Fri, May 9, 8:13 PM (14 days ago)
### Summary of Rocket Companies, Inc. (RKT) Q1 2025 Financial Performance **Financial Health and Performance Metrics:** - **Revenue:** $1,037.3 million, down from $1,383.7 million in Q1 2024. - **Net Loss:** $212.4 million, compared to a net income of $290.7 million in Q1 2024. - **Adjusted EBITDA:** $169.0 million, a decrease of $5.3 million from $174.3 million in Q1 2024. - **Cash and Cash Equivalents:** $1.4 billion, an increase of $535.2 million from Q1 2024. - **Equity:** $8.6 billion, a slight decrease of $25.8 million from Q1 2024. **Revenue Breakdown:** - **Gain on Sale of Loans, Net:** $771.6 million, up 10% from $699.2 million in Q1 2024. - **Servicing Fee Income:** $400.7 million, up 16% from $345.7 million in Q1 2024. - **Interest Income, Net:** $28.1 million, down 25% from $37.5 million in Q1 2024. - **Other Income:** $286.1 million, up 17% from $244.7 million in Q1 2024. **Expenses:** - **Total Expenses:** $1.3 billion, up 16% from $1.1 billion in Q1 2024. - **Marketing and Advertising:** $275.6 million, up 34% from $206.3 million in Q1 2024. - **Salaries, Commissions, and Team Member Benefits:** $609.6 million, up 13% from $541.1 million in Q1 2024. **Segment Performance:** - **Direct to Consumer:** Adjusted revenue of $1.0 billion, up 16% from $873.4 million in Q1 2024. - **Partner Network:** Adjusted revenue of $113.7 million, down 33% from $170.3 million in Q1 2024. **Liquidity and Capital Resources:** - **Total Liquidity:** $8.1 billion as of March 31, 2025. - **Available Cash and Corporate Cash:** $1.4 billion and $1.5 billion, respectively. - **Undrawn Lines of Credit:** $3.2 billion from financing facilities and $2.0 billion from MSR lines. **Future Operations Impact:** - **Pending Acquisitions:** Redfin and Mr. Cooper acquisitions expected to complete in 2025. - **Up-C Collapse:** Simplification of organizational structure to enhance equity liquidity and corporate profile. - **Market Uncertainties:** Inflation, interest rates, and housing affordability challenges. **Trends and Uncertainties:** - **Inflation and Interest Rates:** Inflation above Federal Reserve’s 2% target, federal funds rate held steady. - **Housing Market:** Limited inventory, macro uncertainty, and rate volatility affecting mortgage activity. - **Acquisitions:** Potential integration challenges and regulatory approvals for Redfin and Mr. Cooper acquisitions. **Conclusion:** Rocket Companies, Inc. faced a challenging quarter with a significant net loss and decreased revenue compared to Q1 2024. However, the company maintains strong liquidity and is pursuing strategic acquisitions to enhance its market position. The upcoming acquisitions and organizational changes are expected to drive future growth, but market uncertainties and integration risks remain.