Roku Surges To 43M Active Accounts On COVID-Aided Q2 Revenue Growth

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Roku smashed Wall Street analysts’ consensus estimate for revenue in the second quarter, reporting a jump of 42% from a year ago to $356.1 million.

Analysts had expected $315.4 million.

The company now has 43 million active accounts, a rise of 41% over the same period in 2019. The Roku Channel, a key part of the company’s strategy to serve as a comprehensive streaming enabler, grew to reach households with an estimated 43 million viewers in the quarter. Total streaming hours gained 65% to hit 14.6 billion. In the company’s letter to shareholders, the company said streaming hours “moderated since peaking in early Q2,” but said the metric “remains elevated from pre-COVID-19 levels.”

Executives stressed the quarter’s period of increasing streaming investment across a wide range of players old and new. In the last eight months alone, major services like Disney+ and Apple TV+ have come to market, though the two notable 2020 entries — HBO Max and Peacock — are not yet carried on Roku.

The streaming company said it was the No. 1 connected device based on hours streamed for Disney+ in the week following the release of Hamilton, according to Comscore. U.S. Premium Subscription services within The Roku Channel, such as Showtime and Starz, achieved significant subscription gains through extended free trial offers. Movie and TV rentals and purchases hit an all-time high in the quarter, as direct-to-home feature movies like Scoob! and Trolls World Tour premiered on TV streaming services.

On a separate note, the company also announced that CFO Steve Louden will remain in his position. The news is a reversal of a previously announced plan to have him step down because he planned to do the job from his home in Seattle. Roku is based in Los Gatos, CA.

Advertising forecasts from Roku in May that were less than scintillating to some investors put a dent in the shares. The ad market is a crucial one for the emerging company, which initially focused on being a maker of devices before transitioning to a more ad- and licensing-based concern. The letter warned that it will be “well into 2021″ before the TV ad business recovers to pre-pandemic levels. Nevertheless, the company said its position in streaming offers many benefits over that of traditional ad sellers.

“As more and more households turned to streaming in the second quarter, our ad business experienced continued growth at a time when the broader advertising sector is expected to decline,” Scott Rosenberg, SVP and GM of the Roku Platform said in a statement. Contrary to projected declines in linear TV advertising, he added, “our ability to deliver incremental value and incremental reach drove continued growth in Roku’s ad business.”

Rosenberg cited stats such as a 40% year-over-year gain in first-time Roku advertisers, which he called an “important growth indicator.” In June, the company delivered its first presentation to digital ad buyers during the NewFronts, the annual New York showcases that were done in virtual form this year.

This article was printed from https://deadline.com/2020/08/roku-surges-to-43m-active-accounts-on-covid-aided-q2-revenue-growth-1203005276/