Stock Track | Roku Plunges 5.29% in Pre-market as Q4 Revenue Growth Forecast Disappoints Investors

Stock Track
Oct 31

Shares of Roku Inc (ROKU) experienced a significant pre-market plunge of 5.29% on Friday, following the release of the company's third-quarter earnings report and fourth-quarter forecast. Despite reporting better-than-expected Q3 results, Roku's outlook for slower revenue growth in the coming quarter has unsettled investors.

The streaming platform provider reported Q3 revenue of $1.211 billion, slightly surpassing analyst expectations of $1.206 billion. Earnings per share came in at $0.16, beating the consensus estimate of $0.09. However, Roku's forecast for the fourth quarter has raised concerns among investors. The company expects Q4 revenue growth to slow to 12%, down from the 14% growth reported in Q3. This deceleration, coupled with projected platform segment growth of only 15% in Q4, seems to have overshadowed the positive aspects of the earnings report.

Roku faces stiff competition in the ad-supported streaming market from tech giants such as Amazon, Google, and Apple. The company's cautious outlook may be attributed to ongoing economic uncertainties and a challenging environment for platforms dependent on ad revenue. As competition intensifies in the streaming and advertising sectors, Roku's ability to maintain growth and profitability will be closely watched in the coming quarters.

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