TLDR
- Opendoor stock dropped 13% Wednesday after weak Q3 guidance disappointed investors
- CEO Carrie Wheeler resigned under activist pressure from Eric Jackson and Anthony Pompliano
- Q2 revenue beat at $1.57B but Q3 outlook of $800-875M missed $1.22B consensus badly
- Analyst downgraded to Underperform with $1 target, slashing future forecasts
- Stock down 34% from highs despite 500% retail-driven rally earlier this year
Opendoor Technologies stock crashed Wednesday, falling as much as 13% as investors fled following disappointing quarterly guidance and recent leadership upheaval.
The real estate technology company’s shares reversed a massive 500% rally that had been driven by retail investors over the past two months. The selloff highlights how quickly sentiment can shift when financial reality meets market hype.
CEO Departure Shakes Leadership
CEO Carrie Wheeler stepped down last week under intense pressure from activist investors Eric Jackson and crypto entrepreneur Anthony Pompliano. The duo had launched a social media campaign that helped fuel Opendoor’s recent surge.
Chief Technology Officer Shrisha Radhakrishna now serves as interim CEO while the board searches for a permanent replacement with Spencer Stuart’s help. Wheeler will remain as an advisor through year-end.
The leadership change came after Wheeler had worked to stabilize the company following heavy losses in 2022.
Mixed Earnings Results
Opendoor’s second-quarter results showed both progress and concerning trends. Revenue of $1.57 billion topped analyst estimates of $1.50 billion, while the company posted a one-cent loss per share that matched forecasts.
The company achieved positive adjusted EBITDA of $23 million, marking its first quarterly profit since 2022. This represented a major turnaround from previous periods of steep losses.
However, the third-quarter outlook crushed investor optimism. Management guided for revenue between $800-875 million, falling far short of the $1.22 billion consensus estimate.
Analyst Downgrades Follow
Keefe, Bruyette & Woods analyst Ryan Tomasello downgraded Opendoor to Underperform with a $1 price target following the results. He slashed his 2025 and 2026 forecasts, now expecting wider losses and deeper EBITDA deficits.
Tomasello noted that management’s revenue outlook came in roughly 40% below analyst expectations. He cited the company’s shift to an agent-led business model as creating additional uncertainty.
The analyst expressed concerns about weakening demand and delayed margin recovery in the real estate market.
Retail Investor Defense
Anthony Pompliano defended Opendoor against critics calling it a meme stock. He described retail investors as a “decentralized hedge fund” that actively engages with companies to drive improvements.
Pompliano pointed to Wheeler’s resignation as evidence of retail investor influence, noting that pressure from individual investors forced out a multi-billion dollar company’s CEO.
Eric Jackson, who led the activist campaign, also rejected meme stock comparisons and called Opendoor “a real business” with genuine potential.
Opendoor stock now trades around $3.22, down 34% from its 52-week high of $4.97. Despite recent declines, shares remain well above the $0.51 yearly low. The stock has gained 333% over the past three months despite Wednesday’s selloff.
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