Roku Q3 revenue beats estimates on advertising, subscription growth
ROKU•Roku's third-quarter revenue rose 24% year over year to $1.50 billion, beating the $1.41 billion analyst consensus, while EPS increased to $1.20 from $0.16 a year earlier. The company will not provide an outlook or hold an earnings call while its acquisition by Fox remains pending.
1. Revenue and earnings rise
Roku reported third-quarter revenue of $1.50 billion, up 24% year over year and above the $1.41 billion analyst consensus. EPS rose to $1.20 from $0.16 a year earlier.
2. Margins and outlook
Advertising gross margin expanded about 470 basis points to 63.2%, primarily because of a shift toward higher-margin advertising products. Subscription gross margin declined roughly 180 basis points, with the strategic shift toward Premium Subscriptions its largest factor; Devices gross margin was negative 25.1% as revenue grew 33% year over year and memory costs remained elevated. Roku will not provide a financial outlook or hold an earnings call while its acquisition by Fox is pending.
