Roku Inc. benefited from improved ad spend in the fourth quarter and also delivered a surprising profit for the period.
The company posted a fourth-quarter profit of $ 67.3 million, or 49 cents a share, on Thursday, versus a loss of $ 15.7 million, or 13 cents a share, a year earlier. Analysts polled by FactSet expected a loss of 5 cents a share.
YEAR OF THE YEAR,
reported adjusted earnings before interest, tax, depreciation and amortization (Ebitda) of $ 113.5 million, up from $ 15.1 million a year before and prior to the FactSet consensus, which raised $ 43 million.
Shares rose 2.8% on Thursday during out-of-hours trading.
Fourth quarter revenue increased from $ 411 million to $ 649.9 million, while analysts asked for $ 619 million. The company generated $ 178.7 million in revenues from its player activities and $ 471.2 million in revenues from its platform activities, including licensing and advertising.
“Despite a pandemic-related advertising slowdown in the US, our advertising business proved resilient as Roku more than doubled its video ad impression revenues year over year in the fourth quarter as advertisers increasingly followed users from traditional pay-TV to streaming,” the company said. his letter to shareholders.
Roku noted in the letter that the six largest agency holdings more than doubled their investment with Roku during the fourth quarter from a year earlier, “while also committing to a significantly greater 2021 outlook with Roku.”
Roku’s average revenue per user was $ 28.76, compared to $ 23.14 a year earlier.
The company disclosed 51.2 million active accounts as of the fourth quarter, after adding 5.2 million net accounts on a sequential basis. Roku users streamed 17 billion hours of content during the quarter.
Roku revealed that The Roku Channel, which gathers ad-supported content on the platform, more than doubled its reach in the fourth quarter, with usage growing almost twice as fast as the overall Roku platform.
The company announced earlier this year that it would purchase a catalog of original programming from Quibi, which Roku planned to present on The Roku Channel. Chief Financial Officer Steve Louden said in a media call with reporters in response to Roku’s earnings report that as the scale of the platform grows, the company will “continue to look at different ways to embed content” in a way that suits the ad-supported video-on-demand model.
“We just have more options now that we’re bigger,” he continued.
For the first quarter, Roku expects sales of $ 478 million to $ 493 million. The company anticipates a net loss of $ 16 million to $ 23 million. Analysts predicted $ 463 million in revenue and a net loss of $ 52 million.
Looking at the full year, Roku declined to make a quantitative forecast, but told investors in its shareholder letter that it expects stronger comparisons in the first half of the year, given the impact of COVID-19 early last year, and harder comparisons in the second half of the year.
“So for the full year, our overall year-over-year sales growth will fall below the level we expect to see in the first and second quarters of 2021,” Roku said in the letter.
Shares of Roku are up 95% in the last three months as the S&P 500 SPX,
is up 9.7%.