Winners And Losers Of Q2: Roku (NASDAQ:ROKU) Vs The Rest Of The Consumer Subscription Stocks
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how consumer subscription stocks fared in Q2, starting with Roku (NASDAQ:ROKU).
Consumers today expect goods and services to be hyper-personalized and on demand. Whether it be what music they listen to, what movie they watch, or even finding a date, online consumer businesses are expected to delight their customers with simple user interfaces that magically fulfill demand. Subscription models have further increased usage and stickiness of many online consumer services.
The 8 consumer subscription stocks we track reported a weaker Q2. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 2.9% below.
Stocks--especially those trading at higher multiples--had a strong end of 2023, but this year has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts. However, consumer subscription stocks have held steady amidst all this with average share prices relatively unchanged since the latest earnings results.
Roku (NASDAQ:ROKU)
Spun out from Netflix, Roku (NASDAQ: ROKU) makes hardware players that offer access to various online streaming TV services.
Roku reported revenues of $968.2 million, up 14.3% year on year. This print exceeded analysts’ expectations by 3.2%. Overall, it was a decent quarter for the company with solid growth in its users but slow revenue growth.
Interestingly, the stock is up 25.7% since reporting and currently trades at $69.49.
Is now the time to buy Roku? Access our full analysis of the earnings results here, it’s free.
Best Q2: Duolingo (NASDAQ:DUOL)
Founded by a Carnegie Mellon computer science professor and his Ph.D. student, Duolingo (NASDAQ:DUOL) is a mobile app helping people learn new languages.
Duolingo reported revenues of $178.3 million, up 40.6% year on year, in line with analysts’ expectations. It was a strong quarter for the company with impressive growth in its users and exceptional revenue growth.
Duolingo achieved the fastest revenue growth and highest full-year guidance raise among its peers. The company reported 103.6 million users, up 39.8% year on year. The market seems happy with the results as the stock is up 31.4% since reporting. It currently trades at $212.57.
Is now the time to buy Duolingo? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Chegg (NYSE:CHGG)
Started as a physical textbook rental service, Chegg (NYSE:CHGG) is now a digital platform addressing student pain points by providing study and academic assistance.
Chegg reported revenues of $163.1 million, down 10.8% year on year, exceeding analysts’ expectations by 2%. It was a weak quarter for the company with a decline in its users and slow revenue growth.
Chegg had the slowest revenue growth in the group. The company reported 4.37 million users, down 9.1% year on year. As expected, the stock is down 24.5% since the results and currently trades at $2.22.
Read our full analysis of Chegg’s results here.
Netflix (NASDAQ:NFLX)
Launched by Reed Hastings as a DVD mail rental company until its famous pivot to streaming in 2007, Netflix (NASDAQ: NFLX) is a pioneering streaming content platform.
Netflix reported revenues of $9.56 billion, up 16.8% year on year, in line with analysts’ expectations. More broadly, it was a weaker quarter for the company with underwhelming revenue guidance for the next quarter and slow revenue growth.
The company reported 277.6 million users, up 16.5% year on year. The stock is up 7% since reporting and currently trades at $687.99.
Read our full, actionable report on Netflix here, it’s free.
Coursera (NYSE:COUR)
Founded by two Stanford University computer science professors, Coursera (NYSE:COUR) is an online learning platform that offers courses, specializations, and degrees from top universities and organizations around the world.
Coursera reported revenues of $170.3 million, up 10.8% year on year, surpassing analysts’ expectations by 3.5%. Taking a step back, it was a mixed quarter for the company with strong growth in its users but slow revenue growth.
Coursera scored the biggest analyst estimates beat among its peers. The company reported 155 million users, up 20.2% year on year. The stock is up 14.1% since reporting and currently trades at $8.44.
Read our full, actionable report on Coursera here, it’s free.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.
