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Shares of Roku Inc (NASDAQ: ROKU) are up in after-hours trading after beating third-quarter earnings estimates with strong advertising growth.
Financials: In the third quarter, Roku had revenue of $451.7 million. This was a 73% year-over-year increase for the company and easily beat Street consensus estimates of $366.3 million.
The company’s earnings per share total of 9 cents for the third quarter came in ahead of consensus of a loss of 40 cents.
Over 14.8 billion hours were streamed with Roku devices in the third quarter.
Average revenue per user was $27 for the trailing 12-month period.
Related Link: Roku Dips As Comcast Could Be Eying Smart TV Market
User Growth: Roku added 2.9 million accounts and ended the third quarter with 46 million accounts.
The Roku Channel reached 54 million households at the end of the third quarter. The channel grew two times faster Roku’s overall platform.
Advertising: Roku reported video advertising grew 90% year-over-year in the third quarter. This outpaced the 50% year-over-year growth reported in the second quarter.
Roku highlighted DraftKings Inc (NASDAQ: DKNG) as a company that tripled its advertising spending with the company in the quarter.
The company saw first time advertising clients more than double in the third quarter from the previous year. Retention of advertising clients from last year’s third quarter was 97%.
What’s Next: Roku launched its Roku Express players in Brazil in October.
Roku expects fourth-quarter revenue growth to come in the mid-40% area, similar to the last few holiday quarters.
Shares of Roku closed Thursday's session up 4% to $225.06 and the stock was up 2.6% in after-hours trading.
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