What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-02-15 compared with 2023-02-23 · 279 added, 284 removed, 489 unchanged (54% of the section changed)

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Opendoor’s mission is to power life’s progress, one move at a time.

We are building a managed marketplace for residential real estate via two core product offerings:

our first-party (1P) product and our third-party (3P) product.

We are working towards a future where both 1P and 3P sales take place on our platform, enabling sellers and buyers to experience a simple and certain transaction that dramatically improves the traditional process.

Since our inception in 2014, we have built scalable pricing capabilities, technology-enabled centralized operations, and a suite of digital-first consumer products that enabled us to help customers buy or sell homes in over 215,000 transactions and expand our footprint to 53 markets across the country.

Financial Highlights

Residential real estate is a trillion-dollar industry underpinned by a process that is complicated, time-consuming, stressful, and offline.

We believe all consumers deserve to buy, sell, and move between homes with simplicity and confidence, and we have dedicated almost a decade to delivering on this vision.

We have built unique pricing and operations capabilities to become one of the largest buyers and sellers of homes in the United States.

Since our founding, we have helped customers to buy or sell homes in over 246,000 transactions and have expanded our footprint to 50 markets across the country.

Financial Highlights and Operating Metrics

Year Ended December 31,

(in millions, except percentages, homes sold, number of markets, and homes in inventory) 2022 2021 2020 2021 to 2022 Change

(in millions, except percentages, homes purchased, homes sold, number of markets, and homes in inventory)

2023 2022 2021 2022 to 2023 Change

2021 to 2022 Change

Revenue $ 6,946 $ 15,567 $ 8,021 $ (8,621) $ 7,546

Homes sold 39,183 21,725 9,913 17,458 11,812

Gross profit $ 487 $ 667 $ 730 $ (180) $ (63)

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Net loss $ (275) $ (1,353) $ (662) $ 1,078 $ (691)

Adjusted Net Loss $ (574) $ (116) $ (175) $ (458) $ 59

Contribution Profit $ 525 $ 525 $ 110 $ — $ 415

Number of markets (at period end) 50 53 44 (3) 9

Homes sold 18,708 39,183 21,725 (20,475) 17,458

Homes purchased

11,246 34,962 36,908 (23,716) (1,946)

Homes in inventory (at period end) 5,326 12,788 17,009 (7,462) (4,221)

Inventory (at period end) $ 1,775 $ 4,460 $ 6,096 $ (2,685) $ (1,636)

Percentage of homes “on the market” for greater than 120 days (at period end)

18 % 55 % 8 %

Non-GAAP Financial Highlights (1)

Contribution (Loss) Profit

$ (258) $ 525 $ 525 $ (783) $ —

Contribution Margin (3.7) % 3.4 % 6.5 %

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Adjusted EBITDA Margin (9.0) % (1.1) % 0.7 %

Number of markets (at period end) 53 44 21 9 23

Inventory (at period end) $ 4,460 $ 6,096 $ 466 $ (1,636) $ 5,630

Homes in inventory (at period end) 12,788 17,009 1,826 (4,221) 15,183

Adjusted Net Loss $ (778) $ (574) $ (116) $ (204) $ (458)

________________

(1) See “— Non-GAAP Financial Measures ” for further details and a reconciliation of such non-GAAP measures to their nearest comparable GAAP measures.

Current Housing Environment

The residential real estate market started 2022 quite strong with housing transaction volume, velocity, and home price appreciation (HPA) trending at or near historical highs.

However, the second half of 2022 was dominated by concerns of elevated inflation, rising interest rates, and increasing possibility of recession.

In response to surprisingly persistent inflationary pressures, the U.S.

Federal Reserve Board implemented a series of rate increases, increasing the Federal Funds Rate from 0.25% to 4.5% at the end of the year and marking the most aggressive response by the U.S.

Federal Reserve Board since the early 1980s.

These actions pushed long-term interest rates higher with mortgage rates following suit.

The ensuing decline in housing affordability drove a sharp pullback in home buyer demand, which precipitated a very rapid slowdown in both transaction velocity and home price appreciation (“HPA”) in the second half of 2022.

2023 was a year underpinned by macro uncertainty in the housing market, driven by interest rate volatility, which caused 30-year mortgage rates to increase by 170 basis points between February and October.

These dynamics resulted in hesitation by both buyers and sellers with overall home sales declining nearly 20% year-over-year.

In the first half of 2023, home prices

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios, or as noted)

In light of the market uncertainty and our reduced volume expectations, we scaled back our operational capacity by reducing both third-party labor and our internal workforce.

In addition, on November 2, 2022, we announced a workforce reduction of approximately 550 employees, representing 18% of our workforce at that time.

We provided post-employment benefits to impacted employees for a total cash cost of approximately $17 million, which was recognized and primarily paid in 2022.

Overall economic dynamics as of the beginning of 2023 look more balanced than as of the second half of 2022.

In particular, the seasonal relative improvement in listing prices, contract prices, and clearance has been, so far, better than in a typical year.

Of course, there remains significant macro risk in the outlook, with inflation, rate volatility and recession probabilities still at high levels.

The extent to which these factors impact our results and financial position will depend on future developments, which are uncertain and difficult to predict.

As a result, we are entering 2023 with a conservative bias in our home pricing, which reflects our current expectation for negative year-over-year HPA for 2023.

Business Impact of COVID-19

In response to the COVID-19 pandemic and the consequent health risks, we substantially paused purchasing additional homes in March 2020 to safeguard the health and safety of our customers and employees.

In addition to pausing new acquisitions, we sold down most of our homes in inventory at a healthy pace, leading to a low point in inventory of $152 million as of September 30, 2020.

As our revenues are dependent on inventory levels available for sale, we experienced sequential, quarter-over-quarter declines in revenue in the second, third and fourth quarters of 2020.

After retooling certain operational processes to enable “contactless” transactions, we resumed making offers to purchase homes in select markets in May 2020 and resumed operations across all of our markets by the end of August 2020.

We surpassed pre-COVID-19 inventory levels in the second quarter of 2021 and ended the year with inventory of $4.5 billion as of December 31, 2022.

While we believe we have adapted our operations to function effectively during the ongoing COVID-19 pandemic, our business remains sensitive to potential future disruptions of the real estate market caused by COVID-19 and its variants.

performed better than expected on the back of historically low listing volumes.

Against this backdrop of constrained supply, market clearance exceeded levels seen historically over the same time period.

In the second half of 2023, the elevated 30-year mortgage rates further depressed buyer demand, amplifying the typical seasonal decline in market clearance rates.

The slowing market clearance rates impacted our financial performance for the final quarter of 2023 in the following three ways.

First, as market clearance rates slowed, our pace of resales, and therefore revenue, was reduced quarter over quarter.

Second, although the impact was tempered by historically low listing volumes, we reduced home-level list prices in order to stay inline with our clearance targets, which flowed through to revenue, gross profit, gross margin and contribution margin.

Third, as a result of slower resale clearance rates, some sales from the old book of inventory shifted out of the third quarter of 2023 and continued to be a drag on overall margins as they sold through given their negative margin profile.

As we look ahead, the real-time metrics we track are continuing to show constrained supply and demand, which is resulting in home price stability.

Several macroeconomic indicators have been trending favorably, including a healthy U.S.

labor market and moderating inflation.

However, given continued interest rate volatility, we remain focused on preserving flexibility in setting spreads to operate against a range of macroeconomic outcomes in 2024.

Contribution Margin is a non-GAAP financial measure.

See “— Non-GAAP Financial Measures ” for further details and a reconciliation of Contribution Margin to Gross Margin.

Factors Affecting our Business Performance

Market Penetration in Existing Markets

Residential real estate is one of the largest consumer markets, with approximately $1.9 trillion of home value transacted annually.

Given the fact that we operate in a highly fragmented industry and offer a differentiated value proposition to the incumbent agent-led transaction, we believe there is significant opportunity to expand our share in our existing cities.

Residential real estate is one of the largest consumer markets in the United States, of which less than 1% of the estimated $1.6 trillion of home value transacted annually is conducted online.

Given the fact that we operate in a highly fragmented industry and offer a differentiated value proposition to the traditional offline selling process, we believe there is significant opportunity to expand our share in our existing markets.

By providing a consistent, high-quality and differentiated experience to our customers, we hope to continue to drive positive word-of-mouth awareness and trust in our platform.

We believe this creates a virtuous cycle, whereby more home sellers will request an offer from Opendoor, allowing us to deepen our market penetration.

We are launching our 3P product in certain markets where our sellers will connect directly with our buyers thereby expanding our target audience to additional sellers.

We expect this marketplace to reduce our inventory exposure, capital intensity and macroeconomic risk, which we believe has the potential to positively impact our results.

We also expect to launch our new partnership agreement with Zillow, Inc.

in early 2023 that will allow home sellers on the Zillow, Inc.

platform to request an offer directly from Opendoor, which will create an additional channel for us to drive brand awareness and acquire customers.

Expansion into New Markets

We operated in 53 markets as of December 31, 2022.

The following table represents the number of markets as of the periods presented:

We are steadily growing our reach via our partnership channels with homebuilders, agents, and online real estate platforms.

We have relationships with the three largest online real estate platforms, Zillow, Redfin, and Realtor.com, which collectively reach millions of unique monthly visitors.

We launched our partnership agreement with Zillow, Inc.

in early 2023, allowing home sellers on the Zillow, Inc.

platform to request an offer directly from Opendoor, and creating an additional channel for us to drive brand awareness and acquire customers.

As of December 31, 2023, our partnership was live in 45 markets.

In the fourth quarter of 2023, we also announced a new partnership agreement with eXp Realty, the largest independent real estate company in the world.

This agreement enables eXp’s agents to request a cash offer on qualifying properties on behalf of their clients directly within their eXp dashboard and present the Opendoor offer alongside the option of listing the client’s home on the market.

A continued source of growth is re-engagement with our base of registered sellers, meaning sellers that have received an offer from Opendoor but have not yet sold their home.

In the last ten years, we have sent millions of offers and, while not everyone is ready to act when they request an offer, we treat everyone as a potential future seller.

We perpetually iterate on our reengagement strategies and believe that our registered customer base will continue to be an important source of home acquisition volumes.

Market Footprint

The following table represents the number of markets we operated in as of the periods presented:

Year Ended December 31,

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Number of markets (at period end) 50 53 44

Due to the deteriorating macro environment in 2022 and 2023, we slowed down our new market expansion plans.

During the three months ended December 31, 2023, we stopped acquiring inventory in, and operationally supporting, our markets in Boise, Idaho, Reno, Nevada and Asheville, North Carolina.

These three markets are below the scale required for us to operate in

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios, or as noted)

We launched seven new markets in the first half of 2022, before we slowed our new market expansion plans due to the deteriorating macro environment in the latter half of the year, during which we launched two new markets.

We view the first year of a market launch as an investment period during which we refine our pricing models, renovation strategies and cost structure.

Historically, we have seen underwriting performance for purchase cohorts in new markets improve approximately one year after initial launch.

However, given our “risk-off” stance in our 1P business pending stabilization of macro conditions, we do not expect to make significant investments to support our 2022 market launches.

As a result, we also expect the revenue contribution from these markets to be immaterial until we see a sustained period of stabilization and recovery in the macro environment.

a cost-effective manner and are not sufficiently close to another market to leverage its operations.

In total, these three markets represented less than 1% of total homes sold in 2023.

Adjacent Services

We believe home sellers and buyers value simplicity and certainty.

To that end, we are building an online, integrated suite of home services, which currently include title insurance and escrow services, brokerage services and mortgage services.

In 2022, we shifted from a correspondent mortgage model to a referral model with a strategic partner to offer our customers a broader suite of mortgage products and services.

To that end, we are building an online, integrated suite of home services, which currently includes title insurance, escrow services and real estate brokerage services.

Our success with title insurance and escrow services helps validate our view that customers prefer an online, integrated experience.

We will continue to evaluate new ways to improve our end-to-end solution and expect to invest in additional adjacent products and services over time with the expectation that these adjacent services will continue to improve our unit economics and Contribution Margin.

Unit Economics

We view Contribution Margin as a key measure of unit economic performance.

Contribution Margin is a non-GAAP financial measure.

See “— Non-GAAP Financial Measures ” for further details and a reconciliation of Contribution Margin to Gross Margin.

Our long-term financial performance depends, in part, on continuing to maintain and expand unit margins through the following initiatives:

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• Incremental attach of services, which supplement the core transaction margin profile;

• Expansion of our 3P product offering, which will reduce our inventory exposure and capital intensity, and eliminate any holding and selling costs associated with taking ownership of the home

• Expansion of our listing and marketplace product offerings, which will reduce our inventory exposure and capital intensity, and eliminate the holding and selling costs associated with taking ownership of the home.

Inventory Management

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We typically seek to maximize the resale margin performance of our inventory in the context of managing overall risk and inventory health through monitoring sell-through rates, holding periods, and portfolio aging.

Our performance in 2022 reflects the sharp transition in the housing market from peak levels earlier this year to lower transaction velocity and home price appreciation well beyond typical seasonal trends.

Given these macroeconomic pressures, we have been focused on managing for overall inventory health and risk.

As part of that focus, we have continued to adjust down listed prices on our inventory to stay in-line with the market and drive resale clearance.

Related to those price actions, we have recorded inventory valuation adjustments of $737 million during the year ended December 31, 2022.

We have also proactively reduced our acquisition pace via higher spreads embedded in our offers and lower marketing investment.

While this allows us to manage overall inventory growth, we expect future margins on those acquisition cohorts to be in-line with our expectations for positive contribution margins.

We expect to resume a higher acquisition pace as the housing market stabilizes.

Our performance in 2023 reflects the sharp transition in the housing market from peak levels earlier in 2022 to lower transaction velocity and home price appreciation well beyond typical seasonal trends.

Given these macroeconomic pressures, we have been focused on managing overall inventory health and risk.

We have been particularly focused on homes that we acquired based on offers made in the first half of 2022 and prior (“old book”) and we have continued to adjust down listed prices on our inventory to stay in-line with market sell-through rates and drive resale clearance.

As of December 31, 2023, we had $34 million of old book homes in inventory, down 99% from $3.5 billion at December 31, 2022.

We also increased the spreads embedded in our offers and reduced our marketing investment, which slowed our acquisition pacing.

(Spreads are defined as total discount to our home valuation at time of offer less than Opendoor service fee of 5%.) We expect to achieve positive gross margins and contribution margins on acquisitions arising from offers made in the second half of 2022 onward once fully sold through, and we expect to resume a higher acquisition pace as the housing market stabilizes.

Related primarily to the sharp transition in the housing market, we recorded inventory valuation adjustments of $737 million during the year ended December 31, 2022.

In 2023, resale clearance is trending better than the back half of 2022 and a lack of supply of new listings has helped to stabilize home prices.

As such, inventory valuation adjustments of $65 million recorded during the year ended December 31, 2023 were significantly lower than 2022.

As one key measure of inventory management performance, we evaluate our portfolio metrics relative to the broader market (as observed on the multiple listing services (“MLS”)).

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(Tabular amounts in millions, except share and per share data and ratios, or as noted)

in a given market based on characteristics such as price range, home type, home location, year built and lot size (which we refer to as our “buybox".) This metric is impacted by the mix of homes in our inventory.

Beginning early in the third quarter of 2022, we significantly reduced our offer pace and subsequent closings of new home acquisitions in light of our risk management objective and overall macroeconomic uncertainty.

When newly acquired homes represent a smaller proportion of our overall inventory, average days on market for our portfolio generally increases and we expect this trend to continue into early 2023.

in a given market based on characteristics such as price range, home type, home location, year built and lot size (which we refer to as our “buybox”).

Inventory Financing

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generally accepted accounting principles (“GAAP”).

These measures have limitations as analytical tools when assessing our operating performance and should not be considered in isolation or as a substitute for GAAP measures, including gross profit and net income.

We may calculate or present our non-GAAP financial measures differently than other companies who report measures with similar titles and, as a result, the non-GAAP financial measures we report may not be comparable with those of companies in our industry or in other industries.

Adjusted Gross Profit and Contribution Profit

To provide investors with additional information regarding our margins and return on inventory acquired, we have included Adjusted Gross Profit and Contribution Profit, which are non-GAAP financial measures.

We believe that Adjusted Gross Profit and Contribution Profit are useful financial measures for investors as they are supplemental measures used by management in evaluating unit level economics and our operating performance.

Adjusted Gross Profit and Contribution Profit (Loss)

To provide investors with additional information regarding our margins and return on inventory acquired, we have included Adjusted Gross Profit and Contribution Profit (Loss), which are non-GAAP financial measures.

We believe that Adjusted Gross Profit and Contribution Profit (Loss) are useful financial measures for investors as they are supplemental measures used by management in evaluating unit level economics and our operating performance.

Each of these measures is intended to present the economics related to homes sold during a given period.

We do so by including revenue generated from homes sold (and adjacent services) in the period and only the expenses that are directly attributable to such home sales, even if such expenses were recognized in prior periods, and excluding expenses related to homes that remain in inventory as of the end of the period.

Contribution Profit provides investors a measure to assess Opendoor’s ability to generate returns on homes sold during a reporting period after considering home purchase costs, renovation and repair costs, holding costs and selling costs.

Adjusted Gross Profit and Contribution Profit are supplemental measures of our operating performance and have limitations as analytical tools.

Contribution Profit (Loss) provides investors a measure to assess Opendoor’s ability to generate returns on homes sold during a reporting period after considering home purchase costs, renovation and repair costs, holding costs and selling costs.

Adjusted Gross Profit and Contribution Profit (Loss) are supplemental measures of our operating performance and have limitations as analytical tools.

For example, these measures include costs that were recorded in prior periods under GAAP and exclude, in connection with homes held in inventory at the end of the period, costs required to be recorded under GAAP in the same period.

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Adjusted Gross Profit / Margin

We calculate Adjusted Gross Profit as gross profit under GAAP adjusted for (1) inventory valuation adjustment in the current period, (2) inventory valuation adjustment in prior periods, and (3) restructuring in cost of revenue.

Restructuring in

We calculate Adjusted Gross Profit as gross profit under GAAP adjusted for (1) inventory valuation adjustment in the current period and (2) inventory valuation adjustment in prior periods.

Inventory valuation adjustment in the current period is calculated by adding back the inventory valuation adjustments recorded during the period on homes that remain in inventory at period end.

Inventory valuation adjustment in prior periods is calculated by subtracting the inventory valuation adjustments recorded in prior periods on homes sold in the current period.

We define Adjusted Gross Margin as Adjusted Gross Profit as

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios, or as noted)

cost of revenue reflects the costs associated with the reduction in our workforce in 2020, a portion of which were related to personnel included in cost of revenue.

Inventory valuation adjustment in the current period is calculated by adding back the inventory valuation adjustments recorded during the period on homes that remain in inventory at period end.

Inventory valuation adjustment in prior periods is calculated by subtracting the inventory valuation adjustments recorded in prior periods on homes sold in the current period.

We define Adjusted Gross Margin as Adjusted Gross Profit as a percentage of revenue.

a percentage of revenue.

See “— Critical Accounting Policies and Estimates — Real Estate Inventory” for detailed discussion of inventory valuation adjustment.

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Contribution Profit / Margin

We calculate Contribution Profit as Adjusted Gross Profit, minus certain costs incurred on homes sold during the current period including:

We calculate Contribution Profit (Loss) as Adjusted Gross Profit, minus certain costs incurred on homes sold during the current period including:

(1) holding costs incurred in the current period, (2) holding costs incurred in prior periods, and (3) direct selling costs.

The composition of our holding costs is described in the footnotes to the reconciliation table below.

Contribution Margin is Contribution Profit as a percentage of revenue.

Contribution Margin is Contribution Profit (Loss) as a percentage of revenue.

We view this metric as an important measure of business performance as it captures the unit level performance isolated to homes sold in a given period and provides comparability across reporting periods.

Contribution Profit helps management assess inflows and outflows directly associated with a specific resale cohort.

Contribution Profit (Loss) helps management assess inflows and outflows directly associated with a specific resale cohort.

The following table presents a reconciliation of our Adjusted Gross Profit and Contribution Profit to our gross profit, which is the most directly comparable GAAP measure, for the periods indicated:

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(in millions, except percentages) 2023 2022 2021

Revenue (GAAP)

$ 6,946 $ 15,567 $ 8,021

Gross profit (GAAP) $ 487 $ 667 $ 730

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Inventory valuation adjustment – Prior Periods (1)(3)

Restructuring in cost of revenue (4)

Adjusted Gross Profit $ 55 $ 1,086 $ 769

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(66) (38) (2)

Contribution Profit $ 525 $ 525 $ 110

Contribution Profit (Loss)

$ (258) $ 525 $ 525

Contribution Margin (3.7) % 3.4 % 6.5 %

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(3) Inventory valuation adjustment — Prior Periods is the inventory valuation adjustments recorded in prior periods associated with homes that sold in the period presented.

OPENDOOR TECHNOLOGIES INC.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular amounts in millions, except share and per share data and ratios,or as noted)

(4) Restructuring in cost of revenue consists mainly of severance and employee termination benefits that were recorded to cost of revenue due to a reduction in workforce in the second quarter of 2020 following the outbreak of the COVID-19 pandemic.

(4) Represents selling costs incurred related to homes sold in the relevant period.

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(6) Represents holding costs incurred in the period presented on homes sold in the period presented.

OPENDOOR TECHNOLOGIES INC.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular amounts in millions, except share and per share data and ratios, or as noted)

(7) Represents holding costs incurred in prior periods on homes sold in the period presented.

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Adjusted Net Loss

We calculate Adjusted Net Loss as GAAP net loss adjusted to exclude non-cash expenses of stock-based compensation, equity securities fair value adjustment, derivative and warrant fair value adjustment, and intangibles amortization expense.

It excludes expenses that are not directly related to our revenue-generating operations such as restructuring charges and legal contingency accruals.

It excludes loss on extinguishment of debt as these expenses were incurred as a result of decisions made by management to repay portions of our outstanding credit facilities early;

We calculate Adjusted Net Loss as GAAP net loss adjusted to exclude non-cash expenses of stock-based compensation, equity securities fair value adjustment, warrant fair value adjustment, and intangibles amortization expense.

It excludes expenses that are not directly related to our revenue-generating operations such as restructuring and legal contingency accruals.

It excludes (gain) loss on extinguishment of debt as these expenses or gains were incurred as a result of decisions made by management to repay portions of our outstanding credit facilities and the 0.25% convertible senior notes due in 2026 (the "2026 Notes") early;

these expenses are not reflective of ongoing operating results and vary in frequency and amount.

It also excludes non-recurring payroll tax on initial RSU release, gain on lease termination, goodwill impairment and convertible note payment-in-kind (“PIK”) interest and issuance discount amortization.

It also excludes non-recurring payroll tax on initial RSU release, and goodwill impairment.

Adjusted Net Loss also aligns the timing of inventory valuation adjustments recorded under GAAP to the period in which the related revenue is recorded in order to improve the comparability of this measure to our non-GAAP financial measures of unit economics, as described above.

Our calculation of Adjusted Net Loss does not currently include the tax effects of the non-GAAP adjustments because our taxes and such tax effects have not been material to date.

Adjusted EBITDA

Adjusted EBITDA / Margin

We calculated Adjusted EBITDA as Adjusted Net Loss adjusted for depreciation and amortization, property financing and other interest expense, interest income, and income tax expense.

Adjusted EBITDA is a supplemental performance measure that our management uses to assess our operating performance and the operating leverage in our business.

Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of revenue.

OPENDOOR TECHNOLOGIES INC.

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(in millions, except percentages) 2023 2022 2021

Revenue (GAAP) $ 6,946 $ 15,567 $ 8,021

Net loss (GAAP) $ (275) $ (1,353) $ (662)

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Equity securities fair value adjustment (1)

Derivative and warrant fair value adjustment (1)

Warrant fair value adjustment (1)

Intangibles amortization expense (2)

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Restructuring (6)

Convertible note PIK interest and discount amortization (7)

Loss on extinguishment of debt 25 — 11

Gain on lease termination — (5) —

(Gain) loss on extinguishment of debt

Goodwill impairment — 60 —

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Interest income (10)

(106) (22) (3)

Income tax expense 1 2 1

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(5) Inventory valuation adjustment — Prior Periods is the inventory valuation adjustments recorded in prior periods associated with homes that sold in the period presented.

(6) Restructuring costs consist mainly of employee termination benefits, relocation packages and bonuses as well as costs related to the exiting of certain non-cancelable leases.

(7) Includes non-cash payment-in-kind (“PIK”) interest and amortization of the discount on the convertible notes issued from July through November 2019 (the “2019 Convertible Notes”).

We exclude convertible note PIK interest and amortization from Adjusted Net Loss since these are non-cash in nature and were converted into equity in September 2020 when the Company entered into the Convertible Notes Exchange Agreement with the convertible note holders.

(6) Restructuring costs consist primarily of severance and employee termination benefits and bonuses.

(7) Includes primarily gain or loss on the sale of available for sale securities, sublease income, income from equity method investments, and gain on lease termination.

(8) Includes interest expense on our non-recourse asset-backed debt facilities.

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios, or as noted)

(8) Includes primarily gain or loss on interest rate lock commitments, gain or loss on the sale of available for sale securities, sublease income, and income from equity method investments.

(9) Includes interest expense on our non-recourse asset-backed debt facilities.

(10) Includes amortization of debt issuance costs and loan origination fees, commitment fees, unused fees, other interest related costs on our asset-backed debt facilities, interest expense related to the 2026 convertible senior notes outstanding, and interest expense on other secured borrowings.

(11) Consists mainly of interest earned on cash, cash equivalents and marketable securities.

(9) Includes amortization of debt issuance costs and loan origination fees, commitment fees, unused fees, other interest related costs on our asset-backed debt facilities, interest expense related to the 2026 Notes outstanding, and interest expense on other secured borrowings.

(10) Consists mainly of interest earned on cash, cash equivalents, restricted cash and marketable securities.

Components of Our Results of Operations

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Real estate inventory is reviewed for valuation adjustments at least quarterly.

If the carrying amount or basis is not expected to be recovered, an inventory valuation adjustment is recorded to cost of revenue and the related assets are adjusted to their net realizable value.

If the carrying amount for a given home is not expected to be recovered, an inventory valuation adjustment is recorded to cost of revenue and the home’s carrying value is adjusted to its net realizable value.

Additionally, for our revenue other than home sales revenue, cost of revenue consists of any costs incurred in delivering the service, including associated headcount expenses such as salaries, benefits and stock-based compensation.

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Technology and Development Expense

Technology and development expense consists primarily of headcount expenses, including salaries, benefits and stock-based compensation for employees in the design, development, testing, maintenance and operation of our websites, tools, applications, and mobile apps that support our products.

Technology and development expense also includes amortization of capitalized software development costs.

Technology and development expense consists primarily of headcount expenses, including salaries, benefits and stock-based compensation for employees in the design, development, testing, maintenance and operation of our mobile applications, websites, tools, applications, and mobile apps that support our products.

Technology and development expense also includes amortization of capitalized software development costs and third-party software and hosting costs.

Goodwill Impairment Expense

Goodwill impairment expense consists of impairment charges recorded as a result of goodwill impairment testing.

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios, or as noted)

Goodwill Impairment Expense

Goodwill impairment expense consists of impairment charges recorded as a result of goodwill impairment testing.

Restructuring Expense

Restructuring expense consists primarily of severance and other termination benefits for employees whose roles have been eliminated as well as costs related to the exiting of certain non-cancelable leases with no future benefits to the Company.

Derivative and Warrant Fair Value Adjustment

Derivative and warrant fair value adjustment consists of unrealized and realized gains and losses as a result of marking our warrants and embedded derivatives related to the 2019 Convertible Notes to fair value at the end of each reporting period and subsequent settlement through exercise of warrants and conversion of the 2019 Convertible Notes to equity.

Loss on Extinguishment of Debt

Loss on extinguishment of debt is the result of the Company’s partial or full termination of a debt facility and is comprised of amounts paid to the lenders in excess of the book basis, as well as unamortized deferred costs associated with the facility.

Restructuring expense consists primarily of severance and other termination benefits for employees whose roles have been eliminated.

Warrant Fair Value Adjustment

Warrant fair value adjustment consists of unrealized and realized gains and losses as a result of marking our warrants to fair value at the end of each reporting period and subsequent settlement through exercise of warrants to equity.

Gain (Loss) on Extinguishment of Debt

Gain (loss) on extinguishment of debt is primarily related to the Company’s partial repurchase of the 2026 Notes at a discount net of unamortized deferred costs associated with the 2026 Notes.

Gain on extinguishment of debt also includes any gains or losses recognized in conjunction with the termination of debt facilities, partial debt extinguishments, and unamortized deferred costs associated with these facilities.

See “ Part II – Item 8.

Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 5.

Credit Facilities and Long-Term Debt—Convertible Senior Notes” for additional information regarding the 2026 Notes.

Interest Expense

Interest expense consists primarily of interest paid or payable and the amortization of debt discounts and debt issuance costs.

Interest expense varies period over period, primarily due to fluctuations in our inventory volumes and changes in the Benchmark Rates, which impact the interest incurred on our senior revolving credit facilities (see “— Liquidity and Capital Resources — Debt and Financing Arrangements ”).

Interest expense varies period over period, primarily due to fluctuations in our inventory volumes and changes in the floating benchmark interest rates (“Benchmark Rates”), based on a London Interbank Offered Rate (“LIBOR”) for certain periods prior to December 31, 2022 or the secured overnight financing rate (“SOFR”), plus an applicable margin, which impact the interest incurred on our senior revolving credit facilities (see “— Liquidity and Capital Resources — Debt and Financing Arrangements ”).

We expect our overall interest expense to increase as inventory increases.

Subject to market conditions and cost of capital trade-offs, we will evaluate opportunities to expand our sources of financing over time, which may allow us to diversify our mix of financing sources to include more cost effective financing relative to our higher cost mezzanine term debt facilities.

Other (Loss) Income — Net

Other (loss) income-net consists primarily of changes in fair value of, and dividend income, from our investment in equity securities as well as interest income from our investment in money market funds, time deposits, and debt securities.

Other Income (Loss) — Net

Other income (loss) – net consists primarily of interest income on our Cash and Restricted cash balances and from our investment in money market funds, time deposits, and debt securities as well as changes in fair value of, and dividend income, from our investment in equity securities.

Income Tax Expense

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Goodwill impairment — 60 (60) N/M

Restructuring 17 — 17 N/M

Restructuring 14 17 (3) (18) %

Total operating expenses 873 1,598 (725) (45) %

Net operating loss (386) (931) 545 (59) %

Derivative and warrant fair value adjustment — 12 (12) (100) %

Loss on extinguishment of debt (25) — (25) N/M

Gain (loss) on extinguishment of debt

216 (25) 241 N/M

Interest expense (211) (385) 174 (45) %

Other (loss) income-net (10) 38 (48) (126) %

Other income (loss)-net

107 (10) 117 N/M

Loss before income taxes (274) (1,351) 1,077 (80) %

2 unchanged sentences

N/M - Not meaningful.

Revenue increased by $7.5 billion, or 94%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase in revenue was primarily attributable to higher sales volumes as well as higher revenue per home.

We sold 39,183 homes during the year ended December 31, 2022, compared to 21,725 homes during the year ended December 31, 2021, representing an increase of 80%.

Revenue per home sold increased 8% between periods due to inventory mix, buybox expansion and home price appreciation.

Revenue decreased by $8.6 billion, or 55%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The decrease in revenue was primarily attributable to lower sales volumes as well as lower revenue per home.

We sold 18,708 homes during the year ended December 31, 2023, compared to 39,183 homes during the year ended December 31, 2022, representing a decrease of 52%.

Revenue per home sold decreased 7% between the same periods.

The decrease in sales volumes was a result of the proactive reduction of our inventory acquisition pace beginning in the third quarter of 2022 via higher spreads embedded in our offers and lower marketing investment in reaction to volatility in the U.S.

housing market.

The decrease in revenue per home sold was primarily attributed to a slowdown in home price appreciation (“HPA”).

Cost of Revenue and Gross Profit

Cost of revenue increased by $7.6 billion, or 104%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase in cost of revenue was primarily attributable to higher sales volumes and a 13% increase in cost of revenue per home, excluding inventory valuation adjustments, as a result of inventory mix, buybox expansion, and home price appreciation at the time of inventory acquisition.

In addition, we recorded $458 million of inventory valuation adjustments during the year ended December 31, 2022 to adjust the cost basis of homes remaining in inventory at December 31, 2022 to their net realizable value as compared to $39 million of inventory valuation adjustments during the year ended December 31, 2021.

Gross profit decreased from $730 million to $667 million and gross margin decreased from 9.1% to 4.3% for the year ended December 31, 2021 and December 31, 2022, respectively.

For the same periods, Adjusted Gross Margin decreased from 9.6% to 7.0%.

The decrease in gross margin and Adjusted Gross Margin reflects our decision to prioritize risk management and resale clearance in the second half of 2022 at the expense of resale margin performance.

As a result of the fast downturn in the housing market due to macroeconomic conditions, market conditions at the time of sale were weaker than we believed they would be at the time of pricing our inventory acquisitions.

In addition, gross margin and Adjusted Gross Margin for the year ended December 31, 2021 benefited from a fresh book of inventory after we sold down our inventory in response to the COVID-19 pandemic and more favorable macroeconomic conditions as compared to the year ended December 31, 2022.

Cost of revenue decreased by $8.4 billion, or 57%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The decrease in cost of revenue was primarily attributable to lower sales volumes and a 9% decrease in cost of revenue per home, excluding inventory valuation adjustments on homes in inventory at period end, due to the slowdown in inventory acquisition pacing and HPA discussed above.

In addition, the decrease in cost of revenue is attributable to a decrease in inventory valuation adjustments on homes in inventory at period end, which were $23 million for the year ended December 31, 2023 compared to $458 million for the year ended December 31, 2022.

The decrease in inventory valuation adjustments reflects the relative home price stabilization experienced in 2023 as well as higher spreads embedded in our home acquisition offers.

Gross profit decreased from $667 million to $487 million and gross margin increased from 4.3% to 7.0% for the years ended December 31, 2022 and December 31, 2023, respectively.

The decrease in gross profit is attributable to lower sales volumes as discussed above as well as the strong margins realized during the first half of the year ended December 31, 2022, which were fueled by a historically strong U.S.

housing market at the start of the year.

The increase in gross margin for the year ended December 31, 2023 compared to the year ended December 31, 2022 is attributable to $737 million in inventory valuation adjustments recorded during the year ended December 31, 2022 to reduce homes in inventory to their net realizable value

OPENDOOR TECHNOLOGIES INC.

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Contribution Margin decreased from 6.5% to 3.4% for the same periods, due to the reasons noted above as well as due to increased direct selling and holding costs.

See “— Non-GAAP Financial Measures .”

following the rapid downturn in the U.S.

housing market, beginning primarily in the second half of 2022.

This included $458 million of inventory valuation adjustments on homes remaining in inventory at December 31, 2022.

For the same periods, Adjusted Gross Margin, which aligns the timing of inventory valuation adjustments to the period in which the home is sold, decreased from 7.0% to 0.8%.

The decrease in Adjusted Gross Margin reflects the downturn in the U.S.

housing market in the second half of 2022, resulting in market conditions at the time of resale to be weaker than we believed they would be at the time of pricing our inventory acquisitions.

In addition, we prioritized risk management and resale clearance at the expense of resale margin performance in order to clear the old book inventory, which composed a majority of the resale cohort for the year ended December 31, 2023.

Contribution Margin decreased from 3.4% to (3.7)% for the years ended December 31, 2022 and December 31, 2023, respectively, due to the reasons noted above as well as increased holding costs due to longer average inventory holding periods.

Contribution Margin and Adjusted Gross Margin are non-GAAP financial measures.

See “— Non-GAAP Financial Measures ” for further details and a reconciliation of such non-GAAP measures to their nearest comparable GAAP measures.

Operating Expenses

Sales, Marketing and Operations .

Sales, marketing and operations increased by $462 million, or 85%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily attributable to a $219 million increase in resale transaction costs and broker commissions, consistent with the 94% increase in revenue.

Property holding costs increased by $91 million, consistent with increased inventory levels and longer inventory holding periods compared to the year ended December 31, 2021 when we held a fresh book of inventory.

Advertising expense increased by $77 million, from $123 million for the year ended December 31, 2021 to $200 million for the year ended December 31, 2022 as we increased marketing to drive acquisition volumes in both existing and new markets.

Headcount expenses, including salaries and benefits, increased $50 million consistent with the increase in headcount.

Sales, marketing and operations decreased by $520 million, or 52%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The decrease was primarily attributable to a $217 million decrease in resale transaction costs and broker commissions, consistent with the 55% decrease in revenue during the same period.

Property holding costs decreased by $116 million, consistent with decreased inventory levels.

Advertising expense decreased by $125 million, from $200 million for the year ended December 31, 2022 to $75 million for the year ended December 31, 2023 as we decreased marketing in both existing and new markets.

In addition, headcount expenses, including salaries and benefits, decreased $58 million, which was largely attributable to workforce reductions and a reduction in contingent labor in 2023.

General and Administrative .

General and administrative decreased by $140 million, or 40%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The decrease was primarily attributable to $354 million reduction in stock-based compensation due to the expense recognition of certain performance awards during the year ended December 31, 2021 following the consummation of the Business Combination in December 2020, the expense recognition of certain RSUs upon the fulfillment of the liquidity event vesting condition satisfied by the February 2021 Offering and the reversal of expense in December 2022 related to the forfeiture of certain executive performance awards.

The reduction in stock-based compensation was partially offset by a $46 million legal contingency accrual and related expenses recorded during the year ended December 31, 2022 in connection with the FTC consent order finalized in October 2022.

Headcount expenses, including salaries and benefits increased $21 million consistent with the increase in headcount.

The decrease was primarily attributable to $46 million reduction in stock-based compensation, which was primarily related to the forfeiture of certain executive RSUs, including performance-based awards.

In addition, the Company recorded a $46 million legal contingency accrual and related expenses recorded during the year ended December 31, 2022 in connection with the FTC consent order finalized in October 2022.

Headcount expenses, including salaries and benefits decreased $19 million, which was primarily attributable to workforce reductions in 2023.

Technology and Development .

Technology and development increased by $35 million, or 26%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily attributable to a $26 million increase in headcount expenses, including salaries and benefits, consistent with the increase in headcount.

Technology and development decreased by a nominal amount for the year ended December 31, 2023 compared to the year ended December 31, 2022.

Goodwill Impairment .

Goodwill impairment increased by $60 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

Goodwill impairment decreased by $60 million for the year ended December 31, 2023 compared to the year ended December 31, 2022.

During the fourth quarter of 2022, the market price of our common stock declined significantly causing the Company to perform an interim quantitative test for goodwill impairment.

Based on the quantitative analysis, the Company recorded a goodwill impairment charge of $60 million for the year ended December 31, 2022.

There was no impairment of goodwill identified for the years ended December 31, 2021 and 2020.

There was no impairment of goodwill identified for the year ended December 31, 2023.

Restructuring.

Restructuring increased by $17 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The restructuring expenses recorded in the year ended December 31, 2022, represented severance, and other termination benefits for employees whose roles were eliminated, and other restructuring costs related to winding down the Company’s mortgage lending and brokerage services.

Derivative and Warrant Fair Value Adjustment

Derivative and warrant fair value adjustment decreased by $12 million, or 100%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The gain recorded in the year ended December 31, 2021 was attributable to a decrease in the fair value of the Sponsor Warrants between the time of the Business Combination and the completion of their redemption in July 2021.

Loss on Extinguishment of Debt

Loss on extinguishment of debt increased by $25 million, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The loss on extinguishment of debt of $25 million in December 31, 2022 resulted from the Company’s voluntary partial early repayment of an asset-backed mezzanine term debt facility.

Interest Expense

Interest expense increased by $242 million, or 169%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily attributable to increases in the average outstanding balances of our asset-

Restructuring decreased by a nominal amount for the year ended December 31, 2023 compared to the year ended December 31, 2022.

Gain (Loss) on Extinguishment of Debt

Gain (loss) on extinguishment of debt increased by $241 million, for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The gain on extinguishment of debt of $216 million in December 31, 2023 resulted from the Company’s partial repurchase of its 2026 Notes in 2023 at a discount net of unamortized deferred costs associated with the 2026 Notes, partially offset by expenses related to partial debt extinguishments during the year ended December 31, 2023.

OPENDOOR TECHNOLOGIES INC.

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backed senior debt facilities and mezzanine term debt facilities, which is consistent with our increase in inventory over the same periods.

In addition, interest expense from our asset-backed senior revolving credit facilities, which bear interest at a floating reference rate based on LIBOR or SOFR, has increased due to higher reference rates during the year ended December 31, 2022 compared to the year ended December 31, 2021.

Other (Loss) Income — Net

Other (loss) income – net decreased by $48 million, or 126%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The decrease is primarily related to the fair value adjustments recorded on marketable equity securities.

The Company recorded a $35 million gain in 2021 when a company in which we invested went public and then recorded a $35 million loss in 2022 when the company’s stock price declined.

The fair value loss recorded in 2022 is offset by a $20 million increase in interest income due to higher interest rates during the year ended December 31, 2022 compared to the year ended December 31, 2021.

During 2022, the terms of certain of our asset-backed senior revolving credit facilities were modified to replace LIBOR-based floating reference rates with SOFR-based floating reference rates.

As of December 31, 2022, all such floating reference rates in our asset-backed senior revolving credit facilities were based on SOFR.

Interest Expense

Interest expense decreased by $174 million, or 45%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The decrease was primarily attributable to a significant decrease in the average outstanding balances of our non-recourse asset-backed debt.

Other Income (Loss) — Net

Other income (loss) – net increased by $117 million for the year ended December 31, 2023 compared to the year ended December 31, 2022.

The increase is primarily related to an $84 million increase in interest income due to an increase in interest rates and a $4 million unrealized gain versus a $35 million unrealized loss on marketable equity securities during the year ended December 31, 2023 and December 31, 2022, respectively.

Income Tax Expense

Income tax expense increased by a nominal amount for the year ended December 31, 2022 compared to the year ended December 31, 2021.

Income tax expense decreased by a nominal amount for the year ended December 31, 2023 compared to the year ended December 31, 2022.

Year Ended December 31, 2022 Compared to Year Ended December 31, 2021

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Technology and development 169 134 35 26 %

Restructuring — 29 (29) (100) %

Goodwill impairment 60 — 60 N/M

Restructuring 17 — 17 N/M

Total operating expenses 1,598 1,298 300 23 %

Net operating loss (931) (568) (363) 64 %

Derivative and warrant fair value adjustment 12 8 4 50 %

Loss on extinguishment of debt — (11) 11 (100) %

Warrant fair value adjustment

— 12 (12) (100) %

Loss on extinguishment of debt (25) — (25) N/M

Interest expense (385) (143) (242) 169 %

Other income-net 38 4 34 850 %

Other (loss) income-net

(10) 38 (48) (126) %

Loss before income taxes (1,351) (661) (690) 104 %

Income tax expense (1) — (1) N/M

Income tax expense (2) (1) (1) 100 %

Net loss $ (1,353) $ (662) $ (691) 104 %

1 unchanged sentence

Revenue increased by $7.5 billion, or 94%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase in revenue was primarily attributable to higher sales volumes in 2021 compared to 2020, as well as higher revenue per home.

We sold 21,725 homes during the year ended December 31, 2021, compared to 9,913 homes during the year ended December 31, 2020, representing an increase of 119%, while revenue per home sold increased 42% between periods.

The higher sales volumes are a reflection of growing market share in existing markets and, to a lesser extent,

The increase in revenue was primarily attributable to higher sales volumes as well as higher revenue per home.

We sold 39,183 homes during the year ended December 31, 2022, compared to 21,725 homes during the year ended December 31, 2021, representing an increase of 80%.

Revenue per home sold increased 8% between periods due to inventory mix, buybox expansion and home price appreciation.

OPENDOOR TECHNOLOGIES INC.

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our expansion into new markets.

We successfully grew our inventory levels throughout 2021, allowing us to sell-through significantly more homes relative to 2020, when we had much lower inventory levels due to our temporary pause in home purchases at the start of the COVID-19 pandemic.

Average resale prices were positively impacted by price mix within markets, overall home price appreciation and buybox expansion.

Cost of Revenue and Gross Profit

Cost of revenue increased by $7.6 billion, or 104%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This increase in cost of revenue was primarily attributable to higher sales volumes and a 41% increase in cost of revenue per home as a result of inventory mix, home price appreciation and buybox expansion.

Gross margin improved from 8.5% to 9.1% for the year ended December 31, 2020 and December 31, 2021, respectively.

For the same periods, Adjusted Gross Margins improved from 8.2% to 9.6%.

The gross margin increase was primarily due to a combination of higher resale prices relative to our net purchase price for homes, repair and renovation efficiencies, and the effectiveness of our inventory resale systems.

Contribution Margin increased from 4.3% to 6.5% for the same periods, due largely to higher Adjusted Gross Margins as well as improvements in direct selling and holding costs.

See “— Non-GAAP Financial Measures .”

Gross profit decreased from $730 million to $667 million and gross margin decreased from 9.1% to 4.3% for the year ended December 31, 2021 and December 31, 2022, respectively.

For the same periods, Adjusted Gross Margin decreased from 9.6% to 7.0%.

The decrease in gross margin and Adjusted Gross Margin reflects our decision to prioritize risk management and resale clearance in the second half of 2022 at the expense of resale margin performance.

Contribution Margin decreased from 6.5% to 3.4% for the same periods, due to the reasons noted above as well as due to increased direct selling and holding costs.

Contribution Margin and Adjusted Gross Margin are non-GAAP financial measures.

See “— Non-GAAP Financial Measures ” for further details and a reconciliation of such non-GAAP measures to their nearest comparable GAAP measure.

Operating Expenses

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Sales, marketing and operations increased by $462 million, or 85%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily attributable to a $123 million increase in resale transactions costs and broker commissions, consistent with the 119% increase in the number of homes sold.

In addition, advertising expense increased by $90 million as we increased marketing to drive acquisition volumes in both existing and new markets launched in 2021, relative to the limited marketing spend in 2020 due to the onset of COVID-19.

Property holding costs increased by $71 million consistent with increased inventory levels.

Personnel expenses, including salaries and benefits increased $28 million consistent with the increase in headcount.

The increase was primarily attributable to a $219 million increase in resale transaction costs and broker commissions, consistent with the 94% increase in revenue.

Headcount expenses, including salaries and benefits, increased $50 million consistent with the increase in headcount.

General and Administrative .

General and administrative increased by $488 million, or 370%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily attributable to $430 million of additional stock-based compensation from the commencement of expense recognition of certain performance awards following the consummation of the Business Combination in December 2020 as well as the expense recognition of certain RSUs upon the fulfillment of the liquidity event vesting condition satisfied by the February 2021 Offering.

Personnel expenses, including salaries and benefits increased $22 million consistent with the increase in headcount.

General and administrative decreased by $274 million, or 44%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

Headcount expenses, including salaries and benefits increased $21 million consistent with the increase in headcount.

Technology and Development .

Technology and development increased by $35 million, or 26%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily attributable to an $56 million increase in stock-based compensation reflecting both an increase in headcount as well as the recognition of stock-based compensation beginning in 2021 when the February 2021 Offering satisfied the liquidity event vesting condition of certain RSUs.

Personnel expenses, including salaries and benefits increased $12 million consistent with the increase in headcount.

The increase was primarily attributable to a $26 million increase in headcount expenses, including salaries and benefits, consistent with the increase in headcount.

Goodwill Impairment .

Goodwill impairment increased by $60 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

During the fourth quarter of 2022, the market price of our common stock declined significantly causing the Company to perform an interim quantitative test for goodwill impairment.

Based on the quantitative analysis, the Company recorded a goodwill impairment charge of $60 million for the year ended December 31, 2022.

There was no impairment of goodwill identified for the year ended December 31, 2021.

Restructuring.

Restructuring decreased by $29 million for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The restructuring expenses recorded in the year ended December 31, 2020, represent severance, and other termination benefits for employees whose roles were eliminated, and other restructuring costs related to the exiting of certain non-cancelable leases with no future benefit to the Company.

Derivative and Warrant Fair Value Adjustment

Derivative and warrant fair value adjustment increased by $4 million, or 50% for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The adjustments recorded in the years ended December 31, 2020 and December 31, 2021 were primarily attributable to a gains of $34 million and $12 million, respectively, due to a decrease in the fair value of the Sponsor Warrants between the time of the Business Combination and the completion of their redemption in July 2021.

The gains recorded for the year ended December 31, 2020 were offset by a $23 million increase in the fair value of a derivative liability in extinguishment of the Company's 2019 Convertible Notes.

Restructuring increased by $17 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The restructuring expenses recorded in the year ended December 31, 2022, represented severance, and

OPENDOOR TECHNOLOGIES INC.

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other termination benefits for employees whose roles were eliminated, and other restructuring costs related to winding down the Company’s mortgage lending and brokerage services.

Warrant Fair Value Adjustment

Warrant fair value adjustment decreased by $12 million, or 100%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The gain recorded in the year ended December 31, 2021, was attributable to a decrease in the fair value of the Sponsor Warrants between the time of the Business Combination and the completion of their redemption in July 2021.

Loss on Extinguishment of Debt

Loss on extinguishment of debt decreased by $11 million, or 100%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The loss on extinguishment of debt of $11 million in 2020 resulted from the Company’s early termination of one of its mezzanine term debt facilities.

The Company did not have any meaningful losses on extinguishment of debt during the year ended December 31, 2021.

Loss on extinguishment of debt increased by $25 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The loss on extinguishment of debt of $25 million in December 31, 2022 resulted from the Company’s voluntary partial early repayment of an asset-backed mezzanine term debt facility.

Interest Expense

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The increase was primarily attributable to increases in the average outstanding balances of our asset-backed senior debt facilities and mezzanine term debt facilities, which is consistent with our increase in inventory over the same periods.

The increase in interest expense from our asset-backed credit facilities was partially offset by a $8 million decrease in interest expense and amortization of debt issuance costs related to the 2019 Convertible Notes, which were converted into equity in September 2020.

Other Income — Net

Other income – net increased by $34 million, or 850%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily related to the $35 million fair value adjustment on marketable equity securities recorded in 2021 when a company in which we invested went public.

Other (Loss) Income — Net

Other (loss) income – net decreased by $48 million, or 126%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The decrease was primarily related to the fair value adjustments recorded on marketable equity securities.

The Company recorded a $35 million gain in 2021 when a company in which we invested went public and then recorded a $35 million loss in 2022 when the company’s stock price declined.

During 2022, the terms of certain of our asset-backed senior revolving credit facilities were modified to replace LIBOR-based floating reference rates with SOFR-based floating reference rates.

As of December 31, 2022, all such floating reference rates in our asset-backed senior revolving credit facilities were based on SOFR.

Income Tax Expense

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As of December 31, 2023, we had cash and cash equivalents of $1.0 billion, restricted cash of $541 million, and marketable securities of $69 million.

The decline in our cash, cash equivalents and marketable securities balance of $934 million as compared to December 31, 2021 resulted from a combination of operating losses and borrowing less from our asset-backed senior revolving credit facilities relative to our real estate inventory as part of deleveraging of our inventory.

The decrease in our restricted cash balance of $193 million as compared to December 31, 2021 was a result of lower balances of resale proceeds being held in restricted cash accounts and the repayment of asset-backed debt.

The Company had total outstanding balances on our asset-backed debt of $4.4 billion and aggregate principal outstanding from the 2026 Notes of $978 million.

In addition, we had undrawn borrowing capacity of $7.5 billion under our non-recourse asset-backed debt facilities (as described further below), of which $2.3 billion was committed.

On February 9, 2021, we completed an underwritten public offering (the “February 2021 Offering”) in which we sold 32,817,421 shares of our common stock at a public offering price of $27.00 per share, including the exercise in full by the underwriters of their option to purchase up to 4,280,533 additional shares of common stock, which was completed on February 11, 2021.

We received aggregate net proceeds from the February 2021 Offering of approximately $859 million after deducting underwriting discounts and commissions and offering expenses payable by us.

In August 2021, we issued 0.25% convertible senior notes due in 2026 (the “2026 Notes”) with an aggregate principal amount of $978 million, which resulted in net proceeds after underwriting fees and other transactions costs of $953 million.

In connection with the issuance of the 2026 Notes, the Company purchased capped calls from certain financial institutions at a cost of $119 million.

As market conditions warrant, we may, from time to time, repurchase our outstanding debt securities in the open market, in privately negotiated transactions, by tender offer, by exchange transaction or otherwise.

Such repurchases, if any, will depend

The decline in our cash, cash equivalents and marketable securities balance of $213 million as compared to December 31, 2022 resulted from a combination of operating losses and the partial repurchase of our 2026 Notes, offset by capital released as a result of reduced inventory levels.

The decrease in our restricted cash balance of $113 million as compared to December 31, 2022 was largely a result of lower resale activity and lower outstanding balances in our term debt facilities in December 2023 as compared to December 2022.

As of December 31, 2023, the Company had total outstanding balances on our asset-backed debt of $2.2 billion and aggregate principal outstanding from convertible senior notes of $381 million.

In addition, we had undrawn borrowing capacity

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on prevailing market conditions, our liquidity and other factors and may be commenced or suspended at any time.

of $6.0 billion under our non-recourse asset-backed debt facilities (as described further below), of which $650 million was committed.

During the year ended December 31, 2023, the Company entered into separate, privately negotiated transactions to repurchase a portion of the outstanding 2026 Notes (“Repurchased 2026 Notes”).

We repurchased approximately $597 million in aggregate principal amount of our 2026 Notes as further described in “ Part II – Item 8.

Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Note 5.

Credit Facilities and Long-Term Debt – Convertible Senior Notes ” in this Annual Report on Form 10-K.

As market conditions warrant, we may, from time to time, repurchase additional outstanding debt securities in the open market, in privately negotiated transactions, by tender offer, by exchange transaction or otherwise.

Such repurchases, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity and other factors and may be commenced or suspended at any time.

The amounts involved and total consideration paid may be material.

We have incurred losses from inception through December 31, 2023 and expect to incur additional losses in the future.

Our ability to service our debt, fund working capital, business operations and capital expenditures will depend on our ability to generate cash from operating activities, which is subject to our future operating success, and obtain inventory acquisition financing on reasonable terms, which is subject to factors beyond our control, including general economic, political and financial market conditions.

Our ability to service our debt and fund working capital, business operations and capital expenditures will depend on our ability to generate cash from operating activities, which is subject to our future operating success, and ability to obtain inventory acquisition financing on reasonable terms, which is subject to factors beyond our control, including potential economic recession, rising interest rates, inflation and general economic, political and financial market conditions.

Our working capital requirements may increase should our inventory balance increase.

We believe our cash, cash equivalents, and marketable securities together with cash we expect to generate from future operations and borrowings, will be sufficient to meet our working capital and capital expenditure requirements for a period of at least twelve months from the date of this Annual Report on Form 10-K.

We believe our cash, cash equivalents, and marketable securities together with cash we expect to generate from future operations and borrowings, will be sufficient to meet our working capital and capital expenditure requirements for a period of at least 12 months from the date of this Annual Report on Form 10-K.

Debt and Financing Arrangements

Our financing activities include:

short-term borrowings under our asset-backed senior revolving credit facilities and, prior to the discontinuation of our mortgage origination business, our mortgage repurchase financing;

short-term borrowings under our asset-backed senior revolving credit facilities;

the issuance of long-term asset-backed senior term debt, asset-backed mezzanine term debt, and convertible debt;

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The maximum initial advance rates vary by facility and generally decrease on a fixed timeline that varies by facility based on the length of time a given property has been financed and other facility-specific adjustments, including adjustments based on collateral performance.

At times, we may be required to keep amounts in restricted cash accounts to collateralize our asset-backed term debt facilities if the property borrowing base is insufficient to satisfy the borrowing base requirements.

These amounts may fluctuate due to seasonality, timing of property acquisitions and resales, and the outstanding loan balances under our asset-backed term debt facilities.

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios,or as noted)

These amounts may fluctuate due to seasonality, timing of property acquisitions and resales, and the outstanding loan balances under our asset-backed term debt facilities.

The following table summarizes certain details related to our non-recourse asset-backed debt and other secured borrowings as of December 31, 2023 (in millions, except interest rates):

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Revolving Facility 2018-2 $ 1,000 $ — $ — 7.49 % June 30, 2025 June 30, 2025

Revolving Facility 2018-3 1,000 — — 6.82 % September 29, 2026 September 29, 2026

Revolving Facility 2019-1 300 — — 7.34 % August 15, 2025 August 15, 2025

Revolving Facility 2019-2 550 — — 6.83 % October 3, 2025 October 2, 2026

Revolving Facility 2019-1 900 55 — 4.41 % June 30, 2023 June 30, 2023

Revolving Facility 2019-2 1,850 167 — 3.92 % July 8, 2023 July 8, 2024

Revolving Facility 2019-3 925 — — — % April 5, 2024 April 4, 2025

Revolving Facility 2022-1 525 289 — 8.15 % December 31, 2022 October 31, 2023

Asset-backed Senior Term Debt Facilities

Term Debt Facility 2021-S1 400 — 400 3.48 % April 1, 2024 April 1, 2025

Term Debt Facility 2021-S2 600 — 500 3.20 % September 10, 2024 September 10, 2025

Term Debt Facility 2021-S3 1,000 — 750 3.75 % January 31, 2027

July 31, 2027

Term Debt Facility 2021-S1 100 — 100 3.48 % January 2, 2025 April 1, 2025

Term Debt Facility 2021-S2 400 — 300 3.20 % September 10, 2025 March 10, 2026

Term Debt Facility 2021-S3 1,000 — 750 3.75 % January 31, 2027 July 31, 2027

Term Debt Facility 2022-S1 250 — 250 4.07 % March 1, 2025 September 1, 2025

Term Debt Facility 2022-S2 500 200 — 8.48 % January 31, 2023 December 31, 2023

Total $ 5,525 $ — $ 1,400

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In some cases, the borrowing capacity amounts under the asset-backed senior revolving credit facilities as reflected in the table are not fully committed and any borrowings above the committed amounts are subject to the applicable lender’s discretion.

As of December 31, 2022, we had committed borrowing capacity with respect to asset-backed senior revolving credit facilities of $3.2 billion.

As of December 31, 2023, we had committed borrowing capacity with respect to asset-backed senior revolving credit facilities of $650 million.

The revolving period end dates and final maturity dates reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company.

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The carrying value of the non-current liabilities is reduced by issuance costs of $12 million.

In some cases, the borrowing capacity amounts under the asset-backed senior term debt facilities as reflected in the table are not fully committed and any borrowings above the committed amounts are subject to the applicable lender’s discretion.

As of December 31, 2022, we had committed borrowing capacity with respect to asset-backed senior term debt facilities of $2.1 billion.

In some cases, the borrowing capacity amounts under the asset-backed senior term debt facilities as reflected in the table are not fully committed and any borrowings above the

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios,or as noted)

committed amounts are subject to the applicable lender’s discretion.

As of December 31, 2023, we had committed borrowing capacity with respect to asset-backed senior term debt facilities of $1.4 billion.

The withdrawal period end dates and final maturity dates reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company.

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The borrowing capacity amounts under the asset-backed mezzanine term debt facilities as reflected in the table are not fully committed and any borrowing above the committed amounts are subject to the applicable lender’s discretion.

As of December 31, 2022, we had committed borrowing capacity with respect to asset-backed mezzanine term debt facilities of $1.2 billion.

Mortgage Financing

We primarily used debt financing to fund our mortgage loan originations.

In 2019, we entered into a master repurchase agreement(the “Repurchase Agreement”) to finance substantially all of the mortgage loans that we originated.

Once our mortgage business sold a loan in the secondary mortgage market, we used the sale proceeds to reduce the outstanding balance under the repurchase facility.

The Repurchase Agreement was terminated in October 2022.

As of December 31, 2023, we had committed borrowing capacity with respect to asset-backed mezzanine term debt facilities of $750 million.

Convertible Senior Notes

In August 2021, we issued the 2026 Notes with an aggregate principal amount of $978 million.

The table below summarizes certain details related to our 2026 Notes (in millions):

December 31, 2022 Aggregate Principal Amount

The table below summarizes certain details related to our 2026 Notes (in millions), as of December 31, 2023, which includes certain repurchases:

December 31, 2023 Remaining Aggregate Principal Amount

Unamortized Debt Issuance Costs Net Carrying Amount

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Special Purpose Entities

The Company established certain special purpose entities (“SPEs”) for the purpose of financing the Company’s purchase and renovation of real estate inventory through the issuance of asset-backed debt.

The Company has established certain special purpose entities (“SPEs”) for the purpose of financing the Company’s purchase and renovation of real estate inventory through the issuance of asset-backed debt.

The Company is the primary beneficiary of the various variable interest entities (“VIE”) within these financing structures and consolidates these VIEs.

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Marketable securities — 69 69

Escrow receivable 8 1 9

Real estate inventory 1,758 44 1,802

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CURRENT LIABILITIES:

Current senior revolver asset-backed debt 1,177 — 1,177

Current senior term asset-backed debt 199 — 199

Other current liabilities (2)

$ 29 $ 41 $ 70

Total current liabilities 29 41 70

Long term mezzanine asset backed debt 1,137 — 1,137

Long term senior term asset backed debt 1,883 — 1,883

Non-current asset-backed mezzanine term debt

Non-current asset-backed senior term debt

1,388 — 1,388

CONVERTIBLE SENIOR NOTES — 376 376

LEASE LIABILITIES – Net of current portion — 19 19

OTHER LIABILITIES

TOTAL LIABILITIES $ 2,163 $ 437 $ 2,600

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________________

(1) The Company’s consolidated other current assets include the following assets as shown in the Consolidated Balance Sheets:

Escrow Receivable, $30 million;

Other Current Assets $41 million.

(1) The Company’s consolidated Other Assets include the following assets as shown in the Consolidated Balance Sheets:

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and Other Assets, $22 million.

(3) The Company’s Other Current Liabilities include the following liabilities as shown in the Consolidated Balance Sheets:

(2) The Company’s consolidated Other Current Liabilities include the following liabilities as shown in the Consolidated Balance Sheets:

Accounts Payable and Other Accrued Liabilities, $64 million;

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Net Cash Provided by (Used in) Operating Activities

Net cash provided by (used in) operating activities was $730 million, $(5.8) billion and $682 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Net cash provided by (used in) operating activities was $2.3 billion, $730 million and $(5.8) billion for the years ended December 31, 2023, 2022 and 2021, respectively.

For the year ended December 31, 2023, cash provided by operating activities was primarily driven by a $2.6 billion decrease in real estate inventory, partially offset by our net loss, net of non-cash items, of $214 million.

For the year ended December 31, 2022, cash provided by operating activities was primarily driven by a $896 million decrease in real estate inventory.

For the year ended December 31, 2021, cash used in operating activities was primarily driven by a $5.7 billion increase in real estate inventory and an $83 million increase in escrow receivables correlated to the increase in revenue during the year.

For the year ended December 31, 2020, cash provided by operating activities was primarily driven by an $834 million reduction in real estate inventory offset by our net loss net of non-cash items of $149 million.

For the year ended December 31, 2021, cash used in operating activities was primarily driven by an $5.7 billion increase in real estate inventory and an $83 million increase in escrow receivables correlated to the increase in revenue during the year.

Net Cash Provided by (Used in) Investing Activities

Net cash provided by (used in) investing activities was $44 million, $234 million and $(476) million for the years ended December 31, 2023, 2022 and 2021, respectively.

For the year ended December 31, 2023, cash provided by investing activities primarily consisted of a $80 million net decrease in marketable securities, partially offset by a $37 million increase in property and equipment principally related to the capitalization of internally developed software.

For the year ended December 31, 2022, cash provided by investing activities primarily consisted of a $300 million net decrease in marketable securities, partially offset by a $37 million increase in property and equipment, and $19 million for strategic investments in certain privately held companies.

For the year ended December 31, 2021, cash used in investing activities primarily consisted of $394 million in investments in marketable securities, $33 million for the acquisitions of Pro.com and RedDoor, net of cash acquired, the $15 million purchase of strategic investments in certain privately held companies, and $33 million in capital expenditures, including internally developed software.

For the year ended December 31, 2020, cash used in investing activities primarily consisted of capital expenditures.

Net Cash (Used in) Provided by Financing Activities

Net cash (used in) provided by financing activities was $(1.8) billion, $7.3 billion and $161 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Net cash (used in) provided by financing activities was $(2.6) billion, $(1.8) billion and $7.3 billion for the years ended December 31, 2023, 2022 and 2021, respectively.

For the year ended December 31, 2023, cash used in financing activities was primarily attributable to $2.3 billion net principal payments on non-recourse asset-backed debt, as well as $362 million related to the partial repurchase of the 2026 Notes.

For the year ended December 31, 2022, cash used in financing activities was primarily attributable to $1.7 billion net principal payments on non-recourse asset-backed debt.

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In addition, we received $978 million in proceeds from the issuance of the 2026 Notes, net of $25 million of issuance costs and offset by $119 million purchase of the Capped Calls related to the 2026 Notes.

For the year ended December 31, 2020, cash provided by financing activities was primarily attributable to proceeds from the Business Combination and PIPE Investment in the amount of $1.0 billion, partially offset by the repayment of $816 million of our asset-backed debt and other secured borrowings.

OPENDOOR TECHNOLOGIES INC.

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(in millions) Total Less than

1 – 3 years 3 – 5 years More than

Senior revolving credit facilities (1)

$ 1,199 $ 1,199 $ — $ — $ —

1 – 3 years 4 – 5 years

Senior and mezzanine term debt facilities (1)

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Operating leases (3)

62 11 17 14 20

Purchase commitments (4)

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________________

(1) Represents the principal amounts outstanding as of December 31, 2022.

Includes estimated interest payments, calculated using the variable rate in existence at period end over an assumed holding period of 90 days.

Borrowings under the senior revolving credit facilities are payable as the related inventory is sold.

The payment is expected to be within one year of December 31, 2022.

(1) Represents the principal amounts outstanding as of December 31, 2023 and estimated interest payments assuming the principal balances remain outstanding until maturity.

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(3) Represents future payments for long-term operating leases that have commenced as of December 31, 2023.

In May 2023, the Company amended its Tempe, Arizona office lease to partially terminate the Company’s obligation with respect to a portion of the leased premises, which resulted in a decrease of undiscounted, future lease payments of $19 million.

(4) As of December 31, 2023, we were under contract to purchase 2,114 homes for an aggregate purchase price of $653 million.

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Inventory valuation

Inventory valuation adjustments are not offset by any expected gains and are not reversed or adjusted should the expected net realizable value subsequently increase.

For homes under resale contract, the net realizable value is the contract price less expected selling costs and any expected concessions.

For all other homes, the net realizable value is our internal projection price less expected selling

OPENDOOR TECHNOLOGIES INC.

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(Tabular amounts in millions, except share and per share data and ratios,or as noted)

adjustments are not offset by any expected gains and are not reversed or adjusted should the expected net realizable value subsequently increase.

For homes under resale contract, the net realizable value is the contract price less expected selling costs and any expected concessions.

For all other homes, the net realizable value is our internal projection price less expected selling costs.

Changes in our pricing assumptions may lead to a change in the outcome of our inventory valuation adjustment, and actual results may also differ from our assumptions.

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Under the accelerated attribution method, compensation expense is recognized over the remaining requisite service period for each service condition tranche as though each tranche is, in substance, a separate award.

In February 2021, the Company completed an underwritten public offering, which met the liquidity event vesting condition and triggered the recognition of compensation expense for

OPENDOOR TECHNOLOGIES INC.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular amounts in millions, except share and per share data and ratios,or as noted)

RSUs for which the time-based vesting condition had been satisfied or partially satisfied.

In February 2021, the Company completed an underwritten public offering, which met the liquidity event vesting condition and triggered the recognition of compensation expense for RSUs for which the time-based vesting condition had been satisfied or partially satisfied.

For further information on the February 2021 underwritten public offering, see “ Part II – Item 8.

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Shareholders’ Equity” .

OPENDOOR TECHNOLOGIES INC.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Tabular amounts in millions, except share and per share data and ratios,or as noted)

We determined the grant date fair value of RSUs with market-based vesting conditions by using Monte Carlo simulations.

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Share-Based Awards” .

Public and Sponsor Warrants

On April 30, 2020, SCH consummated its initial public offering (the “IPO”) of 41,400,000 units, consisting of one share of Class A common stock and one third of one warrant exercisable for Class A common stock, at a price of $10.00 per unit.

Each whole warrant entitles the holder to purchase one share of Class A common stock at an exercise price of $11.50 per share (the “Public Warrants”).

Simultaneously with the closing of the IPO, SCH completed the private placement of 6,133,333 warrants to SCH’s sponsor at a price of $1.50 per warrant (the “Sponsor Warrants”).

Each Sponsor Warrant allowed the sponsor to purchase one share of Class A common stock at $11.50 per share.

The Sponsor Warrants and shares of common stock issuable upon the exercise of Sponsor Warrants may not be transferred, assigned, or sold until 30 days after the completion of a business combination.

Additionally, the Sponsor Warrants are eligible for cash and cashless exercises, at the holder’s option, and are redeemable only if the Reference Value, as defined in the Warrant Agreement, is less than $18.00 per share.

We evaluated the Public and Sponsor Warrants under ASC 815-40, Derivatives and Hedging-Contracts in Entity’s Own Equity , and concluded that the Sponsor Warrants did not meet the criteria to be classified in shareholders’ equity.

Specifically the exercise and settlement features for the Sponsor Warrants precluded them from being considered indexed to the Company’s own stock given that a change in the holder of the Sponsor Warrants may alter the settlement of the Sponsor Warrants.

Since the holder of the instrument is not an input to a standard option pricing model, a consideration with respect to the indexation guidance, a change in the holder for the Sponsor Warrants impacting their value means the Sponsor Warrants are not indexed to the Company’s own stock.

Since the Sponsor Warrants meet the definition of a derivative under ASC 815, we recorded these warrants as liabilities on the balance sheet at fair value upon the consummation of the Business Combination, with subsequent changes in their respective fair values recognized in the consolidated statement of operations at each reporting period.

The Company concluded that the Public Warrants, which did not have the same exercise and settlement features as the Sponsor Warrants, meet the criteria to be classified in shareholders' equity.

On July 9, 2021, the Company completed the redemption of all of its outstanding Public and Sponsor Warrants and in connection with the redemption, the Public Warrants stopped trading on the Nasdaq Global Select Market.

Recent Accounting Pronouncements

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis