TLDR
- Opendoor stock surged over 1,000% from $0.51 June lows to current $10 price following leadership overhaul
- Former Shopify COO Kaz Nejatian named new CEO as co-founders Keith Rabois and Eric Wu rejoin board
- Company achieved brief Q2 profitability with $23 million adjusted EBITDA but Q3 guidance shows return to losses
- Stock trades at 20x trailing gross profit despite thin 8.2% margins and no consistent profit history
- Management plans cost cuts and expansion into mortgage, title services beyond core home flipping business
Opendoor Technologies has become 2025’s most dramatic meme stock comeback story. Shares rocketed from $0.51 in June to over $10, delivering gains exceeding 1,000% in just three months.
The rally began when professional investors started buying the beaten-down real estate technology stock. Retail traders quickly joined, creating a social media-fueled buying frenzy.
The company operates a digital platform that purchases homes with cash offers before reselling them. This national-scale home flipping model generates thin margins but requires heavy capital.
Last quarter’s gross margin reached only 8.2% while the business burned cash for years. Revenue and gross profit both dropped 70% from peak levels during the recent housing market slowdown.
New Leadership Drives Investor Optimism
Management changes in September sparked the massive rally. Opendoor ousted previous CEO Carrie Wheeler and brought in Kaz Nejatian from Shopify.
Nejatian previously served as chief operating officer at the successful e-commerce software company. His appointment represents a major shift toward technology-focused leadership.
Co-founders Keith Rabois and Eric Wu also returned to the board of directors. Rabois now serves as chairman while Wu rejoins as a board member.
The leadership team describes this transition as entering “founder mode.” They plan major cost cuts to eliminate what Rabois calls employee bloat across the organization.
Nejatian ended the work-from-home policy to boost innovation. His compensation package ties directly to stock performance through equity-heavy incentives.
Financial Results Show Mixed Progress
Second quarter results revealed both improvements and ongoing challenges. Revenue reached $1.6 billion while the company sold 4,299 homes during the period.
Most importantly, Opendoor achieved $23 million in adjusted EBITDA. This marked the first positive quarter on this metric since 2022.
However, the company spent heavily on operations despite gross profit of only $128 million. Marketing costs hit $86 million while overhead reached $28 million.
Third quarter guidance disappointed investors with projected revenue of $800-875 million. Management expects adjusted EBITDA to return negative in Q3.
High mortgage rates continue suppressing buyer demand across housing markets. The company faces margin pressure from older inventory in its pipeline.
Beyond cost reduction, Opendoor plans expansion into new services. Potential areas include title work, mortgages, and partnerships with real estate agents.
These services could reduce reliance on the capital-intensive core business model. The goal involves creating smoother transaction experiences for buyers and sellers.
At current prices, Opendoor trades at roughly 20 times trailing gross profit. This represents a premium valuation for a company with no consistent profitability track record.
The new leadership team faces high expectations following the massive stock rally and must prove they can generate sustainable profits.
