Rocket Companies, Inc. · NYSE:RKT
Rocket Companies — Q2 2023 Earnings Presentation
42 slides from Rocket Companies's earnings presentation, Aug 3, 2023
Slide 1: Rocket Companies Investor Presentation, August 2023
Rocket Companies Investor Presentation AUGUST 2023
Slide 2: Disclaimer
@ DISCLAIMER This presentation contains and related discussions may contain “forward-looking statements” within the meaning of U.S. federal securities laws. Forward-looking statements include information concerning possible or assumed future results of operations, Rocket Companies, Inc.'s (the “Comp
Slide 3: Starting with a simple idea...
(3) STARTING WITH A SIMPLE IDEA... In the early days of the internet era, our Founder and Chairman Dan Gilbert committed the company’s entire resources to moving online. Rocket continues to lead in driving transformative change in the mortgage industry. “WE MUST take this great technology to the int
Slide 4: Building a technology giant
(3) BUILDING A TECHNOLOGY GIANT ROCKET 2 9M + Welcome, Kim. 38 Rocket = Year Operating Accounts! History 1234 Main Street S1.6T+ Transaction Volume Since Remaining Loan Balance $200,000 © Inception| : \ a 7 75 90%+ Monthy autopay scheduled for October Net Client = Net Promoter $1,000 © Retention Rat
Slide 5: Our companies
(3) OUR COMPANIES HOME FINANCING PERSONAL FINANCE |HOME SEARCH & SALES ROCKET Sinesekdsenicer | ROSKET firctane | ROSKET | Eonsseushater amrock — [stoesetlomert | ROCKET escrains LENDESK anos Comse = Rocket Companies consists of personal finance and consumer technology brands including Rocket Mortga
Slide 6: Investment highlights
@) INVESTMENT HIGHLIGHTS Transforming complex transactions, driving long-term growth at scale. o 0 @ MASSIVE SUPERIOR FRAGMENTED CLIENT MARKETS EXPERIENCE TRUSTED, MULTIPLE PROVEN DIGITAL-FIRST AVENUES LEADERSHIP BRAND OF GROWTH AND CULTURE PLATFORM ADVANTAGE 6 of 42
Slide 7: Massive Fragmented Markets
ROCKET ‘Companies
Slide 8: Massive market opportunity
?) MASSIVE MARKET OPPORTUNITY Rocket competes in some of the largest, most complex segments of the economy: (©) MORTGAGE f REAL ESTATE (2) FINANCIAL SERVICES Source: Bureau of Economic Analysis, Bloomberg, National Association of Realtors, Mortgage Bankers Association, Edmunds, Research and Markets,
Slide 9: Buying a new home is the most stressful event
“Many Americans, about 40%, say buying a new home is the most stressful event in modern life.” - HOUSINGWIRE 9 of 42
Slide 10: Home ownership priorities are accelerating
(3) HOME OWNERSHIP PRIORITIES ARE ACCELERATING A demographic wave of almost 70M Americans aged 20-34 is entering home ownership for the first time, demanding digital transformation of the real estate experience. 15% of clients using online platform are first-time homeowners or Millennials 15-19 20-2
Slide 11: Strong client base unlocks platform potential
(3) STRONG CLIENT BASE UNLOCKS PLATFORM POTENTIAL 90%+ Retention drives substantial lifetime value advantages, with repeat transaction opportunities over the client's life. a4 29M+ 2.4M 90%+ Rocket Accounts Client Loans Net Client Serviced Retention Rate (2017-Q2'23) (1) See #3 in endnotes for our n
Slide 12: Rocket is positioned to lead our industries
(3) ROCKET IS POSITIONED TO LEAD OUR INDUSTRIES Our markets remain highly fragmented compared to other large industries that moved online earlier - like e-commerce, travel or tax prep. Rocket is positioned to lead the digital transformation of our industries. Source: Equity Research MARKET SHARE OF
Slide 13: Long-term mortgage market share gains
(3) LONG-TERM MORTGAGE MARKET SHARE GAINS ; | Rocket Originations ($ in B) —@— Rocket Market Share 8% @ 78% Both purchase and refinance market share grewindividually in 2022! Total market share in 2022 impacted by the dramatic mix shift from refinance to purchase 5.0% $145 2010 2011, 2012 2013 2014
Slide 14: Superior Customer Experience
Slide 15: Guided financial wellness at every step of the homebuying journey
1, GUIDED FINANCIAL WELLNESS Meet Lydia. She begins her financial journey with us by using the Rocket Money app to track her spending habits, credit score and more. Lydia also signs up for the Rocket Visa Signature® Card and starts banking Rocket Rewards points with every transaction. 2. TOOLS TO PR
Slide 16: Superior client experience
(3) SUPERIOR CLIENT EXPERIENCE In complex transactions where the legacy experience can be confusing and discouraging, Rocket provides simple, fast, and trusted digital solutions. ROCKET Mortgage Your Mortgage TRADITIONAL ROCKET INDUSTRY EXPERIENCE EXPERIENCE TRANSACTIONAL r—> PERSONALIZED CONFUSING
Slide 17: Extending client lifetime value
(3) EXTENDING CLIENT LIFETIME VALUE BEFORE CLIENTS ARE READY TO TRANSACT ROCKET Money © Rocket Rewards Other Rocket Client Engagement Programs ~ $13,500 ROCKET 450 bps $300K Mortgage? + $3,000 ROCKET 1% Real Estate Agent Commission + $1,500 AMROCK + $$$$ Repeat Transactions $18,000+ ROCKET ‘Companie
Slide 18: Digital-first, personalized experience
G) DIGITAL-FIRST, PERSONALIZED EXPERIENCE Rocket's proprietary technology delivers a seamless digital experience for our clients. PERSONALIZED EXPERIENCE REAL OPTIONS VERIFIED APPROVAL DIGITAL CLOSING ONE TAP TO LIVE EXPERTS @ © i) ® ROCKET Your Next Home “Ajourney of a thousand miles begins with a
Slide 19: Platform Advantage
2) , oa i Platform Advantage
Slide 20: Rocket's client engagement program
G) ROCKET’S CLIENT ENGAGEMENT PROGRAM With the foundational pieces of our client engagement program in place, we can serve our clients on every step of the homebuying journey. = ROCKET Your Next Home miles begins wth Buy a home for about $350,000 in December 2023 in Detroit,MI Cord Balance ito Net C
Slide 21: Platform benefits
PLATFORM BENEFITS We are focused on expanding our top of funnel, lifting conversion and lowering. our client acquisition cost, with the ultimate goal of growing our purchase market share and extending client lifetime value. oa (2) CO Grow Top Of Funnel & Lift Conversion Lower Client Activate Large C
Slide 22: Rocket Money: driving deeper client engagement
(3) ROCKET MONEY: DRIVING DEEPER CLIENT ENGAGEMENT R CKET Money Helping Consumers Manage Their Entire Financial Lives $100B+ Transaction Volume Analyzed/Month $100M+ Annualized Recurring Revenue Cancel Recurring Track Improve Subscriptions Charges Spending Credit Source: Company 22 of 42
Slide 23: Rocket Rewards: fostering client loyalty
@ ROCKET REWARDS: FOSTERING CLIENT LOYALTY +>) Rocket Rewards Rocket Rewards helps clients achieve their financial goals while continuing to drive value and brand loyalty for Rocket. OVER 2M USERS SIGNED UP + Accrue Reward Points across a range of activities + Redeem Reward Points to save money on h
Slide 24: Powered by proprietary technology stack
G) POWERED BY PROPRIETARY TECHNOLOGY STACK Proprietary technology developed in-house that drives our entire operating process. Proprietary Software Drives Entire Stack DIGITAL POINT-OF-SALE PARTNER API PLATFORM Digital Client Acquisition Software- Driven Workflows Client Servicing & Retention DATA S
Slide 25: Trusted Digital-First Brand
Slide 26: Primary Mortgage Origination and Servicing
PRIMARY PRIMARY MORTGAGE MORTGAGE SERVICING ORIGINATION
Slide 27: With national brand recognition
?) WITH NATIONAL BRAND RECOGNITION Rocket's trusted, nationally recognized, digital-first brand, backed by billions of dollars of investment over many years, is a competitive advantage that is difficult to replicate. Most Differentiated Brand in Mortgage! ROCKET wrtqage Classic © © © Rocket's 2022 S
Slide 28: Multiple Drivers of Growth
Multiple Drive OfGrowth |
Slide 29: Multiple drivers of growth
MULTIPLE DRIVERS OF GROWTH DIRECT-TO-CONSUMER + Investing in brand and client acquisition Current Mortgage Info + Growing digital adoption POWERED BY ROCKET Pro + Growing market penetration RETAINING CLIENTS FOR FUTURE TRANSACTIONS + 29.3M Rocket Accounts + 90%+ Net Client Retention! + Extend client
Slide 30: The Rocket flywheel
THE ROCKET FLYWHEEL The core of our economic flywheel is that we are constantly reinvesting in the business, further strengthening our competitive position. Consistent Fe On Efficiency THE ROCKET ECOSYSTEM 30 of 42
Slide 31: Proven Leadership and Culture
"TH © r Proven Le:
Slide 32: Rocket Companies leadership
ROCKET COMPANIES LEADERSHIP BILL EMERSON Board Director Rocket Companies President & COO Rocket Companies BRIAN BROWN CFO & Treasurer Rocket Companies TIM BIRKMEIER TINA JOHN President General Counsel Rocket Mortgage Rocket Companies 1 @ NICOLE BEATTIE DOUG SEABOLT CEO CEO Amrock Rocket Homes VARUN
Slide 33: Culture is our foundation
CULTURE IS OUR FOUNDATION @__ !nnovation is rewarded. Dan Gilbert, our founder Execution is worshipped. and Chairman, purposefully created a strong cultural foundation of core 2022 EDITION \ principles, or “ISMs,” as a cultural operating : system to guide ( @ You'llsee it when decision-making = you
Slide 34: Love our team members
LOVE OUR TEAM MEMBERS Our team members put the ISMs into action every day. The result is an empowered and passionate team aligned in a common mission. Great Lafeteo [oy ESSENCE Forbes Work Forbes ReOp ue FORTUNE FORTUNE FORTUNE @ @ @ e @ @ @ @ 2015 2018 2019 2021 2020, 2022 2020, 2021, 2022 2023 #1
Slide 35: For more than profit
(3) FOR MORE THAN PROFIT abate RA) SAMI AUC, SOCIAL AND GOVERNANCE REPORT Our company and community are inextricably linked, = S G serving as the foundation for our community investment, team member development and business growth strategies. R_CKET Companies #1 $200M+ 1M 100K+ Nation’s largest Cont
Slide 36: Appendix
Appendix
Slide 37: Financial highlights
(3) FINANCIAL HIGHLIGHTS (Units in ‘000s, $ in M) Adjusted Revenue $12,427 $4,628 $2,790 $1,125 $882 $1,002 $850-$1,000 * YoY Growth % (27%) (63%) (47%) (60%) (54%) (11%) * QoQ Growth% N/A N/A (31%) (42%) 29%) 14% Adjusted EBITDA $6,200 $59) $1,279 ($27) ($79) $18) *% Margin 50% 1% 46% 2% (9%, 2% Ad
Slide 38: Endnotes (1)
G) ENDNOTES (1) Three Months Ended June 30, Six Months Ended June 30, (Unaudited) (Unaudited) NET INCOME (LOSS) $139 $60 $(272) $1,096 Interest And Amortization Expense On Non-funding Debt 38 38 77 77 Income Tax (Benefit) Provision qa) 19 (5) 45 Depreciation And Amortization 25 25 56 46 Share-based
Slide 39: Endnotes (1)
G) ENDNOTES (1) Three Months Ended June 30, Six Months Ended June 30, (Unaudited) (Unaudited) TOTAL REVENUE, NET $1,236 $1,392 $1,902 $4,063 Change in fair value of MSRs due to valuation assumptions (net of hedges) (a) (235) en me) (1,006) ADJUSTED REVENUE $1,002 $1,125 $1,884 $3,057 (@)_ Reflects c
Slide 40: Endnotes
(3) ENDNOTES NET INCOME (LOSS) ATTRIBUTABLE TO ROCKET COMPANIES Net Income (Loss) Impact From Pro Forma Conversion Of Class D Common Shares To Class A Common Shares (a) Adjustment to the (Provision For) Benefit From Income Tax (b) TAX-EFFECTED NET INCOME (LOSS) (B) Share-based Compensation Expense (
Slide 41: Endnotes
ENDNOTES 2. “Adjusted EBITDA Margin” calculated as Adjusted EBITDA divided by Adjusted Revenue. 3. We define "net client retention rate" as the number of clients that were active at the beginning of a period and which remain active at the end of the period, divided by the number of clients that were
Slide 42: Rocket Companies
©) ROCKET Companies