Opendoor Technologies Inc

Good day, and thank you for standing by. Welcome to the Open Door Technologies first quarter 2024 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Kimberly Niehaus, Investor Relations. Please go ahead.

Thank you and good afternoon. Details of our results and additional management commentary are available in our earnings release and shareholder letter, which can be found on the Investor Relations section of our website at investor.opendoor.com. Please note that this call will be simultaneously webcast on the Investor Relations section of the company's corporate website. Before we start, I would like to remind you that the following discussion contains forward looking statements within the meaning of the federal securities laws. All statements other than the statements of historical fact are statements that could be deemed forward looking, including but not limited to statements regarding open doors financial condition, anticipated financial performance, business strategy and plans, market opportunity and expansion, and management objectives for future operations. These statements are neither promises nor guarantees, and undue reliance should not be placed on them. Such forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those discussed here. Additional information that could cause actual results to differ from forward-looking statements can be found in the risk factor section of Opendoor's most recent annual report on Form 10-K for the year ended December 31, 2023, as updated by our periodic reports filed after that 10-K. Any forward-looking statements made on this conference call, including responses to your questions, are based on management's reasonable current expectations and assumptions as of today, and Open Door assumes no obligation to update or revise them, whether as a result of new information, future events, or otherwise, except as required by law. The following discussion contains references to certain non-GAAP financial measures. The company believes these non-GAAP financial measures are useful to investors as supplemental operational measurements to evaluate the company's financial performance. For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP metric, please see our website at investor.opendoor.com. I will now turn the call over to Carrie Wheeler, Chief Executive Officer of Opendoor.

Good afternoon. Also on the call with me today is Christy Schwartz, Interim Chief Financial Officer, and Dodd Frazier, President of Capital and Open Exchange. Our performance in the first quarter reflects our commitment to the three key operating principles we outlined at the beginning of the year, focus, execution, and results. Our north star remains rescaling our business and building towards a future of sustained profitable growth as we drive the business towards positive adjusted net income. We are making progress along this path with first quarter revenue, contribution profit, and adjusted EBITDA results all coming in ahead of our expectations. Further, We remain on track to meaningfully wrap acquisitions year on year each quarter in 2024 and deliver contribution margin within our target range of 5 to 7%. In the first quarter, we nearly doubled our acquisition volumes year over year. Contribution margin was 4.8% and excluding approximately 50 homes from the old book, our contribution margin was over 5%. Notably, this marks the seventh consecutive quarter that our new book of homes has generated contribution margin within or above our annual target margin range, demonstrating the health of our unit economics across seasons and market environments. We expect that our acquisition volume growth in 2024 will benefit from further expansion of our partnership channels. For example, at the end of February, our eXp Realty partnership went live, enabling eXp Realty's agents to easily request an open-door cash offer for their clients on qualifying properties. This partnership should continue to build on our brand awareness amongst agents and provide another way for sellers to learn about the benefits of working with Open Door. Earlier this year, details began to emerge on the proposed National Association of Realtors settlement. We believe this settlement represents an important positive change for our industry by giving consumers more transparency and choice on how they transact in the housing market. In the near term, we expect the settlement to have a neutral to positive impact on our business. As you've heard from us before, our business model does not rely on earning revenue from commissions paid to buyer's agents. Rather, those commissions are a cost to us today, which we pay when we resell our homes. Over the long term, we believe the settlement will drive lower transaction costs. And if commissions do decline, Opendoor may be able to pass these cost savings back to consumers in the form of lower spreads, which means more cash for our sellers and more customers saying yes will generate in the same margin. We also believe this settlement could result in more transactions as commissions decrease, which may encourage more consumers to transact directly, including through the Opendoors platform, instead of listing on the MLS. We believe that Opendoors stands to benefit as consumers rethink how they buy and sell homes. We've spent the last decade building for this future. We're off to a strong start in 2024 as we ramp our volumes in a sustainable and durable fashion. And during a time when the industry has the potential to undergo a major change in how consumers are thinking about how to sell or buy a home, we are very well positioned as the largest digital platform for residential real estate transactions. We're empowering consumers with more control and a simple, certain, and transparent offering during one of life's most important transactions. Christy will now review our financial results and guidance.