In a spate of less-than-stellar Q3 revenue reports, Roku almost joins the pack, yet a peak in other key metrics has kept the Stock Market interested despite this low-key result. Just last week we saw the over-the-top streaming device giant announce a quarterly revenue that falls just short of Wall Street expectations- $3M less on $680M, in fact. We ask Brandon Blake of Blake & Wang P.A for his analysis of what worked and didn’t for Roku this quarter.
Despite this momentary disappointment, and the accompanying Stock Market dip, results overall were good for Roku. We see earnings per share of 48c, a vast improvement on the predicted 6c. We also see subscriber growth of about 1.3M in the quarter, bringing them to 56.4M active accounts.
Nor is that the only good news. We also see an 82% jump in platform revenue, bringing it to $582.5M. Perhaps even more encouragingly, this is generated through a rise in average revenue per user of about 49%, and a 21% streaming hour increase. It’s easy to see why the blip on the share price quickly stabilized, returning to baseline by the end of the day.
All was not rosy with the announcement, however. Alongside Q3 results, we saw Roku announce a negative impact from supply chain issues, and a warning to shareholders that this could continue through the key holiday period. They speculate that this could affect ‘consumer confidence, product pricing and availability, and advertising spend levels’ well into 2022, in fact.
Fourth Quarter benchmarks are currently set at a total gross profit of $385M ( a 26% year-on-year rise), revenue just short of $900M at the midpoint (37% year-on-year), with growing streaming revenue and confidence. Will they meet their targets? Our expert entertainment attorney will report back on further developments.
