Roku nears 40M users as it braces for COVID-19 impact

Roku
Roku said it ended the first quarter with an estimated $587 million of cash, cash equivalents, restricted cash and short-term investments, including a $70 million draw-down from its revolving credit facility. (Roku)

Ahead of its next quarterly earnings report in May, Roku is giving investors an update (including new user totals) amid the ongoing coronavirus outbreak.

The company, which is withdrawing its 2020 financial guidance, said that it now has 39.8 million active accounts as of March 31, which is a net increase of nearly 3 million since the beginning of the year. Roku also said it expects first quarter streaming hours will total 13.2 billion, up 49% year over year.

However, the company said the recent rollout of its “Are you still watching” feature, which exits video playback after long periods of user inactivity, could moderate streaming hour growth. Still, the effects of large numbers of people sheltering at home has resulted in an acceleration in new account growth and an increase in viewing for Roku.

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“Consumers are turning to Roku now more than ever. As the leading TV streaming platform in the U.S., Roku is proud to provide easy access to live news, free movies and TV, great paid content, and helpful programming for individuals and families who are sheltering at home,” said Roku CEO Anthony Wood in a statement. “We have been working closely with advertisers to help update their plans to reflect new viewing patterns and adjust their overall marketing mix which has been affected by social distancing. While we expect some marketers to pause or reduce ad investments in the near term, we believe that the targeted and measurable TV ads and unique sponsorship capabilities that Roku offers are highly beneficial to brands today.”

Roku CFO Steve Louden said that his company’s offerings to consumers, content providers and advertisers should allow Roku to be successful during the coronavirus outbreak but that the company is still withdrawing its guidance due to the uncertainty regarding overall impact and duration of the pandemic.

Roku said it ended the first quarter with an estimated $587 million of cash, cash equivalents, restricted cash and short-term investments, including a $70 million draw-down from its revolving credit facility.

“We decided it was prudent to draw down our credit facility in light of current financial market conditions," said Louden in a statement.

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