D.R. Horton, Inc. stock research
FY2026 Q1
D.R. Horton (DHI) Gross Margin — Quarter Ended Dec 31, 2025
Revenue and gross profit both declined relative to the prior quarter and the same quarter last year. Gross margin improved from the prior quarter but weakened compared to the year-ago period, as the cost of revenue changed at different rates relative to revenue.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2026 Q1
Revenue and gross profit both declined relative to the prior quarter and the same quarter last year. Gross margin improved from the prior quarter but weakened compared to the year-ago period, as the cost of revenue changed at different rates relative to revenue.
- The strongest observable margin driver is the relationship between cost of revenue and revenue. Sequentially, cost of revenue fell more sharply than revenue, lifting the margin; year-over-year, cost of revenue declined less than revenue, compressing the margin.
- Compared to the immediately preceding quarter, gross margin was higher. Compared to the same quarter one year earlier, gross margin was lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
23.2%
Gross profit
$1.6B
Revenue
$6.9B
Cost of revenue
$5.3B
Quarter-over-quarter change
+1.5 pts
Year-over-year change
-1.9 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2025 | $7.7B | $1.9B | $5.8B | 24.6% |
| Jun 30, 2025 | $9.2B | $2.2B | $7.0B | 23.9% |
| Sep 30, 2025 | $9.7B | $2.1B | $7.6B | 21.7% |
| Dec 31, 2025 | $6.9B | $1.6B | $5.3B | 23.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
+1.5 pts
Year-over-year change
Dec 31, 2024
-1.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the relationship between cost of revenue and revenue. Sequentially, cost of revenue fell more sharply than revenue, lifting the margin; year-over-year, cost of revenue declined less than revenue, compressing the margin.
Compared to the immediately preceding quarter, gross margin was higher. Compared to the same quarter one year earlier, gross margin was lower.
Monitor the trend in cost of revenue relative to revenue, especially given the filing’s mention of risks from interest rate changes and mortgage financing availability.