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Description of Kb Home's Business Segments
KB Home is a leading homebuilder that operates primarily in the United States, with a growing international presence. The companys operations are segmented into two primary financial reporting segments: construction and mortgage banking. Heres a detailed description of these segments, the products and services offered, and insights into their international operations.
1. Construction Segment
The construction segment is the backbone of KB Homes overall business and encompasses both domestic and international homebuilding operations:
A. Domestic Homebuilding
- Acquisition and Development of Land: KB Home is engaged in acquiring land that is strategically located and suitable for residential development. The company focuses on obtaining land in desirable communities that are attractive to potential homebuyers.
- Home Types and Offerings: KB Home develops a diverse range of residential properties tailored to meet the needs of different demographics. This includes:
- First-Time Homebuyers: The company produces a variety of starter homes that are affordable and designed to attract young families or individuals entering the housing market for the first time.
- Move-Up Buyers: KB Home offers larger homes with more amenities for buyers looking to upgrade from their first homes. These properties often feature more square footage and advanced finishes.
- Active Adult Communities: Recognizing the needs of older adults, KB Home also develops single-story, low-maintenance homes in age-restricted communities, catering to active adult buyers seeking to downsize while still enjoying the amenities and luxury.
- Customization Options: KB Home is known for its Built to Orderapproach, allowing buyers to customize their homes according to personal preferences. This includes choices related to floor plans, interior finishes, and the overall design of the home.
- Sustainability: The company is committed to incorporating sustainable building practices and energy-efficient materials in their homes, thereby appealing to environmentally conscious buyers and promoting long-term energy cost savings.
B. International Homebuilding
KB Home has expanded its operations beyond U.S. borders, engaging in international homebuilding projects. The international segment includes:
- Regional Presence: While the company primarily operates in the U.S. KB Homes international ventures have included activities in Mexico and other select markets. These operations allow them to tap into the growing demand for residential housing in these areas.
- Adapting to Local Markets: Each international market presents its unique challenges and opportunities. KB Home modifies its offerings based on local consumer preferences, local customs, and regulatory environments, allowing for greater market penetration and customer satisfaction.
Mortgage Banking Segment
The mortgage banking segment of KB Home is designed to support their homebuyers in securing financing for their new homes:
- Mortgage Loan Origination: KB Home offers a range of mortgage products through its subsidiary, KB Home Mortgage. This includes fixed-rate mortgages, adjustable-rate mortgages, as well as specialized products tailored to first-time homebuyers or those looking to utilize government-backed loans.
- Financing Solutions: In addition to traditional mortgage options, KB Home provides a variety of financing solutions and assistance programs. These may include down payment assistance, incentives for military personnel, and products designed for buyers with varying financial backgrounds.
- Streamlined Process: Leveraging its construction segment, KB Home works to provide an integrated home-buying process where potential homebuyers can coordinate seamlessly between selecting a home and securing financing.
International Operations
As of the latest updates:
- International Strategy: While the primary focus remains on the U.S. market, KB Home has recognized the potential of international markets, particularly in regions that are experiencing growth in housing demand. The companys strategy includes targeting countries with burgeoning middle-class populations and increasing urbanization trends.
- Community Engagement: In international markets, KB Home emphasizes building relationships with local communities and leveraging local partnerships to enhance its brand presence.
- Regulatory Compliance: Navigating international operations necessitates compliance with various local regulations and standards. KB Home is dedicated to understanding and adhering to these requirements to ensure successful market entry and sustainability.
- Continued Expansion: The company is actively evaluating new markets for potential expansion. This includes analyzing economic indicators, demographic trends, and housing market dynamics to identify opportunities where they can successfully replicate their U.S. business model.
In conclusion, KB Home offers a comprehensive range of products and services within its construction and mortgage banking segments, focusing on meeting the diverse needs of homebuyers. The company continues its commitment to growth, innovation, and adaptation within both domestic and international markets, ensuring it remains a competitive player in the ever-evolving housing industry.
Composition of Kb Home Revenues by
Segments |
| |
| Homebuilding |
|
 99.68 % |
of total Revenue |
| Homebuilding West Coast |
|
43.16 % |
of total Revenue |
| Homebuilding Southwest |
|
20.54 % |
of total Revenue |
| Homebuilding Central |
|
18.5 % |
of total Revenue |
| Homebuilding Southeast |
|
17.49 % |
of total Revenue |
Q2 three months ended (May 31 2025)
|
| Revenues by Business Segments |
Revenues
(in millions $) |
%
(of total Revenues) |
| Homebuilding |
1,524.72 |
99.68 % |
| Homebuilding West Coast |
660.19 |
43.16 % |
| Homebuilding Southwest |
314.10 |
20.54 % |
| Homebuilding Central |
282.97 |
18.5 % |
| Homebuilding Southeast |
267.46 |
17.49 % |
| Total |
1,529.59 |
100 % |
Q2 three months ended (May 31 2025)
|
| Revenue Growth rates by Segment |
Y/Y Revenue
% |
Q/Q Revenue
% |
| Homebuilding |
-10.39 % |
9.93 % |
| Homebuilding West Coast |
-5.47 % |
9.73 % |
| Homebuilding Southwest |
-1.43 % |
0.39 % |
| Homebuilding Central |
-24.7 % |
2.67 % |
| Homebuilding Southeast |
-13.34 % |
35.83 % |
| Total |
-10.54 % |
9.9 % |
Q2 three months ended (May 31 2025)
|
| Income by Business Segments |
Income
(in millions $) |
%
(Profit Margin) |
| Total |
107.88 |
7.05 % |
Q2 three months ended (May 31 2025)
|
| Income Growth rates by Segment |
Y/Y Income
% |
Q/Q Income
% |
| Total |
- |
-1.53 % |
Annual Report on Kb Home Divisions, Sales by Country |
| |
| Homebuilding |
|
99.6 % |
of total Revenue |
| Homebuilding West Coast |
|
42.31 % |
of total Revenue |
| Homebuilding Southwest |
|
18.9 % |
of total Revenue |
| Homebuilding Central |
|
20.96 % |
of total Revenue |
| Homebuilding Southeast |
|
17.42 % |
of total Revenue |
Twelve months ended 2024
|
| KBH s Annual Revenue by Geography and Business Segments |
Sales
(in millions $) |
%
(of total Sales) |
| Homebuilding |
6,902.24 |
99.6 % |
| Homebuilding West Coast |
2,932.06 |
42.31 % |
| Homebuilding Southwest |
1,309.95 |
18.9 % |
| Homebuilding Central |
1,452.79 |
20.96 % |
| Homebuilding Southeast |
1,207.44 |
17.42 % |
| Total |
6,930.09 |
100 % |
Twelve months ended 2024
|
| KBH s Annual Income by Country and Business Segments |
Income
(in millions $) |
%
(Profit Margin) |
| Total |
655.02 |
9.45 % |
Twelve months ended 2024
|
| Annual Revenue and Income Growth by Country and Business Segments |
% Y/Y Sales Growth |
% Y/Y Income Growth |
| Homebuilding |
8.17 % |
- |
| Homebuilding West Coast |
26.32 % |
- |
| Homebuilding Southwest |
11.97 % |
- |
| Homebuilding Central |
-20.7 % |
- |
| Homebuilding Southeast |
14.11 % |
- |
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