Offerpad Solutions Inc. Q1 FY2026 earnings call

• OfferPad has evolved from a single product company into a multi - solution real estate platform over the past two years, including Cash Offer, Cash Offer Marketplace, Brokerage Services, and Renovate.
• The macro environment has shifted with geopolitical uncertainty and higher interest rates, but OfferPad is positioned to operate effectively through diversified revenue streams, disciplined capital allocation, and AI - driven precision.
• Aged inventory has decreased, with less than 30 homes now compared to fewer than 60 at the end of Q4. They deployed buy - down mortgage rate incentives and moved to a post - inspection offer model for stronger transaction quality.
• Seller engagement with OfferPath is growing, and the multi - solution platform provides options for sellers when cash offers aren't suitable.
• AI is central to OfferPad's operations. Scout, an AI - powered homeowner intake and routing platform, improved home contracting rates by over 200 basis points after deployment in Q1. It also enhances call center operations and marketing demand generation. Henry, an AI - driven tool, is expanding capabilities for property inspection, renovation estimation, and decision - making across the portfolio.
• Each solution serves a distinct need, generates revenue, and strengthens the whole platform, improving conversion and reducing risk.

In Q1 2026, total revenue was $80 million across 263 transactions. Gross profit was $5.6 million, resulting in a gross margin of 6.9% for the quarter compared to 6.5% in Q1 2025. Cash Offer remains the core differentiator. Cash Offer Marketplace grew over 60% year - over - year in 2025 and is expected to be a meaningful contributor to gross profit in the second half of 2026. Offerpad's Brokerage Services referred more qualified sellers to HomePro agents in Q1 than in all of 2025, and one - third of cash offer requests now come through the agent partnership program. Offerpad Renovate generated $5.7 million in revenue in Q1 2026 compared to $5.3 million in Q1 2025, with margins of 20% to 30% and no balance sheet capital required.

• Q1 2026 had 263 transactions and $80 million in revenue. Q2 guidance is 300 to 350 real estate transactions across cash offer, cash offer marketplace, and brokerage services, with total revenue of 80 to 90 million and a narrower adjusted EBITDA loss compared to Q1.
• Expect sequential improvement in Q3 and Q4 as conversion improves. Approximately 1,000 transactions per quarter is the path to adjusted EBITDA breakeven, and every transaction above that threshold is expected to contribute incremental margin.
• The 2026 operating framework doesn't anticipate requiring incremental equity capital to execute, with sufficient liquidity, facilities, and cost structure to scale within guardrails.

Q: Taking the midpoint of 2Q's guidance that 85 million revenue over 325 transactions, that gets us to a revenue per transaction that's about 14% lower than 1Q. Is that just going to be the mix shift? And if so, could you help break down how you're thinking about the mix between the products?

A: That's right. Historically, there's a roughly two - thirds, one - third mix between products, two - thirds cash offer and one - third other products including HomePro and Cash Offer Marketplace. Cash Offer targets around 5% of the home value for gross profit, cash offer marketplace is similar, and home pro is lower, around one or one and a half percent. As conversion broadens across other products, the per transaction figure adjusts accordingly.

Q: On just the top of funnel of home sellers, how is that trend at the start of the year? Recall that you previously called out that it's roughly 10K to 20K in any given month. So has that accelerated at all?

A: That's actually stayed very strong and continuing to even see some growth there as well. The marketing team has been focused on not just bringing in more leads or more sellers, but the quality of sellers, so we're seeing really strong, engaged sellers that are coming top of funnel.

Q: I'll go back to that 1,000 per quarter target you guys had out there. I mean, those kind of suggest, like Peter said, a meaningful ramp in the second half. to get to that target and you also have to kind of factor in the seasonality aspect of that. So just curious to hear like where like the conversion of your platform stands today and like where do you see the opportunity to improve that? Is it on the cash offer side? Is it on the other transactions? Is it like varied by geography?

A: We have historically been a really one product or a little bit, one to two products, now we're three products. Particularly with the addition of the brokered services solution, we're seeing conversion going up based on having additional offers for the top of funnel customer and just increasing the likelihood that they that they choose a solution. 1000 transactions is something we came down intentionally over the last couple quarters last year on our cash offer volume as we worked on our operations and we're able to ramp that up just based on the adjustments that we're making and the price point that we're putting out there and our buy box characteristics. With our current volume, it's going to take a conversion increase of 1% to 2% a month to make that happen. And one of the things that's important is we're able to now serve customers we weren't able to serve before with our listing services. For example, if there were homes that were outside or out of area, out of our buy box, we simply just couldn't offer on that with a cash offer or through our cash offer marketplace. Now with brokered services, it changes conversion because we can find a solution to them. And with our listing services, the customer gets free moving services, home warranties. So it's a really strong, compelling product on why to list with one of our home pros. And so that, you know, so if we can, as we increase conversion, which we're starting to see that now with our different products, and then able to serve customers before That's what gives us the confidence towards that 1,000 transactions per quarter.

Q: I wanted to ask你 on the 1,000 transactions and the adjusted EBITDA. So does your adjusted EBITDA break - even expectations include renovations in those transactions or renovations that separate them from the transactions?

A: Absolutely. It's in there in the cost of goods sold as part of the cash offer product, and then separately for the B2B third - party renovate business, it's also in the cost of goods sold.

Q: What was the mix between cash offer and other services in the current transactions you reported in 1Q? And I know in the past you've talked about maybe 50 - 50 mix as you approach adjusted EBITDA breakeven. Is that still the expectation?

A: In the mix, you can see on the trending schedules on the IR site, we break out all those details. But the mix has been, as I mentioned, the mix has been about one - third, two - thirds cash offer. And yes, we do expect as we move across the year up towards 1,000 transactions, a larger percentage coming from the other two real estate transaction products.

Q: On the operating expense side, as you ran from the transactions, do you expect the operating expenses to remain where they are? Or did you expect any further improvements or any increases on the operating expenses side?

A: If you look on the P&L, right, so for this quarter, there's $14.5 million of operating expenses. If you look on the non - GAAP reconciliation table, you can see that there are some selling and holding cost expenses in there. It's around $2 million for this quarter. That small piece of operating expenses in the GAAP reporting, is variable, but the large majority of it, which is about $12 million, which we highlighted in the prepared remarks, or $12.5 million, is not variable. And in fact, there are a few more levers that we're working to pull that are harder than the other cost - outs that we've done across the last few years. uh and so we expect that to actually continue to come down not as dramatically as we haven't have over over time it was as a couple years ago it was as much as 80 million per quarter and now we're down um uh to 12 and a half or with the holding costs 14 and a half million um uh so it won't come down too much more but it it we expect to go down not up