Streaming device company’s share price slides 14% on Wednesday afternoon
On paper, Roku did everything right when it posted its Q3 financials on Wednesday afternoon. The company added nearly 2 million active accounts — and reached 10 billion hours of content being streamed on its devices — while topping Wall Street’s sales projections. Roku also reported a smaller loss than anticipated, yet its stock was hammered 14% in after-hours trading after the company shared modest fourth quarter guidance.
Roku increased revenue more than 50% year-over-year, with sales of $261 million narrowly surpassing analyst estimates of $257 million. The company, best known for making several streaming players, saw a slight dip in device sales from the previous quarter, but did increase sales 11% overall compared to the same time last year. Most of Roku’s Q3 sales stemmed from its growing advertising business, however, which accounted for nearly $180 million in revenue. Roku also posted a loss of 22 cents per share, compared to the 24 cents analysts expected it to lose per share.