What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-02-06 compared with 2024-02-05 · 151 added, 146 removed, 849 unchanged (26% of the section changed)

53 unchanged sentences

Equity income from unconsolidated entities, net 44,201 4,561 50,680

Gain (loss) on debt retirement 663 — ( 61,469 )

Other income (expense), net 61,749 37,863 ( 64,398 )

32 unchanged sentences

Shareholders' equity, December 31, 2021 249,326 $ 2,493 $ 3,290,791 $ ( 45 ) $ 4,196,276 $ 7,489,515

Stock option exercises 1 — 11 — — 11

Share issuances 676 7 6,024 — — 6,031

9 unchanged sentences

Share repurchases ( 13,793 ) ( 138 ) — — ( 999,862 ) ( 1,000,000 )

Excise tax on share repurchases — — — — ( 9,691 ) ( 9,691 )

Cash paid for shares withheld for taxes — — — — ( 11,991 ) ( 11,991 )

1 unchanged sentence

Net income — — — — 2,602,372 2,602,372

Other comprehensive income — — — 45 — 45

Shareholders' equity, December 31, 2023 212,558 $ 2,126 $ 3,368,407 $ — $ 7,012,724 $ 10,383,257

18 unchanged sentences

Land-related charges 34,572 43,115 66,656

(Gain) loss on debt retirement ( 663 ) — 61,469

Depreciation and amortization 89,162 80,824 70,918

24 unchanged sentences

Payments related to consolidated inventory not owned ( 105,787 ) ( 76,303 ) ( 5,915 )

Stock option exercises — — 11

Share repurchases ( 1,199,999 ) ( 1,000,000 ) ( 1,074,673 )

Excise tax on share repurchases ( 9,691 ) — —

Cash paid for shares withheld for taxes ( 18,597 ) ( 11,991 ) ( 14,326 )

26 unchanged sentences

Actual results could differ from those estimates.

Reclassifications

Effective with our first quarter 2023 reporting, we reclassified our closing cost incentives provided to customers, including seller-paid financing costs, from home sale cost of revenues to home sale revenues.

All prior period amounts have been reclassified to conform to the current presentation.

As a result, all sales incentives provided to customers are classified as a reduction of home sale revenues.

This reclassification had the effect of reducing both home sale revenues and home sale cost of revenues by the amount of such closing cost incentives, which totaled $ 226.0 million and $ 189.9 million for the years ended December 31, 2022 and 2021, respectively.

Subsequent events

12 unchanged sentences

We defer the recognition of profits from such activities until the time we ultimately sell the related land.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We evaluate our investments in unconsolidated entities for recoverability in accordance with ASC 323, “Investments – Equity Method and Joint Ventures”.

2 unchanged sentences

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

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Intangible assets

1 unchanged sentence

We assess goodwill for impairment annually in the fourth quarter and if events or changes in circumstances indicate the carrying amount may not be recoverable.

Intangible assets consist of primarily of tradenames acquired in connection with acquisitions and totaled $ 56.3 million, net of accumulated amortization of $ 98.2 million, at December 31, 2023, and $ 66.9 million, net of accumulated amortization of $ 87.7 million, at December 31, 2022.

Intangible assets consist primarily of tradenames acquired in connection with acquisitions and totaled $ 46.3 million, net of accumulated amortization of $ 108.3 million, at December 31, 2024, and $ 56.3 million, net of accumulated amortization of $ 98.2 million, at December 31, 2023.

Such tradenames are generally being amortized over 20-year lives.

14 unchanged sentences

Advertising costs are expensed to selling, general, and administrative expense as incurred and totaled $ 74.6 million, $ 57.5 million, and $ 61.6 million, in 2024, 2023, and 2022, respectively.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Employee benefits

8 unchanged sentences

( 10,034 ) ( 10,538 ) ( 11,118 )

Gain (loss) on debt retirement ( 222 ) 663 —

Interest income 59,486 61,533 1,971

Interest expense ( 479 ) ( 469 ) ( 284 )

Miscellaneous, net 10,186 8,592 7,724

Miscellaneous, net (a)

31,264 10,186 8,592

Total other income (expense), net $ 61,749 $ 37,863 $ ( 64,398 )

(a) Includes a gain of $ 17.5 million in 2024 related to the sale of a non-homebuilding property.

Earnings per share

2 unchanged sentences

Anti-dilutive shares were immaterial in 2024, 2023, and 2022.

In accordance with ASC 260 "Earnings Per Share", the two-class method determines earnings per share for each class of common share and participating securities according to an earnings allocation formula that adjusts the Numerator for dividends or dividend equivalents and participation rights in undistributed earnings.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In accordance with Accounting Standards Codification ("ASC") 260, "Earnings Per Share", the two-class method determines earnings per share for each class of common stock and participating securities according to an earnings allocation formula that adjusts the Numerator for dividends or dividend equivalents and participation rights in undistributed earnings.

Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and, therefore, are included in computing earnings per share pursuant to the two-class method.

Our outstanding restricted share units and deferred shares are considered participating securities .

The following table presents a reconciliation of the Numerator used in our earnings per common share calculation ($000's omitted):

December 31, 2023 December 31, 2022 December 31, 2021

A decreasing number of our outstanding restricted share units are considered participating securities such that there was no impact for the year ended December 31, 2024.

The following table presents a reconciliation of the Numerator used in the earnings per share calculation for the years ended December 31, 2023 and 2022 ($000's omitted):

December 31, 2023 December 31, 2022

Net income $ 2,602,372 $ 2,617,317

5 unchanged sentences

Numerator for diluted earnings per share $ 2,592,938 $ 2,601,242

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Share-based compensation

17 unchanged sentences

Interest and penalties related to income taxes and unrecognized tax benefits are recognized as a component of income tax expense (benefit).

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Revenue recognition

10 unchanged sentences

Expected gains and losses from the sale of residential mortgage loans and their related servicing rights are included in the measurement of interest rate lock commitments ("IRLCs") that are accounted for at fair value through Financial Services revenues at the time of commitment.

Subsequent changes in the fair value of IRLCs and residential mortgage available for sale are reflected in Financial Services revenues as they occur.

Subsequent changes in the fair value of IRLCs and residential mortgage loans available for sale are reflected in Financial Services revenues as they occur.

Interest income is accrued from the date a mortgage loan is originated until the loan is sold.

1 unchanged sentence

Servicing fees are based on a contractual percentage of the outstanding principal balance and are credited to income when related mortgage payments are received.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Revenues associated with our title operations are recognized as closing services are rendered and title insurance policies are issued, both of which generally occur as each home is closed.

3 unchanged sentences

Sales incentives

Sales incentives primarily relate to discounts on the selling price of the home, payment of closing costs, or free products or services offered to the customer.

Sales incentives are recorded as a reduction of home sale revenues.

Sales incentives primarily relate to discounts on the selling price of the home, payment of closing costs, including mortgage interest rate buydowns, or free products or services offered to the customer.

Sales incentives are recorded as a reduction of home sale revenues at the home closing date.

Inventory and cost of revenues

10 unchanged sentences

The construction cost of the home includes amounts paid through the closing date of the home, plus an accrual for costs incurred but not yet paid.

Total community land acquisition and development costs are based on an analysis of budgeted costs compared with actual costs incurred to date and estimates to complete.

Total community land acquisition and development costs are based on an analysis of budgeted costs compared with actual costs incurred to date and

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

estimates to complete.

The development cycles for our communities range from under one year to in excess of ten years for certain master planned communities.

10 unchanged sentences

Warranty liabilities

Home buyers are provided with a limited warranty against certain building defects, including a one-year comprehensive limited warranty and coverage for certain other aspects of the home's construction and operating systems for periods of up to (and in

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

limited instances exceeding) 10 years.

Homebuyers are provided with a limited warranty against certain building defects, including a one-year comprehensive limited warranty and coverage for certain other aspects of the home's construction and operating systems for periods of up to (and in limited instances exceeding) 10 years.

We estimate the costs to be incurred under these warranties and record a liability in the amount of such costs at the time revenue is recognized (see Note 11 ).

6 unchanged sentences

Adjustments to estimated reserves are recorded in the period in which the change in estimate occurs.

Costs associated with our insurance programs are classified within selling, general, and administrative expenses.

In certain instances, we have the ability to recover a portion of our costs under various insurance policies or from our subcontractors or other third parties.

2 unchanged sentences

Residential mortgage loans available-for-sale

Substantially all of the loans originated by us and their related servicing rights are sold in the secondary mortgage market within a short period of time after origination, generally within 30 days.

Substantially all of the loans originated by us and their related servicing rights are sold in secondary markets within a short period of time after origination, generally within 30 days.

In accordance with ASC 825, “Financial Instruments”, we use the fair value option to record residential mortgage loans available-for-sale.

5 unchanged sentences

At December 31, 2024 and 2023, residential mortgage loans available-for-sale had an aggregate fair value of $ 629.6 million and $ 516.1 million, respectively, and an aggregate outstanding principal balance of $ 645.7 million and $ 508.5 million, respectively.

These changes in fair value were substantially offset by changes in fair value of the corresponding derivative instruments.

These changes

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

in fair value were substantially offset by changes in fair value of the corresponding derivative instruments.

Net gains from the sale of mortgages during 2024, 2023, and 2022 were $ 235.1 million, $ 149.8 million, and $ 157.3 million, respectively, and have been included in Financial Services revenues .

13 unchanged sentences

At December 31, 2024 and 2023, we had aggregate IRLCs of $ 469.4 million and $ 404.7 million, respectively, which were originated at interest rates prevailing at the date of commitment.

Since we can terminate a loan commitment if the borrower does not comply with the terms of the

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

contract, and some loan commitments may expire without being drawn upon, these commitments do not necessarily represent future cash requirements.

Since we can terminate a loan commitment if the borrower does not comply with the terms of the contract, and some loan commitments may expire without being drawn upon, these commitments do not necessarily represent future cash requirements.

We evaluate the creditworthiness of these transactions through our normal credit policies.

1 unchanged sentence

Forward contracts on mortgage-backed securities are the predominant derivative financial instruments we use to minimize market risk during the period from the time we extend an interest rate lock to a loan applicant until the time the loan is sold to an investor.

At December 31, 2023 and 2022, we had unexpired forward contracts of $ 745.0 million and $ 1.0 billion, respectively, and whole loan investor commitments of $ 207.9 million and $ 285.9 million, respectively.

At December 31, 2024 and 2023, we had unexpired forward contracts of $ 977.0 million and $ 745.0 million, respectively, and whole loan investor commitments of $ 237.1 million and $ 207.9 million, respectively.

Changes in the fair value of IRLCs and other derivative financial instruments are recognized in Financial Services revenues, and the fair values are reflected in other assets or other liabilities, as applicable.

9 unchanged sentences

$ 14,735 $ 16,969 $ 4,060 $ 27,657

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Credit losses

5 unchanged sentences

New accounting pronouncements

In 2023, we adopted ASU 2020-04, "Reference Rate Reform (Topic 848)", as amended by ASU 2021-01 in January 2021, which provides optional expedients and exceptions for applying U.S.

GAAP to contracts, hedging relationships, and other transactions affected by the cessation of the London Interbank Offered Rate (LIBOR) or by another reference rate expected to be discontinued.

Our adoption of ASU 2020-04 did not have a material impact on the Company's condensed consolidated financial statements.

In November 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-07, "Segment Reporting (Topic 280):

In 2024, we adopted ASU 2023-07, "Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures" ("ASU 2023-07"), which requires expanded disclosure of significant segment expenses and other segment items on an annual and interim basis.

ASU 2023-07 is effective for us for annual periods beginning after January 1, 2024 and interim periods beginning after January 1, 2025.

We are currently evaluating the impact ASU 2023-07 will have on our financial statement disclosures.

In December 2023, FASB issued ASU 2023-09, "Income Taxes (Topic 740):

Improvements to Income Tax Disclosures" ("ASU 2023-09"), which requires expanded disclosure of our income rate reconciliation and income taxes paid.

ASU 2023-09 is effective for us for annual periods beginning after January 1, 2025.

ASU 2023-09 is effective for us for annual periods beginning after December 31, 2024.

We are currently evaluating the impact ASU 2023-09 will have on our financial statement disclosures.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Inventory and land held for sale

In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses” ("ASU 2024-03"), which requires disaggregated disclosure of certain costs and expenses on an interim and annual basis in the notes to the financial statements.

ASU 2024-03 is effective for us for annual periods beginning after December 31, 2026.

We are currently evaluating the impact ASU 2024-03 will have on our financial statement disclosures.

Major components of inventory at December 31, 2024 and 2023 were ($000’s omitted):

14 unchanged sentences

Interest in inventory, end of period $ 139,960 $ 139,078 $ 137,262

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Land option agreements

11 unchanged sentences

The following provides a summary of our interests in land option agreements ($000’s omitted):

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

December 31, 2024 December 31, 2023

21 unchanged sentences

For reporting purposes, our Homebuilding operations are aggregated into six reportable segments:

Connecticut, Maryland, Massachusetts, New Jersey, Pennsylvania, Virginia

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Maryland, Massachusetts, New Jersey, Pennsylvania, Virginia

Georgia, North Carolina, South Carolina, Tennessee

5 unchanged sentences

Each reportable segment generally follows the same accounting policies described in Note 1 .

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In 2024, we adopted ASU 2023-07, which requires expanded disclosure of significant segment expenses and other segment items on an annual and interim basis.

The adoption of ASU 2023-07 impacted the presentation of the performance measures presented in the below tables.

Information for previous periods in the below tables conforms with the current year presentation.

Our Chief Executive Officer ("CEO"), who has been identified as the chief operating decision maker for the purposes of the following reportable segment disclosures, is regularly provided operating results of individual operating segments which comprise our reportable segments.

These operating results include key operating metrics which inform the CEO's decisions regarding allocation of resources and assessment of our overall operational performance.

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

Operating Data by Segment ($000’s omitted)

1 unchanged sentence

2024 2023 2022

Revenues (a) :

Northeast $ 1,068,199 $ 969,107 $ 1,062,764

4 unchanged sentences

West 3,933,430 3,182,947 3,436,741

Other homebuilding (a)

194,389 144,378 143,144

17,513,956 15,740,823 15,691,263

Financial Services 432,994 320,755 311,716

Consolidated revenues $ 17,946,950 $ 16,061,578 $ 16,002,979

Income before income taxes (a)(b) :

Cost of Revenues

Northeast $ ( 729,284 ) $ ( 665,616 ) $ ( 727,640 )

3 unchanged sentences

Texas ( 1,526,930 ) ( 1,434,639 ) ( 1,471,186 )

West ( 3,017,970 ) ( 2,476,076 ) ( 2,490,505 )

Other homebuilding (b)

( 270,505 ) ( 223,412 ) ( 268,731 )

Other homebuilding (d)

( 12,501,659 ) ( 11,154,813 ) ( 10,987,785 )

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Operating Data by Segment ($000’s omitted)

Years Ended December 31,

2024 2023 2022

Northeast $ ( 94,925 ) $ ( 85,666 ) $ ( 86,559 )

Southeast ( 287,274 ) ( 255,327 ) ( 251,062 )

Florida ( 427,392 ) ( 396,978 ) ( 354,284 )

Midwest ( 236,195 ) ( 196,159 ) ( 209,579 )

Texas ( 257,490 ) ( 224,434 ) ( 245,680 )

West ( 341,613 ) ( 284,392 ) ( 301,175 )

Other homebuilding (c)

323,613 130,314 67,117

( 1,321,276 ) ( 1,312,642 ) ( 1,381,222 )

Other Segment Items (d) :

Northeast $ ( 13,994 ) $ ( 7,317 ) $ ( 14,058 )

Southeast ( 13,571 ) ( 17,524 ) ( 34,223 )

Florida ( 3,578 ) ( 19,191 ) ( 35,341 )

Midwest ( 9,236 ) ( 12,688 ) ( 20,795 )

Texas ( 10,685 ) ( 9,189 ) ( 21,215 )

West ( 21,008 ) ( 42,486 ) ( 7,068 )

Other homebuilding (e)

176,975 151,102 117,772

104,903 42,707 ( 14,928 )

Financial Services ( 223,039 ) ( 187,563 ) ( 179,486 )

$ ( 118,136 ) $ ( 144,856 ) $ ( 194,414 )

Income (loss) before income taxes (f) :

Northeast $ 229,996 $ 210,508 $ 234,507

Southeast 631,527 603,843 671,482

Florida 1,121,311 1,193,481 915,462

Midwest 490,185 353,966 345,811

Texas 345,594 371,902 442,771

West 552,839 379,993 637,993

Other homebuilding 424,472 202,382 59,302

3,795,924 3,316,075 3,307,328

Financial Services 209,955 133,192 132,230

Consolidated income before income taxes $ 4,005,879 $ 3,449,267 $ 3,439,558

(a) All periods reflect the reclassification of closing cost incentives to home sale revenues from home sale cost of revenues ( Note 1 ).

(b) Includes certain land-related charges (see the following table and Note 2 ).

(d) Other homebuilding includes the amortization of intangible assets, amortization of capitalized interest, and other items not allocated to the operating segments.

Also included are insurance reserve reversals of $ 130.8 million, $ 65.0 million, and $ 81.1 million in 2023, 2022 and 2021, respectively, partially offset by a loss on debt retirement of $ 61.5 million in 2021 ( Note 5 ).

(a) Other Homebuilding includes revenues from land sales and construction services.

(b) Other Homebuilding includes cost of revenues related to land sales, construction services, and amortization of capitalized interest.

(c) Other Homebuilding includes insurance reserve reversals of $ 333.9 million, $ 130.8 million, and $ 65.0 million in 2024, 2023 and 2022, respectively (see Note 11 ).

Other Homebuilding also includes eliminations of corporate overhead allocated to the operating segments.

(d) Other Segment Items reflects other sources of income and expense, including internal capital charge allocations that are eliminated within Other Homebuilding.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(e) Other Homebuilding includes income from unconsolidated entities, interest, the amortization of intangible assets, and other items not allocated to the operating segments.

Other Homebuilding also includes a gain of $ 39.5 million in 2024 related to the sale of our minority interest in a joint venture.

(f) Includes certain land-related charges (see the following table and Note 2 ).

Also includes gains related to sales of individual properties of $ 17.5 million in Florida in 2024, $ 10.7 million in West in 2024, and $ 49.1 million.in West in 2022.

Operating Data by Segment ($000's omitted)

30 unchanged sentences

($000's omitted)

December 31, 2023

Construction Land Under

Development Raw Land Consolidated Inventory Not Owned Total

Inventory Total

Northeast $ 312,903 $ 337,130 $ 4,091 $ — $ 654,124 $ 775,316

Southeast 786,698 826,240 80,451 27,963 1,721,352 1,994,492

1,405,934 1,211,087 205,843 48,139 2,871,003 3,420,924

Midwest 621,144 685,139 14,265 3,472 1,324,020 1,476,166

Texas 634,574 721,032 101,394 40,948 1,497,948 1,686,609

West 1,473,617 1,688,498 190,082 — 3,352,197 3,752,089

Other homebuilding (b)

27,980 336,867 9,879 — 374,726 2,140,954

5,262,850 5,805,993 606,005 120,522 11,795,370 15,246,550

Financial Services — — — — — 840,500

$ 5,262,850 $ 5,805,993 $ 606,005 $ 120,522 $ 11,795,370 $ 16,087,050

December 31, 2022

Construction Land Under

Development Raw Land Consolidated Inventory Not Owned Total

Inventory Total

1 unchanged sentence

Southeast 2,006,958 2,298,692 1,796,815 1,994,492

1,417,657 1,081,836 125,253 51,889 2,676,635 3,195,091

Florida 3,246,588 3,676,910 2,917,327 3,274,328

Midwest 1,401,747 1,529,602 1,359,179 1,476,166

1 unchanged sentence

West 3,684,393 4,212,636 3,391,504 3,752,089

Other homebuilding (b)

Other homebuilding (a)

( 35,616 ) 1,934,728 103,037 2,287,550

2 unchanged sentences

$ 12,665,813 $ 17,363,763 $ 11,795,370 $ 16,087,050

(a) Florida includes goodwill of $ 28.6 million, net of cumulative impairment charges of $ 20.2 million.

(b) Other homebuilding primarily includes cash and equivalents, capitalized interest, intangibles, deferred tax assets, and other corporate items that are not allocated to the operating segments.

Other homebuilding also includes goodwill of $ 40.4 million.

(a) Other homebuilding primarily includes cash and equivalents, capitalized interest, intangibles, deferred tax assets, other corporate items that are not allocated to the operating segments, and eliminations of certain inventory not owned and land held for sale allocated to the operating segments.

Other homebuilding also includes goodwill of $ 68.9 million , net of cumulative impairment charges of $ 20.2 million at December 31, 2024 and 2023.

Investments in unconsolidated entities

5 unchanged sentences

We made capital contributions to our unconsolidated joint ventures of $ 16.0 million, $ 23.4 million, and $ 64.7 million in 2024, 2023, and 2022, respectively.

At December 31, 2023, aggregate outstanding debt of unconsolidated joint ventures was $ 73.5 million, of which $ 33.2 million related to one joint venture in which we have a 50% interest.

In connection with this loan, we and our joint venture partner

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

provided customary limited recourse guaranties in which our maximum financial loss exposure is limited to our pro rata share of the debt outstanding.

At December 31, 2024, aggregate outstanding debt of unconsolidated joint ventures was $ 31.1 million.

The timing of cash flows related to a joint venture and any related financing agreements varies by agreement.

2 unchanged sentences

Our maximum financial exposure related to joint ventures is unlikely to exceed the combined investment and limited recourse guaranty totals.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Our notes payable are summarized as follows ($000’s omitted):

22 unchanged sentences

The retirements in 2024 included open market repurchases of $ 193.4 million and $ 106.6 million of our unsecured senior notes scheduled to mature in 2026 and 2027, respectively.

The retirements in 2021 included a tender offer to retire $ 200.0 million and $ 100.0 million of our unsecured notes scheduled to mature in 2026 and 2027, respectively.

The retirement in 2021 resulted in a loss of $ 61.5 million that included the write-off of debt issuance costs, unamortized discounts and premiums, and transaction fees related to the repurchased debt and which is reflected in other income (expense), net.

Our total repurchases during the twelve months ended 2024, including open market repurchases, were $ 310.2 million.

Other notes payable

Other notes payable include non-recourse and limited recourse collateralized notes with third parties that totaled $ 35.8 million and $ 71.0 million at December 31, 2024 and 2023, respectively.

These notes have maturities ranging up to six years , are secured by the applicable land positions to which they relate, and generally have no recourse to any other assets.

These notes have maturities ranging up to five years , are secured by the applicable land positions to which they relate, and generally have no recourse to any other assets.

The stated interest rates on these notes range up to 5 %.

2 unchanged sentences

We maintain a revolving credit facility ("Revolving Credit Facility") maturing in June 2027 that has a maximum borrowing capacity of $ 1.3 billion and contains an uncommitted accordion feature that could increase the capacity to $ 1.8 billion, subject to certain conditions and availability of additional bank commitments.

The Revolving Credit Facility also provides for the issuance of letters of credit that reduce the available borrowing capacity under the Revolving Credit Facility, up to the

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

maximum borrowing capacity.

The Revolving Credit Facility also provides for the issuance of letters of credit that reduce the available borrowing capacity under the Revolving Credit Facility, up to the maximum borrowing capacity.

The interest rate on borrowings under the Revolving Credit Facility may be based on either the Secured Overnight Financing Rate or a base rate plus an applicable margin, as defined therein.

The Revolving Credit Facility contains financial covenants that require us to maintain a minimum Tangible Net Worth and a maximum Debt-to-Capitalization Ratio (as each term is defined in the Revolving Credit Facility).

As of December 31, 2023, we were in compliance with all covenants.

As of December 31, 2024, we were in compliance with all covenants and requirements.

Outstanding balances under the Revolving Credit Facility are guaranteed by certain of our wholly-owned subsidiaries.

1 unchanged sentence

At December 31, 2023, we had no borrowings outstanding, $ 312.7 million of letters of credit issued, and $ 937.3 million of remaining capacity under the Revolving Credit Facility.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Financial Services debt

In August 2023, Pulte Mortgage entered into a master repurchase agreement (the "Repurchase Agreement"), which matures on August 14, 2024.

The Repurchase Agreement replaced a substantially similar agreement that previously existed with different lenders.

The maximum aggregate commitment was $ 850.0 million during the seasonally high borrowing period from December 27, 2023 through January 15, 2024.

At all other times, the maximum aggregate commitment ranges from $ 600.0 million to $ 700.0 million.

Pulte Mortgage maintains a master repurchase agreement with third-party lenders entered into in August 2023 (the "Original Repurchase Agreement", and as amended, the "Repurchase Agreement") that matures on August 13, 2025.

The maximum aggregate commitment was $ 675.0 million at December 31, 2024 and decreased to $ 650.0 million at January 14, 2025, which continues until maturity.

The Repurchase Agreement also contains an accordion feature that could increase the commitment by $ 50.0 million above its active commitment level.

The purpose of the changes in capacity during the term of the agreement is to lower associated fees during seasonally lower volume periods of mortgage origination activity.

Borrowings under the Repurchase Agreement are secured by residential mortgage loans available-for-sale.

1 unchanged sentence

At December 31, 2024, Pulte Mortgage had $ 526.9 million outstanding at a weighted average interest rate of 6.13 %, and $ 148.1 million of remaining capacity under the Repurchase Agreement.

At December 31, 2022, Pulte Mortgage had $ 586.7 million outstanding at a weighted average interest rate of 5.39 % and $ 213.3 million of remaining capacity under the Repurchase Agreement.

Pulte Mortgage was in compliance with its covenants and requirements as of such dates.

At December 31, 2023, Pulte Mortgage had $ 499.6 million outstanding at a weighted average interest rate of 7.15 % and $ 350.4 million of remaining capacity under the Original Repurchase Agreement, as amended, replaced by the Repurchase Agreement.

Pulte Mortgage was in compliance with all of its covenants and requirements as of such dates.

Shareholders’ equity

We declared quarterly cash dividends totaling $ 171.4 million, $ 149.8 million, and $ 143.1 million in 2024, 2023, and 2022, respectively.

Under a share repurchase program authorized by our Board of Directors, we repurchased 13.8 million, 24.2 million, and 17.7 million shares in 2023, 2022, and 2021, respectively, for a total of $ 1.0 billion, $ 1.1 billion, and $ 897.3 million in 2023, 2022, and 2021, respectively.

On April 24, 2023, the Board of Directors increased our share repurchase authorization by $ 1.0 billion.

At December 31, 2023, we had remaining authorization to repurchase $ 382.9 million of common shares.

Under a share repurchase program authorized by our Board of Directors, we repurchased 10.1 million, 13.8 million, and 24.2 million shares in 2024, 2023, and 2022, respectively, for a total of $ 1.2 billion, $ 1.0 billion, and $ 1.1 billion in 2024, 2023, and 2022, respectively.

On January 29, 2024, the Board of Directors increased our share repurchase authorization by $ 1.5 billion.

Under our stock compensation plans, we accept shares as payment under certain conditions related to stock option exercises and vesting of restricted shares and share units, generally related to the payment of tax obligations.

At December 31, 2024, we had remaining authorization to repurchase $ 682.9 million of common shares.

On January 29, 2025, the Board of Directors increased our share repurchase authorization by an additional $ 1.5 billion.

Under our stock compensation plans, we accept shares as payment under certain conditions related to vesting of restricted shares and share units, generally related to the payment of tax obligations.

During 2024, 2023, and 2022, employees surrendered shares valued at $ 18.6 million, $ 12.0 million, and $ 14.3 million, respectively, under these plans.

52 unchanged sentences

Federal tax credits ( 1.1 ) ( 0.2 ) ( 0.9 )

Deferred tax asset valuation allowance — 0.4 ( 0.8 )

Other ( 0.5 ) 0.3 0.4

Effective rate 23.0 % 24.6 % 23.9 %

The effective tax rates differ from the federal statutory rate primarily due to state income tax expense, benefits associated with federal energy efficient home credits, and changes in valuation allowances relating to projected utilization of certain state net operating loss ("NOL") carryforwards.

The effective tax rates differ from the federal statutory rate primarily due to state income tax expense and benefits associated with various federal energy tax credits.

Deferred tax assets and liabilities reflect temporary differences arising from the different treatment of items for tax and accounting purposes.

27 unchanged sentences

We had $ 38.7 million and $ 58.2 million of gross unrecognized tax benefits at December 31, 2024 and 2023, respectively.

If recognized, $ 46.0 million and $ 18.7 million, respectively, of these

If recognized, $ 30.6 million and $ 46.0 million, respectively, of these amounts would impact our effective tax rate.

Additionally, we had accrued interest and penalties of $ 1.9 million and $ 6.3 million at December 31, 2024 and 2023, respectively.

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

amounts would impact our effective tax rate.

Additionally, we had accrued interest and penalties of $ 6.3 million and $ 4.1 million at December 31, 2023 and 2022, respectively.

We do not expect the total amount of gross unrecognized tax benefits to increase or decrease by a material amount within the next twelve months.

5 unchanged sentences

Increases related to positions taken during the current period — — 1,450

Decreases related to settlements with taxing authorities ( 1,994 ) — —

Decreases related to lapse of the applicable statute of limitations ( 71 ) ( 71 ) ( 71 )

5 unchanged sentences

The statute of limitations for our major tax jurisdictions generally remains open for examination for tax years 2020 to 2024.

We are under contract to purchase federal transferable tax credits that we expect to use to offset future federal income tax obligations totaling $ 222 million.

The timing of such purchases is intended to approximate the timing of our expected federal income tax obligations.

Fair value disclosures

23 unchanged sentences

Fair values for agency residential mortgage loans available-for-sale are determined based on quoted market prices for comparable instruments.

Fair values for non-agency residential mortgage loans available-for-sale are determined based on purchase commitments from whole loan investor.

Fair values for non-agency residential mortgage loans available-for-sale are determined based on purchase commitments from whole loan investors.

Fair values for IRLCs, including the value of servicing rights, and forward contracts on mortgage-backed securities are valued based on market prices for similar instruments.

46 unchanged sentences

$ 1,412,166 $ 1,645,690

$ 1,645,690 $ 1,685,202

(a) Other liabilities primarily include liabilities associated with property taxes, forward contracts on mortgage-backed securities, and other miscellaneous liabilities.

Commitments and contingencies

Loan origination liabilities

Our mortgage operations may be responsible for losses associated with mortgage loans originated and sold to investors in the event of errors or omissions relating to representations and warranties made by us that the loans met certain requirements, including representations as to underwriting standards, the existence of primary mortgage insurance, and the validity of certain borrower representations in connection with the loan.

If a loan is determined to be faulty, we either indemnify the investor for

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

potential future losses, repurchase the loan from the investor, or reimburse the investor's actual losses.

Reserves provided are reflected in Financial Services expenses, and liabilities related to these exposures totaled $ 10.5 million and $ 12.4 million at December 31, 2023 and 2022, respectively.

Given the unsettled claims, changes in values of underlying collateral over time, and other uncertainties regarding the ultimate resolution of known and potential claims, actual costs could differ from our current estimates.

Letters of credit and surety bonds

1 unchanged sentence

The majority of these letters of credit and surety bonds are in support of our land development and construction obligations to various municipalities, other government agencies, and utility companies related to the construction of roads, sewers, and other infrastructure.

We had outstanding letters of credit and surety bonds totaling $ 312.7 million and $ 2.4 billion, respectively, at December 31, 2023, and $ 303.4 million and $ 2.2 billion, respectively, at December 31, 2022.

We had outstanding letters of credit and surety bonds totaling $ 321.1 million and $ 2.9 billion, respectively, at December 31, 2024, and $ 312.7 million and

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

$ 2.4 billion, respectively, at December 31, 2023.

In the event any such letter of credit or surety bonds is drawn, we would be obligated to reimburse the issuer of the letter of credit or surety bond.

24 unchanged sentences

Warranty liabilities, end of period $ 130,538 $ 120,393 $ 108,348

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Self-insured risks

We maintain, and require our subcontractors to maintain, general liability insurance coverage.

We also maintain builders' risk, property, errors and omissions, workers compensation, and other business insurance coverage.

These insurance policies protect us against a portion of the risk of loss from claims.

We also maintain builders' risk, property, errors and omissions, workers compensation, and other business insurance coverages.

These insurance policies protect us against a portion of the risk of loss from potential claims.

However, we retain a significant portion of the overall risk for such claims either through our own self-insured per occurrence and aggregate retentions, deductibles, policies issued by our captive insurance subsidiaries, and any potential claims in excess of available insurance policy limits.

3 unchanged sentences

In certain instances, we may offer our subcontractors the opportunity to purchase general liability insurance through one of our captive insurance subsidiaries or participate in a project-specific insurance program.

Policies issued by our captive insurance subsidiaries represent self-insurance of these risks by us.

This self-insured exposure is limited by reinsurance policies that we purchase.

General liability coverage for the homebuilding industry is complex, and our coverage varies from policy year to policy year.

Our insurance coverage requires a per occurrence retention up to an overall aggregate amount.

Policies issued by our captive insurance subsidiaries represent self-insurance of these risks by us, limited by reinsurance policies that we purchase.

General liability

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

coverage for the homebuilding industry is complex, and our coverage varies from policy year to policy year.

Our insurance coverage requires a per occurrence retention as well as an overall aggregate amount.

Amounts paid to resolve insured claims apply to our per occurrence and aggregate retention obligations.

1 unchanged sentence

Our insurance policies, including the captive insurance subsidiaries' reinsurance policies, are maintained with highly-rated carriers for whom we believe counterparty default risk is not significant.

At any point in time, we are managing numerous individual claims related to general liability, property, errors and omission, workers compensation, and other business insurance coverage.

At any point in time, we are managing numerous individual claims related to general liability, property, errors and omission, workers compensation, and other business insurance coverages.

We reserve for costs associated with these claims (including expected claims management expenses) on an undiscounted basis at the time revenue is recognized for each home closing and evaluate the recorded liabilities based on actuarial analyses of our historical claims.

7 unchanged sentences

Volatility in both national and local housing market conditions may affect the frequency and cost of construction defect claims.

Additionally, IBNR estimates comprise the majority of our liability and are subject to a high degree of uncertainty due to a variety of factors, including changes in claims reporting and resolution patterns, third party recoveries, insurance industry practices, the regulatory environment, and legal precedent.

State regulations vary, but construction defect claims are reported and resolved over an extended time period often exceeding ten years.

Additionally, IBNR estimates comprise the substantial majority of our liability and are subject to a high degree of uncertainty due to a variety of factors, including changes in claims reporting and resolution patterns, third party recoveries, insurance industry practices, the regulatory environment, and legal precedent.

State regulations vary, but construction defect claims are typically reported and resolved over an extended time period often exceeding ten years.

Changes in the frequency and timing of reported claims and estimates of specific claim values can impact the underlying inputs and trends utilized in the actuarial analyses, which could have a material impact on the recorded reserves.

5 unchanged sentences

There were no material adjustments to individual claims.

Rather, the adjustments reflect an overall lower level of losses related to construction defect claims in recent years as compared with our previous experience.

Rather, the adjustments reflect an overall lower level of claims and related losses in recent years as compared with our previous experience.

We attribute the favorable experience in more recent years to a variety of factors, including improved construction techniques, rising home values, and increased participation from our subcontractors in resolving claims.

Costs associated with

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

our insurance programs are classified within selling, general, and administrative expenses.

The cumulative effect of these factors, as evidenced by the favorable claims experience for an extended period, resulted in our actuarial estimates placing less weight on older, higher cost policy years and relatively more weight on our more recent, lower cost policy years, which is the primary driver of the change in actuarial estimate in 2024.

Costs associated with our insurance programs are classified within selling, general, and administrative expenses.

Changes in these liabilities were as follows ($000's omitted):

6 unchanged sentences

Balance, end of period $ 267,474 $ 563,103 $ 635,857

PULTEGROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(a) Includes net changes in amounts expected to be recovered from our insurance carriers, which are recorded in other assets (see below).

Estimates of anticipated recoveries of our costs under various insurance policies or from subcontractors or other third parties are recorded when recovery is considered probable.

Such receivables are recorded in other assets and totaled $ 26.9 million and $ 43.7 million at December 31, 2023 and 2022, respectively.

The insurance receivables relate to costs incurred or to be incurred to perform corrective repairs, settle claims with customers, and other costs related to the continued progression of both known and anticipated future construction defect claims that we believe to be insured related to previously closed homes.

Given the complexity inherent with resolving construction defect claims in the homebuilding industry, there generally exists a significant lag between our payment of claims and our reimbursements from applicable insurance carriers or third parties.

Recoveries relate to costs incurred or to be incurred to perform corrective repairs, settle claims, and other costs related to both known and anticipated future construction defect claims that we believe to be insured related to previously closed homes.

Given the complexity inherent with resolving construction defect claims in the homebuilding industry, there generally exists a significant lag between our payment of claims and our recoveries from applicable insurance carriers or third parties.

We lease certain office space and equipment for use in our operations.

53 unchanged sentences

Auditing the Company’s IBNR reserve for construction defects is complex due to the significant measurement uncertainty associated with the estimate, the use of various actuarial methods, and management’s application of significant judgment.

In addition, the reserve estimate is sensitive to significant management assumptions, including the frequency and severity assumptions used in the computation of the IBNR reserve and loss development factors for reported claims.

In addition, the reserve estimate is sensitive to significant assumptions, including the frequency and severity assumptions used in the computation of the IBNR reserve.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s controls that address the risks of material misstatement relating to the measurement and valuation of the IBNR reserve.

10 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-K

Item 8. Financial Statements and Supplementary Data