Shares in real estate technology company Opendoor Technologies (OPEN 2.40%) have been on a wild ride this year. The stock steadily declined throughout the first half of 2025, losing about 65% through June. But July was another story with shares skyrocketing 245%.
Opendoor stock reversed course this week, though, dropping nearly 20% at its low. As of early Friday, shares were still lower by 12% for the week, according to data provided by S&P Global Market Intelligence.
Image source: Getty Images.
Bubbles always burst
The recent story around Opendoor stock really hasn't been about its underlying business. Shares were dropping earlier in 2025 as the company reported declining revenue in a difficult housing market. Opendoor caught the eye of retail investors and traders who turned it into a meme stock in July.
More than 21% of the stock's float was held by short-sellers as of mid-July. That high short interest resulted in a short squeeze. But that bubble has now burst, shaving $1 billion from Opendoor's peak market cap last month.
NASDAQ: OPEN
Key Data Points
An improving housing environment
Opendoor reported improving second-quarter earnings this week. Revenue was back in growth mode compared to last year's second quarter, and was above the company's prior guidance. That wasn't enough to boost the stock, though, as Opendoor is still losing money, and the meme stock surge hasn't fully deflated.
Once that occurs, though, things could be looking up for Opendoor's business. A soft jobs report last week has improved the chances for Federal Reserve interest rate cuts. Mortgage rates have already dropped because of it, too.
For now, though, Opendoor says revenue will, in fact, decline sequentially in the third quarter. That might mean there's more downside in the near and medium term for Opendoor stock. Investors who rode the meme wave will likely continue to bail out.
Longer-term, a strong recovery in the housing market could help Opendoor reverse course with shares marching higher again. Though that probably won't be anytime soon.
