Roku (NASDAQ: ROKU) is not having a good year in 2022. The company is grappling with the indirect consequences of the coronavirus pandemic, including supply chain disruptions, soaring inflation, and evolving consumer behavior.
These forces work together, bringing down Roku's sales and profits. As a result, Roku's stock is down 85% off its highs. That said, Roku's headwinds are primarily short term. Meanwhile, the widespread consumer shift to streaming content instead of watching through a traditional cable connection is a tailwind. Are Roku's long-term prospects strong enough to overpower the near-term headwinds and make Roku stock a buy? Let's answer that question below.
The coronavirus pandemic was initially positive for Roku's business. People were spending most of their time indoors, and streaming content became one of the most popular pastimes worldwide. Roku's revenue jumped by 57.5% in 2020 and then 55.5% in 2021. However, the secondary consequences of the outbreak soon became a headwind, as inflation boosted costs.
Source Fool.com