Roku made a smashing debut on Wall Street on Thursday, with the streaming mainstay darting up more than 60 percent in its first day of trading.
The company — which specializes in streaming hardware and competes with tech heavyweights like Apple and Amazon — priced its 18 million shares at $14 a piece. Listed under the convenient ROKU trading symbol on Nasdaq, shares opened at $15.78 and shot north of $21.00 by midday trading.
“We’re very excited, it’s a milestone day for us and another great day of validation for streaming overall,” CFO Steve Louden told TheWrap. “The tailwinds related to streaming are increasingly apparent to folks. Just last week Hulu won the best Emmy for Drama for a streaming TV show for the first time ever.”
With nearly 50 percent of the streaming device market share, Roku is in position to monetize its popularity. Beyond hardware sales, Louden pointed to revenue shares from subscription services and capitalizing on advertisers turning to streaming.
“We’re founded on the belief that all TV will be streamed,” said Louden. “In the U.S. alone there’s $70 billion alone in traditional TV advertising that’ll increasingly come to streaming. And we’ve positioned ourselves as a leader in the over-the-top advertising space.”
Despite operating in a competitive space, Roku has shown its affordable hardware can hold its own against Apple TV and Amazon Fire. Its high end product, Roku Ultra, can run about $130, although many streamers opt for its $30 Roku Express device. Roku has 5,000 streaming channels in the US and more than 3,000 internationally. Netflix is Roku’s most popular source of content, making up one-third of all Roku streaming.
The Los Gatos, Calif.-based company filed for its initial public offering on the first day of September, boasting it had more than 15 million active users that watched three hours of content each day on average. Roku posted a net loss of $42.8 million in 2016, but reported $398.6 million in revenue — a 25 percent bump from 2015.
Morgan Stanley and Citigroup spearheaded the IPO.
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