UNITED STATES SECURITIES AND EXCHANGE COMMISSION

(215) 938-8000

Certain information included in this report or in other materials we have filed or will file with the Securities and Exchange Commission (“SEC”) (as well as information included in oral statements or other written statements made or to be made by us) contains or may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). One can identify these statements by the fact that they do not relate to matters of a strictly historical or factual nature and generally discuss or relate to future events. These statements contain words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “may,” “can,” “could,” “might,” “should,” “likely”, “will” and other words or phrases of similar meaning. Such statements may include, but are not limited to, information related to: market conditions; mortgage rates; inflation rates; demand for our homes; our built-to-order and statements regarding: expectations regarding interest ratesquick move-in home strategy; sales paces and inflation; the markets in which we operate or may operate;prices; effects of home buyer cancellations; our strategic objectivespriorities; growth and priorities;expansion; our land acquisition, land development and capital allocation plans and priorities; housing market conditions; demand for our homes; anticipated operating results and guidance;results; home deliveries; financial resources and condition; changes in revenues,revenues; changes in profitability andprofitability; changes in margins; changes in accounting treatment; cost of revenues, including expected labor and material costs; availability of labor and materials; selling, general and administrative expenses; interest expense; inventory write-downs; home warranty and construction defect claims; unrecognized tax benefits; anticipated tax refunds; sales paces and prices; effects of home buyer cancellations; growth and expansion; joint ventures in which we are involved; anticipated results from our investments in unconsolidated entities; our ability to acquire or dispose of land and pursue real estate opportunities; our ability to gain approvals to develop land,and open new communities and deliver homes;communities; our ability to market, construct and sell homes and properties; the rate at which weour ability to deliver homes from backlog; our ability to secure materials and subcontractors; our ability to produce the liquidity and capital necessary to conduct normal business operations or to expand and take advantage of opportunities; and the outcome of legal proceedings, investigations, and claims.claims; and the impact of public health or other emergencies.

From time to time, forward-looking statements also are included in other reports on Forms 10-K, 10-Q, and 8-K; in press releases; in presentations; on our website; and in other materials released to the public. These statements may include guidance regarding our future performance, such as our anticipated annual revenue, home deliveries, and margins, that represents management’s estimates as of the date of publication. Guidance is based upon a number of assumptions and estimates that, while presented with numerical specificity, are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and are based upon specific assumptions with respect to future business decisions, some of which will change.

Any or all of the forward-looking statements included in this report and in any other reports or public statements made by us are not guarantees of future performance and may turn out to be inaccurate. Consequently, actual results may differ materially from those that might be anticipated from our forward-looking statements. This can occur as a result of incorrect assumptions or as a consequence of known or unknown risks and uncertainties. Therefore, we caution you not to place undue reliance on our forward-looking statements. The major risks and uncertainties – and assumptions that are made – that affect our business and may cause actual results to differ from these forward-looking statements include, but are not limited to:

Many of the factors mentioned above, elsewhere in this report or in other reports or public statements made by us will be important in determining our future performance. Consequently, actual results may differ materially from those that might be anticipated from our forward-lookingForward-looking statements.

For a further discussion of factors that we believe could cause our actual results to differ materially from expected and historical results, see “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our most recent Annual Report on Form 10-K filed with the SEC and in this report.

When this report uses the words “we,” “us,” “our,” and the “Company,” they refer to Toll Brothers, Inc. and its subsidiaries, unless the context otherwise requires. References herein to fiscal year refer to our fiscal years ended or ending October 31.

Our condensed consolidated financial statements include the accounts of Toll Brothers, Inc. (the “Company,” “we,” “us,” or “our”), a Delaware corporation, and its majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Investments in 50% or less owned partnerships and affiliates are accounted for using the equity method unless it is determined that we have effective control of the entity, in which case we would consolidate the entity.

In March 2020,November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, “Reference Rate ReformNo. 2023-07, “Segment Reporting (Topic 848),” as amended by 280): Improvements to Reportable Segment Disclosures” (“ASU 2021-01 in January 20212023-07”). ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and ASU 2022-06 in December 2022 (“ASC 848”), directly addressingincluded within each reported measure of segment profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the effects of reference rate reform on financial reporting as a resulttitle and position of the cessationentity’s CODM. The amendments in this update also expand the interim segment disclosure requirements. ASU 2023-07 will be effective for our fiscal year ending October 31, 2025 and for interim periods starting in our first quarter of fiscal 2026. Early adoption is permitted and the publication of certain London Interbank Offered Rate (“LIBOR”) rates beginning December 31, 2021. The guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform by virtue of referencing LIBOR or another reference rate expectedamendments in this update are required to be discontinued. This guidance became effectiveapplied on March 12, 2020 and can be adopted no later than December 31, 2024, with early adoption permitted.a retrospective basis. We elected to applyare currently reviewing the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assumeimpact that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Applicationadoption of these expedients preserves the presentation of derivatives consistent with past presentation. We continue to evaluate the impact of the guidanceASU 2023-07 may have on our consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which requires expanded disclosure of our income tax rate reconciliation and income taxes paid. ASU 2023-09 will be effective for our fiscal year ending October 31, 2026 and may apply other elections as applicable as additional changes in the market occur.be applied either retrospectively or prospectively. We are currently evaluating ASU 2023-09 and do not expect it to have a material effect on our consolidated financial statements and disclosures.

Certain prior period amounts have been reclassified to conform to the fiscal 20232024 presentation.

Operating communities include communities offering homes for sale; communities that have sold all available home sites but have not completed delivery of the homes and communities preparing to open for sale. The carrying value attributable to

operating communities includes the cost of homes under construction, land and land development costs, the carrying cost of home sites in current and future phases of these communities, and the carrying cost of model homes.

Backlog consists of homes under contract but not yet delivered to our home buyers (“backlog”).

We have also recognized $13.0 million of land impairment charges on land held for sale included in land sales and other cost of revenues during the three-month period ended January 31, 2023. No similar chargesamounts were recognized duringin the three-month period ended January 31, 2022.2024.

See Note 13, “Commitments and Contingencies,” for information regarding land purchase commitments.

At January 31, 2023,2024, we evaluated our land purchase contracts, including those to acquire land for apartment developments, to determine whether any of the selling entities were variable interest entities (“VIEs”) and, if they were, whether we were the

Interest incurred, capitalized, and expensed, for the periods indicated, waswere as follows (amounts in thousands):

We have investments in various unconsolidated entities and our ownership interest in these investments ranges from 5.0% to 50%. These entities are structured as joint ventures and either: (i) develop land for the joint venture participants and for sale to outside builders (“Land Development Joint Ventures”); (ii) develop for-sale homes (“Home Building Joint Ventures”); (iii) develop luxury for-rent residential apartments and single family homes, commercial space, and a hotel (“Rental Property Joint Ventures”); or (iv) provide financing and land banking to residential builders and developers for the acquisition and development of land and home sites (“Gibraltar Joint Ventures”).

More specific and/or recent information regarding our investments in, advances to, and future commitments to these entities is provided below.

The unconsolidated entities in which we have investments generally finance their activities with a combination of partner equity and debt financing. In some instances, we have guaranteed portions of the debt of unconsolidated entities. These guarantees may include any or all of the following: (i) project completion guarantees, including any cost overruns; (ii) repayment guarantees, generally covering a percentage of the outstanding loan; (iii) carry cost guarantees, which cover costs such as interest, real estate taxes, and insurance; (iv) an environmental indemnity provided to the lender that holds the lender harmless from and against losses arising from the discharge of hazardous materials from the property and non-compliance with applicable environmental laws; and (v) indemnification of the lender from “bad boy acts” of the unconsolidated entity or its partners.

In some instances, we and our joint venture partner have provided joint and several guarantees in connection with loans to unconsolidated entities. In these situations, we generally seek to implement a reimbursement agreement with our partner that provides that neither party is responsible for more than its proportionate share or agreed upon share of the guarantee; however, we are not always successful. In addition, if the joint venture partner does not have adequate financial resources to meet its obligations under such a reimbursement agreement, we may be liable for more than our proportionate share.

We believe that, as of January 31, 2023,2024, in the event we become legally obligated to perform under a guarantee of an obligation of an unconsolidated entity due to a triggering event, the collateral in such entity should be sufficient to repay a significant portion of the obligation. If it is not, we and our partners would need to contribute additional capital to the venture.

Our ownership interest in the above consolidated Joint Venture VIEs ranges from 80%82% to 98%.

As shown above, we are the primary beneficiary of certain VIEs due to our controlling financial interest in such ventures as we have the power to direct the activities that most significantly impact the joint ventures’ performance and the obligation to absorb expected losses or receive benefits from the joint ventures. The assets of these VIEs can only be used to settle the obligations of the VIEs. In addition, in certain of the joint ventures, in the event additional contributions are required to be funded to the joint ventures prior to the admission of any additional investor at a future date, we will fund 100% of such contributions, including our partner’s pro rata share, which we expect would be funded through an interest-bearing loan. For other VIEs, we are not the primary beneficiary because the power to direct the activities of such VIEs that most significantly impact their performance was either shared by us and such VIEs’VIE’s other partners or such activities were controlled by our partner. For VIEs where the power to direct significant activities is shared, business plans, budgets, and other major decisions are required to be unanimously approved by all partners. Management and other fees earned by us are nominal and believed to be at market rates, and there is no significant economic disproportionality between us and other partners.

The Condensed Combined Balance Sheets, as of the dates indicated, and the Condensed Combined Statements of Operations, for the periods indicated, for the unconsolidated entities in which we have an investment are included below (in thousands):

We are party to a $650.0 million senior unsecured term loan facility (the “Term Loan Facility”) with a syndicate of banks. On October 31, 2021, we entered into term loan extension agreements to extend the maturity datebanks of $548.4which $487.5 million of outstanding term loans from November 1, 2025 tomatures February 14, 2028, $60.9 million matures on November 1, 2026 withand the remainder of the term loans remaining due$101.6 million matures on November 1, 2025. At January 31, 2023, other than $101.6 million of term loans that were scheduled to mature on November 1, 2025, there wereThere are no payments required before the finalthese stated maturity date on the Term Loan Facility.dates. At January 31, 2023,2024, the interest rate on the Term Loan Facility was 5.37%6.21% per annum. WeToll Brothers, Inc. and substantially all of ourits 100%-owned home building subsidiaries are guarantors under the Term Loan Facility. The Term Loan Facility contains substantially the same financial covenants as the Revolving Credit Facility described below.

In November 2020, we entered into five interest rate swap transactions to hedge $400.0 million of the Term Loan Facility. The interest rate swaps effectively fix the interest cost on the $400.0 million at 0.369% plus the spread set forth in the pricing schedule in the Term Loan Facility through October 2025. The spread at January 31, 20232024 was 0.80%0.90%. These interest rate swaps were designated as cash flow hedges.

At January 31, 2023,2024, we had a $1.905 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”) with a syndicate of banks. On October 31, 2021, we entered into extension letter agreements which extended the maturity date of $1.78 billion of the revolving loans and commitments under thebanks that is scheduled to mature on February 14, 2028. The Revolving Credit Facility from November 1, 2025provides us with a committed borrowing capacity of $1.905 billion, which we have the ability to November 1, 2026,increase up to $3.00 billion with the remainderconsent of the revolving loans and commitments terminating on November 1, 2025. Welenders. Toll Brothers, Inc. and substantially all of ourits 100%-owned home building subsidiaries wereare guarantors of the borrower’s obligations under the Revolving Credit Facility.

Under the terms of the Revolving Credit Facility, at January 31, 2023,2024, our maximum leverage ratio, as defined, was not permitted to exceed 1.75 to 1.00, and we were required to maintain a minimum tangible net worth, as defined, of no less than approximately $4.00$4.07 billion. Under the terms of the Revolving Credit Facility, at January 31, 2023,2024, our leverage ratio was approximately 0.380.32 to 1.00, and our tangible net worth was approximately $6.15$6.97 billion. Based upon the terms of the Revolving Credit Facility, our ability to repurchase our common stock was limited to approximately $3.55$3.85 billion as of January 31, 2023.2024. In addition, under the provisions of the Revolving Credit Facility, our ability to pay cash dividends was limited to approximately $2.15$2.89 billion as of January 31, 2023.2024.

At January 31, 2023,2024, we had no outstanding borrowings under the Revolving Credit Facility and had approximately $120.4$146.1 million of outstanding letters of credit that were issued under the Revolving Credit Facility. At January 31, 2023,2024, the interest rate on outstanding borrowings under the Revolving Credit Facility would have been 5.67%6.51% per annum.

“Loans payable – other” primarily represents purchase money mortgages on properties we acquired that the seller had financed, project-level financing, and various revenue bonds that were issued by government entities on our behalf to finance community infrastructure and our manufacturing facilities. At January 31, 2023,2024, the weighted-average interest rate on “Loans payable – other” was 4.19%5.38% per annum.

At January 31, 2023,2024, we had fivefour issues of senior notes outstanding with an aggregate principal amount of $2.00$1.60 billion.

Toll Brothers Mortgage Company (“TBMC”), our wholly owned mortgage subsidiary, hashad a mortgage warehousing agreement (the “Warehousing Agreement”) with a bank, which has beenwas amended from time to time, to finance the origination of mortgage loans by TBMC. The Warehousing Agreement iswas accounted for as a secured borrowing under ASC 860, “Transfers and Servicing.” The Warehousing Agreement providesprovided for loan purchases up to $75.0 million, subject to certain sublimits. In addition, the Warehousing Agreement providesprovided for an accordion feature under which TBMC maycould request that the aggregate commitments under the Warehousing Agreement be increased to an amount up to $150.0 million for a short period of time. In April 2022,Borrowings under the Warehousing Agreement was amended and restated to extend the expiration date to March 31, 2023 and borrowings thereunder bearbore interest at the Bloomberg Short-Term Bank Yield Index Rate (“BSBY”)BSBY plus 1.75% per annum (with a BSBY floor of 0.50%). The Warehousing Agreement was terminated in January 2024.

On December 5, 2023, TBMC executed a new Warehousing Agreement (“New Warehousing Agreement”) with a bank which provides for loan purchases up to $75.0 million, subject to certain sublimits. In addition, the New Warehousing Agreement, provides for an accordion feature under which TBMC may request that the aggregate commitments under the New Warehousing Agreement be increased to an amount up to $150.0 million for a short period of time. The New Warehousing Agreement was accounted for as a secured borrowing under ASC 860, “Transfers and Servicing.” TMBC is also subject to an under usage fee based on outstanding balances, as defined in the New Warehousing Agreement. The New Warehousing Agreement is set to expire on December 3, 2024 and bears interest at SOFR plus 1.75% per annum (with a SOFR floor of 2.50%). At January 31, 2023,2024, the interest rate on the New Warehousing Agreement was 6.26%7.10% per annum.