Thursday morning brought further gains for the stock market, as market participants ignored news of troublingly high first-time unemployment claims in hopes of further stimulus measures from Washington and the Federal Reserve. Just before 11 a.m. EDT today, the Dow Jones Industrial Average (DJINDICES:^DJI) was up 24 points to 27,225. The S&P 500 (SNPINDEX:^GSPC) was up less than a point at 3,328, and the Nasdaq Composite (NASDAQINDEX:^IXIC) gained 2 points to 11,001.

Earnings season has gone quite well in most respects, with several big-name companies enjoying stellar results. But expectations have been high, and some companies haven't been able to live up to their hype. Fastly (NYSE:FSLY) was a victim of its own success Thursday morning, as it wasn't able to satisfy growth-hungry investors despite solid results. Similarly, Roku (NASDAQ:ROKU) also gave up ground as investors mulled whether the growth trajectories from these cutting-edge companies are sustainable well into the future.

Two bags on a see-saw, one marked risk, the other reward.

Image source: Getty Images.

Fastly falls off the edge

Shares of edge-computing specialist Fastly were down more than 20% Thursday morning. The cloud platform provider continued to grow at an impressive pace during the second quarter of 2020, but after a huge run-up in the stock, shares were ready for a break.

Fastly's numbers would make most investors turn green with envy. Revenue jumped 62% from year-ago levels, and the company signed up 114 new customers during the quarter to bring its client count to 1,951. A dollar-based net expansion rate of 137% was up 4 percentage points from three months ago, and it signaled continuing loyalty among Fastly's users.

Some investors weren't pleased, though, with the announcement that TikTok owner ByteDance was Fastly's largest customer during the quarter. With plenty of controversy surrounding the Chinese short-video app provider, Fastly admitted that a ban of the service in the U.S. could have a material impact on its business.

It's hard to feel too bad for Fastly shareholders, though, as the stock price is still six times higher than it was at the March lows. After such an impressive run, Fastly's shares might simply be consolidating before its fundamental business strength reasserts itself.

Roku runs lower

Elsewhere, Roku saw a 7% drop in its stock price Thursday morning. The streaming video provider saw a lot of viewership in the second quarter, but some concerns about advertising weighed on sentiment.

Roku's revenue rose 42% in the quarter compared with year-earlier figures, as the service added 3.2 million active accounts during the past three months to bring its total count to 43 million. Hours of content streamed soared to 14.6 billion, up by 2.3 billion hours from first-quarter figures. Roku squeezed more sales from its subscribers, with average revenue per user up 18% year over year to $24.92.

Roku has successfully ridden the coattails of other content providers to enhance its own prospects. The company said that its connected device was the most frequently used by subscribers to Disney's (NYSE:DIS) Disney+ streaming service, citing its importance in the success of the video release of the blockbuster Broadway musical Hamilton. Content partners have increased their investment in Roku, benefiting both themselves and the platform provider.

Advertising has been in decline, and although Roku cited numerous examples of how it's outpacing the broader industry, investors seemed unconvinced that the company will escape the negative impact entirely. Nevertheless, as more people move toward streaming television, Roku has put itself in position to benefit for the foreseeable future, making it a solid growth stock prospect.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.