Both platform and player revenue fell from Q2. This is not good for Roku, which relies on this source of revenue. That is strong.īut the current economic state is still causing advertisers to pause and reconsider spending. Active accounts were positive in Q2, as they added 2.3 million incremental active accounts to reach 65.4 million rising from 63.1 million last quarter and up from 56.4 million a year ago. This quarter was strong, but the outlook is horrific. and is the number one TV streaming platform in the U.S., Canada, and Mexico by hours streamed, but the Street wants growth, a path to earnings, and strong outlooks. It is great that Roku is the top selling TV operating system in the U.S. Subscriber growth is critical for Roku, followed by expenses to attract accounts. Trends in new accounts and advertising revenue Just horrible, even though it was better than we expected. While revenue did grow 18.5% from last year, the bottom line is that this is such a slow pace of growth, it is hard to defend the bullish thesis. This is a money-losing company, so big revenue beats are welcomed. But gross profit fell 2% to $457 million. Revenues were up 12% from last year to $761 million. The company also reported earnings that were decent, all things considered, on the back of these revenues but expenses that were a bit higher than we would like to see. The company beat revenue estimates by a rather large degree. The subscriber numbers, player data, and other key trends are very telling. Our take is that you need to avoid Roku stock, though long-term investors could speculate, but we think there are many better places to put your money. This follows a day where the markets cratered on yet another hike from the Fed and commentary from Chairman Powell that were as hawkish we can remember. Really terrible outlook for Q4, and that is why the stock is completely tanking. We received an ask to discuss these earnings and figured it was time to put something out on these earnings.īottom line? Roku's quarter was fine, but the guidance was grim. So what is going on here? Shares are crashing more than 20% after hours. It was quite good indeed, all things considered. Now, we want to say that the company just reported a really strong Q3. The losses are absolutely staggering over the last year. ( NASDAQ: ROKU) stock has been a very tough stock for longs.
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