Roku Slumps as Softer Outlook Offsets Earnings Beat in Q3

Investing.com – Roku (NASDAQ:) downgraded its full-year guidance even as third-quarter results topped analyst’s expectations, driven by a surge in active users.

The streaming-device company downgraded its full-year adjusted earnings (EBITDA) outlook to a range of $30 million to $35 million from a previous range of $30 million to $40 million. The downgraded guidance was blamed on continued investment in the business as well as an approximately $5m headwind related to dataxu operations and dataxu-acquisition-related expenses.

Roku a loss per share of 22 cents on revenue of $260.9 million, compared with consensus estimates from Investing.com for a loss of 28 cents on revenue of $256.11 million.

The outperformance was driven by a surge in active accounts, average revenue per user (ARPU) and streaming hours that support the company’s efforts to boost ad-revenue growth.

The company said it reached 32.3 million active users during the quarter, up 36% from the same period last year and 1.7 million more than it had in the prior period.

Average revenue per user (ARPU) was up $1.52 to $22.58 from the second quarter of 2019.

Roku was down more than 13% in post-market trading.

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