What's Going On With Roku Shares Friday?
Portfolio Pulse from Nabaparna Bhattacharya
Roku, Inc. (NASDAQ:ROKU) shares fell on Friday, reversing gains from Thursday after reporting Q1 earnings. Gross profit rose 15% year-over-year to $388 million, but gross margin contracted. The company anticipates normal seasonal spend in H2, affecting Adjusted EBITDA. Roku reported a 14% increase in streaming households and a 23% increase in streaming hours year-over-year. The Roku Channel's streaming hours grew 66%. Q2 revenue is expected to exceed consensus estimates. Roku's cash reserves stand at $2.06 billion. ROKU stock is down 8.5% to $57.44. ARKK and ARKW ETFs offer exposure to ROKU.
April 26, 2024 | 1:38 pm
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NEGATIVE IMPACT
ARK Innovation ETF, which includes Roku in its holdings, may see indirect impact from Roku's earnings report and subsequent share price movement.
Given ARKK's exposure to Roku, the ETF might experience an indirect negative impact due to Roku's share price decline, reflecting the interconnectedness of ETF holdings and individual stock performances.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
ARK Next Generation Internet ETF, holding Roku shares, could be indirectly affected by Roku's Q1 earnings and its stock's performance.
ARKW, by holding Roku, may face indirect negative impacts from Roku's earnings report and the subsequent decline in Roku's stock price, highlighting the effect of individual stock movements on ETFs.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
Roku shares fell after Q1 earnings report, despite growth in gross profit and streaming households. Gross margin contraction and future spending plans may concern investors.
The drop in Roku's share price despite positive growth indicators suggests investor concern over margin contraction and anticipated spending. The significant share price movement indicates a strong reaction to the earnings report.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100