Roku recorded a strong year of growth in 2017, but its shareprice dropped in after hours trading following a weaker than expected revenue outlook for the current quarter.
Announcing its full year and fourth quarter 2017 results, Roku said that Q4 net revenue grew 28% year-on-year to US$188.3 million, driven by platform growth of 129% YoY to US$85.4 million. Gross profit for Q4 grew 64% year-on-year to US$73.5 million.
The company said that it enters 2018 with strong momentum and is “very encouraged” by the trends it is seeing in its platform segment. However, its Q1 net revenue outlook of US$120 million to US$130 million missed analyst projections of US$132 million, according to Bloomberg stats.
Roku described 2017 as a “milestone year” with revenue growing 29% year-on-year to US$513 million. This compares to revenue growth of 25% in 2016.
A key driver for growth was the company’s platform segment. Here revenues were up 115% year-over-year to a record $225 million, driven by strength across Roku’s advertising and content distribution services.
Full year gross profit grew 65% to US$200 million, streaming hours were up 59% year-on-year to 14.8 billion hours, while active Roku accounts stood at 19.3 million at the end of Q4 – up 44% compared to a year earlier.
Trailing twelve-month ARPU in the fourth quarter was a record US$13.78, up 48% year-over-year.
“The tectonic shifts we are seeing in the media and entertainment industries continue to strengthen our streaming opportunity, creating new paths for Roku to pursue and deliver rapid revenue and gross profit growth,” said Roku CEO Anthony Wood, and CFO Steve Louden, in a statement.
“The fourth quarter of 2017 was a fantastic quarter for Roku, reinforcing our leading position in smart TVs, streaming players, OTT advertising and content distribution. We have never been more excited about the future of our business.”