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ROKU Stock Loses Over 30% as Roku Reports Q4 and FY 2021 Financial Results

UTC by Steve Muchoki · 2 min read
ROKU Stock Loses Over 30% as Roku Reports Q4 and FY 2021 Financial Results
Photo: Nasdaq / Twitter

Nevertheless, Roku through its earnings report is confident that 2022 and the years ahead will be characterized by increased revenue and global new viewerships.

Roku Inc (NASDAQ: ROKU) stock closed Thursday, February 17, 2022, trading at $144.71, down 10.37 percent from the day’s opening price. The losses were exaggerated during the after-hours trading session with a decline of approximately 22.36 percent as of Feb 27, 2022, 7:59 p.m EST. Notably, the sharp Roku stock decline in a day has largely been attributed to the rather disappointing fourth quarter and 2021 financial results.

According to the company’s report, time spent on television has significantly increased but the ad sector has not experienced similar revenue growth. Consequently, the company forecasts a tougher time.

Nevertheless, Roku through its earnings report is confident that 2022 and the years ahead will be characterized by increased revenue and global new viewerships.

“We have an enormous opportunity ahead of us around the world. Time spent on TV streaming is increasing but is not yet equivalent to time spent on legacy TV, and ad budgets still significantly lag TV streaming viewership. With our competitive advantages — the Roku OS, The Roku Channel, and our ad platform built for TV streaming — we are strongly positioned to capture this opportunity,” the company wrote in a letter to investors.

According to media outlet CNBC, a survey conducted by Refinitiv says analysts expected Roku to report adjusted earnings per share of 9 cents on revenue of $894 million. However, the streaming giant reported adjusted earnings per share of 17 cents on revenue of $865.3 million.

Further Notes on Roku Financial Results and Market Outlook

The market dump experienced on Thursday heightened the losses that Roku shares have recorded in the past year. According to market data provided by MarketWatch, Roku shares are down approximately 68 percent, 36 percent, and 38 percent in the past year, YTD, and three months respectively.

In 2021, the company’s total net revenue grew by 55 percent year over year to $2.765 billion. Platform’s revenue increased 80 percent year over year to $2.285 billion.

The company’s gross profit was up 74 percent year over year to $1.409 billion. Notably, active accounts in 2021 reached 60.1 million, a net increase of 8.9 million from the fourth quarter of 2020.

In other highlights, Streaming Hours increased by 14.4 billion hours YoY to 73.2 billion. Additionally, the Average Revenue Per User (ARPU) grew to $41.03 (trailing 12-month basis), up 43 percent YoY. Of note, Roku was voted as the No. 1 TV streaming platform in the US, Canada, and Mexico by hours streamed.

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Steve Muchoki

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