Roku CEO Anthony Wood speaks on stage at The Future of TV Streaming & Entertainment during the Tribeca X – 2021 Tribeca Festival at Spring Studios on June 18, 2021 in New York City.
Arturo Holmes | Getty Images
Roku stock fell more than 8% in after-hours trading Wednesday after reporting second-quarter earnings that exceeded expectations but showed a slowdown in streaming TV viewing since last quarter and tight hardware margins .
Here’s how the company fared compared to Refinitiv’s consensus estimates:
- EPS: $ 0.52 per share versus an estimate of $ 0.13 per share
- Revenue: $ 645 million versus an estimate of $ 618 million
The company said streaming hours were down 1 billion hours from the first quarter of 2021 and stood at 17.4 billion hours in the second quarter. The company cited consumers looking for more out-of-home entertainment activities like dining and travel in the second quarter due to the backlog and the easing of Covid-19 restrictions. But Roku’s streaming hours were still up 19% year-over-year, the company said.
In his letter to shareholders it was also stated that “tight delivery conditions for components and shipping restrictions” caused costs to continue to rise faster than expected.
“In the second quarter, we protected consumers from increased Roku player costs, which resulted in player gross margins going negative for the quarter,” the letter said.
The company’s total net sales increased 81% quarter-over-quarter to $ 645 million. Platform revenue for the quarter topped half a billion US dollars for the first time in the segment’s history, reaching US $ 532 million, driven by content and advertising diffusion.
Roku also commented on the advertising plans, in which advertisers spend part of their annual budget on TV advertising. The company said it made double the money it made last year, and that 42% of all advertisers who signed up to Roku in advance didn’t participate last year.
This is evolving.
