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Roku users are streaming more video programming during the shutdown.
The company, which makes set-top boxes and connected TVs, saw “an acceleration of growth” in both new accounts and streaming hours during the first quarter of the year.
Active accounts grew by 38 percent to 39.8 million since the same period last year, and streaming hours rose by 80 percent year-over-year to 13.2 billion. “The pandemic associated stay-at-home orders and increased unemployment appear to have accelerated the shift from linear TV viewing to streaming during the past few weeks,” the company wrote Thursday in its first-quarter shareholder letter.
Despite the streaming growth, Roku has seen higher than normal advertising cancellations due to the industrywide pullback in ad budgets. Even so, the company, which withdrew its 2020 outlook, is forecasting that it will deliver year-over-year revenue growth for the year due in part to ad spend moving from traditional TV budgets. It is expecting a slower growth rate, however, and lower gross profit than originally expected.
In response to the pandemic, Roku says it has taken steps to slow the rate of growth for its operating expenses ad capital expenditures. But, the company noted, “[o]ver the longer term, not only do we believe that the trends that we expect to define the streaming decade will remain intact, but changes brought on by the COVID-19 pandemic may even accelerate Roku’s path to greater platform scale.”
All told, Roku grew revenue by 55 percent to $321 million, with platform revenue up by 73 percent. It had a net loss of 45 cents per share. Its stock was down 7 percent during after-hours trading on the Nasdaq.
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