Stocks/Earnings

Roku Rises in Nasdaq Debut

Shares soar almost 68% at end of first day of trading (Updated) 9/28/2017 11:23 AM Eastern Last updated at 9/28/2017 7:45 PM
Roku CEO Anthony Wood

Shares in Roku rose were up 30% in late morning trading Thursday following the company’s debut on Nasdaq, where shares opened at $14.

RELATED: Roku Prices IPO at $14 Per Share

At last check, Roku shares were up $4.27 (30.50%), to $18.27 each.

Update: Roku shares closed Thursday up $9.50 (67.86%) to $23.50 each.

Anthony Wood, Roku’s founder and CEO, appeared on CNBC’s Squawk Box to discuss the IPO and the company’s ambitions.

“Our goal is to power every TV in the world,” he said. “We have 15 million active customers, so there’s a lot more to go.“

Though device sales currently represent the bulk of Roku’s revenues, those are merely the vehicle to how Roku acquires active accounts, Wood said, stressing that Roku’s business focused on selling adverting, and becoming a next-gen ad platform and content distribution platform that’s delivered at scale.

In addition to calling advertising the “bread and butter” of Roku’s business, he also pointed out that 80% of gross profit comes from Roku’s Platforms business, which includes the advertising component.

“As the world moves to streaming, that means all TV advertising is moving to streaming,” Wood said.

RELATED: Roku Launches its Own Free, Ad-Based Streaming Channel

Wood also downplayed the ongoing threat that Roku faces from deeper-pocked companies that include Google, Apple and Amazon.

“We have been competing with big companies for a long time, very successfully,” he said.

Roku, he said, hasn’t spent a lot of money on marketing. “We do it by winning customer reviews” with a “purpose-built operating system for TV….If you want to reach the OTT  audience at scale, you need to be on Roku.”

Back to the importance of advertising in Roku’s business, Wood said 40% of all content viewed on Roku’s platform has ads in them.

 

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