Why Was Roku Stock Down on Monday?

Roku Stock

Roku (NASDAQ:ROKU) owners lost ground to the market early Monday, as Roku Stock (NASDAQ:ROKU) fell 3% at 11:15 a.m. ET, compared to the S&P 500’s 0.7% loss. This loss extended the streaming video platform’s lengthy run of losses, which dropped more than 75% in 2022.

It happened as investors were concerned about possible negative news in the streaming business.

Market Analysis of Roku Stock

In just a few days, on Oct. 18, Netflix is ready to release its third-quarter earnings. That study poses a few concerns for Roku stock (NASDAQ:ROKU), the most significant of which is the possibility that the streaming video leader would offer a gloomy short-term forecast. Netflix Co-CEO Reed Hastings and his team forecasted in July that Netflix would resume customer growth in the current quarter. However, inflation further strained consumers’ budgets throughout the decade.

Roku is also aggressively entering the advertising market, and its unique worldwide user base may entice a few large advertisers away from Roku. We’ll receive a vital update on that strategic effort during Netflix’s earnings call. These issues, and fears about slowing growth and net losses, have weighed on the stock.

So, What Now?

Investors will not have to wait long for further information about the company. Following Netflix’s earnings report in mid-October, Roku will likely release its own numbers in early November. This report will reveal if management was successful in halting the company’s path to losses in 2022. Netflix looks to be on a more stable path to consistent profit growth, and it is now producing positive yearly cash flows, which could increase in the coming years.

If the streaming video company can make comparable strides, Roku stock (NASDAQ:ROKU) will almost certainly regain some of its lost territories. However, for the time being, most investors are concerned that operational trends will deteriorate before improving.

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About the author: Okoro Chinedu is a freelance writer specializing in health and finance, with a keen interest in cryptocurrency and blockchain technology. He has worked in content creation and digital journalism. Since 2019, he has written on various online platforms, and his work has been recognized by several important media sources and specialists in finance and crypto. In addition to writing, Chinedu enjoys reading, playing football, posing as a medical student, and traveling.