LGIH · 10-Q · 2026Q1 · Full report

Wholesale Channel Decline

LGI Homes, Inc. · 2026-04-28 · Importance 72 · Surprise 74

Wholesale revenues declined to $29.8 million from $54.5 million year-over-year for the three months ended March 31, 2026 and 2025, respectively, reflecting a drop from 179 wholesale closings to 111 closings. Wholesale closings represented 12.6% of total homes closed in Q1 2026 versus 18.0% in Q1 2025, and management attributes the decline to lower institutional demand. The overall decrease in home sales and closings (home sales revenue down $31.7 million and homes closed down 11.5%) was driven in part by fewer wholesale closings and lower absorption rates. Reduced institutional activity is cited as a material channel shift that impacted Q1 results and gross margin composition.

Key facts

• Included within home sales revenues for the three months ended March 31, 2026 was $29.8 million in wholesale revenues resulting from 111 home closings, representing 12.6% of the 881 total homes closed during the period.
• Included within home sales revenues for the three months ended March 31, 2025 was $54.5 million in wholesale revenues resulting from 179 home closings, representing 18.0% of the 996 total homes closed during that period.
• As of March 31, 2025, the company had 253 units related to bulk sales agreements associated with its wholesale business.
• As of March 31, 2026, the company had 442 units related to bulk sales agreements associated with its wholesale business.
• The decrease in wholesale closings during the three months ended March 31, 2026 was primarily related to lower institutional demand compared to the three months ended March 31, 2025.