Ark Invest Stock Portfolio: Top 10 Stocks to Buy

2. Roku, Inc. (NASDAQ:ROKU)

Number of Hedge Fund Holders as of Q4: 37

Ark Invest’s Equity Stake: $793.35 Million 

Roku, Inc. (NASDAQ:ROKU) exceeded expectations in Q4 2024, reporting a 22% revenue increase and a significantly reduced net loss. The company ended the year with 89.8 million streaming households, marking a 12% year-over-year increase and a gain of 4.3 million from the prior quarter. However, Roku announced that it will no longer report household metrics on a quarterly basis, shifting focus toward revenue and profitability. The company posted Q4 revenue of $1.201 billion and a net loss of $35.5 million, or -$0.24 per share, compared to analysts’ expectations of $1.15 billion in revenue and an EPS of -$0.43. Operating expenses saw only a slight increase of 2%, totaling $551.7 million. Roku, Inc. (NASDAQ:ROKU) highlighted its expanding U.S. presence, with its platform now reaching over half of broadband households.

Roku’s Platform business, which includes advertising, content sales, and subscription revenue sharing, contributed $1.04 billion to Q4 revenue. Political ad spending accounted for about 6% of this total, while advertising sales outpaced overall platform revenue growth, surpassing both the broader ad market and the OTT ad sector in the U.S. Roku, Inc. (NASDAQ:ROKU) reported a strong gross margin of 54% for Q4, exceeding its own forecasts due to a favorable shift in revenue mix. For the full year 2024, Roku’s overall gross margin stood at 53.5%. This performance underscores the company’s ability to drive profitability in its core business segments while maintaining steady revenue growth.

Roku, Inc. (NASDAQ:ROKU) anticipates achieving operating income profitability for the full year 2026. For Q1 2025, the company projects total net revenue of $1 billion, a 14% increase year-over-year. Roku expects total gross profit of $450 million, adjusted EBITDA of $55 million, and a net loss of $40 million. For the full year 2025, the company forecasts net revenue of $4.61 billion, total gross profit of $2 billion, and adjusted EBITDA of $350 million. With strong growth projections and a path to profitability, Roku remains one of the top stocks to buy.