Roku prices IPO at $14 per share, valuing company at $1.3B

Roku Roku TV IPO

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The company priced its 18 million share offering at $14 per share on Thursday, the highend of the expected range of between $12 per share and $14 per share. Roku is averaging $11.22 in annual revenue per user, which is also up 35 percent year-over-year.

Roku Inc. shares jumped more than 65% Thursday on their first day of trade after the company's initial public offering, adding to an initial $1.3 billion valuation.

All three offer streaming video boxes featuring the most popular apps, such as Netflix and Hulu, to the growing number of cord-cutters untethering themselves from cable television.

But the Los Gatos, Calif., company also saw more red ink spill during the year as its net loss widened to $42.8 million, compared with $40.6 million in 2015, as it ramped up spending across the company.

Roku users during the first half of 2017, streamed over 6.7 billion hours on its platform, the company announced.

Since launching its first device in 2008, Roku has become a market leader for devices that help people stream content directly through their TV sets.

The cash Roku raised today will be used to compete against a host of tech giants. That gives its users more choices for apps rather than being force fed Apple, Amazon or Google content.

Even though CEO Wood isn't anxious about his company's ability to compete, investors will have to decide if Roku's market share and option-oriented platform are enough to set the streaming device maker apart.

Roku is best know for selling affordable boxes that allow consumers to stream Netflix, YouTube and other streaming video services to their televisions.

Roku addressed the crowded streaming market in their prospectus as well, recognizing it as a risk and saying that "These companies have the financial resources to subsidize the cost of their streaming devices in order to promote their...products and services making it harder for us to acquire new users and increase hours streamed". Roku's offering, on the other hand, plays nice with whatever service you want to watch.

This places a value on Roku of $1.3 billion.

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