By Jonathan Weil

Opendoor Technologies, which became a high-flying meme stock earlier this year, is down sharply Friday after reporting disappointing quarterly results.

The company was the subject of an Oct. 3 Heard on the Street column that flagged a crucial problem for its business model: The economics of the home-flipping business don't scale. Buying and selling homes for resale is both labor- and capital-intensive. Opendoor and other home-flippers have struggled to figure out how to make revenue grow faster than costs.

This problem was visible in Opendoor's quarterly results. Opendoor said it sold more than twice as many homes last quarter as it bought, in an effort to clear out old inventory. Revenue was $915 million, down 34% from a year earlier, while its net loss grew to 15% to $90 million.

Opendoor said it's "driving to adjusted net income breakeven by the end of 2026." But the key word there is "adjusted," signaling that Opendoor won't be profitable using standard metrics.

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November 07, 2025 10:45 ET (15:45 GMT)

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