Disney Earnings, Roku Earnings
Hello everyone. Given Apple’s event on Monday (1 pm ET / 10 am PT), the next update will go out on Tuesday.
As you watch the event, if you have questions or observations that you would like addressed in the daily updates, send them my way. This includes any specific questions regarding the products themselves as there will be some demo time on Monday.
Today’s update will have a video streaming theme as we circle back to cover a few remaining CY2Q24 earnings releases from last month. For both Disney and Roku, the discussion will extend a bit beyond just what was found in their respective earnings.
Let’s jump in.
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Walmart Buys Vizio, Walmart vs. Amazon, Revisiting the Roku Story
We go over my thoughts on Walmart buying Vizio. The discussion includes a closer look at the Walmart vs. Amazon competitive battle. We also revisit Roku’s strategy and the massive holes in the company’s story.
An Above Avalon membership is required to read this update. Members can read the full update here. (Members: Daily Updates are accessible via the archive. If you haven’t logged into the archive before, fill out this form to receive an invite.)
Payment is hosted by MoonClerk and secured by Stripe. Apple Pay and other mobile payment options are accepted. After signup, use this link to update your payment information and membership status at any time.
An audio version of this update is available to members who have the podcast add-on attached to their membership. More information about the podcast add-on is found here. Special Inside Orchard bundle pricing is available for Above Avalon members. Additional membership customization is available via the Financial Models add-on.
Number of ATMs Decline, Apple Pay’s Long Game, Roku 4Q22 Earnings (Daily Update)
Hello everyone. Today’s update (Tuesday, March 7th) kicks off with Neil’s thoughts on the number of ATMs declining in the U.S. The discussion goes over cash usage trends and includes some of Neil’s personal observations and behavior change regarding cash use. There are takeaways involving Apple Pay and long-term payment trends. The update concludes with a look at Roku’s 4Q22 earnings.
Number of ATMs Decline
With an article that grabbed my interest yesterday, here is the WSJ:
“The slow move toward a cashless society is helping to send the ubiquitous ATM into decline around the U.S., presenting challenges for those who still largely rely on cash.
After peaking at 470,000 ATMs in the U.S. in 2019, the number of machines has declined annually over the past few years to 451,500 at the end of 2022, according to data tracked by research firm Euromonitor International. The reason: Many people quit using cash during the pandemic and haven’t gone back, said Kendrick Sands, consumer finance research manager for the London-based firm.
‘There was that scare that the virus was transmitted by paper, plus the trend of just buying everything online,’ said Mr. Sands, who is based in Chicago. ‘That dealt almost a death blow to cash, especially for younger people.’
Cash and checks are forecast to fall to 14% of total payments this year from 42% in 2010, with the most precipitous drop coming just after the pandemic started in 2020, according to Euromonitor estimates.”
In what was news to me, the number of ATMs in use is something that firms need to estimate and project. While the Federal Reserve publishes various statistics and data points regarding currency use, there does not appear to be a central database for the number of ATMs in use.
Accordingly, it shouldn’t have been much surprise that the ATM trade association is questioning Euromonitor International’s figures showing a decline in both the number of ATMs and cash usage saying that cash “is still the payment method of choice for in-person transactions of $25 or less.” That statement doesn’t take anything away from the assertions found in the WSJ’s article.
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Roku 3Q22 Earnings, Peloton 1Q23 Earnings (Daily Update)
Hello everyone. In today's update, we will focus on earnings from two of the smaller companies playing in the tech arena (Roku and Peloton). While Roku is an Apple competitor, Peloton remains a good source for assessing how consumers are thinking about different forms of connected fitness.
Let's jump right in.
Roku 3Q22 Earnings
Roku reported earnings back on November 2nd.
With macro issues taking a big toll on Roku's advertising business, the company's user growth and engagement appear to be rare bright spots. We say “appear” as it’s difficult to get comfortable regarding how streaming companies define and measure engagement. According to Roku, an active account is anyone who has streamed something in the past 30 days. It's easy to see how that definition offers quite a bit of wiggle room for volatility.
As shown below, Roku has seen a small rebound in new user growth (on a TTM basis).
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