Opendoor Vents the Roof – WSJ

Zillow’s decision last year to jump out of this burning house is suddenly looking kind of smart.

Opendoor Technologies said Thursday that its automated home-flipping business sold 33% more homes than it had guided to in the third quarter but that the company made 20% less than it had forecast on the basis of adjusted earnings before interest, taxes, depreciation and amortization. Amid a sudden and strong real-estate market turn, the company made $573 million in “valuation adjustments” in the quarter alone on its homes in inventory. Those unrealized losses brought its statutory net loss to well over $900 million for the quarter—nearly three times larger than Wall Street had expected.