D
.R. Horton, the largest US homebuilder by revenue, exceeded analysts' expectations for its first-quarter results, driven by incentives and strong housing demand. The company's shares initially rose over 5% but later declined about 1%. To mitigate customer concerns about high interest rates, D.R. Horton has been offering mortgage rate buydowns, permanent or temporary interest-rate reductions on home loans, as well as smaller homes.

    Despite ongoing affordability challenges and competitive market conditions, these incentives have helped address affordability issues and boost demand, according to Executive Chairman David Auld. However, the company expects incentive costs to increase for homes closed in the next few months, leading to a lower gross margin in the second quarter compared to the previous period.

    D.R. Horton reported a 22.7% gross margin for the first quarter ended December 31, down from 22.9% a year ago. The company closed sales on 19,059 homes during the quarter, a 1% decrease from the same period last year. First-quarter revenue reached $7.61 billion, surpassing analysts' average estimate of $7.08 billion, while earnings per share were $2.61, above the estimated $2.36.

    The company's Chief Operating Officer, Michael Murray, expressed hope that future policies could help drive affordability, specifically mentioning potential impacts from tariff and immigration policy under the previous administration.