Opendoor Technologies Inc.
For the period ended Dec 31, 2025. Filed Feb 19, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 19, 2026
OPEN$1.41+0.7%Stored close · as of Nov 9, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-27.
0001801169-25-000017
ITEM 1A. RISK FACTORSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-19.
0001801169-26-000010
ITEM 1A. RISK FACTORSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 275 previous paragraphs and 319 current paragraphs.
171 unchanged; 94 reworded; 52 added; 7 removed; 3 previous and 2 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (52)
Current report
•consumer hesitancy to spend or take on debt due to economic uncertainty;
Current report
•our inability to grow market share, including those in which we have less operating history;
Current report
•we may incur greater losses as a result of our recent expansion into all contiguous 48 states, where we have less operating history and market penetration;
Current report
Our business has experienced periods of significant contraction, and if we are unable to manage these contractions or adequately scale our business then we may be unable to grow in the future. We also may fail to effectively manage our growth.
Current report
•manage operating expenses, including by leveraging AI to drive operational efficiency;
Current report
•expand our ancillary services offerings, such as mortgage, homeowners’ insurance, and warranty services;
Current report
Furthermore, in order to grow our business, we may need to increase market penetration. Expanding our market penetration may prove to be challenging as currently less than 1% of aggregate home value transacted annually is conducted online. Attempting to grow our market share in our less concentrated markets may result in greater pricing uncertainty, as well as higher capital requirements, hold times, repair costs and transaction costs that may result in certain markets being less profitable for us than those in which we have a longer operating history and more concentrated penetration.
Current report
Our performance and success depends in large part upon the continued service of our senior management team. For instance, Kaz Nejatian is critical to the overall management of the Company and plays an important role in setting our strategic direction, maintaining our culture and executing on our business plan. Our ability to compete effectively and our future success depend on our ability to continue to identify, attract, hire, develop, motivate, and retain a large number of highly skilled personnel across all areas of our organization and our various product lines. Competition in our industry for qualified employees, particularly AI talent, is intense, and certain of our competitors may directly target our employees. For example, much of our key technology and processes are custom-made for our business by our personnel, and the loss of such personnel could significantly impact our ability to maintain and build upon such technology and processes. In addition, our compensation arrangements, such as our equity award programs, may not always be successful in attracting new employees and retaining and motivating our existing employees. Immigration policy and regulatory changes, uncertainty regarding such policies and regulations, and any resulting delays or increased costs for visa applications and immigration processes may also affect our ability to hire, mobilize, or retain some of our personnel, including members of our senior management team, who are from outside the United States, or employ personnel in the locations of our choice. For example, Kaz Nejatian is a Canadian citizen and is currently in the process of obtaining requisite work authorization in the United States.
Current report
Our success also depends in part upon our ability to facilitate successful transitions when management team members pursue other opportunities. In 2025, we undertook several transitions in personnel, including some of our senior management team. For example, in the second half of 2025, we appointed Kaz Nejatian as our Chief Executive Officer, Lucas Matheson as our President and Christy Schwartz as our Chief Financial Officer. While we have confidence in our team, the uncertainty inherent in leadership transitions may be difficult to manage and can disrupt our business. The failure to successfully transition and assimilate key employees generally could adversely affect our results of operations.
Current report
The ability of our mortgage subsidiary to generate revenue through loan sales will depend, in part, on participation in programs administered by government agencies, such as the Federal Housing Administration, the Department of Veterans Affairs, the U.S. Department of Agriculture, and government-sponsored entities (“GSEs”), such as Fannie Mae and Freddie Mac. If any of these agencies or GSEs limit our ability to participate in their programs, or if their operations are eliminated or significantly changed, our mortgage business could be materially adversely affected. A number of legislative proposals have been introduced in recent years that would wind down or phase out the GSEs, and uncertainty remains regarding their future roles.
Current report
In addition, as a result of the revised NAR rules and practices and otherwise, our competitors and other real estate market participants may engage in conduct that limits our ability to effectively compete, such as by restricting access to proprietary listing data, or by putting homes for sale on a private listing network, or otherwise using a non-MLS platform or mechanism to facilitate the buying and selling of homes instead of publicly through the MLS. Another industry participant or group could create a new listings data service, which could adversely impact our ability to buy and sell homes. Changes to our rights to use or timely access listing data, or changes to the way real estate information is shared, could also adversely impact our ability to buy and sell homes, which in turn may materially impact our business, financial condition, and results of operations.
Current report
Our mortgage business could fail to achieve expected results, may expose us to greater risk and obligations, and could cause harm to our financial results, operations, and reputation.
Current report
We operate our mortgage business through our wholly-owned mortgage subsidiary. To grow our mortgage business, we expect that such entity will depend, in part, on having access to sufficient capital. If it does not have sufficient cash on hand, it would not be able to fund new loans. If our wholly-owned mortgage subsidiary is unable to form or retain relationships with third-party financial institutions to purchase its loans or to comply with any covenants in its agreements with these institutions, it may be unable to sell its loans on favorable terms or at all. All of the foregoing could cause harm to our financial results, operations, and reputation.
Current report
Additionally, we expect that substantially all mortgage loans we originate will be sold into the secondary market. The gain recognized from such sales will represent a significant portion of our mortgage-related revenue. Demand in the secondary market and our ability to complete the sale or securitization of mortgage loans depends on factors beyond our control, including general economic conditions, conditions in the banking system, and the willingness of investors to purchase mortgage loans and mortgage-backed securities. If it is not possible or economical for us to complete such sales, our revenues and margins on new loan originations could be materially and negatively impacted.
Current report
When we sell mortgage loans, we make representations and warranties to purchasers and insurers regarding loan quality, compliance with origination guidelines, and adherence to applicable laws. These representations and warranties typically remain in place for the life of the loan. In the event of a breach, we may be required to repurchase the mortgage loan or indemnify the purchaser, and any subsequent loss may be borne by us.
Current report
In the United States, the regulatory framework for AI Technologies faces significant uncertainty. At the federal level, Congress has yet to enact meaningful AI legislation. Instead, federal policy on AI has been shaped by a series of executive orders that have shifted priorities and requirements substantially depending on the administration in power. In October 2023, President Biden issued an Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence, which emphasized AI safety and security and addressed topics such as civil rights, privacy, consumer protection, and accountable federal use of AI. In January and July 2025, President Trump issued three executive orders on AI, one of which repealed President Biden’s 2023 Executive Order, shifting the focus towards removing regulatory barriers to the adoption of AI Technologies and accelerating AI deployment.
Current report
In the absence of federal AI legislation, states have filled the void by enacting laws regulating different aspects of AI Technologies. For example, California has enacted laws and regulations related to AI safety protocols and reporting and transparency, among other AI-related topics. In addition, Colorado’s Artificial Intelligence Act will require developers and deployers of “high-risk” AI systems to implement certain safeguards against algorithmic discrimination (among other requirements), and the Texas Responsible Artificial Intelligence Governance Act prohibits the development and deployment of AI systems for certain purposes while establishing a regulatory sandbox. Moreover, state AI laws like Colorado’s Artificial Intelligence Act and various state privacy laws, including the CCPA, regulate the use of automated decision making technology, particularly when it results in legal or similarly significant effects on individuals, and provide rights to individuals with respect to such technology.
Current report
Numerous other states have enacted, passed, or are considering AI-focused legislation, creating a patchwork of regulations and a complex compliance challenge. However, the durability of these laws and the potential of additional state- level legislative activity faces uncertainty following President Trump’s December 2025 Executive Order “Ensuring a National Policy Framework for Artificial Intelligence.” This Executive Order establishes a federal policy favoring a uniform national AI regulatory framework designed to promote innovation and U.S. global competitiveness. The order directs federal agencies to identify, challenge, and potentially preempt state and local AI laws that are viewed as inconsistent with or burdensome to this national approach. It remains to be seen how agencies will effectuate this directive, and how states will approach AI legislation moving forward. Any or all of the foregoing regulatory developments could materially adversely affect our business, results of operations, and financial condition. Further, any failure or perceived failure by us to comply with existing or newly enacted laws, regulations and other requirements relating to AI Technologies could result in legal claims or proceedings (including class actions), regulatory investigations or enforcement actions.
Current report
For example, members of Congress and lawmaking bodies in several different states have proposed, and, in some cases enacted, legislation intended to disincentivize or restrict certain business entities, pooled investment funds, and institutional purchasers from acquiring, owning, or, in some cases, obtaining an interest in, single-family residential real estate. These laws and proposals generally attempt to prohibit or discourage restricted entities from purchasing residential real estate, and/or establish a maximum allowable number of single-family residential homes that can be purchased or held in inventory by certain specified types of entities. Some of these proposals would establish statutory penalties for violations, while others attempt to establish significant tax penalties to be levied upon (or attempt to limit or eliminate certain tax deductions or benefits for) specified purchasers and owners of single-family residential homes.
Current report
Additionally, in January 2026, President Trump issued an executive order directing federal agencies to prevent agencies and government-sponsored enterprises from facilitating the acquisition by “large institutional investors” of “single-family homes” in the United States that could otherwise be purchased by individual owner-occupants. The order directs the Secretary of the Treasury to develop definitions of “large institutional investor” and “single-family home” and calls on Congress to enact legislation codifying these restrictions. Additionally, the order requires owners of single-family rentals participating in federal housing assistance programs to disclose direct or indirect ownership interests to determine involvement of large institutional investors.
Current report
The order also directs the Attorney General and the Federal Trade Commission to review substantial acquisitions by large institutional investors of single-family homes for anti-competitive effects and to prioritize enforcement of antitrust laws against coordinated vacancy and pricing strategies. If our home acquisition activities attract antitrust scrutiny under this directive, we could be subject to investigations, enforcement actions, or restrictions that could materially impact our business operations and strategic initiatives.
Current report
Such changes in the law could have broad consequences on participants in the mortgage and general real estate industries. Such consequences could include, without limitation, restricting single-family rental owners and/or operators from acquiring or owning single-family residential properties, forced divestiture of single-family real estate already owned, restricting entities from holding security interests in single-family real estate, restricting parties from taking ownership of single-family real estate through foreclosure of a security interest, decreasing or barring certain tax deductions for certain purchasers or owners of single-family real estate or levying substantial taxes or penalties on these and other activities. Depending on the individual law, restricted parties could be read to include certain issuers of mortgage-backed securities and other pooled investment entities. While we do not expect Opendoor to be classified as a “large institutional investor” under the pending definitions, the scope of such definitions remains uncertain. If Opendoor is included within the definition of “large institutional investor” or another restricted entity, these restrictions could have a significant adverse impact on our ability to buy and sell homes, access GSE programs for financing or securitization purposes, or participate in federal housing programs. Additionally, certain of these proposals may cause originators of residential consumer loans to curtail or potentially cease originating and selling loans collateralized by properties in specific states, which could have an adverse effect on our mortgage business. These and other potential consequences could materially and adversely impact our business, financial condition, and results of operations.
Current report
Mortgage products are regulated at the state level by licensing authorities and administrative agencies, with additional oversight from the CFPB and other federal agencies. These laws generally regulate the manner in which lending and lending-related activities, including mortgage brokering, are marketed or made available to consumers, including, but not limited to, advertising, finding and qualifying applicants, the provision of consumer disclosures, payments for services, and record keeping requirements; these laws include, at the federal level, RESPA, the Fair Credit Reporting Act (as amended by the Fair and Accurate Credit Transactions Act), the Truth in Lending Act (including the Home Ownership and Equity Protection Act of 1994), the Equal Credit Opportunity Act, the Fair Housing Act, the GLBA, the Electronic Fund Transfer Act, the Servicemembers Civil Relief Act, the Military Lending Act, the Homeowners Protection Act, the Home Mortgage Disclosure Act, the Secure and Fair Enforcement for Mortgage Licensing Act of 2008, the Federal Trade Commission Act, the Dodd Frank Wall Street Reform and Consumer Protection Act of 2010, the Bank Secrecy Act (including the Office of Foreign Assets Control and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act), the TCPA, the Mortgage Acts and Practices Advertising Rule (Regulation N), all implementing regulations, and various other federal laws.
Current report
The CFPB also has broad authority to regulate mortgage origination activities and enforce prohibitions on practices that it deems to be unfair, deceptive or abusive. The growing regulatory focus on AI/automated underwriting, digital mortgage platforms, property valuation models, and fair lending may require us to adapt our business practices and could affect our ability to maintain compliance. Heightened uncertainty exists with respect to the future of the CFPB, including its leadership and enforcement priorities. Additionally, state and local laws may restrict the amount and nature of interest and fees that may be charged by a lender or mortgage broker, impose more stringent privacy requirements and protections for servicemembers, and/or otherwise regulate the manner in which lenders or mortgage brokers operate or advertise. We cannot predict the specific legislative or executive actions that may result or what impact such changes may have on our mortgage operations.
Current report
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”) have the right to convert their Convertible Senior Notes:
Current report
•during any calendar quarter, if the last reported sale price of our common stock exceeds 130% of the conversion price for each of at least twenty business days (whether or not consecutive) during the thirty consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;
Current report
•during the five consecutive business day period after any 10 consecutive trading day period if the trading price per $1,000 principal amount of the applicable Convertible Senior Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate of the notes on each such trading day;
Current report
•upon the occurrence of specified corporate events; and
Current report
•if we call any or all of the Convertible Senior Notes for redemption, at any time prior to the close of business on the scheduled trading day prior to the redemption date.
Current report
The price of our common stock and Warrants (as defined herein) have been and may in the future be volatile.
Current report
•publication of research reports by securities analysts or other third parties about us or our competitors or our industry, which may be inaccurate or unfavorable;
Current report
•“short squeezes” and “meme” trading of our common stock or the common equity of companies in our industry;
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 and Warrants have 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 securities 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 securities declines, investors may be unable to resell shares of our common stock at or above the price at which their investment was made. Our securities may continue to fluctuate or decline significantly in the future, which may result in substantial losses.
Current report
In addition, if the closing price of our common stock remains below $1.00 for 30 consecutive trading days, we have in the past and may in the future receive a notice from Nasdaq indicating that we are not in compliance with Nasdaq’s minimum bid price rule. 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. 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. These market and industry factors may materially reduce the market price of our securities regardless of our operating performance.
Showing the first 40 of 52 passages. Open the source sections for the rest.
Removed paragraphs (7)
Previous report
•our inability to grow market share in our existing markets or any new markets we may enter;
Previous report
•our expansion into new markets, for which we typically incur more significant losses immediately following entry;
Previous report
While we have experienced rapid growth historically, our business experienced significant contraction in the second half of 2022, which continued throughout 2023 and into the first half of 2024. If we are unable to correct this contraction, or adequately scale our operations, we may be unable to grow in the future.
Previous report
Furthermore, in order to grow our business, we may need to expand into new markets. Expanding into new markets may prove to be challenging as some markets may have very different characteristics than the markets we currently operate in, some of which may be unanticipated or unknown to us. These differences may result in greater pricing uncertainty, as well as higher capital requirements, hold times, repair costs and transaction costs that may result in those markets being less profitable for us than those that we currently operate in. For instance, during 2023, we stopped acquiring inventory in, and operationally supporting, our markets in Boise, Idaho, Reno, Nevada, and Asheville, North Carolina, because these markets were below the scale required for us to operate in a cost-effective manner and not sufficiently close to another market to leverage its operations.
Previous report
U.S. regulators are applying existing authority to adopt laws and regulations and take other actions with respect to AI Technologies, including the risks described above. For example, the current U.S. presidential administration has rescinded an executive order relating to the safe and secure development of AI Technologies that was implemented by the previous administration. The current administration then issued a new executive order that, among other things, requires certain agencies to develop and submit to the President action plans to “sustain and enhance America’s global AI dominance,” and to specifically review and, if possible, rescind rulemaking taken pursuant to the rescinded executive order. Thus, the current administration may continue to rescind other existing federal orders and/or administrative policies relating to AI Technologies, or may implement new executive orders and/or other rule making relating to AI Technologies in the future. Any such changes at the federal level could require us to expend significant resources to modify our products, services, or operations to ensure compliance or remain competitive. Legislation related to AI Technologies has also been introduced at the federal level and is advancing at the state level. For example, the California Privacy Protection Agency is currently in the process of finalizing regulations under the CCPA regarding the use of automated decision-making. Such additional regulations may impact our ability to develop, use and commercialize AI Technologies in the future. California also enacted seventeen new laws in 2024 that further regulate use of AI Technologies and provide consumers with additional protections around companies’ use of AI Technologies, such as requiring companies to disclose certain uses of generative AI. Other states have also passed AI-focused legislation, such as Colorado’s Artificial Intelligence Act, which will require developers and deployers of “high-risk” AI systems to implement certain safeguards against algorithmic discrimination, and Utah’s Artificial Intelligence Policy Act, which establishes disclosure requirements and accountability measures for the use of generative AI in certain consumer interactions. Such additional regulations may impact our ability to develop, use, procure and commercialize AI Technologies in the future. While new AI Technologies initiatives, laws, and regulations are emerging and evolving, what they ultimately will look like remains uncertain, and our obligation to comply with them could entail significant costs, negatively affect our business, or entirely limit our ability to incorporate certain AI Technologies into our offerings.
Reworded paragraphs (94)
Previous wording
In the course of conducting our business operations, we are exposed to a variety of risks. You should carefully consider the risks described below, as well as the other information in this Annual Report on Form 10-K, including our financial statements and the related notes and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” before deciding whether to invest in our common stock. Any of the risk factors we describe below have affected or could materially and adversely affect our business, financial condition, results of operations and prospects. The market price of shares of our common stock could decline, possibly significantly or permanently, if one or more of these risks and uncertainties occurs. Certain statements in “Risk Factors” are forward-looking statements. See “Forward-Looking Statements.”
Current wording
In the course of conducting our business operations, we are exposed to a variety of risks. You should carefully consider the risks described below, as well as the other information in this Annual Report on Form 10-K, including our financial statements and related notes and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” before deciding whether to invest in our common stock. Any of the risk factors we describe below have affected or could materially and adversely affect our business, financial condition, results of operations and prospects. The market price of shares of our common stock could decline, possibly significantly or permanently, if one or more of these risks and uncertainties occurs. Certain statements in “Risk Factors” are forward-looking statements. See “Forward-Looking Statements.”
Previous wording
•federal, state, or local legislative or regulatory changes that would negatively impact owners or potential purchasers of single-family homes or the residential real estate industry in general, such as the Tax Cuts and Jobs Act of 2017, which limited deductions of certain mortgage interest expenses and property taxes; or
Current wording
•federal, state, or local legislative or regulatory changes that would negatively impact owners or potential purchasers of single-family homes or the residential real estate industry in general, such as the recently enacted One Big Beautiful Bill Act (“OBBBA”), which made permanent the limitation on deductions of certain mortgage interest expenses; or
Previous wording
We have incurred net losses on an annual basis since we were founded. We incurred net losses of $392 million, $275 million, and $1.4 billion for the years ended December 31, 2024, 2023, and 2022, respectively. We had an accumulated deficit of $3.7 billion and $3.3 billion as of December 31, 2024 and 2023, respectively. In the longer term, we expect to make future investments in developing and expanding our business, including technology, recruitment and training, marketing and pursuing strategic opportunities. These investments may not result in increased revenue or growth in our business. Additionally, we may incur significant losses in the future for a number of reasons, including the following:
Current wording
We have incurred net losses on an annual basis since we were founded. We incurred net losses of $1.3 billion, $392 million, and $275 million for the years ended December 31, 2025, 2024, and 2023, respectively. We had an accumulated deficit of $5.0 billion and $3.7 billion as of December 31, 2025 and 2024, respectively. In the longer term, we expect to make future investments in developing and expanding our business, including technology, recruitment and training, marketing and pursuing strategic opportunities. These investments may not result in increased revenue or growth in our business. Additionally, we may incur significant losses in the future for a number of reasons, including the following:
Previous wording
•our failure to realize anticipated efficiencies through our technology, business model and cost management strategies;
Current wording
•our failure to realize anticipated efficiencies through our leveraging of AI, technology, business model and cost management strategies;
Previous wording
•costs associated with enhancements of our products and introducing new product offerings;
Current wording
•costs associated with enhancements of our products and introducing new product offerings, including costs to enhance engineering and AI capabilities;
Current wording
•our failure to execute our growth strategies, including our failure to successfully improve the customer experience and/or our unit economics by expanding core services and ancillary services, such as mortgage, homeowners’ insurance, and warranty services;
Previous wording
•loss in value of real estate due to changes in market conditions in the area in which real estate or assets are located;
Current wording
•loss in value of real estate due to changes in market conditions in the areas in which real estate or assets are located;
Previous wording
Our business model and technology is still nascent compared to the business models of the incumbents in the U.S. residential real estate industry. We launched our first market in 2014 and do not have a long operating history. Our operating results are not predictable and our historical results may not be indicative of our future results. Few peer companies exist and none have yet established long-term track records that might assist us in predicting whether our business model and strategy can be implemented and sustained over an extended period of time. It may be difficult for you to evaluate our potential future performance without the benefit of established long-term track records from companies implementing a similar business model. We may encounter unanticipated problems as we continue to refine our business model and may be forced to make significant changes to our anticipated sales and revenue models to compete with our competitors’ offerings, which may adversely affect our results of operations and profitability.
Current wording
Our business model and technology are still nascent compared to the business models of the incumbents in the U.S. residential real estate industry. We launched our first market in 2014 and do not have a long operating history. Our operating results are not predictable and our historical results may not be indicative of our future results. Few peer companies exist and none have yet established long-term track records that might assist us in predicting whether our business model and strategy can be implemented and sustained over an extended period of time. It may be difficult for you to evaluate our potential future performance without the benefit of established long-term track records from companies implementing a similar business model. We may encounter unanticipated problems as we continue to refine our business model and may be forced to make significant changes to our anticipated sales and revenue models to compete with our competitors’ offerings, which may adversely affect our results of operations and profitability.
Previous wording
•our continued ability to develop and improve our technology to support our business model;
Current wording
•our continued ability to develop and improve our technology to support our business model, including our ability to leverage AI to drive operational efficiency and improve the customer experience;
Previous wording
Our business model depends on our ability to continue to attract customers to our digital platform and the products we offer and to enhance customers’ engagement with our products in a cost-effective manner. New entrants may continue to join our market categories. Our existing and potential competitors include companies that operate, or could develop, national and/or local real estate businesses offering services to home buyers or sellers, including real estate brokerage services, title insurance, and escrow services.
Current wording
Our business model depends on our ability to continue to attract customers to our digital platform and the products we offer and to enhance customers’ engagement with our products in a cost-effective manner. New entrants may continue to join our market categories. Our existing and potential competitors include companies that operate, or could develop, national and/or local real estate businesses offering services to home buyers or sellers, including real estate brokerage services, mortgage services, title insurance, and escrow services.
Previous wording
Some of our competitors may have well-established national reputations and may market similar products and services. These companies may be larger than us and have significant competitive advantages, including better name recognition, greater resources, greater technological capabilities, longer operating histories, more industry experience, lower cost of funds and additional access to capital, and a broader set of offerings than we currently do. These companies may also have higher risk tolerances or different risk assessments than we do. In addition, these competitors could devote greater financial, technical and other resources than we have available to develop, grow or improve their businesses. Any of our current or future competitors could merge with each other or a separate entity, which may enable them to compete with us even more vigorously and acquire a greater share of real estate transactions. If we are not able to continue to attract customers to our platform and products, our business, results of operations and financial condition could be harmed.
Current wording
Some of our competitors may have well-established national reputations and may market similar products and services. These companies may be larger than us and have significant competitive advantages, including better name recognition, greater resources, greater technological capabilities, including a more successful integration of AI features, longer operating histories, more industry experience, lower cost of funds and additional access to capital, and a broader set of offerings than we currently do. These companies may also have higher risk tolerances or different risk assessments than we do. In addition, these competitors could devote greater financial, technical and other resources than we have available to develop, grow or improve their businesses. Any of our current or future competitors could merge with each other or a separate entity, which may enable them to compete with us even more vigorously and acquire a greater share of real estate transactions. If we are not able to continue to attract customers to our platform and products, our business, results of operations and financial condition could be harmed.
Previous wording
While we experienced rapid growth historically, our business contracted in the second half of 2022, which continued throughout 2023 and into the first half of 2024 as we focused on selling down our old book inventory, which is comprised of homes purchased before July 1, 2022. We may not be able to reverse such contraction and grow our business in the future if we do not, among other things:
Current wording
While we experienced growth historically, our business has experienced periods of significant contraction. For example, our business contracted significantly in the second half of 2022, which continued throughout 2023 and into the first half of 2024. During this period, we focused on selling down our old book inventory, which was composed of homes purchased before July 1, 2022. We also experienced contraction of our business in the second half of 2025, due in part to low inventory levels as a result of reduced acquisition volumes. We may not be able to reverse or manage this or any future contraction and grow our business in the future if we do not, among other things:
Previous wording
•continue to increase the number of customers using our platform;
Current wording
•continue to increase the number of customers using our platform, including through leveraging AI to enhance our technology and improve the customer experience;
Previous wording
•increase our market share within existing markets and expand into new markets;
Previous wording
We assess and price the homes we buy and sell using data science, proprietary algorithms, and analysis from specially trained employees, incorporating a number of factors, including our knowledge of the real estate markets in which we operate. This assessment includes estimates regarding time of possession, seasonality, macroeconomic and local market conditions, renovation costs and holding costs, transaction costs, and anticipated resale proceeds. Our ability to acquire and resell homes profitably may be negatively impacted if our models lack robust historical data on home sales, material home features, or other market nuances, especially those outside of features and nuances we have previously encountered and modeled in our existing 50 markets, or if our assumptions underlying our models are otherwise not accurate. In addition, while changing market conditions are reflected in our pricing for new acquisitions, our previously-acquired inventory and homes under contract to be acquired may be at risk for potential market volatility. These factors, in turn, could negatively impact our revenue growth if resulting valuations are too low and/or fees are too high, or our profitability, if valuations are too high and/or fees are too low. In addition, inaccuracies in our models could result in us acquiring too many or too few properties to maximize profitability.
Current wording
We assess and price the homes we buy and sell using data science, proprietary algorithms, AI, and analysis from specially trained employees, incorporating a number of factors, including our knowledge of the real estate markets in which we operate. This assessment includes estimates regarding time of possession, seasonality, macroeconomic and local market conditions, renovation costs and holding costs, transaction costs, and anticipated resale proceeds. Our ability to acquire and resell homes profitably may be negatively impacted if our models lack robust historical data on home sales, material home features, or other market nuances, especially those outside of features and nuances we have previously encountered and modeled in our more concentrated markets, or if our assumptions underlying our models are otherwise not accurate. Moreover, the models underlying our AI technologies may be incorrectly designed or implemented or exhibit defects, such as if the data on which our AI technologies are trained is incomplete, inadequate, inaccurate, biased or otherwise of poor-quality, which could result in ineffective or inaccurate outputs. In addition, while changing market conditions are reflected in our pricing for new acquisitions, our previously-acquired inventory and homes under contract to be acquired may be at risk for potential market volatility. These factors, in turn, could negatively impact our revenue growth if resulting valuations are too low and/or fees are too high, or our profitability, if valuations are too high and/or fees are too low. In addition, inaccuracies in our models could result in us acquiring too many or too few properties to maximize profitability.
Previous wording
Once we have acquired a home, we may decrease our anticipated resale price for reasons such as unknown defects related to home condition requiring remediation, lower/higher than forecasted demand/supply, or other detractors that were unknown or missed at the time of acquisition. Shortages in building supplies, supply chain disruptions, and shortages and disruptions in the availability of third-party labor can also delay our ability to renovate and resell homes in a timely manner. These risks may be heightened when we expand into new markets where we may not have similar levels of knowledge and experience as we do in the markets where we currently operate. These factors could negatively impact our revenue, gross margins and results of operations, which could have a material adverse effect on our business, financial condition and results of operations.
Current wording
Once we have acquired a home, we may decrease our anticipated resale price for reasons such as unknown defects related to home condition requiring remediation, lower/higher than forecasted demand/supply, or other detractors that were unknown or missed at the time of acquisition. Shortages in building supplies, supply chain disruptions, and shortages and disruptions in the availability of third-party labor can also delay our ability to renovate and resell homes in a timely manner. These risks may be heightened in the markets where we have less operating history or penetration, where we may not have similar levels of knowledge and experience as we do in the markets where we have longer operating history or greater penetration. These factors could negatively impact our revenue, gross margins and results of operations, which could have a material adverse effect on our business, financial condition and results of operations.
Previous wording
A critical component of our business model is managing inventory exposure and balancing growth, margin, and risk. Our purchases of homes are based in large part on our estimates of projected demand. If actual sales are materially less than our forecasts, we would experience an over-supply of inventory. An over-supply of home inventory will generally cause downward pressure on our sales prices and margins and increase our average days to sale. Our inventory of homes purchased has typically represented a significant portion of total assets. Having such a large portion of our total assets in the form of non-income producing home inventory for an extended period of time subjects us to significant holding costs, including financing expenses, maintenance and upkeep, insurance, property taxes, homeowners’ association fees, and other expenses that accompany the ownership of residential real property and increased risk of depreciation of value. Disruptions in the supply chain for materials, such as paint and carpet, and constraints in the market for labor necessary to restore and resell home inventory could lengthen the period of time during which we must hold home inventory.
Current wording
A critical component of our business model is managing inventory exposure and balancing growth, margin, and risk. Our purchases of homes are based in large part on our estimates of projected demand. If actual sales are materially less than our forecasts, we would experience an oversupply of inventory. An oversupply of home inventory will generally cause downward pressure on our sales prices and margins and increase our average days to sale. Our inventory of homes purchased has typically represented a significant portion of total assets. Having such a large portion of our total assets in the form of non-income producing home inventory for an extended period of time subjects us to significant holding costs, including financing expenses, maintenance and upkeep, insurance, property taxes, homeowners’ association fees, and other expenses that accompany the ownership of residential real property and increased risk of depreciation of value. Disruptions in the supply chain for materials, such as paint and carpet, and constraints in the market for labor necessary to restore and resell home inventory could lengthen the period of time during which we must hold home inventory. In addition, certain regulations may impede our ability to expeditiously sell inventory to buyers with mortgage loan restrictions. For example, Federal Housing Administration (“FHA”) insured loans require that the seller has owned the home for at least 90 days prior to closing, which could also lengthen the period of time during which we must hold home inventory.
Previous wording
In addition, the value of homes in inventory may decline, and we could experience losses as a result, which in the aggregate could be detrimental to our business and results of operations. For example, due in part to macroeconomic factors such as increased interest rates and lower consumer confidence stemming from recession risk, in the second half of 2023 and most of 2024, market clearance rates slowed, which resulted in reduced pace of our resales. As a result, we reduced home-level prices to stay in line with our clearance rate targets, which adversely affected our results of operations, and may adversely affect our results of operations in the future. Furthermore, if we have excess inventory or our average days to sale increases, as was the case in the second half of 2022 alongside home price value decreases, the results of our operations may be adversely affected because we may be unable to liquidate such inventory at prices that allow us to meet margin targets or to recover our costs.
Current wording
In addition, the value of homes in inventory may decline, and we could experience losses as a result, which in the aggregate could be detrimental to our business and results of operations. For example, due in part to macroeconomic factors such as increased interest rates and lower consumer confidence stemming from recession risk, in the second half of 2023 and most of 2024 and 2025, market clearance rates slowed, which resulted in reduced pace of our resales. As a result, we reduced home-level prices to stay in line with our clearance rate targets, which adversely affected our results of operations, and may adversely affect our results of operations in the future. Furthermore, if we have excess inventory or our average days to sale increases, as was the case in the second half of 2022 alongside home price value decreases, the results of our operations may be adversely affected because we may be unable to liquidate such inventory at prices that allow us to meet margin targets or to recover our costs.
Previous wording
In order to operate more efficiently and control costs, from time to time, we undertake restructuring plans and other cost savings initiatives, which include workforce reductions as well as changes to our business strategy. These plans are intended to generate, among other things, operating expense savings and improved margins. For example, in November 2024, we implemented a reduction in force affecting approximately 17% of our employees, and in July 2024, we deconsolidated our subsidiary, Mainstay Labs Inc., in which we retain less than 50% ownership on a fully diluted basis.
Current wording
In order to operate more efficiently and control costs, from time to time, we undertake restructuring plans and other cost savings initiatives, which include workforce reductions as well as changes to our business strategy. These plans are intended to generate, among other things, operating expense savings and improved margins. For example, in November 2024, we implemented a reduction in force affecting approximately 17% of our employees, and in July 2024, we deconsolidated our subsidiary, Mainstay Labs Inc., in which we retain less than 50% ownership on a fully diluted basis. In addition, during the third quarter of 2025, we further reduced spend on external software, software vendors, and external consultants.
Previous wording
Declining real estate values have resulted in, and could continue to result in, inventory valuation adjustments, which have and may continue to adversely affect our financial condition and operating results.
Current wording
Declines in real estate values have resulted in, and could continue to result in, inventory valuation adjustments, which have and may continue to adversely affect our financial condition and operating results.
Previous wording
There are risks inherent in owning properties and inventory risks are substantial for our business. Home prices have been and can be volatile, and the values of our inventory have and may continue to fluctuate significantly. As a result of such fluctuations, we have in the past and may in the future incur inventory valuation adjustments. We periodically review the value of our properties to determine whether their value, based on market factors and generally accepted accounting principles, has decreased such that it is necessary or appropriate to record an inventory valuation adjustment in the relevant accounting period. As a result of such review, we recorded an inventory valuation adjustment of $57 million in 2024, of which $25 million related to homes remaining in inventory at December 31, 2024. These adjustments, based upon anticipated, but not realized losses, caused an immediate reduction of net income and a corresponding decrease in real estate inventory in the accounting period identified. Even if we do not determine that it is necessary or appropriate to record an inventory valuation adjustment in the current financial period, a reduction in the estimated net realizable value of a property could subsequently manifest and would therefore affect our earnings and financial condition at that time.
Current wording
There are risks inherent in owning properties and inventory risks are substantial for our business. Home prices have been and can be volatile, and the values of our inventory have fluctuated and may continue to fluctuate significantly. As a result of such fluctuations, we have in the past and may in the future incur inventory valuation adjustments. We periodically review the value of our properties to determine whether their value, based on market factors and generally accepted accounting principles, has decreased such that it is necessary or appropriate to record an inventory valuation adjustment in the relevant accounting period. As a result of such review, we recorded an inventory valuation adjustment of $57 million in 2025, of which $19 million related to homes remaining in inventory at December 31, 2025. These adjustments, based upon anticipated, but not realized losses, caused an immediate reduction of net income and a corresponding decrease in real estate inventory in the accounting period identified. Even if we do not determine that it is necessary or appropriate to record an inventory valuation adjustment in the current financial period, a reduction in the estimated net realizable value of a property could subsequently manifest and would therefore affect our earnings and financial condition at that time.
Previous wording
Launches of new product or service offerings and expansions of existing products, like our List with Opendoor and Opendoor Marketplace products, may consume significant financial and other resources and may not achieve the desired results.
Current wording
Launches of new product or service offerings and expansions of existing products, like our Cash and Cash Plus offerings, may consume significant financial and other resources and may not achieve the desired results.
Previous wording
We regularly evaluate launching new product or service offerings to our customers, as well as expanding existing offerings. Such offerings may require significant expenses, new sources of capital and financing, and time of our key personnel. New or expanded product and service offerings may also subject us to new regulatory environments, which could increase our costs as we evaluate compliance with the new regulatory regime. Despite the expenses and time devoted to launching new or expanded product or service offerings, we may fail to achieve the financial and market share goals anticipated, which may adversely affect our business and results of operations.
Current wording
We regularly evaluate launching new product or service offerings to our customers, as well as expanding existing offerings. For example, during the third quarter of 2025, we launched over a dozen new products or features for existing products. Also in late 2025, we began expanding our buybox from a limited set of geographies to effectively nationwide coverage across the contiguous United States, with the ability to make offers in substantially all residential zip codes. In early 2026, we launched a mortgage business in Colorado and plan to expand into additional states. In addition, we aim to increase our value to each homeowner by launching or expanding services such as homeowners’ insurance and warranty services. Such offerings may require significant expenses, new sources of capital and financing, and time of our key personnel. New or expanded product and service offerings may also subject us to new regulatory environments, which could increase our costs as we evaluate compliance with the new regulatory regime. Despite the expenses and time devoted to launching new or expanded product or service offerings, we may fail to achieve the financial and market share goals anticipated, which may adversely affect our business and results of operations.
Previous wording
For example, our Opendoor Marketplace product is only available in a limited number of markets, and our List with Opendoor product, while currently available in nearly all of our markets, has a limited operating history. Expanding offerings such as our List with Opendoor and Opendoor Marketplace products and setting up new offerings comes with substantial upfront costs and we may not achieve profitability in time, if at all, to make up for those costs. Further, there is no guarantee that buyers and sellers will want to transact in a manner contemplated by such offerings, or that we will be able to attract a sufficient number of sellers to attract buyers, or a sufficient number of buyers to attract sellers. In addition, we may encounter difficulties in building and marketing new offerings, such as obtaining the necessary licensing and staffing, building a marketing apparatus for the offering, or standing up other business operations. These difficulties could make expanding to new markets too slow to cover the fixed and upfront costs of setting up the marketplace. Incumbents in the industry may also organize efforts to oppose our innovations and find ways to use existing regulations, or convince authorities to make new regulations that would make our business model unviable. Even if we are successful, it may attract competitors who reduce the size of our market or its economic viability. Those competitors may have strategic advantages that make them better able to provide marketplace services or expand those services to new markets faster than we can, and we may be unable to compete in a sustainable way. As we expand to new markets, we may find that local preferences, conditions, or regulations differ from our other markets such that the benefits of scale do not materialize. In addition, developing and marketing our List with Opendoor and Opendoor Marketplace products could have higher costs than anticipated and could adversely impact our results or dilute our brand.
Current wording
For example, our Cash product is only available in certain of our markets, and our Cash Plus product, while currently available in all zip codes in the contiguous 48 states, has a limited operating history. Additionally, our mortgage services are only available in one market and have a limited operating history. Expanding offerings such as our Cash, Cash Plus, and mortgage products and setting up new offerings comes with substantial upfront costs and we may not achieve profitability in time, if at all, to make up for those costs. Further, there is no guarantee that buyers and sellers will want to transact in a manner contemplated by such offerings, or that we will be able to attract a sufficient number of sellers and buyers. In addition, we may encounter difficulties in building and marketing new offerings, such as obtaining the necessary licensing and staffing, complying with local regulations, building a marketing apparatus for the offering, or standing up other business operations. These difficulties could make our recent expansion to new markets too slow to cover the fixed and upfront costs of setting up new and expanded offerings. Incumbents in the industry may also organize efforts to oppose our innovations and find ways to use existing regulations, or convince authorities to make new regulations that would make our business model unviable. Even if we are successful, it may attract competitors who reduce the size of our market or its economic viability. Those competitors may have strategic advantages that make them better able to provide services or expand those services to our markets faster than we can, and we may be unable to compete in a sustainable way. After our recent market expansion, we may find that local preferences, conditions, or regulations differ in newer markets compared to the markets in which we have a longer operating history such that the benefits of scale do not materialize. In addition, developing and marketing our Cash, Cash Plus, and mortgage products could have higher costs than anticipated and could adversely impact our results or dilute our brand.
Previous wording
Our long-term success depends in part on our ability to continue to attract more buyers and sellers to our platform in each of our markets. We believe that an important component of our growth will be the attraction of potential customers to our website and mobile application. Our marketing efforts may not succeed for a variety of reasons, including changes to search engine and social network algorithms, ineffective campaigns across marketing channels, and limited experience in certain marketing channels. We may also be unable to deliver a sufficiently rewarding experience on mobile devices whether through our mobile website or mobile application, which may make us unable to attract and retain customers. External factors beyond our control may also affect the success of our marketing initiatives, such as filtering of our targeted communications by email servers, buyers and sellers failing to respond to our marketing initiatives, and competition from third parties. Any of these factors could reduce the number of customers coming to our platform. We also believe that the brand identity that we have developed is a significant factor in the success of our business, and maintaining and enhancing the Opendoor brand is critical to maintaining and expanding our customer base and current and future partners. Failure to promote or maintain our brand, or incurring excessive costs in this effort, could adversely affect our growth, results of operations, and financial condition.
Current wording
Our long-term success depends in part on our ability to continue to attract more buyers and sellers to our platform in each of our markets. We believe that an important component of our growth is the attraction of potential customers to our website and mobile application. Our marketing efforts may not succeed for a variety of reasons, including changes to search engine and social network algorithms, ineffective campaigns across marketing channels, and limited experience in certain marketing channels. We may also be unable to deliver a sufficiently rewarding experience on mobile devices whether through our mobile website or mobile application, which may make us unable to attract and retain customers. External factors beyond our control may also affect the success of our marketing initiatives, such as filtering of our targeted communications by email servers, buyers and sellers failing to respond to our marketing initiatives, and competition from third parties. Any of these factors could reduce the number of customers coming to our platform. We also believe that the brand identity that we have developed is a significant factor in the success of our business, and maintaining and enhancing the Opendoor brand is critical to maintaining and expanding our customer base and current and future partners. Failure to promote or maintain our brand, or incurring excessive costs in this effort, could adversely affect our growth, results of operations, and financial condition.
Previous wording
A significant portion of our expenses are fixed and do not vary proportionately with fluctuations in revenues. We need to maintain and continue to increase our transaction volumes to benefit from operating efficiencies and continue to optimize our cost structure. When we operate at less than expected capacity, fixed costs are inflated and represent a larger percentage of overall cost basis and percentage of revenue. Due to our fixed cost base, our operating results can vary significantly based on transaction volumes in any given period. For example, our fixed costs have not decreased proportionately to our decreasing revenue, beginning in the second quarter of 2022. This contributed to increased losses in 2022, 2023, and 2024 when transaction volumes declined. If we are unable to effectively adapt or optimize our cost structure to offset declines in our revenue, including as a result of cost structure reduction initiatives we began implementing in 2024, it could have a material adverse effect on our growth, results of operations, and financial condition.
Current wording
A significant portion of our expenses are fixed and do not vary proportionately with fluctuations in revenues. We need to maintain and continue to increase our transaction volumes to benefit from operating efficiencies and continue to optimize our cost structure. When we operate at less than expected capacity, fixed costs are inflated and represent a larger percentage of overall cost basis and percentage of revenue. Due to our fixed cost base, our operating results can vary significantly based on transaction volumes in any given period. For example, our fixed costs have not decreased proportionately to our decreasing revenue, beginning in the second quarter of 2022. This contributed to increased losses in 2022, 2023, and 2024 when transaction volumes declined. If we are unable to effectively adapt or optimize our cost structure to offset declines in our revenue, including as a result of cost structure reduction initiatives we began implementing in 2024 and additional AI efficiencies we began implementing in 2025, it could have a material adverse effect on our growth, results of operations, and financial condition.
Previous wording
In order to grow our business, we anticipate that we will continue to depend on relationships with third parties, such as settlement service providers, lenders, real estate agents, valuation companies, vendors we use to service and repair our homes, third-party partners we rely on for referrals, such as homebuilders and online real estate websites, and institutional buyers of our inventory, such as single-family rental REITs. Identifying partners, negotiating and documenting agreements with them, and establishing and maintaining good relationships requires significant time and resources.
Current wording
In order to grow our business, we anticipate that we will continue to depend on relationships with and the financial success of third parties, such as settlement service providers, lenders, real estate agents, valuation companies, home inspectors, vendors we use to service and repair our homes, third-party partners we rely on for referrals, such as homebuilders and online real estate websites, and institutional buyers of our inventory, such as single-family rental REITs. If these third parties experience financial distress, our relationships may be adversely impacted. Identifying partners, negotiating and documenting agreements with them, and establishing and maintaining good relationships requires significant time and resources. Furthermore, in order to grow our business, we are offering more direct-to-consumer product offerings, which may impede our ability to maintain productive relationships with certain of our third-party partners.
Previous wording
The loss of one or more of our key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm our business.
Current wording
We rely on highly skilled personnel and the loss of one or more of our key personnel, or our failure to attract, motivate and retain other highly qualified personnel in the future, could harm our business.
Previous wording
Our success depends upon the continued service of our senior management team and successful transitions when management team members pursue other opportunities. In addition, our business depends on our ability to continue to attract, motivate, and retain a large number of skilled employees across all of our product lines. Furthermore, much of our key technology and processes are custom-made for our business by our personnel. The loss of key personnel, including key members of management, could materially and adversely affect our ability to build on the efforts they have undertaken and to execute our business plan, and we may not be able to find adequate replacements. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees in a cost-effective manner, our business could be harmed.
Current wording
The loss of highly skilled or key personnel, including key members of our senior management team, could materially and adversely affect our ability to build on the efforts they have undertaken and to execute our business plan, and we may not be able to find adequate replacements on a timely basis or at all. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees in a cost-effective manner, our business could be harmed.
Previous wording
Our business is concentrated in certain geographic markets. Exposure to local economies, regional economic downturns, severe weather, or catastrophic occurrences, or other disruptions or events may materially adversely affect our financial condition and results of operations.
Current wording
Our business is more concentrated in certain geographic markets. Exposure to local economies, regional economic downturns, severe weather, or catastrophic occurrences, or other disruptions or events may materially adversely affect our financial condition and results of operations.
Previous wording
As of December 31, 2024, we were in 50 markets across the United States. For the year ended December 31, 2024, a majority of our revenue was generated from our top-nine markets by revenue. Local and regional conditions in these markets may differ significantly from prevailing conditions in the United States or other parts of the country. As a result, any unforeseen events or circumstances that negatively affect these areas could materially adversely affect our revenues and profitability. These risks include, without limitation: possible declines in the value of real estate; risks related to general and local economic conditions; demographic and population shifts and migration; possible lack of availability of mortgage funds; overbuilding; extended vacancies of properties; increases in competition, property taxes and operating expenses; changes in zoning laws; increased labor costs; unemployment; costs resulting from the clean-up of, and liability to third parties for damages resulting from, environmental problems; casualty or condemnation losses; changes in meteorological or climatic conditions; and uninsured damages from floods, hurricanes, tornadoes, wildfires, earthquakes or other natural disasters or severe weather events, which may become more frequent or severe as a result of climate change.
Current wording
As of December 31, 2025, we had nationwide coverage across the contiguous United States, with the ability to make offers in substantially all residential zip codes. For the year ended December 31, 2025, a majority of our revenue was generated from our top-ten markets by revenue. Local and regional conditions in these markets may differ significantly from prevailing conditions in the United States or other parts of the country. As a result, any unforeseen events or circumstances that negatively affect these areas could materially adversely affect our revenues and profitability. These risks include, without limitation: possible declines in the value of real estate; risks related to general and local economic conditions; demographic and population shifts and migration; possible lack of availability of mortgage funds and homeowners’ insurance; overbuilding; extended vacancies of properties; increases in competition, property taxes and operating expenses; changes in zoning laws; increased labor costs; unemployment; costs resulting from the clean-up of, and liability to third parties for damages resulting from, environmental problems; casualty or condemnation losses; changes in meteorological or climatic conditions; and uninsured damages from floods, hurricanes, tornadoes, wildfires, earthquakes or other natural disasters or severe weather events, which may become more frequent or severe as a result of climate change.
Previous wording
We primarily acquire homes directly from consumers and there can be no assurance of an adequate supply of such homes on terms that are attractive to us. A reduction in the availability of or access to inventory, including due to macroeconomic conditions, could have a material adverse effect on our business, sales, and results of operations. Additionally, we evaluate thousands of potential homes daily using our proprietary pricing model. If we fail to adjust our pricing to stay in line with broader market trends, or fail to recognize those trends, it could adversely affect our ability to acquire inventory.
Current wording
We primarily acquire homes directly from consumers and there can be no assurance of an adequate supply of such homes on terms that are attractive to us. A reduction in the availability of or access to inventory, including due to macroeconomic conditions or regulatory changes, could have a material adverse effect on our business, sales, and results of operations. Additionally, we evaluate thousands of potential homes daily using our proprietary pricing model and AI capabilities. If we fail to adjust our pricing to stay in line with broader market trends, or fail to recognize those trends, it could adversely affect our ability to acquire and resell inventory.
Previous wording
Our ongoing ability to acquire homes is critical to our business model. A lack of available homes that meet our purchase criteria may have adverse effects on our ability to reach our desired inventory levels, our desired portfolio diversification, and our results of operations. For example, during 2023 and 2024, historically low listing volumes, due in part to macro uncertainty in the housing market and elevated mortgage rates, constrained the supply of homes on the market and limited our access to desirable inventory.
Current wording
Our ongoing ability to acquire homes is critical to our business model. A lack of available homes that meet our purchase criteria may have adverse effects on our ability to reach our desired inventory levels, our desired portfolio diversification, and our results of operations. For example, in recent periods, historically low listing volumes, due in part to macro uncertainty in the housing market and elevated mortgage rates, have constrained the supply of homes on the market and limited our access to desirable inventory.
Previous wording
The secondary market for mortgage loans continues to primarily desire securities backed by Fannie Mae, Freddie Mac, or Ginnie Mae, and we believe the liquidity these agencies provide to the mortgage industry is important to the housing market. Any significant change regarding the long-term structure and viability of Fannie Mae and Freddie Mac could result in adjustments to the size of their loan portfolios and to guidelines for their loan products. Additionally, a reduction in the availability of financing provided by these institutions could adversely affect interest rates, mortgage availability, and sales of new homes and mortgage loans.
Current wording
However, the secondary market for mortgage loans continues to currently primarily desire securities backed by Fannie Mae, Freddie Mac, or Ginnie Mae, and we believe the liquidity these agencies provide to the mortgage industry is important to the housing market. Any significant adverse change regarding the long-term structure and viability of Fannie Mae and Freddie Mac, including their financial condition or underwriting criteria, could result in adjustments to the size of their loan portfolios and to guidelines for their loan products and materially and adversely affect our mortgage business. Additionally, a reduction in the availability of financing provided by these institutions could adversely affect interest rates, mortgage availability, and sales of new homes and mortgage loans.
Previous wording
Mortgage financing for a new home is also conditioned, among other things, on the availability of adequate homeowners’ insurance. There can be no assurance that homeowners’ insurance will be available or affordable to prospective purchasers of our homes. Long-term restrictions on, or unavailability of, homeowners’ insurance could have an adverse effect on the residential real estate industry in our markets and on our business.
Current wording
Moreover, certain insurance companies doing business in our markets could restrict, curtail or suspend the issuance of homeowners’ insurance policies on single-family homes. This could both reduce the availability of hurricane, fire, and other types of natural disaster insurance, in general, and increase the cost of such insurance to prospective purchasers of homes. Mortgage financing for a new home is also conditioned, among other things, on the availability of adequate homeowners’ insurance. There can be no assurance that homeowners’ insurance will be available or affordable to prospective purchasers of our homes. Long-term restrictions on, or unavailability of, homeowners’ insurance could have an adverse effect on the residential real estate industry in our markets and on our business.
Previous wording
From March 2022 to July 2023, the Federal Reserve Board raised its benchmark rate multiple times from 0.25% to 5.50%. While the Federal Reserve Board has since decreased the benchmark rate to 4.50%, mortgage interest rates remain elevated compared to recent historical levels. As a result of these significantly elevated interest rates, the cost of financing a home purchase has increased significantly for the typical home buyer, which has reduced the affordability of mortgage financing and resulted in a decline in the demand for our homes. Future increases in mortgage rates could further decrease our buyers’ ability or desire to obtain financing, which would adversely affect our business and financial results.
Current wording
From March 2022 to July 2023, the Federal Reserve Board raised its benchmark rate multiple times from 0.25% to 5.50%. While the Federal Reserve Board has since decreased the benchmark rate to 3.75%, mortgage interest rates remain elevated compared to recent historical levels. As a result of these elevated interest rates, the cost of financing a home purchase has increased significantly for the typical home buyer, which has reduced the affordability of mortgage financing and resulted in a decline in the demand for our homes. Future increases in mortgage rates could further decrease our buyers’ ability or desire to obtain financing, which would adversely affect our business and financial results.
Previous wording
Any limitation on, or reduction or elimination of, tax benefits associated with homeownership would have an adverse effect upon the demand for homes, which could adversely affect our business and financial results.
Current wording
Any limitation on, or reduction or elimination of, tax benefits associated with homeownership and/or selling residential real estate would have an adverse effect upon the demand for homes, which could adversely affect our business and financial results.
Previous wording
While federal income tax laws and, in many cases, state income tax laws generally permit certain significant expenses associated with homeownership, primarily mortgage interest expense and property taxes, to be deducted for the purpose of calculating an individual’s taxable income, the ability to deduct mortgage interest expense and property taxes for federal and state income tax purposes is subject to significant limitations. The federal government or a state government may change its income tax laws by eliminating, further limiting or otherwise substantially reducing these income tax benefits, which may increase the after-tax cost of owning a new home for many of our potential homebuyers. Any such future changes may have an adverse effect on the residential real estate industry in general. For example, the loss or reduction of some or all homeowner tax deductions could decrease the demand for new homes. Any such future changes could also have a material adverse impact on our business, results of operations, and financial condition.
Current wording
While federal income tax laws and, in many cases, state income tax laws generally permit certain significant expenses associated with homeownership, primarily mortgage interest expense and property taxes, to be deducted for the purpose of calculating an individual’s taxable income, the ability to deduct mortgage interest expense and property taxes for federal and state income tax purposes is subject to significant limitations. For example, the Tax Cuts and Jobs Act of 2017 introduced a cap on the amount of state and local taxes (including property taxes) that could be deducted from income for U.S. federal income tax purposes (the “SALT deduction”) and further limited the deduction of interest paid on certain home mortgages. Although the OBBBA increased the cap for the SALT deduction through December 31, 2029, the bill also made permanent the limitation on interest paid on certain home mortgages. In addition, federal and many state income tax laws provide capital gains tax exemptions for certain residential real estate sales, but these exemptions are often subject to caps and other significant limitations. The federal government or a state government may change its income tax laws by eliminating, further limiting or otherwise substantially reducing these income tax benefits, which may increase the after-tax cost of owning a new home for many of our potential homebuyers, or reduce incentives for home sellers. Any such future changes may have an adverse effect on the residential real estate industry in general. For example, the loss or reduction of some or all homeowner tax deductions or tax exemptions for home sellers could decrease the demand for new homes or decrease the supply of available homes, respectively. Any such future changes could also have a material adverse impact on our business, results of operations, and financial condition.
Previous wording
The residential real estate industry faces significant pressure from private lawsuits and investigations by the Department of Justice (the “DOJ”) with regards to antitrust and other issues, including with respect to lawsuits and investigations in which we are not a named party.
Current wording
The residential real estate industry faces significant pressure from private lawsuits and investigations by the DOJ with regards to antitrust, the display of listings on and off the MLS, and other issues, including with respect to lawsuits and investigations in which we are not a named party.
Previous wording
On March 15, 2024, NAR entered a settlement agreement to resolve on a class-wide basis the claims against NAR in the NAR Class Action. In addition to a monetary payment of $418 million, NAR agreed to change certain business practices, including changes to cooperative compensation and buyer agreements, which went into effect on August 17, 2024. Specifically, among other things, the NAR settlement agreement: (1) prohibits NAR and REALTOR® MLSs from requiring that listing brokers or sellers make offers of compensation to buyer brokers or other buyer representatives; (2) prohibits NAR, REALTOR® MLSs and MLS participants from making an offer of compensation on the MLS; and (3) requires all REALTOR® MLS participants to enter into a written buyer agreement specifying compensation before taking a buyer on tour. The NAR settlement received final court approval on November 26, 2024. Class action suits raising similar claims are pending and the outcome of the NAR Class Action may result in additional such actions being filed.
Current wording
On March 15, 2024, NAR entered a settlement agreement to resolve on a class-wide basis the claims against NAR in the NAR Class Action. In addition to a monetary payment of $418 million, NAR agreed to change certain business practices, including changes to cooperative compensation and buyer agreements, which went into effect on August 17, 2024. Specifically, among other things, the NAR settlement agreement: (1) prohibits NAR and REALTOR® MLSs from requiring that listing brokers or sellers make offers of compensation to buyer brokers or other buyer representatives; (2) prohibits NAR, REALTOR® MLSs and MLS participants from making an offer of compensation on the MLS; and (3) requires all REALTOR® MLS participants to enter into a written buyer agreement specifying compensation before taking a buyer on tour. The NAR settlement received final court approval on November 26, 2024. Class action suits raising similar or related claims are pending and the outcome of the NAR Class Action may result in additional such actions being filed.
Showing the first 40 of 94 pairs. Open the source sections for the rest.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
In addition, subject to limited exceptions, holders of the Convertible Senior Notes have the right to require us to repurchase their 2026 Notes or 2030 Notes, respectively, upon the occurrence of a fundamental change at a cash repurchase price generally equal to 100% of the principal amount of the applicable 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
Current report — wording carried from elsewhere
Notes have the right to require us to repurchase all or part of their 2030 Notes on May 15, 2028 at a cash repurchase price equal to 100% of the principal amount of their 2030 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Moreover, certain insurance companies doing business in our markets could restrict, curtail or suspend the issuance of homeowners’ insurance policies on single-family homes. This could both reduce the availability of hurricane, fire, and other types of natural disaster insurance, in general, and increase the cost of such insurance to prospective purchasers of homes.
Previous report — wording carried elsewhere
GAAP financial measure. See “—Non-GAAP Financial Measures” for further details and a reconciliation of Contribution Profit (Loss) to its nearest comparable GAAP measure.
Previous report — wording carried elsewhere
While we strive to ensure that all of our marketing communications comply with the requirements set forth in the CAN-SPAM Act, any violations could result in the Federal Trade Commission (“FTC”) seeking civil penalties against us.