Roku Smashes Expectations with $183 Million Net Income as Acquisition by Fox Looms
Roku’s third‑quarter results vaulted past forecasts, delivering record revenue growth and a 639% jump in net income.
Wow! Roku announced third‑quarter numbers that not only topped Wall Street forecasts but also set a new high‑water mark for its media and entertainment segment.
Revenue surged to $1.5 billion, a 24% rise from the same quarter last year and well above the $1.41 billion analysts had penciled in.
Net income exploded to $183 million, a staggering 639% jump, delivering diluted earnings per share of $1.20 compared with the consensus estimate of $0.55.
Platform revenue climbed to $1.3 billion, up 34% year‑over‑year, driven by robust gains in both advertising and subscriptions.
Advertising revenue rose 23% to $727 million, marking Roku’s ninth straight quarter of double‑digit growth, helped by higher‑margin ad products and strong political advertising that outperformed the comparable quarter of the 2024 presidential election cycle.
Subscriptions revenue also grew 23% to $581 million, though its gross margin slipped to 40.9% after a “strategic mix shift toward premium subscriptions.”
Streaming hours reached 39.9 billion, up 9% year‑over‑year, while the company highlighted the completed rollout of a new U.S. home screen that sharpened content recommendations.
One early result we are seeing is a reduction in Premium Subscription cancellations, the shareholder letter noted, and the refreshed home screen is now being rolled out internationally.
The earnings burst comes as Fox moves forward with its pending acquisition of Roku at $160 per share, valuing the streaming platform at $22 billion. The deal, announced in June, pairs Fox’s sports, news, entertainment assets and the Tubi streaming service with Roku’s connected‑TV ecosystem.
Roku CEO Anthony Wood called the transaction a “great price” and the “best way to accelerate our long‑term strategy and continue shaping the future of television.”
Fox CEO Lachlan Murdoch said the company is working “constructively” with the Department of Justice to close the deal, which has already cleared shareholder and foreign regulator approval.
Because of the pending acquisition, Roku did not issue a financial outlook nor host an earnings call, echoing its approach from the prior quarter.
Wood reaffirmed the company’s commitment to its second‑half 2026 forecast and described the Fox deal as an “extraordinary opportunity to accelerate our vision, allowing us to scale faster and innovate more aggressively for viewers, partners and advertisers.”
Stay tuned for further updates as the transaction progresses and Roku continues to reshape the streaming landscape.
