NEW YORK, July 14, 2026, 13:07 (EDT)
Opendoor Technologies Inc. NASDAQ:OPEN may see about a $9 million shortfall in cost and mix at its Aug. 4 results, if second-quarter revenue and contribution margin hit the midpoint of its guidance, per company figures. Shares last ticked up 0.1% to $4.49. That’s nearly 70% above Keefe, Bruyette & Woods’ new target. The gap is slim.
Opendoor said Tuesday it will report after the close on Aug. 4, and will hold a 5 p.m. EDT video “Financial Open House” with shareholder questions. Shares tumbled another 5.9% Monday, following Friday’s 10.1% drop, putting the stock around 15% below where it closed July 9. The date for earnings is the trigger, not the call format. Opendoor Technologies Inc.
KBW’s Ryan Tomasello bumped his price target on the stock to $2.65 from $2.25 on Monday but left his Underperform rating in place. The new target sits about 41% under the current share price, even after shares dropped over the past two sessions. The market is still more bullish than that.
Opendoor Technologies Inc. said in May it expects second-quarter revenue of about $900 million, up 25% from $720 million in the first quarter, with a contribution margin between 5% and 7%. Adjusted EBITDA is projected to be about breakeven. Last quarter, contribution profit was $32 million and adjusted EBITDA was negative $31 million. The math is tight.
| Case | Revenue | Contribution margin | Implied contribution profit | Increase from Q1 | Extra improvement needed outside contribution profit |
|---|---|---|---|---|---|
| Q1 actual | $720 mln | 4.4% | $32 mln | — | $31 mln |
| Q2 low end | $900 mln | 5.0% | $45 mln | $13 mln | $18 mln |
| Q2 midpoint | $900 mln | 6.0% | $54 mln | $22 mln | $9 mln |
| Q2 high end | $900 mln | 7.0% | $63 mln | $31 mln | $0 mln |
Numbers are approximate, based on the first quarter’s link between contribution profit and adjusted EBITDA. The company’s management is guiding for breakeven, give or take a few million.
The midpoint guidance shows that better profit per home gets the company roughly $22 million of the $31 million EBITDA jump needed. The last $9 million will have to come from cutting overhead, shifting the business mix, or beating the current targets. If they keep everything else steady and get a 7% margin, contribution profit by itself could make up the gap. There’s not much room for error at the midrange.
Opendoor has already acted on one cost area. In June, the company said it would shut down its India operations and cut 250 jobs as it leans harder into artificial intelligence. CEO Kaz Nejatian said the India team managed “manual workflows across fragmented systems.” Opendoor hasn’t said how much or when it expects to save from the change. Timing could be significant. Reuters
The bull case here is quicker inventory turns. In Q1, 10% of listed homes were held for more than 120 days, down from 33%. Homes bought jumped to 2,474 from 1,706 last quarter. “The machine is working,” Nejatian said. Still, inventory climbed to $1.139 billion from $925 million, and Opendoor had committed to purchase another 1,939 homes for $641 million as of March 31. Now, with more scale, there’s more at stake. Opendoor Technologies Inc.
That pace puts Opendoor in range to hit its revenue target even if profits per home come in light, or nail its margin target off lower volume. The breakeven push mixes both. Investors still have to see if higher acquisitions are turning into profitable resales, not just boosting inventory. One solid result might not cut it.
Shares are still trading well above KBW’s bear case, even after the recent price reset:
| Market marker | Price | Move or comparison |
|---|---|---|
| Closed July 9 | $5.30 | — |
| Closed July 10 | $4.77 | -10.1% |
| Closed July 13 | $4.49 | -5.9% |
| Latest, July 14 | $4.49 | +0.1% |
| KBW price target | $2.65 | 41% under current price |
Opendoor closed at $4.49, giving it a market cap of about $4.31 billion. That’s 4.5 times the $954 million in shareholder equity it reported at the end of March. The company’s first-quarter weighted average shares outstanding jumped 32.6% from last year to 959 million, making per-share gains harder. The stock’s valuation doesn’t leave much margin for anything less than full improvement.
The bridge falls apart if resale speeds drop. Mortgage News Daily said the average 30-year fixed rate was 6.70% on Tuesday. Redfin put June’s median U.S. home-sale price at a record $408,776, a 2.2% jump, with existing-home sales up 4.2% over last year. Strong prices help inventory values. But higher rates make buyers wait and keep holding times up. The setup is mixed.
On Aug. 4, investors will focus on whether contribution margin lines up with costs—not just if revenue hits around $900 million. With a 6% margin, there’s still about $9 million unaccounted for in first quarter costs. At 7%, the numbers match up based on the same math. The market wants to see proof.
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