Key Financial Data
- Total net revenue: $1.211 billion (+14% year-over)
- Platform revenue: $1.07 billion (+17%)
- Device revenue: $146 million (-5%)
- Gross profit: $525 million (+9%)
- Operating income: $9.5 million
- Net income: $24.8 million
- Streaming hours: 36.5 billion (+4.5 billion)
- Read more coverage of Q3 media earnings
Roku is so back.
The connected television giant posted positive financial earnings for the third quarter (Q3) of the year, grabbing $1.21 billion in overall revenue and seeing its first full quarter of profitability in four years.
Roku logged $9.5 million in operating income, marking its first profitable quarter since 2024 and fully offsetting its $36 million loss from last year. Net incoem reached $24.8 million, compared to an income loss of $9 million during Q3 2024. EBITDA climbed to $116.9 million from $98.2 million a year earlier, while gross profit grew 9 percent to $525 million, the company said.
Roku CEO Anthony Wood said the quarter’s results reflected the strength of Roku’s platform model and its ability to grow both engagement and monetization. The company’s streaming hours hit 36.5 billion during the period, up 4.5 billion from a year ago, with The Roku Channel maintaining its position as the second most-engaged app in the United States.
The Roku Channel is the largest free, ad-supported streaming TV (FAST) platform in American homes in terms of time spent with TV in a given month, according to Nielsen. In the measurement firm’s most-recent “The Gauge” report, Nielsen said The Roku Channel accounted for more than 6 percent of all time spent with TV in September. The Roku Channel is a default app on the company’s streaming TV hardware, including Roku-powered smart TVs.
Roku credited its advertising gains to deeper integrations with third-party ad demand and measurement platforms, as well as expanding use of Roku Ads Manager among small and mid-sized advertisers. The company also cited growing demand from performance-based marketers in e-commerce, mobile, and gaming.
Platform revenue attributed to advertising and subscription income rose to $1.07 billion during Q3, up 17 percent on a year-over basis.
Stock Price
On the content side, Roku launched “Howdy,” a service with a subscription price of $3 per month that offers ad-free streaming of licensed content from Lionsgate, FilmRise and other vendors. Most of the content available in Howdy is also accessible through The Roku Channel and other platforms with ads.
Roku also expanded the amount of free content available through The Roku Channel by inking new licensing agreements that brought a dedicated “Law & Order” channel and back episodes of the ABC reality-based competition series “Shark Tank” to the service.
Device revenue, which includes Roku’s streaming players and smart TVs, declined 5 percent to $146 million, consistent with the company’s shift away from hardware dependence. Roku remains the top-selling TV operating system in the United States, Canada and Mexico, and its software is now built into more than half of U.S. broadband households, the company said on Thursday.
Looking ahead, Roku expects fourth-quarter revenue of about $1.35 billion, up 12 percent from the prior year, with platform revenue growth projected at 15 percent. The company raised its full-year guidance, forecasting platform revenue of $4.11 billion and adjusted EBITDA of $395 million.
Roku also repurchased $50 million of its common stock during the quarter as part of its $400 million buyback program. Wood said the results and outlook underscored Roku’s “commitment to delivering long-term shareholder value by growing free cash flow per share.”
Despite the positive financial data, Roku’s stock price was down nearly 10 percent in after-hours trading on Thursday.
