Bulletins

Roku execs warn company will lose money on hardware as chip shortage continues

The entire industry had been dealing with supply chain shortages for more than a year.

A person partially obscured by the Roku-brand 39" TV box they are carrying toward the checkout area of a big box store
Photo: Luke Sharrett/Getty Images

The global chipset shortage is starting to have an impact on the consumer electronics industry: Roku executives warned in a letter to investors Thursday that the company may lose money on its hardware going forward due to continued supply chain constraints, and Roku CFO Steve Louden told Protocol that the issues were possibly getting worse.


Louden expressed optimism that the company would be able to grow its business despite these shortages, but admitted that gross margins from hardware sales would turn negative in the coming months. "It will have some impact on the business," Louden said.

The entire industry had been dealing with supply chain shortages for more than a year, Louden said, adding that there was no end in sight. "The problems are persisting maybe longer than some people hoped," he said.

Roku has long sold its hardware near cost to grow its user base, which it then monetizes through advertising. The company's Q1 2021 results showed revenue of $574.2 million, compared to $320.8 million during the same quarter a year ago. The company's advertising and services business brought in $466.5 million during the quarter. Earnings per share for the quarter were $0.53; analysts had expected losses of $0.13 per share.

Protocol | Policy

New report shows kids see COVID-19 misinfo on TikTok in minutes

A new report finds that kids as young as 9 are being fed COVID-19 misinformation on TikTok, whether they engage with the videos or not.

NewsGuard researchers asked nine kids to create new TikTok accounts and record their experiences on the app.

Photo: Andrew Harrer/Bloomberg via Getty Images

TikTok is pushing COVID-19 misinformation to children and teens within minutes of creating a new account, whether they actively engage with videos on the platform or not, a new report has found.

The report, published Wednesday by the media rating firm NewsGuard, raises questions not only about how effectively TikTok is enforcing its medical misinformation policies, but also about how its own recommendation algorithms are actively undermining those policies.

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Issie Lapowsky

Issie Lapowsky ( @issielapowsky) is Protocol's chief correspondent, covering the intersection of technology, politics, and national affairs. She also oversees Protocol's fellowship program. Previously, she was a senior writer at Wired, where she covered the 2016 election and the Facebook beat in its aftermath. Prior to that, Issie worked as a staff writer for Inc. magazine, writing about small business and entrepreneurship. She has also worked as an on-air contributor for CBS News and taught a graduate-level course at New York University's Center for Publishing on how tech giants have affected publishing.


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Protocol | China

Beijing meets an unstoppable force: Chinese parents and their children

Live-in tutors disguised as nannies, weekday online tutoring classes and adult gaming accounts for rent. Here's how citizens are finding ways to skirt Beijing's diktats.

Citizens in China are experienced at cooking up countermeasures when Beijing or governments come down with rigid policies.

Photo: Liu Ying/Xinhua via Getty Images

During the summer break, Beijing handed down a parade of new regulations designed to intervene in youth education and entertainment, including a strike against private tutoring, a campaign to "cleanse" the internet and a strict limit on online game playing time for children. But so far, these seemingly iron-clad rules have met their match, with students and their parents quickly finding workarounds.

Grassroots citizens in China are experienced at cooking up countermeasures when Beijing or governments come down with rigid policies. Authorities then have to play defense, amending holes in their initial rules.

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Shen Lu

Shen Lu is a reporter with Protocol | China. Her writing has appeared in Foreign Policy, The New York Times and POLITICO, among other publications. She can be reached at shenlu@protocol.com.

Protocol | Policy

Google and Microsoft are at it again, now over government software

The on-again, off-again battle between the two companies flared up again when Google commissioned a study on how much the U.S. government relies on Microsoft software.

Google and Microsoft are in a long-running feud that has once again flared up in recent months.

Photo: Jens Tandler/EyeEm/Getty Images

According to a new report commissioned by Google, Microsoft has an overwhelming "share in the U.S. government office productivity software market," potentially leading to security risks for local, state and federal governments.

The five-page document, released Tuesday by a trade group that counts Google as a member, represents the latest escalation between the two companies in a long-running feud that has once again flared up in recent months.

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Ben Brody

Ben Brody (@ BenBrodyDC) is a senior reporter at Protocol focusing on how Congress, courts and agencies affect the online world we live in. He formerly covered tech policy and lobbying (including antitrust, Section 230 and privacy) at Bloomberg News, where he previously reported on the influence industry, government ethics and the 2016 presidential election. Before that, Ben covered business news at CNNMoney and AdAge, and all manner of stories in and around New York. He still loves appearing on the New York news radio he grew up with.

People

Facebook wants to kill the family iPad

Facebook has built the first portable smart display, and is introducing a new household mode that makes it easier to separate work from play.

Facebook's new Portal Go device will go on sale for $199 in October.

Photo: Facebook

Facebook is coming for the coffee table tablet: The company on Tuesday introduced a new portable version of its smart display called Portal Go, which promises to be a better communal device for video calls, media consumption and many of the other things families use iPads for.

Facebook also announced a revamped version of its Portal Pro device Tuesday, and introduced a new household mode to Portals that will make it easier to share these devices with everyone in a home without having to compromise on working-from-home habits. Taken together, these announcements show that there may be an opening for consumer electronics companies to meet this late-pandemic moment with new device categories.

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Janko Roettgers

Janko Roettgers (@jank0) is a senior reporter at Protocol, reporting on the shifting power dynamics between tech, media, and entertainment, including the impact of new technologies. Previously, Janko was Variety's first-ever technology writer in San Francisco, where he covered big tech and emerging technologies. He has reported for Gigaom, Frankfurter Rundschau, Berliner Zeitung, and ORF, among others. He has written three books on consumer cord-cutting and online music and co-edited an anthology on internet subcultures. He lives with his family in Oakland.

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