Real estate developer Howard Hughes Holdings (NYSE: HHH) announced better-than-expected revenue in Q3 CY2025, with sales up 19.3% year on year to $390.2 million. Its GAAP profit of $2.02 per share was 32% above analysts’ consensus estimates.

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“Our third-quarter performance underscores the strength of our real estate platform as Howard Hughes continues its transition into a premier holdings company,” commented David R. O’Reilly, Chief Executive Officer of Howard Hughes.

Company Overview

Named after the eccentric business magnate and aviator whose legacy lives on in real estate development, Howard Hughes Holdings (NYSE: HHH) develops, owns, and manages master-planned communities and commercial properties across the United States.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Over the last five years, Howard Hughes Holdings grew its sales at a 17.6% annual rate. Although this growth is acceptable on an absolute basis, it fell slightly short of our standards for the consumer discretionary sector, which enjoys a number of secular tailwinds.

Long-term growth is the most important, but within consumer discretionary, product cycles are short and revenue can be hit-driven due to rapidly changing trends and consumer preferences. Howard Hughes Holdings’s annualized revenue growth of 27.4% over the last two years is above its five-year trend, but we were still disappointed by the results.

This quarter, Howard Hughes Holdings reported year-on-year revenue growth of 19.3%, and its $390.2 million of revenue exceeded Wall Street’s estimates by 15.7%.

Looking ahead, sell-side analysts expect revenue to grow 18% over the next 12 months, a deceleration versus the last two years. Despite the slowdown, this projection is commendable and suggests the market sees success for its products and services.

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Operating Margin

Howard Hughes Holdings’s operating margin has been trending down over the last 12 months and averaged 33.3% over the last two years. The company’s profitability was mediocre for a consumer discretionary business and shows it couldn’t pass its higher operating expenses onto its customers.

This quarter, Howard Hughes Holdings generated an operating margin profit margin of 48.6%, down 12 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Howard Hughes Holdings’s full-year EPS flipped from negative to positive over the last five years. This is encouraging and shows it’s at a critical moment in its life.

In Q3, Howard Hughes Holdings reported EPS of $2.02, up from $1.46 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. We also like to analyze expected EPS growth based on Wall Street analysts’ consensus projections, but there is insufficient data.

Key Takeaways from Howard Hughes Holdings’s Q3 Results

It was good to see Howard Hughes Holdings beat analysts’ EPS expectations this quarter. We were also excited its revenue outperformed Wall Street’s estimates by a wide margin. On the other hand, its revenue missed. Zooming out, we think this quarter featured some important positives. The stock remained flat at $79.72 immediately after reporting.

So should you invest in Howard Hughes Holdings right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.