Shares of Roku Inc. sank 22.36% on Thursday’s extended trading following disappointing fourth-quarter revenue and first-quarter guidance.
The California-based video streaming giant slashed 32.36 points to $112.35 per share. This plunge sent the firm to a drop of $4.35 billion in its market capitalization.
It extended its broad weakness of 10.37% to $144.71 per share during the regular trading session.
Over the past year, it has provided a total return of -68.30%. This performance is further down from the S&P 500’s average return of 11.40%.
Accordingly, Roku released its Q4 FY 2021 earnings results on February 17. Its quarterly revenue came at $865.30 million, below the market consensus of $894.00 million.
Still, the figure represented a 33.00% annual growth from the $649.90 million in the same period in 2020.
However, it indicated a slowing growth compared to the 51.00% gain in the previous quarter and 81.00% in the second quarter.
Subsequently, its Platform segment generated $703.60 million in revenue, lower than the anticipated $732.20 million.
It edged up 49.00% year-over-year from the prior record of $471.20 million. Yet, it came in lower than its 82.00% jump in the third quarter.
This unit includes digital advertising subscriptions and branded buttons on remote controls sales.
Player Q4 revenue, the sales of streaming players and audio devices, was $161.70 million.
It is below the market projection of $162.50 million, representing a 9.00% drop to $178.10 million from a year earlier.
Meanwhile, Roku released an EPS of $0.17 per share, crushing the projected $0.09. Nevertheless, it weakened 65.30% compared to the $0.49 in the year-ago quarter.
Roku Active Accounts
On the other hand, Roku active account climbed 17.40% YOY to 60.10 million. It is more than the expected 59.50 million and the result of 51.20 million a year earlier.
In addition, the report reflected the slowest pace of quarterly growth in at least the past four years.
The firm attributed the slowdown to the global supply chain disruptions that have weighed down the US TV market.
In line with these figures, Roku anticipated a total net revenue of $720.00 million in Q1 FY 2022.
This outlook reflects an annual increase of 25.00%, but below the analysts’ estimate of $748.50 million.
Roku further noted that the supply chain disruptions could continue throughout 2022, thus affecting the TV industry.
Consequently, it mentioned that TV unit sales would likely remain below pre-pandemic levels. Hence, this forecast could adversely affect its active account growth.
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