Shares of Roku (NASDAQ:ROKU) started today's session down 4.5%, but some company-specific news reversed the decline, moving the stock up 3.5% as of 1:45 p.m. EST.
Other technology stocks are dropping today as investors rotate away from the big winners of 2020, and that's how Roku also began trading. After it released preliminary fourth-quarter data, however, shares reversed direction. The company said it surpassed the 50 million account milestone.
Specifically, Roku announced that as of Dec. 31, 2020, the company had 51.2 million active accounts. That's up from 46 million at the end of the third quarter and up 38% compared to the end of 2019. The company also said that streaming hours increased 55% versus the prior-year period.
Roku shares had already been volatile this week after it was reported the company was in talks to acquire the short-form video catalogue from the recently shuttered Quibi platform.
Roku shares initially dropped on that news as investors feared a strategy shift into content creation would be overwhelmingly costly. But the company has not said it intends to become a generator of new content for its Roku Channel.
The 38% growth in active accounts in 2020 slightly exceeds that of 2019's 36%. The company didn't reveal its earnings details in the preliminary release, but gross profit has typically exceeded active account growth. Gross profit spiked in the third quarter of 2020, and investors should keep a lookout for that as well as revenue growth when Roku reports its finalized fourth-quarter results in the coming weeks.