Rocket Companies, Inc. · NYSE:RKT
Rocket Companies — Q4 2023 Earnings Presentation
38 slides from Rocket Companies's earnings presentation, Feb 22, 2024
Slide 1: Rocket Companies Investor Presentation
Rocket Companies Investor Presentation FEBRUARY 2024
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 resources to moving online. “WE MUST take this great technology to the internet.” - DAN GILBERT, 1998 3 of 38
Slide 4: Building a technology giant
(3) BUILDING A TECHNOLOGY GIANT J.D. Power Awards S1.7T+ Transaction Volume Since Inception| : 14 Net Promoter Score! Sources: Company information (1) Net Promoter Score as of December 31, 2023 (2) See endnote #3 in Appendix for definition of our net client retention rate. Since 2017, our net client
Slide 5: Our enabling AI-fueled homeownership
OUR ENABLING AI-FUELED ees HOMEOWNERSHIP
Slide 6: Investment highlights
@) INVESTMENT HIGHLIGHTS Poised to redefine and lead the homebuying category through Al @ MASSIVE SUPERIOR TECHNOLOGY FRAGMENTED CLIENT & DATA MARKETS EXPERIENCE ADVANTAGE SCALED PROVEN GROWTH & LEADERSHIP PROFITABILITY & CULTURE 6 of 38
Slide 7: Massive Fragmented Markets
ROCKET ‘Companies
Slide 8: Massive market opportunity
?) MASSIVE MARKET OPPORTUNITY Rocket operates in some of the largest segments of the economy, areas that are highly fragmented and ripe for disruption () MORTGAGE f= REAL ESTATE (2) FINANCIAL SERVICES Source: Bureau of Economic Analysis, Bloomberg, National Association of Realtors, Mortgage Bankers
Slide 9: 94% of Americans view homeownership as vital
G) 14 94% OF AMERICANS view homeownership as a vital part of the American dream.
Slide 10: Homeownership priorities are accelerating
(3) HOMEOWNERSHIP PRIORITIES ARE ACCELERATING A demographic wave of almost 70M Americans aged 20-34 are entering homeownership for the first time, demanding a modern, digital experience. 15% of clients using online platforms are first-time homeowners or Millennials 15-19 20-24 25-29 30-34 45-49 Curr
Slide 11: Rocket is positioned to lead our industries
(3) ROCKET IS POSITIONED TO LEAD OUR INDUSTRIES The homebuying industry is large, fragmented and ripe for disruption. Similar large industries have modernized and moved online earlier. Rocket aims to revolutionize homebuying through Al and our market opportunity is massive. Source: Equity Research M
Slide 12: $400 $350 $300 $250 $200 $150 $100 $50 $-
$400 $350 $300 $250 $200 $150 $100 $50 $-
Slide 13: Superior Client Experience
Slide 14: Primary mortgage origination and servicing
PRIMARY PRIMARY MORTGAGE MORTGAGE SERVICING ORIGINATION
Slide 15: Superior client experience
SUPERIOR CLIENT EXPERIENCE Rocket blends the human touch with technology to offer solutions that provide speed, certainty and value. ROCKET Mortgage TRADITIONAL ROCKET INDUSTRY EXPERIENCE EXPERIENCE _ Your Mortgage ANTIQUATED —+ | DIGITAL — “ STRESSFUL —> | SEAMLESS TIME-CONSUMING ;—>, FAST UNCERTAI
Slide 16: Extending client lifetime value
(3) EXTENDING CLIENT LIFETIME VALUE We aim to deliver industry-best experiences to our clients throughout their lives as homeowners. a [= =) cy) RO ROCKET AMROCK TRANSACTIONS $13,500— + — $3,000 —+— $1,500 —+— $$$ Refinance 450 bps $300K 1% Real Estate Home Equity Loans Personal Loans Rocket Money C
Slide 17: Technology & Data Advantage
@~ ) Gi ) aif 2 Technology & Data Advantage
Slide 18: Well-positioned to leverage AI
G) WELL-POSITIONED TO LEVERAGE AI At Rocket, we have a strong foundation in place and a wealth of assets at our fingertips to leverage generative Al and revolutionize the homebuying process. 10 3.7 30 PETABYTES BILLION MILLION OF DATA AI-GENERATED CUSTOMER CALL LOGS ANNUALLY INTERACTIONS AND DECISIO
Slide 19: AI-powered digital experiences
(3) AIl-POWERED DIGITAL EXPERIENCES Rocket is aggressively deploying Al across the organization to deliver better client experiences and to unlock team member productivity. Personalized Service+ Speed and Accuracy so ay BANKING Al turbocharges our mortgage bankers, enabling them to focus on advising
Slide 20: AI-powered, personalized experience
(3) AI-POWERED, PERSONALIZED EXPERIENCE Rocket's Al-powered technology delivers a seamless and efficient experience for our clients. © FAST AND TRANSPARENT PERSONALIZED EXPERIENCE INTEGRATED END-TO-END 24/7 SELF-SERVICE ONE TAP TO LIVE EXPERTS ROCKET Your Next Home “Ajourney of a thousand miles begi
Slide 21: Scaled Growth & Profitability
Scaled Growt Profitability |
Slide 22: Poised to be the leader in the homeownership category
(3) POISED TO BE THE LEADER IN THE HOMEOWNERSHIP CATEGORY We aim to redefine the homebuying experience through Al, and deliver market share growth, scaled revenue growth and profitability. THE ROCKET PORTFOLIO wen Industry- Scalable Revenue Growth Market Share Growth 22 of 38
Slide 23: Proven Leadership & Culture
Proven Le & Culture
Slide 24: Rocket Companies leadership
(3) ROCKET COMPANIES LEADERSHIP VARUN KRISHNA CEO BILL EMERSON Rocket Companies Board Director BRIAN BROWN CEO Rocket Companies CFO & Treasurer Rocket Mortgage President & COO Rocket Companies Board Director Rocket Companies Rocket Companies Le TINA JOHN JONATHAN MILDENHALL KIMARIE YOWELL TIM BIRKME
Slide 25: Culture is our foundation
G) CULTURE IS OUR FOUNDATION ‘@ Obsessed with finding \ better way. @ Innovation is rewarded. Dan Gilbert, our founder and Chairman, purposefully created a strong cultural foundation of core philosophies, or “ISMs,” as a cultural operating system to guide decision-making by all our team members. @ L
Slide 26: Love our team members
(3) LOVE OUR TEAM MEMBERS Our team members put the ISMs into action every day. The result is an empowered and passionate team aligned on a common mission. Great Lafeteo [oy ESSENCE Forbes Work. Forbes REOINE FORTUNE FORTUNE FORTUNE @ @ @ e @ @ @ @ 2015 2018 2019 2021 2020, 2022 2020, 2021, 2022 2023
Slide 27: For more than profit
(3) FOR MORE THAN PROFIT Our company and community are inextricably linked, serving as the foundation for our community investment, team member development and business growth strategies. #1 $200M+ Nation’s largest Contributed To Federal Housing Community Organizations Administration lender And Prog
Slide 28: 2024 All Company Meeting
2024 ALL COMPANY MEETING
Slide 29: Appendix
Appendix
Slide 30: Our companies
(3) OUR COMPANIES HOME FINANCING PERSONAL FINANCE |HOME SEARCH & SALES ROCKET Sinescekdsenicer | ROSKET siirctane | ROSKET | Eonsseushater amrock — Wsteesetlomert | ROCKET irslin LENDESK eos <onese = Rocket Companies consists of personal finance and consumer technology brands including Rocket Mortga
Slide 31: Financial highlights
(3) FINANCIAL HIGHLIGHTS (S in M) 2022 2023 Q4'22 Q3'23 Q4'23 Q1'24E} Adjusted Revenue $4,628 $3,770 $683 $1,002 $885 $925-$1,075 YoY % (63%) (19%): (72%) 13% 30% Q0Q % N/A N/A (23%) 0% (12%): Adjusted EBITDA $59 $67 ($204) $73 $55 % Margin 1% 2% (30%) 7% 6% Adjusted Net (Loss) Income ($137) ($143):
Slide 32: Strong liquidity position
(3) STRONG LIQUIDITY POSITION $9.0B Total liquidity as of December 31, 2023 $3.6B Available cash (cash and discretionary self-funding) $5.4B Availability on lines of credit ($2.1B with parent company) SOURCES OF CASH LIQUIDITY“ $3,350M 12/31/2023 Rocket Total Liquidity Undrawn Lines of Credit @ Undr
Slide 33: MSR portfolio UPB
(3) MSR PORTFOLIO UPB m Total Serviced UPB ($ in B) $507 $467 soa $378 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Note: Servicing UPB remains unchanged following Excess [O sales as Rocket retains the MSR and base servicing fee 33 of 38
Slide 34: Endnotes (1)
(3) ENDNOTES (1) Three Months Ended December 31, Years Ended December 31, nm Le ee & J (Unaudited) (Unaudited) NET (LOSS) INCOME ($233) ($493) ($390) $700 Interest And Amortization Expense On Non-funding Debt 38 38 153 154 Income Tax (Benefit) Provision (10) (13) (13) 42 Depreciation And Amortizatio
Slide 35: Endnotes (1)
ENDNOTES (1) Three Months Ended December 31, Year Ended December 31, nM a ee ‘& ) (Unaudited) (Unaudited) TOTAL REVENUE, NET $694 $481 $3,799 $5,838 Change in fair value of MSRs due to valuation assumptions (net of hedges) (a) 191 202 (29) (1,211) BUSTED REVENUE $885 $683 $3,770 $4,628 (2) Reflects
Slide 36: Endnotes (1)
ENDNOTES (1) G) ($ in M) NET (LOSS) INCOME ATTRIBUTABLE TO ROCKET COMPANIES Net (Loss) Income Impact From Pro Forma Conversion Of Class D Common Shares To Class A Common Shares (a) Adjustment to the Benefit From (Provision For) Income Tax (b) TAX-EFFECTED NET (LOSS) INCOME (B) Share-based Compensati
Slide 37: 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 38: Rocket Companies
©) ROCKET Companies