Q3 2025 Opendoor Technologies Inc Earnings Call

November 6, 2025

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Speaker #1: Annual Report on Form 10-K for the year ended December 31st , 2024 , as updated by our Quarterly Report on Form 10-q for the quarter ended June 30th , 2025 and September 30th , 2025 , and other filings with the SEC .

Speaker #1: Nice prices of $9 , $13 and $17 . Zooming out , we believe we have the right capital setup for the open Door 2.0 operating model .

Speaker #1: Higher volumes , faster turns , tighter spreads , and more products to serve homeowners . Now , let me tell you how we're executing against that model and how you can hold us accountable .

Speaker #1: Any forward looking statements made on this webcast , including responses to your questions , are based on management's reasonable current expectations and assumptions .

Speaker #1: As of today , and Opendoor assumes no obligation to update or revise them , whether as a result of new information , future events or otherwise .

Speaker #1: We are targeting to reach adjusted net income profitability by the end of 2026 , measured on a forward 12 month basis . To get there , we're focused on three key management objectives that we monitor internally for each objective , I want to frame for you why this matters .

Speaker #1: Except as required by law . The following discussion contains references to certain non-GAAP financial measures . The company believes these non-GAAP financial measures are useful to investors as supplemental operational measurements to evaluate the company's financial performance for reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP metric .

Speaker #1: What we're doing and how you can hold us accountable . First , scale , high quality acquisitions , more volume means more revenue from transactions and ancillary services , plus better leverage of our cost base .

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Speaker #1: Please see our website at investor . Com . With that , let's get into the open house with Kaz and Kristi .

Uh huh.

Okay.

Speaker #1: Further , market concentration creates a flywheel . When we own meaningful share in a market , we attract more inventory , which attracts more buyers , which attracts more sellers .

Speaker #2: Good afternoon . My name is Kaz and Jackson . I'm a computer nerd turned lawyer turned founder , but I think of myself primarily as a product manager .

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Speaker #1: We have multiple initiatives underway to drive this growth . Most importantly , as Kaz described earlier , we started reducing our average spread while increasing our operational rigor in selection .

Speaker #2: That's what I've spent most of my career doing building products and leading teams to build better products faster . I'm not the guy you invite your place if you want someone to bring the party .

Speaker #1: Stronger offers for high velocity , high quality homes . Discipline on higher risk homes . We're pairing that with AI driven scoping and standardized pre-offer inspections to raise conversion and cut time and costs from offer to acquisition .

Speaker #2: I'm the guy you invite to party . If you want someone to fix your Sonos . On my first day at work , I told our team at Opendoor that we're going to make a bunch of changes and that the new open door would look nothing like the old one .

Speaker #1: You can track our progress against our acquisition goals through the end of 2026 on our new dashboard at accountable . Individual weeks will fluctuate .

Speaker #2: And that's because , well , the old open door had kind of lost its way . Before I tell you why , I think open door was broken , let me share you one example of a thing that has changed .

Speaker #1: Holidays , weather , local market events . We'll be focused on the trajectory over time . Second , improve unit economics and resale velocity , speed , and profitability per transaction .

Speaker #2: Just in the last few weeks . So you can get a sense of the scale of the change . Look , on my first day at work on September 15th .

Speaker #1: Enable us to build a sustainable business while enduring macroeconomic changes . Higher profitability per transaction gives us the ability to decrease the spreads embedded in our offers , leading to more acquisitions .

Okay.

Speaker #2: Open Door had entered into contracts to buy 120 homes in the prior seven days . By last week of October , that number had risen to 230 homes .

Okay.

Yes.

Speaker #1: This objective is supported by our tailored Spread framework , by pricing more aggressively for high quality , faster selling homes and maintaining discipline on higher risk assets .

Speaker #2: In seven weeks . We nearly doubled our speed of acquisition . I think it's reasonable to ask , how can we move so fast right now ?

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Thank you.

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Speaker #1: We expect our acquisition mix to skew toward more marketable homes that need less repair and renovation . We expect this to shorten the time from acquisition to listing and days on market , thereby reducing our holding costs .

Speaker #2: When we used to move so goddamn slowly , if you give me a couple of minutes , I'd like to tell you what caused the old open door to be so broken .

Speaker #2: I think this diagnosis will kind of matter in how we rebuild . Open door . Having been inside the company for just over a month , it's kind of obvious to me that the old open door had just lost faith in the power of software to make selling , buying and owning a home easier .

Speaker #1: Second , we are innovating at an incredible pace with a renewed focus on execution and a culture of challenging everything to be better .

Speaker #1: Much of our product innovation is designed to automate workflows and increase resale velocity , supporting a business model focused on turns , not spread .

Speaker #1: You can hold us accountable to improving resale velocity by tracking the percentage of open door homes on the market for greater than 120 days , which we report quarterly in our 10-q .

Speaker #2: It just kind of thought of itself as an asset manager , trying to predict the economy and the previous open door also didn't really believe in the power of AI to do anything , much less to make our work less toilsome .

Speaker #1: You can also follow our product feature and partnership launches on accountable to see how we're building with velocity into the business . Third , build operating leverage .

Speaker #2: When I joined the team , I'm not kidding . There were a dozen people whose only job it was to copy and paste information from PDFs into a glorified spreadsheets .

Speaker #1: We will scale transactions faster than fixed costs . So each additional home adds accretive profit . We're cutting aggressively in the right places , eliminating consultants , removing redundant tools and software , reducing marketing waste , and streamlining operations while simultaneously reinvesting a portion of those savings into engineering and AI automation .

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Hmm.

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Speaker #2: The previous open door also didn't really believe in itself . I was genuinely shocked when I found out that one of open Doors biggest expenses in the first half of this year was millions of dollars paid to a well-known consulting firm to tell Open Door how to do its job .

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Speaker #1: Importantly , we expect to shift our overall operating expense profile toward variable components that flex with volumes rather than remain fixed through cycles .

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Speaker #2: Everywhere I looked in my first 30 days , I found consultants making decisions that should have been made by executives . Finally , the previous open door had become so risk averse that it no longer really believed in buying and selling homes .

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Speaker #1: You can hold us accountable by tracking two specific metrics we report quarterly and our 10-q . Fixed operating expenses should hold relatively steady as we rescale volumes and trailing 12 month operations expense as a percentage of 12 , trailing 12 month revenue should hold relatively steady or decrease over time .

Everyone I'd like to welcome you all to open doors inaugural open House earnings live stream and Michael Jud opened or as head of Investor Relations.

Housekeeping items before we get started.

Speaker #2: If you ignore Covid , we bought fewer homes in Q3 than we have since 2017 , when Open Door was just a tiny startup .

As our results and additional management commentary are available in our earnings release, which can be found at investor <unk> Dot com.

Speaker #1: These three objectives are the foundation of our path to profitability , and we're building in the open so you can track our progress along the way .

Following discussion contains forward looking statements within the meaning of the federal Securities laws. All statements other than statements of historical fact are statements that could be deemed forward looking including but not limited to statements regarding <unk> financial condition anticipated financial performance business strategy and plans market opportunity and expansion and management objectives for future operations. These statements are neither promised.

Speaker #2: Look , in the last few weeks , we've reversed course on all these decisions . We are ditching manager mode . We're now firmly in founder mode .

Speaker #1: Turning to our outlook , our guidance is going to look different than what you've seen in previous quarters . Our business is changing rapidly .

Speaker #1: Just in the past few weeks , our acquisition contract speed increased by nearly two x . We're focused on execution and outcomes , not on benchmarking .

Speaker #2: We are rebounding this company . This is Open Door 2.0 and we believe different things . So what do we believe at Open Door today ?

Nor guarantees and undue reliance should not be placed on them such forward looking statements involve risks and uncertainties that may cause actual results to differ materially from those discussed here additional information that could cause actual results to differ from forward looking statements can be found in the risk factors section of open doors. Most recent annual report on Form 10-K for the year ended December 31 2024.

Speaker #1: Every turn during a transformation of this scale , our results in the upcoming quarter are largely the outcome of us managing decisions that were made several months ago .

Speaker #2: We believe that we have to use all of our energy and every tool at our disposal to build products that make home ownership easier .

Speaker #1: We're focused now on making the right long term decisions for the business , not managing the short term guidance . What matters and what we want to be held accountable for are the actions we take from here and the results they drive over time .

Speaker #2: And less friction for . We believe we're a software company , and our leverage comes from engineers writing code . We believe machines are better at pricing assets than humans .

Aided by our quarterly report on Form 10-Q for the quarters ended June 30th 25 at September 30 of 2025 and other filings with the SEC.

Speaker #1: Our destination is clear adjusted net income , profitability . By the end of next year , measured on a 12 month go forward basis .

Speaker #2: We believe AI will empower us to avoid toil , full work , and we can have a leaner and more aggressive company . We believe we are here to make hard decisions , and we will never , ever advocate that responsibility to management consultants .

Any forward looking statements made on this webcast, including responses to your questions are based on management's reasonable current expectations and assumptions as of today and open door assumes no obligation to update or revise them, whether as a result of new information future events or otherwise except as required by law. The following discussion contains references to certain non-GAAP financial measures. The company believes these non-GAAP.

Speaker #1: We've already seen the levers in this business work . You can't build a break even business in a spreadsheet . You build it by shipping product , operating with discipline and learning from the market for the near term , I will provide you with these Guideposts .

Speaker #2: We believe in being operationally excellent , especially in marketing and corporate functions . When I was at Shopify , I insisted that we manage our marketing dollars like a hedge fund would manage its IRR .

Speaker #1: Acquisition . Rescaling . We're committed to rescaling acquisition volumes . We expect fourth quarter 2025 acquisitions to increase by at least 35% from Q3 , as our product launches and pricing strategy changes take hold .

Financial measures are useful to investors as supplemental operational measurements to evaluate the company's financial performance for a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP metric. Please see our website at investor <unk> Dot com with that let's get into the open house with CASM Christy. Good afternoon. My name is Katherine Jackson.

Speaker #2: We're going to do the same thing here . We're going to spend money only on channels that give us great payback , and we're going to stop , spray and pray .

Speaker #1: You can track our weekly acquisition progress at Accountable . Store.com revenue . We expect Q4 higher from the outlook we provided at Q2 earnings , but decrease approximately 35% quarter over quarter due to low inventory levels from Q3 , reduced acquisition volumes , contribution margin , our priority since mid-September has been to clear old inventory homes selected under the previous strategy that prioritized spread over quality .

Speaker #2: Marketing . We believe slowing down , buying homes just to buy them at a significant spread is a bad strategy . Look , the only folks who are going to sell their house at a large spread are people who know things that you don't know .

Computer Nerd turned lawyer turns thunder, but I was thinking myself, primarily as a product manager.

That's what I've spent most of my career doing building products and leading teams to build better products faster.

Speaker #2: They want to get rid of their house as fast as possible. This is the definition of adverse selection. It's not a buying opportunity.

I'm not the Guy you invite your place if you want someone to bring the party.

Speaker #1: That's pressured our contribution margin sequentially . Since April through October . And we believe we bottomed out in October . Margins will improve through the end of the year as we replace legacy inventory with better homes .

And the Guy you invite your party if you want someone to fix your stonehouse on.

Speaker #2: It's a massive red flag to use . Wall Street terms . Opendoor is going to be kind of like a market maker in the future , not a prop desk .

On my first day at work I told our team at open door that we're going to make a bunch of changes and that the new open door would look nothing like the old button.

Speaker #1: But Q4 contribution margin will revenue to be below Q3 as we reverse the downward trend . Cost discipline . We are focused on continuing to manage and improve our cost structure adjusted operating expenses for the 12 months ended June 30th , 2025 were 307 million for the 12 months ending June 30th , 2026 , we expect to spend 255 million to 265 million , excluding the 15 million cash , award for our CEO .

Speaker #2: We're going to profit from flow , speed and tight spreads . Not on bets on the direction of the economy . Our business plan is simple buy and sell lots and lots of homes quickly .

And that's because well.

The old open door kind of lots of its weight.

Before I tell you why I think open door. It was broken let me show you. One example of the thing that has changed just in the last few weeks. So you can get a sense of the scale of the change.

Speaker #2: The operationally excellent and increase our value to each homeowner by launching services like mortgage , insurance and warranty . Starting last month , we reduced our spreads while simultaneously stepping up operational rigor and tightening our selection discipline .

On my first day at work on September 15th opened or had energy entered into contract to buy 120 homes in the prior seven days.

Speaker #1: This is a year over year decrease of approximately 62 million , or 20% , at the midpoint . We expect to achieve these savings while concurrently investing in engineering and AI automation to drive further operating leverage .

Speaker #2: The goal is simple we're going to make stronger first offers , buy more good homes and get more good sellers through our funnel to avoid adverse selection .

By last week of October that number had risen to 230 homes in seven weeks, we nearly doubled our speed of acquisition.

Speaker #1: We're cutting the waste and reinvesting in what matters . Finally , adjusted EBITDA given the near margin pressure , as we clear old inventory , we expect Q4 2025 adjusted EBITDA loss in the high 40 millions to mid 50 million .

I think it's reasonable to ask it.

Speaker #2: We're building our inspection process from ground up , structured in app , video and audio feed . It goes directly into AI that creates condition profiles that are validated through a standardized inspection process that give us great data .

How can we move so fast right now.

We used to move so goddamn slowly.

If you give me a couple of minutes.

I'd like to tell you what caused the old open door to be so broken.

I think this diagnosis will kind of matter and how we've rebuilt open door.

Speaker #1: We're building Opendoor 2.0 in the open , holding ourselves accountable to measurable objectives and giving you the transparency to track our progress . The journey won't be perfectly linear , but our conviction in the destination and in the levers that get us there is unwavering .

Speaker #2: The result is going to be a consistent , high fidelity view of every single home . This trust but verify approach is going to improve the speed and the quality of homes , while giving us amazing data to adjust our process , allowing us to grow our portfolio without sacrificing pricing discipline , without giving up on asset quality , and without slowing down transaction velocity .

Having been inside the company for just over a month.

Kind of obvious to me.

Old opened or had just lost faith in the power of software to make selling buying and owning a home easier.

Speaker #1: With that , I'll turn it over to you for questions .

Speaker #2: Great , thanks , Kristie . Our first question comes to us from video submission from Vlad Tenev .

Kind of thought of itself as an asset manager trying to predict the economy.

And the previous open door also didn't really believe in the power of AI to do anything much less to make our work less toil.

Speaker #3: What's up Kaz ? By the way , we're super pumped that you guys are streaming live to retail on Robinhood . I think the question on everyone's mind is what's going on with tokenization ?

Speaker #2: But buying a great home isn't the end of our job , right ? It's also important that when Opendoor buys a house , we provide value and services to both buyers and sellers .

When I joined the team I'm not kidding.

Speaker #3: How real is it and how do you think it could revolutionize the homeownership experience ?

There were a dozen people, whose only job it was to copy and paste information from PBS into glorified spreadsheets.

Speaker #2: That's why earlier this week , we launched Opendoor Checkout . It's available in select markets now , and it's going to expand to our entire inventory soon .

Speaker #4: Thanks . A lot . Thanks for hosting us . Look , I'm such a big fan of Robinhood , and I hope that we can continue to do things together .

The previous open door also didn't really believe in itself I was genuinely shocked when I found out that one off open doors biggest expenses in the first half of this year was millions of dollars paid to a well known consulting firm to tell open door, how would you do its job.

Speaker #2: A buyer can walk into an open door home , tour it , and place an offer to buy it on Opendoor without ever talking to a human being .

Speaker #4: Our mission at Opendoor is to tilt the world towards homeowners and those working hard to become homeowners . And I love that Robinhood does some of the same things .

Speaker #2: We're shipping the buy now button for homes on the internet . We're going to improve on this . We're going to add more products and more features for homeowners to simplify the home buying experience , starting with mortgages and warranties .

Speaker #4: You know , this whole thing of taking power away from fancy people and giving it to average person . Now , to answer your question .

We were I looked in my first 30 days I found consultants, making decisions. They should have been made by executives.

Speaker #4: Look , I have a habit of of not announcing products before they're launched . That's because I build products , not spreadsheets . And I think it's important that we ship things before we talk about them .

Finally, the previous open door had become sole risk averse.

Speaker #2: Look , in the future , buying a home will be as seamless as buying a car from Tesla . You'll choose your home , your financing , your warranty , your insurance all in one place .

No longer really believed in buying and selling homes.

If you ignore COVID-19.

Speaker #4: And I don't want to say we're going to do this next week , but I genuinely can't imagine a future where real estate not tokenized .

Bought fewer homes in Q3, eight and we have since 2017 when opened or was just a tiny startup.

Speaker #2: All in one flow . Right now , homeowners have to deal with a bunch of different companies , brokers , agents , a lot of different stuff to get what they need for a house .

Speaker #4: And I also can't imagine a future where Opendoor isn't leading innovation in real estate . Look , asset tokenization is not a side quest for us .

Look in the last few weeks, we've reversed course on all of these decisions. We are taking manager mode. We're now firmly and founder mode. We are re founding this company. This is open door to point out and we believe different things. So what do we believe an open door today.

Speaker #2: That doesn't make sense . We have the internet . We're going to fix this . And over time we'll add everything a homeowner needs when they need it .

Speaker #4: Tokenization allows us to increase the speed of transactions , decrease the cost of transaction , and broaden the base of home ownership . That's our job today .

Speaker #2: All bundled into one simple experience . Open doors goal is really simple . We're going to tilt the world in favor of homeowners and those working hard to become homeowners .

We believe that we have to use all of our energy and every modern tool at our disposal to build products that make homeownership easier and less friction full.

Speaker #4: We talked about how we can now accept Usdc . This week I bought Bitcoin on my own laptop so we can start developing .

Speaker #4: And we've begun talking with partners about how we can work across stablecoins and tokenization . The work is active . We're very serious about it .

Speaker #2: That's our goal , and we're going to pursue it with an incredible amount of aggression . Since my first day as a CEO of our company and our first day in this new open door , we've launched over a dozen new products and features .

We believe we're a software company and our leverage comes from Engineers, writing code we.

We believe machines are better pricing assets in humans, we believe AI will empower us to avoid toilful work and we can have a leaner and more aggressive company.

Speaker #4: And we'll tell you more when we launch something great .

Speaker #2: Our next question comes to us also via video submission from Eric Jackson .

Speaker #2: They include things like an end to end AI , home scoping , where machines instead of human beings decide what repairs are needed and what renovations need to be done .

Speaker #5: Hi , Kaz . Eric Jackson , welcome on behalf of the entire Open Army . We are thrilled to have you here leading the charge .

We believe we are here to make hard decisions and we will never ever advocate that responsibility to management consultants.

Speaker #2: We've automated title and escrow where AI has started doing some of the work that goes into closing a transaction . We've launched Open Doors , Trade in widget , where we help builders to offer a home trading program like they do in car dealerships .

Speaker #5: I have two questions . Can you say specifically what the headcount is now at the company ? I believe it was thousand 407 over the summer .

We believe in being operationally excellent, especially in marketing and corporate functions.

When I wasn't shopify, I insisted and we manage our marketing dollars like a hedge fund would manage its IRR.

Speaker #5: And second , can you say more about the revenue opportunities that you see around Ibuying ? Do you expect to add mortgages and title and other ancillary services ?

Speaker #2: The new Opendoor Key app allows agents . Opendoor experts , and soon any homeowner to assess their homes , just like an expert .

We're going to do the same thing here, we're going to spend money only on channels that give us great payback and we're going to stop spray and pray marketing.

Speaker #5: Zillow experimented with doing this a few years ago by acquiring a legacy company , and that didn't really take . So what is the CAS approach to revenue , and how do you expect to to grow this in the coming quarters ?

Speaker #2: Now we're going to fully power this with AI rather than someone showing up with a pen and paper . We launched via a peace of mind , giving people certainty when they buy their home with benefits like home warranty and early move in .

We believe slowing down buying homes just to buy them at a significant spread is a bad strategy.

Look.

Speaker #5: Thank you again .

The only folks who can sell their house and the large spread or people, who knows things that you don't know they want to get into a house as fast as possible. This is the definition of adverse selection, it's not a buying opportunity it's a massive red flag.

Speaker #4: Thanks , Eric . Look , to start with , I think Opendoor has had far too complicated a structure for a company of this size to give you a sense , we've had 11 different HR software products .

Speaker #2: We launched AI powered multi-lingual agents explaining home valuation to homeowners and helping them move forward with Opendoor . And we're launching a new partnership with roam connecting sellers with Rome's Assumable mortgage platform to help them move when they want to .

Speaker #4: We're going to go down to one as of this morning , there were 1100 people working at Opendoor , and the most important thing isn't the number of people .

She was wall Street times.

Open door is going to be kind of like a market maker in the future not a prop desk, we're going to profit from slow speed and tight spreads not on bets on the direction of the economy. Our business plan is simple.

Speaker #2: We've also made significant improvements in our SEO products significantly increasing organic traffic . But closest to my heart has been our push to default to AI everywhere , and this has allowed our frontline operators to iterate without writing code .

Speaker #4: But how aggressive and efficient those people are! I believe every single Opendoor employee needs to be 2 to 3 times more aggressive and more efficient than the average employee in tech.

Speaker #4: We will have the most aggressive software company in the public market because our mission is incredibly important. And, like I said in prepared remarks, our job is to be incredibly mindful of OPEX and to reduce our fixed OPEX over time so that it becomes a smaller and smaller part of our income statement.

Buy and sell lots and lots of pumps quickly.

Rationally excellent and increase our value to each homeowner by launching services like mortgage insurance and warranty.

Speaker #2: One of our non-technical teammates built a no code tool that cut our quarterly inventory management process from ten hours to about seven minutes , and this list of launches should show you that we have this renewed aggression at Open Door .

Starting last month, we reduced our spreads while simultaneously stepping up operational rigor and tightening our selection discipline. The goal is simple.

Speaker #4: On the second question , look , I'm incredibly bullish on what I call services . When I joined Shopify , Shopify was 50 over 50 and its revenue between SaaS and services today , services are 75% of Shopify's revenue .

We're going to make stronger first offers by more good homes and get more goods sellers through our funnel.

Speaker #2: We're going to focus on building great products , but aggression by itself is not a strategy . It's better than hope , but it's not enough .

To avoid adverse selection, we're building our inspection posted from ground up structured in App video and audio.

Speaker #2: So here's our four step plan to channel that energy . First . By the end of next year , we will drive open door to break even .

Speaker #4: And while I didn't have anything to do with it , I had something to do with it and was the services guy at Shopify .

Feed it goes directly into AI to create condition profiles that are validated through a standardized inspection processes to give us great data.

Speaker #2: We think about this in terms of adjusted net income on a 12 month go forward basis . That means Opendoor will start generating cash and will never be forced to raise equity , ever again .

Speaker #4: The reason why these embedded fintech things typically don't work is because they're usually designed by some dude in a boardroom trying to figure out , how can I make more money from my users ?

The result is going to be a consistent high fidelity view of every single home.

Speaker #4: That's what it takes . Typically work , and that's just not how users interact with products . We will build excellent products . They will feel whole , and you will buy a home from Opendoor the same way you buy a car from Tesla or something from Amazon .

Speaker #2: Second , we will drive significant positive unit economics while increasing the velocity at which we transact in homes . This includes launching financial services like mortgage .

This trust, but verify approach is going to improve the speed and the quality of homes.

While giving us amazing data to adjust our process, allowing us to grow our portfolio without sacrificing pricing discipline without giving up on asset quality and without slowing down transaction velocity.

Speaker #2: Third , as we increase our unit economics , we will change the company's focus from primarily building channels to transacting directly with buyers and sellers .

Speaker #4: They will feel like a one product and they won't be a different bunch of different cross-sell motions that you have to keep feeling like you're talking to different companies .

But paying a great home isn't the end of our job right. It's also important that when open door buys a house.

Speaker #2: We're also going to focus on reducing our days in possession rather than arbitrarily increasing spread , which has had genuine significant negative consequences for us .

Speaker #4: I hope that answers your question .

Speaker #6: Great .

<unk> value and services to both buyers and sellers.

Speaker #2: Our next question comes from Zach H , who asks , when will we see a dramatic change in profitability .

That's why earlier this week, we launched open door checkout.

Speaker #2: Fourth , once we've accomplished the first three steps , we're going to focus on allowing buyers and sellers to transact on open door without having to buy or sell from open door .

Speaker #4: Next year ? The next year we're going to see a dramatic change in profitability .

It's available in select markets now and can expand to our entire inventory soon.

Speaker #1: And Zach , let me walk you through some of the details . So as we shared in the prepared remarks , we are driving the company to adjusted net income , profitability , exiting 2026 on a 12 month go forward basis .

A buyer can walk into an open door home tour, it and place an offer to buy it on open door dot com without ever talking to a human being.

Speaker #2: This is going to significantly lower our capital risk , but more importantly , it's going to give folks options they want over time .

We're shipping them buy now button for homes on the Internet.

Speaker #1: The framework to achieve that goal requires us to rescale acquisitions . We guided to rescaling , acquisitions , growing them by 35% quarter over quarter for Q4 2025 .

Speaker #2: As we succeed , these initiatives open Door will change the home ownership experience in the same way Amazon changed the shopping experience both directly and through its third party marketplace .

We're going to improve on this we're going to add more products and more features for homeowners to simplify the home buying experience starting with mortgages and warranties.

Speaker #1: And we are driving to exit Q4 2026 by buying somewhere around 6000 homes . You can track that our progress against that goal and hold us accountable to that goal at Accountable , which will be updated weekly on the margin side , we expect to get contribution margin of 5 to 7% as we approach the acquisitions with renewed rigor , decreasing tail homes , improving days and possession , and therefore holding costs .

Look in the future buying a home will be a seamless buying a car from Tesla.

Speaker #2: Let me be clear . Adjusted net income breakeven is a milestone , not a goalpost . We have a huge runway ahead of us .

You'll choose your home your financing your warranty your insurance all in one place all in one slow.

Speaker #2: Yes , there's going to be some headwinds . We're going to get some things wrong , but we're committed to consistently delivering improved unit economics .

Right now.

<unk> had to deal with a bunch of different companies brokers agents.

Speaker #2: And you're going to begin seeing progress towards adjusted net income breakeven milestones . As we clear old inventory and increase our acquisition speed .

It's tough to get what they need for a house.

That doesn't make sense.

Speaker #1: In addition , as we get more shots on goal and buy more homes , we get the opportunity to attach more products and drive margin from ancillary services .

Speaker #2: In my first month , we've already made significant progress on the first three steps as we move towards breakeven adjusted net income . We're prioritizing durable cost reductions .

The Internet, we're going to fix this and over time.

Everything a homeowner needs when they need it all bundled into one simple experience.

Speaker #1: We expect financing costs of 2 to 3% of revenue . These costs are highly sensitive to our turns and will benefit from our faster resale velocity .

Open doors goal is really simple.

Speaker #2: Christie is going to talk about some of these , but I want to give you some examples . We reduced spend on external software and have terminated or unprocessed to terminate over 20 software vendors to date .

And it helped the world in favor of homeowners and go is working hard to become homeowners.

Speaker #1: We're targeting adjusted OpEx of 3 to 4% of revenue . We expect to leverage our existing fixed opex structure as cash mentioned , to invest slightly more in marketing .

Our goal.

And we're going to pursue it with an incredible amount of aggression.

Speaker #2: We've reduced spend on external consultants , open doors spent millions on management and PR consultants in the first half of 2025 , the go forward plan is zero .

Since my first day as CEO of our company.

And our first day in this new open door.

Speaker #1: But with the discipline that CAS discussed earlier, and we expect to scale operations marginally as we rescale volumes, that's a framework. It's not new guidance, but it's.

We've launched over a dozen new products and features.

It includes things like an end to end AI hung scoping, where machines is to have human beings decide what repairs are needed and more innovation is needed to be done.

Speaker #2: And to drive positive in economics and increase the velocity at which we transact at home . We've significantly changed our buying behavior . For example , up until mid-October , when someone came to Opendoor and typed in their address to sell us their house , we would have up to 11 open door employees in a hot path of that sales contract closing .

Speaker #4: Add a little to this , if you don't mind . Look , I spent the last few years of my career at Shopify , and I think folks would say that I had something to obviously not everything to do with Shopify's profitability and growth .

We've automated title and escrow, where AI has started doing some of the work that goes into closing a transaction. We've launched open doors trading widget, where we help builders to offer a whole training program like day doing car dealerships.

Speaker #4: In late 2022 , when I became Shopify's chief operating officer , I'm going to read this because it was a quote . There was an analyst that said Shopify .

The new open door key App allows agents opened our experts and soon any homeowner to assess their homes just like an expert.

Speaker #2: Today , that number in many of our flows is down to one person . And that one person is there to audit the machine to make sure we don't make unnecessary mistakes in underwriting .

Speaker #4: Quote , Shopify will lose money every year through 2025 . Profitability is nowhere to be seen . Well , Shopify became profitable two quarters after I became CEO , and it has been profitable ever since .

Now looking at fully powered is.

Speaker #2: In fact , we're now doing almost 750 home assessments per week using AI . It used to take us close to a day from a time we collected artifacts , to a time we complete assessments in our new flows .

Rather than someone showing up with a pen and paper, we launched bio peace of mind, giving people certainty when they buy their home with benefits like home warranty and early moving we launched AI powered multilingual agents, explaining home valuation to homeowners and helping them move forward with open door.

Speaker #4: And it's hit the rule of 40 every quarter . Companies don't become profitable in Excel sheets . The way this works pragmatically is what you , and I did at at Shopify .

Speaker #2: This takes about ten minutes . In the last week of September , we entered into contracts to buy 128 homes . In the last week of October , we entered into contracts to buy 230 homes to accelerate transaction speeds and customer choice .

And we are launching a new partnership with Rome, connecting sellers with wrongs assumable mortgage platform to help them move when they want to we've also made significant improvements in our SCO products significantly increasing organic traffic.

Speaker #4: You create a list of projects . You put odds adjusted , odds of success against each of them , and you execute every single day .

Speaker #4: At Shopify , had a few dozen of these . 3 or 4 of them ended up really mattering , and we have the same list here .

Speaker #2: We can now accept a Usdc as a payment method for home purchases and to make the company primarily DTC . We've turned on open doors , DTC flow .

Speaker #4: We have a list of projects . And the reason I say we're going to drive to profitability is because this is not a passive thing .

But closest to my heart and it's been our push to default to AI everywhere.

Speaker #2: Once again . The company had completely shut down almost all of these flows . Look , while we want customers who want experts to be able to work with one , we are once again accepting customers who want to sell our home directly .

And this has allowed our frontline operators.

Speaker #4: It's not just going to happen to us . We know what we are going to do . We're going to take those actions and we're going to exit 2026 .

And rate without writing code one of our non technical teammates built no code tool that cut our quarterly inventory management process from 10 hours to about seven minutes.

Speaker #4: And I profitable on a go forward basis . we cut you off .

Speaker #1: That's great . Great .

Speaker #2: Last week , these customers made up over 20% of our total home assessed . And in a test , we ran mid-October on over 2000 accounts created .

Speaker #2: Our next question comes to us from Victoria B short sellers keep attacking . Open door spreading negativity and driving the stock down . Despite strong progress .

And this list of launches should show you that we have just renewed aggression and open door, we're going to focus on building great products, but aggression by itself is not a strategy.

Speaker #2: We saw that our new DTC , totally unoptimized funnel , was able to convert six times better than the Non-d2 funnel . We're far , far from optimizing this , but we believe we have significant opportunity to improve our overall conversion .

Speaker #2: What's your strategy as CEO to fight these daily short selling pressures ? Protect shareholders and make sure the market sees open doors . True strength .

<unk> been at and hope.

Not enough.

Speaker #4: Look, I care a great deal about our average shareholder, and you've seen us do something today to help align us to our average shareholder.

So here's our four step plan to channel that energy.

By the end of next year, we will drive open door to breakeven we think about this in terms of adjusted net income on a 12 months go forward basis that means open door will start generating cash and will never forced to raise equity ever again.

Speaker #2: Okay , that's a lot . Before I hand off to Christie , I want to spend a minute to talk to you about previous decisions .

Speaker #4: Having said that , I don't spend that much of my time thinking about short sellers . I didn't I never worked on Wall Street , and I genuinely don't understand why these people do what they do .

Speaker #2: Opendoor made about its capital structure . Because , look , I think it's important that you hear from me directly about this . When I took this job , I knew Opendoor needed a balance sheet that would fit for our ambitions .

Speaker #4: It just seems deeply boring and like , just bad for the soul . I mostly just pity them . They don't really build anything .

Second we will drive significant positive unit economics.

While increasing the velocity in which we transact in the homes. This includes launching financial services like mortgage.

Speaker #4: Look , we run the company for a long term owners , not for people that bet against us every week . And what matters to us is execution week in , week out , how fast we buy and sell homes , how operationally excellent we are , how we turn over inventory .

Speaker #2: Every home needs a solid foundation , and for us , that's capital . There are aspects of our balance sheet that are just genuinely phenomenal .

Third as we increase our unit economics, we will change the company's focus from primarily building channels to transacting directly with buyers and sellers.

Speaker #2: We have ten different lending facilities with long standing partners . Some of them as long as nine years , who've demonstrated their ability to scale with us as we grow .

We're also going to focus on reducing our days in possession, rather than arbitrarily increasing spread which has had a genuine significant negative consequences for us fourth once it accomplished our first three steps, we're going to focus on allowing buyers and sellers to transact on open door without having to.

Speaker #4: And I think the best way to deal with short sellers is just to prove them wrong through numbers. Every quarter, we're going to improve unit economics.

Speaker #2: Today , we can finance roughly 5000 homes all at once , and close at almost 100% advance rate at great prices . At our peak , that number was about 20,000 , and we're going to get back there .

Speaker #4: Every quarter we're going to get better every week we're going to show you the numbers . We're going to do all the right things .

Speaker #4: And I think when you do that, the score takes care of itself.

Speaker #2: And I'm genuinely confident that we can get there with our lending partners . But there are also part of our capital structure that were not focused in the long term .

Buy or sell problem open door.

Speaker #6: Great .

Going to significantly lower our capital risk, but more importantly, it's going to give folks options they want.

Speaker #2: Our next question comes from daily , from JP Morgan . How do you define opens identity ? What do you see as its biggest strength and how will you leverage that to achieve sustainable growth and profitability ?

Overtime as we succeed in these initiatives.

Speaker #2: They seem to have been designed and driven by fear rather than setting us up to win . To be blunt , when I joined the balance sheet had a ten clock .

Open durable change to home ownership experience in the same way Amazon changed the shopping experience both directly and through its third party marketplace.

Speaker #2: As open navigates the currently depressed housing market and longer term .

Speaker #4: It's a great question . I'll take it first , if you don't mind . Look , Open Door is a software company . We're not a hedge fund waiting for macro to turn around .

Speaker #2: The company had issued convertible notes with an early repayment that could have forced us to repay them in full before the end of this year .

Let me be clear.

Adjusted net income breakeven is a milestone not a goalpost.

Speaker #4: That's not our job. Our job is to help people sell, buy, and own homes, and our leverage comes from building excellent products.

Speaker #2: That would have been disastrous for the company . And my first priority was to remove this pressure and give us runway to execute on our vision .

Have a huge runway ahead of us.

Yes, there's going to be some headwinds, we're going to get some things wrong, but we're committed to consistently delivering improved unit economics are going to begin seeing progress towards adjusted net income breakeven milestones as we clear old inventory and increase our acquisition speed.

Speaker #2: Let me be clear . I despise dilution . If we issue a share , it has only one job to make . Every other share worth more for our existing shareholders .

Speaker #4: And you do by writing excellent code . So that's the largest source of our leverage , right ? Code written by our engineers , data on our databases and the models we have .

In my first month, we've already made significant progress on the first three steps.

Speaker #2: But to give us some breathing room . I made a decision in my first week to use our existing ATM program to raise nearly $200 million .

Speaker #4: And we're improving that value , not just the valuation of home , but dispersion on them . And days in possession . And I firmly believe the best software companies are built in hard times because they force the times , force you to be disciplined , right ?

As we move towards breakeven adjusted net income.

We're prioritizing durable cost reductions, Chris who's going to talk about some of these but I want to give you. Some examples.

Speaker #2: This bought us the time we needed to deal with the notes without a gun to our head . Earlier today , we reached an agreement to retire the majority of these notes .

We reduced spend on external software and have terminated.

Speaker #4: You end up having to care about your user more . You end up building deeper integrations that solve more of the problem . So when times get good , you end up having abnormally large profits .

Our in process to terminate over 20 software vendors to date.

Speaker #2: We took the steps we needed to clean up our capital structure , and we now have the balance sheet we need to stop playing defense and start playing offense .

We've reduced span external consultants open doors.

Millions on management and pure consultants in the first half of 2025, the Gulfport plan is zero.

Speaker #2: But there's a second part to this , and it's about you . We wouldn't be here without you . Our . You believed in the long term value of this business .

Speaker #4: I'm very bullish on the company . Just in the last couple of weeks , we've shown that we can grow acquisitions relatively quickly .

And to drive positive unit economics, and increase the velocity, which would transact at home.

We've significantly changed our buying behavior for.

Speaker #4: I think we grew 60% on acquisitions just this past week . We'll see how much we grow next week . And we've shown that we have relatively good leverage in this company .

Speaker #2: Even when our capital structure didn't really reflect it . And I don't believe in asking you to stay on this journey without sharing directly and upside .

For example.

Up until mid October when someone came to opened on dot com and patting her address to sell us their house.

You would have up to 11 opened or employees and a hot path of that sales contract closing.

Speaker #2: Recruiting together . Look , public markets have a long history of taking shareholders for granted . We're not going to do that . In fact , we're going to reverse that .

Speaker #4: And when you decide that you're going to do that , you have the good leverage . You have great software , you have the balance sheet that we do .

Hey, Matt.

Speaker #4: You get the chance to go on offense . And I'm I really like our odds . And I think things are starting to work for us .

Number and many of our flows is down to one person.

And that one person is there to audit the machine to make sure we don't make mistakes and underwriting.

Speaker #2: This is why we're issuing a dividend warrant . Each of you will receive three series of warrants . Series K , series A and series Z , with exercise prices at nine , 13 and shareholders 17 .

Speaker #6: Great .

Speaker #2: Our next question comes to us from Ryan Tomasello from KBW . Does management intend to continue to emphasize the cash offer as Opendoor's primary product , or do you envision moving the business more capital light ?

In fact, we're now doing almost 750 home assessments per week using AI.

It used to take us close today from a time to collect an artifact to timely complete assessments.

Speaker #2: One warrant for each series of 30 shares . You hold . These ones are going to cost you nothing . And their value goes up as we make open door into what it can be .

Speaker #2: Well, will the key agent program be the primary distribution channel for the cash offer? And if so, how should we think about potential bottlenecks on growth, given this high-touch approach tied to agents?

And our new flows this takes about 10 minutes.

In the last week of September we entered into contracts to buy 128 homes and elastic of October we entered into contracts to buy 230 homes.

Speaker #2: We want to be on the same side of the table as our shareholder . We're returning some value to you today . You can sell the warrants as soon as you get them , but I'm hoping that you'll stay along for this ride , that you'll participate in what we are building together .

Speaker #4: That's just not how I think of the business , to be honest . Let me answer . Let me ask you a question first .

To accelerate transaction speed and customer choice. We can now accept a U S. D C. As a payment method for home purchases.

Speaker #4: Look , I think companies fail when they think of themselves first and their users second . Like our job is to serve our users .

And to make the company primarily need to see.

Speaker #2: We're going to move forward together . And when open Doors succeeds , our shareholders are going to share in that success . And yes , I'll admit it , it gives me just a bit of joy that this will totally ruin the night of a few short sellers .

Speaker #4: And people come to us to sell or buy a home . That's what they come to us . And our job is to meet them where they are .

We've turned on open doors did you see flow once again.

The company had.

We shut down almost all of these flows.

Speaker #4: Some of them want to use an expert . Some of them don't , and the question is , how do we answer ? I think cash is a great product .

Look while we won customers who want experts to be able to work with one we are once again accepting customers who want to softer home directly.

Speaker #2: Look , we're building a new company right in the open . Open door 2.0 is committed to its community because we're building and because who we're building for matters .

Speaker #4: I think Cash Plus is a great product . We're going to have different products along both the risk and the ownership axes , because I think that's just not the final two products .

Last week these customers made up over 20% of our total home assessed.

Speaker #4: We're going to have . And I like our DTC model . I think we talked about how in our tests early on , it had been converting six x better .

And in a test few randomly October on over 2000 accounts created we started our new teachers see totally unoptimized funnel was able to convert six times better than the non DTC funnel.

Speaker #2: We're going to talk to you the way we talk in the office in plain English , sometimes with a few cuss words , but always with transparency .

Speaker #4: So I think the question isn't really one of which channel are you going to pick . We're going to pick the channels that allow us to have the maximum impact on behalf of our users .

Speaker #2: Please consider this our clean break from corporate jargon . We're just going to talk to you and tell you when we make mistakes .

We're far far from optimizing this but we believe we have significant opportunity to improve our overall conversion.

Speaker #2: And we know that this transparency is not a burden . It's a feature of your trust in us . We want to hear from our shareholders , your ideas , your questions , and even product bugs because we want to fix things fast and build better .

Speaker #4: And I firmly believe in our DTC channels are going to be the future of the company . And if our users that want to use experts , we want to serve them where they are .

Okay.

Thanks, a lot.

Before I hand off to Christy I want to spend a minute to talk to you about previous decisions opened or made about its capital structure.

Speaker #6: Great .

Speaker #2: If you haven't already seen this , my DMs are open on X.com . I am more bullish today about open doors ability to .

Speaker #2: We have a few questions on sustainable acquisition growth . So I'll read a few of those out . One from Yigal at Citi .

Because look I think it's important that you hear from me directly about this.

Speaker #2: How are you expecting to manage guardrails on acquisitions as you pick up pace ? Another from Andrew at Citizens . Can you talk about controlling the long tail and how those certain purchases have outsized losses ?

When I took this job I knew open door and you need a balance sheet that was fit for ambitions.

Speaker #2: Change home ownership than I was when I took this job . I'm more bullish because I see a lot more of what is happening inside the company than folks see from the outside .

Every home needs, a solid foundation and for US that's capital.

Speaker #2: And Nick Macandrew , at Zelman , how do you balance near-term transaction growth with your stated goal of evolving into a platform business ?

Speaker #2: And I think one of the ways in which we can bring you all along for this journey is to just communicate more frequently , more directly , and tell you what we are doing , what's working , what's not .

There are aspects of our balance sheet or just genuinely phenomenon, we have 10 different lending facilities with long standing partners some of them as long as nine years.

Speaker #4: Okay , I'll try to take it one at a time . I think the tail question is actually the question . Let me take that one first .

<unk> demonstrated the ability to scale with us as we grow.

Speaker #2: Christie's going to tell you a bit more about how we intend to do this . After she shares our third quarter results . Christie .

Speaker #4: So what you actually want to have is a lot of dispersion in your dispersion in your model . Right ? Opendoor has traditionally not had that where it has kind of like had a peanut butter spread across its base .

Today, we can finance roughly 5000 homes, all at once and clothes and almost 100% advance rate and great prices.

Speaker #3: Thank you . CAS . Our third quarter results reflect the deliberate choices made earlier in the year to prioritize risk management over volume growth defined by wide spreads and a risk averse posture that treated buying homes as something to avoid rather than our core business .

At our peak that number was about 20000, and we're going to get back there and I'm genuinely confident that we can get there with our lending partners.

Speaker #4: We now have significant dispersion . And this is basically all we talk about is how we can have excellent offer on good homes where we know basic possession is going to be low and be more careful on longer , longer days in possession homes .

But.

It's also part of our capital structure that we're not focused on the long term.

Speaker #3: The numbers tell the story . In the third quarter , we purchased 1169 homes , roughly in line with the expectation shared at Q2 earnings , but well below our recent historical acquisition volumes .

They seem to have been designed and driven by fear rather than setting us up to win.

Speaker #4: And we have a new process for inspecting every home to make sure that we don't get caught by surprise . This is the trust , but verify approach .

Speaker #3: We delivered revenue of $915 million above the high end of our guidance , as we deliberately cleared old inventory before the slower winter selling season .

To be blunt when I joined the balance sheet had a 10 o'clock.

The company had issued convertible notes with an early repayment that have forced us to repay them in full before the end of this year.

Speaker #4: I talked about , which will be great because it will both a variable cost and be more importantly , allows us to have lots of data on our servers .

Speaker #3: When you stop buying homes , you don't just lose volume , you lose the ability to manage your inventory mix . We were left selling through older homes that were selected under the old strategy , and that showed up in our margins .

That would have been disastrous for the company and my first priority was to remove this pressure and give us runway to execute on our vision.

Speaker #4: Last question . Second , I don't think these two things are at conflict . Look at Shopify . We had high growth and high free cash flow .

Speaker #3: GAAP gross profit 66 million in Q3 , compared to 105 million in Q3 of the prior year . GAAP gross margin was 7.2% , down 40 basis points year over year .

Speaker #3: GAAP gross profit was compared to contribution profit of 52 million and contribution margin of 3.8% . In Q3 2020 . For on costs .

Let me be clear.

I despise dilution.

If the issue of share it has only one job to make every other share worth more for our existing shareholders.

Speaker #4: I think these two things actually go together because when you buy lots of homes , you get opportunities to sell lots of homes .

But can you give us some breathing room I made decision in my first week to use our existing ATM program to raise nearly $200 million.

Speaker #4: And when you sell lots of homes , you get opportunity to attach additional services to them . And I think these two things go hand in hand .

Speaker #3: Prior leadership did meaningful work to restructure our cost base , and we will continue that effort . Third quarter GAAP operating expenses

This brought us the time, we needed to deal with the notes without a gun to our head.

Speaker #4: And time to the first question , last . Look , I think we have shown that we have really good levers at our disposal .

Earlier today.

We reached an agreement to retire the majority of these notes.

Speaker #4: Morgan and the growth team have been working only for a couple of weeks now , but every single day we're seeing improvement on buying the types of home we want to buy .

We took the steps we needed to clean up our capital structure and we now have the balance sheet, we need to stop playing defense and start playing offense, but.

Speaker #4: And we really like our top of funnel . We have cut marketing and have seen acquisition go up , which is always a good sign .

There's a second part to this.

And it's about you.

Speaker #4: Am I missing something ?

We wouldn't be here without you our shareholders you believed in the long term value of this business, even when our capital structure Didnt really reflect it.

Speaker #6: That was great .

Speaker #2: We have another question from Ben Black with DB . It was a few in there , but his last question was in what ways can AI be an accelerant to growth ?

And I don't believe in asking you to stay on this journey without sharing directly into upside recruiting together.

Speaker #4: In all the ways and basically all the ways . Look , I don't spend that much of my time worrying about like the problems open Door has traditionally had on this area because they've been different types of problems .

Look public markets have a long history of taking shareholders for granted.

We're not going to do that and in fact, we're going to reverse that.

This is why.

Issuing a dividend warrant each of you will receive three series a warrants series K series, a and series Z.

Speaker #4: I've spent a lot of time about what the problems are today . Let me give you one example . I talked about this a bit .

Speaker #4: We would have up to 11 people touch a home before we had a sales contract go out for it today in many of our flows , that's down to one .

With exercise prices at 913, and 17, one warrant for each series of 30 shares you hold.

These ones are going to cost you nothing and their value goes up as we make open door into what it can be.

Speaker #4: And the job of that one person is to watch the machine , right . This significantly reduces opex per home . That we acquire far , far , far fewer human beings , far more machines .

We want to be on the same side table at our shareholder.

We are returning some value to you today you can sell the warrants as soon as you get done.

Speaker #4: This is better speed , better user experience , lower opex . When , when , when . And then secondly , on the just the top of funnel part , you've seen us cut marketing and we cut marketing .

But I'm, hoping that you'll stay along for this ride youll participate and what we are building together.

We're going to move forward together and when it opened or succeeds our shareholders are going to share in that success.

Speaker #4: When I came in and increased acquisition , we're able to do this because we can optimize our funnels and put more of the experience into hand of the user .

And yes, I'll admit it.

It gives me just a bit of joy that bespoke totally ruined the night of a few short sellers.

Speaker #4: And by the way , AI is also able to help us explain to our users the valuation of each home . So across top of funnel , middle funnel , bottom of funnel , already we are seeing the impact of AI , and we're also seeing the impact on closing , which is at the last step where we've had machines do much of the work for closing these days .

<unk>.

We're building a new company right and you open.

Opened or to point out is committed to its community because we're building and because who were building four matters.

Talk to you the way we talk in the office in plain English.

Sometimes with a few cuss words.

But always with transparency.

Speaker #4: And that's just going to continue .

Please consider this a clean break from Corpo jargon, we're just going to talk to you.

Speaker #6: Great .

Speaker #2: We had one more question from Margarita m , who asks , how can you guys make home ownership easier for younger generations ?

<unk> tell you wouldn't make mistakes.

And we noted this transparency is not a burden it's a feature of your trust in us.

Speaker #4: I mean, this is like the fundamental goal of the company. Look, home prices have increased by something like 50% since 2020.

We want to hear from our shareholders.

Is there questions and even product bugs.

Because we want to fix things faster and build better.

Speaker #4: Mortgage rates are much higher than they used to be. Housing inventory is far too low. Typical sales are taking over 60 days, and about 1 in 7 deals are falling through. The average time for a person to buy a home is almost 40 days.

If you haven't already seen this my dams are opened on X dot com.

I am more bullish today about open doors ability to change homeownership than I was when I took this job I'm more bullish because I see a lot more of what is happening inside the company and folks from the outside.

And I think one of the ways in which we can bring you all along for this journey.

Speaker #4: Now, this is just terrible because it's harming our communities, harming our families, and people who want to own are facing real barriers.

Is to just communicate more frequently more directly and tell you what we're doing.

Whats working whats not.

Speaker #4: People feel trapped in their homes because their mortgage rates . This is why we announced our partnership with roam today . But the enemy really isn't any one group of people or any one company .

Chris I'm going to tell you a bit more about how we do this after she shares our third quarter results Christie. Thank you Kathy.

Our third quarter results reflect the deliberate choices made earlier in the year to prioritize risk management over volume growth defined by widespread and a risk averse posture that train and buying homes at something to avoid rather than our core business. The numbers tell the story in the third quarter, we purchased 1169 homes roughly in line with the expectation.

Speaker #4: That's just not how it works. The enemy is the process. There are so many people involved in the process of you buying and selling a home that the costs are just out of hand. One of the things I'm super excited about is the fact that we can underwrite a home, which gives us excellent power to underwrite mortgages. The fact that we can do things that allow you to buy a home earlier is really promising.

<unk> shared our Q2 earnings are well below our recent historical acquisition volumes, we delivered revenue of 915 million above the high end of our guidance as we deliberately cleared all the inventory before the slower winter selling season.

Speaker #4: By Better home earlier , and know that you have the peace of mind to buy it . Is it going to be a key part of the company's future ?

When you stop buying homes, you don't just lose volume you lose the ability to manage your inventory next we were left selling thrill older homes that were selected under the old strategy and that showed up in our margins.

Speaker #4: But that's the mission , right ? Tilt the world towards homeowners and people who are working hard to become homeowners .

GAAP gross profit was $66 million in Q3 compared to $105 million in Q3 of the prior year GAAP gross margin was seven 2% down 40 basis points year over year contribution profit was $20 million and contribution margin was two 2% compared to contribution profit of $52 million and contribution margin of three <unk>.

Speaker #6: Great .

Speaker #2: We're getting close to the top of the hour , so that was our last question . So , Kaz , if you have any closing remarks .

Speaker #4: Yeah , let me thanks . I appreciate it . Thanks for your question , folks . Look , I spent most of my day in cursor and GitHub .

Speaker #4: I don't spend much of my time in spreadsheets . I started writing code on my Commodore 64 when I was six , and I'm opinionated about what open doors product should look like .

8% in Q3, 'twenty 'twenty four.

On costs prior leadership, the meaningful work to restructure our cost base and we will continue that effort third quarter GAAP operating expenses totaled 134 million adjusted operating expenses were 53 million or 41% improvement from $90 million in the third quarter of 2024.

Speaker #4: We are a product company building software to enable home ownership , and you've seen us launch many products like dozens of products just in the past few weeks , and you should expect us to do the same .

Improvement was driven by disciplined cost management across all components marketing operations and fixed operating expense.

Speaker #4: And you should expect us to be operationally excellent and incredibly mindful of your dollars . As our shareholders . You're going to see us be accountable .

As he rescale acquisitions, we're doing that from this structurally lower cost base.

Net loss for the third quarter was 90 million compared to a loss of $78 million in Q3 24. The prior year number included a $14 million gain from the mainstay deconsolidation adjusted.

Speaker #4: We're going to make mistakes along the way . But at every single step you're going to see us care deeply about our mission and be transparent as we build .

Adjusted net loss totaled 61 million an improvement from an adjusted net loss of $70 million in the prior year period.

Speaker #4: I'm incredibly bullish . I am more bullish today than I was when I took this job . And I think we're going to actually make a change and make a real difference in the future of home ownership in this country .

These are the results of the old open door what matters now is what comes next.

Earlier, you heard the plan for open door to your point out I'd like to take a moment to walk through the foundation that runs on our capital.

Speaker #6: Great .

Ended the quarter with 962 million in unrestricted cash and $187 million of equity invested in homes. We held 3139 homes, representing 1.1 billion in net inventory, we had $7 6 billion and nonrecourse asset backed borrowing capacity of which total committed borrowing capacity was one point.

8 billion.

As Kathy mentioned, we have executed three substantial capital transactions to set our balance sheet up for the scale ahead first the rapid increase in our stock price triggered a condition in our 2030 convertible notes that could've required us to repay the full principal balance in cash during the fourth quarter of 2025, using our at the market.

Our ATM equity program, we proactively raised equity in September 2025, selling 21 6 million shares at a weighted average price per share of 926 for nearly 200 million of gross proceeds.

Today, we refinanced a substantial portion of the 2030 notes with equity as a reminder, these notes bear interest at a 7% annual rate. The combination of these two transactions add meaningful liquidity to our balance sheet reduce our cash interest costs and provide enhanced financial flexibility third to align opened doors upsides.

All shareholders, our board declared a pro rata warrant dividend every shareholder will receive three series of freely tradable warrants for every 30 common shares held as of the November 18th record date with exercise prices of $9 $13 and $17.

So you mean out we believe we have the right capital set up for the open door to Plano operating model higher volumes faster turns tighter spreads and more products to serve homeowners now let me tell you how we're executing against that model and how you can hold us accountable.

We are targeting to reach adjusted net income profitability by the end of 2026 measured on a forward 12 month basis.

To get there we're focused on three key management objectives that we monitor internally for each objective I want to frame for you why this matters, what we're doing and how you can hold us accountable first scale high quality acquisitions more volume means more revenue from transactions and ancillary services plus better leverage of our cost base.

Further market concentration creates a flywheel when we own meaningful share in a market, we attract more inventory, which attracts more buyers which attracts more sellers.

We have multiple initiatives underway to drive this growth. Most importantly, as cats described earlier, we started reducing our average spread while increasing our operational rigor and selection stronger offers for high velocity high quality homes discipline on higher risk columns, we're pairing that with AI, driven scoping and standardized pre offer inspections to.

Raise conversion and cut time and costs from offer to acquisition you can track our progress against our acquisition goals through the end of 2026 on a new dashboard at accountable that opened our dotcom individual weeks will fluctuate holidays weather local market events will be focused on the trajectory over time.

Michael Judd: Hey, everyone. I'd like to welcome you all to Opendoor's inaugural Open House earnings livestream. I'm Michael Judd, Opendoor's Head of Investor Relations. A few housekeeping items before we get started. Details of our results and additional management commentary are available in our earnings release, which can be found at investor.opendoor.com. The following discussion contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact or statements that could be deemed forward-looking, including, but not limited to, statements regarding Opendoor's financial condition, anticipated financial performance, business strategy and plans, market opportunity and expansion, and management objectives for future operations. These statements are neither promises nor guarantees, and undue reliance should not be placed on them. Such forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those discussed here.

Second improve unit economics and resale velocity.

<unk> and profitability per transaction enable us to build a sustainable business, while enduring macroeconomic changes.

Higher profitability per transaction gives us the ability to decrease the spreads embedded in our offers leading to more acquisition.

This objective is supported by our tailored spread framework by pre.

I see more aggressively for high quality faster selling homes and maintaining discipline on higher risk assets. We expect our acquisition next to skew toward more marketable homes that need less repair and renovation.

Michael Judd: Additional information that could cause actual results to differ from forward-looking statements can be found in the risk factors section of Opendoor's most recent annual report on Form 10-K for the year ended 31 December 2024, as updated by our quarterly report on Form 10-Q for the quarters ended 30 June 2025 and 30 September 2025, and other filings to the SEC. Any forward-looking statements made on this webcast, including responses to your questions, are based on management's reasonable current expectations and assumptions as of today, and Opendoor assumes no obligation to update or revise them, whether as a result of new information, future events, or otherwise, except as required by law. The following discussion contains references to certain non-GAAP financial measures. The company believes these non-GAAP financial measures are useful to investors as supplemental operational measurements to evaluate the company's financial performance.

We expect this to shorten the time from acquisition to listing and days on market, thereby reducing our holding costs.

Second we are innovating at an incredible pace with a renewed focus on execution and our culture of challenging everything to be better much of our product innovation is designed to automate workflows and increase resale velocity supporting our business model focused on turns not spread you can hold us accountable to improving resale velocity.

Tracking the percentage of open door homes on the market for greater than 120 days, which we report quarterly in our 10-Q you can also follow our product feature and partnership launches an accountable thought opened our dot com to see how we're building with velocity and to the business.

Michael Judd: For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP metric, please see our website at investor.opendoor.com. With that, let's get into the Open House with Kaz and Christy.

Third build operating leverage we will scale transactions faster than fixed costs. So each additional home ads accretive profit, we're cutting aggressively in the right places eliminating consultants, removing redundant tools and software, reducing marketing waste and streamlining operations, while simultaneously reinvesting a portion of those savings.

Kaz Nejatian: Good afternoon. My name is Kaz Nejatian. I'm a computer nerd turned lawyer, turned founder, but I think of myself primarily as a product manager. That's what I've spent most of my career doing: building products and leading teams to build better products, faster. I'm not the guy you invite to your place if you want someone to bring to party. I'm the guy you invite to your party if you want someone to fix your Sonos. On my first day at work, I told our team at Opendoor that we're going to make a bunch of changes and that the new Opendoor would look nothing like the old one. That's because, well, the old Opendoor had kind of lost its way.

And the engineering and AI automation and importantly, we expect to shift our overall operating expense profile toward variable components that flex with volumes rather than remains fixed through cycles.

Can hold us accountable by tracking to specific metrics. We report quarterly in our 10-Q fixed operating expenses should hold relatively steady as we rescale volumes and trailing 12 month operations expense as a percentage of 12 trailing 12 month revenue should hold relatively steady or decrease over time.

Kaz Nejatian: Before I tell you why I think Opendoor was broken, let me share you one example of the thing that has changed just in the last few weeks, so you can get a sense of the scale of the change. Look, on my first day at work on 15 September, Opendoor had entered into contracts to buy 120 homes in the prior seven days. By last week of October, that number had risen to 230 homes. In seven weeks, we nearly doubled our speed of acquisition. I think it's reasonable to ask, how can we move so fast right now, when we used to move so goddamn slowly? If you give me a couple of minutes, I'd like to tell you what caused the old Opendoor to be so broken. I think this diagnosis will kind of matter in how we rebuild Opendoor.

These three objectives are the foundation of our path to profitability and we're building in the open. So you can track our progress along the way.

Turning to our outlook our guidance is going to look different than what you've seen in previous quarters. Our business is changing rapidly just in the past few weeks our acquisition contract speed increased by nearly two X. We're focused on execution and outcomes not on benchmarking our return during the transformation of this scale.

Our results in the upcoming quarter or largely the outcome of us managing decisions that were made several months ago. We're focused now on making the right long term decisions for the business not managing the short term guidance, what matters and what we want to be held accountable for the actions we take from here and the results they drive overtime, our destination is clear adjust.

And net income profitability by the end of next year measured on a 12 month go forward basis.

Kaz Nejatian: Having been inside the company for just over a month, it's kind of obvious to me that the old Opendoor had just lost faith in the power of software to make selling, buying, and owning a home easier. It just kind of thought of itself as an asset manager trying to predict the economy. The previous Opendoor also didn't really believe in the power of AI to do anything, much less to make our work less toilsome. When I joined the team, I'm not kidding, there were a dozen people whose only job it was to copy and paste information from PDFs into glorified spreadsheets. The previous Opendoor also didn't really believe in itself.

We've already seen the levers in this business work you can't build a breakeven business in a spreadsheet you build it by shipping product operating with discipline and learning from the market.

For the near term I will provide you with these guideposts.

Acquisition re scaling we're committed to re scaling acquisition volume, we expect fourth quarter 2025 acquisitions to increase by at least 35% from Q3 as our product launches and pricing strategy changes take hold you can check our weekly acquisition progress at accountable without opened or Dot com.

Revenue, we expect Q4 revenue to be higher from the outlook. We provided at Q2 earnings but decreased approximately 35% quarter over quarter due to low inventory levels from Q3's reduced acquisition volumes.

Kaz Nejatian: I was genuinely shocked when I found out that one of Opendoor's biggest expenses in the first half of this year was millions of dollars paid to a well-known consulting firm to tell Opendoor how to do its job. Everywhere I looked in my first 30 days, I found consultants making decisions that should have been made by executives. Finally, the previous Opendoor had become so risk averse that it no longer really believed in buying and selling homes. If you ignore COVID, we bought fewer homes in Q3 than we have since 2017, when Opendoor was just a tiny startup. In the last few weeks, we've reversed course on all these decisions. We are ditching manager mode. We're now firmly in founder mode. We are refounding this company. This is Opendoor 2.0, and we believe different things. What do we believe at Opendoor today?

Contribution margin our priorities since mid September has been the clear old inventory homes selected under the previous strategy that prioritize spread over quality. That's pressured our contribution margin sequentially since April through October and we believe we bottomed out in October margins will improve through the end of the year as we replace legacy M.

Centaury with better homes by Q4 contribution margin will be below Q3, as we reverse the downward trend.

Cost discipline, we are focused on continuing to manage and improve our cost structure. Adjusted operating expenses for the 12 months ended June 32025 were $307 million for the 12 months ending June 32026, we expect to spend 255 million to $265 million.

Excluding the 15 million cash May call award for our CEO. This is a year over year decrease of approximately $62 million or 20% at the midpoint we.

We expect to achieve these savings while concurrently investing in engineering and AI automation to drive further operating leverage we're cutting the waste and reinvesting in what matters.

Kaz Nejatian: We believe that we have to use all of our energy and every modern tool at our disposal to build products that make homeownership easier and less frictionful. We believe we're a software company, and our leverage comes from engineers writing code. We believe machines are better at pricing assets than humans. We believe AI will empower us to avoid toilful work, and we can have a leaner, more aggressive company. We believe we are here to make hard decisions, and we will never, ever advocate that responsibility to management consultants. We believe in being operationally excellent, especially in marketing and corporate functions. When I was at Shopify, I insisted that we manage our marketing dollars like a hedge fund would manage its IRR. We're going to do the same thing here.

Finally, adjusted EBITDA, given the near term margin pressure as we clear all the inventory. We expect Q4 2025 adjusted EBITDA loss in the high 40 millions to mid 50 millions.

We're building opened our 2.0 and the open holding ourselves accountable to measurable objectives, and giving you the transparency to track our progress the journey won't be perfectly linear, but our conviction in the destination and and the levers that get US there is unwavering with that Michael I'll turn it over to you for questions.

Great. Thanks, Christy our first question comes to US from video submission from Vlad attentive.

What's up has by the way we're super pump that you guys are streaming live to retail on robinhood.

Kaz Nejatian: We're going to spend money only on channels that give us great payback, and we're going to stop spray-and-pray marketing. We believe slowing down buying homes just to buy them at a significant spread is a bad strategy. Look, the only folks who are going to sell their house at a large spread are people who know things that you don't know. They want to get rid of their house as fast as possible. This is the definition of adverse selection. It's not a buying opportunity. It's a massive red flag. To use Wall Street terms, Opendoor is going to be kind of like a market maker in the future, not a prop desk. We're going to profit from flow, speed, and tight spreads, not on bets on the direction of the economy. Our business plan is simple.

Question on everyone's mind is what's going on with organization, how real is it and how do you think it could revolutionize the homeownership experience.

Thanks, a lot thanks for hosting us.

Look I'm, such a big fan of Robinhood and I hope that we can continue to do things together.

Our mission at open door is to tilt the world towards homeowners and always working hard to become homeowners and I love that Robin Hood does some of the same things you know this whole thing of taking power away from fancy people and giving it to the average person.

Now to answer your question look I have a habit.

Not announcing products before they are launched that's because I'd build products not spreadsheets and I think it's important that we ship things before we talk about them.

And I don't want to say, we're going to do this next week, but I generally can't imagine a future.

Kaz Nejatian: Buy and sell lots and lots of homes quickly, be operationally excellent, and increase our value to each homeowner by launching services like mortgage, insurance, and warranty. Starting last month, we reduced our spreads while simultaneously stepping up operational rigor and tightening our selection discipline. The goal is simple. We're going to make stronger first offers, buy more good homes, and get more good sellers through our funnel. To avoid adverse selection, we're building our inspection process from ground up: structured in-app video and audio feed that goes directly into AI that creates condition profiles that are validated through a standardized inspection process that gives us great data. The result is going to be a consistent, high-fidelity view of every single home.

We're real state dot token hoist.

And I also can't imagine a future where open door isn't leading.

Innovation in our real estate look asset <unk> is not a side question for us.

Took innovation allows us to increase the speed of transactions decreased the cost of transaction and broadened base of homeownership. That's her job today, we talked about how we can now accept U S. D. C. This week I bought bitcoin on my own laptop. So they can start developing.

And we've begun talking with partners about how we can work across stable coins anticoagulation.

Work is active we're very serious about it and we'll tell you more when we launch something.

Great.

Our next question comes to US also via video submission from Eric Jackson.

Kaz Nejatian: This trust-but-verify approach is going to improve the speed and the quality of homes while giving us amazing data to adjust our process, allowing us to grow our portfolio without sacrificing pricing discipline, without giving up on asset quality, and without slowing down transaction velocity. Buying a great home isn't the end of our job, right? It's also important that when Opendoor buys a house, we provide value and services to both buyers and sellers. That's why earlier this week, we launched Opendoor Checkout. It's available in select markets now, and it's going to expand to our entire inventory soon. A buyer can walk into an Opendoor home, tour it, and place an offer to buy it on opendoor.com without ever talking to a human being. We're shipping the buy now button for homes on the internet. We're going to improve on this.

Hi, guys, Eric Jackson welcome on behalf of the entire open Army. We are thrilled to have you here, leading the charge I have two questions can you say specifically what the head count is now at the company I believe it was 407 over the summer and second can you say more about the revenue.

Opportunities that you see around <unk> do you expect to add mortgage and title and other ancillary services Zillow experimented with doing this a few years ago by acquiring a legacy company and that didn't really take so what is the has approach to revenue and how do you expect to grow this.

In the coming quarters. Thank you again.

Thank you look to start with I think open doors had far too complicated structure for a company at the sites to give you a sense. We've had 11 different HR software products, we're going to go down to one as of this morning. There were 11 100 people working at open door and the most important thing isn't the number of <unk>.

Kaz Nejatian: We're going to add more products and more features for homeowners to simplify the home buying experience, starting with mortgages and warranties. Look, in the future, buying a home will be as seamless as buying a car from Tesla. You'll choose your home, your financing, your warranty, your insurance, all in one place, all in one flow. Right now, homeowners have to deal with a bunch of different companies, brokers, agents, a lot of different stuff to get what they need for a house. That doesn't make sense. We have the internet. We're going to fix this. Over time, we'll add everything a homeowner needs when they need it, all bundled into one simple experience. Opendoor's goal is really simple. We're going to tilt the world in favor of homeowners and those working hard to become homeowners.

People, but how aggressive and efficient those people are.

I believe every single opened or employee needs to be two to three times more aggressive and more efficient.

The average employee and tech we will have the most aggressive software company in the public market because our mission is incredibly important.

And look I said in prepared remarks, our job is to be incredibly mindful of opex and to reduce our fixed opex overtime. So that it becomes a smaller and smaller part of our income statement.

And the second question look I'm relatively bullish on what I call services.

When I joined Shopify Shopify was 50 50 and its revenue between SaaS and services today services are 75% of Shopify as revenue.

Kaz Nejatian: That's our goal, and we're going to pursue it with an incredible amount of aggression. Since my first day as the CEO of our company and our first day in this new Opendoor, we've launched over a dozen new products and features. They include things like an end-to-end AI home scoping, where machines instead of human beings decide what repairs are needed and what renovations need to be done. We've automated title and escrow, where AI has started doing some of the work that goes into closing a transaction. We've launched Opendoor's trade-in widget, where we help builders to offer a home trade-in program, like they do in car dealerships. The new Opendoor Key app allows agents, Opendoor experts, and soon any homeowner to assess their homes just like an expert. Now we're going to fully power this with AI rather than someone showing up with a pen and paper.

While I didn't have everything to do with it I had something to do with it and it was the services Guy at Shopify.

The reason why these embedded fintech things typically don't worked is because they are usually designed by some dude in a boardroom trying to figure out how can I make more money from my users. That's what it takes typically work that's just not how users.

Interact with products.

We will build excellent products they will you'll hold and you will buy a home from open door. The same where you buy a car from Tesla or something from Amazon.

Feel like one product and they will be a different bunch of different cross sell motion that you have to keep fueling that youre talking to different companies I hope that answers your question.

Great.

Our next question comes from Zach H, who asked when will we see a dramatic change in profitability next year next.

Kaz Nejatian: We launched Buyer Peace of Mind, giving people certainty when they buy their home with benefits like home warranty and early move-in. We launched AI-powered multilingual agents explaining home valuation to homeowners and helping them move forward with Opendoor. We're launching a new partnership with Roam, connecting sellers with Roam's Assumable Mortgage platform to help them move when they want to. We've also made significant improvements in our SEO products, significantly increasing organic traffic. Closest to my heart has been our push to default to AI everywhere. This has allowed our frontline operators to iterate without writing code. One of our non-technical teammates built a no-code tool that cut our quarterly inventory management process from 10 hours to about seven minutes. This list of launches should show you that we have this renewed aggression at Opendoor. We're going to focus on building great products.

Next year, we're going to see a dramatic change in profitability.

Let me walk you through some of the details so as we shared in the prepared remarks, we are driving the company.

Net income profitability exiting 2026 on a 12 month go forward basis.

The framework to achieve that goal requires us to rescale acquisitions, we guided to where you're scaling acquisitions and growing them by 35% quarter over quarter for Q4 of 2025, and we are driving to exit Q4 of 2026 by buying somewhere around 6000 homes, you can track our progress against that.

Goal and hold us accountable to that goal at accountable Dot opened our dot com, which will be updated weekly.

On the margin side, we expect to get contribution margin of five 7% as we approach the acquisitions with renewed rigor decreasing tail homes improving days in possession, and therefore holding costs. In addition, as we get more shots on goal and buy more homes, we get the opportunity to attach more products and drive margin.

And from the ancillary services.

We expect financing costs of 2% to 3% of revenue. These costs are highly sensitive to our turns and will benefit from our faster resale velocity.

Kaz Nejatian: Aggression by itself is not a strategy. It's better than hope, but it's not enough. Here's our four-step plan to channel that energy. First, by the end of next year, we will drive Opendoor to break even. We think about this in terms of adjusted net income on a 12-month go-forward basis. That means Opendoor will start generating cash and will never be forced to raise equity ever again. Second, we will drive significant positive unit economics while increasing the velocity at which we transact in homes. This includes launching financial services like mortgage. Third, as we increase our unit economics, we will change the company's focus from primarily building channels to transacting directly with buyers and sellers. We're also going to focus on reducing our days in possession rather than arbitrarily increasing spread, which has had genuine significant negative consequences for us.

Targeting adjusted Opex of 3% to 4% of revenue.

To leverage our existing fixed opex structure is cashman. She mentioned she invest slightly more in marketing, but with the discipline that has discussed earlier and we expect to scale operations marginally as we rescale volumes.

Our framework, it's not new guidance.

Add to this if you don't mind.

I spend the last few years of my career at Shopify, and I think as folks would say that it had something obviously not everything.

To do with Shopify profitability and growth.

In late 2022, when I became shopify as Chief operating officer.

I'm going to read this because it was a quote.

Analysts said Shopify quote shopify will lose money every year through 2025 profitably is nowhere to be seen.

Kaz Nejatian: Fourth, once we've accomplished the first three steps, we're going to focus on allowing buyers and sellers to transact on Opendoor without having to buy or sell from Opendoor. This is going to significantly lower our capital risk, but more importantly, it's going to give folks options they want. Over time, as we succeed in these initiatives, Opendoor will change the homeownership experience in the same way Amazon changed the shopping experience, both directly and through its third-party marketplace. Let me be clear. Adjusted net income break-even is a milestone, not a goalpost. We have a huge runway ahead of us. Yes, there's going to be some headwinds. We're going to get some things wrong, but we're committed to consistently delivering improved unit economics, and you're going to begin seeing progress towards adjusted net income break-even milestones as we clear old inventory and increase our acquisition speed.

Well shelf I became profitable two quarters after I became CLO and it has been profitable every since hit the rule of 40 every quarter.

Companies don't become profitable and excel sheets.

The way this works pragmatically is what.

You know, that's what John and I did at Shopify.

You create a list of projects you put odds adjusted odds of success against each of them execute every single day.

At Shopify, we hired a few dozen of these three or four of them ended up really mattering and we had the same list here, we have a list of projects and the reason I say draw.

Drive to profitability is because this is not a passive thing it's not just going to happen to us we know what we're going to do we're going to take those actions and we're going to exit 2026, and I profitable on a go forward basis.

Sorry, I cut you off that's great great.

Great.

Our next question comes to Us from Victoria B.

Kaz Nejatian: In my first month, we've already made significant progress on the first three steps. As we move towards break-even adjusted net income, we're prioritizing durable cost reductions. Christina's going to talk about some of these, but I want to give you some examples. We've reduced spend on external software and have terminated or are in the process to terminate over 20 software vendors to date. We've reduced spend on external consultants. Opendoor spent millions on management and PR consultants in the first half of 2025. The go-forward plan is zero. To drive positive unit economics and increase the velocity at which we transact in homes, we've significantly changed our buying behavior. For example, up until mid-October, when someone came to opendoor.com and typed in their address to sell us their house, we would have up to 11 Opendoor employees in the hot path of that sales contract closing.

Short sellers keep attacking open door, spreading negativity and driving the stock down despite strong progress.

Your strategy as CEO to fight these daily short selling pressures protect shareholders mixture. The markets. He has opened doors to true strength.

Look I care, a great deal about our average shareholder.

And you've seen us do something today to help align us to our average shareholder.

Having said that I don't spend that much of my time thinking about short sellers.

I didn't I never worked on Wall Street, and I generally don't understand why these people do what they do it just seems deeply boring.

I'd like to just bad for the soul.

I, mostly just pity them.

They don't really build anything.

Look we run the company for long term owners.

Not for people to bet against US every week and what matters to US is execution week in week out how fast we buy and sell homes, how operationally excellent. We are how we turned over inventory.

Kaz Nejatian: Today, that number in many of our flows is down to one person. That one person is there to audit the machine to make sure we don't make unnecessary mistakes in underwriting. In fact, we're now doing almost 750 home assessments per week using AI. It used to take us close to a day from the time we collected artifacts to the time we completed assessments. In our new flows, this takes about 10 minutes. In the last week of September, we entered into contracts to buy 128 homes. In the last week of October, we entered into contracts to buy 230 homes. To accelerate transaction speeds and customer choice, we can now accept USDC as a payment method for home purchases. To make the company primarily D2C, we've turned on Opendoor's D2C flow once again. The company had completely shut down almost all of these flows.

I think the best way to deal with short seller is just proved them wrong through numbers.

Every quarter, we're going to improve unit economics every quarter I'm going to get better every week show you. The numbers were good all the right things and I think when you do that to score takes care of itself.

Great.

Our next question comes from Daily from J P. Morgan.

How do you define opens identity.

Do you see as its biggest strength.

And how would you leverage that to achieve sustainable growth and profitability as open navigates. The currently depressed housing market and longer term.

That's a quick question.

I'll take your first if you don't mind.

Look open door is a software company, we're not a hedge fund waiting for macro to turnaround that's our job.

Our job is to help people sell and buy and own homes and our leverage comes from building excellent products and you do that by fighting excellent code. So that's the largest source of.

Kaz Nejatian: Look, while we want customers who want experts to be able to work with one, we are once again accepting customers who want to sell us their home directly. Last week, these customers made up over 20% of our total homes assessed. In a test we ran in mid-October, on over 2,000 accounts created, we saw that our new D2C totally unoptimized funnel was able to convert six times better than the non-D2C funnel. We're far, far from optimizing this, but we believe we have significant opportunity to improve our overall conversion. Okay. That's a lot. Before I hand it off to Christy, I want to spend a minute to talk to you about previous decisions Opendoor made about its capital structure. Because, look, I think it's important that you hear from me directly about this.

Our leverage rate code written by our engineers data on our databases and our models we have.

And we're improving the value not just the valuation of home.

But dispersion on them and days in possession.

And I firmly believe the best software companies are built in hard times.

The first is the times, where you to be disciplined right.

You end up having to care about your user more you end up building deeper integrations that solve more of the problem. So when times get good you end up having abnormally large profits.

I'm very bullish on the company just in the last couple of weeks. We've shown we can grow acquisitions relatively quickly I think we grew 60% on acquisitions. Just this past week, we will see how much we grow next week.

Kaz Nejatian: When I took this job, I knew Opendoor needed a balance sheet that was fit for our ambitions. Every home needs a solid foundation, and for us, that's capital. There are aspects of our balance sheet that are just genuinely phenomenal. We have 10 different lending facilities with long-standing partners, some of them as long as nine years, who've demonstrated their ability to scale with us as we grow. Today, we can finance roughly 5,000 homes all at once and close at almost 100% advance rate at great prices. At our peak, that number was about 20,000, and we're going to get back there. I'm genuinely confident that we can get there with our lending partners. They're also part of our capital structure that we're not focused on the long term. They seem to have been designed and driven by fear rather than setting us up to win.

And we've shown that we have relatively good levers in this company and when you decide that you're going to do that do you have the good leverage a great software and a balance sheet that we do.

You get the chance to go on offense.

And I'm I really like our odds I think things are starting to work for us.

Great.

Our next question comes to Us from Ryan Tomasello from K B W.

Management intend to continue to emphasize the cash offer is open doors primary product or do you envision moving the business more capital light.

Well the key agent program would be the primary distribution channel for the cash offer and if so how should we think about potential bottlenecks on growth given this high touch approach tied agents.

That's not how I think of the business to be honest, let me ask let me ask the question first look I think companies fail.

Kaz Nejatian: To be blunt, when I joined, the balance sheet had a tank clock. The company had issued convertible notes with an early repayment that could have forced us to repay them in full before the end of this year. That would have been disastrous for the company. My first priority was to remove this pressure and give us a runway to execute on our vision. Let me be clear. I despise dilution. If we issue a share, it has only one job: to make every other share worth more for our existing shareholders. To give us some breathing room, I made a decision in my first week to use our existing ATM program to raise nearly $200 million. This bought us the time we needed to deal with the notes without a gun to our head. Earlier today.

When they think of themselves first and their users second like.

Our job is to serve our users and people come to us to sell or buy a home that's already come to us and our job is to meet them, where they are some of them want to use an expert some of them don't and her question is gonna be answer Istent cashed, a great product I think cash plus is a great product, we're going to have <unk>.

Different products, along both the risk and the ownership axes, because I think that's just not the final two products are going to have.

And I like our D to C model I think we talked about how in our test early on has been converting six X better.

So I think the question isn't really one of which channel you're going to pick we're going to pick the channels allow us to have the maximum impact on behalf of our users.

Kaz Nejatian: We reached an agreement to retire the majority of these notes. We took the steps we needed to clean up our capital structure, and we now have the balance sheet we need to stop playing defense and start playing offense. There's a second part to this, and it's about you. We wouldn't be here without you, our shareholders. You believed in the long-term value of this business, even when our capital structure didn't really reflect it. I don't believe in asking you to stay on this journey without sharing directly in the upside we're creating together. Look, public markets have a long history of taking shareholders for granted. We're not going to do that. In fact, we're going to reverse that. This is why we're issuing a dividend warrant.

And I firmly believe in our DTC channels are going to be the future of the company and if there are users that want to use experts we want to serve them where they are.

Great.

We have a few questions on sustainable acquisition growth. So I'll review those out one from Yigal at city, how are you expecting to manage guardrails on acquisitions as you pick up pace. Another from Andrew at citizens can you talk about controlling the long tail and how those purchases have outsized losses.

And Nick Mcandrew at Zelman, how do you balance near term transaction growth with your stated goal of evolving into a platform business.

Okay.

Let's try to take these one at a time.

I think the tail question is actually a best question, let me take that one first so.

We actually want to have is a lot of dispersion and yard present in your model right opening doors drifting not had that.

Kaz Nejatian: Each of you will receive three series of warrants: Series K, Series A, and Series Z, with exercise prices at $9, $13, and $17. One warrant for each series of 30 shares you hold. These warrants are going to cost you nothing, and their value goes up as we make Opendoor into what it can be. We want to be on the same side of the table as our shareholder. We're returning some value to you today. You can sell the warrants as soon as you get them, but I'm hoping that you'll stay along for this ride, that you'll participate in what we are building together. We're going to move forward together, and when Opendoor succeeds, our shareholders are going to share in that success. Yes, I'll admit it.

Where it has kind of had a peanut butter spread across that space.

We now have significant dispersion and this is basically all we talked about is how we can have excellent offer on good home will be no days in possession, who's going to be low and be more careful on longer longer days and possession homes.

And we have a new process.

For inspecting every home.

To make sure that we don't get caught by surprise. This is the trust, but verify approached I talked about which will be great. Because it will have both a variable cost and be more importantly allows us to have lots of data on our servers.

Kaz Nejatian: It gives me just a bit of joy that this will totally ruin the night of a few short sellers. Look. We're building a new company right in the open. Opendoor 2.0 is committed to its community because we're building, and because who we're building for matters. We're going to talk to you the way we talk in the office, in plain English, sometimes with a few cuss words, but always with transparency. Please consider this our clean break from corporate jargon. We're just going to talk to you and tell you when we make mistakes. We know that this transparency is not a burden. It's a feature of your trust in us. We want to hear from our shareholders, your ideas, your questions, and even product bugs, because we want to fix things fast and build better. If you haven't already seen this, my DMs are opendoornex.com.

Last question second.

I don't think these two things alright conflict.

Look at Shopify, we had high growth and high free cash flow.

I think these two things actually go together because.

When you buy lots of homes, you get opportunities to sell lots of hopes and where you sell lots of homes to get opportunity to attach additional services to them.

And I think these two things go hand in hand.

The first question last.

Look I think we've shown that we have really good levers at our disposal.

Morgan and the growth team had been working only for a couple of weeks now, but every single day, we're seeing improvement on buying the types of whom we want to buy and we really like our top of funnel.

We have cut marketing and have seen acquisition go up which is always a good sign I missing something.

Kaz Nejatian: I am more bullish today about Opendoor's ability to change homeownership than I was when I took this job. I'm more bullish because I see a lot more of what is happening inside the company than folks see from the outside. I think one of the ways in which we can bring you all along for this journey is to just communicate more frequently, more directly, and tell you what we are doing, what's working, what's not. Christine's going to tell you a bit more about how we need to do this after she shares our third-quarter results. Christine? Thank you, Kaz. Our third-quarter results reflect the deliberate choices made earlier in the year to prioritize risk management over volume growth, defined by widespreads and a risk-averse posture that treated buying homes as something to avoid rather than our core business. The numbers tell the story.

Great.

We have another question from Ben Black with D. B has a few in there but it's the last question was in what ways can AI be an accelerant to growth.

Okay.

When you look in all the ways.

We always look I don't spend.

Got much of my time.

Worrying about.

The problems open door has traditionally had on this area because they've been different types of problems I spent a long time, but what the problems are today, let me give you. One example, I talked about this a bit.

We would have up to 11 people touch a home before me had a sales contract going for it today in many of our flows that's down to one and a jump about one person is to watch the machine right. This significantly reduces opex per home that we acquire far far far.

Kaz Nejatian: In the third quarter, we purchased 1,169 homes, roughly in line with the expectations shared at Q2 earnings, but well below our recent historical acquisition volumes. We delivered revenue of $915 million, above the high end of our guidance, as we deliberately cleared old inventory before the slower winter selling season. When you stop buying homes, you don't just lose volume, you lose the ability to manage your inventory mix. We were left selling through older homes that were selected under the old strategy, and that showed up in our margins. GAAP gross profit was $66 million in Q3, compared to $105 million in Q3 of the prior year. GAAP gross margin was 7.2%, down 40 basis points year over year. Contribution profit was $20 million, and contribution margin was 2.2%, compared to contribution profit of $52 million and contribution margin of 3.8% in Q3 2022.

Fewer human beings far more machines. This is better speeds better user experience lower opex win win win.

Secondly on the.

Just a top of funnel part.

You've seen us cut marketing and we cut marketing.

Came in and decreased acquisition, we're able to do this because we can optimize our funnels and put more of the experience in the hand of the user and by the way AI is also able to help us explain to our users the valuation of each home.

So across top of funnel middle funnel bottom of funnel already we are seeing the impact of AI and we're also seeing the impact on closing, which is the last step where we've had machines do much work for closing these days and that's going to continue.

Kaz Nejatian: On costs, prior leadership did meaningful work to restructure our cost base, and we will continue that effort. Third-quarter GAAP operating expenses totaled $134 million. Adjusted operating expenses were $53 million, a 41% improvement from $90 million in the third quarter of 2024. This improvement was driven by disciplined cost management across all components: marketing, operations, and fixed operating expense. As we rescale acquisitions, we're doing it from the structurally lower cost base. Net loss for the third quarter was $90 million, compared to a loss of $78 million in Q3 2024. The prior year number included a $14 million gain from the mainstay deconsolidation. Adjusted net loss totaled $61 million, an improvement from an adjusted net loss of $70 million in the prior year period. These are the results of the old Opendoor. What matters now is what comes next. Earlier, you heard the plan for Opendoor 2.0.

Great.

We had one more question from Margaret M S. How.

How can you guys make homeownership easier for younger generations.

I mean this is like the.

The fundamental Gould the company look.

Home prices have increased by some 50% since 2020.

Mortgage rates are much higher than they used to be housing inventory is far too low typical sale of taking like 60, plus days and like one in seven deals are falling through.

And the average time for a person to buy a home is almost 40 now.

This is just terrible 'cause, it's harming our communities harming their families.

And people, who want to own are facing real barriers.

Kaz Nejatian: I'd like to take a moment to walk through the foundation it runs on, our capital. We ended the quarter with $962 million in unrestricted cash, and $187 million of equity invested in homes. We held 3,139 homes, representing $1.1 billion in net inventory. We had $7.6 billion in non-recourse asset-backed borrowing capacity, of which total committed borrowing capacity was $1.8 billion. As Kaz mentioned, we have executed three substantial capital transactions to set our balance sheet up for the scale ahead. First, the rapid increase in our stock price triggered a condition in our 2030 convertible notes that could have required us to repay the full principal balance in cash during the fourth quarter of 2025.

Feel trapped in their homes because mortgage rates. This is why we announced our partnership with rohm today.

But there really isn't any one group of people or any one company. That's just not how it works the enemy is the process.

So many people involved in the process of you buying and selling a home that the costs are just out of hand, and wonder if things I'm Super excited about is.

And the fact that we can underwrite at home.

Excellent power to underwrite mortgages and the fact that we can do things.

Things that allow you to buy a home earlier.

By better home earlier, and nobody had the peace of mind to buy it.

Kaz Nejatian: Using our At the Market, or ATM Equity Program, we proactively raised equity in September 2025, selling 21.6 million shares at a weighted average price per share of $926 for nearly $200 million of gross proceeds. Second, today, we refinanced a substantial portion of the 2030 notes with equity. As a reminder, these notes bear interest at a 7% annual rate. The combination of these two transactions adds meaningful liquidity to our balance sheet, reduces our cash interest costs, and provides enhanced financial flexibility. Third, to align Opendoor's upside with all shareholders, our board declared a pro rata warrant dividend. Every shareholder will receive three series of freely tradable warrants for every 30 common shares held as of the 18 November record date, with exercise prices of $9, $13, and $17.

Is it going to keep part of the company's future.

But that's the mission right took the world towards homeowners and people who are working hard to become homeowners.

Great.

We're getting close to the top of the hours. So that was our last question. So it has if you have any closing remarks.

Yeah.

Let me thanks I appreciate it thanks for the question folks.

Look I spend most of my day, and cursor and get hub I don't spend much of my time in spreadsheets.

I started writing code on my Commodore 64, when it was six.

And I'm opinionated about what open doors product should look like.

We are a product company building software to enable homeownership.

And you've seen us launch many products.

Mr products, just in the past few weeks.

Kaz Nejatian: Zooming out, we believe we have the right capital setup for the Opendoor 2.0 operating model: higher volumes, faster turns, tighter spreads, and more products to serve homeowners. Now let me tell you how we're executing against that model and how you can hold us accountable. We are targeting to reach adjusted net income profitability by the end of 2026, measured on a forward 12-month basis. To get there, we're focused on three key management objectives that we monitor internally. For each objective, I want to frame for you why this matters, what we're doing, and how you can hold us accountable. First, scale high-quality acquisitions. More volume means more revenue from transactions and ancillary services, plus better leverage of our cost base. Further, market concentration creates a flywheel. When we own a meaningful share in a market, we attract more inventory, which attracts more buyers, which attracts more sellers.

You should expect us to do the same.

And you should expect us to be operationally excellent.

Would we mindful of your dollars as our shareholders.

You're going to just be accountable.

We're going to make mistakes along the way, but every single step.

We're going to see us cared deeply about our mission and be transparent as we build I mean.

Let it be bullish I am more bullish today than I was when I took this job and I think we're going to actually make a change and make a real difference and future of homeownership in this country.

Great with that we'll conclude our third quarter open house.

Hum.

Okay.

Oh.

Kaz Nejatian: We have multiple initiatives underway to drive this growth. Most importantly, as Kaz described earlier, we started reducing our average spread while increasing our operational rigor and selection: stronger offers for high-velocity, high-quality homes, discipline on higher-risk homes. We're pairing that with AI-driven scoping and standardized pre-offer inspections to raise conversion and cut time and costs from offer to acquisition. You can track our progress against our acquisition goals through the end of 2026 on our new dashboard at accountable.opendoor.com. Individual weeks will fluctuate, holidays, weather, local market events will be focused on the trajectory over time. Second, improve unit economics and resale velocity. Speed and profitability per transaction enable us to build a sustainable business while enduring macroeconomic changes. Higher profitability per transaction gives us the ability to decrease the spreads embedded in our offers, leading to more acquisitions. This objective is supported by our tailored spread framework.

Okay.

Yes.

Okay.

Yes.

Uh huh.

Mhm.

[music].

Thank you.

[music].

Kaz Nejatian: By pricing more aggressively for high-quality, faster-selling homes and maintaining discipline on higher-risk assets, we expect our acquisition mix to skew toward more marketable homes that need less repair and renovation. We expect this to shorten the time from acquisition to listing and days on market, thereby reducing our holding costs. Second, we are innovating at an incredible pace with a renewed focus on execution and a culture of challenging everything to be better. Much of our product innovation is designed to automate workflows and increase resale velocity, supporting a business model focused on turns, not spread. You can hold us accountable to improving resale velocity by tracking the percentage of Opendoor homes on the market for greater than 120 days, which we report quarterly in our 10Q. You can also follow our product, feature, and partnership launches on accountable.opendoor.com to see how we're building with velocity into the business.

Kaz Nejatian: Third, build operating leverage. We will scale transactions faster than fixed costs, so each additional home adds accretive profit. We're cutting aggressively in the right places, eliminating consultants, removing redundant tools and software, reducing marketing waste, and streamlining operations, while simultaneously reinvesting a portion of those savings into engineering, and AI automation. Importantly, we expect to shift our overall operating expense profile toward variable components that flex with volumes, rather than remain fixed through cycles. You can hold us accountable by tracking two specific metrics we report quarterly in our 10Q. Fixed operating expenses should hold relatively steady as we rescale volumes, and trailing 12-month operations expense as a percentage of trailing 12-month revenue should hold relatively steady or decrease over time. These three objectives are the foundation of our path to profitability, and we're building in the open, so you can track our progress along the way.

Kaz Nejatian: Turning to our outlook, our guidance is going to look different than what you've seen in previous quarters. Our business is changing rapidly. Just in the past few weeks, our acquisition contract speed increased by nearly 2x. We're focused on execution and outcomes, not on benchmarking every turn during the transformation of this scale. Our results in the upcoming quarter are largely the outcome of us managing decisions that were made several months ago. We're focused now on making the right long-term decisions for the business, not managing the short-term guidance. What matters, and what we want to be held accountable for, are the actions we take from here and the results they drive over time. Our destination is clear: adjusted net income profitability by the end of next year, measured on a 12-month go-forward basis. We've already seen the levers in this business work.

Kaz Nejatian: You can't build a break-even business in a spreadsheet. You build it by shipping product, operating with discipline, and learning from the market. For the near term, I will provide you with these guideposts. Acquisition rescaling. We're committed to rescaling acquisition volumes. We expect fourth quarter 2025 acquisitions to increase by at least 35% from Q3 as our product launches and pricing strategy changes take hold. You can track our weekly acquisition progress at accountable.opendoor.com. Revenue. We expect Q4 revenue to be higher from the outlook we provided at Q2 earnings, but decrease approximately 35% quarter over quarter due to low inventory levels from Q3's reduced acquisition volumes. Contribution margin. Our priority since mid-September has been to clear old inventory homes selected under the previous strategy that prioritized spread over quality. That's pressured our contribution margin sequentially since April through October, and we believe we bottomed out in October.

Kaz Nejatian: Margins will improve through the end of the year as we replace legacy inventory with better homes, but Q4 contribution margin will be below Q3 as we reverse the downward trend. Cost discipline. We are focused on continuing to manage and improve our cost structure. Adjusted operating expenses for the 12 months ended 30 June 2025 were $307 million. For the 12 months ending 30 June 2026, we expect to spend $255 million to $265 million. Excluding the $15 million cash May Cole Award for our CEO, this is a year-over-year decrease of approximately $62 million, or 20% at the midpoint. We expect to achieve these savings while concurrently investing in engineering, and AI automation, to drive further operating leverage. We're cutting the waste and reinvesting in what matters. Finally, adjusted EBITDA.

Kaz Nejatian: Given the near-term margin pressure as we clear old inventory, we expect Q4 2025 adjusted EBITDA loss in the high $40 millions to mid-$50 millions. We're building Opendoor 2.0 in the open, holding ourselves accountable to measurable objectives, and giving you the transparency to track our progress. The journey won't be perfectly linear, but our conviction in the destination and in the levers that get us there is unwavering. With that, Michael, I'll turn it over to you for questions. Great. Thanks, Christy. Our first question comes to us from video submission from Vlad Tenev. What's up, Kaz? By the way, we're super pumped that you guys are streaming live to retail on Robinhood. I think the question on everyone's mind is, what's going on with tokenization? How real is it? How do you think it could revolutionize the homeownership experience? Thanks, Vlad. Thanks for hosting us.

Kaz Nejatian: Look, I'm such a big fan of Robinhood, and I hope that we can continue to do things together. Our mission at Opendoor is to tilt the world towards homeowners and those working hard to become homeowners. I love that Robinhood does some of the same things, you know, this whole thing of taking power away from fancy people and giving to the average person. Now, to answer your question, I have a habit of not announcing products before they're launched. That's because I build products, not spreadsheets. I think it's important that we ship things before we talk about them. I don't want to say we're going to do this next week, but I generally can't imagine a future where real estate's not tokenized. I also can't imagine a future where Opendoor isn't leading innovation in real estate.

Kaz Nejatian: Look, asset tokenization is not a side quest for us. Tokenization allows us to increase the speed of transactions, decrease the cost of transaction, and broaden the base of homeownership. That's our job. Today, we talked about how we can now accept USDC. This week, I bought Bitcoin on my own laptop so we can start developing. We've begun talking with partners about how we can work across stablecoins and tokenization. The work is active. We're very serious about it, and we'll tell you more when we launch something. Great. Our next question comes to us also via video submission from Eric Jackson. Hi, Kaz. Eric Jackson, welcome. On behalf of the entire Open Army, we are thrilled to have you here leading the charge. I have two questions. Can you say specifically what the headcount is now at the company? I believe it was 1,407 over the summer.

Kaz Nejatian: Can you say more about the revenue opportunities that you see around iBuying? Do you expect to add mortgage, title, and other ancillary services? Zillow experimented with doing this a few years ago by acquiring a legacy company, and that didn't really take. What is the Kaz approach to revenue, and how do you expect to grow this in the coming quarters? Thank you again. Thanks, Eric. Look, to start with, I think Opendoor has had far too complicated a structure for a company of this size. To give you a sense, we've had 11 different HR software products. We're going to go down to one. As of this morning, there were 1,100 people working at Opendoor. The most important thing isn't the number of people, but how aggressive and efficient those people are.

Kaz Nejatian: I believe every single Opendoor employee needs to be two to three times more aggressive and more efficient than the average employee in tech. We will have the most aggressive software company in the public market because our mission is incredibly important. Like I said in the prepared remarks, our job is to be incredibly mindful of OPEX and to reduce our fixed OPEX over time so that it becomes a smaller and smaller part of our income statement. Oh, the second question. Look, I'm incredibly bullish on what I call services. When I joined Shopify, Shopify was 50/50 in its revenue between SaaS and services. Today, services are 75% of Shopify's revenue. While I didn't have everything to do with it, I had something to do with it and was the services guy at Shopify.

Kaz Nejatian: The reason why these embedded fintech things typically don't work is because they're usually designed by some dude in a boardroom trying to figure out, how can I make more money from my users? That's what it takes to typically work. That's just not how users interact with products. We will build excellent products. They will feel whole, and you will buy a home from Opendoor the same way you buy a car from Tesla or something from Amazon. They will feel like one product, and they won't be a different bunch of different cross-sell motions that you have to keep feeling like you're talking to different companies. I hope that answers your question. Great. Our next question comes from Zach H., who asks, when will we see a dramatic change in profitability? Next year. The answer is next year. We're going to see a dramatic change in profitability.

Kaz Nejatian: Zach, let me walk you through some of the details. As we shared in the prepared remarks, we are driving the company to adjusted net income profitability exiting 2026 on a 12-month go-forward basis. The framework to achieve that goal requires us to rescale acquisitions. We guided to rescaling acquisitions, growing them by 35% quarter over quarter for Q4 2025. We are driving to exit Q4 2026 by buying somewhere around 6,000 homes. You can track our progress against that goal and hold us accountable to that goal at accountable.opendoor.com, which will be updated weekly. On the margin side, we expect to get a contribution margin of 5% to 7% as we approach the acquisitions with renewed rigor, decreasing tail homes, improving days in possession, and therefore holding costs.

Kaz Nejatian: In addition, as we get more shots on goal and buy more homes, we get the opportunity to attach more products and drive margin from ancillary services. We expect financing costs of 2% to 3% of revenue. These costs are highly sensitive to our turns and will benefit from our faster resale velocity. We're targeting adjusted OPEX of 3% to 4% of revenue. We expect to leverage our existing fixed OPEX structure, as Kaz mentioned, to invest slightly more in marketing, with the discipline that Kaz discussed earlier. We expect to scale operations marginally as we rescale volumes. That's a framework. It's not new guidance, but it's—yeah. No, Kaz, I'm going to add a little to this, if you don't mind.

Kaz Nejatian: Look, I spent the last few years of my career at Shopify, and I think folks would say that I had something, though obviously not everything, to do with Shopify's profitability and growth. In late 2022, when I became Shopify's Chief Operating Officer. I'm going to read this because it was a quote. It was an analyst that said, Shopify will lose money every year through 2025. Profitability is nowhere to be seen. Well, Shopify became profitable two quarters after I became COO, and it has been profitable ever since, and it's hit the rule of 40 every quarter. Companies don't become profitable in Excel sheets. The way this works pragmatically is what. You—it's what Jung and I did at Shopify. You create a list of projects. You put odds adjusted, odds of success against each of them, and you execute every single day.

Kaz Nejatian: At Shopify, we had a few dozen of these. Three or four of them ended up really mattering. We have the same list here. We have a list of projects. The reason I say we're going to drive to profitability is because this is not a passive thing. It's not just going to happen to us. We know what we are going to do. We're going to take those actions, and we're going to exit 2026 AI profitable on a go-forward basis. Sorry, I cut you off. That's great. Great. Our next question comes to us from Victoria B. Short sellers keep attacking Opendoor, spreading negativity, and driving the stock down despite strong progress. What's your strategy as CEO to fight these daily short selling pressures, protect shareholders, and make sure the market sees Opendoor's true strength? Look, I care a great deal about our average shareholder.

Kaz Nejatian: You've seen us do something today to help align us to our average shareholder. Having said that, I don't spend that much of my time thinking about short sellers. I never worked on Wall Street, and I generally don't understand why these people do what they do. It just seems deeply boring and just bad for the soul. I mostly just pity them. They don't really build anything. Look, we run the company for long-term owners, not for people that bet against us every week. What matters to us is execution week in, week out, how fast we buy and sell homes, how operationally excellent we are, how we turn over inventory. I think the best way to deal with short sellers is just prove them wrong through numbers. Every quarter, we're going to improve the economics. Every quarter, we're going to get better.

Kaz Nejatian: Every week, we're going to show you the numbers. We're going to do all the right things. I think when you do that, the score takes care of itself. Great. Our next question comes from Day Lee from JPMorgan. How do you define Open's identity? What do you see as its biggest strength, and how will you leverage that to achieve sustainable growth and profitability as Open navigates the currently depressed housing market and longer term? That's a great question. I'll take it first if you don't mind. Look, Opendoor is a software company. We're not a hedge fund waiting for macro to turn around. That's not our job. Our job is to help people sell, buy, and own homes. Our leverage comes from building excellent products, and you do that by writing excellent code. That's the largest source of our leverage, right?

Kaz Nejatian: Code written by our engineers, data on our databases, and the models we have. We're improving the value, not just the valuation of home, but dispersion on them and days in possession. I firmly believe that the best software companies are built in hard times because the times force you to be disciplined, right? You end up having to care about your user more. You end up building deeper integrations that solve more of the problem. When times get good, you end up having abnormally large profits. I'm very bullish on the company. Just in the last couple of weeks, we've shown that we can grow acquisitions relatively quickly. I think we grew 60% on acquisitions just this past week. We'll see how much we grow next week. We've shown that we have relatively good levers in this company.

Kaz Nejatian: When you decide that you're going to do that, you have the good levers, you have great software, and you have the balance sheet that we do. You get the chance to go on offense. I really like our odds, and I think things are starting to work for us. Great. Our next question comes to us from Ryan Tomasello from KBW. Does management intend to continue to emphasize the cash offer as Opendoor's primary product, or do you envision moving the business more capital light? Will the key agent program be the primary distribution channel for the cash offer, and if so, how should we think about potential bottlenecks on growth given this high-touch approach tied to agents? It's just not how I think of the business, to be honest. Let me ask you a question first. Look, I think companies fail.

Kaz Nejatian: When they think of themselves first and their users second, our job is to serve our users. People come to us to sell or buy a home. That's why they come to us, and our job is to meet them where they are. Some of them want to use an expert, some of them don't. The question is, how do we answer it? I think cash is a great product. I think cash plus is a great product. We're going to have different products along both the risk and the ownership axes because I think that's just not the final two products we're going to have. I like our D2C model. I think we talked about how in our tests early on, it had been converting 6x better. I think the question isn't really one of which channel are you going to pick.

Kaz Nejatian: We're going to pick the channels that allow us to have the maximum impact on behalf of our users. I firmly believe our D2C channels are going to be the future of the company. If there are users that want to use experts, we want to serve them where they are. Great. We have a few questions on sustainable acquisition growth, so I'll read a few of those out. One from Ygal at Citi, how are you expecting to manage guardrails and acquisitions as you pick up pace? Another from Andrew at Citizens, can you talk about controlling the long tail and how those certain purchases have outsized losses? Nick McAndrew at Zellman, how do you balance near-term transaction growth with your stated goal of evolving into a platform business? Okay, I'll try to take things one at a time.

Kaz Nejatian: I think the tail question is actually the best question. Let me take that one first. What you actually want to have is a lot of dispersion in your model, right? Opendoor has traditionally not had that, where it has kind of had peanut butter spread across its base. We now have significant dispersion, and this is basically all we talk about, is how we can have excellent offer on good homes where we know days in possession is going to be low, and be more careful on longer days in possession homes. We have a new process for inspecting every home to make sure that we don't get caught by surprise. This is the trust but verify approach that I talked about, which will be great because it'll both be a variable cost, and, more importantly, allows us to have lots of data on our servers.

Kaz Nejatian: Last question, second. I do not think these two things are at conflict. Look, at Shopify, we had high growth and high free cash flow. I think these two things actually go together because when you buy lots of homes, you get opportunities to sell lots of homes. When you sell lots of homes, you get opportunity to attach additional services to them. I think these two things go hand in hand. Time for the first question last. Look, I think we have shown that we have really good levers at our disposal. Morgan and the growth team have been working only for a couple of weeks now. Every single day, we are seeing improvement on buying the types of homes we want to buy, and we really like our top of funnel.

Kaz Nejatian: We have cut marketing and have seen acquisition go up, which is always a good sign. Am I missing something? No. That was great. We have another question from Ben Black with Deutsche Bank. There's a few in there, but his last question was, in what ways can AI be an accelerant to growth? I mean, look, in all the ways, in basically all the ways. Look, I don't spend that much of my time worrying about the problems Opendoor has traditionally had on this area because there have been different types of problems. I spend a lot of time about what the problems are today. Let me give you one example. I talked about this a bit. We would have up to 11 people touch a home before we had a sales contract go out for it. Today, in many of our flows, that's down to one.

Kaz Nejatian: The job of that one person is to watch the machine, right? This significantly reduces OPEX per home that we acquire. Far, far, far fewer human beings, far more machines. This is better speed, better user experience, lower OPEX, win, win, win. Secondly, on just the top of funnel part, you've seen us cut marketing, and we cut marketing when I came in, and increased acquisition. We're able to do this because we can optimize our funnels and put more of the experience in the hand of the user. By the way, AI is also able to help us explain to our users the valuation of each home. So across top of funnel, middle of funnel, bottom of funnel, already we are seeing the impact of AI.

Kaz Nejatian: We're also seeing the impact on closing, which is at the last step, where we've had machines do much of the work for closing these days. That's just going to continue. Great. We had one more question from Margarita M., who asked, how can you guys make homeownership easier for younger generations? I mean, this is like the fundamental goal of the company. Look. Home prices have increased by something like 50% since 2020. Mortgage rates are much higher than they used to be. Housing inventory is far too low. Typical sale is taking like 60-plus days, and like one in seven deals are falling through. The average time for a person to buy a home is almost 40 now. This is just terrible because it's harming our communities, harming our families, and people who want to own are facing real barriers.

Kaz Nejatian: People feel trapped in their homes because of mortgage rates. This is why we announced our partnership with Roam today. The enemy really isn't any one group of people or any one company. That's just not how it works. The enemy is the process. There are so many people involved in the process of you buying and selling a home that the costs are just out of hand. One of the things I'm super excited about is the fact that we can underwrite a home, which gives us excellent power to underwrite mortgages. The fact that we can do things that allow you to buy a home earlier, buy a better home earlier, and know that you have the peace of mind to buy it is going to be a key part of the company's future. That's the mission, right?

Kaz Nejatian: Tilt the world towards homeowners and people who are working hard to become homeowners. Great. We're getting close to the top of the hour. That was our last question. Kaz, if you have any closing remarks. Yeah. Thanks. I appreciate it. Thanks for your question, folks. Look, I spend most of my day in Cursor and GitHub. I don't spend much of my time in spreadsheets. I started writing code on my Commodore 64 when I was six. I'm opinionated about what Opendoor's products should look like. We are a product company building software to enable homeownership. You've seen us launch many products, like dozens of products, just in the past few weeks. You should expect us to do the same. You should expect us to be operationally excellent and incredibly mindful of your dollars as our shareholders.

Kaz Nejatian: You're going to see us be accountable. We're going to make mistakes along the way. At every single step, you're going to see us care deeply about our mission and be transparent as we build. I'm incredibly bullish. I am more bullish today than I was when I took this job. I think we're going to actually make a change and make a real difference in the future of homeownership in this country. Great. With that, we'll conclude our third quarter open house.

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