Rocket Companies Says Profits For Rocket Mortgage Plunged In Second Quarter. CEO Threatens Layoffs If Things Don’t Improve
Rocket Companies, the Rocket Mortgage say the mortgage company’s profits plunged in the second quarter. They claim this is due to rising interest rates and inflation. Therefore, this is dampening consumer confidence and concerns over a possible recession.
The company reported net income of $60 million on revenue of $1.4 Billion. This is down 94% from a year ago. That’s down 94% from the second quarter of 2021.
Rocket Mortgage closed loan origination volume of $34.5 billion in the second quarter. This is also down nearly 60% from the same period last year. The company’s gain on sale margin was 2.92%, up from 2.78%.
The Federal Reserve has been hiking its benchmark interest rate in a bid to curb inflation. The central bank last week announced a rate hike of 0.75%, its second consecutive monthly increase.
CEO Jay Farner told the Detroit News:
Executives tried to assure investors that Rocket is well-positioned for the long run. However, Farmer stated:
Rocket’s stock is also down roughly 30% year-to-date.
