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Roku to report Q3 earnings on Wednesday: What to expect

Roku Inc. (NASDAQ: ROKU) is scheduled to report third quarter 2019 earnings results on Wednesday, November 6, after the market closes. Analysts expect the company to report a loss of $0.28 per share on revenues of $256 million. The stock is likely to rise or fall depending on a beat or miss on the results.

The company is expected to benefit from growth in active accounts and streaming hours. These, along with average revenue per user (ARPU), are important metrics to watch. Last quarter, active accounts grew 39% while streaming hours increased 72%. ARPU saw a growth of 27% year-over-year.

Roku reports Q2 2019 earnings results

Analysts believe Roku has massive growth opportunities in areas such as advertising and licensing. The company is expected to benefit from the arrival of more streaming services into the market and the rise of cord-cutting. Last month, Roku announced the availability of the Apple TV app and Apple TV+ on its platform.

The television advertising market is a vastly lucrative area and Roku has ample chance to carve a space for itself here. The acquisition of Dataxu, a demand-side platform that helps marketers plan and buy video ad campaigns, will aid Roku in achieving this target. The spending on OTT advertising is projected to increase over the coming years.

In the second quarter of 2019, Roku beat market estimates on revenue and reported a narrower-than-expected loss. Revenues jumped 59% year-over-year to $250.1 million, driven by growth in advertising. The company reported a loss of $0.08 per share versus the loss of $0.22 per share expected by analysts.

Also see: Roku Q2 2019 Earnings Conference Call Transcript

For the third quarter, Roku has guided for revenues of $250-255 million and net loss of $40 million to $34 million.

For full-year 2019, the company expects a net loss of $71-61 million on revenues of $1.07 billion to $1.09 billion. Platform revenue is expected to represent roughly two-thirds of total revenue.

Roku’s shares have gained 361% year-to-date and 32% in the past one month. The stock was down over 3% in midday trade on Monday.

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