Roku Stock Rises in Market Debut

Chelsea West
September 29, 2017

On Wednesday night, Roku priced its IPO at the top of the range it had originally specified, $12 to $14 per share, aiming to generate more than $200 million with the offering.

Roku Inc, which makes a video streaming device, raised about $219 million in an initial public offering at the high end of its price range.

All three offer streaming video boxes featuring the most popular apps, such as Netflix and Hulu, to the growing number of cord-cutters untethering themselves from cable television. The startup generated a net loss of $24.2 million on revenue of $199.7 million during the first six months of the year, according to the company's filing with the Securities and Exchange Commission.

Roku, however, has managed to deftly navigate the turbulent landscape, wisely branching out from the revenue from its streaming sticks and boxes-which is still three-quarters of total sales-into areas like advertising and licensing.

Roku users streamed more than 6.7 billion hours on the platform in the first six month of this year, the company said, up 62% from the same period in 2016.

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Roku is best know for selling cheap boxes that allow consumers to stream Netflix, YouTube and other streaming video services to their televisions. We have seen battles between the big tech companies limit consumer choice before; for years you couldn't stream Amazon Prime on Apple TV, for example, and just this week YouTube was suddenly pulled of Amazon's Echo Show.

Roku's edge, it seems, comes in form of its ability to offer everything and not step on any toes.

Smith noted that the other high-profile tech public offering of the year, Blue Apron, will soon be directly challenged by Amazon, which filed a trademark for its own meal kit service earlier this year.

Even though CEO Wood isn't anxious about his company's ability to compete, investors will have to decide if Roku's market share and option-oriented platform are enough to set the streaming device maker apart.

At $16.33, Roku had a market capitalization of $1.55 billion.

Other reports by TheSundaySentinel

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