Risk Factors Update Summary

• Increased regulation and risks associated with AI development and deployment, including potential legal liabilities.
• The company transformed the home selling and buying process into a digital, on-demand experience. This change resulted in over 246,000 homes bought and sold, with $18.9 billion in revenue in 2023.
• Incorporating AI capabilities may lead to litigation risk, non-compliance risks, and unknown compliance costs.
• The company reduced the number of markets operated in from 53 to 50 as of December 31, 2023, focusing on markets with deeper penetration and potential for growth.
• Risks related to the use of AI in business operations, including data privacy, security, and operational vulnerabilities.
• The company adjusted its inventory valuation, recording a $65 million inventory valuation adjustment in 2023, with $23 million related to homes remaining in inventory at the end of 2023.
• The company incurred net losses of $662 million in 2021, $253 million in 2020, and $1.4 billion in 2022, impacting its accumulated deficit and future profitability.
• The company launched its 3P listing and marketplace products in a limited number of markets in 2022, focusing on refining the seller experience and driving efficiencies.
• The company made significant changes to its product offerings, including the launch of the 3P listing and marketplace products, with plans to expand into more markets over time.
• The company adjusted its transaction costs, increasing from 0.25% to 0.50% as of December 31, 2023, impacting its financial results and operations.