Opendoor tanks after earnings as CEO thanks new investors for 'increased visibility'

In this articleOPEN your favorite stocksCREATE FREE ACCOUNTCourtesy: OpendoorWith Opendoor s up almost fivefold since the beginning of July and trading volumes hitting record levels, CEO Carrie Wheeler thanked investors for their "enthusiasm" on Tuesday's earnings call."I want to acknowledge the great deal of interest in Opendoor lately and that we're grateful for it," Wheeler said, even as the stock sank more than 20% after hours. "We appreciate your enthusiasm for what we're building, and we're listening intently to your back."Prior to its recent surge, Opendoor's stock had been mostly abandoned, falling as low as 51 cents in late June

The situation was so dire that the company was considering a reverse split that could lift the price of each by as much 50 times as a potential way to keep its Nasdaq listing

Opendoor said last week that it's back in compliance and canceled the reverse split posal.Opendoor's is centered around using nology to buy and sell s, pocketing the gains

But when interest rates began climbing in 2022, higher borrowing costs reduced demand for s.Revenue sank by two-thirds from $15.6 billion in 2022 to $5.2 billion last year.Much of the stock's bounce in the past six weeks was spurred by hedge fund manager Eric Jackson, who announced in July that his firm had taken a position in Opendoor

Jackson said he believes Opendoor's stock could eventually get to $82

For the second quarter, Opendoor reported a revenue increase of 4% to $1.57 billion

Opendoor said it expects to acquire just 1,200 s in the the third quarter, down from 1,757 in the second quarter and 3,504 in the third quarter of 2024

It's also pulling down marketing spending."The housing market has further deteriorated over the course of the last quarter," finance chief Selim Freiha said on Tuesday's earnings call. "Persistently high mortgage rates continue to suppress buyer demand, leading to lower ance and record new listings."Wheeler highlighted Opendoor's effort to expand its beyond so-called iBuying and into more of a referrals that's less capital intensive

She called it "the most important strategic shift in our history."Investors, who have been bidding up the stock in waves, were less than enthused with what they heard

But at least there are finally people listening."This increased visibility is an opportunity to tell our story to a broader audience," Wheeler said. "We intend to make the most of it."WATCH: Fed locked into September rate cutwatch now4:4204:42The Fed is locked into a September rate cut amid the weak jobs report, says One Point BFG's BoockvarFast Money