2024 may have been another big year for stocks, but not every company made investors money. Here’s one industry-leading stock that’s down 11% in the last year.
Despite the stock price signal, the company continues to post solid double-digit revenue growth. Perhaps the market will have a more favorable view as we look ahead.
Could this be beaten? growth stocks Will we see a sharp rise in 2025?
Investors should take note Roku (NASDAQ: Roku)is the leading smart TV platform with a current customer base of 85.5 million households. This figure represents a 13% increase year-over-year, which led to a 16% increase in revenue for the third quarter of 2024 (ending September 30), reaching nearly $1.1 billion.
That growth trajectory is certainly impressive. It shows how well positioned Roku is. Businesses benefit directly from two powerful benefits: secular trend It is shaping our economy.
The first is the rise of streaming entertainment. Lured by lower prices, more choices, and an overall better user experience, people are ditching their cable TV packages and signing up for streaming subscriptions. Roku provides a platform where users can easily access all their content in one place. If this trend continues, you will likely see more customers engaging with your business.
Digital advertising is another tailwind propelling Roku. In November 2024, streaming accounted for 41.6% of total daily TV viewing time in the United States, and this percentage has been steadily increasing. Advertisers want to follow eye lines, so there is meaningful potential for Roku to capture this spend.
As just mentioned, streaming video entertainment is a powerful and profitable secular trend. So it’s no surprise that the industry is very competitive for both content companies and distributors. In typical fashion, the market has attracted tech heavyweights looking to get a piece of the pie.
alphabet, Amazonand apologizeThe dominant company serving billions of customers is Roku’s direct competitor. All three companies not only have their own streaming subscription services, but also provide distribution platforms.
Roku’s platform segment, which houses advertising operations (including revenue from distribution and licensing deals), reported revenue of $908 million for the three months ended Sept. 30. This is a decrease compared to overall revenue. During the third quarter, advertising revenue from Alphabet, Apple, and Amazon amounted to approximately $80 billion.
Despite the tech giants having top-tier technology and unlimited financial resources in digital advertising, it’s worth noting that Roku holds the highest market share among smart TV operating systems in the United States, Canada, and Mexico. Clearly, it was a success in the face of powerful enemies.
