Roku Slides as Reopening Leads to Less Streaming Viewing

(Bloomberg) — Roku Inc. shares tumbled in extended trading on Wednesday after it reported second-quarter results that missed expectations on key metrics.

The video-streaming platform company reported 55.1 million active customer accounts for the quarter and 17.4 billion streaming hours. The Bloomberg Consensus estimate had been for 55.8 million active customer accounts and 19.19 billion streaming hours.

“In the near term, the varying rates of recovery from the pandemic around the world continue to present an uncertain operating environment,” the company wrote in a letter to shareholders. It added that the loosening of restrictions related to the pandemic had led to a broader secular decline in overall TV viewing.

Shares fell 7% after the market closed.

“We will definitely face difficult year-over-year comparisons in the back half of the year in terms of active accounts and streaming hours, but streaming video is a secular trend, not just a pandemic trend,” Steve Louden, Roku’s chief financial officer, said in an interview. “We feel good about the continued shift to streaming by viewers, and about advertising dollars continuing to move to streaming” and away from linear TV.

Roku forecast third-quarter net revenue of $675 million to $685 million. The analyst consensus is for revenue of $646.5 million.

For the second quarter, Roku revenue came in at $645.1 million, above the $613.1 million estimate.

Shares of Roku are down about 12% from a record close hit in July, though it remains up nearly 50% from a May low, based on its most recent close. The stock rose 0.6% in Wednesday’s regular session.

(Adds CFO comments and updates trading.)

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