Wall Street Cheers Roku Outlook For Full-Year Profit; Q3 Results Miss Estimates But Active Accounts Rise To 75.8M And Cost-Cutting Benefits Start To Materialize

Shares in Roku surged almost 10% in after-hours trading after the company affirmed its outlook for “positive full-year EBITDA,” meaning a return to profitability.

The streaming giant posted third-quarter revenue of $912 million, beating Wall Street analysts’ expectations, though an adjusted loss of $2.33 per share was wider than Street forecasts.

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While the quarterly results were mixed, the company said it saw an uptick of 2.3 million active accounts since last quarter, to a total of 75.8 million. The number of total hours streamed across Roku devices in the trailing 12 months also topped 100 billion for the first time.

While it remains a dominant gatekeeper for streaming, with an interface built into one-third of smart TVs in North America and tens of millions of connected devices, Roku encountered turbulence earlier this year. In September, the company said it would lay off 10% of its workforce and conduct a “strategic review” of its content portfolio.

In its quarterly letter to shareholders, the company said its 20% year-over-year increase in revenue, “in addition to cost reductions and measures we announced in September to further reduce our YoY OpEx growth rate, enabled us to deliver positive adjusted EBITDA.”

EBITDA, or earnings before interest, taxes, depreciation and amortization, is a common metric in the media business, designed to give an accurate sense of profits given the variability of expenses.

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