Roku is heading for IPO to reach out to the masses

  • For enhancing and reaching to the wider section of the audience, Roku has finally taken up the decision to go for the initial public offerings and raise some valuable money.

     In the urge to stay competitive and qualitative, the streaming television pioneer has filed the paperwork to raise around $125 million with an offering of the stock in Nasdaq exchange. In the earlier time, Roku was in the trend for “cutting the cord” and shutting the traditional cable television to raise the standard of the streaming shows online on the demand basis.

    According to Roku, its branded devices for clicking the company’s video streaming platform are sold in Canada, Mexico, US, France, and Britain. Well, Roku still doesn’t sell its models to the Australian market officially, though there can be some online resellers including the Australian eBay vendors who do provide the Roku models and the Roku models are also available on the wide basis.

    The treasure of content offerings from Roku platform include the different shows and subscriptions supported by the ads. Apart from the other streaming platforms, Roku users have ensured that they have no problem with the ads unless the content is free, giving a chance to the company to grow by ad revenue. Most of the Roku’s earning is from selling the streaming players, but the company is constantly bringing the money from the commissions and advertising from the subscriptions and the other transactions on the devices. For widening the audience, the company has said that it may cut down the prices on the players and then try out to increase the revenue from the advertising sales.    \

    But, to reach to a wider section of the audience, the company will require a strong punch for its quality rivals in the video streaming market including Google, Apple, and Amazon which renders the offer services and devices. In a  recent filing with the US Securities and Exchange Commission, Roku has cleared to be traded on Nasdaq under the symbol ROKU. There was not any share price in the paperwork, which indicated that the company would be going to raise the maximum of $125 million.

    At the end of the June this year, Roku achieved the target of 15.1 million active user accounts and the users of the service also streamed the Roku content more than 6.7 billion/ hr in the first six months of the whole year, according to the company in the filing.  According to the revenue report Roku, the company earned the revenue of $199.7 million in the first half of this year, which is a surprise increase of 23 percent from the similar period in 2016. Meanwhile, the company also faces net loss to $24.2 million at the end of the six months from June 30 from $33.2 million during the same period.

    In the regulatory filing, Roku has also listed a $100 million fundraising on Friday. But, this figure will likely to get change after the investment bankers put the demand for the initial public offering of the stock. The companies completed their IPOs in two to four months after filing and getting the approvals from the government regulators. Like all the other tech companies, Roku is still in the unprofitable situation. In the last year, the company lost nearly of $43 million on the $399 million in revenue.  

    As the strategy may require more money, the company is willing to go public now. Currently, there has about $70 million in cash.  Overall, this IPO filing can be a game changer for Roku in the market.


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