Roku, a key enabler of the streaming revolution, reported strong first-quarter results that sent its stock surging in after-hours trading.
Revenue of $206.7 million handily beat Wall Street forecasts of $192 million. On an adjusted basis, EBITDA swung to $10 million from a loss of $800,000 in the year-ago quarter.
Shares in the independent company soared after hours on the results, gaining nearly 9% to $70. They finished the regular trading day at $64.92, up almost 1%.
The company has gradually been moving away from its initial hardware focus to growing advertising and licensing revenue streams. It has struck partnerships not only with content providers for carriage on Roku Channels or advertising placements on the platform, but also with smart-TV manufacturers to integrate the company’s acclaimed user interface into those sets.
“We estimate that Roku TVs sold by our OEM partners accounted for more than one-in-three smart TVs sold in the U.S. in Q1, as we gained significant market share,” CEO and founder Anthony Wood and CFO Steve Louden wrote in a letter to shareholders.
Average revenue per user climbed 27% to $19.06 in the period.
While ARPU doesn’t correlate directly with how much time viewers spend watching programming via Roku, the shareholder letter took note of the quarterly growth in consumption as a tailwind for the company.
“Roku platform engagement continues to strengthen, as more content shifts to streaming and more consumers cut the cord. Per household streaming grew to an average of roughly 3.5 hours a day per active account, representing nearly half of average U.S. per-household daily viewing,” the letter said. “Increased user engagement reflects our popularity and brand affinity and should drive higher monetization over the long run.”