I was having some smoked salmon with a bit of dill after the bell when I was approached by someone asking about the ROKU earnings report that just came out and positively raped shareholders for 18%.
Here’s the ‘news’.
Roku beats by $0.17, beats on revs; guides Q1 revs below consensus; guides FY18 revs above consensus (41.10 -0.08)
Reports Q4 (Dec) pro forma earnings of $0.06 per share, $0.17 better than the two analyst estimate of ($0.11); revenues rose 27.8% year/year to $188.3 mln vs the $182.54 mln Capital IQ Consensus. Platform rev +129% to $85 mln; player rev -7% to $103 mln.Q4 2017 gross profit grew materially faster than revenues, up 64% year-over-year to $73.5 million driven by an increasing mix of higher-margin platform revenue which represented 87% of total gross profit in the fourth quarter of 2017, up from 65% in fourth quarter of 2016. This was a key driver of gross margin expansion of 9 percentage points to 39% in the fourth quarter of 2017.
Active Accounts increased 44% YoY to 19.3 million at quarter end; Streaming Hours grew 55% YoY to 4.3 billion hours; Average Revenue Per User (ARPU) grew 48% YoY to $13.78 (trailing twelve-month basis).
Co issues downside guidance for Q1, sees Q1 revs of $120-130 mln vs. $131.71 mln Capital IQ Consensus Estimate; gross profit $52-58 mln; EBITDA ($16-10) mln
Co issues upside guidance for FY18, sees FY18 revs of $660-690 mln vs. $661.58 mln Capital IQ Consensus Estimate; gross profit 275-295 mln; EBITDA ($25-10) mln.
“We enter 2018 with strong momentum and are very encouraged by the trends we are seeing in our Platform segment which we expect to contribute the majority of our total net revenue in 2018, and the vast majority of our total gross profit. Given the trajectory of the Platform segment, we expect rapid revenue growth and gross margin expansion to continue in 2018. We plan to remain focused on driving active account growth, overall gross profit dollar growth, and increasing customer value. Our profitability goal for the year is to operate our business at, or near, break-even on an operating cash flow basis while we reinvest gross profit into strategic areas that can drive continued long-term growth.”
Ooh, everyone is so surprised now because ROKU missed earnings and its shares are no longer viable on the exchange — a total fucking waste of time and money. But, had you done your research and took the time to READ THE PROSPECTUS, like our beloved James Cramer likes to warn, you would’ve known the risks.
Here, I grabbed an extract from the ROKU S-1 for your reading enjoyment.
See, it’s all there in black and white, outlining all of the many risks associated with buying ROKU. Ultimately, as technology evolves and Apple gets even bigger, ROKU will just go away — like a bad dream on a rainy summer night.
You have only yourselves to blame.
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Or maybe they should just realize that if a stock goes from $14 to $50 in less than 6 months, there is potential downside risk at earnings.
Interesting prospectus. They have exempted themselves from Sarbanes-Oxley. I didn’t know that was possible.
Fury was hard core. Brad Pitt at his best.
Nice catch. It looks like they are exempt for 5 years from Sarbanes Oxley.
This is to protect companies from being overburdened by heavy-handed regulations such as having a 3rd party accounting firm verify that they aren’t making up all their numbers. Of course, this only applies to “emerging growth companies” (EGCs). You know, small mom-and-pop companies that are only pulling in hundreds of millions in revenue like Dominoes Pizza, Public Storage, and Pier One (ECG is defined as revenue < $1,000,000,000.00).
dneTW, EGCs are any company
Yeah, that section of the prospectus reads like a cut and paste of a thousand other prospecti(sp?).