Key financial results
- Adjusted revenue for the third quarter of 2026 was $2.6 billion, near the midpoint of guidance.
Adjusted revenue of $2.6 billion near the midpoint of our guidance
- Adjusted EBITDA reached $748 million with a 29% margin, marking the highest margin in nearly 5 years and the fourth straight quarter of expansion.
Adjusted EBITDA of $748 million with margins expanding to 29%.
- Adjusted net income was $419 million, resulting in $0.15 of adjusted diluted earnings per share.
Adjusted net income of $419 million, $0.15 of adjusted EPS.
- GAAP total revenue was $3.3 billion, and GAAP net income was $709 million or $0.25 per diluted share.
On a GAAP basis, total revenue was $3.3 billion and net income was $709 million or $0.25 per diluted share.
- Net rate lock volume was $40.4 billion and closed loan volume was $43.6 billion.
We generated $40.4 billion in net rate lock volume and $43.6 billion in closed loan volume.
- Total expenses were $2.3 billion, down $175 million from the second quarter, driven by synergies and variable costs.
Total expenses were $2.3 billion, down $175 million from the second quarter.
Business segment results
- Purchase: Purchase market share approached 6.5%, up from 6.2% reported in the second quarter.
purchase market share approach 6.5% and refinance market share was 15.5%.
- Refinance: Refinance market share reached 15.5%, up from 14.3% in the prior quarter.
purchase market share approach 6.5% and refinance market share was 15.5%.
- Gain on sale: Gain on sale margin, excluding correspondent, rose to 333 basis points from 311 basis points in the second quarter.
Gain on sale margin excluding correspondent, was 333 basis points up from 311 basis points last quarter.
- Direct-to-consumer: Direct-to-consumer gain on sale margins increased to 431 basis points from 413 basis points in the second quarter, helped by higher home equity volume.
direct-to-consumer margins, which rose to 431 basis points from 413 basis points in the second quarter.
- Servicing: Servicing generated $1 billion of fee income for the third quarter from an unpaid principal balance of $2 trillion across 9.1 million clients.
Servicing generated $1 billion of fee income for the third quarter.
- Servicing: Fair market value of MSRs, net of hedges, increased to $710 million in the quarter.
fair market value of our MSRs, net of hedges, increased to $710 million in the quarter.
- Rocket Local: Rocket Local grew loan volume by more than 30% year-over-year and expanded its team to more than 400 loan officers.
Rocket Local grew volume more than 30% year-over-year and we've built the team to more than 400 loan officers
- Partnerships: Redfin and Compass agents represented 1 in 5 purchase clients, and visitors clicking through from Redfin to start a purchase mortgage rose 50% year-over-year.
1 in 5 of our purchase clients is represented by our Redfin or Compass agent.
- Rocket Pro: Rocket Pro net rate lock volume through Compass passed $3 billion since February, up 50% from last quarter.
Rocket Pro net rate lock volume through Compass has passed $3 billion since February
- Recapture: Recapture on the legacy Cooper portfolio reached 60%, approaching the 65% target.
hit 60% on the legacy Cooper portfolio.
Capital allocation
- Liquidity ended at a record $11.4 billion, which includes $2.7 billion of cash.
We ended the quarter with a record $11.4 billion of liquidity, including $2.7 billion of cash.
- Net corporate leverage remained below 1x, and the company maintains an investment-grade rating.
Net corporate leverage is below 1x and we're the only independent mortgage company with an investment-grade rating.
- Management did not discuss dividends or share repurchases on the call.
Industry trends and dynamics
- The 10-year Treasury rose 80 basis points to 5.3%, and the 30-year mortgage rate rose over 80 basis points to 7.3%.
the 10-year treasury rose 80 basis points to 5.3%, the highest in 24 years. The 30-year mortgage rate rose more than 80 basis points to 7.3%.
- Existing home sales fell below 4 million on an annualized basis, and refinance applications fell more than 50% from a year ago.
existing home sales fell below 4 million. Refinance applications fell more than 50% from a year ago.
- The MBA mortgage application index fell in 10 of the 13 weeks during the quarter, dropping 23% from the second quarter average.
The MBA's mortgage application index fell in 10 of the 13 weeks during the quarter. Applications were down 23% from the second quarter average.
Competitive landscape
- Management stated that difficult markets expose flaws in competitor business models while highlighting Rocket's scale and integrated ecosystem.
tough markets don't lie. They reveal what's real.
- Unlike competitors who rent technology or lack full servicing and origination capabilities, Rocket controls its technology stack end-to-end.
Most lenders rent their technology. We have built ours across origination and servicing
- Management noted that other lenders are no longer able to use pricing as aggressively to drive volume due to balance sheet pressures.
when rates have risen, and we've seen lenders out there maybe try to use pricing as a lever to still drive volume, you're not seeing that as much anymore.
Macroeconomic environment
- Mortgage rates reached highs not seen in two decades, creating a punishing environment for American families trying to buy homes.
For American families trying to buy a home, the math went from hard to punishing.
- There is a record $12 trillion in tappable home equity in the United States.
There is a record $12 trillion in tappable home equity in this country
Growth opportunities and strategies
- On nearly 20% of direct-to-consumer volume, AI completed credit pulls before the client spoke to a loan officer.
On nearly 20% of our direct-to-consumer volume, AI completed that step before the client ever spoke to a loan officer.
- Digital refinances represented over 40% of all direct-to-consumer refinance applications in the third quarter, converting at 4x other channels.
digital was more than 40% of all direct-to-consumer refinance applications and digital leads converted at 4x the rate of every other channel.
- AI voice agents handle 65% of inbound servicing calls and resolve over half of them independently.
The platform handles 65% of inbound servicing calls and resolves more than half of them on its own.
- Rocket has integrated with AI shopping agents like Meta's Muse via APIs to allow end-to-end mortgage completion.
built the APIs and protocols, those agents need to complete the mortgage process with Rocket end to end.
Financial guidance and outlook
- For the fourth quarter of 2026, adjusted revenue is expected to be between $2.1 billion and $2.3 billion.
we expect adjusted revenue to be between $2.1 billion and $2.3 billion.
- Total expenses for the fourth quarter are expected to be $2.50 billion at the midpoint of revenue, including $110 million of intangible amortization, $80 million of stock-based compensation, and $10 million of onetime integration costs.
we expect total expenses of $2.50 billion, including $110 million of intangible amortization, $80 million of stock-based compensation and $10 million of onetime integration costs.
- Excluding specific non-operating items, fourth-quarter expenses are expected to be $1.850 billion, down $165 million from the third quarter.
Excluding these items, we expect expenses of $1.850 billion a decline of $165 million from the third quarter.
- The refinance market is projected to decline by almost half from the third quarter, bringing overall origination activity near multi-decade lows.
we expect the refinance market to decline by almost half from the third quarter which would leave the overall mortgage activity near multi-decade lows.
Synergies and cost structure
- The company realized $300 million of Mr. Cooper expense synergies through the third quarter and expects the remaining $100 million of annualized savings in the fourth quarter.
Through the quarter, we have realized $300 million in Mr. Cooper expense synergies. We expect to deliver the remaining $100 million of annualized savings in the fourth quarter
- Management expects an additional $100 million in annual cost savings to be realized in the first half of 2027.
we have line of sight into an additional $100 million in annual savings, which we expect to realize in the first half of 2027.
- Rocket has built over $300 billion of origination capacity without adding fixed costs.
We've built more than $300 billion of origination capacity without needing to add fixed costs.
Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Adjusted revenue | $2.6 billion | Near midpoint of guidance |
| Adjusted EBITDA | $748 million | 29% margin, up from 28% last quarter |
| Adjusted net income | $419 million | Not stated |
| Adjusted diluted EPS | $0.15 per share | Not stated |
| GAAP revenue | $3.3 billion | Not stated |
| GAAP net income | $709 million | $0.25 per diluted share |
How management sounded
Balanced (+35 on our -100 to +100 scale). Management emphasized market share gains and structural cost advantages despite severe industry headwinds and multi-decade high interest rates. Management sounded more upbeat than on 9% of the 194 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Read the analyst Q&A summary and guidance and outlook for this call.
What to watch before the next call
- The trajectory of 30-year mortgage rates and the 10-year treasury following their recent peaks.
- Realization of the additional $100 million in structural cost savings slated for the first half of 2027.
- Performance of the home equity and cash-out refinance pipelines amid declining industry-wide refinance volumes.
Earlier calls
- Q2 2026 (Aug 6, 2026), tone Balanced: Rocket Companies delivered its most profitable quarter in four years and record market share despite a tough spring housing market.
