Streaming TV technology firm Roku blew past Wall Street expectations on Thursday, reporting higher platform and hardware revenue and an uptick in the number of monthly active users.
Total net revenue during the first three months (Q1) of 2024 clocked in at $882 million, up 19 percent on a year-over basis, spurred by an increase in platform revenue that raked in $754.9 million during Q1. Platform revenue includes advertising sold against free streaming content in the Roku Channel, as well as money earned from the sale of certain third-party subscriptions on Roku’s connected TV system.
Sales of Roku-powered streaming pucks, soundbars and TV sets helped juice the company’s hardware revenue to $126.5 million during Q1, spurred by higher retail sales during the critical Super Bowl shopping period. During Q1, the company added more than 1 million new customer accounts, bringing its total monthly average user base to 81.6 million around the world, Roku said.
More customers and higher overall revenue helped the company narrow its net loss to $50.8 million during the quarter, or 73 percent lower than the $193 million Roku reported during Q1 2023.
Executives said new home screen experiences across Roku devices, including dedicated “Sports Zones” for professional football and basketball, helped drive higher interest and engagement from streamers who are increasingly moving away from cable and satellite toward connected TV platforms.
Roku also introduced more personalized content suggestions on its home screen by leveraging generative artificial intelligence (AI) to recommend shows and movies to watch based on a user’s viewing habits, the company said.
“With insights and learnings from these destinations, we are creating more Home Screen experiences that we can scale for the benefit of viewers and marketers — particularly those who want to sponsor tent-pole content and events,” executives said in a letter to shareholders released with its Q1 2024 earnings on Thursday.
Total streaming hours eclipsed 30.8 billion during Q1, an increase of around 5.7 billion hours on a year-over basis. Linear channels and on-demand content distributed via the Roku Channel saw a 66 percent increase in streaming hours during Q1, the company affirmed.
Roku is now looking for more opportunities to drive viewer interest to the Roku Channel and sponsored content tiles and windows across Roku devices, executives said. Over the past few weeks, Roku has already made some strides in embracing unique content experiences and events to raise awareness of certain content, including a pact with NBC Universal that sees Roku distributing clips from programs like “The Tonight Show” and “Saturday Night Live” through a dedicated section on the Roku Channel.
