Roku Inc stock soars after Earnings Report

On 13th February 2020, Roku Inc (ROKU) submitted its fourth-quarter yearly report which exceeds the estimated value predicted by analysts. The report rise above the expected revenue estimated by analysts but was a little below the amount per share predicted by the analyst. In terms of the revenue generated, analysts expected $1.58 billion but the company reported $1.6 billion. This positive change caused an immediate increase in the sales of shares. The increase was about 9% but later reduced to around 5%.

Roku stock was among the 2019 top-performing companies with an increase of almost 337%. However, this wonderful outcome did not continue until the new year. As a result, investors have been anxiously waiting for the release of the fourth-quarter record. Here are some key numbers recorded in the new report 

• Actual loss-share 13% as against the expected 14 percent

• The total amount of revenue recorded $411million as against the expected $392 million.

• The full-year revenue recorded is $1.13 billion as against the expected 1.11 billion.

In the company's letter to current and potential shareholders, it revealed that monetized video ad impressions doubled tremendously in the year. Also in the letter, Roku pointed out that all top 10 telecom and technology advertisers and top 10 consumers packaged good engaged in a business transaction with the company.

The average revenue per user(ARPU) recorded in the report is $23.14 on a 12-months trailing, an increase of 29% or $5.19 year over year. Also, streaming hours increased by 16.3 billion hours year-over-year to 40.3 billion. 

2020 Revenue Guidance

The revenue guidance provided for the new year is $1.6 billion, while the analyst expects the venue to be about $1.58 billion. In a survey carried out by Refinitiv, Roku said in a letter to its shareholders that it hopes to become "roughly break-even on a full-year adjusted EBITDA basis" in 2020. Also with the increase in the due paid every month per head in 2019, Roku expects to get about $905 million in GAAP operating expenses, and also obtain a better and greater facilities costs in its recent headquarters. The company also expects to get operating expenses from its acquisition of Dataxu.

Also in the letter, Roku executives write that "We predict that by 2024 roughly half of all U.S. TV households will have cut the cord or never had a traditipay-TVay TV. While 2019 was a tipping point in commitments to streaming, the full force of change is still to come."