Roku Inc (ROKU-Q)

EPS was -35c, vs estimates of -63c. Sales were $881M vs $850M estimates. The stock is down as management noted it expects EBITDA to moderate in the second half of the year. Average revenue per user could decline. Sales did rise 19% in Q1. Though 2Q guidance was in line with consensus, it may be premature to assume pressures have eased. Tough comparisons will create 2Q headwinds and higher marketing spending will likely weigh on 2H Ebitda. Average revenue per user in 1Q improved sequentially, but there is growing competition in the connected-TV ad space, especially with the launch of Amazon Prime video ads. Comparisons are tough in part due to a cooldown in the streaming wars and a lapping of price hikes, which may crimp platform revenue gains to high-single-digits. While platform gains should accelerate in 2025, pressures may build after the Walmart-Vizio deal closes, especially in active account growth. The outlook is certainly 'less great' but with the stock decline we think this is reflected in the new valuation.
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Is surprised with how well it's doing, but people watch content by streaming, which is Roku's wheelhouse. Shares are up 50% this month, up too much for him.

The stock is trading back at levels not seen since summer 2018, but a year ago was over $500 ($70 today). Is now at lows of 2020. The bst days for Roku are behind them, and after the sell-off in recent years, Roku remains an expensive stock.

Beat handily today, but last October they guided to an 8% earnings decline, so the bar was set low. The chart is a disaster, so reporting anything less than a disaster would mean a rally.