Smith Douglas Homes Corp. released its second quarter 2025 results on August 6, 2025. The company reported home closings for the quarter came in above its stated guidance range, totaling 669 homes. Home closing gross margin was 23.2%, which was at the high end of the guidance range.
Home closing revenue increased by 1% year-over-year to $223.9 million. However, net income for the quarter decreased to $16.4 million, compared to $24.7 million in the prior year period. Diluted earnings per share were $0.26, down from $0.40 in Q2 2024.
Operationally, the company ended the second quarter with 57% more lots under control and 23% more new communities open compared to the same period last year. Net new home orders increased to 736 from 715 year-over-year. The cancellation rate improved to 10.0% from 11.8%.
The company's net debt-to-net book capitalization ratio stood at 12.1% at the end of the quarter. Management noted that new home sales continued to be uneven due to affordability constraints and macroeconomic concerns. They continue to use financing incentives to drive traffic and convert sales.
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