Rocket Companies delivered first quarter results that missed Wall Street’s revenue expectations, as management attributed the year-on-year sales decline to a challenging housing market and a sharp reversal in market momentum during April. CEO Varun Krishna pointed to higher mortgage rates and declining consumer sentiment as key factors that caused home purchase applications to fall, noting, “Weekly purchase applications actually declined by double digits throughout April, which the industry hasn’t experienced since 2009.” Despite these headwinds, management highlighted improvements in operational productivity, including a 21% increase in origination clients and efficiency gains driven by their AI platform.

Is now the time to buy RKT? Find out in our full research report (it’s free).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions Rocket Companies’s Q1 Earnings Call

• Ryan Nash (Goldman Sachs) asked how market volatility, elevated expenses, and acquisition integration would impact 2025 revenue and operating leverage. CEO Varun Krishna and CFO Brian Brown acknowledged April’s weakness but said May and June were showing improvement, and expect marketing expenses to decline in the second half.
• Mark DeVries (Deutsche Bank) questioned the subservicing strategy post-merger with Mr. Cooper, given recent client defections. CFO Brian Brown stated Rocket fully supports the subservicing business, intends to honor all contracts, and expects to benefit from Mr. Cooper’s scale.
• Doug Harter (UBS) inquired about investments in Rocket Pro and the outlook for the broker channel. CEO Varun Krishna outlined a renewed focus on technology, broker empowerment, and business model innovation, expecting momentum to accelerate with recent enhancements.
• Bose George (KBW) probed whether Rocket would pursue further acquisitions to grow purchase market share. Krishna emphasized the current priority is integrating Redfin and Mr. Cooper, with no immediate plans for additional acquisitions.
• Jeff Adelson (Morgan Stanley) asked about growth in operational capacity driven by AI and potential cost reductions if volumes disappoint. Krishna described AI’s role in expanding capacity, while Brown highlighted the flexibility to convert excess capacity into cost savings if needed.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be monitoring (1) the pace and effectiveness of Redfin and Mr. Cooper integration, (2) the impact of AI-driven automation on operational capacity and expense management, and (3) signs of sustained recovery in home purchase applications as market volatility subsides. The trajectory of marketing spend and competitive positioning in the broker channel will also be important factors to track.

Rocket Companies currently trades at $14.00, up from $11.64 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).

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