Dec 16 (Reuters) - U.S. homebuilder Lennar missed Wall Street's estimates for fourth-quarter profit on Tuesday, as affordability pressures continued to weigh on homebuying demand, sending the company's shares down more than 4% in after-hours trading.
Co-CEO Stuart Miller said that while interest rates edged lower during the reported quarter, the housing market remained under pressure as affordability constraints persisted and consumer confidence stayed weak.
"Despite the added pressure of a six-week
government shutdown, we continued to build and sell homes, adapting as needed to changing market conditions," he said.
The Miami, Florida-based company reported a fourth-quarter profit of $1.93 per share, below analysts' estimates of $2.22 per share, according to data complied by LSEG.
Higher interest rates have strained affordability and weighed on U.S. homebuilders' earnings in recent quarters, further compounded by renewed cost uncertainty tied to tariffs on lumber and other key building materials.
"While affordability and consumer confidence have remained challenging as interest rates moderated, we have focused on adapting to a new normal as the market finds its footing," Miller said.
Lennar said it expects first-quarter 2026 deliveries of 17,000 to 18,000 homes and home sales gross margin of 15% to 16%. In the quarter ended November 30, the company reported a 17% home sales gross margin.
It expects to deliver a total of 85,000 homes in 2026.
Lennar continues to see margin compression as it leans on sales sweeteners - such as mortgage-rate buydowns - and contends with cost adjustments in a softening demand environment.
The second-largest U.S. homebuilder by sales reported quarterly revenue of $9.37 billion, above analysts' average estimate of $9.02 billion.
(Reporting by Abhinav Parmar in Bengaluru; Editing by Shailesh Kuber)
