There's a lot more drama than usual when it comes to Roku (ROKU 5.41%) these days. The streaming pioneer reports quarterly results after Thursday's market close, but there will be plenty of fireworks beyond the fresh financials. 

Roku is starting to make a push for proprietary content. It finds itself in a unique and potentially lose-lose dispute with Alphabet's (GOOG 1.25%) (GOOGL 1.27%) YouTube TV. The opportunities and distractions are everywhere, and then we get to the high-stakes nature of the telltale first-quarter report. Roku stock has a lot to prove this week.

Two women watching something scary on TV. Don't worry. They have popcorn.

Image source: Getty Images.

Beyond the numbers

Roku's guidance in mid-February calls for another period of growth. Its outlook at the time for the first three months of this year was $478 million to $493 million in net revenue, a sharp sequential dip from the record $649.9 million it rang up in the fourth quarter -- but there's no reason to panic.

The holidays see a spike in hardware sale as gifts. Even the steadier platform revenue also takes a sequential breather in the first quarter, as advertiser budgets scale back after the holiday push to get noticed. On a year-over-year basis, Roku's guidance translates to healthy 49% to 53% top-line growth. This is in line with the 51.4% three-year annualized revenue growth rate at Roku. 

Roku is forecasting a small deficit for the quarter that it will unveil shortly after Thursday's close. It does see positive adjusted EBITDA of $27 million to $34 million, reversing a $16.3 million deficit during the same period a year earlier. 

Coming in slightly ahead or behind its earlier forecast and market expectations will play a big part in dictating which way the stock moves on Friday, but guidance will have the larger starring role. Investors will also want to see how the fisticuffs between Roku and Alphabet are playing out. Roku removed the YouTube TV app from its platform late last week, arguing that Alphabet's practices are unacceptable. Alphabet's Google pointed the finger the other way, blaming Roku for the falling out. This move affects only Roku's YouTube TV users, not its YouTube users, and for now those with the app can continue to access the live TV service. They just can't get back in if they decide to download the application.

The standoff is dangerous for both parties. Roku has negotiated in public before, including last year, when HBO Max and Peacock launched without agreeing to Roku's revenue-sharing arrangements. The heated negotiations kept both media stocks off the platform initially, but this standoff seems like a bigger deal because it's the removal of an app that was previously available on the Roku marketplace. 

Offsetting the sting will be any potential new developments in Roku's push for content. Now that Roku has more than 50 million users on its platform, it can make cost-effective investments in purchasing or licensing content that it can offer up in a free ad-supported format. Proprietary content should help keep remote-control jockeys loyal to the Roku operating system that now comes standard in 38% of the country's smart TVs. 

Roku stock is trading 31% below the all-time highs it hit less than three months ago, and that's not a bad thing if we draw the starting line here. A better-than-expected report, rosy guidance, and positive news on the content and YouTube TV fronts will send the shares rallying again. The news -- and the stock -- can naturally also go the other way. Yes, Roku stock has a lot to prove here.