RocketCos. announces second-quarter revenue drop of $1.3 billion

Detroit’s Rocket Cos. announced cost reductions to accompany the loss of $1.4 billion in revenue in the second quarter of 2021. // – Stock Image

RocketCos. Inc., a Detroit-based fintech platform company comprised of technology-focused real estate, mortgage and financial services businesses, announced its results for the second quarter (Q2) of 2022, which show lower net revenue from $2.7 billion in Q2 2021. billion to $1.4 billion, a loss that came with cost reductions.

Due to rising inflation in recent months, caused in part by overspending measures imposed by the Biden administration, interest rates have risen steadily. Additionally, many businesses are facing supply chain delays and a tight labor market.

“During this time of industry change, we are focused on operating our business with discipline. We reduced our expenses by approximately $300 million in the second quarter and will continue to take a cautious approach to cost management,” said Julie Booth, chief financial officer and treasurer of Rocket Cos.

“We are also investing our capital in the Rocket Engagement and Services Platforms to expand our customer base, drive higher conversion, and lower our customer acquisition costs, laying the foundation for our next stage of growth. We will continue to deploy our capital in a strategic and disciplined manner to generate long-term shareholder value. »

Platform net income fell to $60 million from just over $1 billion in Q2 2021. Adjusted revenue also took a hit, falling to $25 million from $2.7 billion in 2021. one year to the next. Its adjusted net income and adjusted EBITDA both fell into the negative – losing $67 million from a gain of $921 million and a loss of $27 million from a gain of $1.2 billion. dollars year over year, respectively.

Rocket Mortgage, the nation’s largest wholesale mortgage lender, saw closed loans fall from $83.7 billion to $34.5 billion, a decline of nearly $50 billion. Its profit margin on sale increased slightly, from 2.78% to 2.92%.

During the quarter, Rocket Cos. unified more of its business under the Rocket brand. In August, Truebill will change its name to Rocket Money, and Edison Financial – Canada’s digital mortgage broker – will change its name to Rocket Mortgage in Canada.

Rocket Money, formerly known as Truebill, has seen strong growth. Paid premium members surpassed 2 million users in July, which more than doubled year-over-year. Rocket Money launched its first beta credit card in Q2 to very positive initial response.

Rocket Mortgage’s net customer retention rate was 93% in Q2 2022. There is a strong correlation between this metric and customer lifetime value, and Rocket says its net customer retention rate is “unmatched among mortgage companies and on par with some of the top performing subscriptions. economic models around the world.

Rocket Homes increased overall real estate transactions 25% over the prior year, landing two record months in the quarter for closed units. Rocket Homes web traffic has increased by nearly 60%, reaching nearly 3 million unique visitors per month.

Rocket Solar continued its national expansion in June and is now available in 42 metro areas, including Arizona, Florida and South Carolina. Starting in August, Rocket Solar will work with Rocket Loans to provide solar financing options to our customers.

In related newsRocket Mortgage and Santander Bank, one of the nation’s leading retail and commercial banks, today announced Rocket Mortgage as the exclusive provider of preferred mortgages for Santander Bank customers.

Through this relationship, Santander customers will receive exclusive discounts and dedicated resources to help them realize their dream of owning a home.

“At Santander, we put the customer at the center of our business, and I’m excited to work with Rocket to deliver a convenient and streamlined digital mortgage experience for our customers,” said Patrick Smith, Head of Personal and Commercial Banking at Banco Santander.

“Our relationship with Rocket Mortgage is another example of how Santander Bank is evolving our business and continuing to seek out opportunities for our customers to save, invest and manage their money in Santander.”

In addition to the dedicated resources provided to Santander customers, Rocket Mortgage will offer rebates on loan costs and closing costs with enhanced discounts for private customers and Santander employees who close loans under the program.

“This relationship between Rocket Mortgage and Santander is a perfect fit. Both companies are passionate about delivering exceptional customer experiences,” said Bob Walters, CEO of Rocket Mortgage.

“Rocket has spent decades developing cutting-edge technology to facilitate every step of the mortgage process. We are excited to deliver a world-class experience for Santander customers. This is just the beginning of what we believe to be long relationship between our companies as we innovate together to develop new ways to delight our customers.

Santander Bank has nearly 2 million customers, primarily located in Massachusetts, New Hampshire, Connecticut, Rhode Island, New York, New Jersey, Pennsylvania and Delaware.

Santander customers can visit santanderbank.com/mortgages to start the home loan process or learn more about this relationship.

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