Today's video focuses on Roku's (ROKU +2.85%) earnings, reported on Nov. 3, after the market closed, and why its stock price dropped. Here are some highlights from the video.
- Roku reported third-quarter revenue of $680 million, up 51% year over year (YOY) and 5% quarter over quarter. The revenue growth was driven by its platform segment, which increased 82% YOY. Active accounts also increased and reached 56.4 million accounts, up 23% YOY.
- Unfortunately, supply chain issues have hurt Roku's growth. TV sales are below pre-COVID levels, which means fewer Roku TVs and less hardware is being sold, leading to slower growth of active accounts. Investors could be hopeful that Roku is expanding its TV footprint in Latin America later this year.
- Margins on hardware have decreased due to the increased cost of shipping logistics and components. Roku has no plans to increase its products' prices, as it is focused on grabbing as much market share as possible. Management believes that the decrease in margins will be temporary and is focused more on long-term user growth.
Click the video below for my full thoughts and analysis.
*Stock prices used were the closed prices of Nov. 5, 2021. The video was published on Nov. 7, 2021.
