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Gadget maker Roku's stock soars after IPO raises $219M

Gadget maker Roku's stock soars after IPO raises $219M

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.

Apple shares were down 0.3%, trading near 153.70 during morning trading in the stock market today.

Roku's S-1 filing revealed growing revenues, as well as a shift towards advertising-based income streams.

The company is unprofitable and has amassed $244 million in losses since it was founded in 2002. Roku competes with Apple TV, Chromecast and a number of other devices. A cut of subscription revenue from the apps featured on Roku's platform also provides a sizable share of business.

Roku, however, has managed to deftly navigate the turbulent landscape, wisely branching out from the revenue from its streaming sticks and boxes-which is still three-quarters of total sales-into areas like advertising and licensing.

Target to raise minimum wage to $15 by 2020
The controversial House Bill 2, repealed last spring, explicitly forbade local governments from setting their own minimum wages. The $11 wage is higher than the minimum wage in 48 states, and it matches amounts in MA and Washington, Target says.

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.

The offering will raise $126 million in funding for Roku, while giving existing shareholders of the company roughly $93 million.

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. The reason? Prices for the hardware fell by nearly one-third. Blue Apron shares have slumped almost 40% since it went public in June.

Some investors point to cautionary tales like Blue Apron, Snap Inc. and FitBit, whose stocks initially flew high before falling to earth.

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