Should Investors Worry About Roku's Negative Hardware Gross Margin?
For the fourth straight quarter, Roku's (NASDAQ: ROKU) player segment, which includes revenue from sales of its popular media sticks, posted a negative gross margin. To blame are the usual suspects, like supply-chain issues and inflation, which are causing higher input costs that aren't being passed on to customers.
While this situation might cause investors to sour on the stock, which is down 58% in 2022, management is making the correct decision by not raising prices. Contrary to what many observers might think, Roku's hardware business is not the company's bread and butter.
Let's take a closer look.
Source Fool.com
