We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Roku (ROKU - Free Report) reported fourth-quarter 2021 earnings of 17 cents per share, outpacing the Zacks Consensus Estimate of 6 cents. The company reported earnings of 48 cents per share in the year-ago quarter.
Revenues increased 33.1% from the year-ago quarter’s level to $865.3 million but missing the consensus mark by 3.2%.
Growth of the Roku Channel in reach and engagement drove fourth-quarter performance. Active accounts rose 17% year over year to 60.1 million, driven by the popularity of Roku streaming players and Roku TV models. Streaming hours also rose 15% year over year to 19.5 billion.
The average revenue per user rose 43% from the prior-year quarter’s levels to $41.03 (on a trailing 12-month basis).
For the fourth quarter, Roku’s monetized video ad impressions surged 67% on a year-over-year basis driven by an increase in client acquisition, retention and spending per client.
Platform revenues (81.3% of revenues) surged 49.3% year over year to $703.6 million, driven by significant increases in content distribution activities and advertising.
However, Player revenues (18.7% of revenues) declined 9.5% from the year-ago quarter’s level to $161.7 million.
In the fourth quarter, Roku announced the global expansion of its Roku TV Ready Certification Program. The expansion of the certification program makes it easier for third-party audio partners to join the platform seamlessly.
New partners of the company added through the tenure of 2021 include JVC, Element, Pheanoo and Philips.
Polk Audio and Westinghouse are scheduled to join the platform in early 2022. The program has also been expanded internationally with several audio partners, launching in Canada, Mexico and the U.K.
Operating Details
Gross margin, as a percentage of total revenues, contracted 310 basis points (bps) from the year-ago quarter’s level to 43.9%.
Operating expenses increased 49.1% year over year to 358.3 million. As a percentage of total revenues, the metric expanded 440 bps.
As a percentage of total revenues, research & development were breakeven year over year, while sales & marketing and general & administrative expenses expanded 410 bps and 30 bps, respectively, on a year-over-year basis.
For the fourth quarter, adjusted EBITDA margin — as a percentage of total revenues — contracted 740 bps year over year to 10%.
Operating income was $21.4 million in the reported quarter compared with $65.2 million in the year-ago quarter.
Balance Sheet
As of Dec 31, 2021, cash and cash equivalents were $2.15 billion compared with $2.18 billion as of Sep 30, 2021.
As of Dec 31, 2021, the company reported total debt of $89.9 million compared with $91.1 million on Sep 30, 2021.
Guidance
For first-quarter 2022, Roku expects total net revenues of $720 million. The Zacks Consensus Estimate is currently pegged at $762.83 million.
Gross profit is anticipated to be $360 million. The company expects adjusted EBITDA to be $55 million.
PlayAGS is set to announce fourth-quarter 2021 results on Mar 10.
AGS is up 15.4% in the past year against the Zacks Gaming industry’s decline of 28.9% and the Consumer Discretionary sector’s fall of 21.3% in the past year.
Accel Entertainment is set to announce fourth-quarter 2021 results on Mar 15.
ACEL is up 28.3% in the past year against the Zacks Gaming industry’s decline of 28.9% and the Consumer Discretionary sector’s fall of 21.3%.
Gildan Activewear is set to announce fourth-quarter 2021 results on Feb 23.
GIL is up 44.8% in the past year against the Zacks Textile – Apparel industry’s decline of 7.6% and the Consumer Discretionary sector’s fall of 21.4%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ROKU's Q4 Earnings Beat Estimates, Revenues Increase Y/Y
Roku (ROKU - Free Report) reported fourth-quarter 2021 earnings of 17 cents per share, outpacing the Zacks Consensus Estimate of 6 cents. The company reported earnings of 48 cents per share in the year-ago quarter.
Revenues increased 33.1% from the year-ago quarter’s level to $865.3 million but missing the consensus mark by 3.2%.
Growth of the Roku Channel in reach and engagement drove fourth-quarter performance. Active accounts rose 17% year over year to 60.1 million, driven by the popularity of Roku streaming players and Roku TV models. Streaming hours also rose 15% year over year to 19.5 billion.
The average revenue per user rose 43% from the prior-year quarter’s levels to $41.03 (on a trailing 12-month basis).
For the fourth quarter, Roku’s monetized video ad impressions surged 67% on a year-over-year basis driven by an increase in client acquisition, retention and spending per client.
Roku, Inc. Price, Consensus and EPS Surprise
Roku, Inc. price-consensus-eps-surprise-chart | Roku, Inc. Quote
Quarter Details
Platform revenues (81.3% of revenues) surged 49.3% year over year to $703.6 million, driven by significant increases in content distribution activities and advertising.
However, Player revenues (18.7% of revenues) declined 9.5% from the year-ago quarter’s level to $161.7 million.
In the fourth quarter, Roku announced the global expansion of its Roku TV Ready Certification Program. The expansion of the certification program makes it easier for third-party audio partners to join the platform seamlessly.
New partners of the company added through the tenure of 2021 include JVC, Element, Pheanoo and Philips.
Polk Audio and Westinghouse are scheduled to join the platform in early 2022. The program has also been expanded internationally with several audio partners, launching in Canada, Mexico and the U.K.
Operating Details
Gross margin, as a percentage of total revenues, contracted 310 basis points (bps) from the year-ago quarter’s level to 43.9%.
Operating expenses increased 49.1% year over year to 358.3 million. As a percentage of total revenues, the metric expanded 440 bps.
As a percentage of total revenues, research & development were breakeven year over year, while sales & marketing and general & administrative expenses expanded 410 bps and 30 bps, respectively, on a year-over-year basis.
For the fourth quarter, adjusted EBITDA margin — as a percentage of total revenues — contracted 740 bps year over year to 10%.
Operating income was $21.4 million in the reported quarter compared with $65.2 million in the year-ago quarter.
Balance Sheet
As of Dec 31, 2021, cash and cash equivalents were $2.15 billion compared with $2.18 billion as of Sep 30, 2021.
As of Dec 31, 2021, the company reported total debt of $89.9 million compared with $91.1 million on Sep 30, 2021.
Guidance
For first-quarter 2022, Roku expects total net revenues of $720 million. The Zacks Consensus Estimate is currently pegged at $762.83 million.
Gross profit is anticipated to be $360 million. The company expects adjusted EBITDA to be $55 million.
Zacks Rank & Stocks to Consider
Roku currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the Zacks Consumer Discretionary sector are PlayAGS (AGS - Free Report) , Accel Entertainment (ACEL - Free Report) and Gildan Activewear (GIL - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
PlayAGS is set to announce fourth-quarter 2021 results on Mar 10.
AGS is up 15.4% in the past year against the Zacks Gaming industry’s decline of 28.9% and the Consumer Discretionary sector’s fall of 21.3% in the past year.
Accel Entertainment is set to announce fourth-quarter 2021 results on Mar 15.
ACEL is up 28.3% in the past year against the Zacks Gaming industry’s decline of 28.9% and the Consumer Discretionary sector’s fall of 21.3%.
Gildan Activewear is set to announce fourth-quarter 2021 results on Feb 23.
GIL is up 44.8% in the past year against the Zacks Textile – Apparel industry’s decline of 7.6% and the Consumer Discretionary sector’s fall of 21.4%.