Rocket Mortgage Impresses With $1.2 Billion Earned in Q1 2024

As the economy waivers recently—with mortgage rates back up above 7%, the most recent PCE report demonstrating a rise in inflation and no respite in the interest rates from the Fed yet—there’s been a lot of uncertainty surrounding the mortgage market. 

This uncertainty, however, does not seem to have affected Rocket Mortgage, as its Q1 2024 earnings report came in well above executive—and industry—expectations.

The company reported an adjusted revenue of $1.2 billion in its recent Q1 2024 earnings call on Thursday, May 2. Back in its Q4/full year 2023 earnings call, Rocket executives stated they expected an adjusted revenue of between $925 million to $1,075 million for this quarter, and ended up achieving about 1000x that.

This success follows a strong finish to 2024 with an adjusted revenue of $885 million in Q4 2023 and $3.8 billion for the full year of 2023.

“Never has this mission been more important, more relevant than it is right now. I am so proud of what our team has achieved together in this short time, and it’s evident you’re only at the beginning of our journey,” said Rocket CEO Varun Krishna. “As an organization, we are driven to execute and win and our determination is absolute. We’re playing both the short and the long game, gaining momentum and achieving success, while strategically planning and executing for the long term, and this has already led to some impressive results for Rocket.”

Along with their high adjusted revenue, Rocket saw an adjusted net income of $84 million and generated $20.2 billion in closed loan origination volume—up 19% from Q1 2023.

Krishna attributes the astounding Q1 success to a few different aspects of the company.

“There are three strategic levers that really come together in a durable way to enable our growth and share now and in the future,” he explained. “The first one is just innovation. We’re betting big on AI experiences. We’ve simplified our funnel. We’ve got better personalization, more automation. The second thing is just our internal focus. We’ve streamlined our execution. We’ve got more dedicated autonomous teams with clear goals. So, we’ve just improved our process. The third thing is just our top of the funnel. We’re meeting clients where they are. We’ve improved performance marketing. We’ve got better optimizations to improve our creative, our lead flow. We’ve got better engagement with our servicing portfolio. We’ve got better search and engagement experiences to nurture relationships with Rocket Homes and Rocket Money.”

Krishna continued, “The bottom line is, I mean, what you see is in our results, and you see it in the market dynamics. So, we definitely see that as an accelerator.”

In their Q4 2023 earnings call Rocket executives stated they were focusing their efforts on technology and AI to continue to grow their success and fight the tides of economic changes in the mortgage market. 

Following through with this, Rocket unveiled its AI platform Rocket Logic in April, which has already produced a 25% decrease in turn-around times from August 2022 to February 2024, allowing the company to process loans 2.5 times faster.

While the full potential of earnings Rocket Logic offers has yet to be seen, and despite the upcoming shifts to be felt in the industry following NAR and others’ settlements in recent commission lawsuits, executives feel that their success will only grow. 

“You’ve got rates that are kind of moving a little bit in the wrong direction. You’ve got MBA data that’s showing that mortgage applications are lower than expected. But when you step back from that, we firmly believe that the dynamics of the market are going to be favorable to Rocket,” said Krishna.

Looking ahead to Q2 2024, executives stated they expect an adjusted revenue between $1.075 billion to $1.225 billion.

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