Streaming platform Roku saw a slowdown in revenue and user growth in the first three months of 2022, as the company missed Wall Street expectations in terms of top and bottom earnings.
The company reported 61.3 million active accounts for the first quarter, an increase of 14% year over year and consecutive gains of 1.1 million. That compares with 35% growth in the first quarter of 2021, when it collected 2.4 million accounts. Total hours streamed by Roku users in the first quarter was 20.9 billion, also up 14%, compared to 49% a year earlier.
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Total revenue was $734 million, up 28%, turning Roku into a net loss of $26.3 million (loss of 19 cents per share) versus net income of $75.8 million in the last year quarter. On average, Wall Street analysts expected Roku’s first-quarter revenue to come in at $718.1 million and a loss of 18 cents a share, according to financial data provider Refinitiv.
Roku’s platform revenue, which includes advertising deals and content revenue sharing, was $647 million in the first quarter, up 39% — but slowing from growth that fueled the pandemic of 101% in the same period a year earlier.
Roku shares are up more than 5% in after-hours trading, after closing up 8.1% in the regular session. Year-to-date, the stock is down 60%.
The company’s earnings report comes after Netflix reported a net loss of 200,000 subscribers in the first quarter — its first drop in live streaming in more than a decade. Roku ended 2021 with 60.1 million active streaming accounts, up 17% year over year and up 3.7 million in the fourth quarter.
In addition to traditional rivals like Google, Amazon and Apple, Roku will face a new one in the coming years: cable giants Comcast and Charter Communications this week announced a new 50-50 joint venture to create a national US streaming platform, based on Comcast’s Xfinity Flex streaming device.