Roku announced solid subscriber growth, but unmet revenue targets, for the close of Q4 2021. Brandon Blake, Blake & Wang P.A entertainment lawyer and industry expert, unpacks the figures and fills us in on some key news and developments.
Below Wall Street Expectations
While Roku managed to onboard subscribers to take it to 60.1M active users in the last quarter of the year, its total revenue of $865.3M fell short of Wall Street Benchmarks. This has been mostly attributed to supply chain issues delaying new purchases in the US TV market. While this is expected to also adversely impact Q1 for this year, total revenue for the upcoming Quarter is currently estimated as $720M. However, there were other positive growth indicators, too. Streaming hours grew by a modest $1.5B, and the CEO seemed very happy with overall results despite the Wall Street naysayers.
A New Smart TV?
What Louden couldn’t be drawn on, however, was whether there’s any traction in rumors that Roku will be looking to create its own TVs. We do know, however, that Roku’s platform chief, Scott Rosenberg, will be exiting the company as of spring. He will be replaced by former NBC direct-to-consumer president, Gidon Katz. Oddly, however, Rosenberg insists this isn’t a direct placement, describing his role as ‘monetizing’ the platform and the new role more about user experience, visual design, and experience creation. It’s an odd line to draw in the sand, really.
All the same, while Wall Street may be grumbling about their expected benchmarks, Roku’s managed to onboard a fair chunk of subscribers at a time where that’s no longer easy to do. And, distribution chain challenges aside, it’s turned a decent profit doing so, too. We will be watching Q1 results with great interest.
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