(Reuters) – Roku Inc said it expects 2020 ad sales to grow at a slower pace and recorded higher cancellations in the first quarter as advertisers save cash amid the COVID-19 pandemic, sending its shares down 10% in extended trading on Thursday.
FILE PHOTO A video sign displays the logo for Roku Inc, a Fox-backed video streaming firm, in Times Square after the company’s IPO at the Nasdaq Market in New York, U.S., September 28, 2017. REUTERS/Brendan McDermid
The ad crunch comes at a time when the video streaming device maker is trying to shift focus from device sales to advertising as more streaming services enter the market.
Roku puts advertisements on its free Roku Channel and also charges a commission from media companies that stream programming on the free, ad-supported channel.
“The main driver now is that advertising spend has dried up even on a market share leading platform