On August 1, 2024, Opendoor Technologies Inc (OPEN, Financial) released its 8-K filing for the second quarter of 2024. Opendoor Technologies Inc is a digital platform for residential real estate, enabling customers to buy and sell houses online. The company generates revenue primarily through home sales and other real estate services.
Q2 2024 Financial Performance
Opendoor Technologies Inc reported revenue of $1.5 billion for Q2 2024, surpassing the analyst estimate of $1.468 billion. This represents a 28% increase from Q1 2024 but a 24% decrease compared to Q2 2023. The company sold 4,078 homes during the quarter, a 32% increase from Q1 2024 but a 24% decrease from Q2 2023.
Gross profit for the quarter was $129 million, down from $149 million in Q2 2023 but up from $114 million in Q1 2024. The gross margin stood at 8.5%, compared to 7.5% in Q2 2023 and 9.7% in Q1 2024. The net loss for Q2 2024 was $92 million, a significant improvement from the $109 million loss in Q1 2024 but a reversal from the $23 million net income in Q2 2023.
Key Financial Metrics
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Revenue | $1.5 billion | $1.18 billion | $1.98 billion |
| Gross Profit | $129 million | $114 million | $149 million |
| Net (Loss) Income | $(92) million | $(109) million | $23 million |
| Homes Sold | 4,078 | 3,078 | 5,383 |
| Homes Purchased | 4,771 | 3,458 | 2,680 |
Operational Highlights
Opendoor Technologies Inc's inventory balance at the end of Q2 2024 was $2.2 billion, representing 6,399 homes, a 94% increase from Q2 2023 and a 19% increase from Q1 2024. The company purchased 4,771 homes in Q2 2024, up 78% from Q2 2023 and 38% from Q1 2024. However, the number of homes under contract for purchase decreased by 31% from Q1 2024, ending the quarter with 1,793 homes under contract.
Non-GAAP Financial Measures
Opendoor Technologies Inc reported a Contribution Profit of $95 million for Q2 2024, compared to a loss of $90 million in Q2 2023 and a profit of $57 million in Q1 2024. The Contribution Margin was 6.3%, up from -4.6% in Q2 2023 and 4.8% in Q1 2024. Adjusted EBITDA was $(5) million, a significant improvement from $(168) million in Q2 2023 and $(50) million in Q1 2024. The Adjusted Net Loss for Q2 2024 was $(31) million, compared to $(197) million in Q2 2023 and $(80) million in Q1 2024.
Management Commentary
"We are proud of our second quarter performance and the progress we’ve made in building a platform where all customers can begin their home selling journey. Revenue, Contribution Margin, and Adjusted EBITDA exceeded the high end of our guidance, and our acquisitions outperformed expectations, growing nearly 80% year-over-year," said Carrie Wheeler, CEO of Opendoor.
"During the back half of the second quarter, we began responding to signals that indicated additional slowing in the housing market. We are making decisions that appropriately balance growth, margin, and risk in what continues to be a challenging environment," Wheeler added.
Financial Outlook
For Q3 2024, Opendoor Technologies Inc provided revenue guidance of $1.2 billion to $1.3 billion. The company also expects a Contribution Profit of $35 million to $45 million and Adjusted EBITDA of $(70) million to $(60) million.
Opendoor Technologies Inc's performance in Q2 2024 highlights its ability to navigate a challenging housing market while making strategic decisions to balance growth, margin, and risk. The company's focus on increasing acquisitions and reducing adjusted net losses is expected to drive future performance improvements.
Explore the complete 8-K earnings release (here) from Opendoor Technologies Inc for further details.
