Shares of Roku saw its shares surge on Thursday after reporting earnings that crushed what analysts had been expecting from the streaming technology company.
The stock popped over 50% on Thursday after posting a narrower loss than Wall Street expected. This is the first earnings report for the company that just went public this past September in an IPO valued at $252 million.
Roku reported adjusted EPS of a loss of 10 cents. This was a lot better than the loss of $1.37 that Wall Street was waiting for.
Revenues at $124.8 million was also higher than the $110.5 million that analysts expected.
“Our business really is about building active accounts,” CEO Anthony Wood said on Thursday on “Squawk on the Street.”
“For us, selling players is just a great way to build up active accounts and we optimize that business around volume of players,” he continued.
“We are the leading OTT distribution company in the U.S. and so those companies naturally come to Roku for distribution of their content, and we’re just a great partner for them,” Wood said. “Those companies, as they shift to OTT, that is what’s driving our business.”
“Everyone over time is going to shift to streaming, and I think importantly, the entire ad business — television ad business, which today is still predominantly on traditional linear TV — is moving to streaming as they follow their viewers to streaming,” Wood remarked.
Looking ahead, Roku has forecast that it may break even in the next quarter.
I encountered [any] customers,” he says. “They just don’t come in as often as they used to.”
Disclaimer: We have no position in Roku Inc. (NASDAQ: ROKU) and have not been compensated for this article.