Is Roku Finally Slowing Down?

By Chris Lange Updated Jan 11, 11:51PM EST · Published May 9, 4:26PM EDT

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Is Roku Finally Slowing Down? — © Thinkstock

Roku Inc. (NASDAQ: ROKU) released its first-quarter earnings report after markets closed Wednesday. The company posted a net loss of $0.07 per share on $136.6 million in revenue. Thomson Reuters consensus estimates had called for a net loss of $0.15 per share and $127.15 million in revenue. The same period from last year had a net loss of $0.09 per share on $100.1 million in revenue.

During the quarter, platform revenue increased 106% year over year to $75.1 million. However player revenue fell 3% to $61.5 million.

Active accounts increased by 47% to 20.8 million, while streaming hours increased 56% to 5.1 billion hours. Overall this yielded an average revenue per user of $15.07 for the quarter, which was an increase of 50% year over year.

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In terms of the outlook for the second quarter, Roku expects to see a net loss in the range of $19 million to $14 million and total net revenues in the range of $135 million to $145 million. There are consensus estimates calling for $0.16 in EPS on $135.29 million in revenue for the coming quarter.

Anthony Wood, founder & CEO, commented:

We saw strong momentum across our key operating metrics. Roku ended Q1 2018, with 20.8 million active accounts, up 47% year-over-year. Half of the new accounts in the quarter came from licensed sources, primarily Roku TVs. Roku users streamed 5.1 billion hours in the quarter, up 56% year-over-year, with the fastest growth coming from ad-supported content. Trailing 12-month ARPU in the first quarter increased 50% year-over-year to a record $15.07, the fastest ARPU growth rate in over 18 months as we continue to expand platform monetization and capture a larger share of TV ad budgets. We believe there is a long runway for upside to ARPU from content distribution, audience development and advertising growth, as consumers spend time streaming more ad-supported content, and as Roku gains access to a greater share of overall ad impressions.

Shares of Roku closed Wednesday up about 9% at $36.08, with a consensus analyst price target of $36.57 and a 52-week range of $15.75 to $58.80. Following the announcement, the stock was initially up 2.5% at $37.00 in the after-hours session.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.