- Roku shares are up as high as 26% after crushing its first-ever earnings report as a public company.
- Roku credits the growth to its fast-growing platform business, including advertising, which more than doubled from the year-ago period.
Streaming TV box provider Roku beat Wall Street revenue estimates on its first-ever earnings report as a public company, posting revenue of $124.8 million versus analyst consensus of $110 million.
The company also provided revenue guidance for the next quarter that was above expectations, indicating that it expects to generate $175 million to $190 million in revenue in the holiday shopping quarter.
The good news sent shares of Roku spiking as much as 28% in after-hours trading, hovering around $23.75 a share, before giving up some of the gains and trading up 22%.
Roku first went public at the end of September 2017, priced at $14 per share. It immediately saw a huge pop out of the gate, with first-day gains of about 70%. Since then, Roku has experienced some volatility: In its brief time as a public company, Roku shares have gone as low as $15,75, and as high as $29.80.
For this first-ever quarter as a public company, Roku credits much of the growth to its rapidly expanding platform business, rather than its sale of its streaming media hardware. The hardware promotes the growth of its software platform, on which Roku takes a cut of all transactions.
In a letter to shareholders, Roku says that its advertising business more than doubled from the same period last year, while its business in providing Roku software to smart TV manufacturers continues to grow.
Ultimately, Roku says that it’s now on track to do $500 million in revenue in 2017, up from $400 million in 2016.