Opendoor tumbles after Q3 report, $1.2 bln direct stock offering

Shares of online residential real estate firm Opendoor Technologies OPEN.O drop 16% to $5.51 early Fri after it reported Q3 results amid a change in strategy, and announced equity raise

Tempe, Arizona-based firm late Thurs reported rev fell by about one-third y/y to $915 mln and loss of 12 cents/sh; analysts had expected rev of $850 mln and loss of 7 cents/sh, per LSEG data

“We are refounding Opendoor as a software and AI company," CEO Kaz Nejatian said in the statement

“Our path to profitability is clear: transact with more sellers, strengthen our unit economics through better pricing and resale speed, and drive operational efficiency by being ruthless on expenses," Nejatian said

Early Fri, co sold ~180.6 mln shares in registered direct offering at $6.56 for about $1.18 bln gross proceeds to repurchase its outstanding 7% convertible notes due 2030

Late Thurs, co also announced a special dividend distribution of warrants to common stockholders as of 5:00 p.m. ET on Nov 18, saying to align shareholders and management

OPEN has ~772.8 mln shares outstanding for roughly $5 bln market cap, 10-Q filing shows

In Sept, OPEN appointed Shopify SHOT.TO executive Kaz Nejatian as its new CEO, and said co-founders Keith Rabois and Eric Wu will return to the board

OPEN, which has seen meme stock-like activity since the summer, hit intraday all-time low of 51 cents in late Jun