Opendoor Technologies : 2Q22 Letter to Shareholders

Letter to Shareholders

2Q22

The Gooden Family St. Augustine, Florida

A Note from Eric

Dear Shareholders,

At Opendoor, we are building a digital experience that enables consumers to buy, sell, and move at the tap of a button. Against a backdrop of heightened uncertainty in the current macro environment, this mission matters more than ever.

In Q2, we were proud of how we served our customers and of our financial results. We helped over 14,000 sellers move with peace of mind and delivered revenue of $4.2 billion, growing over 250%year-over-year, with gross profit of $486 million and record Contribution Profit of $422 million.

In pursuit of our mission, we continue to make strides towards serving home sellers nationwide and building a digital home buying experience. For home sellers, we expanded our footprint by six new markets, surpassing a milestone of over 50 markets in total. We have also entered into a multi-year exclusive partnership with Zillow so that home sellers on the Zillow platform can request an offer directly from Opendoor, combining two category leaders to transform how people start their move. For home buyers, we launched our financing app,which provides mortgage pre-approvalin as little as 60-secondsandis being seamlessly integrated with the rest of our product suite. Most recently, we announced Opendoor Exclusives, an exclusive marketplace for our homes. A recent customer described Exclusives as, "I felt like I was shopping for a home on Amazon. The process was seamless and uncomplicated." To that end, we have built a new e-commerce-likeexperience enabling home buyers to buy directlyfrom Opendoor with simplicity, certainty, and speed.

We are pleased with these results, and our long-term vision remains clear. As we look ahead, current volatility in the housing market is requiring a highly dynamic and rigorous approach to managing risk and overall inventory health. As most are aware, the housing market has moved rapidly in response to the Fed's aggressive rate hikes in an effort to curb inflation. This resulted in a steep increase in mortgage rates, which in turn catalyzed a slowdown in the rate of hometransactions and lower levels of home price appreciation from all-timehighs early in the year.

To navigate this market movement, our game plan is to move quicklyand with discipline. First, starting in May, we substantially increasedour spreads to incorporate the market shifts and to position future resale cohorts to meet or exceed our margin expectations. Second, we are prioritizing inventory health by reducing the price of our existing inventory in line with the market. While we expect to realize

Our Mission

Powering life's progress, one move at a time

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A Note from Eric

sequentially lower contribution margins in the second half of the year, these actions will enable strong financial performance beyond this period of market transition. And, for the homes weare acquiring today, we expect those to perform well and in linewith expectations. We will continue to leverage what we have built over the past eight years - our responsive pricing and operations platform, our low cost structure, and our strong balance sheet and capital position - all of which gives us theflexibility to operate from a position of strength.

Importantly, we will be balancing short-term risk managementwith long-termtransformative initiatives such as OpendoorExclusives. With our superior customer experience, platform capabilities, and operational excellence, we know this is an opportunity to strengthen our position and solidify our leadership as the category winner.

Eric Wu, Co-Founder & CEO

Our Mission

Powering life's progress, one move at a time

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Key Highlights

2Q22

• Revenue of $4.2 billion, up 254% versus 2Q21; with 10,482 total homes sold, up 201% versus 2Q21
• Gross profit of $486 million, versus $159 million in 2Q21, up 206% versus prior year; gross margin of 11.6%, versus 13.4% in 2Q21
• Net loss of ($54) million, versus ($144) million in 2Q21
• Adjusted Net Income of $122 million, versus $3 million in 2Q21
• Contribution Profit of $422 million, versus $128 million in 2Q21; Contribution Margin of 10.1%, versus 10.8% in 2Q21
• Adjusted EBITDA of $218 million, versus $25 million in 2Q21; Adjusted EBITDA Margin of 5.2%, versus 2.2% in 2Q21
• Inventory balance of 17,013 homes, representing $6.6 billion in value, up 143% versus 2Q21
• Purchased 14,135 homes, up 66% versus 2Q21
• Launched New York and New Jersey, Detroit, Southwest Florida, Boston, Albuquerque, and Cincinnati; bringing us to 51 markets at the end of 2Q22

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Julie Damavandi

Las Vegas, Nevada

After 41 years in her home in Las Vegas, Julie Damavandi was ready for a fresh start. She had raised her children there, mostly as a single parent, as it was where she had lived after her husband passed away. Despite years of happy memories, there were corners of the house that reminded her of more challenging times.

Julie's lifelong dream was to own a brand new home, so she set her sights on a new-build community in Henderson, NV, away from the hustle and bustle of the city. She quickly found a home with her ideal floor plan, including two key items on her wish list: a large kitchen with an island and an oversized soaking tub. Julie completely fell in love with every detail of the house, but was then faced with the daunting task of selling her current house. At the recommendation of a salesperson in the new-build community, Julie reached out to Opendoor.

Within three days of requesting an offer, Julie was under contract to sell her home to Opendoor. She was in awe of the simplicity of the process and the ability to select her own closing date. Selling to Opendoor also meant that she didn't have to deal with the typical stressors associated with the traditional way of selling a home, like scheduling open houses, making repairs, and paying for an appraisal.

In less than 30 days, she had the proceeds from her home sale in her bank account, and she was finally empowered with the freedom to move. At home in Henderson, with the glow of the city lights in the distance, Julie found a quiet solace and a new sense of peace after leaving the emotional baggage of her previous home behind her. In her words, "Opendoor made it possible for me to unload all of that burden and be able to look forward and to feel the freedom that I needed to go into a new house."

Opendoor made this whole fresh start possible. There's no doubt in my mind that without Opendoor, this very well may not have happened.

- Julie Damavandi

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