A U.S. homebuilder operating in 13 states, Beazer builds entry-level, move-up, and active-adult homes under its Gatherings® brand, with a focus on energy efficiency—its homes earn a very low HERS score and meet the DOE Zero Energy Ready standard. The name comes from a family of English stonemasons whose craft spanned nine generations; the U.S. firm was founded in 1985 when Britain's Beazer PLC bought Atlanta's Cohn Communities. Fun fact: the Beazers built their first home in 1890.
Beazer's gross margin ticked up to 12.8% but operating losses persisted as revenue fell 5.3%.
edged higher for the second straight quarter, but the company remained unprofitable. fell 5.3% to $516.3 million and the operating loss was $11.4 million as price concessions and a shift to lower-margin spec homes continued to weigh on results. The company is buying back stock and spending more on land, betting on a recovery that has not yet arrived.
Key takeaways
Homebuilding improved 90 sequentially to 13.6%, but excluding impairments and interest it fell 150 basis points to 16.9%, driven by higher price concessions and closing-cost incentives.
fell 5.3% to $516.3 million as home closings dropped 13.4% to 896 homes, partially offset by a 5.9% increase in the average selling price to $547,800.
Net new orders rose 4.5% to 900 homes, the first increase in at least five quarters, while the cancellation rate improved to 15.9% from 19.8% a year ago.
Section summaries
Management's Discussion and Analysis
Q3 FY2026 homebuilding revenue fell 8.3% to $490.9M on lower closings, while gross margin rose 10 bps to 13.6%.
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Homebuilding declined 8.3% to $490.9M, driven by a 13.4% drop in closings to 896 homes, partially offset by a 5.9% increase in ASP to $547.8K.
Homebuilding improved 10 to 13.6%, but excluding impairments and interest , it fell 150 bps to 16.9% due to higher price concessions and closing cost incentives.
The operating loss narrowed to $11.4 million from $19.0 million in the prior quarter, but compared to a $24.8 million profit a year ago, as rose to 14.1% of from 13.2%.
The company repurchased 1.0 million shares for $21.0 million, bringing year-to-date repurchases to $66.2 million, even as cash and equivalents fell to $124.6 million.
Land acquisition and development spending rose to $199.6 million from $153.8 million a year ago, while total controlled lots fell 11.9% to 24,489.
What changed
The Q2 FY2026 watch item on holding above the 10.2% Q1 trough was answered: gross margin rose to 12.8% in Q3, up from 11.9% in Q2, though the improvement came with a 150-basis-point decline in the underlying margin excluding impairments and interest.
The Q2 watch item on the sales pace was partially answered: the sales pace rose to 1.8 orders per community per month from 1.7 a year ago, a modest improvement but still well below the 2.4 rate from two years ago.
The Q2 watch item on cash and availability showed further pressure: cash fell to $124.6 million and available credit facility capacity dropped to $139.2 million, even as the company deployed another $21.0 million on share repurchases.
The Q2 watch item on community openings remains unresolved: total controlled lots fell 11.9% to 24,489, raising questions about the pace of progress toward the fiscal 2027 target of over 200 active communities.
What to watch
Whether the order growth of 4.5% continues into Q4 FY2026, confirming that the demand trough is behind the company or proving to be a one-quarter improvement.
The trajectory of the underlying homebuilding excluding impairments and interest, which fell 150 to 16.9%, to see whether price concessions and mix shifts continue to erode profitability even as reported margins improve.
The level of cash and availability at fiscal year-end, given that cash reserves fell to $124.6 million and the company has spent $66.2 million on share repurchases year-to-date while carrying substantial land option commitments.
The active community count at year-end, to assess whether the 11.9% decline in controlled lots is translating into a slowdown in new community openings that puts the fiscal 2027 target of over 200 communities at risk.
Net new orders rose 4.5% to 900, with the West up 7.9%, while the cancellation rate improved to 15.9% from 19.8%.
as a percentage of total increased to 14.1% from 13.2%, primarily due to lower homebuilding revenue, while total SG&A dollars remained relatively flat.
The company repurchased 1.0M shares for $21.0M, bringing year-to-date repurchases to $66.2M, and ended the quarter with $124.6M in cash and $139.2M in available capacity.
Land spend increased to $199.6M from $153.8M, while total controlled lots fell 11.9% to 24,489, with 60.0% of active lots controlled via option agreements.
Quantitative and Qualitative Disclosures About Market Risk
We are exposed to a number of market risks in the ordinary course of business. Our primary market risk exposure relates to fluctuations in interest rates. We do not believe that our exposure in this area is material to our cash flows or results of operations. As of June 30, 2026…
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We are exposed to a number of market risks in the ordinary course of business. Our primary market risk exposure relates to fluctuations in interest rates. We do not believe that our exposure in this area is material to our cash flows or results of operations. As of June 30, 2026, we had variable rate debt outstanding related to our Junior Subordinated Notes and outstanding borrowings under our Unsecured Facility totaling approximately $420.0 million. A one percent increase in the interest rate for these notes would result in an increase of our interest expense by approximately $4.4 million over the next twelve-month period. The estimated fair value of our fixed-rate debt as of June 30, 2026 was $1.00 billion, compared to a carrying amount of $989.1 million. The effect of a hypothetical one-percentage point decrease in our estimated discount rates would increase the estimated fair value of the fixed rate debt instruments from $1.00 billion to $1.04 billion as of June 30, 2026.
There have been no material changes to the risk factors we previously disclosed in our Annual Report on Form 10-K for the year ended September 30, 2025.
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There have been no material changes to the risk factors we previously disclosed in our Annual Report on Form 10-K for the year ended September 30, 2025.