Toll Brothers Q4 Results: Revenue Up, 2026 Guidance Cautious

Toll Brothers, Inc. (TOL) reported Q4 results in a press release on Dec. 8, 2025, showing higher home-sales revenue and deliveries but lower earnings and margins. The company issued cautious FY 2026 guidance for deliveries and margins, which management said reflects soft demand across many markets.

Quarter and Full-Year Results

For the quarter ended Oct. 31, 2025, Toll Brothers recorded home-sales revenue of $3.4 billion on 3,443 units. Net income was $447 million, with diluted earnings per share of $4.58. Home-sales gross margin stood at 25.5%, while adjusted home-sales gross margin, excluding interest and write-downs, was 27.1%. Income from operations totaled $564 million, or 16.5% of total revenues.

Net signed contracts reached $2.5 billion on 2,598 units, averaging about six signed contracts per community. The quarter-end backlog was $5.5 billion across 4,647 units. Cancellations accounted for 4.3% of the beginning-quarter backlog and 8.3% of signed contracts during the period.

For the full year ended Oct. 31, 2025, home-sales revenue rose to $10.8 billion on 11,292 units. Net income totaled $1.4 billion, with diluted EPS of $13.49 and an adjusted home-sales gross margin of 27.3%.

Guidance and Capital Position

Toll Brothers forecast full-year FY 2026 deliveries of 10,300 to 10,700 units, with an average delivered price between $970,000 and $990,000. The company expects an adjusted home-sales gross margin of 26.0% and selling, general, and administrative expenses (SG&A) at 10.3% of home-sales revenues. It anticipates ending the year with 480 to 490 communities, other income of $130 million, and a tax rate of 25.5%. First-quarter deliveries are projected at 1,800 to 1,900 units, with an adjusted home-sales gross margin of 26.3%.

Management attributed the cautious outlook to weaker order trends and a smaller backlog, citing soft demand across many markets.

At Oct. 31, 2025, the company held $1.3 billion in cash and cash equivalents. Availability under its senior unsecured revolving credit facility was $2.2 billion of a $2.4 billion total. Net debt-to-capital (non-GAAP) stood at 15.3%. Toll Brothers returned approximately $750 million to shareholders in FY 2025 through share repurchases and dividends. In Q4, it repurchased about 1.8 million shares for $249 million at an average price of $139.39 and paid a quarterly dividend of $0.25 per share on Oct. 24, 2025.