Opendoor Technologies Inc. (NASDAQ:OPEN) (the "Company"), a leading e-commerce platform for residential real estate transactions, today announced a series of transactions whose proceeds will add $440 million of growth capital to the balance sheet at a 0% coupon while reducing shares outstanding by 5%. The combined structure is designed so the Company expects no net share issuance until our stock exceeds $10.38 per share. Taken together, the Company believes the combined transactions enhance its capital structure, increase its capacity to fund profitable growth, and are structured to meaningfully limit dilution to existing shareholders.

The transactions consist of a $650 million offering of 0% Convertible Senior Notes due 2030 (the "Notes"), a $158 million repurchase of approximately 45.3 million shares of Opendoor common stock, and capped call transactions designed to reduce any potential dilution. The offering is expected to settle on August 19, 2026, subject to customary closing conditions.

Highlights:

  • 5% reduction in shares outstanding - the first share repurchase in Company history
  • $440 million growth capital at a 0% coupon through 2030
  • No expected net share issuance until $10.38 per share (and <5% even at $20 per share)
  • Structured to support disciplined expansion of inventory and growth beyond ANI profitability



     

"Capital should create value for existing shareholders - not come at their expense. This transaction gives us more than $400 million of growth capital at a 0% coupon, reduces our shares outstanding by 5%, and is structured so we expect no net share issuance until our stock is above $10 per share," said Kaz Nejatian, Chief Executive Officer of Opendoor. "How we finance growth matters as much as the growth itself."

"Quarter after quarter, we are executing against the promises we made. This capital gives us additional capacity to accelerate acquisitions and footprint while maintaining the capital discipline that got us here," Nejatian added.

Growth Capital

After using approximately $158 million of the offering proceeds for the share repurchase and approximately $52.5 million to fund the cost of entering into the capped call transactions, the Company expects to add approximately $440 million of net proceeds (before transaction expenses) to its balance sheet. The Company intends to use these proceeds to support disciplined expansion of home inventory and its market footprint, deploying additional capital into an operating model that the Company believes is on a clear path to sustained Adjusted Net Income profitability at current acquisition volumes.

The combined transactions are also structured to substantially limit potential dilution to existing shareholders. Assuming the Company elects to settle the principal amount of the Notes in cash, the capped call transactions are expected to offset potential share dilution from conversion through $6.98 per share. Above $6.98, the 45.3 million shares repurchased as part of the transaction are expected to offset net share issuance until the stock price exceeds $10.38 per share.

As a result, the combined transaction is expected to result in no net share issuance below approximately $10.38 per share and less than 5% net dilution at a share price of $20.00.

Share Repurchase

The Company intends to repurchase approximately 45.3 million shares of common stock for $158 million, or $3.49 per share, concurrently with the offering. This is the first share repurchase in the Company's history as a public company. The repurchase represents approximately 5% of the Company's shares outstanding as of July 28, 2026. The repurchase will be funded with proceeds from the offering and was authorized by the Company's Board of Directors on August 12, 2026.

In addition, J. Wood Capital Advisor LLC ("JWCA"), the placement agent for the offering, will purchase approximately $25 million of shares of the Company's common stock, at a discount to the last reported sale price per share of the Company's common stock on August 12, 2026, concurrently with the offering. Such repurchases by the Company and purchases by JWCA of shares of the Company’s common stock could increase (or reduce the size of any decrease in) the market price of the Company's common stock or the Notes.

Terms of the Notes

The Notes will be senior, unsecured obligations of the Company and will not bear regular interest, and the principal amount of the Notes will not accrete. The Notes will mature on August 15, 2030, unless earlier converted, redeemed or repurchased.

The Notes will have an initial conversion rate of 212.2466 shares of common stock per $1,000 principal amount of Notes, subject to adjustment in certain circumstances. This is equivalent to an initial conversion price of approximately $4.71 per share and represents a premium of approximately 35% over the last reported sale price of $3.49 per share of the Company's common stock on August 12, 2026.

Because the Company expects to settle the principal amount of converted Notes in cash and has entered into the concurrent share repurchase and capped call transactions, the initial conversion price of approximately $4.71 should not be viewed as the price at which the combined transaction begins to increase the Company's net share count.

Before February 15, 2030, the Notes will be convertible at the option of holders only upon satisfaction of certain conditions and during certain periods, and thereafter at any time until the close of business on the second scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash, shares of its common stock, or a combination of cash and shares, at the Company's election.

The Company may redeem the Notes, in whole or in part, on or after February 22, 2029 if the last reported sale price of the common stock exceeds 130% of the conversion price for a specified period, at a redemption price equal to 100% of principal plus accrued and unpaid interest, if any. The Company may also redeem the Notes in whole if less than $75 million aggregate principal amount remains outstanding.

Upon the occurrence of a fundamental change (as defined in the indenture governing the Notes), holders may require the Company to repurchase their Notes for cash at 100% of the principal amount, plus accrued and unpaid interest, if any. The Company will also be required to increase the conversion rate for holders who convert their Notes in connection with certain fundamental changes or a notice of redemption.

Capped Call Transactions

In connection with the pricing of the Notes, the Company entered into privately negotiated capped call transactions with certain financial institutions (the "option counterparties"). The capped call transactions are generally expected to reduce potential dilution to the common stock upon conversion of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, with such reduction and/or offset subject to a cap. The cap price of the capped call transactions is initially $6.98 per share, which represents a premium of 100% over the last reported sale price of $3.49 per share on August 12, 2026, and is subject to certain adjustments.

In connection with establishing their initial hedge positions with respect to the capped call transactions, the option counterparties and/or their respective affiliates expect to enter into various derivative transactions with respect to the Company's common stock and/or purchase shares of its common stock concurrently with or shortly after the Company's entry into the capped call transactions. This activity could increase (or reduce the size of any decrease in) the market price of the Company's common stock or the Notes at that time.

The Company used approximately $52.5 million of the net proceeds from the offering to fund the cost of the capped call transactions.