Why Roku Stock Climbed 11% in January

Shares of Roku (NASDAQ: ROKU) stock climbed 11% in January according to data provided by S&P Global Market Intelligence. There was no big news during the month, but investors are feeling more confident about the economy since President Donald Trump took office, and Netflix's excellent quarter might have the market feeling good about Roku, too.There doesn't seem to be anything wrong with Roku, except that it's still fighting its way toward profits. Whenever a company gets big and still can't turn a profit, that could be worrisome. But there are indications that Roku still has plenty of growth potential, and it's moving toward positive net income.Roku continues to report double-digit revenue growth on a fairly consistent basis. It was up 16% year over year in the 2024 third quarter. It has two segments: device and platform. Shoppers know it for its devices, which are the infrastructure that gets users into its ecosystem. It has the top operating system in the U.S., Canada, and Mexico, and when users buy a device, they create an account to access their streaming subscriptions. The platform segment is the much larger one, accounting for 85% of total sales in the third quarter. It's mostly ad revenue from its free, ad-supported channels, and also other third-party fee revenue from subscriptions signed up through Roku's platform and similar arrangements. The device segment is a money-loser right now, but it's the gateway to the larger business; platform gross profit increased 30% year over year in the third quarter, and so did total gross profit.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool