Roku Soars to All-Time High on Blockbuster Earnings – Yahoo Finance

(NASDAQ: ROKU) reported first-quarter earnings results yesterday, and the company’s platform business continues to put up strong growth. Other operating metrics also marched higher as Roku grows its audience and engagement remains robust. In fact, the business is doing so well that Roku raised its full-year forecast. Shares have jumped to all-time highs following the release.” data-reactid=”11″ type=”text”>Roku (NASDAQ: ROKU) reported first-quarter earnings results yesterday, and the company’s platform business continues to put up strong growth. Other operating metrics also marched higher as Roku grows its audience and engagement remains robust. In fact, the business is doing so well that Roku raised its full-year forecast. Shares have jumped to all-time highs following the release.

Roku results: The raw numbers

Metric

Q1 2019

Q1 2018

Year-Over-Year Change

Active accounts

29.1 million

20.8 million

40%

Streaming hours

8.9 billion

5.1 billion

74%

Average revenue per user (ARPU)

$19.06

$15.07

27%

Total revenue

$206.7 million

$136.6 million

51%

Gross profit

$100.9 million

$63.1 million

60%

Net loss

($9.7 million)

($6.6 million)

N/A

Data source: SEC filings.

Roku interface displayed on a TV

Third-party Roku TVs are helping to drive growth. Image source: Roku.

What happened with Roku this quarter?

expectations and its own guidance on a number of fronts, and made progress on many critical strategic imperatives that it has been pursuing.” data-reactid=”29″ type=”text”>Roku beat expectations and its own guidance on a number of fronts, and made progress on many critical strategic imperatives that it has been pursuing.

  • The company added 2 million active accounts during the quarter.
  • Roku expanded gross margin by 2.6 percentage points year over year, thanks to the ongoing shift to the highly profitable platform segment.
  • Monetized video ad impressions more than doubled year over year.
  • The company estimates that over a third of smart TVs sold in the U.S. in the first quarter were Roku TVs made by third-party manufacturers.
  • Player unit sales increased 21% year over year.
  • Player average selling prices (ASPs) declined 4% year over year due to aggressive pricing.
  • Platform revenue jumped 79% to $134.2 million.
  • Roku raised $98 million in net proceeds through an at-the-market secondary offering.
  • Adjusted EBITDA was $10 million.

What management had to say

the conference call. “New services and customer acquisition campaigns from Disney, Apple, and others will help fuel Roku’s growth for years to come.”” data-reactid=”41″ type=”text”>Disney and Apple are launching high-profile over-the-top (OTT) streaming services this year, and Roku is on board with both of the giant companies. “In recent weeks, some of the world’s largest media publishers have announced massive new investments in streaming,” CEO Anthony Wood said on the conference call. “New services and customer acquisition campaigns from Disney, Apple, and others will help fuel Roku’s growth for years to come.”

premium third-party subscriptions during the quarter, and has grown its stable of available channels to 30, including AT&T‘s HBO (which was not available initially at launch). CFO Steve Louden declined to elaborate on whether premium subscriptions were material in the quarter or give any specific figures regarding premium subscriptions, but did note that premium subscriptions may weigh on gross margin due to the way they are accounted for.” data-reactid=”42″ type=”text”>Roku launched premium third-party subscriptions during the quarter, and has grown its stable of available channels to 30, including AT&T‘s HBO (which was not available initially at launch). CFO Steve Louden declined to elaborate on whether premium subscriptions were material in the quarter or give any specific figures regarding premium subscriptions, but did note that premium subscriptions may weigh on gross margin due to the way they are accounted for.

“And then the other piece [regarding platform gross margin], which again is early days, but has a very different margin structure because it’s the premium subscription business because it’s handled on a gross basis and then the payment to the content provider is considered [cost of goods sold], that can have a potential effect as well,” Louden said.

Looking forward

Guidance for the second quarter calls for $220 million to $225 million in revenue, which should result in $98 million to $103 million in gross profit. The company expects adjusted EBITDA to be negative $5 million to negative $10 million, with a net loss of $25 million to $30 million.

over $1 billion, and the company is raising its outlook slightly. Roku now expects 2019 revenue to be $1.03 billion to $1.05 billion, up from the prior projection of $1 billion to $1.025 billion in sales. Gross profit for 2019 should be $465 million to $475 million, with adjusted EBITDA of $10 million to $20 million. Net loss for the year is expected to be $65 million to $75 million.” data-reactid=”46″ type=”text”>Last quarter, Roku had forecast full-year 2019 revenue of over $1 billion, and the company is raising its outlook slightly. Roku now expects 2019 revenue to be $1.03 billion to $1.05 billion, up from the prior projection of $1 billion to $1.025 billion in sales. Gross profit for 2019 should be $465 million to $475 million, with adjusted EBITDA of $10 million to $20 million. Net loss for the year is expected to be $65 million to $75 million.

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  • Evan Niu, CFA owns shares of AAPL and DIS. The Motley Fool owns shares of and recommends AAPL and DIS. The Motley Fool has the following options: short January 2020 $155 calls on AAPL and long January 2020 $150 calls on AAPL. The Motley Fool recommends Roku. The Motley Fool has a disclosure policy.” data-reactid=”55″ type=”text”>Evan Niu, CFA owns shares of AAPL and DIS. The Motley Fool owns shares of and recommends AAPL and DIS. The Motley Fool has the following options: short January 2020 $155 calls on AAPL and long January 2020 $150 calls on AAPL. The Motley Fool recommends Roku. The Motley Fool has a disclosure policy.

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    Jeff Bezos is about to speak publicly about Blue Origin, his secretive rocket company – CNN

    New York (CNN Business)Jeff Bezos may be ready to bring Blue Origin, his secretive space company, out of the shadows.

    The firm has spent two decades quietly designing and testing new rocket technologies that Bezos hopes will help usher in a science fiction future where millions of people live and work among the stars.
    The Amazon (AMZN) CEO and world’s wealthiest person recently described Blue Origin as the “most important work” he’s doing. But so far he’s mostly forgone flashy announcements, and instead has encouraged employees to adopt mantras like “slow is smooth, and smooth is fast.”
    Things are different this week. Blue Origin is hosting a rare event with media in Washington, DC, on Thursday. Bezos himself is scheduled to speak, but it’s not entirely clear what will be discussed.
    The invitations said that Bezos plans to give an update on Blue Origin’s “progress and share our vision of going to space to benefit Earth.” Spokespeople for Blue Origin declined to share further details.
    The only other clue is a cryptic tweet that includes the date of the event along with a photo of “Endurance,” the ill-fated ship that left explorer Ernest Shackleton and his crew stranded during an expedition to Antarctica in 1915. (A crater on the moon’s south pole is also named for Shackleton, a hint that Bezos’ speech could have a lunar focus.)
    There are a few reasons Blue Origin may be hankering for media attention: Executives have said Blue Origin’s space tourism business will be up and running this year; its massive New Glenn rocket could ready to fly in 2021; and Bezos has been more open in recent months about plans to ferry cargo to the moon and set up a base on its surface.

    The billionaire space race

    Bezos isn’t the only billionaire with a space company. Elon Musk and Richard Branson started their own businesses in the early 2000s, too. The men have been credited with helping to usher in a new era of spaceflight by pouring money into projects once considered too risky or expensive for the private sector.
    Elon Musk’s rocket company SpaceX has enjoyed the lion’s share of media attention. It’s led the charge by developing cheap reusable rockets that now regularly haul satellites to orbit. The company also wins high-profile contracts with NASA and the military, and it’s touted bold plans for colonizing Mars.
    British serial entrepreneur Richard Branson has also wielded his signature showmanship to promote Virgin Galactic, a space tourism venture that hundreds of customers have already lined up for. It could open for business this year.
    Branson has also publicized longer-term goals like offering rocket-powered flights between cities.
    Blue Origin may have kept the lowest profile. But its plans are no less ambitious.
    The startup has launched nearly a dozen demo flights of its New Shepard rocket, which is designed to send tourists on scenic trips to the thermosphere. Its first crewed launch could be just a few months away, an executive said during a test launch webcast last week.
    And then there’s New Glenn, which competes for lucrative satellite launch contracts and could start flying in a couple of years.
    Bezos’ enormous e-commerce fortune could give Blue Origin a leg up in the billionaire space race. Bezos has said he fills Blue Origin’s coffers by selling about $1 billion worth of his Amazon stock each year. The company hasn’t worried about courting investors.
    SpaceX has padded Musk’s early investments by raising huge amounts of venture capital dollars and landing big launch contracts. It’s worth an estimated $30 billion. But if investors get nervous about SpaceX’s expensive gambles on new technologies or the economy goes south, things could get rocky.
    Branson’s space company, meanwhile, has been hungry for cash since it turned down a $1 billion investment from Saudi Arabia last year after journalist Jamal Khashoggi was killed at a Saudi consulate. Virgin has since hired a finance firm to help find new backers, Sky News reported in February.

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    Siemens Will Exit Power, Gas, Renewable Businesses – POWER magazine

    05/07/2019 | Sonal Patel and Darrell Proctor

    Siemens will spin off and give up its majority stake in its lucrative Gas and Power division—comprising its conventional power generation, power transmission, oil and gas, and related services businesses—and transfer its current majority 59% stake in Siemens Gamesa Renewable Energy (SGRE) to the new business.

    The company’s supervisory board announced the spinoff on May 7 as part of its Vision 2020+ strategy concept. The board said the move would help Germany-based Siemens meet medium-term growth and profit targets by “clearly focusing its portfolio on dynamic growth markets and efficiency gains.”

    The Gas and Power spinoff and transfer of SGRE stake would create a new “major player on the energy market” with a business volume of €30 billion and over 80,000 employees, Siemens said. The carveout will give the new company “complete independence and entrepreneurial freedom,” it said. Siemens said the new company will have a stock exchange listing by September 2020.

    The move will create a “powerful pure play in the energy and electricity sector with a unique, integrated setup – an enterprise that encompasses the entire scope of the energy market like no other company,” explained Joe Kaeser, president and CEO of Siemens AG. “Combining our portfolio for conventional power generation with power supply from renewable energies will enable us to fully meet customer demand. It will also allow us to provide an optimized and, when necessary, combined range of offerings from a single source.”

    The news is a stunning move for a company that has been a crucial player in the power sector since its inception 150 years ago. The decision about the spinoff and public listing still need to be cemented, likely at a special shareholder’s meeting in June 2020.

    While Siemens will give up its majority stake in Gas and Power, it also said it would remain a “strong anchor shareholder in the new company, with a stake that is to be initially somewhat less than 50% and, for the foreseeable future, above the level of a blocking minority holding,” it said. Siemens also plans to support the new company through its professional financial services and its regional sales networks, as well as through “the licensing of the powerful Siemens brand.”

    The spinoff will put Siemens’ Digital Industries (DI) and Smart Infrastructure (SI) divisions as its core. “This core will be supplemented by company-wide technology and service units and the company’s strategic majority stake in Siemens Healthineers. Siemens Mobility is also to be further strengthened as a growth business,” the company said.

    According to Kaeser, Siemens is convinced that the strategic spinoff decision “will be positive for all participants and enable long-term value creation for customers, employees and shareholders.” The company also plans to “jointly pursue” recent market successes, such as its significant $15 billion deal in Iraq.

    Lisa Davis, who heads Siemens’ Gas and Power division, said in a statement that independence of the new company—which she will lead until October 2021—would help it “more effectively leverage our position of strength to further support our customers in rapidly changing energy markets.”

    Davis noted the “freedom and agility” to concentrate on “highly specific and quickly changing requirements” of changing markets and customers was becoming especially important. “In addition, we’ll be able to more directly control our costs and ensure that our stakeholders benefit directly from every euro we spend,” she said.

    Siemens and other power sector giants, including General Electric (GE) and Mitsubishi Hitachi Power Systems (MHPS), have struggled in recent years with sagging demand for gas turbines, which have been a core part of their business. Growth in renewable energy has led to declining revenue for the companies, resulting in thousands of layoffsGE cut 12,000 jobs in its Power division—and also talk of consolidation.

    GE’s cuts announced in 2017 came just weeks after Siemens said it would cut 6,900 jobs, mostly in its power and gas sector.

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