Roku announced the addition of 1.8 million active users in the second quarter, upping its U.S.-leading base of connected TV customers to 63.1 million.
The figure represented re-accelerated growth for Roku, which only added 1.2 million active users in the first quarter and 1.5 million in the second quarter of 2021. Roku attributed that growth to improved smart TV shipments and pricing.
And Roku also saw its advertising revenue grow by 4% sequentially, and 26% year over year, to $673.2 million, partially driven by record upfront commitments that exceeded $1 billion.
Roku reported 21% year-over-year growth in average revenue per user, with that figure reaching a record $44.10.
Still, Roku reported a narrow decline in the number of hours its users spent on its platform — the first time we’ve ever seen that — and Roku fell short of the consensus forecasts conjured by TMT equity analysts, particularly in the area of ad-driven platform revenue. Roku projected only weak platform revenue growth to $700 million for the third quarter, for example (it’s all in the pullout chart from the shareholders letter (opens in new tab) at the bottom of this story).
And the investment community continues to find plenty of things to not like about Roku. The stock was down another 25-plus percentage points in after-hours trading, as Roku reported a narrow decline in the amount of streaming hours spent on its platform relative to Q1.
“There was a significant slowdown in TV advertising spend due to the macro-economic environment, which pressured our platform revenue growth,” Roku executives said in a letter to shareholders (opens in new tab). “Consumers began to moderate discretionary spend, and advertisers significantly curtailed spend in the ad scatter market (TV ads bought during the quarter). We expect these challenges to continue in the near term as economic concerns pressure markets worldwide.”
Assessing the damage, Insider Intelligence analyst Ross Benes said, “These signs indicate that exuberance over streaming video advertising is tamping down due to challenging economic conditions.”
Roku reported a net loss of $112.3 million in Q2 compared with a net loss of $149.8 million in the same quarter last year. It lost $22 million selling gadgets vs. $6.7 million in Q2 2021.
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