Roku shares slump 15% on widening loss
Roku Inc. shares were creamed 15% in after-hours trading Wednesday after it reported a third-quarter loss nearly triple that of a year ago.
Roku ROKU, +1.06%, a maker of video-streaming hardware, reported an adjusted loss of $26.5 million, or 22 cents a share, compared with a loss of $9.5 million, or 9 cents a share, in the year-ago period.
Revenue did jump 50% to $260.9 million, from $173.4 million a year ago. And the company reported 32.3 million active accounts, a net addition of 1.7 million from the previous quarter. Roku also reported a 30% year-over-year hike in average revenue per user, at $22.58. Both figures beat the estimates of Wall Street analysts.
Analysts polled by FactSet had expected Roku to report a GAAP loss of 28 cents a share on sales of $257 million.
See also: Roku remains a promising stock even after this year’s surge
Separately, Roku on Wednesday announced its intention acquire ad-tech company Dataxu for $150 million.
Roku makes streaming dongles and owns a streaming platform and channel. It went public in 2017 and its stock has been one of the hottest of the year, up 360% in 2019. That compares with gains around 23% and 18% for the S&P 500 index SPX, +0.07% and the Dow Jones Industrial DJIA, +0.00% , respectively, in the same period.
The company was under some strain, however, from increased competition, including Apple Inc.’s AAPL, +0.04% recently launched Apple TV+. Roku also faces fierce competition from Amazon.com Inc.’s AMZN, -0.33% Fire TV and Alphabet Inc.’s GOOGL, -0.03%GOOG, -0.02% Google’s Chromecast.
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