Roku (ROKU) To Report Earnings Tomorrow: Here Is What To Expect

Max Juang /
2023/10/31 3:00 am EDT

Streaming TV platform Roku (NASDAQ: ROKU) will be announcing earnings results tomorrow after market close. Here's what to expect.

Last quarter Roku reported revenues of $847.2 million, up 10.8% year on year, beating analyst revenue expectations by 9.38%. It was a strong quarter for the company, with an impressive beat of analysts' revenue estimates and solid growth in its user base. The company reported 73.5 million monthly active users, up 16.5% year on year.

Is Roku buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Roku's revenue to grow 12.4% year on year to $855.7 million, in line with the 12% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$1.73 per share.

Roku Total Revenue

The analysts covering the company have been growing increasingly bullish about the business heading into the earnings, with revenue estimates seeing six upwards revisions over the last thirty days. The company missed Wall St's revenue estimates three times over the last two years.

Looking at Roku's peers in the consumer subscription segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. Coursera delivered top-line growth of 21.4% year on year, beating analyst estimates by 4.21%, and Netflix reported revenues up 7.77% year on year, exceeding estimates by 0.02%. Coursera traded up 15.6% on the results, and Netflix was up 11.6%.

Read our full analysis of Coursera's results here and Netflix's results here.

The fears around raising interest rates have been putting pressure on tech stocks and while some of the consumer subscription stocks have fared somewhat better, they have not been spared, with share price declining 7.35% over the last month. Roku is down 20% during the same time, and is heading into the earnings with analyst price target of $83.4, compared to share price of $56.4.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

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The author has no position in any of the stocks mentioned.