• by Wayne Friedman , November 8, 2018

Although growing OTT platform Roku earned advertising revenues near $70 million in the third quarter -- double that of a year ago -- investors weren’t happy with the company’s recent financial results.

Early Thursday morning, stock trading showed the company’s stock down a massive 17% to $48.90. This followed a 12% drop in after-market trading on Wednesday, following the release of its quarterly financial data.

Overall third-quarter revenue at the company rose 39% to $173.4 million. Roku’s platform revenue was up 74% to $100.1 million); its set-top box player revenue grew 58% to $70.5 million.

Analysts' platform revenue expectations were higher -- an estimated $103 million.

Now, over two-thirds of Roku’s $100 million in “platform” revenue -- its OTT app-connected platform to TV sets and other devices  -- comes from video advertising.

For the most recent period, Roku showed a 67% increase in revenue from national TV brands, says Standard Media Index. SMI adds that media marketers were Roku’s biggest advertisers -- making up 19% of Roku’s ad revenue from national advertisers.·

Video ads make up 94% of Roku’s advertising revenue.

Net income posted an $11.7 million loss -- widening the year-ago third-quarter period, which was $7.9 million. For the next quarter, Roku is expecting anywhere between a $4 million loss and a $3 million profit. Additionally, Roku has reported an average revenue per user (ARPU) of $17.34 below analysts estimates of $17.44.

Roku has seen 43% growth in active accounts over a year ago -- to 23.8 million -- both from its set-top-box customers and its connected platform on smart TV devices. Expectation was that Roku accounts would grow to 23.1 million.

Year-to-date, Roku says, more than one in four smart TVs sold in the U.S. are Roku-enabled TV sets.

For the full year, Roku expects $722 million to $732 million in revenue -- higher than earlier estimates, which were $710 million to $730 million.