Offerpad Solutions (OPAD) - 2024 Q3 - Quarterly Results

Financial Performance - Net loss improved by 32% year-over-year to $13.5 million, while adjusted EBITDA improved by 53% to a loss of $6.2 million[2] - Revenue for Q3 2024 was $208.1 million, a decrease of 11% compared to $234.2 million in Q3 2023[4] - Net loss for the nine months ended September 30, 2024, was $44,834 thousand, compared to a net loss of $101,777 thousand for the same period in 2023[12] - Adjusted EBITDA for Q3 2024 was $(6,181,000), worsening from $(4,429,000) in Q2 2024 and $(13,278,000) in Q3 2023[31] - Net loss for Q3 2024 was $(13,537,000), an improvement from $(13,782,000) in Q2 2024 but worse than $(19,986,000) in Q3 2023[31] - Adjusted net loss for Q3 2024 was $(13,551,000), slightly better than $(13,773,000) in Q2 2024 and $(20,117,000) in Q3 2023[31] Sales and Operations - Homes acquired decreased by 55% year-over-year to 422, while homes sold decreased by 13% to 615[4] - The company expects to sell between 480 to 540 homes in Q4 2024, with projected revenue of $160 million to $185 million[5] - Homes sold decreased to 615 in Q3 2024 from 742 in Q2 2024 and 703 in Q3 2023, representing a decline of 17.1% quarter-over-quarter and 12.5% year-over-year[25] Profitability Metrics - Gross profit per home sold was $27,900, down 18% from $34,100 in Q3 2023[4] - Contribution profit after interest per home sold was $12,400, a decrease of 54% from $27,200 in Q3 2023[4] - Contribution profit for Q3 2024 was $12,531,000, down from $16,384,000 in Q2 2024 and $22,527,000 in Q3 2023, reflecting a decline of 23.5% quarter-over-quarter and 44.3% year-over-year[25] - Contribution margin for Q3 2024 was 6.0%, compared to 6.5% in Q2 2024 and 9.6% in Q3 2023, indicating a decrease in profitability[25] - Contribution profit per home sold for Q3 2024 was $20.4, down from $22.1 in Q2 2024 and $32.0 in Q3 2023, indicating reduced profitability per unit sold[25] Cash Flow and Expenses - Total operating expenses decreased by 40% to $26.1 million from $43.5 million in the prior year[2] - Cash and cash equivalents decreased by 54% year-over-year to $48.5 million[4] - Net cash used in operating activities was $12,404 thousand, a significant decrease from $276,955 thousand provided in the same period last year[12] - Cash and cash equivalents at the end of the period totaled $48,504 thousand, down from $105,999 thousand at the beginning of the period[12] - Total cash, cash equivalents, and restricted cash at the end of the period was $58,426 thousand, compared to $113,408 thousand at the end of the previous period[12] Inventory and Acquisitions - Renovate closed projects increased by 43% year-over-year to 227, generating $4.0 million in revenue[2] - Acquisitions from Offerpad's Agent Partnership Program grew to 33% of total acquisitions[2] - The company reported a real estate inventory valuation adjustment of $2,016 thousand for the nine months ended September 30, 2024[12] Financial Metrics and Comparisons - Adjusted gross profit for Q3 2024 was $18,820,000, compared to $23,295,000 in Q2 2024 and $24,808,000 in Q3 2023, indicating a decrease of 19.2% quarter-over-quarter and 24.2% year-over-year[25] - Gross profit for the three months ended September 30, 2024, was $17,140,000, down from $21,871,000 in the previous quarter, and $23,973,000 in the same quarter last year[25] - Gross margin for Q3 2024 was 8.2%, down from 8.7% in Q2 2024 and 10.2% in Q3 2023, showing a decline in operational efficiency[25] Non-GAAP Measures - Adjusted Gross Profit and Contribution Profit metrics are used to evaluate unit-level economics and operating performance across markets[15] - Contribution Profit After Interest is calculated by deducting interest expenses associated with homes sold during the period from Contribution Profit[22] - Offerpad's non-GAAP financial measures may not be comparable with those of other companies in the industry[14] - Offerpad emphasizes the importance of Adjusted Gross Profit as a measure of business performance, capturing gross margin performance isolated to homes sold in a given period[19]