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What changed in ROKU, INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ROKU, INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+415 added−418 removedSource: 10-K (2026-02-13) vs 10-K (2025-02-14)

Top changes in ROKU, INC's 2025 10-K

415 paragraphs added · 418 removed · 339 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

67 edited+23 added−16 removed50 unchanged
Biggest changeInternational Markets The shift from traditional TV to TV streaming is a global phenomenon, as it offers viewers better choice and greater control over their entertainment. We believe that the value our business delivers to viewers, content partners, and advertisers is as compelling in international markets as it is in the United States.
Biggest changeWe also have a partner integration with Roku Ads Manager to enable SMBs to efficiently repurpose social media content for TV streaming, reducing production costs and complexity to make advertising on TV more accessible. International Markets The shift from traditional TV to TV streaming is a global phenomenon, as it offers viewers better choice and greater control over their entertainment.
Our billing service assists content partners with their billing needs, such as managing payment methods, subscriptions, and customer invoices. This service also allows content partners to enable a frictionless signup within their app, and we believe this key benefit simplifies user subscription signups and drives purchase and retention for our content partners.
Our payment and billing service assists content partners with their billing needs, such as managing payment methods, subscriptions, and customer invoices. This service also allows content partners to enable a frictionless signup within their app, and we believe this key benefit simplifies user subscription signups and drives purchase and retention for our content partners.
The display ads we offer are integrated into the Roku Experience and are only possible because we are the streaming platform. These differentiated ads fall into three main categories of native ads, native destinations, and action ads.
The display ads we offer are integrated into the Roku Experience and are only possible because we are the streaming platform. These differentiated ads fall into three main categories of native ads, destinations, and action ads.
The Roku Channel aggregates a broad variety of entertainment into a unified streaming experience, through three distinct types of content: • AVOD (ad-supported video on demand): Viewers can stream a broad variety of 80,000+ movies and TV shows, including Roku Originals, for free. • Live TV : Viewers have access to watch 500+ FAST (free, ad-supported linear streaming TV) channels in genres ranging from news to sports to entertainment to creator content. • Premium Subscriptions : Viewers can easily sign up, view, and manage subscriptions to dozens of SVOD apps, such as Max and Paramount+, with a single, monthly bill.
The Roku Channel aggregates a broad variety of entertainment into a unified streaming experience, through three distinct types of content: • AVOD (ad-supported video on demand): Viewers can stream a broad variety of 80,000+ movies and TV shows, including Roku Originals, for free. • Live TV : Viewers have access to watch 500+ FAST (free, ad-supported linear streaming TV) channels in genres ranging from news to sports to entertainment to creator content. • Premium Subscriptions : Viewers can easily sign up, view, and manage subscriptions to dozens of SVOD apps, such as HBO Max and Paramount+, with a single, monthly bill.
Compliance with existing or future laws and regulations, including, but not limited to, those pertaining to internet and online services, data privacy and security, consumer protection, global trade, environmental protection, employee health and safety, and taxes, could have an adverse impact on our business in subsequent periods.
Compliance with existing or future laws and regulations, including, but not limited to, those pertaining to internet and online services, data privacy and security, minors’ safety, consumer protection, global trade, environmental protection, employee health and safety, and taxes, could have an adverse impact on our business in subsequent periods.
Content partners can use a variety of ad types, such as native display ads on the Roku Home Screen to drive app downloads, promote an app’s content, or direct traffic to their apps in order to drive subscriptions or movie and TV show consumption.
Content partners can use a variety of ad types, such as native ads on the Roku Home Screen to drive app downloads, promote an app’s content, or direct traffic to their apps in order to drive subscriptions or movie and TV show consumption.
In the United States, the majority of our products and our licensed Roku TV partners’ products are sold through traditional brick and mortar retailers, such as Best Buy, Target, and Walmart, including their online sales platforms, and online retailers such as Amazon, and to a lesser extent our website (excluding Roku TV models).
In the United States, the majority of our products and our licensed Roku TV partners’ products are sold through brick and mortar retailers, such as Best Buy, Target, and Walmart, including their online sales platforms, and online retailers such as Amazon, and to a lesser extent our website (excluding Roku TV models).
Item 1: Business Overview Roku, Inc. (“Roku,” the “Company,” “we,” or “us”) is the leading TV streaming platform in the United States, Canada, and Mexico by hours streamed. We pioneered streaming to the TV and believe that all TV will be streamed.
Item 1: Business Overview Roku, Inc. (“Roku,” the “Company,” “we,” or “us”) is the leading TV streaming platform in the United States, Canada, and Mexico by hours streamed. We pioneered TV streaming and believe that all TV will be streamed.
Our Learning and Talent Development team provides our employees with the training and development needed to support our strategic priorities and growth. Our employee development programs begin with a comprehensive new hire onboarding experience covering our culture, business, and the resources needed to increase our new hires’ speed to productivity.
Our Learning and Growth team provides our employees with the training and development needed to support our strategic priorities and growth. Our employee development programs begin with a comprehensive new hire onboarding experience covering our culture, business, and the resources needed to increase our new hires’ speed to productivity.
Additionally, Roku TV Ready allows certified soundbars to quickly and easily connect to Roku TVs, enabling the use of one remote and having all the sound settings uploaded to the TV. This is another example of Roku’s innovative TV ecosystem.
Additionally, the Roku TV Ready program allows certified soundbars to quickly and easily connect to Roku TVs, enabling the use of one remote and having all the sound settings uploaded to the TV. This is another example of Roku’s innovative TV ecosystem.
Platform Segment: Growing and Monetizing User Engagement The Roku Experience We call the user experience on the Roku platform the “Roku Experience.” It represents all the features that Roku builds and operates to engage, delight, and help our viewers find great entertainment.
Platform Segment: Growing and Monetizing User Engagement The Roku Experience We call the user experience on the Roku platform the “Roku Experience.” It represents all the features and destinations that Roku builds and operates to engage, delight, and help our viewers find great entertainment.
For example, the threat, implementation, or modification of new import restrictions in the U.S., as well as any retaliatory measures adopted by affected U.S. trade partners, could prove disruptive to the business environment in which we operate. Finally, our content business is subject to a wide range of government regulations that may vary by jurisdiction.
For example, the threat, implementation, or modification of new import restrictions in the United States, as well as any retaliatory measures adopted by affected U.S. trade partners, could prove disruptive to the business environment in which we operate. Finally, our content business is subject to a wide range of government regulations that may vary by jurisdiction.
Our competitors include: • companies that offer TV streaming devices that compete with Roku streaming devices and companies that license their operating systems for integration into smart TVs and other streaming products; • TV brands that offer their own TV streaming solutions within their TVs as well as other devices such as game consoles, DVD players, Blu-ray players, and set-top boxes that leverage their own operating systems; 6 Table of Contents • streaming applications that enable users to stream content on phones, tablets, and laptop computers; • companies that produce and aggregate TV streaming content with the goal of attracting wide audiences; • companies that offer advertisers the opportunity to reach viewers on other content and advertising mediums, including on other ad-supported streaming services and social media applications; • companies that offer users other sources for news and entertainment, including broadcast and cable television networks, newspapers and magazines, social networks, and video games; • companies that offer products that compete with our audio products or our smart home products and services; and • companies that operate in the same locations as our offices or offer remote work positions that may be better able to attract and retain top talent in engineering, research and development, sales and marketing, operations, and other organizations.
Our competitors include: • companies that offer TV streaming devices that compete with Roku streaming devices and companies that license their operating systems for integration into smart TVs and other streaming products; • TV brands that offer their own TV streaming solutions within their TVs as well as other devices such as game consoles, DVD players, and set-top boxes that leverage their own operating systems; • streaming applications that enable users to stream content on phones, tablets, and laptop computers; • companies that produce and aggregate TV streaming content with the goal of attracting wide audiences; • companies that offer advertisers the opportunity to reach viewers on other content and advertising mediums, including on other ad-supported streaming services and social media applications; • companies that offer users other sources for news and entertainment, including broadcast and cable television networks, newspapers and magazines, social networks, and video games; • companies that offer products that compete with our audio products or our smart home products and services; and • companies that operate in the same locations as our offices or offer remote work positions that may be better able to attract and retain top talent in engineering, research and development, sales and marketing, operations, and other organizations.
We must continue to innovate and invest in our advertising capabilities and technology so that we attract and encourage incremental advertising spend on our streaming platform. We aim to balance our commitment to growing Adjusted EBITDA and Free Cash Flow with our investments to further expand our scale, engagement, and monetization. Advertising Innovation We continue to innovate our advertising offerings.
We must continue to innovate and invest in our advertising capabilities and technology so that we attract and encourage incremental advertising spend on our streaming platform. We aim to balance our commitment to growing Adjusted EBITDA and Free Cash Flow with our investments to further expand our scale, engagement, and monetization.
As the TV streaming market continues to develop, we may become subject to additional competition as we introduce or develop new products and services, as our existing products and services evolve, or as other companies introduce competing products and services. Human Capital Management We believe our success depends on our culture and our ability to attract and retain our employees.
As the TV streaming marketplace continues to develop, we may become subject to additional competition as we introduce or develop new products and services, as our existing products and services evolve, or as other companies introduce competing products and services. Human Capital Management We believe our success depends on our culture and our ability to attract and retain our employees.
Our three key initiatives to grow platform revenue are to innovate the Roku Home Screen to expand monetization, grow advertising demand through deeper third-party platform integrations, and grow Roku-billed subscriptions. Devices Segment: Providing Easy Access to TV Streaming We make TV streaming accessible to consumers through a broad lineup of devices, at a variety of competitive price points.
Our three key initiatives to grow Platform revenue are to innovate the Roku Home Screen to expand monetization, grow advertising demand through deeper third-party platform integrations, and grow Roku-billed subscriptions. Devices Segment: Growing Scale through Easy Access to TV Streaming We make TV streaming accessible to consumers through a broad lineup of devices, at a variety of competitive price points.
We generate platform revenue primarily from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services), as well as streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls).
We generate Platform revenue from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls).
We are always seeking new ways to innovate to expand the role the Roku Experience can play in helping viewers find what to watch, which simultaneously benefits our content partners and advertisers while creating monetization opportunities for Roku. 2 Table of Contents Platform Revenue Our TV streaming platform enables content partners and advertisers to reach audiences that are increasingly unreachable on traditional TV.
We are always seeking new ways to innovate to expand the role the Roku Experience can play in helping viewers find what to watch, which simultaneously benefits our content partners and advertisers while creating monetization opportunities for Roku. Platform Revenue Our TV streaming platform enables content partners and advertisers to reach audiences that are increasingly unreachable on traditional TV.
In addition, all employees have access to on-demand technical and non-technical skill development through LinkedIn Learning. We intend to continue to review, refresh, purchase, and custom-build additional training materials to support our global employees’ performance and development needs. 7 Table of Contents Our total compensation program is designed to attract, retain, and reward talented professionals.
In addition, all employees have access to on-demand technical and non-technical skill development through LinkedIn Learning. We intend to continue to review, refresh, purchase, and custom-build additional training materials to support our global employees’ performance and development needs. Our total compensation program is designed to attract, retain, and reward talented professionals.
Governments in both the U.S. and other jurisdictions also have adopted, or are considering adoption, of laws and regulations intended to protect minors’ privacy and otherwise protect minors from perceived harms online. Privacy and other laws also may limit the ability of advertisers to fully utilize our platform, which could have a negative impact on our business.
Governments in both the United States and other jurisdictions also have adopted, or are considering adoption, of laws and regulations intended to protect minors’ privacy and otherwise protect minors from perceived harms online. Privacy and other laws also may limit the ability of advertisers to fully utilize our platform, which could have a negative impact on our business.
As part of our distribution agreements with AVOD apps, we typically secure direct access to a portion of the content partners’ video advertising inventory for our monetization, and our sales efforts are differentiated and complementary to that of our content partners.
As part of our distribution agreements with ad-supported apps, we typically secure direct access to a portion of the content partners’ video advertising inventory for our monetization, and our sales efforts are differentiated and complementary to that of our content partners.
These laws and regulations include general business regulations and laws, as well as regulations and laws specific to providers of internet-delivered streaming services and internet-connected devices. 5 Table of Contents For example, in both the United States and abroad, the regulatory framework for privacy and data security issues is rapidly evolving.
These laws and regulations include general business regulations and laws, as well as regulations and laws specific to providers of streaming services and internet-connected devices. For example, in both the United States and abroad, the regulatory framework for privacy and data security issues is rapidly evolving.
Native destinations include sponsorships of a playlist, zone (e.g., the Roku Sports Zone), fan experience (e.g., the premiere of a new TV show season), or a “pass” that provides viewers with a free movie/TV show.
Destinations include sponsorships of a playlist, destination (e.g., the Roku Sports Experience), fan experience (e.g., the premiere of a new TV show season), or a “pass” that provides viewers with a free movie/TV show.
Information contained on or accessible through the websites listed above is not incorporated by reference nor otherwise included in this Annual Report, and any references to these websites are intended to be inactive textual references only. 8 Table of Contents
Information contained on or accessible through the websites listed above is not incorporated by reference nor otherwise included in this Annual Report, and any references to these websites are intended to be inactive textual references only.
Our ad sales teams and products are organized into groups that specialize in the unique needs of each area: (i) agency holding companies and Fortune 500 brands, (ii) independent agency and mid-market clients, (iii) content partners and entertainment brands, (iv) performance and direct-to-consumer brands, and (v) international markets.
Our ad sales teams and products are organized into groups that specialize in the unique needs of each area: agency holding companies and Fortune 500 brands, independent agency and mid-market clients, content partners and entertainment brands, performance and direct-to-consumer brands, and international markets.
Regulators in the United States and abroad continue to evaluate policy changes that could affect the openness of the internet.
Regulators in the United States and abroad regularly evaluate policy changes that could affect the openness of the internet.
We dedicate significant resources to build, maintain, and advance the Roku TV OS; to provide an industry-leading streaming platform for our viewers, content partners, and advertisers; to obtain content for our streaming platform that attracts viewers, including our own original programming (Roku Originals); and to extend Roku’s leadership as the global shift to TV streaming continues.
We dedicate significant resources to build, maintain, and advance the Roku TV OS; to provide an industry-leading streaming platform for our viewers, content partners, and advertisers; to obtain content for our streaming platform that attracts viewers, including on our owned and operated streaming services (The Roku Channel, Howdy, and Frndly TV) and to our original programming (Roku Originals); and to extend Roku’s leadership as the global shift to TV streaming continues.
Streaming Hours We grew Streaming Hours on the overall Roku platform from 106.0 billion hours in 2023 to 127.1 billion hours in 2024 through increasing the distribution of Roku streaming devices, increasing our Streaming Households, and continuing to enhance the Roku Experience.
Streaming Hours We grew Streaming Hours on the overall Roku platform from 127.1 billion hours in 2024 to 145.6 billion hours in 2025 through increasing the distribution of Roku streaming devices, increasing our Streaming Households, and continuing to enhance the Roku Experience.
As of December 31, 2024, we had approximately 1,500 issued patents and 600 pending applications in the United States and foreign countries. We also license technology from third parties when we believe it will facilitate our product offerings or business.
As of December 31, 2025, we had approximately 1,800 issued patents and 650 pending applications in the United States and foreign countries. We also license technology from third parties when we believe it will facilitate our product 6 Table of Contents offerings or business.
The Roku Home Screen is the first thing our viewers see when they start streaming, and from this position, we can help the viewer decide what to watch every day across the vast range of options available to them on our streaming platform.
The Roku Experience begins with our Home Screen, which is the first thing our viewers see, reaching them before they decide what to watch. From this position, we can help the viewer decide what to watch every day across the vast range of options available to them on our streaming platform.
We are developing relationships with more third-party ad-buying platforms (e.g., retail media networks, DSPs, SSPs, and other strategic partners) to reach marketers buying programmatic advertising on such platforms and to create more demand opportunities for our advertising inventory.
We continue to develop relationships with third-party partners and ad-buying platforms (e.g., major direct holding company and ad agency relationships, DSPs, SSPs, retail media networks, and other strategic partners) to reach marketers buying programmatic advertising on such platforms and to create more demand opportunities for our advertising inventory.
As of December 31, 2024, we employed approximately 3,340 full-time employees located in 15 countries. Only our employees in Brazil are represented by a labor union with respect to their employment. The majority of our employees have adopted a hybrid work schedule (consisting of both in-person work and working from home).
As of December 31, 2025, we employed approximately 3,600 full-time employees located in 15 countries. Only our employees in Brazil are represented by a labor union with respect to their employment. Most of our employees have a hybrid work schedule (consisting of both in-person work and working from home). We want our employees to be proud to work at Roku.
Because our employees are trusted and encouraged to make decisions, our leadership communicates plans, milestones, and strategic context broadly, and our employees are trusted to maintain the confidentiality of such information. Our employees are encouraged to leverage our broad talent base for diverse points of view when making decisions.
Across Roku, teams are expected to communicate clearly, in real time. Because our employees are trusted and encouraged to make decisions, our leadership communicates plans, milestones, and strategic context broadly, and our employees are trusted to maintain the confidentiality of such information. Our employees are encouraged to leverage our broad talent base for varied points of view when making decisions.
Many of our action ads are in partnership with companies such as Walmart, Shopify, and Instacart that connect their products with viewers and provide enhanced targeting and closed-loop measurement. 3 Table of Contents Roku enables advertisers to measure TV streaming ad performance throughout the Roku Experience.
Many of our action ads are in partnership with companies such as Walmart, Shopify, and Instacart that connect their products with viewers and provide enhanced targeting and closed-loop measurement. Roku enables advertisers to measure TV streaming ad performance throughout the Roku Experience. Our measurement framework is built on a foundation of verified identity, consisting of direct relationships with viewers.
As we grow our business, our goal is to ensure that Roku continues to be a great place to work and thrive. We are committed to fostering an inclusive workplace to spark innovation, strengthen teamwork, equip us to build exceptional products, and drive us to deliver the best TV streaming content.
As we grow our business, our goal is to ensure that Roku continues to be a great place to work and thrive. We are committed to fostering an inclusive workplace to strengthen teamwork, build exceptional products, and deliver the best TV streaming content. We believe our employees should feel valued and empowered to contribute, collaborate, and thrive.
They can also reach and engage those viewers who do not use traditional TV services. As more viewers shift to TV streaming, content partners that publish apps on our platform are able to reach these streaming audiences at scale and engage viewers directly.
As more viewers shift to TV streaming, content partners that publish apps on our platform are able to reach these streaming audiences at scale and engage viewers directly.
Owning and operating both The Roku Channel and our streaming platform creates unique value, making us a leader in free content, positioning us to be a valuable partner to content partners, and providing a large source of advertising inventory.
Owning and operating both the streaming apps and our streaming platform creates unique value, enables us to be a leader in free and affordable content, positions us to be a valuable partner to content partners, and creates a large source of advertising inventory for us to monetize.
In international markets, we plan to continue to focus on building scale first, increasing engagement, and ultimately driving monetization. We are successfully growing The Roku Channel audience internationally. The Roku Channel is available on devices powered by the Roku TV OS in the United Kingdom, Canada, and Mexico.
We also announced Roku TV models with new partners in the United Kingdom. In international markets, we plan to continue to focus on building scale first, increasing engagement, and ultimately driving monetization. We are successfully growing The Roku Channel audience internationally.
This award-winning lineup includes the Roku Select and Roku Plus Series TVs, and the Roku Pro Series TVs, which are our higher-performing TVs that we launched in spring 2024. Roku-branded TVs complement our successful Roku TV licensing program.
In 2023, we launched Roku-made TVs, which are designed, made, and sold by us. This award-winning lineup includes the Roku Select and Roku Plus Series TVs, and the Roku Pro Series TVs, which are our higher-performing TVs that we launched in spring 2024.
In addition, we solicit user feedback in the development of new features and enhancements to our platform. We intend to continue to invest significantly in research and development to bring new or improved products and services to market. Manufacturing We outsource the manufacturing of our products to our contract manufacturers, original design manufacturers, and other contractors and vendors.
We intend to continue to invest significantly in research and development to bring new or improved products and services to market. Manufacturing We outsource the manufacturing of our products to our contract manufacturers, original design manufacturers, and other contractors and vendors. All of our products are manufactured in China, Southeast Asia, Brazil, and Mexico.
We want our employees to be proud to work at Roku. Our entrepreneurial, execution-focused culture emphasizes recruiting talented individuals, encouraging teamwork, and expecting our employees to perform at a high level. We also emphasize integrity, transparency, and honesty in our internal and external conduct of business.
Our entrepreneurial, execution-focused culture emphasizes recruiting talented individuals, encouraging teamwork, and expecting our employees to perform at a high level. We also emphasize integrity, transparency, and honesty in our internal and external conduct of business. All employees are required to comply fully with our Code of Conduct and Business Ethics, which sets forth our values, business culture, and practices.
Research and Development Our research and development model relies on a combination of in-house staff and outsourced development and manufacturing partners to cost-effectively improve and enhance our platform, and to develop new TVs, players, audio products, smart home devices, features, and functionality.
Research and Development Our research and development model relies on a combination of in-house staff and outsourced development and manufacturing partners to cost-effectively improve and enhance our platform, and to develop new TVs, players, audio products, features, and functionality. We work closely with content partners, advertisers, and licensed Roku TV partners to understand their current and future needs.
The Roku Channel is available on devices powered by the Roku TV OS in the United States, the United Kingdom, Canada, and Mexico. In the United States, it is also available via the Roku mobile app, online at TheRokuChannel.Roku.com, and on Amazon Fire TVs, Samsung TVs, Google TV, and other Android TV OS devices.
In the United States, it is also available via the Roku mobile app, online at TheRokuChannel.Roku.com, and on Amazon Fire TVs, Samsung TVs, Google TV, and other Android TV OS devices. 2 Table of Contents Frndly TV In May 2025, we acquired Frndly TV, Inc.
Government Regulation Our business and our products and platform are subject to numerous U.S. federal, U.S. state, and foreign laws and regulations covering a wide variety of subject matters.
The manufacturers ship our products to our third-party warehouses, from where we ship our products directly to retailers, wholesale distributors, and consumers. Government Regulation Our business and our products and platform are subject to numerous U.S. federal, U.S. state, and foreign laws and regulations covering a wide variety of subject matters.
We support retailers with an experienced sales management team and work closely with these retailers to assist with marketing and product mix forecasting. We intend to continue to invest significant resources in our sales and marketing efforts. Seasonality We have historically seen seasonality in our business related to advertising and device sales.
We intend to continue to invest significant resources in our sales and marketing efforts. Seasonality We have historically seen seasonality in our business related to advertising and device sales.
Our sales and marketing activities are primarily focused on building and expanding relationships with content partners, advertisers, TV brands, and retailers, and driving sales of our products and our licensed Roku TV partners’ products to consumers through retail distribution channels. 4 Table of Contents We have dedicated business development teams that develop and maintain relationships to promote and build awareness of the features and advantages of our streaming platform among content partners, advertisers, and TV brands.
Our sales and marketing activities are primarily focused on building and expanding relationships with content partners, advertisers, TV brands, and retailers, and driving sales of our products and our licensed Roku TV partners’ products to consumers through retail distribution channels.
We also sell products internationally through distributors and to retailers. Amazon, Best Buy, Walmart, and Target collectively accounted for 81% of our devices revenue for the year ended December 31, 2024 and 76% of our devices revenue for the year ended December 31, 2023.
We also sell products internationally through distributors and to retailers. Amazon, Best Buy, Walmart, and Target collectively accounted for 81% of our Devices revenue for the year ended December 31, 2025. We support retailers with an experienced sales management team and work closely with these retailers to assist with marketing and product mix forecasting.
Mexico remains the channel’s largest market outside of the United States by Streaming Households and Streaming Hours. With strong scale and engagement, we are working to grow monetization in Mexico. Sales and Marketing We engage in a wide variety of sales and marketing activities to continuously grow scale, engagement, and monetization and dedicate significant resources to this area.
Sales and Marketing We engage in a wide variety of sales and marketing activities to continuously grow scale, engagement, and monetization, and we dedicate significant resources to this area.
We believe our Roku-branded TVs will enable us to further grow our leadership position in TV streaming and compete in the higher-end range of performance TVs. Roku-branded TVs will also help us innovate more quickly in all aspects of hardware and software and test directly with viewers, improving the product and viewer experience and strengthening the entire Roku ecosystem.
Roku-made TVs also help us innovate more quickly in all aspects of hardware and software and test directly with viewers, improving the product and viewer experience and strengthening the entire Roku ecosystem. Roku streaming players enable users to easily turn (nearly) any TV into a smart TV.
Our devices segment generates revenue from the sale of Roku streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories. Roku TV models are TVs made and sold by our Roku TV partners, which are TV original equipment manufacturers (“OEMs”) that license the Roku TV OS and leverage our smart TV reference designs.
Our devices segment generates revenue from the sale of Roku streaming players, Roku-made TVs, Roku TV smart projectors, smart home products and services, audio products, and related accessories.
We seek to make purposeful investments in developing future talent across our industry through our Social Impact program. Our employees partner with nonprofits to share their expertise and provide young people with valuable industry insights and hands-on experiences. We also collaborate with external organizations to connect a broad range of talent with real-world opportunities in media and entertainment.
Through collaboration with educational and workforce development organizations, employees share their 7 Table of Contents expertise to offer young people valuable industry insights and hands-on experiences. We also work with industry partners to connect a broad range of talent to real-world opportunities in media and entertainment.
Today Roku streaming devices are available in 15+ countries. We are the leading TV streaming platform in the United States, Canada, and Mexico by hours streamed. Internationally, we continue to grow our footprint and deepen our presence in key markets.
We believe that the value our business delivers to viewers, content partners, and advertisers is as compelling in international markets as it is in the United States. Today Roku streaming devices are available in 15+ countries. We are the leading TV streaming platform in the United States, Canada, and Mexico by hours streamed.
This first party data enables us to develop actionable insights such as content recommendations to improve our viewers’ experience. In 2024, we added a new personalized content row powered by AI to the Roku Home Screen. Unlike suggestions from streaming services, which are restricted to their libraries, our recommendations include content from streaming apps across our platform.
Our Home Screen includes features such as our content row (located on the top right), which we launched in 2024 to make personalized, AI-powered recommendations to our users. Unlike suggestions from streaming services, which are restricted to their libraries, our recommendations include content from streaming apps across our platform.
Just as ads evolved decades ago when TV replaced radio as the primary entertainment medium, ads on TV streaming offer new and more performant opportunities than traditional TV. Advertisers are able to leverage the combination of our significant scale, our direct relationship with viewers, and our innovative ad products and technology to reach consumers with relevant messages.
Just as ads evolved decades ago when TV replaced radio as the primary entertainment medium, ads on TV streaming offer new and more performant opportunities than traditional TV.
We work closely with content partners, advertisers, and licensed Roku TV partners to understand their current and future needs. We have designed a product development process that seeks to take input from our partners into account when making decisions about our future product and service offerings.
We have designed a product development process that seeks to take input from our partners into account when making decisions about our future product and service offerings. In addition, we solicit user feedback in the development of new features and enhancements to our platform.
Roku streaming players enable users to easily turn (nearly) any TV into a smart TV. We launch new streaming player models periodically with a focus on offering high performance at an affordable price. In September 2024, we launched our most powerful streaming player to date: the 2024 Roku Ultra.
We launch new streaming player models periodically with a focus on offering high performance at an affordable price. In 2025, we introduced two new streaming players, the Roku Streaming Stick and Roku Streaming Stick Plus, with the performance and speed that our users have come to expect.
Our manufacturers procure components and assemble our products to demand forecasts we establish based upon historical trends and analysis from our sales, operations, and product management functions. The manufacturers ship our products to our third-party warehouses, from where we ship our products directly to retailers, wholesale distributors, and consumers.
Our contracts do not obligate our partners to supply products to us in any specific quantity or at any specific price. Our manufacturers procure components and assemble our products to demand forecasts we establish based upon historical trends and analysis from our sales, operations, and product management functions.
The Roku ecosystem extends beyond TV streaming and audio to smart home devices that include cameras, video doorbells, lights, plugs, a home monitoring system, and our Roku Smart Home mobile application for iOS and Android. Similar to our TV streaming business model, we build scale by selling Roku Smart Home devices and then monetize through smart home services.
The Roku ecosystem includes smart home devices that include cameras, video doorbells, lights, plugs, a home monitoring system, and our Roku Smart Home mobile application for iOS and Android. We offer subscription plans for our cameras, video doorbells, and home monitoring system. Roku streaming devices are broadly distributed online and at popular national retailers.
In addition, as a global TV streaming platform, we seek to delight our consumers through inclusive content, services, and partnerships that enrich the Roku Experience for our audiences everywhere. Our Inclusion Strategy and Roku Media teams partner to elevate storytelling that authentically represents and resonates with audiences from different backgrounds.
Our Inclusion Strategy team partners across Roku to advance inclusion through strategic programs, support our employee resource groups, expand talent communities, and amplify our employer brand story. Beyond the employee experience, as a global TV streaming platform, we seek to delight our consumers through inclusive content, services, and partnerships that enrich the Roku Experience for our audiences everywhere.
We offer subscription plans for our cameras, video doorbells, and home monitoring system. Through our streaming devices and the Roku platform, we provide viewers tremendous choice, value, and an exceptional viewer experience. In 2024, we added 9.8 million net Streaming Households, ending the year with 89.8 million Streaming Households.
Through our streaming devices and the Roku platform, we provide viewers tremendous choice, value, and an exceptional viewer experience.
Our measurement framework is built on a foundation of verified identity, consisting of direct relationships with viewers. We can combine this asset with the advertiser’s preferred data sources to provide an expansive measurement toolkit that includes reach measurement, brand resonance, and sales attribution, among others.
We can combine this asset with the advertiser’s preferred data sources to provide an expansive measurement toolkit that includes reach measurement, brand resonance, and sales attribution, among others. We also have third-party partnerships that allow advertisers to buy, optimize, and measure their campaigns, whether directly through Roku or through another buying platform.
We have driven strong Streaming Household growth through this Roku TV licensing program, which we launched more than 10 years ago. In 2023, we launched Roku-branded TVs, which are designed, made, and sold by us.
Roku TV models are TVs made and sold by our Roku TV partners, which are TV original equipment manufacturers (“OEMs”) that license the Roku TV OS and leverage our smart TV reference designs. We have grown our scale through this Roku TV licensing program, which we launched more than 10 years ago.
This content row is designed to recommend TV shows and movies to viewers while simultaneously driving growth for Roku in areas such as Streaming Hours, SVOD signups, and ad reach. Our significant scale, ability to reach highly engaged viewers, tools that enable seamless signups, and marketing/discovery features make us an attractive platform to content partners.
This first party data enables us to develop actionable insights such as content recommendations to improve our viewers’ experience. Our significant scale, ability to reach highly engaged viewers, tools that enable seamless signups, and marketing/discovery features make us an attractive platform to content partners. They can also reach and engage those viewers who do not use traditional TV services.
The Roku Channel benefits from its integration throughout the Roku Experience, which has features such as Live TV, Sports, What to Watch, and more that can surface content to our viewers directly. The Roku Channel is a core strategic asset in our monetization efforts that simultaneously benefits viewers, content partners, and advertisers, while generating platform revenue.
Our streaming apps benefit significantly from their integration throughout the Roku Experience, which has features such as the content row on our Home Screen, Live TV, and the Sports Experience, among others, that can directly surface content to our viewers.
We offer advertisers a unique and effective set of tools to reach viewers and measure both the effectiveness of the ads served and their return on investment. We sell both in-stream video ads and display ads integrated into our user interface (“UI”).
We offer advertisers a unique and effective set of tools to reach viewers at scale and measure both the effectiveness of the ads served and their return on investment. Furthermore, our comprehensive ad offering enables advertisers to decide how they buy Roku media, whether through direct insertion order, a preferred DSP partner, or Roku Ads Manager, our self-service ad platform.
Roku streaming devices are broadly distributed at popular national retailers such as Amazon, Best Buy, Costco, CVS, The Home Depot, Lowe’s, Sam’s Club, Target, Walgreens, and Walmart. 1 Table of Contents Audio is an important part of the TV streaming experience, and we offer Roku-branded wireless speakers and subwoofers that seamlessly connect to TVs powered by the Roku TV OS.
In 2025, we also launched our Roku TV smart projectors designed for both indoor and outdoor use, with the Roku TV OS built in, to deliver flexible screen sizing for entertainment anywhere. 1 Table of Contents Audio is an important part of the TV streaming experience, and we offer Roku-branded wireless soundbars, speakers, and subwoofers that seamlessly connect to TVs powered by the Roku TV OS.
A key competitive advantage that continues to drive our success is the combination of our significant scale and the Roku Experience, which begins with the Roku Home Screen.
The Sports Experience enables fans to easily find their favorite sport, team, or event, which benefits not only our viewers but also our content partners. Overall, the Roku Experience, combined with our significant scale of more than 90 million Streaming Households globally, is a key competitive advantage that continues to drive our success.
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This premium streaming player comes bundled with the Voice Remote Pro (2nd edition), our most advanced remote.
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We periodically refresh the lineup of Roku-made TVs with the goal to provide our customers with an outstanding TV streaming experience. Roku-made TVs complement our successful Roku TV licensing program. We believe our Roku-made TVs enable us to further grow our leadership position in TV streaming and compete in the higher-end range of performance TVs.
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As an example, sports is an important entertainment category for viewers and advertisers, and Roku is focused on benefiting from its ongoing shift to streaming. Available from the Roku Home Screen Menu, the Roku Sports Zone organizes sports programming in a single location, and its features are integrated throughout the Roku Experience.
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The content row has helped us drive growth in Streaming Hours, ad reach, and SVOD signups, including Premium Subscriptions within The Roku Channel. The Roku Experience also includes destinations such as our Sports Experience, which aggregates and organizes sports programming from across our platform into a single location.
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We partnered with the NFL to launch our first league-branded zone in 2023, and in 2024 we added zones for the NBA and MLB. We also have zones for college football, college basketball, and women’s sports, among others. Each zone helps viewers find live and upcoming games and related content such as previews, highlights, commentary, and documentaries.
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Owned and Operated Streaming Apps In 2025, we expanded our portfolio of owned and operated streaming apps beyond The Roku Channel to Howdy, an ad-free SVOD service, and Frndly TV, a subscription streaming service that offers live TV, on-demand video, and a cloud-based digital video recorder (“DVR”).
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In addition to sports, we build viewer experiences around popular entertainment genres like home improvement and food and tentpole events like the Olympics and the Oscars. The Roku Channel Another top engagement driver on our streaming platform is The Roku Channel, our owned and operated streaming app.
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With both Howdy and Frndly TV, we believe our expertise in recommending relevant content to viewers and leveraging the power of our platform will drive cost-efficient subscription sign-ups and engagement, thus adding incremental Platform revenue.
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We also have partnerships with companies such as iSpot.TV that allow advertisers to buy, optimize, and measure their campaigns, whether directly through Roku or through another buying platform.
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Our owned and operated streaming apps are strategic assets in our monetization efforts that simultaneously benefit viewers, content partners, and advertisers, while helping to grow and diversify our Platform revenue. The Roku Channel The Roku Channel is a top driver of engagement and ad inventory on our platform.
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On the Roku Home Screen, we recently enhanced our marquee ads from static display to video. This new video capability has attracted diverse brands and verticals such as tech, financial services, quick-service restaurants, retail, consumer packaged goods, and auto. This is part of our ongoing effort to diversify display ads on the Roku Home Screen beyond media and entertainment advertisers.
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The Roku Channel is available on devices powered by the Roku TV OS in the United States, the United Kingdom, Canada, and Mexico.
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We are working to offer video in the marquee ads to more brands, while continuing to deliver a delightful user experience.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisk Factors Summary Below is a summary of the principal factors that make an investment in our Class A common stock speculative or risky: Risks Related to Our Business and Industry • the highly competitive nature of the TV streaming industry that is rapidly evolving; • our ability to successfully grow revenues from advertising on our platform; • maintaining an adequate supply of quality video advertising inventory on our platform and effectively selling the available supply; • irrelevant or unengaging advertising campaigns on our streaming platform; • our ability to successfully utilize programmatic advertising technology; • advertiser or advertising agency delayed payment or failure to pay; • our ability to further monetize our streaming platform; • our ability to successfully operate and monetize The Roku Channel; • our ability to establish and maintain relationships with important content partners; • popular or new content publishers not publishing their content on our streaming platform; • the non-renewal or early termination of our agreements with content partners; • content partners electing not to participate in platform features that we develop; • users signing up for offerings and services outside of our platform; • our ability to develop, maintain, and expand relationships with licensed Roku TV partners and manufacturing partners; • our and our licensed Roku TV partners’ ability to develop, maintain, and expand relationships with important retail sales channels that we and they rely on to sell our streaming devices and other products; • our ability to build a strong brand and maintain customer satisfaction and loyalty; • our and our licensed Roku TV partners’ reliance on contract manufacturers and limited manufacturing capabilities; • our reliance on licensed Roku TV partners’ operations for the supply of Roku TV models; • our ability to accurately forecast manufacturing requirements and manage our supply chain and inventory levels; • decreased availability or increased costs for materials and components used in the manufacturing of our products and our licensed Roku TV partners’ products; • our ability to obtain key components from sole source suppliers; • interoperability of our products with content partners’ and other third parties’ offerings, technologies, and systems; • detecting hardware defects and software errors in our products before they are released to end users; • component manufacturing, design, or other defects that may render our products permanently inoperable; • our ability to obtain or maintain necessary or desirable licenses, certifications, or approvals related to our use or support of third-party technology, intellectual property, or services; • our introduction of new products and services; • our use of artificial intelligence (“AI”) technologies in some of our products and services; • maintaining adequate customer support levels; Risks Related to Operating and Growing Our Business • our history of operating losses; 9 Table of Contents • volatility of our quarterly operating results that could cause our stock price to decline; • our ability to manage our growth; • our ability to successfully expand our international operations; • seasonality and other potential fluctuations in our business and their impact on our revenue and gross profit; • attracting and retaining key personnel and managing succession; • maintaining systems that can support our growth, business arrangements, and financial rules; • our ability to successfully complete acquisitions and investments and integrate acquired businesses; • our ability to comply with the terms of our outstanding credit facility; • our ability to secure funds to meet our financial obligations and support our planned business growth; • adverse developments affecting financial institutions, including bank failures; • the impact of macroeconomic conditions, natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events on our business; Risks Related to Cybersecurity, Reliability, and Data Privacy • data security incidents, including cybersecurity attacks, or other significant disruptions of our information technology systems that could adversely affect our business and subject us to liability; • legal obligations and potential liability or reputational harm related to our collection, processing, disclosure, and storage of personal information; • disruptions in information technology systems or other services that result in a degradation of our platform; • changes in how network operators manage data that travel across their networks; Risks Related to Intellectual Property • intellectual property infringement claims and litigation resulting in significant costs or the loss of important intellectual property rights; • failure or inability to protect or enforce our intellectual property or proprietary rights; • our use of open-source software; • our agreements to indemnify certain of our partners if our technology is alleged to infringe on third parties’ intellectual property rights; Legal and Regulatory Risks • lawsuits and other legal proceedings, disputes, claims, and government inquiries and investigations; • enactment of or changes to government regulation or laws related to our business; • changes in U.S. or foreign trade policies, geopolitical conditions, and general economic conditions that impact our business; • U.S. or international rules (or the absence of rules) that permit internet access network operators to degrade users’ internet service speeds or limit internet data consumption by users; • liability for content that is distributed through or advertising that is served through our platform; • our ability to maintain effective internal controls over financial reporting; • the impact of changes in accounting principles; • compliance with laws and regulations related to the payment of income taxes and collection of indirect taxes; • changes to U.S. or foreign taxation laws or regulations; Risks Related to Ownership of Our Class A Common Stock • the dual class structure of our common stock; • volatility in the market price of our Class A common stock; • potential dilution or a decline in our stock price caused by future sales or issuance of our capital stock or rights to purchase capital stock; • a decline in our stock price caused by future sales by existing stockholders; • dependency on favorable securities and industry analyst reports; • the significant legal, accounting, and other expenses associated with being a publicly traded company; • the absence of dividends on our common stock; • anti-takeover provisions in our charter and bylaws; and • the limitations resulting from our selection of the Delaware Court of Chancery and the U.S. federal district courts as the exclusive forums for substantially all disputes between us and our stockholders. 10 Table of Contents Risks Related to Our Business and Industry If we fail to differentiate our streaming platform and compete successfully with our competitors, it will be difficult for us to attract and retain users and our business will be adversely impacted.
Biggest changeRisk Factors Summary Below is a summary of the principal factors that make an investment in our Class A common stock speculative or risky: Risks Related to Our Business and Industry • the highly competitive nature of the TV streaming industry that is rapidly evolving; • our ability to successfully grow revenues from advertising on our platform; 8 Table of Contents • maintaining an appropriate supply of quality video advertising inventory on our platform and effectively selling the available supply; • irrelevant or unengaging advertising campaigns on our streaming platform; • our ability to successfully utilize programmatic advertising technology; • our ability to further monetize our streaming platform; • our ability to successfully operate and monetize our owned and operated streaming services; • our ability to establish and maintain relationships with important content partners; • popular or new content publishers not publishing their content on our streaming platform; • the non-renewal or early termination of our agreements with content partners; • content partners electing not to participate in platform features that we develop; • users signing up for offerings and services outside of our platform; • our ability to develop, maintain, and expand relationships with licensed Roku TV partners and manufacturing partners; • our and our licensed Roku TV partners’ ability to develop, maintain, and expand relationships with important retail sales channels that we and they rely on to sell our streaming devices and other products; • our ability to build and maintain a strong brand and customer satisfaction and loyalty; • our and our licensed Roku TV partners’ reliance on contract manufacturers and ability to accurately forecast manufacturing requirements and manage supply chain and inventory levels; • decreased availability or increased costs for materials and components used in the manufacturing of our products and our licensed Roku TV partners’ products; • our ability to obtain key components from sole source suppliers; • interoperability of our products with content partners’ and other third parties’ offerings, technologies, and systems; • detecting hardware defects and software errors in our products before they are released to end users; • component manufacturing, design, or other defects that may render our products permanently inoperable; • our ability to obtain or maintain necessary or desirable licenses, certifications, or approvals related to our use or support of third-party technology, intellectual property, or services; • our introduction of new products and services; • our use of artificial intelligence (“AI”) technologies in some of our products and services; • maintaining adequate customer support levels; Risks Related to Operating and Growing Our Business • our history of operating losses; • volatility of our quarterly operating results that could cause our stock price to decline; • our ability to manage our growth; • our ability to successfully expand our international operations; • seasonality and other potential fluctuations in our business and their impact on our revenue and gross profit; • attracting and retaining key personnel and managing succession; • maintaining systems that can support our growth, business arrangements, and financial rules; • our ability to successfully complete acquisitions and strategic transactions and integrate acquired businesses; • our ability to comply with the terms of our outstanding credit facility; • our ability to secure funds to meet our financial obligations and support our planned business growth; • our uninsured cash deposits; • the impact of macroeconomic conditions, natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events on our business; Risks Related to Cybersecurity, Reliability, and Data Privacy • data security incidents, including cybersecurity attacks, or other significant disruptions of our information technology systems that could adversely affect our business and subject us to liability; • legal obligations and potential liability or reputational harm related to our collection, processing, disclosure, and storage of personal information; • disruptions in information technology systems or other services that result in a degradation of our platform; • changes in how network operators manage data that travel across their networks; 9 Table of Contents Risks Related to Intellectual Property • intellectual property infringement claims and litigation resulting in significant costs or the loss of important intellectual property rights; • failure or inability to protect or enforce our intellectual property or proprietary rights; • our use of open-source software; • our agreements to indemnify certain of our partners if our technology is alleged to infringe on third parties’ intellectual property rights; Legal and Regulatory Risks • lawsuits and other legal proceedings, disputes, claims, and government inquiries and investigations; • enactment of or changes to government regulation or laws related to our business; • changes in U.S. or foreign trade policies, geopolitical conditions, and general economic conditions that impact our business; • U.S. or international rules (or the absence of rules) that permit internet access network operators to degrade users’ internet service speeds or limit internet data consumption by users; • liability for content that is distributed through or advertising that is served through our platform; • our ability to maintain effective internal controls over financial reporting; • the impact of changes in accounting principles; • compliance with laws and regulations related to the payment of income taxes and collection of indirect taxes; • changes to U.S. or foreign taxation laws or regulations; Risks Related to Ownership of Our Class A Common Stock • the dual class structure of our common stock; • volatility in the market price of our Class A common stock; • potential dilution or a decline in our stock price caused by future sales or issuance of our capital stock or rights to purchase capital stock; • a decline in our stock price caused by future sales by existing stockholders; • the impact of our stock repurchase program; • dependency on favorable securities and industry analyst reports; • the significant legal, accounting, and other expenses associated with being a publicly traded company; • the absence of dividends on our common stock; • anti-takeover provisions in our charter and bylaws; and • the limitations resulting from our selection of the Delaware Court of Chancery and the U.S. federal district courts as the exclusive forums for substantially all disputes between us and our stockholders.
See also “ —If our efforts to build a strong brand and maintain customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed ” and “ —If we fail to differentiate our streaming platform and compete successfully with our competitors, it will be difficult for us to attract and retain users and our business will be adversely impacted. ” Any reduction in our ability to place and promote our products, or increased competition for available shelf or website placement, could require us to increase our marketing or other expenditures to maintain our product visibility or could result in reduced visibility for our products, which may harm our business.
See also “ —If our efforts to build and maintain a strong brand and customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed ” and “ —If we fail to differentiate our streaming platform and compete successfully with our competitors, it will be difficult for us to attract and retain users and our business will be adversely impacted. ” Any reduction in our ability to place and promote our products, or increased competition for available shelf or website placement, could require us to increase our marketing or other expenditures to maintain our product visibility or could result in reduced visibility for our products, which may harm our business.
Successfully building a brand is a time-consuming and comprehensive endeavor, and our brand may be negatively impacted by factors, some which are beyond our control, such as the quality and reliability of the Roku TV models made by our licensed Roku TV partners and the quality of the content provided by our content partners.
Successfully building a brand is a time-consuming and comprehensive endeavor, and our brand may be negatively impacted by factors, some of which are beyond our control, such as the quality and reliability of the Roku TV models made by our licensed Roku TV partners and the quality of the content provided by our content partners.
For example, if the tensions between Taiwan and China escalate and impact the operations of our contract manufacturers and their Taiwanese suppliers, our supply chain and our business could be adversely affected. We believe that the international location of these facilities increases supply risk, including the risk of supply interruptions, tariffs, and trade restrictions on exports or imports.
For example, if the tensions between Taiwan and China escalate and impact the operations of contract manufacturers and their Taiwanese suppliers, our supply chain and our business could be adversely affected. We believe that the international location of these facilities increases supply risk, including the risk of supply interruptions, tariffs, and trade restrictions on exports or imports.
These obligations create potential legal liability to regulators, our business partners, our users, and other stakeholders and impact the attractiveness of our services to existing and potential users.
These obligations create potential legal liability to regulators, our business partners, our users, and other stakeholders and impact the attractiveness of our services to existing and potential users.
We and our service providers and partners collect, process, transmit, disclose, and store personal information, which creates legal obligations and exposes us to potential liability. We and our service providers and partners collect, process, disclose, and store personal information of individuals.
We and our service providers and partners collect, process, transmit, disclose, and store personal information, which creates legal obligations and exposes us to potential liability. We and our service providers and partners collect, process, transmit, disclose, and store personal information of individuals.
Despite the cost and time we spend monitoring, we may or may not be able to detect infringement by third parties. Our competitive position may be harmed if we cannot detect infringement and enforce our intellectual property rights quickly or at all.
Despite the cost and time we spend monitoring, we may not be able to detect infringement by third parties. Our competitive position may be harmed if we cannot detect infringement and enforce our intellectual property rights quickly or at all.
The market price of our Class A common stock has been and may continue to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our financial condition, operating results, and key performance metrics; • changes in projected operational and financial results; • our loss of key content partners; • changes in laws or regulations applicable to our products or platform; • the commencement or conclusion of legal proceedings that involve us; • actual or anticipated changes in our growth rate relative to our competitors; • announcements of new products or services by us or our competitors; • announcements by us or our competitors of significant acquisitions, strategic partnerships, or joint ventures; • capital-raising activities or commitments; • additions or departures of key personnel; • issuance of new or updated research or reports by securities analysts; • the use by investors or analysts of third-party data regarding our business that may not reflect our financial performance; • fluctuations in the valuation of companies perceived by investors to be comparable to us; • the perception that our environmental, social, and corporate governance performance is inadequate compared to that of our competitors; • sales of our Class A common stock, including short selling of our Class A common stock; • share price and volume fluctuations attributable to inconsistent trading volume levels of our shares; • general economic and market conditions; and • other events or factors, including those resulting from civil unrest, war, foreign invasions, geopolitical tensions, terrorism, or public health crises, or responses to such events.
The market price of our Class A common stock has been and may continue to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our financial condition, operating results, and key performance metrics; • changes in projected operational and financial results; • our loss of key content partners; • changes in laws or regulations applicable to our products or platform; • the commencement or conclusion of legal proceedings that involve us; • actual or anticipated changes in our growth rate relative to our competitors; • announcements of new products or services by us or our competitors; • announcements by us or our competitors of significant acquisitions, strategic partnerships, or joint ventures; • capital-raising activities or commitments; • additions or departures of key personnel; • issuance of new or updated research or reports by securities analysts; 36 Table of Contents • the use by investors or analysts of third-party data regarding our business that may not reflect our financial performance; • fluctuations in the valuation of companies perceived by investors to be comparable to us; • the perception that our environmental, social, and corporate governance performance is inadequate compared to that of our competitors; • sales of our Class A common stock, including short selling of our Class A common stock; • share price and volume fluctuations attributable to inconsistent trading volume levels of our shares; • general economic and market conditions; and • other events or factors, including those resulting from civil unrest, war, foreign invasions, geopolitical tensions, terrorism, or public health crises, or responses to such events.
The extent to which macroeconomic uncertainties may impact our operational and financial performance is uncertain and will depend on many factors outside our control. These direct and indirect impacts may negatively affect our business and operating results. Natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events could disrupt and impact our business.
The extent to which macroeconomic uncertainties may impact our operational and financial performance is largely uncertain and will depend on many factors outside our control. These direct and indirect impacts may negatively affect our business and operating results. Natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events could disrupt and impact our business.
Furthermore, if we or the third parties that we work with are alleged to violate applicable laws, our contractual obligations, or our policies, our users could lose trust in us. Any decrease in user retention, growth, or engagement could render our products less attractive to users, advertisers, or partners, and would seriously harm our business.
Furthermore, if we or the vendors and third parties that we work with are alleged to violate applicable laws, our contractual obligations, or our policies, our users could lose trust in us. Any decrease in user retention, growth, or engagement could render our products less attractive to users, advertisers, or partners, and would seriously harm our business.
If the advertising campaigns run on our streaming platform are not relevant, are overly intrusive or too frequent, or are an impediment to the use of our platform, our viewers may stop using our platform, resulting in a reduction of our user base and Streaming Hours, which will harm our business, financial condition, and operating results.
If the advertising campaigns that run on our streaming platform are not relevant, are overly intrusive or too frequent, or are an impediment to the use of our platform, our viewers may stop using our platform, resulting in a reduction of our user base and Streaming Hours, which will harm our business, financial condition, and operating results.
The risk of harm to our business caused by security incidents may also increase as we expand our product and service offerings and as we enter new markets. Vulnerabilities can be, and have been, exploited from inadvertent or intentional actions of our employees, third-party vendors, business partners, or by malicious third parties.
The risk of harm to our business caused by security incidents may also increase as we expand our product and service offerings and as we enter new markets. Vulnerabilities can be, and have been, exploited from inadvertent or intentional actions of our employees, vendors, or business partners, or by malicious third parties.
The economic benefits that we derive from these license arrangements are and will likely continue to be indirect, primarily growth of our user base and increasing Streaming Hours, and both enabling us to generate more streaming services distribution and advertising-related revenue on our platform.
The economic benefits that we derive from these license arrangements are and will likely continue to be indirect, primarily growth of our user base and increasing Streaming Hours, and enabling us to generate more streaming services distribution and advertising-related revenue on our platform.
This multilateralism and collaboration among taxing authorities (including the U.S. and many foreign jurisdictions in which we operate) has resulted in proposed new tax measures specifically targeting online commerce, digital services, streaming services, and the remote sale of goods and services.
This multilateralism and collaboration among taxing authorities (including the U.S. and many foreign jurisdictions in which we operate) has resulted in proposed new tax measures specifically targeting online commerce, digital advertising and services, streaming services, and the remote sale of goods and services.
See also “ —If popular or new content publishers do not publish content on our streaming platform, we may fail to retain existing users and attract new users. ” The successful development and introduction of new products and services depends on a number of factors, including: • the accuracy of our forecasts for market requirements beyond near-term visibility; • our ability to anticipate and react to new technologies and evolving consumer trends; • our development, licensing, or acquisition of new technologies; • our timely completion of new designs and development; • our ability to timely and adequately redesign or resolve design or manufacturing or security issues; • our ability to identify and contract with appropriate manufacturers; • the ability of our contract manufacturers to cost-effectively manufacture our products, produce quality products, and minimize defects, manufacturing mishaps, shipping costs, and delays; • the availability of materials and key components used in manufacturing; • tariffs, trade, sanctions, and export restrictions by the U.S. or foreign governments; • our ability to comply with regulatory requirements; and • our ability to attract and retain high quality research and development personnel.
See also “ —If popular or new content publishers do not publish content on our streaming platform, we may fail to retain existing users and attract new users. ” The successful development and introduction of new products and services depends on a number of factors, including: • the accuracy of our forecasts for market requirements beyond near-term visibility; • our ability to anticipate and react to new technologies and evolving consumer trends; • our development, licensing, or acquisition of new technologies; • our timely completion of new designs and development; 19 Table of Contents • our ability to timely and adequately redesign or resolve design or manufacturing or security issues; • our ability to identify and contract with appropriate manufacturers; • the ability of our contract manufacturers to cost-effectively manufacture our products, produce quality products, and minimize defects, manufacturing mishaps, shipping costs, and delays; • the availability of materials and key components used in manufacturing; • tariffs, trade, sanctions, and export restrictions by the U.S. or foreign governments; • our ability to comply with regulatory requirements; and • our ability to attract and retain high quality research and development personnel.
In addition, many of those third parties in turn subcontract or outsource some of their responsibilities to third parties. As a result, our information technology systems, including the functions of third parties that are involved in or have access to those systems, are very large and complex.
In addition, many of those third parties in turn subcontract or outsource some of their responsibilities to other parties. As a result, our information technology systems, including the functions of other parties that are involved in or have access to those systems, are very large and complex.
See also “— We and our service providers and partners collect, process, disclose, and store personal information, which creates legal obligations and exposes us to potential liability .” Regulatory inquiries, investigations, and enforcement actions could also adversely impact our business operations.
See also “— We and our service providers and partners collect, process, transmit, disclose, and store personal information, which creates legal obligations and exposes us to potential liability .” Regulatory inquiries, investigations, and enforcement actions could also adversely impact our business operations.
We also rely upon our contract manufacturers and other contractors to perform some of the development work on our products. The contract manufacturers or other contractors may be unwilling or unable to successfully complete desired development or fix defects or errors in a timely manner.
We also rely on our contract manufacturers and other contractors to perform some of the development work on our products. The contract manufacturers or other contractors may be unwilling or unable to successfully complete desired development or fix defects or errors in a timely manner.
Delays in development work by contract manufacturers or contractors could delay launch of new or improved products. Our contracts with our contract manufacturers generally may not contain terms that protect us against development, manufacturing, and supply disruptions or risks.
Delays in development work by contract manufacturers or contractors could delay launch of new or improved products. Our contracts with our contract manufacturers generally may not contain terms that protect us against development, manufacturing, inventory, and supply disruptions or risks.
The non-renewal or early termination of agreements with our content partners may result in the removal of certain apps or app features from our streaming platform and harm our streaming device sales, user base growth, and engagement.
The non-renewal or early termination of agreements with our content partners may result in the removal of certain apps or app features from our streaming platform and harm our streaming device sales, user base growth, engagement, and monetization.
In the ordinary course of our business, we collect, store, process, and transmit large amounts of sensitive corporate, personal, and other information, including intellectual property, proprietary business information, user payment card information, user video and audio recordings, other user information, employee information, and other confidential information.
In the ordinary course of our business, we collect, store, process, and transmit large amounts of sensitive corporate, personal, and other information, including intellectual property, proprietary business information, user payment information, user video and audio recordings, other user information, employee information, and other confidential information.
See also “— If we are unable to maintain an adequate supply of quality video advertising inventory on our streaming platform or generate sufficient demand to effectively sell our available video advertising inventory, our business may be harmed .” If advertisers continue to devote a substantial portion of their advertising budgets to advertising in traditional media or on other digital platforms rather than on advertising on our streaming platform, the future growth of our business may be negatively impacted.
See also “— If we are unable to maintain an appropriate supply of quality video advertising inventory on our streaming platform or generate sufficient demand to effectively sell our available video advertising inventory, our business may be harmed .” If advertisers continue to devote a substantial portion of their advertising budgets to advertising in traditional media or on other digital platforms rather than on advertising on our streaming platform, the future growth of our business may be negatively impacted.
We utilize information technology systems located either in our facilities or those of third-party server hosting providers and third-party internet-based or cloud computing services. Although we generally enter into service level agreements with these parties, we exercise no control over their operations, which makes us vulnerable to any errors, interruptions, or delays that they may experience.
We utilize information technology systems located either in our facilities or those of server hosting providers and internet-based or cloud computing services. Although we generally enter into service level agreements with these parties, we exercise no control over their operations, which makes us vulnerable to any errors, interruptions, or delays that they may experience.
Upon the expiration or termination of any of our agreements with third-party vendors, we may not be able to replace their services in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete.
Upon the expiration or termination of any of our agreements with vendors, we may not be able to replace their services in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete.
Labor is subject to external factors that are beyond our control, including our industry’s highly competitive market for skilled workers and leaders, cost inflation, workforce participation rates, and unstable political conditions. Our employees, particularly engineers and other product developers, are in demand, and we devote significant resources to identifying, hiring, training, successfully integrating, and retaining these employees.
Labor is subject to external factors that are beyond our control, including our industry’s highly competitive market for skilled workers and leaders, cost inflation, workforce participation rates, immigration policies, and unstable political conditions. Our employees, particularly engineers and other product developers, are in demand, and we devote significant resources to identifying, hiring, training, successfully integrating, and retaining these employees.
Factors that may contribute to the variability of our operating results and cause the market price of our Class A common stock to fluctuate include: • the entrance of new competitors or competitive products or services; • our ability to retain and grow our user base, increase engagement among new and existing users, and monetize our streaming platform; • our ability to maintain effective pricing practices in response to competitive market conditions or other macroeconomic factors, such as increased taxes, inflation, or tariffs, and our ability to control costs, including our operating expenses; • our revenue mix, which drives gross profit; • supply of advertising inventory on our platform and advertiser demand for such inventory; • seasonal, cyclical, or other shifts in revenue from advertising or product sales; • the timing of the launch of new or updated products, apps, or features; • the addition or removal of content or apps from our streaming platform; • the expense and availability of content to license or produce for The Roku Channel; • the ability of retailers to anticipate consumer demand; • an increase in the manufacturing or component costs of our products or partner-branded products; • delays in delivery of our products or partner-branded products, or disruptions in our or our partners’ supply or distribution chains; and • an increase in legal costs, including costs associated with protecting our intellectual property, defending against intellectual property infringement allegations, or procuring rights to intellectual property.
Factors that may contribute to the variability of our operating results and cause the market price of our Class A common stock to fluctuate include: • the entrance of new competitors or competitive products or services; • our ability to retain and grow our user base, increase engagement among new and existing users, and monetize our streaming platform; • our ability to maintain effective pricing practices in response to competitive market conditions or other macroeconomic factors, such as increased or changing taxes, inflation, or tariffs, and our ability to control costs, including our operating expenses; • our revenue mix, which drives gross profit; • supply of advertising inventory on our platform and advertiser demand for such inventory; • seasonal, cyclical, or other shifts in revenue from advertising or product sales; • the timing of the launch of new or updated products, apps, or features; • the addition or removal of content or apps from our streaming platform; • the expense and availability of content to license or produce for our owned and operated streaming services; • the ability of retailers to anticipate consumer demand; • an increase in the manufacturing or component costs of our products or partner-branded products; • delays in delivery of our products or partner-branded products, or disruptions in our or our partners’ supply or distribution chains; and • an increase in legal costs, including costs associated with protecting our intellectual property, defending against intellectual property infringement allegations, or procuring rights to intellectual property.
Roku TV OS’s “Are you still watching?” feature, which prompts users to confirm they are still watching, does not resolve this lack of correlation.
The Roku TV OS’s “Are you still watching?” feature, which prompts users to confirm they are still watching, does not resolve this lack of correlation.
See also “ —If government regulations or laws relating to the internet, video, advertising, or other areas of our business change, we may need to alter the manner in which we conduct our business, or our business could be harmed. ” There can be no assurance that the measures we have taken to mitigate the potential risks related to generative AI will be sufficient.
See also “ —If government regulations or laws relating to the internet, video, advertising, or other areas of our business change, we may need to alter the manner in which we conduct our business, or our business could be harmed. ” There can be no assurance that the measures we have taken to mitigate the potential risks related to AI technologies will be sufficient.
See also “ —We may not be successful in our efforts to further monetize our expanding user base and streaming activity as we increase the amount of content offered and streamed across our platform, which may harm our business. ” The loss of a relationship with a licensed Roku TV partner (including as a result of our launch of Roku-branded TVs that are designed, made, and sold by us) could harm our results of operations, damage our reputation, increase pricing and promotional pressures from other partners and retail distribution channels, increase our marketing costs, and result in the loss of revenue.
See also “ —We may not be successful in our efforts to further monetize our expanding user base and streaming activity as we increase the amount of content offered and streamed across our platform, which may harm our business. ” The loss of a relationship with a licensed Roku TV partner (including as a result of our sales of Roku-made TVs that are designed, made, and sold by us) could harm our results of operations, damage our reputation, increase pricing and promotional pressures from other partners and retail distribution channels, increase our marketing costs, and result in the loss of revenue.
In addition, our contract manufacturers’ facilities, and the facilities of our contract manufacturers’ suppliers, are located in various geographic areas that may be subject to political, economic, labor, trade, public health, social, and legal uncertainties, including Taiwan, Vietnam, China, and Brazil, and such uncertainties may harm or disrupt our relationships with these parties or their ability to perform.
In addition, contract manufacturers’ facilities, and the facilities of contract manufacturers’ suppliers, are located in various geographic areas that may be subject to political, economic, labor, trade, public health, social, and legal uncertainties, including Brazil, China, Mexico, Taiwan, Thailand, and Vietnam, and such uncertainties may harm or disrupt our relationships with these parties or their ability to perform.
We anticipate that such impact on revenue and gross profit is likely to continue, and any shortfall in expected fourth quarter revenue due to a decline in the effectiveness of our promotional activities, actions by our competitors, reductions in consumer discretionary spending, curtailed advertising spending, disruptions in our supply or distribution chains, tariffs or other restrictions on trade, increased shipping costs, 24 Table of Contents shipping or air freight delays, or for any other reason, would cause our full year results of operations to suffer significantly.
We anticipate that such impact on revenue and gross profit is likely to continue, and any shortfall in expected fourth quarter revenue due to a decline in the effectiveness of our promotional activities, actions by our competitors, reductions in consumer discretionary spending, curtailed advertising spending, disruptions in our supply or distribution chains, tariffs or other restrictions on trade, increased shipping costs, shipping or air freight delays, or for any other reason, would cause our full year results of operations to suffer significantly.
If we are unable to renew such agreements on a timely basis on mutually agreeable terms, or if a content partner terminates an agreement with us prior to its expiration, we may be required to temporarily or permanently remove certain apps or app features from our streaming platform.
If we are unable to renew such agreements on a timely basis on mutually agreeable terms, or if a content partner terminates an agreement with us before its expiration, we may be required to temporarily or permanently remove certain apps or app features from our streaming platform.
In addition, our entrance into entirely new lines of business beyond our historical core business of TV streaming and advertising, such as our Roku-branded smart home products, may change our risk profile and subject us to risks that differ from the risks we face as a result of our historical TV streaming business.
In addition, our entrance into entirely new lines of business beyond our historical core business of TV streaming and advertising, such as our smart home products, may change our risk profile and subject us to risks that differ from the risks we face as a result of our historical TV streaming business.
Although we have implemented work from home protocols, the actions of our employees while working from home may have a greater effect on the security of our systems and the data we process, including by increasing the risk of compromise to our systems, intellectual property, or data arising from employees’ combined use of personal and private devices, accessing our systems or data using wireless networks that we do not control, or the ability to transmit or store company-controlled data outside of our secured network.
Although we have implemented work from home protocols, the actions of our employees while working from home may have a greater effect on the security of our systems and the data we process, including by increasing the risk of compromise to our systems, intellectual property, or data arising from employees’ combined use of personal and private 27 Table of Contents devices, accessing our systems or data using wireless networks that we do not control, or the ability to transmit or store company-controlled data outside of our secured network.
Risks Related to Ownership of Our Class A Common Stock The dual class structure of our common stock concentrates voting control with those stockholders who held our stock prior to our initial public offering, including our executive officers, employees, and directors and their affiliates, and limits the ability of holders of our Class A common stock to influence corporate matters.
Risks Related to Ownership of Our Class A Common Stock The dual class structure of our common stock concentrates voting control with those stockholders who held our stock before our initial public offering, including our executive officers, employees, and directors and their affiliates, and limits the ability of holders of our Class A common stock to influence corporate matters.
In addition, each U.S. state and most U.S. territories, each EU member state, and the United Kingdom, as well as many other foreign nations, have passed laws requiring notification to regulatory authorities, affected users, or others within a specific timeframe when there has been a security breach involving, or other unauthorized access to or acquisition or disclosure of, certain personal information and impose additional obligations on companies.
In addition, each U.S. state and most U.S. territories, each EU member state, and the United Kingdom, as well as many other foreign nations, have passed laws requiring notification to regulatory authorities, affected users, or others 26 Table of Contents within a specific timeframe when there has been a security breach involving, or other unauthorized access to or acquisition or disclosure of, certain personal information and impose additional obligations on companies.
Significant disruptions of our third-party vendors’ or commercial partners’ information technology systems or other similar data security incidents could also adversely affect our business operations or result in the loss, misappropriation, or unauthorized access, use or disclosure of, or the prevention of access to, sensitive or personal information, which could harm our business.
Significant disruptions of our vendors’ or commercial partners’ information technology systems or other similar data security incidents could also adversely affect our business operations or result in the loss, misappropriation, or unauthorized access, use or disclosure of, or the prevention of access to, sensitive or personal information, which could harm our business.
In such event, we could be required to make portions of our proprietary software generally available under similar open-source software license terms to third parties, including competitors, at low or no cost, to seek licenses from third parties in order to continue offering our products, to re-engineer our products, or to discontinue the sale of our products in the event re-engineering cannot be accomplished on a timely basis or at all, any of which could harm our business.
In such event, we could be required to make portions of our proprietary software generally available under similar open-source software license terms to third 31 Table of Contents parties, including competitors, at low or no cost, to seek licenses from third parties in order to continue offering our products, to re-engineer our products, or to discontinue the sale of our products in the event re-engineering cannot be accomplished on a timely basis or at all, any of which could harm our business.
We are subject to or affected by general business regulations and laws, as well as regulations and laws specific to the internet and online services, including laws and regulations related to data privacy and security, consumer protection, child and youth protection, data localization, encryption, telecommunications, social media, payment processing, subscriptions, taxation, trade, intellectual property, competition, electronic contracts, internet access, net neutrality, advertising, calling and texting, content restrictions, protection of minors, and accessibility, among others.
We are subject to or affected by general business regulations and laws, as well as regulations and laws specific to the internet and online services, including laws and regulations related to data privacy and security, consumer protection, child and youth protection, data localization, encryption, telecommunications, social media, payment processing, subscriptions, taxation, trade, intellectual property, competition, electronic contracts, internet access, net neutrality, advertising, calling and texting, content restrictions, AI, and accessibility, among others.
The laws and regulations governing the withholding and payment of income taxes and the collection of indirect taxes are numerous, complex, and vary by jurisdiction.
The laws and regulations governing the withholding and payment of income taxes and the collection of indirect taxes are numerous, complex, evolving, and vary by jurisdiction.
We have no minimum purchase commitments or long-term contracts with any of these retailers or distributors, and there can be no assurance that we will reach agreements with our retailers and distributors on terms we find acceptable or that will be consistent with our past practices. We may be reliant on certain retailers or distributors.
We have no minimum purchase commitments or long-term contracts with any of these retailers or distributors, and there can be no assurance that we will reach agreements with our retailers and distributors on terms we find acceptable or that will be consistent with our past practices. We are reliant on certain retailers or distributors.
See also “ —We may be unable to successfully expand our international operations, and our international expansion plans, if implemented, will subject us to a variety of risks that may harm our business .” 16 Table of Contents Our retailers and distributors also sell products that compete with our products and our licensed Roku TV partners’ products, including house-branded televisions sold by such retailers that utilize TV operating systems other than the Roku TV OS.
See also “ —We may be unable to successfully expand our international operations, and our international expansion plans, if implemented, will subject us to a variety of risks that may harm our business .” Our retailers and distributors also sell products that compete with our products and our licensed Roku TV partners’ products, including house-branded televisions sold by such retailers that utilize TV operating systems other than the Roku TV OS.
If we are unable to obtain or maintain necessary third-party licenses, certifications, or approvals, we may have to obtain substitute technologies, intellectual property, or services with lower 20 Table of Contents quality or performance standards, or at a greater cost, or remove desired functions and features from our products and services, any of which could harm customer and partner relationships, as well as the competitiveness of our products, services, and business.
If we are unable to obtain or maintain necessary third-party licenses, certifications, or approvals, we may have to obtain substitute technologies, intellectual property, or services with lower quality or performance standards, or at a greater cost, or remove desired functions and features from our products and services, any of which could harm customer and partner relationships, as well as the competitiveness of our products, services, and business.
Our historical growth has placed, and any future growth will continue to place, significant demands on our management, as well as our financial and operational resources, to: • manage a larger organization; • hire more employees, including engineers with relevant skills and experience; • expand internationally; • increase our sales and marketing efforts; • expand the capacity to manufacture and distribute our products; • broaden our customer support capabilities; • expand our product offerings; • support our licensed Roku TV partners; • expand and improve the content offering on our streaming platform; • implement appropriate operational and financial systems; and • maintain effective financial disclosure controls and procedures.
Our historical growth has placed, and any future growth will continue to place, significant demands on our management, as well as our financial and operational resources, to: • manage a larger organization; • hire more employees, including engineers with relevant skills and experience; • expand internationally; • increase our sales and marketing efforts; • expand the capacity to manufacture and distribute our products; • broaden our customer support capabilities; • expand our product offerings; • support our licensed Roku TV partners; • expand and improve the content offering on our streaming platform; 21 Table of Contents • implement appropriate operational and financial systems; and • maintain effective financial disclosure controls and procedures.
As we are still a recent entrant in international markets, we may not have established a strong reputation or relationships with retailers for those markets as compared to our retail sales channels in the United States or our competitors in international markets.
As we are still a relatively recent entrant in certain international markets, we may not have established a strong reputation or relationships with retailers for those markets as compared to our retail sales channels in the United States or our competitors in international markets.
Foreign Corrupt Practices Act, UK Bribery Act, and other anti-corruption laws, U.S. or foreign export controls and sanctions, and local laws requiring the maintenance of accurate books and records and a system of sufficient internal controls; • slower consumer adoption and acceptance of streaming devices and services in other countries; • different or unique competitive pressures, including as a result of competition with other devices that consumers may use to stream TV or existing local traditional TV services and products, including those provided by incumbent TV service providers and local consumer electronics companies; • greater difficulty supporting and localizing Roku streaming devices and our streaming platform, including delivering support and training documentation in languages other than English; • our ability to deliver or provide access to popular streaming apps or content to users in certain international markets; • availability of reliable broadband connectivity in areas targeted for expansion; • challenges and costs associated with staffing and managing foreign operations; • differing legal and court systems, including limited or unfavorable intellectual property protection; • unstable political and economic conditions, social unrest, or economic instability, including due to pandemics, natural disasters, wars, terrorist activity, foreign invasions (such as the Russian invasion of Ukraine), tariffs, trade disputes, local or global recessions, diplomatic or economic tensions (such as the tension between China and Taiwan and the tension in the Middle East), long-term environmental risks, or climate change; • adverse tax consequences, such as those related to changes in tax laws (including increased tax rates, the imposition of digital services taxes, and the adoption of global corporate minimum taxes and anti-base-erosion rules), changes in the interpretation of existing tax laws, and the heightened scrutiny by tax administrators of companies that have cross-border business activities; • the imposition of customs duties on cross-border data flows for streaming services, such as in the event that the World Trade Organization (WTO) fails to extend the current moratorium on such duties or the moratorium is applied only among WTO member states that support a new e-commerce agreement; • pandemics or epidemics, which could result in decreased economic activity in certain markets, changes in the use of our products or platform, or decreased ability to import, export, ship, or sell our products to supply such services to existing or new customers in international markets; • inflationary pressures, which may increase costs for materials, supplies, and services; • fluctuations in currency exchange rates, which could impact the revenue and expenses of our international operations and expose us to foreign currency exchange rate risk (see the section titled “Foreign Currency Exchange Rate Risk” in Part II, Item 7A of this Annual Report); • restrictions on the repatriation of earnings from certain jurisdictions; and • working capital constraints.
Foreign Corrupt Practices Act, UK Bribery Act, and other anti-corruption laws, U.S. or foreign export controls and sanctions, and local laws requiring the maintenance of accurate books and records and a system of sufficient internal controls; • slower consumer adoption and acceptance of streaming devices and services in other countries; • different or unique competitive pressures, including as a result of competition with other devices that consumers may use to stream TV or existing local traditional TV services and products, including those provided by incumbent TV service providers and local consumer electronics companies; • greater difficulty supporting and localizing Roku streaming devices and our streaming platform, including delivering support and training documentation in languages other than English; • our ability to deliver or provide access to popular streaming apps or content to users in certain international markets; • availability of reliable broadband connectivity in areas targeted for expansion; • challenges and costs associated with staffing and managing foreign operations; • differing legal and court systems, including limited or unfavorable intellectual property protection; • unstable political and economic conditions, social unrest, or economic instability, including due to pandemics, natural disasters, wars, terrorist activity, foreign invasions, tariffs, trade disputes, local or global recessions, diplomatic or economic tensions (such as the tension between China and Taiwan and the conflicts in the Middle East), long-term environmental risks, or climate change; • adverse tax consequences, such as those related to changes in tax laws (including increased tax rates, the imposition of digital services taxes, and the adoption of global corporate minimum taxes and anti-base-erosion rules), changes in the interpretation of existing tax laws, and the heightened scrutiny by tax administrators of companies that have cross-border business activities; • the imposition of customs duties on cross-border data flows for streaming services, such as in the event that the World Trade Organization (“WTO”) fails to extend the current moratorium on such duties or the moratorium is applied only among WTO member states that support a new e-commerce agreement; • inflationary pressures, which may increase costs for materials, supplies, and services; 22 Table of Contents • fluctuations in currency exchange rates, which could impact the revenue and expenses of our international operations and expose us to foreign currency exchange rate risk (see the section titled “Foreign Currency Exchange Rate Risk” in Part II, Item 7A of this Annual Report); • restrictions on the repatriation of earnings from certain jurisdictions; and • working capital constraints.
The Credit Agreement contains financial covenants requiring the maintenance of a minimum interest coverage ratio and a maximum total net leverage ratio, as well as customary events of default, the occurrence of which could result in amounts borrowed under the Credit Agreement becoming due and payable and remaining commitments terminated prior to the initial termination date on September 16, 2029.
The Credit Agreement contains financial covenants requiring the maintenance of a minimum interest coverage ratio and a maximum total net leverage ratio, as well as customary events of default, the occurrence of which could result in amounts borrowed under the Credit Agreement becoming due and payable and remaining commitments terminated before the initial termination date on September 16, 2029.
Open-source software, which may be incorporated into our systems or products, inherently presents a large attack surface and may contain vulnerabilities of which we are not aware and which we cannot control or 28 Table of Contents fully mitigate. Moreover, AI technologies may be used to implement certain cybersecurity attacks or to increase their intensity, which may further increase risk.
Open-source software, which may be incorporated into our systems or products, inherently presents a large attack surface and may contain vulnerabilities of which we are not aware and which we cannot control or fully mitigate. Moreover, AI technologies may be used to implement certain cybersecurity attacks or to increase their intensity, which may further increase risk.
Actions of our retailers and partners are not within our complete control, and our products could be re-exported to sanctioned persons or countries or provided by our retailers to third persons in contravention of our requirements or instructions or the laws.
Actions of our retailers and partners are not within our complete control, and our products could be re-exported to sanctioned persons or countries or provided by our retailers to third persons in contravention of our requirements or instructions or applicable laws.
In some circumstances, we may choose to not pursue enforcement because an infringer has a dominant intellectual property position or for other business reasons. 32 Table of Contents Litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets, or determine the validity and scope of proprietary rights claimed by others.
In some circumstances, we may choose to not pursue enforcement because an infringer has a dominant intellectual property position or for other business reasons. Litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets, or determine the validity and scope of proprietary rights claimed by others.
We have no control over these offerings, technologies, and systems beyond our app certification requirements, and if Roku streaming devices do not provide our users with a high-quality experience on those offerings on a cost-effective basis or if changes are made to those offerings that are not compatible 19 Table of Contents with Roku streaming devices, we may be unable to increase user base growth and user engagement or may be required to increase our hardware costs, and our business will be harmed.
We have no control over these offerings, technologies, and systems beyond our app certification requirements, and if Roku streaming devices do not provide our users with a high-quality experience on those offerings on a cost-effective basis or if changes are made to those offerings that are not compatible with Roku streaming devices, we may be unable to increase user base growth and user engagement or may be required to increase our hardware costs, and our business will be harmed.
In addition, any lawsuits regarding intellectual property rights, regardless of their success, could be expensive to resolve and would divert the time and attention of our management and technical personnel. 31 Table of Contents If we fail to, or are unable to, protect or enforce our intellectual property or proprietary rights, our business and operating results could be harmed.
In addition, any lawsuits regarding intellectual property rights, regardless of their success, could be expensive to resolve and would divert the time and attention of our management and technical personnel. If we fail to, or are unable to, protect or enforce our intellectual property or proprietary rights, our business and operating results could be harmed.
If our streaming platform was to fail or be negatively impacted as a result of a natural disaster or other event, our ability to deliver streaming content, including advertising, to our users would be impaired.
If our streaming platform were to fail or be negatively impacted as a result of a natural disaster or other event, our ability to deliver streaming content, including advertising, to our users would be impaired.
We are continuing to assess the impact of new and proposed privacy and data protection laws on our business. Any significant disruption in our information technology systems or those of third parties we utilize in our operations could result in a loss or degradation of service on our platform and could harm our business.
We are continuing to assess the impact of new and proposed privacy and data protection laws on our business. 28 Table of Contents Any significant disruption in our information technology systems or those of third parties we utilize in our operations could result in a loss or degradation of service on our platform and could harm our business.
Any of these factors could materially and adversely affect our business, financial condition, and results of operations. 33 Table of Contents If government regulations or laws relating to the internet, video, advertising, or other areas of our business change, we may need to alter the manner in which we conduct our business, or our business could be harmed.
Any of these factors could materially and adversely affect our business, financial condition, and results of operations. If government regulations or laws relating to the internet, video, advertising, or other areas of our business change, we may need to alter the manner in which we conduct our business, or our business could be harmed.
If the advertising campaigns that run on our streaming platform decrease or are not relevant or not engaging to our users, our business may be adversely impacted. We have made, and are continuing to make, investments to engage with more advertisers and content partners, and enable them to deliver more relevant advertising campaigns to our viewers.
If the advertising campaigns that run on our streaming platform decrease or are not relevant or not engaging to our users, our business may be harmed. We have made, and are continuing to make, investments to engage with more advertisers and content partners, and enable them to deliver more relevant advertising campaigns to our viewers.
See “ —If our users sign up for offerings and services outside of our streaming platform or through other apps on our streaming platform, our business may be harmed. ” We depend on a small number of content partners for a majority of our Streaming Hours, and if we fail to maintain these relationships, our business could be harmed.
See “ —If our users sign up for offerings and services outside of our streaming platform or through other apps on our streaming platform, our business may be harmed. ” We depend on a small number of content partners for nearly half of our Streaming Hours, and if we fail to maintain these relationships, our business could be harmed.
Changes in our products or future changes in export and import regulations may create delays in the introduction of our products in international markets, disrupt supply chains, prevent our commercial or strategic partners with international operations from deploying our products globally, or, in some cases, prevent the export or import of our products to certain countries, governments, or persons altogether.
Changes in our products or future changes in export and import regulations may create delays in the introduction of our products in international markets, disrupt supply chains, prevent our commercial or strategic partners with international operations from deploying our products globally, or, in some cases, prevent the export or import of our products to 33 Table of Contents certain countries, governments, or persons altogether.
We have not elected to take advantage of the “controlled company” exemption to the corporate governance rules for companies listed on The Nasdaq Global Select Market. 37 Table of Contents The market price of our Class A common stock has been, and may continue to be, volatile, and the value of our Class A common stock may decline.
We have not elected to take advantage of the “controlled company” exemption to the corporate governance rules for companies listed on The Nasdaq Global Select Market. The market price of our Class A common stock has been, and may continue to be, volatile, and the value of our Class A common stock may decline.
For example, we and other companies in the media, entertainment, and advertising technology industries have been subject to government inquiries and investigations by regulatory bodies with regard to our compliance with privacy and data security laws, the Federal Trade Commission Act, and other applicable laws and regulations.
For example, we and other companies in the media, entertainment, and advertising technology industries have been subject to government inquiries and investigations by regulatory bodies with regard to our compliance with privacy and data security laws, the Federal Trade Commission Act, state consumer protection laws, and other applicable laws and regulations.
For example, if our streaming player is connected to a TV, and the viewer turns off the TV, steps 13 Table of Contents away, or falls asleep without stopping or pausing the player, then a particular streaming app may continue to play content for a period of time determined by the streaming app.
For example, if our streaming player is connected to a TV, and the viewer turns off the TV, steps away, or falls asleep without stopping or pausing the player, then a particular streaming app may continue to play content for a period of time determined by the streaming app.
If our efforts to build a strong brand and maintain customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed. Building and maintaining a strong brand is important to attract and retain users, as potential users have a number of TV streaming choices.
If our efforts to build and maintain a strong brand and customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed. Building and maintaining a strong brand is important to attract and retain users, as potential users have many TV streaming choices.
We are subject to requirements to deduct or withhold income taxes on revenue sourced in various jurisdictions, pay income taxes on profits earned by any permanent establishment (or similar enterprise) of ours that carries on 36 Table of Contents business in various jurisdictions, and collect indirect taxes from our sales in various jurisdictions.
We are subject to requirements to deduct or withhold income taxes on revenue sourced in various jurisdictions, pay income taxes on profits earned by any permanent establishment (or similar enterprise) of ours that carries on business in various jurisdictions, and collect indirect taxes from our sales in various jurisdictions.
We generate platform revenue primarily from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls).
We generate Platform revenue from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, the sale of owned and operated subscription services, and the sale of branded app buttons on remote controls).
If we were to violate such restrictive covenants, we could incur penalties, increased expenses, and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business. 26 Table of Contents Our Credit Agreement matures on September 16, 2029.
If we were to violate such restrictive covenants, we could incur penalties, increased expenses, and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business. Our Credit Agreement matures on September 16, 2029.
If we are unable to maintain an adequate supply of quality video advertising inventory on our streaming platform or generate sufficient demand to effectively sell our available video advertising inventory, our business may be harmed. Our business model depends on our ability to grow video advertising inventory on our streaming platform and sell it to advertisers.
If we are unable to maintain an appropriate supply of quality video advertising inventory on our streaming platform or generate sufficient demand to effectively sell our available video advertising inventory, our business may be harmed. Our business model depends on our ability to maintain an appropriate supply of video advertising inventory on our streaming platform and sell it to advertisers.
In addition, we may face challenges in successfully deploying our three-phased business model—grow scale, grow engagement, and grow monetization—in international markets. Even if we are able to increase our user base in international markets, we may be unable to effectively grow our Streaming Hours or monetize user activity in those markets.
In addition, we may face challenges in successfully deploying our three-phased business model—scale, engagement, and monetization—in international markets. Even if we successfully grow our user base in international markets, we may be unable to effectively grow our Streaming Hours or monetize user activity in those markets.
Moreover, if the rules around these statutes and doctrines change, if international jurisdictions refuse to apply similar protections, or if a court were to disagree with our application of those rules to our business, we could incur liabilities and our business could be harmed.
Moreover, if the rules around these statutes and doctrines change, if international jurisdictions refuse to apply similar protections, or if a court were to disagree with our application of those rules to our business, we could incur 34 Table of Contents liabilities and our business could be harmed.
Our revenue, gross profit, key performance metrics, and other operating results could vary significantly from quarter-to-quarter and year-to-year and may fail to match our past performance due to a variety of factors, including many factors that are outside of our control.
Our revenue, gross profit, key performance metrics, and other operating results could vary significantly from quarter-to-quarter and year-to-year and may fail to match our past performance due to a variety of factors, including 20 Table of Contents many factors that are outside of our control.
For example, in California, increasing intensity of 27 Table of Contents drought and annual periods of wildfire danger increase the probability of planned power outages. Further, acts of terrorism could cause disruptions to the internet or the economy as a whole.
For example, in California, increasing intensity of drought and annual periods of wildfire danger increase the probability of planned power outages. Further, acts of terrorism could cause disruptions to the internet or the economy as a whole.
In those markets where regulatory safeguards against unreasonable 35 Table of Contents discrimination are nascent or non-existent and where local network operators possess substantial market power, we could experience anti-competitive practices that could impede our growth, cause us to incur additional expenses, or otherwise harm our business.
In those markets where regulatory safeguards against unreasonable discrimination are nascent or non-existent and where local network operators possess substantial market power, we could experience anti-competitive practices that could impede our growth, cause us to incur additional expenses, or otherwise harm our business.
Although this approach allows us to maximize product performance on lower cost hardware, reduce engineering development and qualification costs, and develop stronger relationships with our strategic suppliers, this also creates supply chain risk.
Although this approach allows us to maximize product performance on lower cost hardware, reduce engineering development and qualification costs, and develop stronger relationships with our strategic suppliers, this also creates supply chain and pricing risks.
For more information, see Note 17 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report.
For more information, see Note 18 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report.
These competitors could also implement standards or technology that are not compatible with our products or that provide a better streaming experience and have greater resources to more aggressively promote their brands through advertising than we do.
These competitors could also implement standards or technology that are not compatible with our 10 Table of Contents products or that provide a better streaming experience and have greater resources to more aggressively promote their brands through advertising than we do.
We may pursue acquisitions involving a number of risks, which could harm our business if not successfully addressed. We have acquired, and may in the future acquire, businesses, products, or technologies to expand our offerings and capabilities, user base, and business.
We may pursue acquisitions and other strategic transactions involving a number of risks, which could harm our business if not successfully addressed. We have acquired, and may in the future acquire, businesses, products, technologies, or other assets to expand our offerings and capabilities, user base, and business.
Amazon, Best Buy, Target, and Walmart in total accounted for 81% and 76% of our devices revenue for the years ended December 31, 2024 and 2023, respectively. Furthermore, our licensed Roku TV partners may be reliant on the same or other retailers and distributors for a significant portion of their unit sales of Roku TV models.
Amazon, Best Buy, Target, and Walmart in total accounted for 81% of our Devices revenue for each of the years ended December 31, 2025 and 2024. Furthermore, our licensed Roku TV partners may be reliant on the same or other retailers and distributors for a significant portion of their unit sales of Roku TV models.
Delays, component shortages, quality issues, and other manufacturing and supply problems in the past have impaired, and could in the future impair, the retail distribution of our products and ultimately our brand. Furthermore, any adverse change in our contract manufacturers’ financial or business condition could disrupt our ability to supply our products to our retailers and distributors.
Delays, component shortages, quality issues, and other manufacturing and supply problems in the past have impaired, and could in the future impair, the retail distribution of our products (including Roku TV models) and ultimately our brand. Furthermore, any adverse change in contract manufacturers’ financial or business condition could disrupt the supply of products to retailers and distributors.
For example, some content partners have elected not to participate in new Roku Home Screen Menu features or in our Roku Zones (collections of related content from apps across our streaming platform) or have imposed limits on our data gathering for usage within their apps.
For example, some content partners have elected not to participate in new Roku Home Screen Menu features (such as “What to Watch”) or in our Roku Zones (collections of related content across our streaming platform) or have imposed limits on our data gathering for usage within their apps.
Our contract manufacturers are vulnerable to, among other issues: • capacity constraints; • reduced component availability; 17 Table of Contents • production, supply chain, or shipping disruptions, delays, or increased costs, including from labor disputes, strikes, mechanical issues, quality control issues, natural disasters, geopolitical conflicts, and public health crises; and • the impact of U.S. or foreign tariffs, trade, or sanctions restrictions on components, finished goods, software, other products, or data transfers.
Contract manufacturers are vulnerable to, among other issues: capacity constraints; reduced component availability; production, supply chain, or shipping disruptions, delays, or increased costs, including from labor disputes, strikes, mechanical issues, quality control issues, natural disasters, geopolitical conflicts, and public health crises; and the impact of existing and evolving U.S. or foreign tariffs, trade policies and regulations, or sanctions restrictions on components, finished goods, software, other products, or data transfers.
We are incorporating AI technologies into some of our products and services, which may present operational and reputational risks. We have incorporated and intend to continue to incorporate AI technologies, such as generative AI, into our products and services.
We are incorporating AI technologies into some of our products and services, which may present operational, legal, and reputational risks. We have incorporated and intend to continue to incorporate AI technologies, such as machine learning and generative AI, into our operations, products, and services.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeKey components of our cybersecurity program include: • managing cybersecurity threats by deploying technical safeguards that are designed to protect our information systems from cybersecurity threats, which we evaluate and seek to improve, including through vulnerability assessments and cybersecurity threat intelligence; • maintaining cybersecurity incident management procedures to address incident reporting, classification, escalation, response, and recovery, and facilitate efficient and consistent management of cybersecurity incidents involving our information systems; • assessing and testing our cybersecurity policies and practices via internal efforts (such as assessments, vulnerability testing, threat modeling, tabletop exercises, and other exercises focused on evaluating the effectiveness of our cybersecurity measures) and by engaging third parties (including cybersecurity consulting firms) to perform assessments of our cybersecurity measures and manage our bug bounty program; 40 Table of Contents • a cybersecurity risk management process for third-party vendors, including, among other things, a security assessment and contracting process for vendor applications and implementing contractual security measures with third-party vendors; and • cybersecurity awareness training is available for all employees and enhanced training is provided for certain employees.
Biggest changeKey components of our cybersecurity program include: • managing cybersecurity threats by deploying technical safeguards that are designed to protect our information systems from cybersecurity threats, which we evaluate and seek to improve, including through vulnerability assessments and cybersecurity threat intelligence; • maintaining cybersecurity incident management procedures to address incident reporting, classification, escalation, response, and recovery, and facilitate efficient and consistent management of cybersecurity events involving our information systems; • assessing and testing our cybersecurity policies and practices via internal efforts (such as assessments, vulnerability testing, threat modeling, tabletop exercises, and other exercises focused on evaluating the effectiveness of our cybersecurity measures) and by engaging third parties (including cybersecurity consulting firms) to perform assessments of our cybersecurity measures and manage our bug bounty program; • a cybersecurity risk management process for third-party vendors, including, among other things, a security assessment and contracting process for vendor applications and implementing contractual security measures with third-party vendors; and • cybersecurity awareness training is available for all employees and enhanced training is provided for certain employees. 39 Table of Contents Cybersecurity Governance As part of its broader risk oversight activities, the Board oversees risks from cybersecurity threats, primarily through delegation to the Audit Committee.
The Audit Committee engages on cybersecurity matters with our management team, including our Vice President of Product and Enterprise Security, who regularly provides presentations to the Audit Committee on our cybersecurity governance and compliance programs.
As reflected in its charter, the Audit Committee assists the Board in reviewing our significant cybersecurity matters and concerns. The Audit Committee engages on cybersecurity matters with our management team, including our Vice President of Product and Enterprise Security, who regularly provides presentations to the Audit Committee on our cybersecurity governance and compliance programs.
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Cybersecurity Governance As part of its broader risk oversight activities, the Board oversees risks from cybersecurity threats, primarily through delegation to the Audit Committee. As reflected in its charter, the Audit Committee assists the Board in reviewing our significant cybersecurity matters and concerns.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe that our facilities are suitable to meet our current needs. PART II
Biggest changeWe believe that our facilities are suitable to meet our current needs.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe stockholder return shown on the graph below is not necessarily indicative of future performance, and we do not make or endorse any predictions as to future stockholder returns. 42 Table of Contents Company / Index Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Dec-24 Roku, Inc. $100 $248 $170 $30 $68 $56 Nasdaq Composite Index $100 $145 $177 $119 $173 $224 Peer Group $100 $136 $181 $95 $167 $243 Source: Prepared by Zacks Investment Research, Inc.
Biggest changeThe stockholder return shown on the graph below is not necessarily indicative of future performance, and we do not make or endorse any predictions as to future stockholder returns.
The ac tual number of stockholders of our Class A common stock is greater than the number of record holders and includes stockholders who are beneficial owners but whose shares of Class A common stock are held in street name by banks, brokers, and other nominees.
The actual number of stockholders of our Class A common stock is greater than the number of record holders and includes stockholders who are beneficial owners but whose shares of Class A common stock are held in street name by banks, brokers, and other nominees.
Stock Performance Graphs and Cumulative Total Return The following graph shows the cumulative total stockholder return of an investment of $100 in cash from December 31, 2019 through December 31, 2024, for (i) our Class A common stock, (ii) the Nasdaq Composite Index, and (iii) the Peer Group of companies described below.
Stock Performance Graphs and Cumulative Total Return The following graph shows the cumulative total stockholder return of an investment of $100 in cash from December 31, 2020 through December 31, 2025, for (i) our Class A common stock, (ii) the Nasdaq Composite Index, and (iii) the Peer Group of companies described below.
Because no published index of comparable companies is currently available, we have used the Peer Group of companies for the purposes of this graph in accordance with the requirements of the SEC.
Because no published index of comparable companies is currently available, we have used the Peer Group of companies for the purposes of this graph in accordance with the requirements of the SEC. Our Peer Group consists of Alphabet, Inc., Fox Corp, fuboTV, Inc., Interpublic Group of Companies, Inc.
Our Peer Group consists of Alphabet, Inc., Fox Corp, fuboTV, Inc., Interpublic Group of Companies, Inc., LiveRamp Holdings, Inc., Magnite, Inc., Meta Platforms, Inc., Netflix, Inc., Paramount Global, Pinterest, Inc., Pubmatic, Inc., Snap, Inc., Tradedesk Financial Corp, Vizio Holding Corp, Walt Disney Co., and Warner Bros. Discovery, Inc.
(“IPG”), LiveRamp Holdings, Inc., Magnite, Inc., Meta Platforms, Inc., Netflix, Inc., Paramount Global, Pinterest, Inc., Pubmatic, Inc., Snap, Inc., Tradedesk Financial Corp, Vizio Holding Corp, Walt Disney Co., and Warner Bros. Discovery, Inc.
Holders of Record As of December 31, 2024, there were approximately 64 stockholders of record of our Class A common stock and 13 stockholders of record of our Class B common stock.
Holders of Record As of December 31, 2025, there were approximatel y 52 sto ckholders of record of our Class A common stock and 14 stockholders of record of our Class B common stock.
Vizio Holding Corp was acquired in fiscal year 2024 and is included in the graph below through the last trade date. Pursuant to applicable SEC rules, all values assume reinvestment of the full amount of all dividends, however no dividends have been declared on our Class A common stock or Class B common stock to date.
Netflix, Inc. underwent a 10:1 stock split in fiscal year 2025, and the graph below has been prepared using post-split data. 41 Table of Contents Pursuant to applicable SEC rules, all values assume reinvestment of the full amount of all dividends, however no dividends have been declared on our Class A common stock or Class B common stock to date.
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Used with permission. All rights reserved. Copyright 1980-2025. Index Data: Copyright NASDAQ OMX, Inc. Used with permission. All rights reserved.
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Share Repurchases The following table summarizes the share repurchase activity for the three months ended December 31, 2025 and the approximate dollar value of shares that may yet be purchased pursuant to our stock repurchase program (in thousands, except share and per share data): Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in thousands) October 1, 2025 to October 31, 2025 101,029 $ 98.98 101,029 $ 340,000 November 1, 2025 to November 30, 2025 311,521 $ 98.22 311,521 309,402 December 1, 2025 to December 31, 2025 562,744 $ 105.53 562,744 250,018 975,294 975,294 Our Board has approved a stock repurchase program with authorization to repurchase up to $400 million of our Class A common stock through December 31, 2026.
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As of December 31, 2025, $250.0 million remained available for repurchases pursuant to our stock repurchase program.
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Repurchases under the stock repurchase program may be made at our discretion from time to time in open market transactions at prevailing market prices, including through trading plans that may be adopted in accordance with Rule 10b5-1 of the Exchange Act or through other means.
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The amount and timing of repurchases will depend on a variety of factors, including general market conditions, the trading price of our Class A common stock, corporate and regulatory requirements, the availability of funds, other investment opportunities, and other considerations we deem relevant. The stock repurchase program may be modified, suspended, or terminated at any time.
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Vizio Holding Corp was acquired in fiscal year 2024 and IPG was acquired in fiscal year 2025, and the data for these companies has been included in the graph below through the last trade date.
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Company / Index Dec-20 Dec-21 Dec-22 Dec-23 Dec-24 Dec-25 Roku, Inc. $100 $69 $12 $28 $22 $33 Nasdaq Composite Index $100 $122 $82 $119 $154 $187 Peer Group $100 $133 $70 $122 $178 $247 Source: Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980-2025. Index Data: Copyright NASDAQ OMX, Inc. Used with permission.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeCash Flows The following table summarizes our cash flows for the periods presented (in thousands): Years Ended December 31, 2024 2023 Consolidated Statements of Cash Flows Data: Cash flows provided by operating activities $ 218,045 $ 255,856 Cash flows used in investing activities $ (25,061) $ (92,619) Cash flows used in financing activities $ (89,203) $ (61,243) Cash Flows from Operating Activities Our operating activities provided cash of $218.0 million for the year ended December 31, 2024.
Biggest changeCash Flows The following table summarizes our cash flows for the periods presented (in thousands): Years Ended December 31, 2025 2024 Consolidated Statements of Cash Flows Data: Cash flows provided by operating activities $ 483,718 $ 218,045 Cash flows used in investing activities $ (782,370) $ (25,061) Cash flows used in financing activities $ (280,098) $ (89,203) Cash Flows from Operating Activities Cash provided by operating activities increased in 2025 compared to 2024 primarily due to net income of $88.4 million in the current year, compared to a net loss of $129.4 million in the prior year, partially offset by lower non-cash adjustments to cash flows due mainly to lower impairment and stock-based compensation in the current year as compared to prior year. 49 Table of Contents Cash Flows from Investing Activities Net cash used in investing activities increased during 2025 compared to 2024 due primarily to purchases of short-term investments of $725.0 million and our acquisition of Frndly TV for $95.1 million, partially offset by repayments of $50.0 million received from our strategic investment in convertible promissory notes, which were fully repaid in 2025.
Though we do not expect to incur expenses for facilities and building related costs at the same level as the last few fiscal years, we will continue to incur expenses on the maintenance of our facilities and purchases of computer systems, and other property and equipment, in order to support future growth in our business.
Though we do not expect to incur expenses for facilities and building related costs at the same level as we have in the last few fiscal years, we will continue to incur expenses on the maintenance of our facilities and purchases of computer systems, and other property and equipment, in order to support future growth in our business.
These activities may materially impact our liquidity and capital resources. 49 Table of Contents We believe our existing cash and cash equivalents balance, and our undrawn available balance under our Credit Agreement (as discussed below), will be sufficient to meet our working capital, capital expenditures, and material cash requirements from known contractual obligations for the next twelve months and beyond.
These activities may materially impact our liquidity and capital resources. 48 Table of Contents We believe our existing cash and cash equivalents balance, and our undrawn available balance under our Credit Agreement (as discussed below), will be sufficient to meet our working capital, capital expenditures, and material cash requirements from known contractual obligations for the next twelve months and beyond.
Devices revenue is generated from the sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories. We expect to continue to manage the average selling prices of Roku streaming devices in an effort to sell more devices, which we believe will increase our Streaming Households.
Devices revenue is generated from the sale of streaming players, Roku-made TVs, smart home products and services, audio products, and related accessories. We expect to continue to manage the average selling prices of Roku streaming devices in an effort to sell more devices, which we believe will increase our Streaming Households.
Allowances for Sales Returns and Sales Incentives Our accounts receivable is stated at invoice value less estimated allowances that include allowance for sales returns and sales incentives. We perform an ongoing analysis of various factors including our historical experience, promotional programs, claims to date, and other business factors to determine the allowances for sales returns and sales incentives.
Allowances for Sales Returns and Sales Incentives Our accounts receivable are stated at invoice value less estimated allowances that include allowance for sales returns and sales incentives. We perform an ongoing analysis of various factors including our historical experience, promotional programs, claims to date, and other business factors to determine the allowances for sales returns and sales incentives.
Cost of Revenue, Devices Cost of revenue, devices is comprised mostly of manufacturing costs payable to third-party manufacturers for devices we sell which include streaming players, Roku-branded TVs, audio products and smart home products.
Cost of Revenue, Devices Cost of revenue, devices is comprised mostly of manufacturing costs payable to third-party manufacturers for devices we sell which include streaming players, Roku-made TVs, audio products and smart home products.
If such facts and circumstances indicate an asset or asset group’s carrying amount may not be recoverable, we assess its recoverability by comparing the projected undiscounted net cash flows directly associated with the use and eventual disposition of the asset or asset group against their respective carrying amounts.
If such facts and circumstances indicate an asset or asset group’s carrying amount may not be recoverable, we assess its recoverability by comparing the projected undiscounted net cash flows 50 Table of Contents directly associated with the use and eventual disposition of the asset or asset group against their respective carrying amounts.
For example, if a Roku player is connected to a TV, and the viewer turns off the TV, steps away, or falls asleep and does not stop or pause the player, then the particular streaming app may continue to play content for 44 Table of Contents a period of time determined by the streaming app.
For example, if a Roku player is connected to a TV, and the viewer turns off the TV, steps away, or falls asleep and does not stop or pause the player, then the particular streaming app may continue to play content for a period of time determined by the streaming app.
Discussions of fiscal year 2022 and year-to-year comparisons between fiscal years 2023 and 2022 that are not included in this Annual Report can be found in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of our Annual Report for the fiscal year ended December 31, 2023 filed with the SEC on February 16, 2024.
Discussions of fiscal year 2023 and year-to-year comparisons between fiscal years 2024 and 2023 that are not included in this Annual Report can be found in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of our Annual Report for the fiscal year ended December 31, 2024 filed with the SEC on February 14, 2025.
Recent Accounting Pronouncements The recent accounting pronouncements are discussed and included in Note 2 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report. They are incorporated herein by reference.
Recent Accounting Pronouncements The recent accounting pronouncements are discussed and included in Note 2 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report. They are incorporated herein by reference. 51 Table of Contents
This section of this Annual Report generally discusses fiscal years 2024 and 2023 and year-to-year comparisons between those years.
This section of this Annual Report generally discusses fiscal years 2025 and 2024 and year-to-year comparisons between those years.
Our Free Cash Flow was $203.2 million and $175.9 million for the TTM periods ended December 31, 2024 and 2023, respectively. Free Cash Flow is a non-GAAP financial measure. The Free Cash Flow reconciliation excludes purchases of property and equipment and effects of exchange rates on cash from the cash flows from operating activities, in each case where applicable.
Our Free Cash Flow was $483.6 million and $203.2 million for the TTM periods ended December 31, 2025 and 2024, respectively. Free Cash Flow is a non-GAAP financial measure. The Free Cash Flow reconciliation excludes purchases of property and equipment and effects of exchange rates on cash from the cash flows from operating activities, in each case where applicable.
The increase in average selling price is due to increased sales of Roku-branded TVs, which generally sell at higher prices compared to streaming players. The increase in the volume of devices shipped was mainly due to higher sales of Roku-branded TVs.
The increase in average selling price is due to increased sales of Roku-made TVs, which generally sell at higher prices compared to streaming players. The decrease in the volume of devices shipped was mainly due to lower sales of streaming players.
The following table presents a reconciliation of Free Cash Flow to the most directly comparable GAAP financial measure for each of the periods indicated (in thousands): Trailing Twelve Months Ended December 31, 2024 December 31, 2023 Net cash provided by operating activities $ 218,045 $ 255,856 Less: Purchases of property and equipment (5,061) (82,619) Add/(Less): Effect of exchange rate changes on cash, cash equivalents and restricted cash (9,746) 2,654 Free cash flow (TTM) $ 203,238 $ 175,891 Components of Results of Operations Revenue Platform Revenue We generate platform revenue from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services), as well as streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls).
The following table presents a reconciliation of Free Cash Flow to the most directly comparable GAAP financial measure for each of the periods indicated (in thousands): Trailing Twelve Months Ended December 31, 2025 December 31, 2024 Net cash provided by operating activities $ 483,718 $ 218,045 Less: Purchases of property and equipment (5,280) (5,061) Add/(Less): Effect of exchange rate changes on cash, cash equivalents and restricted cash 5,179 (9,746) Free cash flow (TTM) $ 483,617 $ 203,238 44 Table of Contents Components of Results of Operations Revenue Platform Revenue We generate Platform revenue from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services), as well as streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, the sale of owned and operated subscription services, and the sale of branded app buttons on remote controls).
Other Income, Net Other income, net primarily consists of interest income on cash and cash equivalents, foreign currency re-measurement, transaction gains and losses, and net change in the fair value of our strategic investments.
Other Income, Net Other income, net primarily consists of interest income on cash and cash equivalents and short-term investments, foreign currency remeasurement, transaction gains and losses, and net change in the fair value of our strategic investments.
Income Tax Expense Our income tax expense consists primarily of income taxes in certain foreign jurisdictions where we conduct business and income taxes in the United States. We have a full valuation allowance against net deferred tax assets in the United States.
Income Tax Expense Our income tax expense consists primarily of income tax expense in certain foreign jurisdictions where we conduct business and income tax expense (benefit) in the United States. We have a full valuation allowance against net deferred tax assets in the United States as of December 31, 2025.
Material Cash Requirements from Known Contractual Obligations For a description of our purchase obligations and operating lease obligations, refer to Note 12 and Note 9 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report, respectively. In addition, we have $4.8 million of uncertain tax positions as of December 31, 2024.
Material Cash Requirements from Known Contractual Obligations For a description of our purchase obligations and operating lease obligations, refer to Note 13 and Note 10 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report, respectively. In addition, we have $5.2 million of uncertain tax positions as of December 31, 2025.
We had outstanding letters of credit secured by the Credit Agreement of $36.4 million as of December 31, 2024. As of December 31, 2024, we had not borrowed against the Credit Agreement, and we were in compliance with all of the covenants of the Credit Agreement.
We had outstanding letters of credit secured by the Credit Agreement of $39.5 million as of December 31, 2025. As of December 31, 2025, we had not borrowed against the Credit Agreement, and we were in compliance with all of the covenants of the Credit Agreement.
Platform revenue is generated from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our UI, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls).
Platform revenue is generated from the sale of digital advertising (including direct and programmatic video advertising, ads integrated into our user 42 Table of Contents interface (“UI”), and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, the sale of owned and operated subscription services, and the sale of branded app buttons on remote controls).
See Note 10 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report for additional details.
See Note 18 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report.
The primary uses of cash are costs of revenue including costs to acquire advertising inventory, costs to license and produce content, third-party manufacturing costs for our products, as well as operating expenses such as personnel-related expenses, consulting and professional service expenses, facility expenses, and marketing expenses. Other uses of cash include purchases of property and equipment and mergers and acquisitions.
Our primary sources of cash are receipts from Platform and Devices revenue. The primary uses of cash are costs of revenue including costs to acquire advertising inventory, costs to license and produce content, third-party manufacturing costs for our products, as well as operating expenses such as personnel-related expenses, consulting and professional service expenses, facility expenses, and marketing expenses.
Income Tax Expense Years Ended December 31, 2024 2023 Change $ Change % (in thousands, except percentages) Income tax expense $ 9,428 $ 10,131 $ (703) (7) % Income tax expense Income tax expense decreased by $0.7 million, or 7%, for the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Income Tax Expense Years Ended December 31, 2025 2024 Change $ Change % (in thousands, except percentages) Income tax expense $ 5,537 $ 9,428 $ (3,891) (41) % Income tax expense decreased by $3.9 million, or 41%, for the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Devices The cost of revenue, devices increased by $136.0 million, or 25%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023. The increase was primarily driven by higher manufacturing costs of $115.0 million, driven by the higher cost of manufacturing Roku-branded TVs, and higher freight costs of $31.8 million.
Devices Cost of revenue, devices increased by $3.9 million, or 1%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. The increase was primarily driven by higher manufacturing costs of $17.8 million, and higher freight costs of $9.5 million.
We expect to maintain this valuation allowance for the foreseeable future. 46 Table of Contents Results of Operations The following table sets forth selected consolidated statements of operations data as a percentage of total revenue for each of the periods indicated.
Results of Operations The following table sets forth selected consolidated statements of operations data as a percentage of total revenue for each of the periods indicated.
In our international markets, we primarily sell our devices through wholesale distributors which, in turn, sell to retailers. Cost of Revenue Cost of Revenue, Platform Cost of revenue, platform primarily consists of costs associated with acquiring advertising inventory, content amortization costs for both licensed and produced content, costs for licensed premium subscriptions, and revenue share payments on licensed content.
Cost of Revenue Cost of Revenue, Platform Cost of revenue, platform primarily consists of costs associated with acquiring advertising inventory, content amortization costs for both licensed and produced content, costs for licensed premium subscriptions, and revenue share payments on licensed content.
To date, we have generated most of our platform revenue in the United States. Devices Revenue We generate devices revenue from the sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories. We generate most of our devices revenue in the United States.
Devices Revenue We generate Devices revenue from the sale of streaming players, Roku-made TVs, smart home products and services, audio products, and related accessories. We generate most of our Devices revenue in the United States. In our international markets, we primarily sell our devices through wholesale distributors which, in turn, sell to retailers.
Years Ended December 31, 2024 2023 2022 Net revenue: Platform 86 % 86 % 87 % Devices 14 % 14 % 13 % Total net revenue 100 % 100 % 100 % Cost of revenue: Platform 40 % 41 % 38 % Devices 16 % 15 % 16 % Total cost of revenue 56 % 56 % 54 % Gross profit (loss): Platform 46 % 45 % 49 % Devices (2) % (1) % (3) % Total gross profit 44 % 44 % 46 % Operating expenses: Research and development 18 % 25 % 25 % Sales and marketing 23 % 30 % 27 % General and administrative 8 % 12 % 11 % Total operating expenses 49 % 67 % 63 % Loss from operations (5) % (23) % (17) % Other income, net: Interest expense — % — % — % Other income, net 2 % 3 % 1 % Total other income, net 2 % 3 % 1 % Loss before income taxes (3) % (20) % (16) % Income tax expense — % — % — % Net loss (3) % (20) % (16) % Comparison of Years Ended December 31, 2024 and 2023 Net Revenue Years Ended December 31, 2024 2023 Change $ Change % (in thousands, except percentages) Platform $ 3,522,776 $ 2,994,105 $ 528,671 18 % Devices 590,122 490,514 99,608 20 % Total net revenue $ 4,112,898 $ 3,484,619 $ 628,279 18 % Platform Platform revenue increased by $528.7 million, or 18%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023, primarily due to higher revenue from streaming services distribution, such as revenue share on content subscriptions and Premium Subscriptions through The Roku Channel, in addition to higher advertising revenue, despite continued weakness in the media and entertainment vertical. 47 Table of Contents Devices Devices revenue increased by $99.6 million, or 20%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Years Ended December 31, 2025 2024 2023 Net revenue: Platform 87 % 86 % 86 % Devices 13 % 14 % 14 % Total net revenue 100 % 100 % 100 % Cost of revenue: Platform 42 % 40 % 41 % Devices 14 % 16 % 15 % Total cost of revenue 56 % 56 % 56 % Gross profit (loss): Platform 46 % 46 % 45 % Devices (2) % (2) % (1) % Total gross profit 44 % 44 % 44 % Operating expenses: Research and development 15 % 18 % 25 % Sales and marketing 20 % 23 % 30 % General and administrative 9 % 8 % 12 % Total operating expenses 44 % 49 % 67 % Loss from operations — % (5) % (23) % Other income, net: Interest expense — % — % — % Other income, net 2 % 2 % 3 % Total other income, net 2 % 2 % 3 % Income (loss) before income taxes 2 % (3) % (20) % Income tax expense — % — % — % Net income (loss) 2 % (3) % (20) % Comparison of Years Ended December 31, 2025 and 2024 Net Revenue Years Ended December 31, 2025 2024 Change $ Change % (in thousands, except percentages) Platform $ 4,144,886 $ 3,522,776 $ 622,110 18 % Devices 592,365 590,122 2,243 — % Total net revenue $ 4,737,251 $ 4,112,898 $ 624,353 15 % Platform Platform revenue increased by $622.1 million, or 18%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024, primarily due to higher revenue from streaming services distribution, specifically higher Premium Subscription revenue and higher subscription revenue from both third-party and our owned and 46 Table of Contents operated subscription services.
Gross profit for the platform segment increased by $319.4 million, or 20%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023, primarily driven by the overall growth in our platform revenue.
The increase was primarily driven by higher licensing costs for Premium Subscriptions and higher costs of acquiring content. Gross profit for the platform segment increased by $270.5 million, or 14%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024, primarily driven by the overall growth in our Platform revenue.
If our estimates regarding accounts receivable allowances differ from the actual results, the losses or gains could be material. Provision for Income Taxes We are subject to income taxes in the U.S. and foreign jurisdictions. We account for income taxes using the asset and liability method.
The actual results could differ from our estimates. Provision for Income Taxes We are subject to income taxes in the U.S. and foreign jurisdictions. We account for income taxes using the asset and liability method. Under this method, income tax expense is recognized for the amount of taxes payable or refundable for the current year.
We have pursued merger and acquisition activities in the past, and we may pursue additional merger and acquisition activities in the future, including the acquisition of rights to programming and content assets.
Other uses of cash include purchases of property and equipment, mergers and acquisitions, and share repurchases. We have pursued merger and acquisition activities, such as the acquisition of Frndly TV, and we may pursue additional merger and acquisition activities in the future, including the acquisition of rights to programming and content assets.
Other Income, Net Years Ended December 31, 2024 2023 Change $ Change % (in thousands, except percentages) Interest expense $ (411) $ (730) $ 319 (44) % Other income, net 98,620 93,677 4,943 5 % Total other income, net $ 98,209 $ 92,947 $ 5,262 6 % Other income, net Total other income, net, increased by $5.3 million, or 6%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Other Income, Net Years Ended December 31, 2025 2024 Change $ Change % (in thousands, except percentages) Interest expense $ (1,906) $ (411) $ (1,495) 364 % Other income, net 101,428 98,620 2,808 3 % Total other income, net $ 99,522 $ 98,209 $ 1,313 1 % Total other income, net, increased by $1.3 million, or 1%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024.
If the asset or asset group is not recoverable, an impairment loss is recognized based on the excess of the carrying amount over the fair value of the asset or asset group.
If the asset or asset group is not recoverable, an impairment loss is recognized based on the excess of the carrying amount over the fair value of the asset or asset group. During the year ended December 31, 2025, we recognized an impairment charge of $2.9 million for operating lease right-of-use assets.
Our ad inventory includes video ad inventory from AVOD content in The Roku Channel, native display ads throughout the Roku Experience, as well as ad inventory we obtain through our streaming services distribution 45 Table of Contents agreements with our content partners. To supplement supply, we purchase advertising inventory from our content partners, on an as needed basis.
Our ad inventory primarily includes video ad inventory from AVOD content in The Roku Channel, native ads throughout the Roku Experience, as well as ad inventory we obtain as consideration from our streaming services distribution agreements with our content partners. To date, we have generated most of our Platform revenue in the United States.
Cash Flows from Financing Activities Net cash used in financing activities of $89.2 million for the year ended December 31, 2024 was primarily due to tax payments of $96.4 million to net settle equity awards vested during the period and the payment of $2.2 million in issuance costs related to our Credit Agreement, offset by $9.4 million received from proceeds from the exercise of employee stock options.
Cash Flows from Financing Activities Net cash used in financing activities increased during 2025 compared to 2024 primarily due to tax payments of $164.9 million to net settle equity awards vested during the period and $150.0 million in repurchases of our common stock, partially offset by proceeds from the exercise of employee stock options of $34.7 million.
General and administrative General and administrative expenses decreased by $32.2 million, or 8%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023. The decrease was primarily driven by lower restructuring charges of $56.5 million, partially offset by higher legal, consulting, and professional services of $17.6 million and higher personnel-related expenses of $5.6 million.
These increases were partially offset by lower personnel-related expenses of $23.3 million. General and administrative General and administrative expenses increased by $15.3 million, or 4%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. The increase was primarily driven by higher legal and consulting expenses of $26.7 million.
The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance when it is more likely than not they will not be realized. In determining the need for a valuation allowance, we assess all available positive and negative evidence, including cumulative historic losses and forecasted earnings.
In determining the need for a valuation allowance, we assess all available positive and negative evidence, including cumulative historic losses and forecasted earnings.
We manage the average selling prices of our products to grow our Streaming Households.
We manage the average selling prices of our products to grow our Streaming Households, which we expect to result in increased Platform revenue and Platform gross profit over time.
During the year ended December 31, 2024, the average selling price of all devices shipped increased by 18% and the volume of all devices shipped increased by 5% as compared to the year ended December 31, 2023.
The increase in revenue is due to higher sales of Roku-made TVs, partially offset by lower sales of streaming players. During the year ended December 31, 2025, the average selling price of all devices shipped increased by 6% and the volume of all devices shipped decreased by 3% as compared to the year ended December 31, 2024.
Operating Expenses Years Ended December 31, 2024 2023 Change $ Change % (in thousands, except percentages) Research and development $ 720,145 $ 878,474 $ (158,329) (18) % Sales and marketing 932,712 1,033,359 (100,647) (10) % General and administrative 370,955 403,159 (32,204) (8) % Total operating expenses $ 2,023,812 $ 2,314,992 $ (291,180) (13) % Research and development Research and development expenses decreased by $158.3 million, or 18%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Operating Expenses Years Ended December 31, 2025 2024 Change $ Change % (in thousands, except percentages) Research and development $ 729,477 $ 720,145 $ 9,332 1 % Sales and marketing 964,355 932,712 31,643 3 % General and administrative 386,216 370,955 15,261 4 % Total operating expenses $ 2,080,048 $ 2,023,812 $ 56,236 3 % 47 Table of Contents Research and development Research and development expenses increased by $9.3 million, or 1%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Sales and marketing Sales and marketing expenses decreased by $100.6 million, or 10%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Sales and marketing Sales and marketing expenses increased by $31.6 million, or 3%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. The increase was primarily driven by higher advertising expenses of $37.3 million, higher amortization expense of $11.6 million, and higher consulting expenses of $3.4 million.
Cost of Revenue and Gross Profit Years Ended December 31, 2024 2023 Change $ Change % (in thousands, except percentages) Cost of Revenue: Platform $ 1,636,816 $ 1,427,546 $ 209,270 15 % Devices 670,437 534,458 135,979 25 % Total cost of revenue $ 2,307,253 $ 1,962,004 $ 345,249 18 % Gross Profit (Loss): Platform $ 1,885,960 $ 1,566,559 $ 319,401 20 % Devices (80,315) (43,944) (36,371) 83 % Total gross profit $ 1,805,645 $ 1,522,615 $ 283,030 19 % Platform The cost of revenue, platform increased by $209.3 million, or 15%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Cost of Revenue and Gross Profit (Loss) Years Ended December 31, 2025 2024 Change $ Change % (in thousands, except percentages) Cost of Revenue: Platform $ 1,988,442 $ 1,636,816 $ 351,626 21 % Devices 674,385 670,437 3,948 1 % Total cost of revenue $ 2,662,827 $ 2,307,253 $ 355,574 15 % Gross Profit (Loss): Platform $ 2,156,444 $ 1,885,960 $ 270,484 14 % Devices (82,020) (80,315) (1,705) 2 % Total gross profit $ 2,074,424 $ 1,805,645 $ 268,779 15 % Platform Cost of revenue, platform increased by $351.6 million, or 21%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Gross loss for the devices segment increased by $36.4 million, or 83%, during the year ended December 31, 2024 as compared to the year ended December 31, 2023. The gross loss was driven by a higher cost of manufacturing of products in the devices segment as compared to the revenue generated from them.
These increases were partially offset by lower inventory reserves of $15.4 million and lower royalty costs of $3.8 million. Gross loss for the Devices segment increased by $1.7 million, or 2%, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. The increase in gross loss was driven by higher manufacturing and freight costs.
The decrease was primarily driven by lower restructuring charges of $87.7 million, lower office facilities and IT infrastructure expenses of $13.8 million, and lower personnel-related expenses of $12.1 million, partially offset by higher consulting expenses of $6.1 million and higher marketing, retail, and merchandising expenses of $5.9 million.
The increase was primarily driven by higher cloud hosting and consulting expenses of $22.6 million offset by lower personnel-related expenses of $12.4 million and lower facilities and IT expenses of $3.3 million.
Approximately 5% of our cash was held outside the United States in accounts held by our foreign subsidiaries, which are used to fund foreign operations. Our primary sources of cash are receipts from platform and devices revenue.
Liquidity and Capital Resources As of December 31, 2025, we had cash and cash equivalents of $1,587.1 million and short-term investments of $730.2 million. Approximately 9% of our cash was held outside the United States in accounts held by our foreign subsidiaries, which are used to fund foreign operations, and all short-term investments were held in the United States.
Key Performance Metrics and Non-GAAP Measure The key performance metrics we use to evaluate our business, measure our performance, develop financial forecasts and make strategic decisions are Streaming Households, Streaming Hours, ARPU, and Free Cash Flow. Beginning with our results for the first quarter of 2025, we will no longer report quarterly updates on Streaming Households, and by extension, ARPU.
The key performance metrics we use to evaluate our business, measure our performance, develop financial forecasts and make strategic decisions are Streaming Hours, Platform revenue, Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), and Free Cash Flow.
Under this method, income tax expense is recognized for the amount of taxes payable or refundable for the current year. In addition, deferred tax assets and liabilities are determined based on the differences between financial reporting and tax bases of assets and liabilities using the enacted tax rates.
In addition, deferred tax assets and liabilities are determined based on the differences between financial reporting and tax bases of assets and liabilities using the enacted tax rates. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance when it is more likely than not they will not be realized.
The decrease was primarily driven by lower restructuring 48 Table of Contents charges of $110.6 million, lower personnel-related expenses of $25.2 million, lower office facilities and IT infrastructure expenses of $17.5 million, and lower consulting expenses of $3.3 million.
The increase was partially offset by lower facilities expense of $5.3 million, lower restructuring charges of $4.5 million, and lower personnel-related expenses of $1.0 million.
The decrease was primarily due to a tax benefit from the release of a valuation allowance on certain foreign deferred tax assets, partially offset by increases in U.S. and foreign current taxes due to the increase of taxable earnings. Liquidity and Capital Resources As of December 31, 2024, we had cash and cash equivalents of $2,160.2 million.
The decrease is due to a reduction in U.S. federal and certain state taxes due to the 2025 enactment of the One Big Beautiful Bill Act and a tax benefit related to our acquisition of Frndly TV, partially offset by a one-time release of valuation allowance on certain foreign deferred tax assets in 2024.
Since we first reported our key performance metrics in connection with our initial public offering in 2017, our business and the streaming industry have evolved significantly. Now, we are primarily focused on the growth of revenue of our platform segment and Adjusted earnings before interest, tax, depreciation and amortization (Adjusted EBITDA).
Key Performance Metrics and Non-GAAP Measures Since our IPO in 2017, the streaming TV industry has evolved meaningfully, with Americans now spending significantly more TV time streaming than watching traditional TV. Our business has also grown and evolved, and we are now primarily focused on growing Platform revenue and profitability.
The increase was primarily driven by an increase in interest income of $11.9 million from higher cash balances, partially offset by higher foreign exchange losses of $5.0 million due to exchange rate fluctuations and a decrease in other income of $1.9 million mainly from lower unrealized gains related to the change in the fair value of strategic investments .
The increase was primarily driven by lower foreign currency remeasurement losses of $5.3 million and higher fair value remeasurement gains on our strategic investment in convertible promissory notes of $1.5 million.
We streamed 127.1 billion and 106.0 billion h ours during the years ended December 31, 2024 and 2023, respectively, reflecting an increase of 20%. Average Revenue per User We measure our platform monetization progress with ARPU.
We streamed 145.6 billion and 127.1 billion hours during the years ended December 31, 2025 and 2024, respectively, reflecting an increase of 15%. Platform Revenue We use Platform revenue as a primary metric to measure the performance of our business because it represents our ability to successfully monetize our platform. Platform revenue growth is one of our strategic priorities.
There were no impairments of property and equipment or operating lease right-of-use assets during the year ended December 31, 2022. See Note 17 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report.
See Note 11 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report for additional details. Share Repurchases During the year ended December 31, 2025, we repurchased 1.5 million shares of our Class A common stock through our stock repurchase program. All share repurchases were made using cash resources.
Removed
As a result, effective as of the first quarter of 2025, our key performance metrics will be Streaming Hours, Platform Revenue, Adjusted EBITDA, and Free Cash Flow. Streaming Households We believe that the number of Streaming Households is a relevant measure to gauge the size of our user base.
Added
Business Conditions and Macroeconomic Factors Our business is subject to risks related to the evolving macroeconomic environment, including the effects of increased volatility in financial markets, higher inflation and interest rates, potential economic slowdown or recession, geopolitical developments, changes in economic or government policies, including the unknown impact of tariffs, changing global regulations, and the overall uncertainty surrounding international trade relations.
Removed
We define Streaming Households as the number of distinct user accounts that have streamed content on our platform within the last 30 days of the period. We refer to such accounts as “Streaming Households” because a given user account does not necessarily represent a single viewer or a single Roku streaming device.
Added
While we intend to remain vigilant in monitoring the impacts of these circumstances on our business and adapt accordingly, the effects of these macroeconomic factors on our business, results of operations, and financial condition remain largely uncertain. See Item 1A, Risk Factors, and the Note Regarding Forward Looking Statements elsewhere in this Annual Report for additional details.
Removed
Rather, a single account may be used by multiple viewers and linked to multiple devices. As a result, we may identify more than one Streaming Household within a single dwelling, and more than one dwelling may constitute a Streaming Household. Users who streamed content from The Roku Channel only on non-Roku platforms are not included in this metric.
Added
As a result, and as previously disclosed, starting in the first quarter of 2025, we have updated our Key Performance Metrics (“KPMs”) to better align with these priorities.
Removed
Additionally, users who only register an account for use of one of our smart home products are not included in our reported number of Streaming Households. We had 89.8 million and 80.0 million Streaming Households as of December 31, 2024 and 2023 , respectively, reflecting an increase of 12%.
Added
Platform revenue was $4.1 billion and $3.5 billion for years ended December 31, 2025 and 2024, respectively. 43 Table of Contents Adjusted EBITDA (Non-GAAP Measure) We use Adjusted EBITDA as a primary metric to measure the performance of our business because it represents our ability to successfully manage profitability.
Removed
We define ARPU as our platform revenue for the trailing four quarters divided by the average of the number of Streaming Households at the end of the current period and the end of the corresponding period in the prior year. ARPU measures the rate at which we are monetizing our Streaming Households base and the progress of our platform business.
Added
Our goal is to grow Adjusted EBITDA over time, driving continued growth in stockholder value. Adjusted EBITDA is a non-GAAP financial measure. The Adjusted EBITDA reconciliation excludes total other income, net, stock-based compensation expense, depreciation and amortization, restructuring charges, and income tax expense (benefit) from the net income (loss) of the period.
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ARPU was $41.49 as of December 31, 2024 as compared to $39.92 as of December 31, 2023, reflecting an increase of 4% .
Added
We believe Adjusted EBITDA is useful as a supplement in evaluating our ongoing operational performance and enhancing an overall understanding of our past financial performance. However, this non-GAAP financial measure has limitations, and should not be considered in isolation or as a substitute for our GAAP financial information, such as GAAP net income (loss).
Removed
The increase in ARPU was driven by platform revenue growth in the United States, partially offset by an increasing share of Streaming Households in international markets where we are currently focused more on scale and engagement than monetization.
Added
In addition, Adjusted EBITDA may not be comparable to similarly titled metrics of other companies due to differences in methods of calculation.
Removed
The increase was primarily due to higher revenue from Roku-branded TVs. This was partially offset by lower revenue from streaming players, audio and smart home products.
Added
The following table presents a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure for each of the periods indicated (in thousands): Years Ended December 31, 2025 2024 2023 Net income (loss) $ 88,361 $ (129,386) $ (709,561) Total other income, net (99,522) (98,209) (92,947) Stock-based compensation 354,169 384,662 370,130 Depreciation and amortization 68,904 62,714 70,447 Restructuring charges (1) 3,064 30,999 356,094 Income tax expense 5,537 9,428 10,131 Adjusted EBITDA $ 420,513 $ 260,208 $ 4,294 (1) Restructuring charges for the year ended December 31, 2025 primarily include asset impairment charges of $2.9 million.
Removed
The increase was primarily driven by higher costs of acquiring content and higher credit card processing fees. During the year ended December 31, 2023, cost of revenue, platform also included restructuring charges of $67.0 million of which $65.5 million consisted of impairment charges related to removing selected content assets from The Roku Channel.
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Restructuring charges for the year ended December 31, 2024 primarily include asset impairment charges of $29.1 million.
Removed
Our net loss of $129.4 million for the year ended December 31, 2024 was adjusted by non-cash charges of $756.2 million comprised mainly of stock-based compensation, amortization and write-off of content assets, depreciation and amortization of property and equipment and intangible assets, amortization of operating right-of-use assets, impairment of assets as part of restructuring charges, foreign currency remeasurement losses, and fair value changes of strategic investments.
Added
Restructuring charges for the year ended December 31, 2023 include operating lease right-of-use assets impairment charges of $131.6 million, property and equipment impairment charges of $72.3 million, content asset impairment charges of $65.5 million, employee severance and related charges of $83.2 million, and facilities exit costs of $3.5 million.
Removed
The negative impact from changes in operating assets and liabilities of $408.8 million was primarily due to payments made to acquire content, a decrease in accounts payable, payments made for operating leases liabilities, an increase in inventory, an increase in other long-term assets, and an increase in prepaid expenses and other current assets, partially offset by an increase in accrued liabilities due to timing of payments and an increase in deferred revenue. 50 Table of Contents Cash Flows from Investing Activities Net cash used in investing activities of $25.1 million for the year ended December 31, 2024 included purchases of property and equipment and expenditures related to the expansion of our office facilities of $5.1 million and an additional strategic investment of $20.0 million.
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Given our current and anticipated future earnings, we believe 45 Table of Contents that there is a reasonable possibility that the valuation allowance against these net deferred tax assets may be reversed within the next twelve to eighteen months.
Removed
Amortization of Content Assets The amortization expense for content assets (licensed and produced) is based on projected usage of such content which results in accelerated or straight-lined patterns depending on the nature of the content. Judgment is required to determine the amortization patterns of our content assets which are monetized as a group.
Added
In addition, advertising revenue increased due to improved monetization from video ads, including Roku Ads Manager, our self-service ad platform, offset by weakness in the media and entertainment vertical. Devices Devices revenue remained relatively flat during the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Removed
Critical judgments include: (i) 51 Table of Contents the predominant monetization strategy of content, (ii) the grouping of content with similar characteristics, and (iii) the application of historical viewership model and projected decay. These judgments and underlying analysis are reviewed regularly and adjusted as needed on a prospective basis.
Added
The increase was partially offset by lower interest income on our cash, cash equivalents, and short- term investments of $3.5 million and higher interest expense related to our credit agreement of $1.5 million.
Added
As of December 31, 2025, $250.0 million remained of our $400 million stock repurchase program. See Note 12 to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report for additional details.
Added
Business Combinations We recognize, separately from goodwill, identifiable assets and liabilities acquired in a business combination at fair value on the date of acquisition. We use our best estimates and assumptions to determine the fair value of contingent consideration, and tangible and identifiable intangible assets acquired and liabilities assumed at the acquisition date.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Fluctuation Risk Our exposure to interest rate risk relates to the interest income generated by cash and cash equivalents. The primary objective of our investment policy is to preserve principal while maximizing income without significantly 52 Table of Contents increasing risk.
Biggest changeItem 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rate Fluctuation Risk Our exposure to interest rate risk relates to the interest income generated by cash, cash equivalents and short-term investments. The primary objective of our investment policy is to preserve principal while maximizing income without significantly increasing risk.
We have experienced and will continue to experience fluctuations in our net income as a result of transaction gains or losses related to revaluing monetary asset and liability balances that are denominated in currencies other than the functional currency of the entities in which they are recorded.
We have experienced and will continue to experience fluctuations in our net income (loss) as a result of transaction gains or losses related to revaluing monetary asset and liability balances that are denominated in currencies other than the functional currency of the entities in which they are recorded.
We have not entered into any derivatives or other financial instruments in an attempt to hedge our foreign currency exchange risk, but we may do so in the future. 53 Table of Contents
We have not entered into any derivatives or other financial instruments in an attempt to hedge our foreign currency exchange risk, but we may do so in the future. 52 Table of Contents
We believe that an increase or decrease in interest rates of 100 basis points on our cash and cash equivalents balance would increase or decrease our interest income by approximately $21.6 million. Foreign Currency Exchange Rate Risk Most of our revenue is generated within the United States and as such we have minimal foreign currency risk related to our revenue.
We believe that an increase or decrease in interest rates of 100 basis points on our cash and cash equivalents balance would increase or decrease our interest income by approximately $15.8 million. Foreign Currency Exchange Rate Risk Most of our revenue is generated within the United States and as such we have minimal foreign currency risk related to our revenue.

Other ROKU 10-K year-over-year comparisons