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TABLE OF CONTENTS
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2023
OR
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ____________.
Commission file number 001-39253
Opendoor Technologies Inc.
(Exact name of registrant as specified in its charter)
Delaware30-1318214
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer Identification No.)
410 N. Scottsdale Road,Suite 1600
Tempe,AZ
85288
(Address of Principal Executive Offices)(Zip Code)
(480) 618-6760
Registrant's telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $0.0001 par value per shareOPENThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer☒Accelerated filer☐
Non-accelerated filer☐Smaller reporting company☐
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The number of shares of registrant’s common stock outstanding as of October 26, 2023 was approximately 670,031,190.

TABLE OF CONTENTS
OPENDOOR TECHNOLOGIES INC.
TABLE OF CONTENTS
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OPENDOOR TECHNOLOGIES INC.
As used in this Quarterly Report on Form 10-Q, unless the context requires otherwise, references to “Opendoor,” the “Company,” “we,” “us,” and “our,” and similar references refer to Opendoor Technologies Inc. and its wholly owned subsidiaries following the Business Combination (as defined herein) and to Opendoor Labs Inc. prior to the Business Combination.

FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including, without limitation, statements regarding: current and future health and stability of the real estate housing market and general economy; volatility of mortgage interest rates and expectations regarding the future shifts in behavior by consumers and partners; the health and status of our financial condition; anticipated future results of operations or financial performance; priorities of the Company to achieve future financial and business goals; our ability to continue to effectively navigate the markets in which it operates; anticipated future and ongoing impacts and benefits of acquisitions, partnership channel expansions, product innovations and other business decisions; health of our balance sheet to weather ongoing market transitions and any expectation to quickly re-scale in the future upon market stabilization; the Company’s ability to adopt an effective approach to manage economic and industry risk, as well as inventory health; our expectations with respect to the future success of our partnerships and our ability to drive significant growth in sales volumes through such partnerships; business strategy and plans, including plans to expand into additional markets; market opportunity and expansion and objectives of management for future operations, including statements regarding the benefits and timing of the roll out of new markets, products, or technology; and the expected diversification of funding sources, are forward-looking statements. When used in this Quarterly Report on Form 10-Q, words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “might,” “opportunity,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strategy,” “strive,” “target,” “vision,” “will,” or “would,” any negative of these words or other similar terms or expressions may identify forward-looking statements. The absence of these words does not mean that a statement is not forward-looking.
These forward-looking statements are based on information available as of the date of this Quarterly Report on Form 10-Q and current expectations, forecasts and assumptions, which involve a number of judgments, risks and uncertainties, including without limitation, risks related to:
•the current and future health and stability of the economy, financial conditions and residential housing market, including any extended downturns or slowdowns;
•changes in general economic and financial conditions (including federal monetary policy, interest rates, inflation, actual or anticipated recession, home price fluctuations, and housing inventory) that may reduce demand for our products and services, lower our profitability or reduce our access to future financings;
•our real estate assets and increased competition in the U.S. residential real estate industry;
•ability to operate and grow our core business products, including the ability to obtain sufficient financing and resell purchased homes;
•investment of resources to pursue strategies and develop new products and services that may not prove effective or that are not attractive to customers and real estate partners or that do not allow us to compete successfully;
•our ability to acquire and resell homes profitably;
•our ability to grow market share in our existing markets or any new markets we may enter;
•our ability to manage our growth effectively;
•our ability to access sources of capital, including debt financing and securitization funding to finance our real estate inventories and other sources of capital to finance operations and growth;
•our ability to maintain and enhance our products and brand, and to attract customers;
•our ability to manage, develop and refine our technology platform, including our automated pricing and valuation technology;
•ability to comply with multiple listing service rules and requirements to access and use listing data, and to maintain or establish relationships with listings and data providers;
•ability to obtain or maintain licenses and permits to support our current and future business operations;
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•any future impact of the ongoing COVID-19 pandemic (including future variants) or other public health crises on our ability to operate, demand for our products or services, or general economic conditions;
•acquisitions, strategic partnerships, joint ventures, capital-raising activities or other corporate transactions or commitments by us or our competitors;
•actual or anticipated changes in technology, products, markets or services by us or our competitors;
•our success in retaining or recruiting, or changes required in, our officers, key employees and/or directors;
•the impact of the regulatory environment within our industry and complexities with compliance related to such environment;
•changes in laws or government regulation affecting our business; and
•the impact of pending or any future litigation or regulatory actions.
Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the effect of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
As a result of a number of known and unknown risks and uncertainties, including, without limitation, those described in the “Risk Factors” section of this Quarterly Report on Form 10-Q and on Part I. Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 (the “Annual Report”), our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. You should not place undue reliance on these forward-looking statements.
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PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
OPENDOOR TECHNOLOGIES INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except share data)
(Unaudited)
September 30,
2023		December 31,
2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents$1,154 $1,137 
Restricted cash1,224 654 
Marketable securities72 144 
Escrow receivable11 30 
Real estate inventory, net1,311 4,460 
Other current assets $0 and $1 carried at fair value)
47 41 
Total current assets3,819 6,466 
PROPERTY AND EQUIPMENT – Net68 58 
RIGHT OF USE ASSETS27 41 
GOODWILL4 4 
INTANGIBLES – Net7 12 
OTHER ASSETS22 27 
TOTAL ASSETS
(1)
$3,947 $6,608 
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable and other accrued liabilities$67 $110 
Non-recourse asset-backed debt - current portion— 1,376 
Interest payable1 12 
Lease liabilities - current portion6 7 
Total current liabilities74 1,505 
NON-RECOURSE ASSET-BACKED DEBT – Net of current portion2,330 3,020 
CONVERTIBLE SENIOR NOTES502 959 
LEASE LIABILITIES – Net of current portion20 38 
OTHER LIABILITIES1 — 
Total liabilities
(2)
2,927 5,522 
COMMITMENTS AND CONTINGENCIES (See Note 14)
SHAREHOLDERS’ EQUITY:
Common stock, $0.0001 par value; 3,000,000,000 shares authorized; 668,592,580 and 637,387,025 shares issued, respectively; 668,592,580 and 637,387,025 shares outstanding, respectively
— — 
Additional paid-in capital4,263 4,148 
Accumulated deficit(3,242)(3,058)
Accumulated other comprehensive loss(1)(4)
Total shareholders’ equity 1,020 1,086 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$3,947 $6,608 
________________
(1)The Company’s consolidated assets at September 30, 2023 and December 31, 2022 include the following assets of certain variable interest entities (“VIEs”) that can only be used to settle the liabilities of those VIEs: Restricted cash, $1,203 and $636; Real estate inventory, net, $1,272 and $4,408; Escrow receivable, $11 and $29; Other current assets, $13 and $9; and Total assets of $2,499 and $5,082, respectively.
(2)The Company’s consolidated liabilities at September 30, 2023 and December 31, 2022 include the following liabilities for which the VIE creditors do not have recourse to Opendoor: Accounts payable and other accrued liabilities, $25 and $61; Interest payable, $1 and $11; Current portion of non-recourse asset-backed debt, $— and $1,376; Non-recourse asset-backed debt, net of current portion, $2,330 and $3,020; and Total liabilities, $2,356 and $4,468, respectively.
See accompanying notes to condensed consolidated financial statements.
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OPENDOOR TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except share amounts which are presented in thousands, and per share amounts)
(Unaudited)
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
REVENUE$980 $3,361 $6,076 $12,710 
COST OF REVENUE884 3,786 5,661 12,114 
GROSS PROFIT (LOSS)
96 (425)415 596 
OPERATING EXPENSES:
Sales, marketing and operations85 260 397 812 
General and administrative48 85 158 323 
Technology and development42 40 121 121 
Restructuring— — 10 — 
Total operating expenses175 385 686 1,256 
LOSS FROM OPERATIONS
(79)(810)(271)(660)
GAIN ON EXTINGUISHMENT OF DEBT— — 182 — 
INTEREST EXPENSE(47)(115)(174)(272)
OTHER INCOME (LOSS) – Net20 (2)80 (20)
LOSS BEFORE INCOME TAXES
(106)(927)(183)(952)
INCOME TAX EXPENSE— (1)(1)(2)
NET LOSS
$(106)$(928)$(184)$(954)
Net loss per share attributable to common shareholders:
Basic$(0.16)$(1.47)$(0.28)$(1.53)
Diluted$(0.16)$(1.47)$(0.28)$(1.53)
Weighted-average shares outstanding:
Basic662,149 629,535 651,939 624,581 
Diluted662,149 629,535 651,939 624,581 

















See accompanying notes to condensed consolidated financial statements.
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OPENDOOR TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In millions)
(Unaudited)
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
NET LOSS
$(106)$(928)$(184)$(954)
OTHER COMPREHENSIVE INCOME (LOSS):
Unrealized gain (loss) on marketable securities1 — 3 (3)
COMPREHENSIVE LOSS
$(105)$(928)$(181)$(957)
See accompanying notes to condensed consolidated financial statements.
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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In millions, except number of shares)
(Unaudited)

Shareholders’ Equity
Common StockAdditional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
SharesAmount
BALANCE-June 30, 2023657,337,566 $— $4,224 $(3,136)$(2)$1,086 
Vesting of restricted stock units9,613,088 — — — — — 
Exercise of stock options134,563 — — — — — 
Employee stock purchase plan1,507,363 — 1 — — 1 
Stock-based compensation— — 38 — — 38 
Other comprehensive income— — — — 1 1 
Net loss— — — (106)— (106)
BALANCE–September 30, 2023668,592,580 $— $4,263 $(3,242)$(1)$1,020 
Shareholders’ Equity
Common StockAdditional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
SharesAmount
BALANCE-December 31, 2022637,387,025 $— $4,148 $(3,058)$(4)$1,086 
Vesting of restricted stock units26,749,344 — — — — — 
Exercise of stock options2,304,417 — 2 — — 2 
Employee stock purchase plan2,151,794 — 2 — — 2 
Stock-based compensation— — 111 — — 111 
Other comprehensive income— — — — 3 3 
Net loss— — — (184)— (184)
BALANCE–September 30, 2023668,592,580 $— $4,263 $(3,242)$(1)$1,020 

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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In millions, except number of shares)
(Unaudited)
Shareholders’ Equity
Common StockAdditional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
SharesAmount
BALANCE-June 30, 2022627,033,133 $— $4,092 $(1,731)$(5)$2,356 
Vesting of restricted shares316 — — — — — 
Vesting of restricted stock units4,414,922 — — — — — 
Exercise of stock options570,974 — 1 — — 1 
Employee stock purchase plan493,790 — 2 — — 2 
Stock-based compensation— — 57 — — 57 
Other comprehensive loss— — — — — — 
Net loss— — — (928)— (928)
BALANCE–September 30, 2022632,513,135 $— $4,152 $(2,659)$(5)$1,488 
Shareholders’ Equity
Common StockAdditional
Paid-in
Capital		Accumulated
Deficit		Accumulated
Other
Comprehensive
Loss
Total
Shareholders’
Equity
SharesAmount
BALANCE-December 31, 2021616,026,565 $— $3,955 $(1,705)$(2)$2,248 
Vesting of restricted shares142,445 — — — — — 
Vesting of restricted stock units12,957,946 — — — — — 
Exercise of stock options2,892,389 — 4 — — 4 
Employee stock purchase plan493,790 — 2 — — 2 
Stock-based compensation— — 191 — — 191 
Other comprehensive loss— — — — (3)(3)
Net loss— — — (954)— (954)
BALANCE–September 30, 2022632,513,135 $— $4,152 $(2,659)$(5)$1,488 











See accompanying notes to condensed consolidated financial statements.
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OPENDOOR TECHNOLOGIES INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
Nine Months Ended
September 30,
20232022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss$(184)$(954)
Adjustments to reconcile net loss to cash, cash equivalents, and restricted cash provided by (used in) operating activities:
Depreciation and amortization 50 59 
Amortization of right of use asset5 6 
Stock-based compensation94 178 
Inventory valuation adjustment54 663 
Changes in fair value of equity securities4 36 
Other6 (1)
Origination of mortgage loans held for sale— (118)
Proceeds from sale and principal collections of mortgage loans held for sale1 128 
Gain on extinguishment of debt(182)— 
Changes in operating assets and liabilities:
Escrow receivable19 (70)
Real estate inventory3,082 (663)
Other assets(15)— 
Accounts payable and other accrued liabilities(29)73 
Interest payable(10)4 
Lease liabilities(9)(6)
Net cash provided by (used in) operating activities2,886 (665)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment(28)(33)
Purchase of marketable securities— (28)
Proceeds from sales, maturities, redemptions and paydowns of marketable securities75 293 
Purchase of non-marketable equity securities— (25)
Proceeds from sale of non-marketable equity securities1 3 
Capital returns from non-marketable equity securities— 3 
Acquisitions, net of cash acquired— (3)
Net cash provided by investing activities48 210 
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of convertible senior notes(270)— 
Proceeds from exercise of stock options2 4 
Proceeds from issuance of common stock for ESPP2 2 
Proceeds from non-recourse asset-backed debt238 9,160 
Principal payments on non-recourse asset-backed debt(2,315)(8,179)
Proceeds from other secured borrowings— 114 
Principal payments on other secured borrowings— (121)
Payment of loan origination fees and debt issuance costs— (24)
Payment for early extinguishment of debt(4)— 
Net cash (used in) provided by financing activities(2,347)956 
NET INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH587 501 
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH – Beginning of period1,791 2,578 
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH – End of period$2,378 $3,079 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION – Cash paid during the period for interest$169 $248 
DISCLOSURES OF NONCASH ACTIVITIES:
Stock-based compensation expense capitalized for internally developed software$17 $13 
RECONCILIATION TO CONDENSED CONSOLIDATED BALANCE SHEETS:
Cash and cash equivalents$1,154 $1,327 
Restricted cash1,224 1,752 
Cash, cash equivalents, and restricted cash$2,378 $3,079 
See accompanying notes to condensed consolidated financial statements.
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)

1.DESCRIPTION OF BUSINESS AND ACCOUNTING POLICIES
Description of Business
Opendoor Technologies Inc. (the “Company” and “Opendoor”) including its consolidated subsidiaries and certain variable interest entities (“VIEs”), is a managed marketplace for residential real estate. By leveraging our centralized platform, Opendoor is working towards a future that enables sellers and buyers of residential real estate to experience a simple and certain transaction that is dramatically improved from the traditional process. The Company was incorporated in Delaware on December 30, 2013.
Basis of Presentation and Principles of Consolidation
The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to generally accepted accounting principles in the United States of America (“GAAP”). The condensed consolidated financial statements as of September 30, 2023 and December 31, 2022 and for the three and nine month periods ended September 30, 2023 and 2022 include the accounts of Opendoor, its wholly owned subsidiaries and VIEs where the Company is the primary beneficiary. The accompanying unaudited condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. All significant intercompany accounts and transactions have been eliminated in the condensed consolidated financial statements herein. Certain prior period amounts in the condensed consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation.
The Company was formed through a business combination with Social Capital Hedosophia Holdings Corp. II (“SCH”), a Cayman Islands exempted company formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”). The Business Combination, pursuant to which Opendoor Labs Inc. became a wholly owned subsidiary of SCH and SCH changed its name from “Social Capital Hedosophia Holdings Corp. II” to “Opendoor Technologies Inc.”, was completed on December 18, 2020, and was accounted for as a reverse recapitalization, in accordance with GAAP.
The accompanying interim condensed consolidated financial statements and these related notes should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (“Annual Report”) filed on February 23, 2023.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that have a material impact on the amounts reported in the financial statements and accompanying notes. Significant estimates, assumptions and judgments made by management include, among others, the determination of the fair value of common stock, share-based awards, and inventory valuation adjustment. Management believes that the estimates and judgments upon which management relies are reasonable based upon information available to management at the time that these estimates and judgments are made. To the extent there are material differences between these estimates, assumptions and judgments and actual results, the carrying values of the Company's assets and liabilities and the results of operations will be affected. The health of the residential housing market and interest rate environment have introduced additional uncertainty with respect to judgments, estimates and assumptions, which may materially impact the estimates previously listed, among others.
Significant Risks and Uncertainties
The Company operates in a dynamic industry and, accordingly, can be affected by a variety of factors. For example, the Company believes that changes in any of the following areas could have a significant negative effect on the Company in terms of its future financial position, results of operations or cash flows: public health crises, like the COVID-19 pandemic; its rate of revenue growth; its ability to manage inventory; engagement and usage of its products; the effectiveness of its investment of resources to pursue strategies; competition in its market; the stability of the residential real estate market; the impact of interest rate changes on demand for and pricing of its products and on the cost of capital; changes in technology, products, markets or services by the Company or its competitors; its ability to maintain or establish relationships with listings and data providers; its
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
ability to obtain or maintain licenses and permits to support its current and future businesses; actual or anticipated changes to its products and services; changes in government regulation affecting its business; the outcomes of legal proceedings; natural disasters and catastrophic events; scaling and adaptation of existing technology and network infrastructure; its management of its growth; its ability to attract and retain qualified employees and key personnel; its ability to successfully integrate and realize the benefits of its past or future strategic acquisitions or investments; the protection of customers’ information and other privacy concerns; the protection of its brand and intellectual property; and intellectual property infringement and other claims, among other things.
Concentrations of Credit Risk
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents, restricted cash, and investments in marketable securities. The Company places cash and cash equivalents and investments with major financial institutions, which management assesses to be of high credit quality, in order to limit exposure of the Company’s investments.
Significant Accounting Policies
The Company’s significant accounting policies are discussed in “Part II – Item 8 – Financial Statements and Supplementary Data – Note 1. Description of Business and Accounting Policies” in the Annual Report. There have been no changes to these significant accounting policies for the nine-month period ended September 30, 2023, except as noted below.
Convertible Senior Notes
The 0.25% convertible senior notes due in 2026 (the “2026 Notes”) issued by the Company in August 2021 are accounted for wholly as debt. The 2026 Notes have an initial carrying value equal to the net proceeds from issuance. Issuance costs associated with the 2026 Notes are amortized over the term using the effective interest method. Conversions are settled through payment of cash or a combination of cash and stock, at the Company’s option. Upon conversion, the carrying amount of the 2026 Notes, including any unamortized debt issuance costs, is reduced by cash paid, with any difference being reflected as a change in equity. There will not be any gains or losses recognized upon a conversion. Upon extinguishment of any portion of the 2026 Notes, the difference between the repurchase price of the extinguished notes and the respective net carrying amount is recorded as a gain or loss in Gain on extinguishment of debt in the condensed consolidated statements of operations. See “Note 5 — Credit Facilities and Long-Term Debt” for details on the partial repurchase of the Company's convertible notes that occurred in the period.
Impairment of Long-Lived Assets
Long-lived assets, such as property and equipment and definite-lived intangible assets, among other long-lived assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment loss is recognized to the extent the carrying amount of the underlying asset exceeds its fair value. The impairment loss recognized for the three and nine months ended September 30, 2023 is primarily related to impairment of certain internally developed software projects. The impairment loss recognized during the periods presented is as follows (in millions):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
General and administrative$1 $— $1 $— 
Technology and development$1 $1 4 1 
Total impairment loss$2 $1 $5 $1 
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
Recently Issued Accounting Standards
Recently Adopted Accounting Standards
In July 2023, the FASB issued ASU 2023-03 which amends various paragraphs in the Accounting Standards Codification pursuant to the issuance of Commission Staff Bulletin No. 120. These updates were effective immediately and did not have a material impact on the Company’s condensed consolidated financial statements.
2.REAL ESTATE INVENTORY
The following table presents the components of inventory, net of applicable inventory valuation adjustments of $33 million and $459 million, as of September 30, 2023 and December 31, 2022, respectively (in millions):
September 30,
2023		December 31,
2022
Work in progress$298 $891 
Finished goods:
Listed for sale705 2,788 
Under contract for sale308 781 
Total real estate inventory$1,311 $4,460 
As of September 30, 2023, the Company was in contract to purchase 1,661 homes for an aggregate purchase price of $578 million.
During the three and nine months ended September 30, 2023, the Company recorded inventory valuation adjustments for real estate inventory of $17 million and $54 million, respectively, in Cost of revenue in the condensed consolidated statements of operations. During the three and nine months ended September 30, 2022, the Company recorded inventory valuation adjustments for real estate inventory of $573 million and $663 million, respectively, in Cost of revenue in the condensed consolidated statements of operations.
3.CASH, CASH EQUIVALENTS, AND INVESTMENTS
The amortized cost, gross unrealized gains and losses, and fair value of cash, cash equivalents, and marketable securities as of September 30, 2023 and December 31, 2022, are as follows (in millions):
September 30, 2023
Cost
Basis
Unrealized
Gains
Unrealized
Losses
Fair Value
Cash and Cash
Equivalents
Marketable
Securities
Cash$69 $— $— $69 $69 $— 
Money market funds1,085 — — 1,085 1,085 — 
Corporate debt securities61 — (1)60 — 60 
Equity securities12 — — 12 — 12 
Total$1,227 $— $(1)$1,226 $1,154 $72 
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
December 31, 2022
Cost
Basis
Unrealized
Gains
Unrealized
Losses
Fair Value
Cash and Cash
Equivalents
Marketable
Securities
Cash$422 $— $— $422 $422 $— 
Money market funds715 — — 715 715 — 
Corporate debt securities126 — (4)122 — 122 
Equity securities11 — — 11 — 11 
Certificates of deposit9 — — 9 — 9 
Asset-backed securities2 — — 2 — 2 
Total$1,285 $— $(4)$1,281 $1,137 $144 
During the three and nine months ended September 30, 2023, the Company recognized $(6) million and $1 million of net unrealized (losses) gains, respectively, in the condensed consolidated statements of operations related to marketable equity securities held as of September 30, 2023. During the three and nine months ended September 30, 2022, the Company recognized $11 million and $36 million of net unrealized losses, respectively, in the condensed consolidated statements of operations related to marketable equity securities held as of September 30, 2022.
A summary of debt securities with unrealized losses aggregated by period of continuous unrealized loss is as follows (in millions):
Less than 12 Months12 Months or GreaterTotal
September 30, 2023Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Corporate debt securities$— $— $60 $(1)$60 $(1)
Total$— $— $60 $(1)$60 $(1)
Less than 12 Months12 Months or GreaterTotal
December 31, 2022Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Fair Value
Unrealized
Losses
Corporate debt securities$5 $— $117 $(4)$122 $(4)
Certificates of deposit6 — — — 6 — 
Asset-backed securities— — 2 — 2 — 
Total$11 $— $119 $(4)$130 $(4)
Net unrealized losses of the Company's available-for-sale debt securities as of September 30, 2023 and December 31, 2022 were $1 million and $4 million, respectively. These unrealized losses are associated with the Company’s investments in corporate debt securities and were due to interest rate increases, and not credit-related events. The Company does not expect to be required to sell the investments before recovery of the amortized cost bases. As such, no allowance for credit losses is required as of September 30, 2023 or December 31, 2022.
The scheduled contractual maturities of debt securities as of September 30, 2023 are as follows (in millions):
September 30, 2023Fair Value
Within
1 Year
After
1 Year
through
5 Years
Corporate debt securities$60 $60 $— 
Total$60 $60 $— 
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
A summary of non-marketable equity securities and equity method investment balances as of September 30, 2023 and December 31, 2022 are as follows (in millions):
September 30,
2023		December 31,
2022
Equity method investments$20 $20 
Non-marketable equity securities— 5 
Total$20 $25 
During both the three and nine months ended September 30, 2023, the Company recognized $5 million of net unrealized losses in the condensed consolidated statements of operations related to non-marketable equity securities held as of September 30, 2023. No unrealized losses were recognized during the three and nine months ended September 30, 2022 in the condensed consolidated statements of operations related to non-marketable equity securities held as of September 30, 2022.
4.VARIABLE INTEREST ENTITIES
The Company utilizes VIEs in the normal course of business to support the Company’s financing needs. The Company determines whether the Company is the primary beneficiary of a VIE at the time it becomes involved with the VIE and reconsiders that conclusion on an on-going basis.
The Company established certain special purpose entities (“SPEs”) for the purpose of financing the Company’s purchase and renovation of real estate inventory through the issuance of asset-backed debt. The Company is the primary beneficiary of the various VIEs within these financing structures and consolidates these VIEs. The Company is determined to be the primary beneficiary based on its power to direct the activities that most significantly impact the economic outcomes of the SPEs through its role in designing the SPEs and managing the real estate inventory they purchase and sell. The Company has a potentially significant variable interest in the entities based upon the equity interest the Company holds in the VIEs.
The following table summarizes the assets and liabilities related to the VIEs consolidated by the Company as of September 30, 2023 and December 31, 2022 (in millions):
September 30,
2023		December 31,
2022
Assets
Restricted cash
$1,203 $636 
Real estate inventory, net1,272 4,408 
Other(1)
24 38 
Total assets$2,499 $5,082 
Liabilities
Non-recourse asset-backed debt$2,330 $4,396 
Other(2)
26 72 
Total liabilities$2,356 $4,468 
________________
(1)Includes escrow receivable and other current assets.
(2)Includes accounts payable and other accrued liabilities and interest payable.
The creditors of the VIEs generally do not have recourse to the Company’s general credit solely by virtue of being creditors of the VIEs. However, certain of the financial covenants included in the inventory financing facilities to which the VIEs are party are calculated by reference to Opendoor Labs Inc. and its consolidated subsidiaries' assets and liabilities. As a result, under certain circumstances, this may limit the Company's flexibility to transfer assets from Opendoor subsidiaries to the Parent Company. See “Note 5 — Credit Facilities and Long-Term Debt” for further discussion of the recourse obligations with respect to the VIEs.
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
5.CREDIT FACILITIES AND LONG-TERM DEBT
The following tables summarize certain details related to the Company's credit facilities and long-term debt as of September 30, 2023 and December 31, 2022 (in millions, except interest rates):
Outstanding Amount
September 30, 2023
Borrowing
Capacity
CurrentNon-Current
Weighted
Average
Interest Rate
End of Revolving / Withdrawal Period
Final Maturity
Date
Non-Recourse Asset-backed Debt:
Asset-backed Senior Revolving Credit Facilities
Revolving Facility 2018-2$1,000 $— $— 7.49 %June 30, 2025June 30, 2025
Revolving Facility 2018-31,000 — — 6.82 %September 29, 2026September 29, 2026
Revolving Facility 2019-1300 — — 7.34 %August 15, 2025August 15, 2025
Revolving Facility 2019-2650 — — 6.83 %October 6, 2023October 6, 2023
Revolving Facility 2019-3925 — — — %April 5, 2024April 4, 2025
Asset-backed Senior Term Debt Facilities
Term Debt Facility 2021-S1100 — 100 3.48 %January 2, 2025April 1, 2025
Term Debt Facility 2021-S2400 — 300 3.20 %September 10, 2025March 10, 2026
Term Debt Facility 2021-S31,000 — 750 3.75 %January 31, 2027July 31, 2027
Term Debt Facility 2022-S1250 — 250 4.07 %March 1, 2025September 1, 2025
Total$5,625 $— $1,400 
Issuance Costs— (13)
Carrying Value$— $1,387 
Asset-backed Mezzanine Term Debt Facilities
Term Debt Facility 2020-M12,300 — 800 10.00 %April 1, 2025April 1, 2026
Term Debt Facility 2022-M1500 — 150 10.00 %September 15, 2025September 15, 2026
Total$2,800 $— $950 
Issuance Costs(7)
Carrying Value$943 
Total Non-Recourse Asset-backed Debt$8,425 $— $2,330 
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
Outstanding Amount
December 31, 2022CurrentNon-Current
Weighted
Average
Interest Rate
Non-Recourse Asset-backed Debt:
Asset-backed Senior Revolving Credit Facilities
Revolving Facility 2018-2$472 $— 4.86 %
Revolving Facility 2018-3194 — 3.98 %
Revolving Facility 2019-155 — 4.41 %
Revolving Facility 2019-2167 — 3.92 %
Revolving Facility 2019-3— — 3.86 %
Revolving Facility 2022-1289 — 8.15 %
Asset-backed Senior Term Debt Facilities
Term Debt Facility 2021-S1— 400 3.48 %
Term Debt Facility 2021-S2— 500 3.20 %
Term Debt Facility 2021-S3— 750 3.75 %
Term Debt Facility 2022-S1— 250 4.07 %
Term Debt Facility 2022-S2200 — 8.48 %
Total$1,377 $1,900 
Issuance Costs(1)(17)
Carrying Value$1,376 $1,883 
Asset-backed Mezzanine Term Debt Facilities
Term Debt Facility 2020-M1$— $1,000 10.00 %
Term Debt Facility 2022-M1$— $150 10.00 %
Total$— $1,150 
Issuance Costs(13)
Carrying Value$1,137 
Total Non-Recourse Asset-backed Debt$1,376 $3,020 
Non-Recourse Asset-backed Debt
The Company utilizes inventory financing facilities consisting of asset-backed senior debt facilities and asset-backed mezzanine term debt facilities to provide financing for the Company’s real estate inventory purchases and renovation. These inventory financing facilities are typically secured by some combination of restricted cash, equity in real estate owning subsidiaries and related holding companies, and, for senior facilities, the real estate inventory financed by the relevant facility and/or beneficial interests in such inventory.
Each of the borrowers under the inventory financing facilities is a consolidated subsidiary of Opendoor and a separate legal entity. Neither the assets nor credit of any such borrower subsidiaries are generally available to satisfy the debts and other obligations of any other Opendoor entities. The inventory financing facilities are non-recourse to the Company and are non-recourse to Opendoor subsidiaries not party to the relevant facilities, except for limited guarantees provided by an Opendoor subsidiary for certain obligations in situations involving “bad acts” by an Opendoor entity and certain other limited circumstances.
As of September 30, 2023, the Company had total borrowing capacity with respect to its non-recourse asset-backed debt of $8.4 billion. Borrowing capacity amounts under non-recourse asset-backed debt as reflected in the table above are in some cases not fully committed and any borrowings above the committed amounts are subject to the applicable lender’s discretion. Any amounts repaid for senior term and mezzanine term debt facilities reduce total borrowing capacity as repaid amounts are not available to be reborrowed. As of September 30, 2023, the Company had committed borrowing capacity with respect to the Company’s non-recourse asset-backed debt of $3.0 billion; this committed borrowing capacity is comprised of $650 million for senior revolving credit facilities, $1.4 billion for senior term debt facilities, and $950 million for mezzanine term debt facilities.
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
Asset-backed Senior Revolving Credit Facilities
The Company classifies the senior revolving credit facilities as current liabilities on the Company’s condensed consolidated balance sheets as amounts drawn to acquire and renovate homes are required to be repaid as the related real estate inventory is sold, which the Company expects to occur within 12 months.
The senior revolving credit facilities are typically structured with an initial revolving period of up to 24 months during which time amounts can be borrowed, repaid and borrowed again. The borrowing capacity is generally available until the end of the applicable revolving period as reflected in the table above. Outstanding amounts drawn under each senior revolving credit facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The final maturity dates and revolving period end dates reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company. These facilities may also have extensions subject to lender discretion that are not reflected in the table above. On October 3, 2023, the Company entered into an amendment to Revolving Facility 2019-2, providing for $550 million of borrowing capacity with a revolving period end date of October 3, 2025 and a final maturity date of October 2, 2026, which is inclusive of any extensions that are at the sole discretion of the Company.
Borrowings under the senior revolving credit facilities accrue interest at various floating rates based on a London Interbank Offered Rate ("LIBOR") or a secured overnight financing rate ("SOFR"), plus a margin that varies by facility. Effective November 2022, all such floating rates are based on SOFR. The Company may also pay fees on certain unused portions of committed borrowing capacity. The Company’s senior revolving credit facility arrangements typically include upfront fees that may be paid at execution of the applicable agreements or be earned at execution and payable over time. These facilities are generally fully prepayable at any time without penalty other than customary breakage costs.
The senior revolving credit facilities have aggregated borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility and the time that those properties are in the Company’s possession. When the Company resells a home, the proceeds are used to reduce the outstanding balance under the related senior revolving credit facility. The borrowing base for a given facility may be reduced as properties age beyond certain thresholds or the performance of the properties financed under that facility declines, and any borrowing base deficiencies may be satisfied through contributions of additional properties or partial repayment of the facility.
Asset-backed Senior Term Debt Facilities
The Company classifies its senior term debt facilities as non-current liabilities on the Company’s condensed consolidated balance sheets because its borrowings under these facilities are generally not required to be repaid until the final maturity date.
The senior term debt facilities are typically structured with an initial withdrawal period up to 60 months during which the outstanding principal amounts are generally not required to be repaid when homes financed through those facilities are sold and instead are intended to remain outstanding until final maturity for each facility. Outstanding amounts drawn under each senior term debt facility are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The final maturity dates and withdrawal period end dates reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company. These facilities may also have extensions subject to lender discretion that are not reflected in the table above.
Borrowings under the senior term debt facilities accrue interest at a fixed rate with the exception of Term Debt Facility 2022-S2, which accrued interest at a floating rate based on SOFR plus a margin. The Company's senior term debt facilities may include upfront issuance costs that are capitalized as part of the facilities' respective carrying values. These facilities are fully prepayable at any time but may be subject to certain customary prepayment penalties.
The senior term debt facilities have aggregated property borrowing bases, which increase or decrease based on the cost and value of the properties financed under a given facility, the time those properties are in the Company’s possession and the amount of cash collateral pledged by the relevant borrowers. The borrowing base for a given facility may be reduced as properties age or collateral performance declines beyond certain thresholds, and any borrowing base deficiencies may be satisfied through contributions of additional properties, cash or through partial repayment of the facility.
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
Asset-backed Mezzanine Term Debt Facilities
The Company classifies its mezzanine term debt facilities as long-term liabilities on the Company’s condensed consolidated balance sheets because its borrowings under these facilities are generally not required to be repaid until the applicable final maturity date. These facilities are structurally and contractually subordinated to the related asset-backed senior debt facilities.
The mezzanine term debt facilities have been structured with an initial 42-month withdrawal period during which the outstanding principal amounts are generally not required to be repaid when homes financed through those facilities are sold and instead are intended to remain outstanding until final maturity. Outstanding amounts drawn under the mezzanine term debt facilities are required to be repaid on the facility maturity date or earlier if accelerated due to an event of default or other mandatory repayment event. The final maturity date and withdrawal period end date reflected in the table above are inclusive of any extensions that are at the sole discretion of the Company. These facilities may also have extensions subject to lender discretion that are not reflected in the table above.
Borrowings under a given term debt facility accrue interest at a fixed rate. The mezzanine term debt facilities include upfront issuance costs that are capitalized as part of the facilities’ respective carrying values. These facilities are fully prepayable at any time but may be subject to certain prepayment penalties.
The mezzanine term debt facilities have aggregated property borrowing bases, which increase or decrease based on the cost and the value of the properties financed under a given facility and time in the Company’s possession of those properties and the amount of cash collateral pledged by the relevant borrowers. The borrowing base for a given facility may be reduced as properties age or collateral performance declines beyond certain thresholds, and any borrowing base deficiencies may be satisfied through contributions of additional properties or cash or through partial repayment of the facility.
Covenants
The Company’s inventory financing facilities include customary representations and warranties, covenants and events of default. Financed properties are subject to customary eligibility criteria and concentration limits.
The terms of these inventory financing facilities and related financing documents require an Opendoor subsidiary to comply with customary financial covenants, such as maintaining certain levels of liquidity, tangible net worth or leverage (ratio of debt to tangible net worth). Certain of these financial covenants are calculated by reference to Opendoor Labs Inc. and its consolidates subsidiaries' assets and liabilities. As a result, under certain circumstances, this may limit our flexibility to transfer assets from Opendoor subsidiaries to the Parent Company. At September 30, 2023 and December 31, 2022, $300 million and $565 million, respectively, of the Company’s net assets were restricted as they reflect minimum net asset requirements at Opendoor Labs Inc. As of September 30, 2023, the Company was in compliance with all financial covenants and no event of default had occurred.
Mortgage Financing
In 2022, the Company ceased providing correspondent lending or mortgage brokering services. As a result, the Company no longer requires mortgage financing and terminated its master repurchase agreement (the “Repurchase Agreement”) in October 2022.
From March 2019 through its exit of mortgage lending and brokering services, the Company utilized the Repurchase Agreement to provide capital for Opendoor Home Loans. The facility, which was classified as a current liability on the Company’s condensed consolidated balance sheets, provided short-term financing between the issuance of a mortgage loan and when Opendoor Home Loans sold the loan to an investor. In accordance with the Repurchase Agreement, the lender agreed to pay Opendoor Home Loans a negotiated purchase price for eligible loans and Opendoor Home Loans simultaneously agreed to repurchase such loans from the lender within a specified timeframe and at an agreed upon price that included interest. Opendoor Labs Inc. was the guarantor with respect to the Repurchase Agreement and the obligation to repurchase loans previously transferred under the arrangement for the benefit of the lender. This financing arrangement was an important component of Opendoor Home Loans’ operations as a correspondent lender.
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
Convertible Senior Notes
In August 2021, the Company issued 0.25% senior notes due in 2026 (the “2026 Notes”) with an aggregate principal amount of $978 million. The tables below summarize certain details related to the 2026 Notes (in millions, except interest rates):
September 30, 2023
Remaining Aggregate Principal Amount
Unamortized Debt Issuance CostsNet Carrying Amount
2026 Notes$510 $(8)$502 
September 30, 2023Maturity DateStated Cash Interest RateEffective Interest RateSemi-Annual Interest Payment DatesConversion RateConversion Price
2026 NotesAugust 15, 20260.25 %0.78 %February 15; August 1551.9926$19.23 
The 2026 Notes will be convertible at the option of the holders before February 15, 2026 only upon the occurrence of certain events. Beginning on August 20, 2024, the Company has the option to redeem the 2026 Notes upon meeting certain conditions related to price of the Company's common stock. Beginning on February 15, 2026 and until the close of business on the second scheduled trading day immediately preceding the maturity date, the 2026 Notes are convertible at any time at election of each holder. The conversion rate and conversion price are subject to customary adjustments under certain circumstances. In addition, if certain corporate events that constitute a make-whole fundamental change occur, then the conversion rate will be adjusted in accordance with the make-whole table within the Indenture. Upon conversion, the Company may satisfy its obligation by paying cash for the outstanding principal balance, and, a combination of cash and the Company's common stock, at the Company's election, for the remaining amount, if any, based on the applicable conversion rate.
In March 2023, the Company entered into separate, privately negotiated transactions to repurchase a portion of the outstanding 2026 Notes (“Repurchased 2026 Notes”). The holders of the Repurchased 2026 Notes exchanged $189 million in aggregate principal amount for an aggregate payment of $101 million in cash for full settlement of the principal value and accrued interest on such date. The Company accounted for the repurchase as a debt extinguishment. Accordingly, on the repurchase date, the Company: (i) reduced the carrying value of the Repurchased 2026 Notes by $189 million, (ii) reduced outstanding deferred issuance costs by $3 million, (iii) incurred fees of $1 million and (iv) recorded $84 million of gain on debt extinguishment. The Company elected to leave the Capped Calls associated with the Repurchased 2026 Notes outstanding.
In May 2023, the Company entered into separate, privately negotiated transactions to repurchase a portion of the outstanding 2026 Notes (“Additional Repurchased 2026 Notes”). The holders of the Additional Repurchased 2026 Notes exchanged $279 million in aggregate principal amount for an aggregate payment of $169 million in cash for full settlement of the principal value and accrued interest on such date. The Company accounted for the repurchase as a debt extinguishment. Accordingly, on the repurchase date, the Company: (i) reduced the carrying value of the Additional Repurchased 2026 Notes by $279 million, (ii) reduced outstanding deferred issuance costs by $5 million, (iii) incurred fees of $1 million and (iv) recorded $104 million of gain on debt extinguishment. The Company elected to leave the Capped Calls associated with the Additional Repurchased 2026 Notes outstanding.
For the three and nine months ended September 30, 2023, total interest expense on the Company's convertible senior notes was $1 million and $4 million, respectively. For the three and nine months ended September 30, 2022, total interest expense on the Company's convertible senior notes was $2 million and $6 million, respectively.
Capped Calls
In August 2021, in connection with the issuance of the 2026 Notes, the Company purchased capped calls (the “Capped Calls”) from certain financial institutions at a cost of $119 million. The Capped Calls cover, subject to customary adjustments, the number of shares of the Company's common stock underlying the 2026 Notes. By entering into the Capped Calls, the Company expects to reduce the potential dilution to its common stock (or, in the event of a conversion of the 2026 Notes settled
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Notes to Condensed Consolidated Financial Statements
(Tabular amounts in millions, except share and per share amounts, ratios, or as noted)
(Unaudited)
in cash, to reduce its cash payment obligation) in the event that at the time of conversion of the 2026 Notes its common stock price exceeds the conversion price. The Capped Calls have an initial strike price of $19.23 per share and an initial cap price of $29.59 per share or a cap price premium of 100%.
6.FAIR VALUE DISCLOSURES
The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures.
Following is a discussion of the fair value hierarchy and the valuation methodologies used for assets and liabilities recorded at fair value on a recurring and nonrecurring basis and for estimating fair value for financial instruments not recorded at fair value.
Fair Value Hierarchy
Fair value measurements of assets and liabilities are categorized based on the following hierarchy: