NEW YORK, August 5, 2026, 11:24 EDT — U.S. markets have opened
- In late-morning trade, shares declined 5.1% to $3.91.
- Opendoor Technologies Inc. reported that Q2 contribution profit increased by 59% from the previous quarter. Stock-based compensation totaled $119 million.
- Preliminary estimate: The Q3 revenue outlook indicates no less than $1.10 billion. The firm anticipates approximately $110 million in stock-based compensation.
Shares of Opendoor Technologies Inc. NASDAQ:OPEN dropped 5.1% to $3.91 as of 11:09 a.m. EDT. The stock retreated after a quarter that posted improved unit economics but saw an increase in stock-based compensation.
The composition is important as management aims for profitability on an adjusted net income basis. The target applies to the 12-month outlook as of the end of the year. Opendoor’s adjusted metric omits stock-based compensation along with a number of additional expenses.
Stock-based compensation for the second quarter reached $119 million, representing 13.5% of revenue and amounting to 2.3 times the contribution profit. Of this, $100 million came from market-condition awards.
The operational comparison indicates a rapid sequential recovery, though yearly performance remains softer. The figures from the company are unaudited.
| Metric | Q2 2026 | Q1 2026 | Q2 2025 | Q2 change |
|---|---|---|---|---|
| Revenue | $883 mln | $720 mln | $1.567 bln | up 23% from previous quarter; down 44% year-on-year |
| Contribution profit | $51 mln | $32 mln | $69 mln | up 59% quarter-on-quarter; down 26% year-on-year |
| Contribution margin | 5.8% | 4.4% | 4.4% | rise of 140 basis points over both periods |
| Adjusted EBITDA | -$4 mln | -$31 mln | $23 mln | $27 mln improvement versus prior quarter |
| GAAP net loss | -$162 mln | -$173 mln | -$29 mln | $133 mln lower than prior year |
| Homes purchased | 4,378 | 2,474 | 1,757 | increase of 77% from last quarter; up 149% from prior year |
| Homes sold | 2,339 | 1,921 | 4,299 | 22% above last quarter; down 46% year-on-year |
| Homes in inventory | 5,459 | 3,420 | 4,538 | 60% higher than previous quarter; up 20% compared to last year |
Acquisition costs dropped significantly. Opendoor secured 6,908 contracts from $5 million spent on marketing, translating to roughly $724 for each contract. The operations expense for each acquisition close decreased to $3,000, down from $8,400 the previous year.
The bridge for common shareholders continues to be less advantageous. Weighted-average shares increased by 32.4% compared to the previous year. At June 30, unamortized stock-compensation expenses totaled $655 million.
| Shareholder measure | Q2 2026 or June 30 reading | Comparison |
|---|---|---|
| GAAP net loss | $162 mln | $30 mln adjusted net loss |
| Total stock compensation | $119 mln | 2.3 times contribution profit |
| Market-condition award expense | $100 mln | 84% of total stock compensation |
| Unamortized market-award cost | $551 mln | Recognition period about 2.1 years |
| Other unamortized RSU cost | $104 mln | Recognition period about 2.3 years |
| Unvested market-condition RSUs | 103.5 mln | 10.7% of July 28 shares |
| Weighted-average shares | 965.8 mln | Up 32.4% year over year |
The 103.5 million units referenced are not guaranteed shares, as no associated market conditions were met by June 30. However, the figure highlights the magnitude of awards tied to upcoming accounting costs.
Chief Executive Kaz Nejatian supported the trajectory toward profitability. “As things stand right now, Opendoor will become ANI profitable. It’s just math,” he stated. The goal pertains to adjusted net income, rather than GAAP earnings. Investing.com UK
Initial estimates: Using management’s Q3 outlook with previous year data indicates a robust minimum for revenue. Equity compensation would continue to outpace the suggested contribution profit.
| Q3 metric | Company outlook | Initial conclusion |
|---|---|---|
| Revenue expansion | Minimum 20% YoY | No less than $1.098 bln |
| Quarter-over-quarter revenue rise | Unstated | No less than 24.3% |
| Contribution earnings | Above double YoY | Over $40 mln |
| Contribution rate | Roughly 4.0%-4.5% | $43.9-$49.4 mln at lowest revenue |
| Equity compensation | Around $110 mln | 2.2-2.5 times suggested contribution earnings |
The expansion further demands additional working capital. In Q2, purchases outpaced sales by 2,039 homes. Inventory climbed by $706 million from the previous quarter to stand at $1.85 billion. Operating cash usage for the first half totaled $964 million, primarily due to increased inventory. Financing activities contributed $639 million.
Deutsche Bank lowered its target following the report and kept a Hold rating. Additional confirmed recommendations indicate a broad range of valuations. The dates shown below indicate the most recent action identified for each company.
| Research firm | Latest verified action | Recommendation | Price target |
|---|---|---|---|
| Deutsche Bank AG NYSE:DB | Aug. 5, 2026 | Hold | $4.25 |
| Keefe, Bruyette & Woods | July 13, 2026 | Underperform | $2.65 |
| Morgan Stanley NYSE:MS | May 8, 2026 | Hold | $5.50 |
| Alliance Global Partners | April 28, 2026 | Buy | $8.00 |
| JPMorgan Chase & Co. NYSE:JPM | Feb. 20, 2026 | Overweight | $8.00 |
| UBS Group AG NYSE:UBS | Feb. 9, 2026 | Neutral | $5.00 |
Trading in housing-technology shares showed mixed performance. Offerpad Solutions Inc. NYSE:OPAD dropped 4.5% to $4.75, while Zillow Group Inc. NASDAQ:Z rose 0.6% to $36.50.
Risks: Opendoor is entering a period of typically lower margins with a larger inventory of homes. A decline in sales pace may lead to increased holding expenses and greater funding requirements. In addition, stock-based compensation could result in dilution if vesting criteria are fulfilled.
Q3 results will indicate if the inventory increase leads to profitable sales. Growth in contracts on its own will not resolve the issue. Contribution profit, cash consumption and the number of shares outstanding will be more significant factors.
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