Roku Passes 30 Million Users
Quarterly revenue hit $250 million as the company beat Wall Street expectations.
Roku now has 30.5 million active users, up 39 percent from the same quarter a year ago, and up 1.5 million from last quarter, the company said Wednesday.
In its second quarter earnings report, the technology company reported revenues of $250 million, up 59 percent from a year ago. Net losses in the quarter were $10.4 million. The company beat its own outlook and Wall Street estimates across the board.
Once again Roku's platform revenue, led by its advertising business, was the growth driver, delivering nearly $168 million in revenue, up 86 percent from last year. The company's hardware revenue was $82 million, up 24 percent; gross hardware profits, however, declined by 69 percent year over year as the company focuses on keeping prices low to expand the reach of its platform.
The 30.5 million users streamed 9.4 billion hours of content in the quarter, an improvement of 72 percent from last year, helping drive the improvement in the company's advertising business.
The company said Wednesday that it is increasing its outlook for 2019 in the wake of its quarterly performance, with executives writing in its quarterly report that they are "confident" the company will hit $1 billion in revenue this year, two-thirds of which will be from its platform business.
On a call with analysts, Roku CEO Anthony Wood said that the company’s outlook for the rest of the year does not account for tariffs that may be implemented by the Trump administration.
“In general, tariffs might impact our future results, depending on their exact timing and rates, and other variables,” said the exec, adding that the company is ”taking steps to mitigate any potential impact,” including relocating its manufacturing over time.
In the letter to shareholders, the company touted its data proficiency, as well as its ability to grow its ad business, as key to its success.
"As more and more TV ads are streamed, platforms that know their users well, like Roku, are thriving. This is evidenced by our growing client base. We have worked with three quarters of the Ad Age Top 200 national advertisers," Wood wrote in the letter. "Likewise, programmatic demand, as well as emerging verticals like direct-to-consumer, are among our fastest-growing sales channels."