LGI Homes, Inc.

Welcome to the LGI Homes third quarter 2025 conference call. Today's call is being recorded and a replay will be available on the company's website at www.lgihomes.com. After management's prepared comments, there will be an opportunity to ask questions. At this time, I'll turn the call over to Joshua Fatter, Executive Vice President of Investor Relations and Capital Markets.

Thanks and good afternoon. I'll remind listeners that this call contains forward-looking statements, including management's views on the company's business strategy, outlooks, plans, objectives, and guidance for future periods. Such statements reflect management's current expectations and involve assumptions and estimates that are subject to risks and uncertainties that could cause those expectations to be incorrect. You should review our filings with the SEC for a discussion of the risks, uncertainties, and other factors that could cause actual results to differ from those presented today. All forward-looking statements must be considered in light of those related risks, and you shouldn't place undue reliance on such statements, which reflect management's current viewpoints and are not guarantees of future performance. On this call, we'll discuss non-GAAP financial measures that are not intended to be considered in isolation or as substitutes for financial information presented in accordance with GAAP. Reconciliations of non-GAAP financial measures to the most comparable measures prepared in accordance with GAAP will be found in the press release we issued this morning and in our quarterly report on Form 10-Q for the quarter ended September 30th, 2025 that we expect to file with the SEC later today. This filing will be accessible on the SEC's website and on the investor relations section of our website. I'm joined today by Eric Weaver, LGI Homes Chief Executive Officer and Chairman of the Board, and Charles Merdien, Chief Financial Officer and Treasurer. I'll now turn the call over to Eric.

Thanks, Josh. Good afternoon and welcome to our earnings call. During the quarter, our teams remained focused, driving leads, managing inventory, and supporting our customers by delivering exceptional customer service and providing a seamless road to homeownership. Thanks to our outstanding efforts, we delivered positive third quarter results that were in line with the guidance provided on our last call. During the quarter, we closed 1,000 107 homes. Of this total, 1,065 homes contributed directly to our reported revenue of $397 million. The remaining 42 were currently or previously leased homes, the profits of which reflected in other income. Gross margin came in at 21.5%, and adjusted gross margin was 24.5%, both in line with the guidance range we provided. We've been successful in maintaining the overall strength of our margins, even while operating in the most challenging segment of the market. That's on purpose, and it's worth spending a few moments discussing why. First, we take a thoughtful approach to financing incentives. With higher mortgage rates driving affordability challenges, buy downs and other financing tools are among the most effective ways to help buyers reach the closing table, and we continue to lean in to offering the most competitive buy downs possible. However, going to extremes on buy-downs just to move a few incremental homes is something we're working hard to avoid. Second, we continue to price all of our homes competitively and we use price adjustments selectively, focusing on aging inventory while maintaining or raising prices in high-performing communities. Third, we prefer not to sacrifice margins to institutional land bankers. As a result, we don't have a pipeline of lot takedowns pressuring us to start homes prematurely, heavily discounting them to keep the system moving, or to renegotiate takedown schedules, which leads to higher future lot costs. Avoiding these situations gives us the freedom to be patient and make smart, long-term decisions that will benefit our shareholders. Our best land banking partner has been and will continue to be the seller. Finally, because we primarily self-develop our lots, our margins include the profit a developer would have earned. This adds several hundred basis points to our margins and sets our performance apart from other builders who rely on purchasing finished lots. It's also a key reason we have never taken an inventory impairment. In short, our margins reflect disciplined execution, not elevated pricing. We do everything possible to manage costs and deliver a high-quality, beautiful home at a price that enables as many first-time buyers as possible to achieve the dream of homeownership. During the third quarter, our top markets on a closing community basis were Charlotte with 5.7, Las Vegas with 4.7, Raleigh with 4.2, Greenville with 3.7, and Denver with 3.5 closings per community per month. Congratulations to the teams in these markets on their performance last quarter. Another highlight of our results was the significant increase in net orders and backlog. As we noted on our last call, sales trends improved in the back half of June, continuing into July, as mortgage rates declined from their mid-year highs. These trends continued into August and September, driven by continued relief in rates and sales initiatives connected to our year-end Make Your Move national sales event. Because mortgage rates remain the key pressure point for entry-level buyers, we introduced exceptional financing options, including a forward rate buy-down commitment, which has a meaningful impact on improving affordability for many buyers. Additionally, we're offering price discounts of up to $50,000 on select older inventories. Together, these initiatives jump-started sales activity demonstrated by an 8% increase in net orders compared to the same period last year and a 44% increase compared to the second quarter. As a result, our backlog at quarter end was up 20% year-over-year and 62% sequentially. We're encouraged by the momentum these initiatives have generated and view them as a positive step forward as we head into the fourth quarter. Before I hand the call over to Charles, I'll note that our long-term view of the housing market remains solidly optimistic. The underlying demographic trends continue to support our strategy, while the widening supply gap makes the attainable housing options LGI provides more valuable than ever. With that, I'll invite Charles to provide additional details on our financial results.