Rocket ‘executing ahead of plan’ with profitability at 4-year high
A year after closing its acquisition of Redfin, the mortgage giant said the share of buy-side clients coming in through the portal is nearing its target level.
Rocket Companies nearly doubled its revenue year-over-year but reported a slight quarterly drop in Q2 — not surprising, according to President, CFO and Treasurer Brian Brown, as "the expected housing recovery in 2026 has not materialized."
"Last quarter, we told you our real-time data indicated a tougher market than industry forecasts suggested, and that is exactly how the second quarter played out," Brown told investors during an Aug. 6 earnings call.
While the mortgage giant entered the real estate brokerage space over a year ago through its acquisition of Redfin and also absorbed rival lender Mr. Cooper in 2025, CEO Varun Krishna says the company is "not assembling a collection of products" but "building a business where every product makes every other product more valuable."
Over 70% of Rocket's revenue "is now less rate sensitive," Krishna said, which "allows us to keep investing" while competitors are "forced to react."
"We expect that to become a structural advantage that will continue to be a strength for us in Q3," Krishna added.
What Rocket had to say
On Redfin: Redfin is "paying dividends" for Rocket, Brown said during Thursday's call. "Mortgage leads from Redfin in June doubled year-over-year" while "the percentage of Redfin buy-side clients who finance with Rocket Mortgage has reached 47% — approaching our 50% target," he said.
"Since completing the Redfin and Mr. Cooper transactions in the back half of last year, we have grown share and expanded profitability for three straight quarters across both rising and falling rate environments."
On partnering with Compass: The deal Rocket announced earlier this year allowing Compass to display private listings on Redfin is also paying off, Krishna said.
"Through our Compass partnership, Rocket Pro brokers have originated more than $2 billion of net rate lock volume," he told investors. "Consumers, agents and brokers all benefit from a more connected experience, and every additional participant strengthens that network. Those advantages compound over time."
On the sluggish market: Rising mortgage rates and softening demand "tested the housing industry" in Q2, Krishna acknowledged, "but against that backdrop, Rocket reached record market share in both purchase and refinance, delivered its most profitable quarter in four years and continued executing ahead of plan."
Rocket is building a business "with a stronger floor in difficult markets and significantly more upside when housing activity returns," Krishna said.
"Competitors may have pieces of this model. No one has integrated it the way that Rocket has," he added. "That's why we believe Rocket's long-term earnings power is stronger than at any point in our history."
Key numbers
Total net revenue: $2.78 billion in Q2, up from $1.45 billion a year prior but down from $2.94 billion in Q1. Adjusted revenue came in near the middle of Rocket's guidance range of $2.7 billion to $2.9 billion.
Cash and cash equivalents: Rocket closed out the second quarter with $3.1 billion in available cash, down significantly from $5.1 billion in Q2 of 2025.
Net income: GAAP net income of $229 million, a big improvement over the GAAP net income of $34 million a year ago but down from $297 million in Q1. Adjusted net income was $441 million in Q1, well above the $75 million reported a year earlier.
Adjusted EBITDA: $766 million in Q2, more than four times the $172 million reported a year ago.
Q3 outlook: Rocket expects adjusted revenue to be in the $2.5 billion to $2.7 billion range, the company said.
Notable moves
Following its decision to partner with Compass, Redfin in April made a public pitch to Northwest MLS — which has taken a strong stance against pre-market and private listings — to reconsider its policies.
A month later, Redfin debuted "Early Access," a listing category that provides sellers with an option that doesn't accrue days on market or display a home's price-drop history.
Meanwhile, Rocket has made a couple of changes to its legal and industry relations teams over the past few months. The company added Ben Schwartz as general counsel in May and tapped Inman's former editorial director, Jim Dalrymple, to serve as principal of industry relations in July.