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Opendoor is laying off 300 employees — about 17 percent of its workforce — as it continues to cope with housing market headwinds, the company said Thursday in reporting a $78 million third quarter loss.
The San Francisco-based iBuyer bought and sold more homes during Q3 than it did a year ago, and keeping a lid on the company’s operating expenses helped trim its net loss by 14 percent from Q2 and 26 percent from a year ago.
With home sales up 35 percent from a year ago to 3,615, Opendoor saw revenue grow by 41 percent over the same period to $1.37 billion. Operating expenses dipped 2 percent from Q3 2023 to $172 million.
Opendoor also beat previous guidance for Q3 acquisitions, boosting home purchases by 12 percent from a year ago to 3,503, despite “persistent housing market headwinds,” CEO Carrie Wheeler said. The company finished the quarter with 6,288 homes valued at $2.1 billion in its inventory, down 4 percent from June 30.
“In August, many anticipated that interest rate cuts would bring buyers and sellers back to the market,” Wheeler said in a statement. “However, mortgage rates remain stubbornly high and the housing market continues to be challenged by high delistings, low clearance, and strained affordability.”
Shares in Opendoor, which in the last year have traded for as little as $1.58 and as much as $4.89, closed at $1.87 Thursday before earnings were announced and briefly climbed above $2 in after-hours tradings.
Opendoor has now racked up $3.61 billion in losses since its initial market launch in Phoenix in 2014. It’s a smaller company than it was in 2022 when it sold 39,183 homes, but it’s also losing less money.
After losing $1.35 billion in 2022, last year Opendoor scaled back home purchases to 11,246 and laid off 680 employees, trimming its 2023 net loss to $275 million.
Opendoor continues to look for ways to cut costs, announcing in August that it was spinning off its single-family rental platform, Mainstay, with Khosla Ventures leading an investment raise to fund the platform as a standalone company.
“We are focused on what we can control, operating our business as efficiently as possible, and streamlining our cost structure while managing risk,” Wheeler said Thursday. “The combination of the actions we took in the second half of this year will result in annualized savings of approximately $85 million as we enter 2025. With a simplified organization and ongoing enhancements in our core products, we are well-positioned to rescale the business as conditions improve.”
