What happened

After real estate technology company Zillow (Z -0.39%) (ZG -0.13%) decided to pull the plug on its money-losing iBuying business a couple of weeks ago, many investors grew concerned that other companies in that niche might be having similar problems. But leading iBuyer Opendoor Technologies (OPEN -6.09%) seems to have calmed investor fears for the time being with the third-quarter earnings report it released after the close Wednesday.

The numbers looked strong, especially considering that Zillow's iBuying business performed so poorly. And as of 10:42 a.m. EST on Thursday, Opendoor's stock was trading higher by more than 18%.

Family in front of house with sold sign.

Image source: Getty Images.

So what

For starters, Opendoor bought 15,181 homes in the third quarter. Not only did this exceed the company's own expectations, but it was more real estate than the four largest iBuyers bought in the second quarter combined.

Opendoor sold just under 6,000 homes during the quarter and ended September with 17,164 homes in inventory. Revenue came in at $2.3 billion, up 91% year over year, and gross margin was around 9%, which is right where it should be.

Now what

As a final point, here's where the difference between Opendoor and Zillow is most apparent -- profitability. Opendoor generated adjusted EBITDA of $35 million in the third quarter, while Zillow Offers delivered a $381 million adjusted EBITDA loss, mainly fueled by a writedown necessitated because it had overpaid on homes.

Not only is Opendoor scaling its business rapidly, it's doing so in a relatively efficient way. Investors needed to see that the iBuying business wasn't in imminent danger, and Opendoor definitely delivered. And that's what's driving such a positive move in the stock price.