Roku Stock Tumbles on Disappointing Outlook, Plan To Withhold Streaming Numbers

KEY TAKEAWAYS

• Roku shares are tumbling 15% in premarket trading Thursday, a day after the company posted a disappointing fourth-quarter outlook and said it would stop issuing quarterly household streaming figures starting next year.
• For the fourth quarter, Roku said it expects a net loss of $65 million, which is wider than the $57.6 million consensus loss of analysts polled by Visible Alpha.
• Roku also said that starting from the first-quarter fiscal 2025 earnings results, it no longer would report quarterly updates on streaming households, a move similar to that announced earlier this year by Netflix.

Roku (ROKU) shares are tumbling 14% in premarket trading Thursday, a day after the company posted a disappointing fourth-quarter outlook and said it would stop issuing quarterly household streaming figures starting next year.

For the fourth quarter, Roku said it expects a net loss of $65 million, which is wider than the $57.6 million consensus loss of analysts polled by Visible Alpha. It also forecast total net revenue of $1.14 billion, which was in line with estimates.

Plan To Withhold Streaming Numbers Follows Similar Move by Netflix

Roku also said that starting from the first-quarter fiscal 2025 earnings results, it no longer would report quarterly updates on streaming households. Its decision to withhold the user data follows a similar one by Netflix (NFLX), which in April said that it would stop reporting subscriber data starting in 2025, and focus instead on financial metrics.

During the third quarter, Roku reported 85.5 million in streaming households, up from 75.8 million a year ago and 83.6 million last quarter.

Roku topped the $1 billion revenue mark for the first time at $1.06 billion, up 16% year-over-year and topping estimates. It narrowed its net loss to $9.03 million, or $0.06 per share, also better than projections.

Roku shares had lost 15% of their value this year through Wednesday’s close.