Is Roku Finally Ready for Prime Time?
Like much of the streaming sector, Roku (NASDAQ: ROKU) stock surged during the pandemic.
The company was a major beneficiary of the stay-at-home effects of the crisis. Its user base soared, along with streaming subscription signups and digital advertising on the platform. 2022 brought a cold dose of reality to the stock, and shares plunged as growth cooled and the company ramped up spending at precisely the wrong time.
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Since then, the stock has languished under $100 a share, but its fourth-quarter earnings report earlier in February showed perhaps the strongest sign of life yet since the pandemic.
Overall revenue jumped 22% to $1.2 billion, topping estimates at $1.15 billion. Platform revenue, which is made up primarily of advertising and subscription fees, jumped 25% to $1.04 billion, a strong indicator of momentum in the business.
The company also did a better job of monetizing its users as average revenue per user rose 4% to $41.49 in the quarter. Growing that figure will be key to its future success, since it's already signed up half of the broadband households in the United States.
On the bottom line, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) jumped 62% to $77.5 million. Looking ahead, Roku's guidance for 2025 called for revenue of $4.61 billion, up 12% from 2024, and it expects adjusted EBITDA of $350 million, up from $260 million in the quarter. It also said it expects positive operating income in 2026.
Turning the corner
Roku's value proposition has long confused some investors, but it's not as complicated as it seems.
It loses money selling its devices so it can make money through advertising and partner subscriptions that it sells on its platform. The company ultimately makes money on engagement, and in the fourth quarter, a number of initiatives it's long touted started to pay off.
One area it's capitalizing on is its home page. That might sound insignificant, but it's the gateway to TV for more than 125 million people, making it valuable space for advertising and anything Roku wants to promote. It added a new AI-powered content row on the top of the home screen to recommend content, and it's integrated sports content throughout the home page, helping to drive consumption of sports.
The Roku Channel is also experiencing strong growth with streaming hours up 82%. That's important because it gives the company a large set of advertising inventory that it wholly owns. The more Roku Channel consumption grows, the greater the company's ability to monetize it is. In the fourth quarter, it added a new partnership with the NBA G League and also launched integrated ad campaign with Coca-Cola and PepsiCo.
Finally, it added premium subscriptions for a number of services, including Max, allowing users to subscribe in the Roku app, driving strong growth in distribution revenue.
The company is expanding its retail partnerships as well. For example, it's partnered with Instacart to guide users to buy packaged food and beverages featured on ads through Instacart.
What's next for Roku
Roku still has a long growth runway in front of it, and a lot of opportunities to monetize it.
The company has the No. 1 streaming app in the U.S., Canada, and Mexico, and it's growing across Latin America as well. Management said it will stop reporting numbers on streaming households and hours each quarter, so investors will have to sharpen their focus on the financial numbers instead.
In addition, the headwinds across the streaming sector finally seem to be lifting as the long post-pandemic hangover fades.
After bemoaning headwinds in the media and entertainment (M&E) vertical in earlier quarters, the company has diversified its mix of advertisers to mitigate that risk, but it also said that M&E is healthier and expected to grow in 2025.
Overall, Roku is growing where it needs to grow, and many of its earlier challenges seem to have faded away. It's given investors an operating profit target, and it still has a large addressable market to penetrate.
If the company can maintain the momentum from the fourth quarter, 2025 could be a big year for the streaming distribution leader.
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Globe and Mail
an hour ago
- Globe and Mail
Roku Stock Is Beaten Down Now, but It Could 10X
It's been a frustrating past four years for patient Roku (NASDAQ: ROKU) shareholders. While the ticker's pullback from its pandemic-prompted 2021 peak wasn't exactly surprising (lots of stocks suffered a similar fate), what is surprising is that this one hasn't budged a bit since that slide. Shares of the company are still down more than 80% from their 2021 high despite continued growth during this time. Blame a lack of profitability, maybe. Just remain patient. Roku's day in the sun is coming. And it could be big once the ball finally gets rolling. What Roku actually is Roku is one of North America's favorite brands of streaming video players; it makes branded smart televisions as well. Indeed, industry researcher Pixalate reports that as of the fourth quarter of last year, Roku accounted for 39% of the United States' streaming device market, edging out Amazon, Apple, and Samsung. It's doing similarly well in Canada, and is absolutely crushing it in Mexico with control of 74% of the country's connected TV business. And the rest of the world? While it's got pockets of respectable presence elsewhere, let's just say that -- for the time being anyway -- Roku isn't exactly a force to be reckoned with ... yet. (More on this in a moment.) Roku's business, however, isn't quite what it seems to be on the surface. While it's clearly a key seller of streaming technology, devices themselves are only a means to an end that account for about 14% of the company's total revenue, and don't produce any actual profit. Rather, Roku's core business is monetizing its role as a middleman between streaming services and their subscribers. This revenue can come in the form of advertising one might see on the home screen or screen-saving "crawl" when using its hardware. The bulk of this business, however, is just a small recurring piece of streaming service providers' monthly fee charged to their subscribers. On the order of 90 million households streamed 35.8 billion hours' worth of digital video during the first quarter of this year. That's roughly 400 hours of TV per household, most of which subscribe to more than one streaming service. At least within the United States, The Motley Fool's own in-house research arm reports the typical household subscribes to about four such services. That being said, recognize that Roku isn't just a middleman. It also operates its own stand-alone ad-supported streaming service. It's no slouch either. Television-ratings agency Nielsen reports The Roku Channel delivers as much digital video to U.S. consumers as Paramount 's flagship streaming service Paramount+ does, and is nearing Amazon Prime's impressive domestic streaming reach. The bullish case This reach doesn't necessarily seem to be enough to catapult Roku shares 10 times above their present price -- especially without any actual profit production yet. After all, the streaming industry's growth is seemingly slowing, stymied by a very real "streaming fatigue" headwind. Branding and marketing consultancy Kantar, in fact, argues that paid streaming reached its domestic peak in the latter half of last year. The streaming business isn't as much peaking, however, as it's entering a period of refinement and evolution. At the same time as consumers are culling subscriptions they don't use all that often, they're optimizing their streaming spending. This includes more usage of ad-supported services, and in a growing number of cases, free-to-watch ad-supported services. The key nuance for interested investors to understand is that this evolution doesn't work against Roku -- the company is still a (very) necessary middleman, and still collects a bit of revenue simply for allowing consumers to access any given streaming service. Indeed, with The Roku Channel making inroads as a destination within the ad-supported/free-to-watch sliver of the streaming market, this company enjoys a slight competitive edge due to the industry's current evolution. The crux of the reason to wade into a stake in lethargic Roku stock, however, is rooted in its potential for growth in overseas markets. As was noted, this company isn't much of a player outside of North America. While Pixalate adds that Roku's share of the United Kingdom's streaming device market is a respectable 20%, its intended reach into Europe doesn't go any further than that. It's not exactly proliferating anywhere else on the planet, either. This isn't an indication of a lack of marketability, though. It's by design. See, Roku hasn't forced its way into markets much beyond U.S. borders largely because those markets weren't quite ready yet. The company also wanted to focus on North America at a time when that market was ready to explode. Now those other opportunities are finally opening up. And Roku is capitalizing. Last year, it partnered with established TV manufacturers to introduce Roku television sets in Brazil, Colombia, Chile, and Peru, plugging it into a South American free/ad-supported streaming video market that Omdia expects to swell from last year's $231 million to $569 million by 2029. Separately but simultaneously, Ampere Analysis predicts Latin America's entire video entertainment market will grow by $6 billion for the same time frame, with two-thirds of that growth driven by subscription-based streaming services that Roku's technology makes easy to access. For perspective, Roku did a little less than $4 billion worth of business last year. And once this South American opportunity starts cooling, don't be surprised to see the company then turn its attention to yet another pocket of opportunity. There's certainly going to be enough of it. Precedence Research predicts the worldwide direct streaming business is set to grow at an average annualized pace of 24% through 2034, led by the Asian-Pacific region. Far more potential than is being priced in It won't necessarily be easy for Roku to win a significant share of this growth. U.S. consumers and their nearby neighbors were receptive to the domestic company's brand name. That may not quite be the case in all overseas markets. Things could prove particularly challenging in and around China, especially if the tariff-fought trade war becomes the new norm. Roku is also going to bump into a saturation ceiling within the all-important U.S. market sooner or later, where average per-user revenue figures tend to be higher than anywhere else. On balance, however, not nearly enough of Roku's long-term potential upside -- and eventual profitability -- is reflected in the stock's present price. Even analysts may be underestimating the company's potential, with a one-year consensus price target of $86.25 that's only about 17% above the stock's current price. Don't be discouraged by that ho-hum target, though, or for that matter, by the stock's lethargic go-nowhere performance since tumbling in 2021 and 2022. Most everyone seems to be waiting for someone else to stick their neck out first, or perhaps waiting for clear hope of future profits. Just don't tarry if you're a believer. Once Roku shares finally start crawling out of its rut, the right-pricing rally could be a speedy one that doesn't offer many great entry opportunities. The hard part will be remaining patient enough in the meantime, for whenever that strength finally materializes. Should you invest $1,000 in Roku right now? Before you buy stock in Roku, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Roku wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $668,538!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $869,841!* Now, it's worth noting Stock Advisor 's total average return is789% — a market-crushing outperformance compared to172%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 2, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. 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Cision Canada
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SolarBank Renews At-The-Market Equity Program
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Prospective investors should read the Base Prospectus, the Prospectus Supplement and other documents the Company has filed with the SEC (some of which are incorporated by reference into the Base Prospectus and the Prospectus Supplement) for more complete information about the Company and the ATM Program, including the risks associated with investing in the Company. Copies of the Prospectus Supplement, Base Prospectus and Distribution Agreement are available under the Company's profile on SEDAR+ at and copies of the U.S. Prospectus Supplement and the Registration Statement are available on the SEC's website at Alternatively, the Agents will send copies of the relevant documents to investors upon request by contacting RCC by mail at Research Capital Corporation, 1075 West Georgia Street, Suite 1920, Vancouver, British Columbia V6E 3C9, by email at [email protected] or by telephone at (778) 373-4088. This news release does not constitute an offer to sell or the solicitation of an offer to buy securities, nor will there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. ABOUT SOLARBANK CORPORATION SolarBank Corporation is an independent renewable and clean energy project developer and owner focusing on distributed and community solar projects in Canada and the USA. The Company develops solar and Battery Energy Storage System (BESS) projects that sell electricity to utilities, commercial, industrial, municipal and residential off-takers. The Company maximizes returns via a diverse portfolio of projects across multiple leading North America markets including projects with utilities, host off-takers, community solar, and virtual net metering projects. 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Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as "will likely result", "are expected to", "expects", "will continue", "is anticipated", "anticipates", "believes", "estimated", "intends", "plans", "forecast", "projection", "strategy", "objective" and "outlook") are not historical facts and may be forward-looking statements and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in such forward-looking statements. 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Forward-looking statements are based on certain assumptions and analyses made by the Company in light of the experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate, and are subject to risks and uncertainties. In making the forward looking statements included in this news release, the Company has made various material assumptions, including but not limited to: obtaining the necessary regulatory approvals; that regulatory requirements will be maintained; general business and economic conditions; the Company's ability to successfully execute its plans and intentions; the availability of financing on reasonable terms; the Company's ability to attract and retain skilled staff; market competition; the products and services offered by the Company's competitors; that the Company's current good relationships with its service providers and other third parties will be maintained; and government subsidies and funding for renewable energy will continue as currently contemplated. 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National Post
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Americas net revenue increased 3%, or 4% on a constant dollar basis. International net revenue increased 19%, or 20% on a constant dollar basis. Comparable sales increased 1%. Americas comparable sales decreased 2%, or 1% on a constant dollar basis. International comparable sales increased 6%, or 7% on a constant dollar basis. Gross profit increased 8% to $1.4 billion and gross margin increased 60 basis points to 58.3%. Income from operations increased 1% to $438.6 million and operating margin decreased 110 basis points to 18.5%. The effective income tax rate for the first quarter of 2025 was 30.2% compared to 29.5% for the first quarter of 2024. Diluted earnings per share were $2.60 compared to $2.54 in the first quarter of 2024. The Company repurchased 1.4 million of its shares for a cost of $430.4 million. The Company added three net new company-operated stores during the first quarter, ending with 770 stores. 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Article content The guidance and outlook forward-looking statements made in this press release are based on management's expectations as of the date of this press release and do not incorporate future unknown impacts, including tariffs and macroeconomic trends. The Company undertakes no duty to update or to continue to provide information with respect to any forward-looking statements or risk factors, whether as a result of new information or future events or circumstances or otherwise. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of risks and uncertainties, including those stated below. Article content Conference Call Information Article content A conference call to discuss first quarter results is scheduled for today, June 5, 2025, at 4:30 p.m. Eastern time. Those interested in participating in the call are invited to dial 1-833-752-3550 or 1-647-846-8290, if calling internationally, approximately 10 minutes prior to the start of the call. A live webcast of the conference call will be available online at: A replay will be made available online approximately two hours following the live call for a period of 30 days. Article content About lululemon athletica inc. Article content lululemon athletica inc. (NASDAQ:LULU) is a technical athletic apparel, footwear, and accessories company for yoga, running, training, and most other activities, creating transformational products and experiences that build meaningful connections, unlocking greater possibility and wellbeing for all. Setting the bar in innovation of fabrics and functional designs, lululemon works with yogis and athletes in local communities around the world for continuous research and product feedback. For more information, visit Article content Shifted Calendar for Comparable Sales Article content Due to the 53rd week in 2024, comparable sales are calculated on a one week shifted basis such that the 13 weeks ended May 4, 2025 is compared to the 13 weeks ended May 5, 2024 rather than April 28, 2024. Article content Non-GAAP Financial Measures Article content We report certain financial metrics on a constant dollar basis, which is a non-GAAP financial measure. Article content A constant dollar basis assumes the average foreign currency exchange rates for the period remained constant with the average foreign currency exchange rates for the same period of the prior year. The Company provides constant dollar changes in its results to help investors understand the underlying growth rate of net revenue excluding the impact of changes in foreign currency exchange rates. Management uses constant currency metrics internally when reviewing and assessing financial performance. 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For more information on these non-GAAP financial measures, please see the section captioned 'Reconciliation of Non-GAAP Financial Measures' included in the accompanying financial tables, which includes more detail on the GAAP financial measure that is most directly comparable to each non-GAAP financial measure, and the related reconciliations between these financial measures. The Company's non-GAAP financial measures may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures reported by other companies. Article content Forward-Looking Statements: Article content This press release includes estimates, projections, statements relating to the Company's business plans, objectives, and expected operating results that are 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. In many cases, you can identify forward-looking statements by terms such as 'may,' 'will,' 'should,' 'expects,' 'plans,' 'anticipates,' 'outlook,' 'believes,' 'intends,' 'estimates,' 'predicts,' 'potential' or the negative of these terms or other comparable terminology. These forward-looking statements also include the Company's guidance and outlook statements. These statements are based on management's current expectations but they involve a number of risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in the forward-looking statements as a result of risks and uncertainties, which include, without limitation: the Company's ability to maintain the value and reputation of its brand; its highly competitive market and increasing competition; its ability to anticipate consumer preferences and successfully develop and introduce new, innovative and differentiated products; the acceptability of its products to guests; increasing costs and decreasing selling prices; its ability to accurately forecast guest demand for its products; its ability to expand in light of its limited operating experience and limited brand recognition in new international markets and new product categories; its ability to manage its growth and the increased complexity of its business effectively; changes in consumer shopping preferences and shifts in distribution channels; its leasing of retail and distribution space; its ability to attract, manage, and retain highly qualified individuals; seasonality; its ability to safeguard against security breaches with respect to its technology systems; its compliance with privacy and data protection laws; any material disruption of its information systems; its ability to have technology-based systems function effectively and grow its e-commerce business globally; disruptions of its supply chain; its reliance on a relatively small number of vendors to supply and manufacture a significant portion of its products; suppliers or manufacturers not complying with its Vendor Code of Ethics or applicable laws; fluctuating costs of raw materials; its ability to deliver its products to the market and to meet guest expectations if it has problems with its distribution system; increasing labor costs and other factors associated with the production of its products in South Asia and South East Asia; an economic recession, depression, or downturn or economic uncertainty in its key markets; global economic and political conditions; its ability to source and sell its merchandise profitably or at all if new trade restrictions are imposed or existing trade restrictions become more burdensome; changes in tax laws or unanticipated tax liabilities; its ability to comply with trade and other regulations; fluctuations in foreign currency exchange rates; global or regional health events such as the COVID-19 pandemic and related government, private sector, and individual consumer responsive actions; imitation by its competitors; its ability to protect its intellectual property rights; conflicting trademarks and patents and the prevention of sale of certain products; climate change and related pressures; heightened scrutiny and legal risks from competing pressures regarding ESG; its exposure to various types of litigation; and other risks and uncertainties set out in filings made from time to time with the United States Securities and Exchange Commission and available at Article content Article content , including, without limitation, its most recent reports on Form 10-K and Form 10-Q. You are urged to consider these factors carefully in evaluating the forward-looking statements contained herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. The forward-looking statements made herein speak only as of the date of this press release and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances, except as may be required by law. Article content lululemon athletica inc. The fiscal year ending February 1, 2026 is referred to as '2025' and the fiscal year ended February 2, 2025 is referred to as '2024'. Condensed Consolidated Statements of Operations Unaudited; Expressed in thousands, except per share amounts First Quarter 2025 2024 Net revenue $ 2,370,660 $ 2,208,891 Costs of goods sold 987,534 933,823 Gross profit 1,383,126 1,275,068 As a percentage of net revenue 58.3 % 57.7 % Selling, general and administrative expenses 942,871 842,426 As a percentage of net revenue 39.8 % 38.1 % Amortization of intangible assets 1,630 — Income from operations 438,625 432,642 As a percentage of net revenue 18.5 % 19.6 % Other income (expense), net 11,786 23,283 Income before income tax expense 450,411 455,925 Income tax expense 135,839 134,504 Net income $ 314,572 $ 321,421 Basic earnings per share $ 2.61 $ 2.55 Diluted earnings per share $ 2.60 $ 2.54 Basic weighted-average shares outstanding 120,632 125,989 Diluted weighted-average shares outstanding 120,843 126,336 Article content lululemon athletica inc. Condensed Consolidated Balance Sheets Unaudited; Expressed in thousands May 4, 2025 February 2, 2025 April 28, 2024 ASSETS Current assets Cash and cash equivalents $ 1,325,272 $ 1,984,336 $ 1,900,672 Inventories 1,652,091 1,442,081 1,345,267 Prepaid and receivable income taxes 230,280 182,253 192,955 Other current assets 374,874 371,632 329,193 Total current assets 3,582,517 3,980,302 3,768,087 Property and equipment, net 1,846,609 1,780,617 1,561,185 Right-of-use lease assets 1,549,401 1,416,256 1,263,749 Goodwill and intangible assets, net 178,001 171,191 23,992 Deferred income taxes and other non-current assets 274,015 254,926 211,482 Total assets $ 7,430,543 $ 7,603,292 $ 6,828,495 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 303,975 $ 271,406 $ 261,605 Accrued liabilities and other 506,996 559,463 374,446 Accrued compensation and related expenses 144,222 204,543 132,911 Current lease liabilities 281,837 275,154 254,443 Current income taxes payable 31,276 183,126 53,087 Unredeemed gift card liability 271,076 308,352 268,296 Other current liabilities 33,003 37,586 38,783 Total current liabilities 1,572,385 1,839,630 1,383,571 Non-current lease liabilities 1,424,945 1,300,637 1,147,631 Non-current income taxes payable — — 15,864 Deferred income tax liability 98,189 98,188 29,150 Other non-current liabilities 45,454 40,790 32,471 Stockholders' equity 4,289,570 4,324,047 4,219,808 Total liabilities and stockholders' equity $ 7,430,543 $ 7,603,292 $ 6,828,495 Article content lululemon athletica inc. Condensed Consolidated Statements of Cash Flows Unaudited; Expressed in thousands First Quarter 2025 2024 Cash flows from operating activities Net income $ 314,572 $ 321,421 Adjustments to reconcile net income to net cash provided by operating activities (433,526 ) (193,897 ) Net cash (used in) provided by operating activities (118,954 ) 127,524 Net cash used in investing activities (106,842 ) (131,537 ) Net cash used in financing activities (467,974 ) (328,628 ) Effect of foreign currency exchange rate changes on cash and cash equivalents 34,706 (10,658 ) Decrease in cash and cash equivalents (659,064 ) (343,299 ) Cash and cash equivalents, beginning of period 1,984,336 2,243,971 Cash and cash equivalents, end of period $ 1,325,272 $ 1,900,672 Article content lululemon athletica inc. Reconciliation of Non-GAAP Financial Measures Unaudited Constant dollar changes The below changes show the change compared to the corresponding period in the prior year. Due to the 53rd week in 2024, the below changes in comparable sales are calculated on a one week shifted basis such that the 13 weeks ended May 4, 2025 is compared to the 13 weeks ended May 5, 2024 rather than April 28, 2024. First Quarter 2025 Net Revenue Change Foreign exchange Change in constant dollars United States 2 % — % 2 % Canada 4 5 9 Mexico (1) n/a n/a n/a Americas 3 1 4 China Mainland 21 1 22 Rest of World 16 1 17 Total international 19 1 20 Total 7 % 1 % 8 % Article content First Quarter 2025 Comparable Sales (2) Change Foreign exchange Change in constant dollars Americas (2 )% 1 % (1 )% China Mainland 7 1 8 Rest of World 6 1 7 Total international 6 1 7 Total 1 % — % 1 % Article content ___________________ (1) On September 10, 2024, the Company acquired the lululemon branded retail locations and operations run by a third party in Mexico. Wholesale sales to the third party by lululemon athletica canada inc. prior to the acquisition are disclosed as net revenue recognized within Canada. (2) Comparable sales includes comparable company-operated store and e-commerce net revenue. Comparable company-operated stores have been open for at least 12 full fiscal months, or open for at least 12 full fiscal months after being significantly expanded. Comparable company-operated stores exclude stores which have been temporarily relocated for renovations or have been temporarily closed. Company-operated stores acquired as a result of the acquisition of the Mexico operations will be considered comparable beginning October 2025, after 12 full fiscal months of sales from the date of acquisition. Article content Total Gross Square Feet at the Beginning of the Quarter Gross Square Feet Added During the Quarter (2) Gross Square Feet Lost During the Quarter (2) Total Gross Square Feet at the End of the Quarter 2 nd Quarter 2024 2,988 90 3 3,075 3 rd Quarter 2024 3,075 156 — 3,231 4 th Quarter 2024 3,231 153 12 3,372 1 st Quarter 2025 3,372 50 7 3,415 Article content Article content Article content Article content Contacts Article content Investor Contacts: Article content lululemon athletica inc. Article content Article content Howard Tubin Article content Article content 1-604-732-6124 Article content Article content or Article content Article content ICR, Inc. Article content Article content Joseph Teklits Article content Article content 1-203-682-8200 Article content Article content Article content
