Shares of Roku (NASDAQ: ROKU) opened Thursday's trading 17.6% lower following the streaming media expert's release of third-quarter results. Ten minutes before noon EST, the stock had recovered somewhat to a drop of 10.4%.
Roku's third-quarter sales rose 50% year over year to $261 million, powered by a 36% increase in the number of active user accounts and 30% higher average revenues per user (ARPU). On the bottom line, net losses more than doubled from $0.09 to $0.22 per share. Your average Wall Street firm had been looking for a wider net loss of $0.28 per share on just $256 million of top-line revenues, so Roku exceeded the Street's stated expectations across the board.
But the stock came screaming around the bend into this earnings report, having gained a spectacular 360% year to date at the close of trading on Wednesday. Modest revenue and earnings surprises weren't enough to sustain those lofty gains, so Roku's stock came crashing down.
Source Fool.com