Roku beat forecasts in the first quarter, traditionaly its softest, as people continued their shift to streaming, with revenues jumping 79 percent from the year before and the net result moving to an unexpected profit. The company added 2.4 million incremental accounts in the quarter, for a total of 53.6 million, driven by sales of players and Roku TV models in the US and abroad. Streaming increased by 1.49 billion hours over the last quarter, to 18.3 billion.
Quarterly revenues reached USD 574.2 million, with platform revenue leaping 101 percent to USD 466.5 million and player revenue up 22 percent to USD 107.7 million. The gross profit jumped 132 percent to USD 326.8 million and the adjusted EBITDA went to 125.9 million, from a loss of 16.3 percent. The operating result also moved to a profit, to USD 75.8 million from a loss of 55.2 million while the net result went to a positive USD 76.8 million from a negative 54.6 million. ARPU grew 32 percent to 32.14.
For the second quarter, Roku is guiding for revenues up 73 percent to USD 615 million at the midpoint, with gross profit rising 104 percent to USD 300 million at the midpoint, and the adjusted EBITDA reaching USD 65 million at the midpoint.
The platform business should have an easy year-on-year comparison in the quarter, and then progressively face more difficult comparisons as the year progresses, reflecting the pullback in TV ad spend in Q2 2020 amid the virus pandemic and subsequent shift of ad budgets in Q3 2020 to digital, and in particular to Roku. The company also benefitted from the launch of many premium DTC services in the second half of 2020.
The player business will face comparison headwinds in Q2 and especially in Q3, before returning to more normalized comparison bases in Q4. Supply chain constraints are expected to continue also for the rest of the year, with costs for components and logistics likely increase as the year progresses. This will result in slightly negative margins for Q2 and H2.
Operating expenses (opex) will grow significantly as 2021 progresses, pushing adjusted EBITDA higher in H1 than in H2.
