loans payable and other borrowings ( 33 ) ( 2,150 )

Repayment of senior notes — ( 250,695 )

Proceeds from issuance of senior and convertible senior notes 497,195 575,000

Proceeds from issuance of senior notes — 497,195

Payment of debt issuance costs — ( 5,073 )

Purchase of capped calls related to issuance of convertible senior notes — ( 61,790 )

Proceeds from liabilities related to consolidated real estate not owned 59,947 —

Dividends paid ( 32,017 ) ( 30,887 )

Repurchase of shares ( 130,000 ) ( 44,999 )

Net cash provided by financing activities 243,808 69,782

Net increase/(decrease) in cash and cash equivalents 77,382 ( 89,668 )

Net cash (used in)/provided by financing activities ( 102,103 ) 414,086

Net (decrease)/increase in cash and cash equivalents ( 8,525 ) 360,097

Cash and cash equivalents, beginning of period 775,157 651,555

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We primarily build in long-term high-growth markets of the United States and offer a variety of entry-level and first move-up homes.

We have operations in three regions:

We have homebuilding operations in three regions:

West, Central and East, which are comprised of twelve states:

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(“Meritage Insurance ” ), our wholly-owned insurance broker, works in collaboration with insurance companies nationwide to offer homeowners insurance and other insurance products to our homebuyers.

Our financial services operation also provides mortgage services to our homebuyers through an unconsolidated joint venture.

Our financial services operations also provide mortgage services to our homebuyers through an unconsolidated joint venture.

We commenced our homebuilding operations in 1985 through our predecessor company, Monterey Homes.

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Meritage Homes' homebuilding construction, development and sales activities are conducted through its subsidiaries.

Our homebuilding activities are conducted under the name of Meritage Homes in each of our homebuilding markets.

At September 30, 2025, we were actively selling homes in 334 communities, with base prices ranging from approximately $ 176,000 to $ 1,020,000 .

Its homebuilding activities are conducted under the name of Meritage Homes in each of our homebuilding markets.

At March 31, 2026, we were actively selling homes in 345 communities, with base prices ranging from approximately $ 162,000 to $ 1,000,000 .

Basis of Presentation.

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The unaudited consolidated financial statements include the accounts of Meritage Homes and those of our consolidated subsidiaries, partnerships and other entities in which we have a controlling financial interest, and of variable interest entities (see Note 3) in which we are deemed the primary beneficiary (collectively, “us”, “we”, “our” and “the Company”).

Certain reclassifications have been made to prior year footnotes in the accompanying unaudited consolidated financial statements to conform to classifications used in the current year, including share and per share amounts and reporting segments, as discussed further below.

Certain reclassifications have been made to prior year footnotes and in the accompanying unaudited consolidated financial statements to conform to classifications used in the current year.

Intercompany balances and transactions have been eliminated in consolidation.

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

On November 21, 2024, our Board of Directors declared a two -for-one stock split (the "Stock Split") of Meritage’s common stock in the form of a stock dividend.

Each stockholder of record at the close of business on December 31, 2024 received one additional share of common stock for each share of common stock held, payable after the close of market on January 2, 2025.

Trading began on a split-adjusted basis on January 3, 2025.

There was no adjustment to the number of authorized shares or the par value.

As required by Accounting Standards Codification ("ASC") 260, Earnings Per Share , all share and per share amounts in the accompanying unaudited consolidated financial statements have been retroactively adjusted to reflect the Stock Split for all periods presented, inclusive of dividends and share repurchases.

Operating and Reporting Segments.

Effective January 1, 2025, we realigned our internal organizational structure and resources following continued growth and recent entry into new markets.

As a result of the change in our organizational structure, the Tennessee homebuilding operating segment was reclassified from the East reporting segment to the Central reporting segment for the purpose of making operational and resource decisions and assessing financial performance.

Prior period balances have been retroactively adjusted to reflect this reclassification.

S tock Split.

Effective January 2, 2025, our common stock was split two -for-one (the "Stock Split"), with no adjustment to the number of authorized shares or the par value.

Cash and Cash Equivalents.

Liquid investments with an initial maturity of three months or less are classified as cash equivalents.

Amounts in transit from title companies or closing agents for home closings of approximately $ 57.6 million and $ 29.0 million are included in Cash and cash equivalents at September 30, 2025 and December 31, 2024, respectively.

Amounts in transit from title companies or closing agents for home closings of approximately $ 55.3 million and $ 20.1 million are included in Cash and cash equivalents at March 31, 2026 and December 31, 2025, respectively.

Real estate inventory is stated at cost unless the community or land is determined to be impaired, at which point the inventory is written down to fair value as required by ASC 360-10, Property, Plant and Equipment (“ASC 360-10”) .

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For these parcels, we have chosen not to currently develop certain land holdings as they typically represent a portion or phases of a larger land parcel that we plan to build out over several years.

Mothball communities represent communities where we have elected to stop development of an existing community because we believe the economic performance of the community would be maximized by deferring development for a period of time to allow market conditions to improve.

Mothball communities represent communities where we have elected to stop development of an existing actively selling community because we believe the economic performance of the community would be maximized by deferring development for a period of time to allow market conditions to improve.

We do not capitalize interest for these inactive assets, and all ongoing costs of land ownership (i.e.

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Actual results can differ from budgeted amounts for various reasons, including construction delays, labor or material shortages, sales orders absorption rates that differ from our expectations, increases in costs that have not yet been contracted, changes in governmental requirements, or other unanticipated issues encountered during construction and development and other factors beyond our control, including weather.

To address uncertainty in these budgets, we assess, update and revise project budgets on a regular basis, utilizing the most current information available to estimate home construction and land development costs.

To address uncertainty in these budgets, we update and revise project budgets on a regular basis, utilizing the most current information available to estimate home construction and land development costs.

Typically, a community's life cycle ranges from three to five years , commencing with the acquisition of the land, continuing through the land development phase, if applicable, and concluding with the construction, sale and closing of the homes.

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Existing communities.

Community-level reviews are performed quarterly to determine if indicators of potential impairment exist.

Community-level reviews on active communities are performed quarterly, and are bifurcated between started and unstarted lots, to determine if indicators of potential impairment exist.

If indicators of potential impairment exist and the undiscounted cash flows expected to be generated by an asset are lower than its carrying amount, impairment charges are recorded to write down the asset to its estimated fair value.

The impairment of a community is allocated across the remaining lots in the community and is recognized in Cost of home closings in the period in which the impairment is determined.

The fair value of the community’s assets is determined using either a market-based approach for projects to be sold or a discounted cash flow model for projects we intend to build out.

The fair value of the community’s assets is determined using either a market-based approach for projects to be sold or a discounted cash flow model for longer-termed projects we intend to build out.

If a market-based approach is used, we determine fair value based on recent comparable purchase and sale activity in the local market, adjusted for variances as determined by our knowledge of the region and general real estate expertise.

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Community-level factors that may impact our key estimates include:

• Our current experience in the market;

• The presence and significance of local competitors, including their offered product type, comparable lot size, remaining lots and competitive actions such as incentive offerings;

• Economic and related demographic conditions for the surrounding community;

• Economic and related demographic conditions for the surrounding community, such as major employers;

• Desirability of the particular community, including unique amenities or other favorable or unfavorable attributes;

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These local circumstances may significantly impact our assumptions and the resulting computation of fair value and are, therefore, closely evaluated by our division personnel in their preparation of the discounted cash flow models.

The models are also evaluated by regional and corporate personnel for consistency and integration, as decisions that affect pricing or absorption at one community may have resulting consequences for neighboring communities.

The models are

also evaluated by regional and corporate personnel for consistency and integration, as decisions that affect pricing or absorption at one community may have resulting consequences for neighboring communities.

Mothball communities.

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If we decide to mothball a community, we will impair it to its fair value, if applicable, as discussed above and then cease future development activity until such a time when management believes that market conditions have improved and economic performance will be maximized.

Impairment charges, if any, are recognized in Cost of home closings in the period in which the impairment is determined.

No costs are capitalized to communities that are designated as mothballed.

When a community is initially placed into mothball status, it is management’s belief that the community is affected by local market conditions that are expected to improve within the next 1-5 years.

Therefore, a temporary postponement of construction and development work is expected to yield better overall returns.

Mothballed communities are reviewed at least annually to determine if they are at risk of future impairment.

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Land held for sale or future development is reviewed at least annually to determine if it is at risk of future impairment.

For land held for sale, our assessments typically involve third-party valuations, such as broker opinions, and recent comparable land sales in the area.

For land held for future development, our assessments typically include highly subjective estimates for future performance, including the timing of development, the product to be offered, orders rates and selling prices of the product when the community is anticipated to open for sales, and the projected costs to develop and construct the community.

Our assessments on land held for sale or land held for future development typically involve third-party valuations, such as broker opinions, and recent comparable land sales in the area.

For land held for future development, our assessments typically include highly subjective estimates for future performance, including the timing of development, the product to be offered, orders pace and selling prices of the product when the community is anticipated to open for sales, and the projected costs to develop and construct the community.

We evaluate various factors to develop our forecasts, including the availability of and demand for homes and finished lots within the surrounding community, historical, current and future sales trends, and third-party data, if available.

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Since our acquisition contracts typically do not require specific performance, we do not consider such contracts to be contractual obligations to purchase the land and our total exposure under such contracts is limited to the loss of any non-refundable deposits and any related capitalized costs.

Our Deposits on real estate under option or contract were $ 198.2 million and $ 192.4 million as of September 30, 2025 and December 31, 2024, respectively.

Our Deposits on real estate under option or contract were $ 166.2 million and $ 174.2 million as of March 31, 2026 and December 31, 2025, respectively.

See Note 3 for additional information related to Deposits on real estate under option or contract.

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Such qualitative factors include:

(1) macroeconomic conditions, such as a deterioration in general economic conditions, (2) industry and market considerations such as deterioration in the environment in which the entity operates, (3) cost factors such as increases in raw materials, labor costs, etc., and (4) overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings.

(1) macroeconomic conditions, such as a deterioration in general economic conditions;

(2) industry and market considerations such as deterioration in the environment in which the entity operates;

(3) cost factors such as increases in raw materials, labor costs, etc.;

and (4) overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings.

If the qualitative analysis determines that additional impairment testing is required, a two-step impairment test in accordance with ASC 350 would be initiated.

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Leases that meet the criteria of ASC 842 are recorded on our balance sheets as right-of-use ("ROU") assets and lease liabilities.

ROU assets are classified within Prepaids, other assets and goodwill on the accompanying unaudited consolidated balance sheets, while lease liabilities are classified within Accrued liabilities on the accompanying unaudited consolidated balance sheets.

ROU assets are classified within Prepaids, other assets and goodwill on the accompanying unaudited consolidated balance sheets, while lease liabilities are classified within Accrued and other liabilities on the accompanying unaudited consolidated balance sheets.

The table below outlines our ROU assets and lease liabilities (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

ROU assets $ 57,164 $ 56,985

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The table below outlines our surety bond and letter of credit obligations (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Outstanding Estimated work

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Total LOCs $ 80,958 N/A $ 75,547 N/A

Accrued Liabilities .

Accrued liabilities at September 30, 2025 and December 31, 2024 consisted of the following (in thousands):

September 30, 2025 December 31, 2024

Accrued and Other Liabilities .

Accrued and other liabilities at March 31, 2026 and December 31, 2025 consisted of the following (in thousands):

March 31, 2026 December 31, 2025

Accruals related to real estate development and construction activities $ 138,514 $ 144,122

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Lease liabilities 60,784 60,470

Liabilities related to consolidated real estate not owned 59,947 —

Other accruals 20,446 29,014

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We regularly review our warranty reserves and adjust them, as necessary, to reflect changes in trends as information becomes available.

Based on such reviews of warranty costs incurred, we did not adjust the warranty reserve balance in the three or nine months ended September 30, 2025 or 2024.

Included in the warranty reserve balances at September 30, 2025 and December 31, 2024 are case-specific warranty reserves, as discussed in Note 15.

Based on such reviews of warranty costs incurred, we did not record any adjustments in the three months ended March 31, 2026 or 2025.

Included in the warranty reserve balances at March 31, 2026 and December 31, 2025 are case-specific warranty reserves, as discussed in Note 15.

A summary of changes in our warranty reserves follows (in thousands):

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

2025 2024 2025 2024

Three Months Ended March 31,

Balance, beginning of period $ 26,677 $ 32,693

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Balance, end of period $ 26,042 $ 35,352

Warranty reserves are included in Accrued liabilities on the accompanying unaudited consolidated balance sheets, and additions and adjustments to the reserves are included in Cost of home closings within the accompanying unaudited consolidated income statements.

Warranty reserves are included in Accrued and other liabilities on the accompanying unaudited consolidated balance sheets, and additions and adjustments to the reserves are included in Cost of home closings within the accompanying unaudited consolidated income statements.

These reserves are intended to cover costs associated with our contractual and statutory warranty obligations, which include, among other items, claims involving defective workmanship and materials.

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Revenue from financial services includes estimated future insurance policy renewal commissions as our performance obligations are satisfied upon issuance of the initial policy with a third party broker.

The related contract assets for these estimated future renewal commissions are no t material at September 30, 2025 and December 31, 2024.

The related contract assets for these estimated future renewal commissions are no t material at March 31, 2026 and December 31, 2025.

Recent Accounting Pronouncements.

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which aligns interim segment disclosure requirements with existing annual requirements and includes updates to segment reporting, most notably through enhanced disclosures about significant segment expenses and the Chief Operating Decision Maker ("CODM").

We adopted ASU 2023-07 for the annual period beginning January 1, 2024, and for interim periods beginning January 1, 2025.

ASU 2023-07 is applied retrospectively to all prior periods presented in the accompanying unaudited consolidated financial statements.

In December 2023, the FASB issued ASU No.

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures ("ASU 2023-09"), which modifies the disclosure requirements primarily related to the effective tax rate reconciliation and income taxes paid by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction.

ASU 2023-09 is effective for our annual report covering the fiscal year beginning January 1, 2025 and may be applied either retrospectively or prospectively.

We are currently evaluating the impact adopting this guidance will have on our financial statement disclosures.

We adopted ASU 2023-09 for the annual period beginning January 1, 2025 and for interim periods beginning January 1, 2026.

ASU 2023-09 is applied retrospectively to all prior periods presented in these financial statements.

In November 2024, the FASB issued ASU No.

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We are currently evaluating the impact adopting this guidance will have on our financial statement disclosures.

In November 2024, the FASB issued ASU No.

2024-04, Debt—Debt with Conversion and Other Options (Subtopic 470-20):

Induced Conversions of Convertible Debt Instruments ("ASU 2024-04"), which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion.

We adopted ASU 2024-04 on January 1, 2025 on a prospective basis and will apply the amendments to any future settlements of convertible debt instruments, if applicable.

The adoption of ASU 2024-04 did not have any impact on the accompanying unaudited consolidated financial statements.

In September 2025, the FASB issued ASU No.

2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software ("ASU 2025-06"), which modernizes the accounting for the costs of internal-use software by removing all references to software development project stages so that the guidance is neutral to different software development methods.

ASU 2025-06 is effective for our annual and interim reports covering the fiscal year beginning January 1, 2028, and may be applied on a retrospective, modified transition or prospective basis.

We are currently evaluating the impact adopting this guidance will have on our consolidated financial statements.

NOTE 2 — REAL ESTATE AND CAPITALIZED INTEREST

Real estate consists of the following (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Homes completed and under construction (1)

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3,963,883 3,917,572

Consolidated real estate not owned (3)

Total $ 5,962,075 $ 5,987,120

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(2) Includes raw land, land held for development, land held for sale and communities in mothball status, less impairments, if any.

Land held for development, land held for sale and communities in mothball status totaled $ 118.5 million and $ 62.7 million as of September 30, 2025 and December 31, 2024, respectively.

Land held for development, land held for sale and communities in mothball status totaled $ 190.9 million and $ 164.4 million as of March 31, 2026 and December 31, 2025, respectively.

We do not capitalize interest for these inactive assets, and all ongoing costs of land ownership (i.e.

property taxes, homeowner association dues, etc.) are expensed as incurred.

(3) See Note 3 for additional information on consolidated real estate not owned.

Subject to sufficient qualifying assets, we capitalize our development period interest costs incurred to applicable qualifying assets in connection with our real estate development and construction activities.

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A summary of our capitalized interest is as follows (in thousands):

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

2025 2024 2025 2024

Three Months Ended March 31,

Capitalized interest, beginning of period $ 77,064 $ 53,678

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As discussed in Note 1, and in accordance with ASC 360-10, all of our land inventory and related real estate assets are periodically reviewed for recoverability when certain criteria are met, but at least annually, as our inventory is considered “long-lived” in accordance with GAAP.

Due to the current economic environment, we evaluated our Real estate assets during the three months ended September 30, 2025.

Based on these reviews, we recorded the following impairment charges during the three and nine months ended September 30, 2025 (in thousands).

There were no impairment charges recorded during the three and nine months ended September 30, 2024.

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

Based on these reviews, we recorded the following impairment charges during the three months ended March 31, 2026 and 2025 (in thousands).

Three Months Ended March 31, Three Months Ended March 31,

Real estate inventory impairments:

West $ 543 $ 543

Central 1,273 —

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Impairments of land held for sale:

East 599 $ 599

Total $ — $ —

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As discussed in Note 1, non-refundable deposits are expensed to Cost of home closings when a land acquisition is terminated or no longer considered probable.

The following tables summarizes the write-offs of non-refundable deposits and associated pre-acquisitions costs for terminated land deals during the periods presented (in thousands):

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

2025 2024 2025 2024

The following tables summarizes the write-offs of non-refundable deposits and associated pre-acquisition costs for terminated land contracts during the periods presented (in thousands):

Three Months Ended March 31,

Terminated option/purchase contracts and related pre-acquisition costs:

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Central 342 336

East $ 3,151 572 $ 7,107 1,126

Total $ 1,373 $ 1,433

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In accordance with ASC 810, Consolidation , we evaluate all purchase and option agreements for land to determine whether they are a variable interest entity ("VIE"), and if so, whether we are the primary beneficiary.

Although we do not have legal title to the underlying land, if we are the primary beneficiary we are required to consolidate the VIE in our financial statements and reflect its assets and liabilities as Real estate not owned and Liabilities related to real estate not owned, respectively.

We determined that as of September 30, 2025 and December 31, 2024, we were not the primary beneficiary of any VIEs from which we have acquired rights to land or lots under option contracts.

The table below presents a summary of our lots under option at September 30, 2025 (dollars in thousands):

See Notes 2 and 1 for a detail of these asset and liability balances, respectively, if any.

The table below presents a summary of our lots under option at March 31, 2026 (dollars in thousands):

Projected Number

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Deposits–Cash

Purchase and option contracts recorded on balance sheet as Real estate not owned — $ — $ —

Option contracts — non-refundable deposits, committed (1)

10,881 970,742 115,217

Purchase contracts — non-refundable deposits, committed (1)

Purchase and option contracts — committed 19,740 $ 3,739,750 $ 159,149

Purchase and option contracts — uncommitted (1)

14,628 1,014,956 7,087

Purchase and option contracts —refundable deposits, committed 1,098 14,877 1,100

Total committed 25,214 1,535,430 188,027

Purchase and option contracts — refundable deposits, uncommitted (2)

Total purchase and option contracts (2)

34,368 4,754,706 166,236 (3)

Total lots under contract or option 46,172 $ 2,733,246 $ 198,158

Total purchase and option contracts not recorded on balance sheet (3)

Purchase contracts recorded on balance sheet as Real estate (2)

3,161 $ 65,159 $ — (4)

(1) Deposits are non-refundable except if certain contractual conditions are not performed by the selling party.

(2) Deposits are refundable at our sole discretion.

(1) We have not completed our acquisition evaluation process and we have not internally committed to purchase these lots.

(3) Except for our specific performance contracts recorded on the accompanying unaudited consolidated balance sheets as Real estate not owned (if any), none of our purchase or option contracts require us to purchase lots.

(4) Amount is reflected on the accompanying unaudited consolidated balance sheets in Deposits on real estate under option or contract as of September 30, 2025.

(2) N one of our purchase or option contracts require us to purchase lots, except for our specific performance contracts.

The purchase price for specific performance contracts are recorded on the accompanying unaudited consolidated balance sheets as Real estate .

See Note 2 for details of the Real estate balance.

(3) Amount is reflected on the accompanying unaudited consolidated balance sheets in Deposits on real estate under option or contract as of March 31, 2026.

(4) Deposits for specific performance contracts are recorded on the accompanying unaudited consolidated balance sheets as Real estate.

Generally, our options to purchase lots remain effective so long as we purchase a pre-established minimum number of lots on a pre-determined schedule in accordance with each respective agreement.

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Our mortgage joint venture is engaged in mortgage activities and primarily provides mortgage services to our homebuyers.

As of September 30, 2025, we had three active equity-method land joint ventures and one mortgage joint venture.

As of March 31, 2026, we had three active equity-method land joint ventures and one mortgage joint venture.

Summarized condensed combined financial information related to unconsolidated joint ventures that are accounted for using the equity method was as follows (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

$ 20,320 $ 3,516

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Total liabilities and equity $ 211,476 $ 191,430

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

2025 2024 2025 2024

Three Months Ended March 31,

Revenue $ 12,793 $ 10,740

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Meritage’s share of pre-tax earnings (1) (2)

$ 969 $ 1,298 $ 3,133 $ 3,925

(1) Balance represents Meritage’s interest, as reflected in the financial records of the respective joint ventures.

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(i) timing differences for revenue and distributions recognition, (ii) step-up basis and corresponding amortization, (iii) capitalization of interest on qualified assets, (iv) income deferrals as discussed in Note (2) below and (v) the cessation of allocation of losses from joint ventures in which we have previously written down our investment balance to zero and where we have no commitment to fund additional losses.

(2) Our share of pre-tax earnings from our mortgage joint venture is recorded in Earnings/(loss) from financial services unconsolidated entities and other, net on the accompanying unaudited consolidated income statements.

(2) Our share of pre-tax earnings from our mortgage joint venture is recorded in Earnings from financial services unconsolidated entities and other, net on the accompanying unaudited consolidated income statements.

Our share of pre-tax earnings from all other joint ventures is recorded in Other income, net on the accompanying unaudited consolidated income statements and excludes joint venture profit related to lots we purchased from the joint ventures, if any.

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Loans payable and other borrowings consist of the following (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Other borrowings, secured real estate notes payable (1)

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Borrowings under the Credit Facility bear interest at the Company's option, at either (1) term Secured Overnight Financing Rate ("SOFR") (based on 1, 3, or 6 month interest periods, as selected by the Company) plus a 10 basis point adjustment plus an applicable margin (ranging from 110 basis points to 175 basis points (the "applicable margin")) based on the Company's leverage ratio as determined in accordance with a pricing grid, (2) the higher of (i) the prime lending rate ("Prime"), (ii) an overnight bank rate plus 50 basis points and (iii) term SOFR (based on a 1 month interest period) plus a 10 basis point adjustment plus 1 %, in each case plus a margin ranging from 10 basis points to 75 basis points based on the Company's leverage in accordance with a pricing grid, or (3) daily simple SOFR plus a 10 basis point adjustment plus the applicable margin.

At September 30, 2025, the interest rate on outstanding borrowings under the Credit Facility would have been 5.329 % per annum, calculated in accordance with option (1) noted above and using the 1-month term SOFR.

At March 31, 2026, the interest rate on outstanding borrowings under the Credit Facility would have been 4.865 % per annum, calculated in accordance with option (1) noted above and using the 1-month term SOFR.

We are obligated to pay a fee on the undrawn portion of the Credit Facility at a rate determined by a tiered fee matrix based on our leverage ratio.

The Credit Facility also contains certain financial covenants, including (a) a minimum tangible net worth requirement of $ 3.3 billion (which amount is subject to increase over time based on subsequent earnings and proceeds from equity offerings), and (b) a maximum leverage covenant that prohibits the leverage ratio (as defined therein) from exceeding 60 %.

We were in compliance with all Credit Facility covenants as of September 30, 2025.

We had no outstanding borrowings under the Credit Facility as of September 30, 2025 and December 31, 2024.

There were no borrowings or repayments under the Credit Facility during the three months ended September 30, 2025, and $ 5.0 million of borrowings and repayments under the Credit Facility during the nine months ended September 30, 2025.

There were no borrowings or repayments under the Credit Facility during the three and nine months ended September 30, 2024.

As of September 30, 2025, we had outstanding letters of credit issued under the Credit Facility totaling $ 84.1 million, leaving $ 825.9 million available under the Credit Facility to be drawn.

We were in compliance with all Credit Facility covenants as of March 31, 2026.

We had no outstanding borrowings under the Credit Facility as of March 31, 2026 and December 31, 2025.

There were no borrowings or repayments under the Credit Facility during the three months ended March 31, 2026, and $ 5.0 million of borrowings and repayments under the Credit Facility during the three months ended March 31, 2025.

As of March 31, 2026, we had outstanding letters of credit issued under the Credit Facility totaling $ 81.0 million, leaving $ 829.0 million available under the Credit Facility to be drawn.

NOTE 6 — SENIOR AND CONVERTIBLE SENIOR NOTES, NET

Senior and convertible senior notes, net consist of the following (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

5.125 % senior notes due 2027 ("2027 Notes")

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5.650 % senior notes due 2035 ("2035 Notes").

At September 30, 2025, there was $ 2,642 in net unamortized discount.

At March 31, 2026, there was $ 2,501 in net unamortized discount.

497,499 497,429

Net debt issuance costs ( 16,215 ) ( 17,703 )

Total $ 1,806,284 $ 1,804,726

There have been no material changes to the terms of the 2028 Convertible Notes and the related capped call transactions since those described in Note 7 - Senior and Convertible Senior Notes, Net in the consolidated financial statements included in our Annual Report.

During the three months ended March 31, 2026, the circumstances allowing holders of the 2028 Convertible Notes to convert were not met.

The indentures for our 2027 Notes, 2029 Notes and 2035 Notes contain covenants that place limits on secured debt and sale and leaseback transactions.

We were in compliance with all such covenants as of September 30, 2025.

We were in compliance with all such covenants as of March 31, 2026.

Obligations to pay principal and interest on the senior and convertible senior notes are guaranteed by substantially all of our wholly-owned subsidiaries (each a “Guarantor” and, collectively, the “Guarantor Subsidiaries”), each of which is directly or indirectly 100 % owned by Meritage Homes.

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In the event of a sale or other disposition of all of the assets of any Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the equity interests of any Guarantor then held by Meritage and its subsidiaries, then that Guarantor may be released and relieved of any obligations under its note guarantee.

There are no significant restrictions on our ability or the ability of any Guarantor to obtain funds from their respective subsidiaries, as applicable, by dividend or loan.

There are no significant restrictions on our ability or the ability of Meritage Homes or any Guarantor to obtain funds from their respective subsidiaries, as applicable, by dividend or loan.

We do not provide separate financial statements of the Guarantor Subsidiaries because Meritage Homes (the parent company) has no independent assets or operations and the guarantees are full and unconditional and joint and several.

Subsidiaries of Meritage Homes Corporation that are non-guarantor subsidiaries are, individually and in the aggregate, minor, and accordingly, the assets, liabilities and results of operations of Meritage Homes Corporation and the Guarantor Subsidiaries are not materially different than the corresponding amounts presented in the unaudited consolidated financial statements of Meritage Homes.

In March 2025, we completed an offering of $ 500.0 million aggregate principal amount of 5.650 % 2035 Notes.

The 2035 Notes were issued at a discount of 99.439 % of the principal amount and the net proceeds are intended to be used for general corporate purposes.

2028 Convertible Notes

In May 2024, we issued $ 575.0 million aggregate principal amount of 1.750 % 2028 Convertible Notes.

The 2028 Convertible Notes were issued at par and will mature on May 15, 2028, unless converted earlier in accordance with their terms prior to such date.

We used a portion of the net proceeds from the offering to pay the cost of entering into the Capped Calls, as defined and described below, and to redeem all $ 250.0 million aggregate principal then outstanding of our 6.00 % Senior Notes due 2025 for which we incurred $ 0.6 million in early debt extinguishment charges in the nine months ended September 30, 2024, reflected as Loss on early extinguishment of debt in the accompanying unaudited consolidated income statements.

The 2028 Convertible Notes are convertible into shares of the Company’s common stock at an initial conversion rate of 8.6096 shares of common stock per $1,000 principal amount of the 2028 Convertible Notes, which is equivalent to an initial conversion price of approximately $ 116.15 per share and is subject to adjustment in certain circumstances.

In addition, we must provide additional shares upon conversion if there is a "Make-Whole Fundamental Change".

The Company is required to satisfy its conversion obligations by paying cash up to the principal amount of notes and settle any additional value in cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election.

Prior to February 15, 2028, the holders of the 2028 Convertible Notes may convert their notes only upon satisfaction of certain circumstances.

During the three and nine months ended September 30, 2025, the circumstances allowing holders of the 2028 Convertible Notes to convert were not met.

On or after February 15, 2028, until the close of business on the second scheduled trading day immediately preceding the maturity date of the Notes, holders may convert all or any portion of their Notes at any time, regardless of the foregoing circumstances.

For additional details related to our 2028 Convertible Notes and Capped Calls, see Note 7 in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Capped Call Transactions

Concurrent with the offering of the 2028 Convertible Notes, we used a portion of the net proceeds to enter into privately negotiated capped call transactions (the "Capped Calls”) which require the Capped Calls counterparties (the "Counterparties") to provide shares of our common stock to converting debt holders up to a cap price.

The Capped Calls each have an initial strike price of approximately $ 116.15 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2028 Convertible Notes.

The Capped Calls have initial cap prices of $ 175.32 per share, subject to certain adjustments.

The Capped Calls will reduce our obligation to settle, in shares or in cash, conversions when our stock price is between $ 116.15 and $ 175.32 .

The Capped Calls are separate transactions entered into by the Company with each of the Counterparties, are not part of the terms of the 2028 Convertible Notes and do not change the note holders’ rights under the 2028 Convertible Notes or the indenture governing the 2028 Convertible Notes.

Holders of the 2028 Convertible Notes do not have any rights with respect to the Capped Calls.

As the Capped Calls are considered indexed to the Company's own stock, they are recorded in stockholders’ equity as a reduction of Additional paid-in capital in the accompanying unaudited consolidated balance sheets, and are not accounted for as derivatives under ASC 815-10, Derivatives and Hedging .

are not materially different than the corresponding amounts presented in the unaudited consolidated financial statements of Meritage Homes.

NOTE 7 — FAIR VALUE DISCLOSURES

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The fair value of our fixed-rate debt is derived from quoted market prices by independent dealers (Level 2 inputs as per the discussion above) and is as follows (in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Principal Estimated Fair

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Our Real estate assets are Level 3 instruments that are required to be recorded at fair value only if events and circumstances indicate that the carrying value may not be recoverable.

The fair value of inventories that were measured as of September 30, 2025 was $ 392.4 million.

See Note 1 for information on the significant observable and unobservable inputs we utilized in our fair value measurements with respect to the real estate assets measured at fair value.

The fair value of real estate inventories that were measured as of March 31, 2026 was $ 259.8 million.

See Note 1 for information on the significant observable and unobservable inputs we utilized in our fair value measurements with respect to the Real estate assets measured at fair value, and Note 2 for a summary of the impairment charges on Real estate to bring the assets to their estimated fair value.

NOTE 8 — EARNINGS PER SHARE

Basic and diluted earnings per common share were calculated as follows (in thousands, except per share amounts):

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

2025 2024 2025 2024

Three Months Ended March 31,

Basic weighted average number of shares outstanding 67,367 71,915

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In accordance with ASC 260-10, Earnings Per Share , we calculate the dilutive effect of the 2028 Convertible Notes using the "if-converted" method.

As discussed in Note 6, the Company will settle any convertible note conversions by paying cash up to the principal amount of notes and settle any additional value in cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election.

As discussed in Note 7 - Senior and Convertible Senior Notes, Net in the consolidated financial statements included in our Annual Report, the Company will settle any convertible note conversions by paying cash up to the principal amount of notes and settle any additional value in cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election.

As the Company will settle the principal amount of convertible notes in cash upon conversion, the convertible notes only have a dilutive impact when the average share price of the Company’s common stock exceeds the conversion price, in any applicable period.

Share and per share amounts have been retroactively adjusted to reflect the Stock Split that was effective on January 2, 2025.

NOTE 9 — ACQUISITIONS AND GOODWILL

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Additions — — — — — —

Balance at September 30, 2025 $ — $ 10,247 $ 22,715 $ — $ — $ 32,962

(1) Effective January 1, 2025, the Tennessee homebuilding operating segment has been reclassified from the East reporting segment to the Central reporting segment.

See Note 1 for additional information about the reclassification of the Tennessee homebuilding operating segment.

Prior period balances have been retroactively adjusted to reflect this reclassification.

Balance at March 31, 2026 $ — $ 10,247 $ 22,715 $ — $ — $ 32,962

NOTE 10 — STOCKHOLDERS’ EQUITY

A summary of changes in stockholders’ equity is presented below (in thousands):

Nine Months Ended September 30, 2025

Three Months Ended March 31, 2026

(In thousands)

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Balance at December 31, 2025 68,169 $ 682 $ — $ 5,194,961 $ 5,195,643

Stock Split effective January 2, 2025 (See Note 8) — 360 ( 360 ) — —

Net earnings — — — 55,309 55,309

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Balance at March 31, 2026 66,702 $ 667 $ — $ 5,093,102 $ 5,093,769

Net earnings — — — 146,879 146,879

Stock-based compensation expense — — 3,597 — 3,597

Dividends declared — — — ( 30,597 ) ( 30,597 )

Share repurchases ( 674 ) ( 6 ) ( 45,443 ) — ( 45,449 )

Balance at June 30, 2025 71,157 $ 712 $ 62,084 $ 5,206,378 $ 5,269,174

Net earnings — — — 99,297 99,297

Stock-based compensation expense — — 4,858 — 4,858

Issuance of stock 22 — — — —

Dividends declared — — — ( 30,275 ) ( 30,275 )

Share repurchases ( 772 ) ( 8 ) ( 55,526 ) — ( 55,534 )

Balance at September 30, 2025 70,407 $ 704 $ 11,416 $ 5,275,400 $ 5,287,520

Nine Months Ended September 30, 2024

Three Months Ended March 31, 2025

(In thousands)

Shares Common

Stock Additional

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Balance at December 31, 2024 71,922 $ 360 $ 143,036 $ 4,998,177 $ 5,141,573

Stock Split on January 2, 2025 — 360 ( 360 ) — —

Net earnings — — — 122,806 122,806

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Balance at March 31, 2025 71,831 $ 718 $ 103,930 $ 5,090,096 $ 5,194,744

Net earnings — — — 231,555 231,555

Stock-based compensation expense — — 4,718 — 4,718

Issuance of stock 16 — — — —

Dividends declared — — — ( 27,245 ) ( 27,245 )

Capped call transactions, net of tax — — ( 47,067 ) — ( 47,067 )

Balance at June 30, 2024 72,654 363 198,503 4,683,668 4,882,534

Net earnings — — — 195,966 195,966

Stock-based compensation expense — — 8,473 — 8,473

Dividends declared — — — ( 27,135 ) ( 27,135 )

Issuance of stock 8 — — — —

Share repurchases ( 302 ) ( 1 ) ( 30,047 ) — ( 30,048 )

Balance at September 30, 2024 72,360 $ 362 $ 176,929 $ 4,852,499 $ 5,029,790

(1) Share amounts have been retroactively adjusted to reflect the Stock Split that was effective on January 2, 2025.

During the three months ended September 30, 2025 and 2024, our Board of Directors approved, and we paid, a quarterly cash dividend on common stock of $ 0.43 and $ 0.375 per share, respectively.

Quarterly dividends declared and paid during the nine months ended September 30, 2025 and 2024, totaled $ 1.29 and $ 1.125 per share, respectively.

During the three and nine months ended September 30, 2025 and 2024, we reflected the applicable excise tax on share repurchases in Additional paid-in capital as part of the cost basis of the stock repurchased and recorded a corresponding liability in Accrued liabilities on the accompanying unaudited consolidated balance sheets.

During the three months ended March 31, 2026 and 2025, our Board of Directors approved, and we paid, a quarterly cash dividend on common stock of $ 0.48 and $ 0.43 per share, respectively.

During the three months ended March 31, 2026 and 2025, we reflected the applicable excise tax on share repurchases in Additional paid-in capital as part of the cost basis of the stock repurchased and recorded a corresponding liability in Accrued and other liabilities on the accompanying unaudited consolidated balance sheets.

NOTE 11 — STOCK BASED AND DEFERRED COMPENSATION

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The 2018 Plan authorizes awards to officers, key employees, non-employee directors and consultants.

The 2018 Plan authorizes 14,800,000 shares of stock to be awarded, of which 2,009,685 shares remain available for grant at September 30, 2025.

The 2018 Plan authorizes 14,800,000 shares of stock to be awarded, of which 1,650,007 shares remain available for grant at March 31, 2026.

We believe that such awards provide a means of long-term compensation to attract and retain qualified employees and better align the interests of our employees with those of our stockholders.

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Below is a summary of stock-based compensation expense and stock award activity (dollars in thousands):

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

2025 2024 2025 2024

Three Months Ended March 31,

Stock-based compensation expense $ 5,860 $ 6,325

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The following table includes additional information regarding our stock compensation plan (dollars in thousands):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Unrecognized stock-based compensation cost $ 44,160 $ 30,419

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We do not currently offer a contribution match on the Deferred Compensation Plan.

All contributions to the plan to date have been funded by the employees and, therefore, we have no associated expense related to the Deferred Compensation Plan for the three and nine months ended September 30, 2025 or 2024, other than minor administrative costs.

All contributions to the plan to date have been funded by the employees and, therefore, we have no associated expense related to the Deferred Compensation Plan for the three months ended March 31, 2026 or 2025, other than minor administrative costs.

NOTE 12 — INCOME TAXES

Components of the provision for income taxes are as follows (in thousands):

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

2025 2024 2025 2024

Three Months Ended March 31,

Federal $ 13,826 $ 30,631

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Total $ 17,215 $ 37,353

The effective tax rate for the three and nine months ended September 30, 2025 was 22.6 % and 23.4 %, respectively, and for the three and nine months ended September 30, 2024 was 21.6 % and 21.5 %, respectively.

The increase in the effective tax

rate for the three and nine months ended September 30, 2025 reflects fewer homes qualifying for the §45L energy-efficient homes federal tax credit under the Internal Revenue Code ("IRC") enacted in the Inflation Reduction Act ("IRA") due to higher construction thresholds required to earn these tax credits beginning in 2025.

At September 30, 2025 and December 31, 2024, we have no unrecognized tax benefits.

The effective tax rate for the three months ended March 31, 2026 and 2025 was 23.7 % and 23.3 %, respectively.

At March 31, 2026 and December 31, 2025, we have no unrecognized tax benefits.

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

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This evaluation considers, among other matters, the nature, frequency and severity of cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, experiences with operating losses and experiences of utilizing tax credit carry forwards and tax planning alternatives.

We have no NOLs or credit carryovers, and determined that no valuation allowance on our deferred tax assets is necessary at September 30, 2025.

At September 30, 2025, we had no income taxes payable and $ 16.2 million income taxes receivable.

The income taxes receivable primarily consists of federal and state estimated tax payments and energy tax credits in excess of income tax liability accrued at September 30, 2025.

We have accrued income taxes of $ 11.6 million recorded in Accrued liabilities on the accompanying unaudited consolidated balance sheets at September 30, 2025 that consists primarily of state franchise tax and federal excise tax.

We have no federal NOLs or credit carryovers, and determined that no valuation allowance on our deferred tax assets is necessary at March 31, 2026.

At March 31, 2026, we had $ 2.2 million taxes payable and no income taxes receivable.

The taxes payable at March 31, 2026 primarily consists of income tax liability accrued in excess of federal and state estimated tax payments and energy tax credits.

We have accrued taxes of $ 13.2 million recorded in Accrued and other liabilities on the accompanying unaudited consolidated balance sheets at March 31, 2026 that consists primarily of state franchise tax and federal excise tax.

We conduct business and are subject to tax in the U.S.

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federal, state, or local income tax examinations by taxing authorities for years prior to 2021.

We do not have any Federal or state income tax examinations pending resolution at this time.

On July 4, 2025, the President signed into law the One Big Beautiful Bill Act (“OBBBA”), which includes several significant corporate tax changes.

The legislation modifies or extends provisions originally enacted under the Tax Cuts and Jobs Act of 2017, including but not limited to the reinstatement of immediate expensing for research and development expenditures and the restoration of 100% bonus depreciation for qualified property.

In addition, OBBBA introduces new provisions, including the repeal of the §45L energy-efficient home credit for homes acquired after June 30, 2026, and a new 1% floor on charitable contribution deductions.

We have incorporated the effective changes into our provision and continue to evaluate the full impact of the legislation.

However, we do not expect the legislative changes to have a material effect on our effective tax rate for the year ending December 31, 2025.

We have no federal tax examinations pending resolution at this time, and one state income tax examination covering various years pending resolution at this time.

NOTE 13 — SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

The following table presents certain supplemental cash flow information (in thousands):

Nine Months Ended September 30,

Three Months Ended March 31,

Cash paid during the year for:

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Real estate acquired through notes payable $ 10,695 $ 7,990

ROU assets obtained in exchange for new operating lease obligations $ 12,172 $ 9,139

Non-cash investing and financing activities:

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As defined in ASC 280-10, Segment Reporting , we have twelve homebuilding operating segments.

The homebuilding segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes and providing warranty and customer

The homebuilding segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes and providing warranty and customer services.

We aggregate our homebuilding operating segments into reporting segments based on similar long-term economic characteristics and geographical proximity.

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Alabama, Florida, Georgia, Mississippi, North Carolina, and South Carolina

We define our segments based on the way in which internally reported financial information is regularly provided and reviewed by the CODM to analyze financial performance, make decisions, and allocate resources.

We define our segments based on the way in which internally reported financial information is regularly provided and reviewed by the Chief Operating Decision Maker ("CODM") to analyze financial performance, make decisions, and allocate resources.

Our CODM is the chief executive officer.

The CODM’s evaluation of the homebuilding segment performance is based on segment home closing revenue, home closing gross profit and gross margin, total gross profit, commissions and other sales costs, general and administrative expenses incurred by or allocated to each segment, including impairments, and operating income.

The CODM uses these performance metrics predominantly in the annual budget and forecasting process and considers budget-to-actual variances on a quarterly basis for these measures when making decisions about the allocation of operating and capital resources to each segment.

The CODM’s evaluation of the homebuilding segment performance is based on segment home closing revenue, home closing gross profit and gross margin, total closing gross profit, commissions and other sales costs, general and administrative expenses incurred by or allocated to each segment, including impairments, and operating income.

The CODM uses these performance metrics predominantly in the annual budget and forecasting process

and considers budget-to-actual variances on a quarterly basis for these measures when making decisions about the allocation of operating and capital resources to each segment.

The CODM also uses these data points to assess the performance of each segment by comparing the results of each segment with one another and in determining the compensation of certain employees.

The CODM also reviews financial services profits and losses to evaluate the performance of the financial services segment and make decisions about allocation of resources and financial services related product offerings.

Effective January 1, 2025, we realigned our internal organizational structure and resources following continued growth and recent entry into new markets.

Prior period balances have been retroactively adjusted to reflect this reclassification.

Each reportable segment follows the same accounting policies described in Note 1, “Organization and Basis of Presentation.” Operating results for each segment may not be indicative of the results for such segment had it been an independent, stand-alone entity for the periods presented.

The following tables provide financial information about our reportable segments and Corporate and other categories (in thousands):

Three Months Ended September 30, 2025

Three Months Ended March 31, 2026

West Central East Total

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(1) Balance consists primarily of corporate costs and shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.

Three Months Ended September 30, 2024

West Central East Total

Home closing revenue $ 594,509 $ 484,739 $ 506,536 $ 1,585,784

Land closing revenue — 2,125 540 2,665

Total closing revenue 594,509 486,864 507,076 1,588,449

Cost of home closings $ 456,171 $ 360,413 $ 376,635 $ 1,193,219

Cost of land closings — 1,480 505 1,985

Total cost of closings 456,171 361,893 377,140 1,195,204

Home closing gross profit 138,338 124,326 129,901 392,565

Land closing gross profit — 645 35 680

Total closing gross profit 138,338 124,971 129,936 393,245

Home closing gross margin 23.3 % 25.6 % 25.6 % 24.8 %

Commissions and other sales costs 31,235 33,664 32,999 97,898

General and administrative expenses 13,212 12,658 15,261 41,131

Homebuilding segment operating income 93,891 78,649 81,676 254,216

Financial services segment profit 3,101

Corporate and unallocated costs (1) ( 18,067 )

Interest expense —

Other income, net 10,682

Earnings before income taxes $ 249,932

(1) Balance consists primarily of corporate costs and shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.

Nine Months Ended September 30, 2025

West Central East Total

Home closing revenue $ 1,449,499 $ 1,336,048 $ 1,571,601 $ 4,357,148

Land closing revenue 691 9,740 29,335 39,766

Total closing revenue 1,450,190 1,345,788 1,600,936 4,396,914

Cost of home closings 1,147,619 1,043,916 1,261,678 3,453,213

Cost of land closings 142 10,439 26,547 37,128

Total cost of closings 1,147,761 1,054,355 1,288,225 3,490,341

Home closing gross profit 301,880 292,132 309,923 903,935

Land closing gross profit/(loss) 549 ( 699 ) 2,788 2,638

Total closing gross profit 302,429 291,433 312,711 906,573

Home closing gross margin 20.8 % 21.9 % 19.7 % 20.7 %

Commissions and other sales costs 85,973 102,500 114,799 303,272

General and administrative expenses 39,951 37,236 53,817 131,004

Homebuilding segment operating income 176,505 151,697 144,095 472,297

Financial services segment profit 13,654

Corporate and unallocated costs (1) ( 32,963 )

Interest expense —

Other income, net 28,479

Earnings before income taxes $ 481,467

(1) Balance consists primarily of corporate costs and shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.

Nine Months Ended September 30, 2024

Three Months Ended March 31, 2025

West Central East Total

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Other income, net 9,498

Loss on early extinguishment of debt ( 631 )

Earnings before income taxes $ 160,159

(1) Balance consists primarily of corporate costs and shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.

At September 30, 2025

At March 31, 2026

West Central East Financial Services Corporate and

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Total assets $ 1,864,718 $ 2,050,606 $ 2,719,700 $ 2,888 $ 916,699 $ 7,554,611

(1) Balance consists primarily of cash and cash equivalents, prepaids and other assets, and property and equipment, net .

(2) Balance consists primarily of cash and cash equivalents, development reimbursements from local municipalities, prepaids and other assets, and goodwill (see Note 9).

(3) Balance consists primarily of cash and cash equivalents, goodwill (see Note 9), and prepaids and other assets.

(4) Balance consists primarily of cash and cash equivalents, deferred tax assets, net and prepaids and other assets.

(1) Balance consists primarily of prepaid expenses and other assets and property and equipment, net.

(2) Balance consists primarily of development reimbursements from local municipalities, prepaid expenses and other assets, and cash and cash equivalents.

(3) Balance consists primarily of cash and cash equivalents, goodwill (see Note 9), and prepaid expenses and other assets.

(4) Balance consists primarily of cash and cash equivalents, prepaids and other assets, and deferred tax assets.

At December 31, 2025

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Total assets $ 1,874,406 $ 2,084,358 $ 2,684,316 $ 2,342 $ 976,865 $ 7,622,287

(1) Balance consists primarily of property and equipment, prepaid expenses and other assets, and development receivables.

(2) Balance consists primarily of development reimbursements from local municipalities, property and equipment, goodwill (see Note 9), and prepaid expenses and other assets .

(3) Balance consists primarily of cash and cash equivalents, goodwill (see Note 9), and prepaids and other assets .

(4) Balance consists primarily of cash and cash equivalents, deferred tax assets, net and prepaids and other assets .

(1) Balance consists primarily of property and equipment, net, prepaid expenses and other assets, and development receivables.

(2) Balance consists primarily of development reimbursements from local municipalities, property and equipment, net, goodwill (see Note 9), and prepaid expenses and other assets .

(3) Balance consists primarily of prepaid expenses and other assets, goodwill (see Note 9), and property and equipment, net .

(4) Balance consists primarily of cash and cash equivalents, prepaids and other assets, and deferred tax assets .

NOTE 15 — COMMITMENTS AND CONTINGENCIES

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Historically, most disputes regarding warranty claims are resolved prior to litigation.

We believe there are no pending legal or warranty matters as of September 30, 2025 that could have a material adverse impact upon our consolidated financial condition, results of operations or cash flows that have not been sufficiently reserved.

We believe there are no pending legal or warranty matters as of March 31, 2026 that could have a material adverse impact upon our consolidated financial condition, results of operations or cash flows that have not been sufficiently reserved.

We have case specific reserves within our $ 26.0 million of total Warranty reserves related to alleged stucco defects in certain homes we constructed predominantly between 2015 and 2019.

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Due to the degree of judgment and the potential for variability in our underlying assumptions and data, as we obtain additional information, we may revise our estimate and thus our related reserves.

As of September 30, 2025, after considering potential recoveries from the consultants and contractors involved and their insurers and the potential recovery under our general liability insurance policies, we did not adjust such reserves and we believe our reserves are sufficient to cover the above mentioned matters.

As of March 31, 2026, after considering potential recoveries from the consultants and contractors involved and their insurers and the potential recovery under our general liability insurance policies, we believe our reserves are sufficient to cover the above mentioned matters.

See Note 1 for information related to our warranty obligations.

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Forward-looking statements in this Quarterly Report may include statements concerning our belief that we have sufficient liquidity;

our goals, strategies and strategic initiatives including our 60-day closing ready commitment, our use of interest rate buy-downs and other financing incentives, our partnership with external realtors, and the anticipated benefits relating thereto;

our goals, strategies and strategic initiatives including our use of interest rate buy-downs and other financing incentives, our spec and move-in ready strategy, our partnership with external realtors, and the anticipated benefits relating thereto;

our intentions and the expected benefits and advantages of our product and land positioning strategies, including with respect to our focus on the first-time and first move-up home buyer and housing demand for affordable homes;

5 unchanged sentences

our non-use of derivative financial instruments;

expectations regarding our industry and our business for the remainder of 2025 and beyond;

expectations regarding our industry and our business for the remainder of 2026;

the demand for and the pricing of our homes;

7 unchanged sentences

the sources and sufficiency of our capital resources to support our business strategy;

the sufficiency of our land pipeline;

the impact of new accounting standards and changes in accounting estimates;

5 unchanged sentences

the cost of materials used to develop communities and construct homes;

shortages in the availability and cost of subcontract labor;

legislation related to tariffs;

cancellation rates;

supply chain and labor constraints;

shortages in the availability and cost of subcontract labor;

the ability of our potential buyers to sell their existing homes;

our ability to acquire and develop lots may be negatively impacted if we are unable to obtain performance and surety bonds;

the adverse effect of slow absorption rates;

legislation related to tariffs;

our ability to acquire and develop lots may be negatively impacted if we are unable to obtain performance and surety bonds;

impairments of our real estate inventory;

10 unchanged sentences

our limited geographic diversification;

sustainability matters and disclosure;

our exposure to information technology failures and security breaches and the impact thereof;

13 unchanged sentences

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