Toll Brothers Inc. (TOL) reported mixed fourth-quarter results Monday evening, delivering a revenue beat but falling short on earnings as the luxury homebuilder navigates what CEO Douglas Yearley Jr. described as "soft demand across many markets."

The Numbers Tell a Mixed Story

Revenue came in at $3.42 billion for the fourth quarter of fiscal 2025, topping the consensus estimate of $3.30 billion. But earnings of $4.58 per share missed analyst expectations of $4.89 per share, sending shares down over 4% in after-hours trading to $130.55.

Home sales revenue climbed roughly 5% year-over-year as Toll Brothers delivered 3,443 homes in the quarter, up slightly from 3,431 a year earlier. The company's net signed contract value hit $2.53 billion at quarter's end, but backlog value dropped to $5.5 billion from $6.5 billion year-over-year—a notable decline that suggests softer demand ahead.

The company bought back approximately 1.8 million shares during the quarter and closed the period with $1.26 billion in cash and cash equivalents.

Management's Response to Market Conditions

"Given soft demand across many markets, we remain focused on running our business in a disciplined manner and consistent with our long-term strategic objective of maximizing returns for stockholders," Yearley said in the earnings release.

He added that the company is "actively managing our spec starts and inventory on a community-by-community basis to best match local demand conditions" while balancing price and pace.

Looking Ahead

For the first quarter, Toll Brothers expects to deliver 1,800 to 1,900 homes at an average price between $985,000 and $995,000. The company anticipates an adjusted home sales gross margin of 26.25%, up from 25.5% in the fourth quarter.

For the full fiscal 2026, management projects deliveries of 10,300 to 10,700 homes at average prices ranging from $970,000 to $990,000.

Company executives will discuss the results in more detail during an earnings call Tuesday at 8:30 a.m. ET.