The iBuyer declined to confirm how many employees have been let go. Recent SEC filings show widespread cuts compared to a year earlier.
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Arizona-based iBuyer Offerpad confirmed it has laid off employees and restructured teams on Friday, days after it reported an ongoing slide in sales and revenue that drove its shares to all-time lows.
The company declined to comment on how many employees it was letting go, saying only that it was hoping to return to profitability.
“We’ve made some operational adjustments, including restructuring certain teams to better align with our strategic objectives,” an Offerpad spokesperson told Inman. “These changes are designed to enhance our efficiency while maintaining the core of our business — our cash offer.”
The company said it was focused on its automated valuation model that helps it price homes as part of its quick cash offer process.
“While we are not disclosing specific numbers regarding the number of people affected or the details of team adjustments, we can share that we have made strategic operational changes across multiple departments to enhance our operational efficiency and strengthen our core business offerings.”
In reporting second quarter earnings, Offerpad said it had reduced employee headcount in three areas: Sales, marketing and operations; general and administrative; and technology and development.
Offerpad reported slashing sales, marketing and operating expenses by $8.8 million, or 30 percent, during the second quarter — mostly by cutting advertising expenses by $7.4 million. Those efforts to reduce expenses were partially offset by an increase in variable costs associated with the increase in homes sold, the company said.
A $2.2 million reduction in general and administrative expenses was attributed to lower fees associated with credit facilities and headcount reductions, while the $1.3 million in cost cuts in technology and development were “primarily attributable to decreased average employee headcount.
Offerpad also wrote that it had cut its technology and development expenses by more than half, noting that the decrease was “primarily attributable to decreased average employee headcount.”
Offerpad’s $13.8 million second-quarter net loss was a 21 percent improvement from the first quarter, when the company was $17.5 million in the red, and a 38 percent reduction from its $22.3 million net loss in Q1 2023.
But revenue during the spring homebuying season was also down 12 percent from Q1, to $251.1 million, as home sales declined by 12 percent, to 742.
Offerpad said it expects Q3 revenue to continue to decline, to between $185 million and $225 million, and that home sales will drop to between 550 and 650.
“We’re committed to supporting our transitioning team members and have provided meaningful severance packages and support services,” the spokesperson said. “Our focus remains on leveraging our proprietary technology and market expertise to deliver exceptional value to our customers during this dynamic real estate market.”
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