Carrier Wheeler, CEO, Opendoor.
Illustration by Lanette Behiry/Real Estate News

As revenue falls, Opendoor returns to profitability 

The top iBuyer hopes scaling home purchases, improving margins and leveraging partnerships will continue fueling its return to positive net income.

Updated August 5, 2023
3 minutes

Leading iBuyer Opendoor posted mixed results while signaling optimism for the near future during its earnings call today. Similar to competitor Offerpad, Opendoor has seen its revenue plunge over the past year, posting $2 billion in revenue for the most recent quarter compared to more than $4 billion in the same period last year. 

While overall revenue is down, the San Francisco-based company has stemmed losses. This past quarter, Opendoor reported a net income of $23 million, a significant turnaround compared to the staggering losses of $101 million from the previous quarter and a reported $399 million loss in Q4 of 2022

Also like Offerpad, Opendoor has begun scaling up its inventory, acquiring 2,680 homes this past quarter compared to just 1,747 in Q1. The company's overall inventory, however, is at the lowest point in a year, going from over 17,000 homes at the end of Q2 2022 to 3,558 homes today. 

Key numbers

Revenue: $2 billion, down 37% from $3.1 billion from Q1 2023 and down 53% from $4.2 billion in Q2 2022.

Cash and cash equivalents: $1.1 billion, which remains relatively unchanged from 2022 year-end. 

Gross profit: $149 million. 

Net income/loss: Income of $23 million, a big improvement over the loss of $101 million in the previous quarter and a $54 million loss in Q2 2022.

EBITDA (earnings before interest, taxes, depreciation and amortization): A loss of $168 million, which is an improvement compared to the $341 million loss in the first quarter of this year, but still a substantial drain compared to the $218 million gain from Q2 2022.

Homes acquired: 2,680, an 81% drop compared to Q2 last year but a 53% improvement over Q1 2023.

Homes sold: 5,383, a 35% drop compared to Q1 2023 and a 49% drop compared to Q2 2022.

Inventory: 3,558 homes, which Opendoor values at roughly $1.1 billion, which is down 83% from the same period a year ago.

What Opendoor had to say

The company had been disciplined with its spending in recent months to help reduce losses, and plans to continue improving its margin on home deals, which will play a major role in maintaining profitability.

"We delivered $2 billion of revenue in the second quarter that exceeded the high end of our revenue guidance by 7%, driven by strong market clearance rates and the sell-through of our longer dated homes," CEO Carrie Wheeler said during today's call with shareholders.

"We expect to return to positive contribution margins in 3Q23," Wheeler also noted. "We remain committed to deliver at least 100 bps (basis points) of contribution margin improvement by 2024, increasing our annual target range to 5% to 7%, with a goal of eventually returning to positive adjusted net income."

Notable moves

Opendoor execs also highlighted the importance of partnership channels, which "represented 40% of total acquisition contracts" in the last quarter.

"Acquisition contracts from our partnership channels saw 78% sequential growth in 2Q23," the shareholder report stated. "In April, we deepened our Agent Access program with incentives and expanded our agent referral program. We have national partnerships with the three largest online real estate platforms — Zillow, Redfin and — which collectively reach millions of unique monthly visitors. At the end of 2Q23, our exclusive partnership with Zillow was live in 25 markets and continuing to ramp."

Correction: A previous version of this story incorrectly reported a net loss of $23 million in Q2 rather than a net income of $23 million.

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