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Can Artificial Intelligence (AI) Help Turn Opendoor’s Business Around?

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Key Points

  • Opendoor recently appointed Shrisha Radhakrishna as its new interim leader.

  • Radhakrishna believes artificial intelligence can help the company in multiple areas of its operations, including pricing and in-home assessments.

  • The company has routinely incurred losses and it’s carrying more than $2 billion in debt on its books.

  • 10 stocks we like better than Opendoor Technologies ›

Artificial intelligence (AI) has been transforming businesses across the globe and across all sectors of the economy. While it may not necessarily fix a broken business, it can help add efficiency, unlock new growth opportunities, and drive down costs.

Those are all things that Opendoor Technologies (NASDAQ: OPEN) could benefit from. Many investors and analysts see the iBuying company as nothing more than the latest meme stock, benefiting from a flurry of hype from retail investors.

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Management, however, hopes to solidify its operations and do more with less, due to AI. Is this a great idea that could make Opendoor a better buy, or is this simply too risky of a stock to hold?

Image source: Getty Images.

Can AI fix the company’s biggest struggles?

Opendoor’s new president and interim leader, Shrisha Radhakrishna, who took over last month after Carrie Wheeler stepped down, is eyeing AI as a way to improve the company’s operations. Radhakrishna sees many ways that AI can be a key part of the company’s future growth, helping the business with marketing, pricing, and in-home assessments.

Turning to AI can be a way to improve efficiency, but it’ll take time and money to do so. And even then, it’s questionable how much generative AI can do for Opendoor’s business. Consider that the company’s gross margin is typically in just single digits. The iBuying business involves flipping houses and if there’s not enough of a spread there to make enough of a margin, it’s going to be incredibly difficult for the business to cover its other operating expenses and stay out of the red.

AI may help with pricing, but unless it results in significant margin expansion, it may not necessarily lead to a big payoff for the business and its shareholders.

Many AI projects are falling short of expectations

Excitement around AI has captivated investors, but that doesn’t mean that simply throwing money at AI is going to solve problems. In fact, it may create new ones as Opendoor spends excessively without having much to show for it.

According to a recent report from the Massachusetts Institute of Technology, a staggering 95% of companies haven’t been generating any meaningful revenue or payoff from their investments into AI. While the hyperscalers and big tech companies with massive budgets have undoubtedly grown their businesses due to AI, the study underscores the importance of keeping expectations in check.

As tempting as it may be to assume that AI will improve a company’s operations, that’s by no means a sure thing. And that can be particularly concerning for a business such as Opendoor, which has routinely posted losses and which already has more than $2 billion in debt on its books. Last quarter (which ended June 30), its interest expense totaled $36 million — nearly 3 times the size of its operating loss of $13 million.

Investing into AI likely won’t make Opendoor a better stock

Opendoor’s business needs a lot of work before it can have a realistic path to profitability and be a good investment option. There’s a ton of risk for investors to take on and although the stock has surged more than 300% this year (as of Monday), that doesn’t mean the rally is sustainable or that it will continue.

The volatility that comes with Opendoor’s stock makes it an unsuitable option for the vast majority of investors to consider for their portfolios. With challenging market conditions, poor financials, and many question marks surrounding the long-term viability of Opendoor’s business, this is a stock I’d steer clear of for the foreseeable future. At the very least, you may want to wait until the company actually shows some tangible improvement and payoff from its efforts and AI investments. Otherwise, you could be taking on significant risk. This is a stock that could have a long way to fall given its sharp rally this year and the volatility that comes with it.

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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.



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AI Is Automating Technical Skills. Here Are the Soft Skills You Need.

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If hard skills are increasingly being automated, employers are shifting focus to what AI can’t replicate: creativity, empathy, critical thinking, and other essential soft skills.

For years, technical abilities were king, but the tide may be turning.

Indeed’s Hiring Lab took a look at job postings and analyzed which soft skills were listed. The top were communication, leadership, and organizational prowess. Forty-three percent of all job listings had at least one soft skill advertised.

Soft skills show up in job postings across industries, but maybe not where you’d expect:

In a world where machines can write code and analyze spreadsheets, the need for human insight, emotional intelligence, and creativity has never been more critical.

Employers don’t just want workers who can do the job; they want people who can collaborate, innovate, and lead.

Sign up for BI’s Tech Memo newsletter here. Reach out to me via email at abarr@businessinsider.com.





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How AI Can Support Healthcare Supply Chains With Predictive Tools

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Archie Mayani is the chief product officer at GHX, a global supply chain company that uses data and cloud-based technologies to connect healthcare providers like hospital systems and their suppliers.

For more than 20 years, Mayani has worked on clinical and supply-chain health technologies at companies like Change Healthcare and United Health Group.

At GHX, Mayani works to ensure that the company develops technology that can help hospitals procure patient supplies — like implants and IV fluids — as seamlessly as possible. By using AI-powered technologies that can anticipate supply chain disruptions, prioritize them in order of most critical, and identify substitutions, hospitals can be better equipped to provide effective patient care.

Business Insider interviewed Mayani about what sets healthcare apart from other industries when it comes to AI implementation.

This interview has been edited for length and clarity.

Rachel Somerstein: How is healthcare unique as an industry, particularly when we think about the integration of AI?

Archie Mayani: I’m based in Silicon Valley, where everybody wants to fail fast and move forward. But healthcare is very different from other sectors using AI.

When you are building a dating app and your AI hallucinates, it’s kind of funny and makes a great first-date story. When you have a patient on the operating table and you don’t have the right supplies delivered at the right time, it’s scary.

Can you talk about the goals of AI implementation in healthcare supply chain management?

Healthcare is about patient safety and how you use technologies responsibly, always putting the patient in the center. When we think about supply chain management, it’s almost like an invisible operating system in this shared ecosystem of patient care and delivery.

GHX’s mission with AI implementation revolves around delivering the right supplies at the right time to improve the quality of care and make it more affordable.

How did you arrive where you are now?

We have been leveraging AI and machine learning for the last 15 years. A lot of our work during the pandemic involved making supply disruptions more visible, with the goal of making supply chains more resilient and proactive.

One of the most important cases we thought about, coming fresh off the pandemic, was, “Can we look at backorder anticipation?”

It doesn’t matter what the cause is — it can be geopolitical conflict or meteorological tragedies. It could be that a trailer was dislodged and now we’ve lost the supplies on the freeway. But if we can anticipate back orders, we can anticipate disruption.

If the system is intelligent enough, it could recommend nearby substitutes within your distributed area. We started there, on a path of, “We’re going to build this machine-learning model that’s going to be intelligent, anticipate these disruptions, and make substitution recommendations.”

Where is AI in supply chain management working best right now?

We have an agile development approach at GHX, where our customers give us live feedback. We had an “aha” moment from our customers: They said, “This is absolutely what we’ve asked for for the past 20 years. You are starting to predict all of these disruptions, but the disruption of a Band-Aid is not the same as a disruption of IV fluid.”

They asked, “Can you make this technology even more intelligent for what I need, depending on where I think my most critical risks are and what kind of care delivery is most important to my organization?”

So we came up with the idea of clinical sensitivity and a confidence score, essentially to validate whether disruptions are clinically relevant to specific customers.

That was one of the things that changed the trajectory of our AI implementation road map: Just because we can deliver insights doesn’t make them useful; they have to be predictive and personalized.

What does the future of AI in healthcare supply chain management look like?

Since healthcare is different and unique from other industries, our approach is to automate workflows as much as possible using agents while keeping a human in the loop. Once the customer feels confident, we can start fully abstracting those workflows so that AI agents are handling them entirely.

The other place gaining traction is copilot environments. For example, we have a product called the perfect order dashboard, which marries data insights. A customer may say, “Show me the view of my world, of where the supplies are, of where I’m doing an exceptional job with my suppliers getting those supplies on time, making sure that the orders and invoices are paid on time, and show me all of the discrepancies.” Still, that’s not enough.

The copilot allows you to tell a story with that data, very similar to a ChatGPT-like experience: “Show me the top three defaulting suppliers not delivering supplies on time.”

Once you have those supplier lists generated, you can say, “Send an email to XYZ supplier, making sure we have a quarterly business review scheduled, and please attach the perfect order dashboard view showing the last quarter’s trend.”

It might seem small, but it’s a huge value-add. It used to take maybe three or four hours to understand the data, extract insights, and drive follow-up actions and decisions. Now, it takes minutes.

What advice do you have for others in your position or who hope to be?

The hardest or most useful thing you can do is to say no.

In healthcare, everything is urgent — and it truly is. But not everything matters equally. So, the ability to say no to the right things and ensure that you’re focusing on the highest value-added items for your customers is critical when you’re in healthcare.

Big Tech, or even a smaller tech startup, can innovate as research labs and fail. We don’t have that option. So understanding what matters now, what will matter in 10 years, and finding the right balance to focus on the right innovations, becomes critical.

It’s about having the right data, the right governance and mechanisms, and always thinking about performance, security, and privacy. It’s also about making responsible choices on where to invest your energy, so that you’re ultimately not working on the sexiest, coolest, or hardest things.

It comes back to the patient: making care affordable and of the highest quality possible.





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Hundreds of Hull families to get school uniform money

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More than 1,000 students will get extra help with school uniform costs, Hull City Council has said.

Next month, Year 7 pupils in Hull who receive free school meals will be given a £50 uniform voucher – £10 more than in previous years.

The money, from the government’s Household Support Fund, will be distributed to families before the October half term.

Council leader Mike Ross said: “We are absolutely aware that we are still in a cost of living crisis, so we hope these increased grants can help make a difference.”

Ross added: “We know that £50 won’t cover every item of uniform, which is why we’ve called on the government to provide additional support to local authorities like Hull to be able to provide more help for children from low-income families.

“Having been asked to look at the level of funding for school uniforms by full council, I know it was the right move to increase the amount available for those in need.”



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