Roku reported 20% growth in Q3, bringing in $912 million in revenue, topping expectations of $847 million. The streaming company also added 2.3 million subscribers for a total of 75.8 million active accounts globally, up 16% year-over-year, driven by an increase in smart TV sales, the company said.
“We drove strong engagement with streaming hours surpassing 100 billion for the first time on a trailing 12-month basis, and the Roku Channel remains a top 10 streaming app with engagement comparable to Paramount Plus, Peacock and Max according to Nielsen,” said CEO Anthony Wood.
During the quarter, Roku introduced video ads in the Spotify app on Roku devices and also launched the first NFL League-branded Zone in the Roku sports experience. In September the company announced layoffs and reduction in office facilities and the removal of select content.
The company reported player unit sales remained above pre-COVID levels and that the average Roku player selling price was up 2% year-over-year. Roku users streamed 26.7 billion hours in the quarter, an increase of 22%.
Although the company reported a net loss of $330 million from its newly launched smart TV division, Q3 devices revenue increased 33% year-over-year. Looking to Q4, the company said it anticipates total net revenue of $955 million, up 10% year-over-year. However it also warned of rough seas ahead.
“We remain cautious amid an uncertain macro environment and an uneven ad market recovery,” Wood said. “Ad verticals like CPG and health and wellness continue to improve, while verticals like financial services and M&E remain challenged.
“Additionally, we will face difficult year-over-year growth rate comparisons in content distribution and M&E, which will challenge the year-over-year growth rate of platform revenue in Q4," Wood added. "Within Devices segment, we expect device margins to be down sequentially, in line with historical seasonal trends but up year-over-year.”
