ROKU INC

3. REVENUE

The Company’s disaggregated revenue is represented by thetwo reportable segments discussed in Note 15.

The contract balances include the following (in thousands):

Accounts receivable are recorded at the amount invoiced, net of an allowance for sales returns, sales incentives, and doubtful accounts. Payment terms can vary by customer and contract.

The timing of revenue recognition may differ from the timing of invoicing to customers. Contract assets are created when invoicing occurs subsequent to revenue recognition. Contract assets are transferred to accounts receivable when the right to invoice becomes unconditional. The Company’s contract assets are current in nature and are included in Prepaid expenses and other current assets. Contract assets decreased by $0.3 million during the three months ended March 31, 2025 due to the timing of billing to customers.

Deferred revenue reflects consideration invoiced prior to the completion of performance obligations and revenue recognition. Deferred revenue increased by $10.2 million during the three months ended March 31, 2025 primarily due to the timing of fulfillment of performance obligations related to advertising arrangements as well as growth in Premium Subscriptions.

Revenue recognized during the three months ended March 31, 2025, from amounts included in the total deferred revenue as of December 31, 2024, was $45.0 million. Revenue recognized during the three months ended March 31, 2024, from amounts included in the total deferred revenue as of December 31, 2023, was $67.3 million.

Revenue allocated to remaining performance obligations represents estimated contracted revenue that has not yet been recognized which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Remaining performance obligations exclude contracts with original expected terms of one year or less. Estimated contracted revenue for these remaining performance obligations was $811.1 million as of March 31, 2025, of which the Company expects to recognize approximately 76% over the next 12 months and the remainder thereafter.

Revenue recognized from performance obligations that were satisfied in previous periods due to changes in the estimated transaction price of the Company’s revenue contracts was not significant during the three months ended March 31, 2025 and 2024.

Customer J accounted for 11% of the Company’s total net revenue during the three months ended March 31, 2025. The Company did not have any customer that individually accounted for 10% or more of its total net revenue during the three months ended March 31, 2024.