iBuying platform, Opendoor Technologies Inc. (NASDAQ:OPEN), reported its second-quarter earnings, marking its first quarter of adjusted EBITDA profitability in three years.
Check out the current price of OPEN stock here.
What Happened: During the company’s earnings call on Tuesday, CFO Selim Freiha highlighted its $23 million EBITDA profit, compared to a loss of $5 million last year. Freiha says, “This outcome is an indicator of the meaningful operating leverage we have driven,” while cautioning investors of a tougher second half.
“The housing market has further deteriorated over the course of the last quarter,” he says, placing the blame on persistently high mortgage rates, which continue to suppress buyer demand, and have since led to “lower clearance and record delistings.”
Freiha also says that the company’s contribution margins, or how much the company makes from each transaction, will be compressed between 2.8% and 3.3% during the second half of this year, due to “an unfavorable mix of older, lower margin homes.”
This, he says, will likely put the company’s goal of year-over-year contribution margin improvement “out of reach” for this year.
The company released its second-quarter results on Tuesday, reporting $1.57 billion in revenue, beating consensus estimates of $1.50 billion. Losses were in line with Street estimates at $0.01 per share, but it posted its first adjusted EBITDA profit of $23 million in three years.
Price Action: The stock was up 2.44% on Tuesday, trading at $2.52, but has since plunged 24.6% after hours, following its earnings announcement.
According to Benzinga’s Edge Stock Rankings, Opendoor scores high on Momentum and Value, with a favorable price trend in the short, medium and long term. Click here for deeper insights into the stock, its peers and competitors.
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