“Based on the strong pricing and margin embedded in our backlog and with approximately half of our backlog scheduled for delivery in fiscal year 2023, we expect our fiscal year 2023 adjusted gross margin to be better than fiscal year 2022’s.”

In context

“arter at an average price of approximately $908,000, resulting in record home sales revenue of $2.2 billion. This was an increase of 19% compared to last year’s second quarter revenue. Our teams did a great job delivering homes in what continues to be a very challenging production environment. Adjusted gross margin of 26.1% in the quarter improved 170 basis points compared to last year’s second quarter and was 60 basis points better than guidance. SG&A expense, at 11.1% of homebuilding revenues, was 80 basis points better than both last year’s second quarter and our guidance. Driven by significant revenue growth and expanding margins, we generated earnings per share of $1.85, up 83% compared to last year. At second quarter end, our backlog stood at a record $11.7 billion and 11,768 homes. Based on the strong pricing and margin embedded in our backlog and with approximately half of our backlog scheduled for delivery in fiscal year 2023, we expect our fiscal year 2023 adjusted gross margin to be better than fiscal year 2022’s. Sales in our second quarter were our highest quarter ever as demand remains strong across all of our buyer segments and geographies. We signed 2,874 net contracts for $3.1 billion, up 1.2% in dollars over 2021’s extremely strong second quarter, when orders were up 97% in dollars compared to Q2 of 2020. Our quarterly sales pace was consistent with the 8.8 contracts per community that we projected for Q2 on our earnings call back in February. While demand is still solid, over the past month, it has moderated from the unprecedented pace of the past 2 years as buyers adapt to higher mortgage rates and other macroeconomic conditions. The substantial rise in home prices, the steep increase in mortgage rates since January, inflation concerns and stock market volatility are all having an impact o”