KB Home reports mixed Q3 results amid rising mortgage rates

KB Home has reported third-quarter financial results that present a mixed picture of performance and market challenges. While one report indicates earnings per share of $1.05, exceeding the consensus estimate of $0.89, other analysts have adjusted their outlooks. Zacks Research lowered its Q3 2026 EPS estimate to $0.86 and maintains a “Strong Sell” rating on the stock.

Despite meeting revenue expectations of $1.30 billion, the company faces significant headwinds. Revenue decreased by 20 percent compared to the previous year, and the number of homes delivered fell by 19 percent to 2,732. Operating profit dropped from $131.2 million to $67.1 million, with margins sliding from 8.1 percent to 5.2 percent.

Company leadership, including CEO Robert McGibney and Executive Chairman Jeffrey Mezger, noted that rising mortgage rates and geopolitical uncertainty have worsened the environment, impacting buyer affordability. On a positive note, the company has returned to a predominantly built-to-order model, which accounted for nearly three-quarters of deliveries. The order backlog also saw its first increase in four years, rising 2 percent to 4,398 homes valued at $2.05 billion.