Opendoor Technologies Inc.

Current report

We utilize a significant amount of debt and financing arrangements in the operation of our business. Our cash flows and operating results could be adversely affected by required payments of debt or related interest and other risks of our debt financing.

Current report

As of June 30, 2025, we had approximately $1.8 billion of non-recourse asset-backed loans. Our leverage could have meaningful consequences to us, including increasing our vulnerability to economic downturns, limiting our ability to withstand competitive pressures, or reducing our flexibility to respond to changing business and economic conditions. We are also subject to general risks associated with debt financing, including (1) our cash flow may not be sufficient to satisfy required payments of principal and interest; (2) we may not be able to refinance our existing indebtedness or refinancing terms may be less favorable to us than the terms of our existing debt; (3) debt service obligations or facility prepayments could reduce funds available for capital investment and general corporate purposes; and (4) any default on our indebtedness could result in acceleration of the indebtedness and foreclosure on the homes collateralizing that indebtedness, with our attendant loss of any prospective income and equity value from such property. Any of these risks could place strains on our cash flows, reduce our ability to grow, and adversely affect our results of operations.

Current report

If the holders of our 0.25% convertible senior notes due 2026 (the “2026 Notes”) or our 7.00% convertible senior notes due 2030 (the “2030 Notes” and together with the 2026 Notes, the “Convertible Senior Notes”) become entitled to convert the Convertible Senior Notes pursuant to the related indenture and one or more holders elect to convert their applicable Notes, we would be required to elect to settle either all or a portion of our conversion obligation in cash, which could adversely affect our liquidity. In addition, even if holders do not elect to convert their Convertible Senior Notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the Convertible Senior Notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.

Current report

We may not have the ability to raise the funds necessary for cash settlement upon conversion of the Convertible Senior Notes or to repurchase the Convertible Senior Notes for cash following a fundamental change or, in respect of the 2030 Notes, to repurchase the 2030 Notes if the holders of the 2030 Notes require so on May 15, 2028, and our future debt may contain limitations on our ability to pay cash upon conversion of the Convertible Senior Notes or to repurchase the Convertible Senior Notes.

Current report

Subject to limited exceptions, holders of the Convertible Senior Notes have the right to require us to repurchase their Convertible Senior Notes upon the occurrence of a fundamental change at a cash repurchase price generally equal to 100% of the principal amount of the Convertible Senior Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. Further, holders of the 2030 Notes have the right to require us to repurchase all or part of their 2030 Notes on May 15, 2028. In addition, upon conversion of the Convertible Senior Notes, we will be required to settle the Convertible Senior Notes being converted partially or entirely in cash. However, we may not have enough available cash or be able to obtain financing at the time we are required to make repurchases of Convertible Senior Notes surrendered therefor or pay the cash amounts due upon conversion. In addition, our ability to repurchase the Convertible Senior Notes or to pay cash upon conversions of the Convertible Senior Notes may be limited by applicable law, by regulatory authorities or by agreements governing our future indebtedness. Our failure to repurchase the Convertible Senior Notes at a time when such repurchase is required by the indenture governing the Convertible Senior Notes or to pay the cash amounts due upon future conversions of the Convertible Senior Notes as required by such indenture would constitute a default under such indenture. A default under the indenture governing the Convertible Senior Notes or the fundamental change itself may also lead to a default under agreements governing our existing or future indebtedness, which may result in such existing or future indebtedness becoming immediately payable in full. We may not have sufficient funds to satisfy all amounts due under such existing or future indebtedness and repurchase the Convertible Senior Notes or make cash payments upon conversions thereof.

Current report

The accounting method for reflecting the Convertible Senior Notes on our balance sheet, accruing interest expense for the Convertible Senior Notes and reflecting the underlying shares of our common stock in our reported diluted earnings per share may adversely affect our reported earnings and financial condition.

Current report

In August 2020, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which, among other things, simplifies the accounting for certain convertible instruments. We early adopted the provisions of ASU 2020-06 effective January 1, 2021.

Current report

In accordance with ASU 2020-06, the Convertible Senior Notes are reflected as a liability on our consolidated balance sheets, with the initial carrying amount equal to the principal amount of the Convertible Senior Notes, net of any debt discount and debt issuance costs. The issuance costs were treated as a debt discount for accounting purposes, which will be amortized into interest expense over the term of the Convertible Senior Notes. As a result of this amortization, the interest expense that we expect to recognize for the Convertible Senior Notes for accounting purposes will be greater than the cash interest payments we will pay on the Convertible Senior Notes, which will result in lower reported earnings.

Current report

In addition, the shares underlying the Convertible Senior Notes are reflected in our diluted earnings per share using the “if-converted” method. Under that method, if the conversion value of the Convertible Senior Notes exceeds their principal amount for a reporting period, then we calculate our diluted earnings per share assuming that all of the Convertible Senior Notes were converted at the beginning of the reporting period and that we issued shares of our common stock to settle the excess. However, if reflecting the Convertible Senior Notes in diluted earnings per share in this manner is anti-dilutive, or if the conversion value of the Convertible Senior Notes does not exceed their principal amount for a reporting period, then the shares underlying the Convertible Senior Notes are not reflected in our diluted earnings per share. The application of the if-converted method may reduce our reported diluted earnings per share, and accounting standards may change in the future in a manner that may adversely affect our diluted earnings per share.

Current report

We may be unable to satisfy a continued listing rule of Nasdaq.

Current report

We are required to meet the continued listing requirements of the Nasdaq Global Select Market and other Nasdaq rules, including those regarding director independence and independent committee requirements, minimum stockholders’ equity, minimum share price and certain other corporate governance requirements. In particular, we are required to maintain a minimum bid price for our listed common stock of $1.00 per share. If we do not meet these continued listing requirements, our common stock could be delisted. On May 28, 2025, we received a letter from The Nasdaq Stock Market LLC indicating that, for the last thirty consecutive business days, the bid price for our common stock had closed below the minimum $1.00 per share requirement for continued listing on The Nasdaq Global Select Market under Nasdaq Listing Rule 5450(a)(1) (the “Bid Price Rule”). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we were provided an initial period of 180 calendar days, or until November 24, 2025, to regain compliance. On July 31, 2025, we received a letter from Nasdaq confirming that we had regained compliance with the Bid Price Rule. The notification letter confirmed that, from July 15, 2025 to July 30, 2025, our minimum bid price had been $1.00 per share or higher and, accordingly, we had regained compliance with Nasdaq Listing Rule 5450(a)(1) and that the matter was now closed.

Current report

However, if our common stock again closes below the $1.00 per share minimum bid price required by Nasdaq for 30 consecutive business days, we would receive another notice of non-compliance with Nasdaq's listing standards and may be provided a period of 180 calendar days from the date of such notice to regain compliance with the Bid Price Rule. However, there can be no assurance that our common stock will continue to close at or above the $1.00 per share minimum bid price as required by Nasdaq, or that we will otherwise meet the requirements of Nasdaq for continued inclusion for listing on The Nasdaq Global Select Market.

Current report

If we are unable to remain listed on Nasdaq or another national securities exchange, we and our stockholders could face significant material adverse consequences, including limited availability of market quotations and analyst coverage for our common stock, and reduced liquidity for the trading of our securities. Additionally, any efforts to regain compliance with Nasdaq's listing standards in the future may result in increased expenses and our management and other personnel needing to devote significant time to the process.

Current report

The price of our common stock has been and may in the future be volatile.

Current report

The price of our common stock has fluctuated and may fluctuate in the future due to a variety of factors, including:

Current report

•developments involving our competitors;

Current report

•changes in financial estimates and recommendations by securities analysts;

Current report

•issuances of shares of our common stock upon conversion of our Notes;

Current report

•short sellers manipulating our stock, resulting in a price decrease;

Current report

•"short squeezes" and “meme” trading of our common stock or the common equity of companies in our industry;

Current report

•our business being subject to seasonality with greater demand and home price appreciation from home buyers in the spring and summer, and typically weaker demand and lower home price appreciation in late fall and winter;

Current report

•actions by stockholders, including the sale of their shares of our common stock;

Current report

•additions and departures of key personnel;

Current report

•commencement of, or involvement in, litigation involving our Company;

Current report

•the volume of shares of our common stock available for public sale; and

Current report

•general economic and political conditions, such as interest rate increases, including the recent significant increases in 2022 and 2023, higher inflation and decreased consumer confidence, recessions, the future impacts of pandemics or epidemics, local and national elections, fuel prices, international currency fluctuations, corruption, inflation, political instability, and acts of war or terrorism.

Current report

In addition, interest in our common stock from retail and other individual investors, for reasons that are unrelated to our underlying business or macroeconomic or industry fundamentals, could result in increased volatility in the market price of our common stock. For instance, in July 2025, the bid price of our common stock fluctuated between a low of $0.5267 and a high of $4.97, with significant increases in volume over our typical daily trading volume. The recent market volatility and trading patterns we have experienced may be related to, among other factors, strong and atypical retail investor interest, including on social media and online forums, and create several risks for investors, including the following:

Current report

•the market price of our common stock has experienced and may continue to experience rapid and substantial increases or decreases that are unrelated to our operating performance, macro or industry fundamentals, and substantial increases may be inconsistent with the risks and uncertainties that we continue to face;

Current report

•factors in the public trading market for our common stock may include the sentiment of retail investors (including as may be expressed on financial trading and other social media sites and online forums), the direct access by retail investors to broadly available trading platforms, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock and any related hedging and other trading factors;

Current report

•we have received, and may continue to receive, media coverage that is published or otherwise disseminated by third parties, including blogs, articles, message boards and social and other media, that may not be attributable to the Company and may not be reliable or accurate;

Current report

•to the extent volatility in our common stock is caused by a “short squeeze” in which coordinated trading activity causes a spike in the market price of our common stock as traders with a short position make market purchases to avoid or to mitigate potential losses, investors purchase at inflated prices unrelated to our financial performance or prospects, and may thereafter suffer substantial losses as prices decline once the level of short-covering purchases has abated; and

Current report

•if the market price of our common stock declines, investors may be unable to resell shares of our common stock at or above the price at which their investment was made. Our common stock may continue to fluctuate or decline significantly in the future, which may result in substantial losses.

Current report

Furthermore, the stock markets in recent years have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of the equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political and market conditions such as recessions, changes to federal monetary policy, interest rates or international currency fluctuations, may negatively impact the market price of our common stock. In the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We have in the past been and are currently the target of this type of litigation, and we may continue to be the target of this type of litigation in the future. Past, current, and future securities litigation against us could result in substantial costs and divert management's attention from other business concerns, which could harm our business, results of operations or financial condition. These market and industry factors may materially reduce the market price of our common stock regardless of our operating performance.