In its first earnings report since launching as a publicly traded company, Rocket Companies – the parent of Quicken Loans and Amrock – had nothing but good news for its new investors.
Quicken Loans posted its most active and profitable quarter in the company’s 35-year history.
“While I’m proud of our performance, I am even more encouraged by the significant opportunity that remains in front of us as we continue to execute on our plan of achieving 25 percent market share by 2030,” CEO Jay Farner said in a release announcing the results. “It is clear that our simple, client-focused, digital approach is continuously and fundamentally disrupting the way our industries do business.”
Quicken Loans reported origination volume of $72.3 billion in the second quarter, its busiest quarter ever. That’s 126 percent above the second quarter of 2019, when the company originated $32 billion.
Profits totaled $3.46 billion in the quarter – a ridiculous 3,458 percent increase from the $97 million in first-quarter 2020 profits and a full $4 billion more than the $54 million loss posted in the second quarter of 2019.
Total revenue was $5 billion, up 437 percent from the $938 million in the second quarter of 2019. Adjusted earnings before income, taxes, depreciation and amortization (EBITDA) were $3.8 billion, 868 percent above the $396 million in the second quarter a year earlier.
The company said revenues from other services such as Amrock title insurance services, property valuation and settlement services also soared in the quarter as origination volume grew. Farner said the company didn’t expect a slowdown the rest of the year.
“As we look to the second half of the year, we continue to see strength and durability in consumer sentiment,” Farner said in a call with analysts, according to a transcript provided by Seeking Alpha. “Record-low interest rates and an improving U.S. real estate market continue to drive demand for home loans. The purchase market, in particular, continues to recover following COVID-related disruption in the second quarter. In fact, we expect the third quarter to be one of our best for purchase origination volume ever at Rocket Mortgage. Demand for a completely digital experience has never been stronger and Rocket is delivering.”
The company said it expects third quarter closed loan volume between $82 and $85 billion, more than 105 percent ahead of the third quarter of 2019, when it recorded $40.3 billion in closed loans.
Farner said the goal was to increase capacity to scale up to as much as $120 billion a quarter.
“By the end of the year, our goal is to have a platform that can close $40 billion a month,” Farner said, according to the Seeking Alpha transcript. “And so we will continue to grow that platform, the tech, the client experience, the brand and the people required.”