Opendoor's Stock Plummets 20% After Disappointing Earnings Forecast

Opendoor Technologies' stock price has dropped over 20% in premarket trading after the company reported disappointing Q2 2025 results, including a net loss of $29 million and a 51% decrease in home purchases. The company also issued revenue guidance of $800 million to $875 million for Q3, a 36% decline from the same period last year. The stock's volatility may be attributed to its status as a meme stock.

Opendoor Technologies' stock price has dropped over 20% in premarket trading after the company reported its Q2 2025 results. The company reported a net loss of $29 million and a 51% decrease in home purchases. Revenue guidance for Q3 was issued at $800 million to $875 million, a 36% decline from the same period last year. The stock's volatility may be attributed to its status as a meme stock [1].

The company's Q2 results showed revenue of $1.6 billion, which was down 0.7% year-on-year. Adjusted EBITDA was $23 million, compared to a loss of $5 million in Q2 2024. Contribution profit was $69 million, with a contribution margin of 4.4%. Homes purchased totaled 1,757 in the second quarter, with a net inventory of 4,538 homes valued at $1.5 billion. Total capital reached $1.1 billion, including $789 million in unrestricted cash. The company's non-recourse asset-backed borrowing capacity was $7.8 billion, with $2 billion committed. Convertible senior notes issued totaled $325 million, due in 2030 [2].

The company's guidance for Q3 2025 indicates a decline in revenue and contribution margin, reflecting ongoing macroeconomic challenges. The housing market's deterioration, with high mortgage rates suppressing buyer demand, has led to lower acquisition and resale volumes. The company's new initiatives, such as Cash Plus, are designed to provide better risk-adjusted products and align incentives more closely with customers. However, the impact of these initiatives may not be fully realized in the near term [3].

Investors should closely monitor the earnings call for any updates on the company's growth strategies. As of the current date, the stock price of OPEN remains volatile, reflecting the market's anticipation of the earnings report. The company has a history of beating revenue and EPS estimates, having done so 75% of the time over the last year [2].

References:
[1] https://finance.yahoo.com/news/opendoor-stock-price-drops-housing-123300099.html
[2] https://www.ainvest.com/news/opendoor-technologies-q2-2025-earnings-preview-revenue-expectations-0-7-2508/
[3] https://finance.yahoo.com/news/opendoor-technologies-q2-2025-earnings-preview-revenue-expectations-0-7-2508/