Roku Shares Climb. Is It Too Late to Buy the Stock?

Core Insights - Roku's shares surged following strong Q4 results and positive guidance, indicating robust performance in its primary business segments [1] Financial Performance - Q4 revenue increased by 16% year-over-year to $1.39 billion, with earnings per share (EPS) at $0.53, a significant improvement from a loss of $0.24 a year ago, surpassing analyst expectations of $0.28 EPS on $1.35 billion revenue [2] - Platform revenue rose by 18% to $1.22 billion, driven by video advertising and premium subscriptions, marking the best quarter for premium subscriptions, aided by HBO Max's addition [3] - Device revenue saw a modest increase of 3% to $170.9 million, but the device segment reported a gross loss of $33.9 million [3][6] - Adjusted EBITDA more than doubled year-over-year to $169.4 million, exceeding guidance of $145 million, while stock-based compensation totaled $85 million for the quarter [4] Future Projections - For 2026, Roku projects revenue to reach approximately $5.5 billion, with platform revenue expected to grow by 18% to $4.89 billion, alongside adjusted EBITDA of around $635 million and net income of $325 million [7] - For Q1, Roku anticipates revenue of $1.2 billion, reflecting an 18% year-over-year increase, with adjusted EBITDA projected at $130 million and net income at $50 million, while platform revenue is expected to climb by 21% [9]