Roku gains as much as 65% in trading debut after IPO

Roku gains as much as 65% in trading debut after IPO

Roku Inc, which makes a video streaming device, raised about $219 million in an initial public offering at the high end of its price range.

Roku is also the latest tech company to go public in what's been a largely lackluster year for tech initial public offerings.

Roku has also been expanding its advertising business. One can point to its wide selection of TV apps available on its devices for this growth-it has over 3,000 channels-with top choices available like Netflix, Amazon Prime Video, Hulu, HBONow (TWX - Free Report) and Starz. Apple, Amazon, and Google are all selling streaming hardware, and both Amazon and Google have partnered with TV makers to get their software operating systems on brand-new sets.

"In order to materially increase the monetization of our platform through the sale of advertising-supported video, we will need our users to stream significantly more ad-supported content", the company warned in its filing.

More news: A Major US Airline Is About To Offer Free In-Flight Texting

Roku is in the cord-cutting business.

The 32.6% market share for Roku of America's connected TV users that exceeded 150 million was head of Chromecast of Google at 29.9%, Amazon Fire TV at 26.2%, and Apple TV at 19.8%.

Snap was the biggest technology company to go public this year, but since its much-hyped IPO, its stock value has been cut nearly in half as investors saw how easily Facebook (FB - Free Report) 's Instagram could simply copy Snapchat's most popular features. Although it lacks the deep pockets of competitors such as Apple and Amazon, Roku has received financial backing from a bevy of media conglomerates including 21st Century Fox, Viacom and the Britain's Sky.

Roku is actually losing money on its hardware even though it generates such a large percentage of the company's revenue. It generated revenue of $199.7 million in the first six months of 2017, up 23% from $162.3 million in the same six months of 2016. Blue Apron shares have slumped almost 40% since it went public in June.

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