Prime Highlights
- Roku shares jumped 8% after the company delivered stronger-than-expected fourth-quarter earnings and issued upbeat full-year revenue guidance.
- The company reported its “biggest ever” quarter for premium subscription net additions, driven by growth in bundled streaming services.
Key Facts
- Roku posted earnings of 53 cents per share on revenue of $1.39 billion, beating analyst estimates of 28 cents per share and $1.16 billion in revenue.
- The company swung to a net profit of $80.5 million from a $35.5 million loss a year earlier, and forecast full-year revenue of $5.5 billion, above expectations of $5.34 billion.
Background
Roku shares climbed 8% on Friday after the streaming platform posted stronger-than-expected fourth-quarter results and issued upbeat guidance for the year ahead. The company beat analyst estimates on both profit and revenue, driven by rapid growth in its premium subscription business.
Roku reported earnings of 53 cents per share, well above expectations of 28 cents. Revenue rose 18% year-on-year to $1.39 billion, compared with $1.03 billion in the same period last year. The company swung to a net profit of $80.5 million from a loss of $35.5 million a year earlier.
Executives described the quarter as the “biggest ever” for net additions to premium subscriptions. The service allows users to subscribe to platforms such as HBO Max and Paramount+ through a single Roku login. CEO Anthony Wood said the shift toward bundled subscription services continues to drive growth.
For the current quarter, Roku expects revenue of $1.2 billion, higher than analyst forecasts of $1.16 billion. It also projected full-year revenue of $5.5 billion, beating expectations of $5.34 billion.
The company plans to introduce subscription bundles later this year. It recently acquired Frndly TV for $185 million and launched a new ad-free service called Howdy priced at $2.99 per month.
Analysts at Rosenblatt Securities upgraded the stock, citing strong results and future growth opportunities, including advertising partnerships with Amazon.
