Opendoor's stock rallies as the home buyer shows progress in pivot to leaner business model

By Steve Goldstein

Opendoor reported widening losses but better-than-forecast revenue.

Opendoor Technologies, reported early progress - but widening losses - in its pivot to becoming a less capital-intensive business.

The company that flips the houses it buys online reported a widening loss of $1.1 billion, from a $113 million loss in the year-ago period, mostly on the cost of extinguishing debt.

Revenue fell 32% to $736 million, a deliberate choice as it ended the year with 2,867 homes versus 6,417 a year before.

The $1.26-a-share loss was far wider than the 11-cent loss analysts expected, but revenue came in far ahead of the $594 million consensus, according to FactSet.

Opendoor said revenue in the first quarter will fall sequentially, by 10%, while it expects to end the quarter with the highest margin it's posted since the second quarter of 2024.

The company said it successfully reduced average days in possession by 23% in the fourth quarter. And the share of homes sitting on the market for more than 120 days plummeted from 51% in the third quarter to 33%.

Under new CEO Kaz Nejatian, Opendoor said the cohort of homes it purchased in October was the most profitable it's ever had for that month.

"When the turnaround is real, you get the proof at the cohort level before it shows up in the headline margin," said Eric Jackson, a fund manager who frequently posts above the stock on social media. "Old inventory muddies the income statement. Cohort performance tells you that this new Opendoor 2.0 machine works."

Opendoor shares (OPEN) rallied 17% to $5.46 - about half its peak of $10.87 from September. The stock last year was regarded as a so-called meme stock given the interest by retail purchases.

"OPEN is executing on new management's promises, delivering structural changes that better position the company for 2027," said analysts at JPMorgan led by Dae Lee. But they said Opendoor's path to becoming profitable on an adjusted level next year won't be "linear or easy" as it clears old inventory and tech baggage.

-Steve Goldstein

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02-20-26 0931ET