Roku Stock Leaps 47 Percent on Massive Jump in Streaming Hours, New Customers
Roku just sent another clear signal the streaming revolution is here to stay.
The company’s stock, which specializes in streaming hardware, has rocketed up 47 percent in early morning trading on Thursday, after posting sales that easily surpassed Wall Street expectations for its first quarter as a publicly traded company.
Roku hauled in $124.8 million in revenue — about $14 million more than anticipated — and posted an adjusted loss of 10 cents per share, easily besting the $1.37 per share loss analysts had forecast.
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“Our higher margin platform segment is the key driver of our growth and gross margin expansion, and our advertising business has more than doubled in size year-to-date,” said CEO Anthony Wood in a statement on Wednesday.
The family of Roku streaming devices run from about $30 to $130, and have become increasingly popular as content giants like Netflix have gained steam in recent years.
Two numbers stood out in particular for Roku: a 48 percent year-over-year increase in active accounts, along with a nearly 60 percent jump in hours spent streaming. With Roku boasting about 50 percent of the streaming device market when it went public in September, its third quarter performance shows the company hasn’t slowed down in bringing more users into the fold.
Roku also saw substantial growth from its ad business, which Chief Financial Officer Steve Louden had mentioned to TheWrap as an area the company was well positioned to take advantage of.
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“We’re founded on the belief that all TV will be streamed,” said Louden. “In the U.S. alone there’s $70 billion alone in traditional TV advertising that’ll increasingly come to streaming. And we’ve positioned ourselves as a leader in the over-the-top advertising space.”
The Los Gatos, CA.-based company said it could break even in Q4.
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Source: The Wrap