Rocket ‘built to grow in any rate environment,’ CEO says
The mortgage giant posted gains in revenue, income and adjusted EBITDA in Q3 — even as rising rates posed challenges within the industry.
Despite a stalled housing market and high mortgage rates, Rocket Companies announced on Oct. 29 that it more than doubled its net revenue year-over-year in Q3 and is moving toward the end of 2026 with confidence.
"For American families trying to buy a home, the math went from hard to punishing," Rocket CEO Varun Krishna said during a Thursday call with investors. "So why does Rocket win? It's no accident."
The company began rebuilding three years ago with the goal of creating "an ecosystem that serves clients from home search through servicing," he explained, with an emphasis on embracing new technology. Rocket is now "in a category of one: No. 1 in purchase, refinance, home equity and servicing."
What Rocket had to say
Unsurprisingly, Krishna and Brian Brown, Rocket's president, CFO and treasurer, both acknowledged that elevated mortgage rates aren't great for business. However, they said the mortgage giant has held its own and is in a position to seize opportunity when economic conditions improve.
On 'tough' market conditions: "Tough markets don't lie; they reveal what's real," Krishna said. "This quarter revealed a company that delivered revenue near the midpoint of guidance, expanded margins for the fourth straight quarter, and took share in purchase and refinance in one of the hardest markets this industry has ever seen."
When rates were high prior to Rocket's rebuild, "we lost money," he said. "Today, we make it. The rates didn't change; we did. We built Rocket to be the strongest ship in rough water. We're built to grow in any rate environment. We are not waiting for the market. We're taking the reins."
On growing through Redfin, Compass: Fifteen months after Rocket acquired Redfin for $1.75 billion, "Redfin's contribution to our refinance leads more than doubled" year-over-year in Q3, Krishna said. The company's partnership with Compass is also paying off. "Compass simply extends that same playbook and delivers what buyers want most: homes and the agents who sell them."
At this point, "1 in 5 of our purchase clients is represented by a Redfin or Compass agent," Brown said.
On AI lowering costs of doing business: "For most of this industry's history, a mortgage moved at the speed of paperwork and business hours. AI removes both limits," Krishna said.
While many lenders rent the tech they need, Rocket built its own, Brown explained. AI now handles many of the time-consuming tasks involved in the loan origination and servicing processes, which "keeps lowering our cost per loan."
"The traditional mortgage model adds capacity by adding headcount. We don't run the business that way," Brown said. "If the market remains soft, we can align our cost structure with demand and keep the capacity we need. When the market turns, others will be hiring to catch up. We'll already have the capacity in place."
Rocket is "not dependent on a rate recovery," Brown added, "but we're positioned to capture the upside when it comes."
Key numbers
Total net revenue: $3.28 billion in Q3, up significantly from $1.61 billion a year prior and up from $2.87 billion in Q2. Adjusted revenue came in at the low end of Rocket's guidance range of $2.5 billion to $2.7 billion.
Cash and cash equivalents: Rocket closed the third quarter with $2.7 billion in available cash, down from $5.8 billion in Q3 of 2025.
Net income: GAAP net income of $709 million, an improvement over the GAAP net loss of $124 million a year ago and up from $229 million in Q2. Adjusted net income was $419 million in Q3, above the $158 million reported a year earlier.
Adjusted EBITDA: $748 million in Q3, more than double the $349 million reported a year ago.
Q4 outlook: Rocket expects adjusted revenue to be in the $2.1 billion to $2.3 billion range, the company said.
Notable moves
Rocket began Q3 by hiring Jim Dalrymple, Inman's former editorial director, as principal of industry relations. A month later, the company expanded its board of directors with the addition of an independent member and, more recently, elevated a 22-year company leader to its C-suite.
Meanwhile at Redfin, Krishna ended his months-long stint as interim CEO — a role he stepped into following longtime leader Glenn Kelman's departure in January — with the hiring of former Meta exec Alessio Sanfilippo.