Roku Q1 2022 Earnings Report Recap

ROKU beat on earnings and on revenue

Key Takeaways

  • The number of active accounts came in at 61.3 million, narrowly missing analysts' estimates.
  • Roku's user base, as gauged by the number of active accounts, is a key measure of the company's ability to generate advertising revenue.
  • Roku expects net revenue growth of about 25% YOY in Q2 FY 2022.
Roku Earnings Results
Metric Beat/Miss/Match Reported Value Analysts' Prediction
EPS Beat -$0.19 -$0.21
Revenue Beat $733.7M $720.8M
Active Accounts   Miss 61.3M 61.5M

Source: Predictions based on analysts' consensus from Visible Alpha

Roku (ROKU) Financial Results: Analysis

Roku, Inc. (ROKU) reported Q1 FY 2022 earnings results on April 28 that surpassed analysts' expectations. The company reported a net loss per share that was narrower than analysts had estimated. Revenue also came in above analyst forecasts, up 27.8% year over year (YOY). The total number of Roku's active accounts came in at 61.3 million for the quarter, just below analysts' expectations.

The company's shares were up nearly 4% in extended trading. Over the past year, Roku's shares have provided a total return of -74.4%, well below the S&P 500's total return of 0.0%.

ROKU Active Accounts

Roku's active accounts rose 14.4% YOY, the slowest pace of growth out of any quarter in at least the past four years. Growth in the company's user base, as measured by active accounts, has been slowing the larger it becomes. Growth in active accounts for each quarter in FY 2018 ranged between 40% and 46% YOY. By FY 2020, that range had fallen to 37% to 42% YOY. Growth continued to slow throughout FY 2021.

Roku defines active accounts as the number of distinct user accounts that have streamed content on its platform sometime within the past 30 days of the period. Streamed content from the Roku Channel only on non-Roku platforms does not count as streamed content for the purpose of measuring active accounts. Also, the metric does not distinguish between unique individuals streaming content on the same account. For example, an account with family members all streaming content on that same account only counts as one active account.

Nevertheless, the number of active accounts will be closely correlated with the number of viewers, or targets for advertisers. The greater the number of active accounts using Roku's platform, the more attractive the platform will be to advertisers, which will attract more ad spending.

ROKU Outlook

Roku said that it expects its net revenue to increase approximately 25% YOY to $805 million in Q2 FY 2022. It expects total gross profit of about $395 million. For full-year FY 2022, the company expects net revenue growth of around 35%.

Roku's next earnings report (for Q2 FY 2022) is expected to be released on Aug. 2, 2022.

Article Sources

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  1. Roku Inc. "1Q22 Roku Shareholder Letter," Page 8.

  2. Roku Inc. "1Q22 Roku Shareholder Letter," Page 1.

  3. Visible Alpha. "Financial Data."

  4. TradingView. "Price Chart: ROKU and S&P 500."

  5. Roku Inc. "Form 10-K for the Year Ended December 31, 2021," Page 50.

  6. Roku Inc. "1Q22 Roku Shareholder Letter," Page 6.

  7. Yahoo! Finance. "Earnings Calendar: ROKU."

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