Earnings call transcript: TRI Pointe Homes Q3 2025 beats expectations

TRI Pointe Homes Inc. (TPH) reported strong financial results for Q3 2025, surpassing analysts' expectations with an earnings per share (EPS) of $0.71, compared to the forecasted $0.52, marking a 36.54% surprise. The company's revenue also exceeded forecasts, coming in at $817.3 million against an anticipated $736.2 million, reflecting an 11.02% surprise. Following the announcement, TRI Pointe Homes' stock saw a modest pre-market increase of 0.85%, with shares priced at $33.13.

Key Takeaways

• TRI Pointe Homes delivered a significant earnings beat with a 36.54% EPS surprise.
• Revenue for Q3 2025 outperformed expectations by over 11%.
• The company's stock showed a slight positive movement in pre-market trading.
• TRI Pointe Homes is expanding into new geographical markets, including Utah and Florida.

Company Performance

TRI Pointe Homes demonstrated robust performance in Q3 2025, delivering 1,217 homes at an average sales price of $672,000. The company's strategic focus on premium move-up buyers and geographical expansion into Utah, Florida, and the Coastal Carolinas contributed to its strong quarterly results. Despite soft market conditions and muted homebuyer confidence, TRI Pointe Homes maintained a steady absorption pace of 2.2 homes per community per month.

Financial Highlights

• Revenue: $817.3 million, exceeding forecasts by 11.02%
• Earnings per share: $0.71, surpassing expectations by 36.54%
• Adjusted homebuilding gross margin: 21.6%
• Adjusted net income: $62 million

Earnings vs. Forecast

TRI Pointe Homes' Q3 2025 EPS of $0.71 significantly outperformed the forecasted $0.52, resulting in a 36.54% surprise. This marks a notable achievement compared to previous quarters, reflecting effective cost management and strategic market positioning. The revenue surprise of 11.02% further underscores the company's strong performance this quarter.

Market Reaction

Following the earnings announcement, TRI Pointe Homes' stock experienced a minor pre-market increase of 0.85%, with shares trading at $33.13. Despite this positive movement, the stock remains below its 52-week high of $45.28. The modest stock reaction suggests that while investors are encouraged by the earnings beat, they remain cautious amid broader market trends and economic uncertainties.

Outlook & Guidance

Looking ahead, TRI Pointe Homes projects Q4 2025 deliveries between 1,200 and 1,400 homes, with an average sales price ranging from $690,000 to $700,000. The company aims to end 2025 with 155 communities and anticipates meaningful growth from new markets by 2027. TRI Pointe Homes is also targeting a community count growth of 10-15% in 2026.

Executive Commentary

Doug Bauer, CEO of TRI Pointe Homes, highlighted the company's focus on price over pace, stating, "Demand is very inelastic, and we're gonna continue to focus on price over pace." Bauer also emphasized the company's recognition as one of the Fortune 100 Best Companies to Work For in 2025, reflecting its strong corporate culture and employee satisfaction.

Risks and Challenges

• Soft market conditions and muted homebuyer confidence could impact future sales.
• Economic uncertainties and slow job growth may affect demand.
• Potential challenges in managing inventory and maintaining cost control.

Q&A

During the earnings call, analysts inquired about the company's order cadence and incentives, which stand at 8.2% of revenue. TRI Pointe Homes is focusing on maintaining consistent monthly order rates while preparing for potential affordable housing initiatives.

Full transcript - TRI Pointe Homes Inc (TPH) Q3 2025:

Conference Operator: Greetings, and welcome to the TRI Pointe Homes Third Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce David Lee, General Counsel at TRI Pointe Homes.

You may proceed.

David Lee, General Counsel, TRI Pointe Homes: Good morning and welcome to TRI Pointe Homes earnings conference call. Earlier this morning, the company released its financial results for the 2025. Documents detailing these results, including a slide deck, are available at ww.tripointhomes.com through the Investors link and under the Events and Presentations tab. Before the call begins, I would like to remind everyone that certain statements made on this call, which are not historical facts, including statements concerning future financial and operating performance, are forward looking statements that involve risks and uncertainties. A discussion of risks and uncertainties and other factors that could cause actual results to differ materially are detailed in the company's SEC filings.

Except as required by law, the company undertakes no duty to update these forward looking statements. Additionally, reconciliations of non GAAP financial measures discussed on this call to the most comparable GAAP measures can be accessed through TRI Pointe's website and in its SEC filings. Hosting the call today are Doug Bauer, the company's Chief Executive Officer Glenn Keeler, the company's Chief Financial Officer Tom Mitchell, the company's President and Chief Operating Officer and Linda Vemay, the company's Executive Vice President and Chief Marketing Officer. With that, I will now turn the call over to Doug.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Good morning and thank you for joining us today as we review TRI Pointe's results for the 2025. I want to begin by recognizing our entire TRI Pointe team. Their dedication and focus allowed us to deliver strong results in a period that continues to present challenges to the housing industry. In the third quarter, we exceeded the high end of our delivery guidance, closing $12.17 homes at an average sales price of $672,000 generating $817,000,000 in home sales revenue. Our adjusted homebuilding gross margin excluding $8,000,000 of inventory related charges, was 21.6%, while adjusted net income was $62,000,000 or $0.71 per diluted share.

We remain focused on creating long term shareholder value. During the quarter, we spent $51,000,000 repurchasing 1,500,000.0 shares, bringing our year to date total spend to $226,000,000 representing a total of 7,000,000 shares. This activity has reduced our share count by 7% year to date and by 47% since we initiated the program in 2016, underscoring our disciplined approach to enhancing shareholder returns. Additionally, we also strengthened our liquidity by increasing our term loan by 200,000,000 with optionality to extend the maturity into 2029. We believe this incremental leverage is prudent, supporting capital efficiency, funding for our community count growth and continued flexibility to return capital to our shareholders.

We ended the quarter with $1,600,000,000 in total liquidity, including $792,000,000 in cash and a debt to capital ratio of 25.1% and a net debt to net capital ratio of 8.7%. Market conditions remained soft throughout the third quarter. Homebuyer interest remained somewhat muted with lower confidence driven by slow job growth and broader economic uncertainty. However, we continue to see underlying demand homeownership among needs based buyers. We anticipate that home shoppers are preparing to reengage when conditions stabilize, leading to more normalized absorptions.

Our management team has successfully navigated multiple housing cycles, and we remain focused on near term execution while staying aligned with our long term growth strategy. In the short term, we are prioritizing inventory management, disciplined cost control and the sale of move in ready homes, while steadily increasing the mix of to be built homes over time. For long term success, we continue to invest in both our core and expansion markets, with a goal of scaling our operations, consistently growing community count and increasing book value per share to drive sustained shareholder returns. We are encouraged by the progress of our new market expansions in Utah, Florida and Coastal Carolinas. Development activity is well underway and strong local leadership teams are in place.

While initial contributions will be modest, we expect these divisions to generate meaningful growth beginning in 2027 and beyond as they gain scale. During the quarter, we are pleased to open our first two communities in Utah, a key milestone for that region. A cornerstone of our strategy is to invest in well located core land positions, close to employment centers, high performing schools and key amenities. We currently own or control over 32,000 lots, positioning us well for community count growth in the years ahead. We expect to end 2025 with approximately 155 communities.

And we anticipate growing our ending community count by 10% to 15% by the 2026. The majority of this growth will be driven by expansion in our Central And East Regions. This disciplined growth strategy enhances our operating scale, increases geographic diversification, and positions TRI Pointe for sustainable, profitable growth as demand improves and our expansion divisions mature. At TRI Pointe, our product is primarily targeted to premium move up buyers with financial strength, seeking better locations, larger homes, curated finishes and elevated lifestyles. This segment has demonstrated resilience even amid shifting market conditions, supported by strong income profiles, down credit and larger down payments.

And our backlog reflects this strength. Homebuyers financing through TRI Pointe Connect, our affiliated mortgage company, have average household income of $220,000 FICO score of seven fifty two, 78% loan to value ratio, and average debt to income level of 41%, consistent with recent quarters. These strong characteristics reinforce the financial stability and quality of our customer base and the durability of our future deliveries. As consumer confidence improves, we expect pent up demand to grow the pool of move up buyers attracted to our premium communities and design driven offerings that align with their lifestyle aspirations. Our premium brand, community locations and innovative product design continue to differentiate TRI Pointe in the marketplace.

We have the financial strength and operational discipline to invest through the cycle while returning capital to shareholders. Together, these strengths, along with an experienced management team, positions TRI Pointe to drive long term performance and value creation. With that, I'll turn the call over to Glenn to provide additional detail on our financial results. Glenn? Thanks, Doug, and good morning.

I'd like

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: to highlight key results for the third quarter and then finish my remarks with our expectations and outlook for the fourth quarter and full year. The third quarter produced strong financial results for the company. We delivered twelve seventeen homes, exceeding the high end of our guidance. Wholesale revenue was $817,000,000 for the quarter with an average sales price of 672,000 Gross margin, adjusted to exclude an $8,000,000 impairment charge, was 21.6 percent for the quarter. SG and A expense as a percentage of home sales revenue was 12.9%, which was at the lower end of our guidance, benefiting from savings in G and A and better top line revenue leverage as a result of exceeding our delivery guidance.

Finally, net income for the year was $62,000,000 or $0.71 per diluted share, also adjusted for the same inventory related charge. Sending home orders in the third quarter were $9.95 with an absorption pace of 2.2 homes per community per month. Regionally, our absorption pace in the West was 2.3, with the Southern California markets outperforming and the Bay Area experiencing softer market conditions. The Central Region averaged 1.8 absorption pace for the quarter, with increased supply of both new and resale homes in Austin, Dallas, Denver and Denver impacted pace during the quarter, while Houston continued to outperform in the region. In the East, absorption pace was 2.8, led by strong results in our DC Metro and Raleigh divisions, while Charlotte was consistent with the company average.

We invested approximately $260,000,000 in land and land development during the quarter and ended with over 32,000 total lots, 51% of which are controlled via auction. Looking at the balance sheet, we ended the quarter with $1,600,000,000 in liquidity consisting of $792,000,000 of cash and $791,000,000 available under our unsecured revolving credit facility. As of the end of the quarter, our homebuilding debt to capital ratio was 25.1%, and our homebuilding net debt to net capital ratio was 8.7%. As Doug mentioned, we increased our term loan by $200,000,000 to a total outstanding amount of $450,000,000 and added extension rights that, if exercised, could extend the due date to 2029. The term loan is an effective source of additional liquidity to help fuel our future community count growth and other capital needs.

Now I'd like to summarize our outlook for the fourth quarter and full year of 2025. For the fourth quarter, we expect to deliver between twelve hundred and fourteen hundred homes at an average sales price of between $690,000 and 700,000 We anticipate homebuilding gross margin percentage to be in the range of 19.5% to 20.5%. We expect our SG and A expense ratio to be in the range of 10.5% to 11.5%, and we estimate our effective tax rate for the fourth quarter to be approximately 27%. For the full year, we expect to deliver big deliveries between 4,805 homes with an average sales price of approximately $680,000 We anticipate our full year homebuilding gross margin to be approximately 21.8%, which excludes the inventory related charges recorded year to date. Finally, we anticipate our SG and A expense ratio to be approximately 12.5%, and we estimate our effective tax rate for the full year to be approximately 27%.

With that, I will now turn the call back over to Doug for closing remarks.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Thanks, Glenn. In closing, I want to thank our team members, customers, trade partners, and shareholders for their ongoing trust and support. We're proud to have been recognized once again as one of the Fortune 100 Best Companies to Work For in 2025, a reflection of the culture and values that drive our performance. While the near term environment remains uncertain, our long term outlook is very positive, and we are confident that our strategy, our people and our financial and operating discipline position TRI Pointe Homes to deliver sustainable growth and long term shareholder value. With that, I'll turn the call over to the operator for any questions.

Thank

Conference Operator: A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. In the interest of time, we ask the participants limit themselves to one question and one follow-up. One moment please while we poll for questions.

Our first question is from Paul Przybylski with Wolfe Research.

Paul Przybylski, Analyst, Wolfe Research: I guess, first off, could you provide some color on the monthly cadence of your orders and incentives through the quarter?

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Sure, Paul. Hey, this is Glenn. The monthly cadence was pretty consistent actually through the quarter. If you look at absorption, it was roughly the same each month with, you know, September being a little bit better than than August. And then on incentives, incentives were also consistent throughout the quarter.

Incentives on deliveries were 8.2% for the quarter.

Paul Przybylski, Analyst, Wolfe Research: Okay. Thank you very much. And then I guess, you know, your your absorptions are are getting down close to the two level. Is there, you know, an absolute floor that you wanna maintain on your sales pace, I e, increase incentives to to keep a level?

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Hey, Paul. It's Doug. You know, it's it's a good question. I mean, the industry's kinda working through a a a big it's like trudging through mud right now. And so, you know, somewhere between two and two and a half is kinda where, you know, everybody seems to be landing.

And, you know, if if you're looking at we're looking at very strong community count growth in '26. So as we look forward to that and even under similar market conditions, we've got some pretty pretty nice growth in orders going forward.

Paul Przybylski, Analyst, Wolfe Research: Thank you. Appreciate it.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Thanks, Paul.

Conference Operator: Our next question is from Stephen Kim with Evercore ISI.

Stephen Kim, Analyst, Evercore ISI: Hey, thanks guys. I appreciate the color so far. If I could just follow-up on Paul's question here on the incentives. Said 8.2%, I think, of revenues or home sales. Were how much of those were financial incentives if you sort of include closing costs and rate buy downs for purchase commitments and that sort of thing?

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Hey, Steven, it's Glenn. You're correct. It was 8.2% of revenue in the quarter and about a third of those were financing related including closing costs.

Stephen Kim, Analyst, Evercore ISI: Okay. And what do you how about forward purchase commitment specifically? Do you use them very much?

Linda Vemay, Executive Vice President and Chief Marketing Officer, TRI Pointe Homes: Stephen, this is Linda. Yes, we do. We primarily use forward commitment for advertising purposes, and they do have good value in driving additional interest and traffic. But ultimately, as Glenn said, most of our customers really don't need to have a significantly lower interest rate to qualify for the home. So they prefer to use more of their incentive dollars in design studio personalization.

Stephen Kim, Analyst, Evercore ISI: Yeah. So like if you think of the third, let's say the 35% or whatever that are financial incentives, how much of that third would you say is forward purchase commitments?

Linda Vemay, Executive Vice President and Chief Marketing Officer, TRI Pointe Homes: Oh, it's very small, under 1%.

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Yeah, very small number.

Stephen Kim, Analyst, Evercore ISI: Okay, awesome. Yeah, that's great. And then your average order ASP, not your closings ASP, but your order ASP, come down to, call it, what, is it six fifty four, I think, this quarter. Last quarter, was like about six sixty five. So is it reasonable to think that, you know, eventually your closings ASP is gonna be at roughly that kind of level, you know, $6.50, $6.60?

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Yeah. It it is, Steven. I mean, it's it it the mix within the quarter does play a part. But when you look at, you know, our growth next year of a lot of Central and east regions, and those do carry a little bit lower of an ASP versus the West. And so just it's really just mix for us more than anything else.

Stephen Kim, Analyst, Evercore ISI: Gotcha. Okay. Well, appreciate the color, guys. Thanks.

Conference Operator: Our next question is from Jay McCanless with Wedbush Securities.

Jay McCanless, Analyst, Wedbush Securities: Hey, thanks for taking my questions. First one, the SG and A guide for the fourth quarter, it looks like you guys are getting much better leverage than what the top line would suggest. Are there some one times in there? Can you talk about how you're able to potentially get this very good SG and A to to sales number?

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: No. We're all specific one time there, Jay. It's it is just a little bit more, you know, more revenue in the quarter with a higher delivery number, and that's what's really driving it.

Jay McCanless, Analyst, Wedbush Securities: Okay. And then kind of that that was actually gonna be my next question. The, you know, the gross margin guide is better than we were expecting. Is there some mix in there, more move up? Any anything you can give us on that?

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: A little bit of mix. I think some of the divisions that continue to outperform are, you know, strong margin divisions, like, when you look at, like, a Houston, Inland Empire in Southern California, you know, things like that have, have driven the mix of margin, you know, to our benefit. So that that plays a little part into it, Jay.

Jay McCanless, Analyst, Wedbush Securities: Okay. And then one one more if I could. Just kinda thinking about the newer markets y'all discussed and just wondering what what you all think ASP might look like this next year, just given some of the the smaller medium price markets that you're going to be expanding into.

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: We'll we'll give that guidance next time, Jay, as we kinda roll up the plan and see what that looks like. But I I don't think you're gonna be too different than where we're at this year.

Tom Mitchell, President and Chief Operating Officer, TRI Pointe Homes: No. We're not getting significant contributions out of our new expansion divisions yet next year. So this should have a minimal impact.

Jay McCanless, Analyst, Wedbush Securities: Okay. Great. Appreciate it.

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Thanks.

Conference Operator: Our next question is from Alan Ratner with Zelman and Associates.

Stephen Kim, Analyst, Evercore ISI: Hey guys, good morning. Thanks for

Alan Ratner, Analyst, Zelman and Associates: all the details so far. Can you just update us on your spec position and strategy and how you're thinking about spec just in terms of the contribution to the business? And I guess just thinking forward to '26, you're going to enter the year with a backlog that's down quite a bit. So are you going to lean heavily on spec next year to kind of bridge that gap? Or is that kind of a TBD based on what happens in the spring?

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: It is. It's, Alan. We've got about three quarters of our orders are running as specs as we go into the end of the year. All the builders have a little bit more inventory than what they anticipated. So we'll burn through that inventory going into the first quarter or so of next year and then get to a more balanced approach.

Again, demand is is very inelastic, and and we're gonna continue to focus on price over pace as we go into the new year. We're we're just assuming similar market conditions. What we're really focused on is that strong community count growth. Even at similar market conditions, as I mentioned earlier, we'll have a really good order growth going into '26 and then '27. So we're really looking to the future while we've been dealing with some of the, obviously, challenges the market has posed to the entire industry.

So that's kind of how we're looking at our approach.

Linda Vemay, Executive Vice President and Chief Marketing Officer, TRI Pointe Homes: And just to add to that, Alan, we did reduce our total spec inventory by 17% quarter over quarter.

Alan Ratner, Analyst, Zelman and Associates: Got it. Linda, is that total specs under construction or completed homes specifically?

Linda Vemay, Executive Vice President and Chief Marketing Officer, TRI Pointe Homes: Both together, 17%.

Alan Ratner, Analyst, Zelman and Associates: Got it. That's the total number. Perfect. Doug, you mentioned community count growth next year several times. I'm just curious when you think about the pricing strategy there, obviously, you guys have been very steadfast in your approach.

When you open up communities, how do you think about pricing on those? Is the intention to kind of maybe come out of the gate with more attractive pricing and build up a backlog as you and then raise prices through the life cycle of the project? Or are you kind of maintaining a similar strategy to your active communities? Like you have an idea of what the value is and you're going to come to market with that price and whatever the absorption is, that's what it's going to be for the time being.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Yeah. No. TRI Pointe, as you know, Alan, is is more of a premium brand proposition. So we look at our value proposition as it as it enters the market. Sure.

You love to start with some momentum, but there's not any any sort of material pricing thought process there because we're we're building, you know, along main and main, the great locations, close to employment, and great amenities. So the value proposition is what we're looking at. And frankly, you said, I'm I'm I'm really my lens is to the future. I I hope we've been dealing with choppy market conditions in my mind for about eighteen months. So if it's more the same next year, so be it.

But we're going to have a strong community count, and we'll price the product appropriately to the marketplace to have the right value proposition that we propose.

Alan Ratner, Analyst, Zelman and Associates: Understood. Appreciate it. Thanks a lot.

Conference Operator: Our next question is from Mike Dahl with RBC Capital Markets.

David Lee, General Counsel, TRI Pointe Homes0: This is Chris on for Mike. Can you just talk through your initial thoughts around the administration's affordable housing push? What conversations have you had to date? And how are you thinking about the opportunities and risks to your operating and capital allocation strategy?

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Yes. No, obviously, several builders have already made comments on that. And we're kind of the tail wagging the dog here, so speak. But we share the administration's goal of providing more housing in The US. As duly noted, I mean, that industry has been under built and been doing this for thirty five years.

It kind of started after the great financial crisis, so it makes me very old. But we welcome working with the relevant stakeholders at the federal, state, and local levels. It's a very complicated, interrelated discussion. Most of it happens at the local and state level, but we look forward to working with the administration. Wherever TRI Pointe can help, we will build I mean, we've got 32,000 lots that we own and control.

We're opening very strong community count growth of up to 15% next year. So we'll be doing our share of bringing in more communities that will be attainable for our buyer profile.

David Lee, General Counsel, TRI Pointe Homes0: Makes sense. Yeah. And the community count, that was definitely encouraging. And then just shifting to the 4Q gross margin guide, could you just help bracket some of the big moving pieces around the sequential step down in gross margin? How much of that is incremental incentives, mix, sticking break?

Just help frame that for us. Thank you.

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Yeah. This is Glenn. Good question. And it not really sticking bricks or anything like that. I think it's a little bit of mix, but also just, you know, we've increased incentives as we've gotten through the year.

We have spec homes to sell and close within the quarter and those generally carry a little bit higher of incentives. So all that kind of goes into that margin guide.

David Lee, General Counsel, TRI Pointe Homes0: Got it. I appreciate the color. Thanks.

Conference Operator: Our next question is from Ken Zaneer with Seaport Research Partners.

David Lee, General Counsel, TRI Pointe Homes1: Good morning, everybody.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Good morning.

David Lee, General Counsel, TRI Pointe Homes1: I am hoping you can walk us through kind of the logic, not giving guidance or anything, but just kind of understand the cadence. So looking at starts and orders, it looks like you guys did about 500 starts this quarter in the third quarter versus orders that were higher than that. So as we exit the year, how are you thinking about starts versus orders? Because your inventory is down units are down about 30% year over year. So I'm just trying to understand since you're talking about opening communities.

And Doug, I think you just set up words of 15%. Or is that what you had said as well? Community growth next year?

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: That.

David Lee, General Counsel, TRI Pointe Homes1: Potentially.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: We indicated that community count growth will be 10 to 15%.

David Lee, General Counsel, TRI Pointe Homes1: So I'm just trying to see how we actually get these, right, the units in the ground, which could portend future closings. So that's why I'm focusing on the starts versus the order and how you're thinking about that. Thank you.

Tom Mitchell, President and Chief Operating Officer, TRI Pointe Homes: Yeah, Ken. This is Tom. It's a it's a great place to focus on as we've been focused on it as well. As Doug mentioned earlier in the q and a, you know, we're focused on getting our business back to a more balanced approach of spec to to be built. And you're right on with our starts for q three was about 577, and that's down significantly from where we were in q one and q two.

But, again, it's relative to that balanced approach. I think you'll see q four starts more comparable with what q three was just because of the amount of in process under construction homes that we have available, and that's our number one goal, to move through that inventory. And then after that, we'll move to a more normalized strategy, which takes into account absorption on a community by community basis.

Conference Operator: Appreciate it, Tom. I guess

David Lee, General Counsel, TRI Pointe Homes1: when I heard you say 4Q starts is going to be similar to 3Q.

Stephen Kim, Analyst, Evercore ISI: Is that right? I mean,

David Lee, General Counsel, TRI Pointe Homes1: that means you're ending inventory. I'm just trying to imagine the growth you're having community count with the actual contraction in your inventory units.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: I guess I'm trying to is that to get

David Lee, General Counsel, TRI Pointe Homes1: there some greater inflection that I don't understand.

Tom Mitchell, President and Chief Operating Officer, TRI Pointe Homes: No. I don't I don't think you're missing anything there. I mean, as you look at it on a community by community basis, obviously, when we're moving into new communities, we're making the necessary starts relative to our anticipated demand.

David Lee, General Counsel, TRI Pointe Homes1: Right.

Tom Mitchell, President and Chief Operating Officer, TRI Pointe Homes: But where we have where we have existing communities, obviously, we have excess inventory that we're gonna be working through before we move to a more normalized balance start strategy.

David Lee, General Counsel, TRI Pointe Homes1: Appreciate it. And then on the community count growth, is most of that G and A, the fixed G and A already kind of loaded in there. Is there

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: any big lift we should expect there? Thank you.

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Not not too much of a lift on the g and a side. Maybe some incremental. That's more field and sales that

David Lee, General Counsel, TRI Pointe Homes: will Excellent.

Glenn Keeler, Chief Financial Officer, TRI Pointe Homes: Needed to open those communities. But yeah.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Thank you, guys. Bye bye.

Conference Operator: Thank you. There are no further questions at this time. I'd like to turn the floor back over to Doug Bauer for closing remarks.

Doug Bauer, Chief Executive Officer, TRI Pointe Homes: Well, thank you everybody for joining us today. We're looking forward to sharing our growth plan and strategy for 2026 and beyond with you at our next quarter's call. And as we go into 2026, we're very excited and bullish about the future for housing. So thank you and talk to you next quarter.

Conference Operator: Thank you. This concludes today's conference. You may disconnect your lines at this

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