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Investing.com -- Opendoor Technologies Inc. (NASDAQ:OPEN) plunged 14% early Wednesday following its second-quarter earnings release, after third-quarter guidance came in well below expectations, clashing with elevated investor hopes fueled by a recent surge in retail enthusiasm and activist engagement. While the company reported $1.6 billion in revenue, beating estimates and achieving positive adjusted EBITDA for the first time since 2022, the sharp sequential drop implied in its Q3 outlook rattled both institutional and retail shareholders looking for a sustained turnaround.
Retail excitement had reached a fever pitch in July as EMJ Capital CEO Eric Jackson catalyzed bullish momentum on social media, seeing Opendoor at a potential evaluation of $82 per share and invoking a return to activism. “I’ll saddle up again for OPEN,” he wrote on X. His commentary helped fuel a nearly 900% "meme stock" rally, lifting shares from 51 cents to almost $5 (for a time) and enabling the company to cancel a planned 50-to-1 reverse stock split after regaining Nasdaq compliance.
With that momentum in hand, many investors saw yesterday’s earnings call as a rare chance for CEO Carrie Wheeler to stake out a bold long-term vision. Instead, the call was widely criticized by shareholders as “low-energy” and lacking clarity on critical growth areas like artificial intelligence or margin-expanding initiatives. When asked by Bloomberg about the retail surge, Wheeler said, “It probably wasn’t on my bingo card for 2025.” Jackson fired back at the tepid response, saying, “I’m out on Carrie Wheeler. Next (LON:NXT) man or woman up!”
At the core of the backlash is an emerging consensus among activists and retail shareholders that Opendoor is failing to leverage a decade of proprietary data encompassing home valuations, photos, location analytics, and agent interactions. Jackson and Randian Capital argue the company should pivot to become the “AI lab of the housing market,” a vertical-first platform that redefines real estate through advanced machine learning. “Opendoor has the potential to be reshaped as an AI-first housing company... This requires a leader with the chops to do it,” Randian posted after the call.
Wheeler’s remarks instead emphasized operational discipline, highlighting a capital-light agent-led strategy and the rollout of “Cash Plus,” a hybrid product intended to reduce upfront capital needs while broadening seller options. “We are building on that foundation by expanding our agent-led distribution platform, enabling partner agents to offer multiple solutions to address each homeowner’s needs,” she said on the call.
However, financial guidance offset the operational strides. The company sold 4,299 homes in Q2, up 5% year-over-year, but acquisitions dropped 63% YoY to 1,757 homes as macro headwinds and tighter spreads limited buying. Gross margin slipped slightly to 8.2%, while third-quarter revenue guidance of $800 million to $875 million fell short of the $1.2 billion analysts had expected, representing a 48% sequential drop at the midpoint.
CFO Salim Freiha attributed the softer outlook to deliberate risk-management offsets, including wider offer spreads and lower marketing spend. “Conditions had stabilized toward the end of Q2,” he noted, but remained “well below” earlier-quarter levels. Investors, however, were unconvinced that caution alone could support long-term value. “No mention of the AI opportunity in front of them?... Where was the passion and grand strategic vision from Carrie?” Jackson asked.
Randian Capital echoed that sentiment in exclusive comments to Investing.com, arguing the company now requires “a CEO with the vision and charisma to execute on what we see as the largest AI opportunity hiding in plain sight,” one “in the mold of [Palantir CEO] Alex Karp” capable of articulating a platform-level vision for the decade ahead.
Jackson and others argue that despite Wheeler’s steady stewardship through tough macro conditions, the platform’s full potential remains unfulfilled. He called for the return of co-founder Keith Rabois, who also has been critical of the company’s leadership from afar. "Your founder DNA. Your vision... This is our return of Steve Jobs moment.”
While Opendoor edges closer to sustained profitability, investor pressure for transformational leadership and strategic ambition is intensifying. Opendoor has not yet responded to Investing.com’s request for commentary.
“Are all these bads actually a good?” Jackson concluded. “One thing we’ve learned is that it doesn’t take much for this stock price to flip upwards on the sniff of good news coming.”