These are healthy underpinnings for an advertising company and further support the theory that Roku's growth will rebound with the advertising market.Īssuming monetization (average revenue per user) also bounces back, Roku's overall growth will resume as ad spending returns to a platform with a bigger and better audience than before. Streaming hours outgrew the total audience, signaling that time spent per viewer also increased.Roku's audience is getting bigger, and more eyeballs translate to more advertising revenue.That might set off alarm bells in your head - Roku has reached the limit on how much it can squeeze out of a viewer! Or you could consider that the dip resulted from a challenging economic climate in which there are fewer advertising dollars to go around. In its first-quarter earnings, Roku's average revenue per user came in at $40.67, a 5% year-over-year decline. Average revenue per user - How much money is Roku making on viewers?.Streaming hours - How engaged is the Roku viewer base?.Active accounts - How many people use Roku devices?.Is it a Roku problem or an industry problem?Įvery time Roku reports earnings, it puts three important operating metrics near the top of its shareholder letter. Here is why investors should consider jumping on the Roku train before it leaves the station. Analysts are steadily cutting their forecasts for United States advertising spending as brands tighten their purse strings in anticipation of a recession.īut knowing the difference between a temporary setback and a death blow can make all the difference in your portfolio. Roku's secret sauce is its advertising business, and conditions in the industry aren't good right now.
Shares have fallen 88% from their highs, testing the mettle of even the most convicted shareholders. Streaming platform Roku ( ROKU 4.13%) has been a rough stock to own for the past 18 months.
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