Rocket touts ‘all-weather business model’ after acquisitions
Rocket posted a significant loss in Q1 but said its recent deals create a “super funnel” for the company and a “beautiful, end-to-end experience” for consumers.
Key points:
- The company’s acquisitions of Redfin and Mr. Cooper will be a “powerful springboard for growth,” said Rocket CEO Varun Krishna.
- But they came with a price: Rocket posted a net loss of $212 million for the first quarter, a reversal from a year ago when net income was nearly $300 million.
- Krishna said 2025 will be a year of “evolution,” and the integration of the three companies will put Rocket “on a path for 2026 to be revolutionary.”
Though Rocket Companies reported a net loss during its first-quarter earnings call on May 8, CEO Varun Krishna voiced optimism about the future as he spoke of the mortgage giant's recent acquisitions of Redfin and Mr. Cooper.
Rocket reported $1 billion in net revenue for Q1 of 2025, down $0.4 billion year-over-year and down $0.8 billion from the end of 2024. The company had a net loss of $212 million — a major reversal after reporting $291 million in net income a year ago.
But change is coming — and Rocket is ready to embrace "a balanced business model and a powerful springboard for growth" once the Redfin and Mr. Cooper teams are in place, according to Krishna.
"These acquisitions are fundamentally about three things: Strengthening our business models, fueling our platform with data and ecosystem partners to power Rocket's AI, and building an elevated client experience," he told investors. Together, they will create "an ecosystem designed for client success, professional empowerment and partner growth."
"We're excited to join forces and lead the future of homeownership together," Krishna said. "We believe if 2024 was foundational, 2025 will be evolutionary, on a path for 2026 to be revolutionary."
How we got here
In early March, Rocket announced that it was acquiring Redfin in a $1.75 billion deal. The brokerage will keep its brand, and Redfin CEO Glenn Kelman will remain its leader.
At the time, Krishna lauded Redfin's "data powerhouse" and said the two brands will together "form a technology company with the national scale of a lender, brokerage, title company and home-search site" to "do stuff we could've only dreamed about before."
Talks with Rocket began in November 2024, Kelman later told the Seattle-based Puget Sound Business Journal, and he'd worried that an acquisition by any other company would have left Redfin to be "stripped for parts."
A few weeks after the Redfin deal, Rocket announced it was also acquiring Mr. Cooper — one of its major competitors — in a $9.4 billion all-stock deal. With Mr. Cooper's clients, Rocket will oversee one in every six mortgages in the U.S.
Eyeing an 'end-to-end' consumer experience
Integration will be Rocket's "top priority" as the three companies join forces, Krishna said, calling it a win for consumers.
"Instead of a fragmented and costly process, they'll be able to search, buy, finance and manage their home in one modern, fully connected, beautiful, end-to-end experience," Krishna said.
Rocket Chief Financial Officer and Treasurer Brian Brown echoed this point as he told investors the new consumer experience will be "built for efficiency, reach and client value."
"These acquisitions give us a durable, all-weather business model with a diverse revenue base and a strong foundation for growth," Brown said. "The combination of Rocket, Redfin and Mr. Cooper provides a true super funnel with low customer acquisition costs, shared infrastructure and end-to-end connectivity across the homeownership journey.