Despite a rather strong fourth-quarter earnings report, Roku’s stock price was sent reeling anew two weeks ago when Walmart agreed to pay $2.3 billion to acquire smart TV company Vizio.
Speaking at a KeyBanc investor event Wednesday, new Roku CFO Dan Jedda sought to downplay the impact of that M&A event. (You can hear the whole speaking engagement here.)
“This was not a surprise to us at all. We were very prepared,” Jedda said. “First of all, we are widely distributed — we have distribution everywhere and distribution is growing. And the one thing about Roku is our streamers love our brand; they asked for us by name."
He added: “We will continue to work with Walmart. We have a great relationship with them and they’ll continue to sell Roku TVs. If anything, I think it opens up other distribution opportunities … other distributions came proactively to talk to us once that deal was announced.”
Appearing alongside Jedda, Conrad Grodd, Roku's investor relations chief, conceded that Roku’s days of powering Walmart’s house “onn” brand are probably over. Notably, however, Walmart is now selling Roku’s own branded smart TVs.
“Our first-party TV is doing very well,” he said. “It was exclusive to Best Buy in 2023. That was always just the launch plan."
However, Roku TVs have expanded to Amazon, where reviews have been solid. “We’re also in Costco, and we’re actually on walmart.com, doing very well with our first-party TVs. And so distribution is not going to be a problem for us. Again, we’re at 80 million [active users]. We’ll continue to grow. And we’ll do it in a variety of retailers out there, including Walmart, they’ll continue to work with us.”
Roku’s stock price is down about a third since news of Walmart’s serious interest in Vizio broke back in mid-February.
The reason isn’t just tied to Walmart and Vizio, analysts say.
“The stock has doubled since last quarter on vapor and these results were broadly in line,” equity analyst Michael Nathanson told Next TV last month when we asked the reason for the bearishness.
