ROKU, INC
For the period ended Sep 30, 2026. Filed Nov 2, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 2, 2026
ROKU$160.52+0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0001628280-26-054335
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-02.
0001628280-26-068887
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 119 previous paragraphs and 118 current paragraphs.
83 unchanged; 31 reworded; 4 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 9 previous and 9 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (4)
Current report
(1)Restructuring charges for the three and nine months ended September 30, 2026 include a credit of $22.3 million for terminating a portion of a corporate lease that was previously impaired in prior year restructuring efforts. See Note 10 for further details.
Current report
Cost of revenue, devices increased by $73.4 million, or 43%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 due to higher manufacturing costs.
Current report
Income tax expense decreased by $9.2 million, or 70%, for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The decrease was primarily attributable to a cumulative estimated annual effective rate adjustment recorded in the third quarter of 2025 following the enactment of the One Big Beautiful Bill Act.
Current report
Income tax expense increased by $17.8 million, or 313%, for the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, primarily due to higher pre-tax book income.
Removed paragraphs (5)
Previous report
Cost of revenue, devices decreased by $51.1 million, or 17%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The decrease was driven by lower freight costs of $39.1 million, primarily due to an IEEPA refund for tariff payments made in previous quarters, and lower manufacturing costs of $27.0 million, partially offset by an $18.4 million increase in inventory reserves.
Previous report
Income tax expense increased by $11.0 million, or 189%, for the three months ended June 30, 2026, and by $27.0 million, or 143%, for the six months ended June 30, 2026, as compared to the corresponding prior year periods. The increases were primarily attributable to higher pre-tax book income, partially offset by a reduction in U.S. income taxes resulting from the 2025 enactment of the One Big Beautiful Bill Act.
Previous report
Share Repurchases
Previous report
During the second quarter of 2026, we repurchased 0.5 million of our Class A common stock through our stock repurchase program. All share repurchases were made using cash resources.
Previous report
During the second quarter of 2026, we suspended our stock repurchase program in connection with our entry into the Merger Agreement. See Note 12 to our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report for additional details.
Reworded paragraphs (31)
Previous wording
We streamed 37.9 billion and 35.4 billion hours during the three months ended June 30, 2026 and 2025, respectively, reflecting an increase of 7%.
Current wording
We streamed 39.9 billion and 36.5 billion hours during the three months ended September 30, 2026 and 2025, respectively, reflecting an increase of 9%.
Previous wording
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 includes revenue from both our Advertising and Subscriptions segments and its growth is one of our strategic priorities. Platform revenue was $1,221.0 million and $975.5 million for the three months ended June 30, 2026 and 2025, respectively.
Current wording
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 includes revenue from both our Advertising and Subscriptions segments and its growth is one of our strategic priorities. Platform revenue was $1,308.3 million and $1,064.6 million for the three months ended September 30, 2026 and 2025, respectively.
Previous wording
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, merger-related costs, and income tax expense (benefit) from the net income (loss) of the period. 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). In addition, Adjusted EBITDA may not be comparable to similarly titled metrics of other companies due to differences in methods of calculation.
Current wording
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, merger-related costs, and income tax expense (benefit) from the net income of the period. 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. In addition, Adjusted EBITDA may not be comparable to similarly titled metrics of other companies due to differences in methods of calculation.
Previous wording
(1)The merger-related costs for the three and six months ended June 30, 2026 were related to our proposed transaction with Fox. Refer to Note 1 to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
Current wording
(2)The merger-related costs for the three and nine months ended September 30, 2026 were related to our proposed transaction with Fox. Refer to Note 1 to our condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
Previous wording
Our Free Cash Flow was $704.1 million and $392.0 million for the TTM periods ended June 30, 2026 and 2025, respectively.
Current wording
Our Free Cash Flow was $795.7 million and $443.0 million for the TTM periods ended September 30, 2026 and 2025, respectively.
Previous wording
Comparison of the Three and Six Months Ended June 30, 2026 and June 30, 2025
Current wording
Comparison of the Three and Nine Months Ended September 30, 2026 and September 30, 2025
Previous wording
Advertising revenue increased by $133.8 million, or 25%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025, primarily due to an increase in video ad impressions delivered. Video impressions increased by 40%, driven by higher user engagement and growth in streaming hours on our platform. This increase was partially offset by a decrease in the average price per impression of 12%, which was driven by changes in product and country mix.
Current wording
Advertising revenue increased by $136.2 million, or 23%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025, primarily due to an increase in video ad impressions delivered. Video impressions increased by 33%, driven by higher user engagement and growth in streaming hours on our platform. This increase was partially offset by a decrease in the average price per impression of 7%, which was driven by changes in product and country mix.
Previous wording
Advertising revenue increased by $263.6 million, or 26%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to an increase in video ad impressions delivered. Video impressions increased by 48%, driven by higher user engagement and growth in streaming hours on our platform. This increase was partially offset by a decrease in the average price per impression of 13%, which was driven by changes in product and country mix.
Current wording
Advertising revenue increased by $399.8 million, or 25%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025, primarily due to an increase in video ad impressions delivered. Video impressions increased by 42%, driven by higher user engagement and growth in streaming hours on our platform. This increase was partially offset by a decrease in the average price per impression of 11%, which was driven by changes in product and country mix.
Previous wording
Subscriptions revenue increased by $232.3 million, or 28%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to a 11% increase in the number of subscriptions and a 26% increase in the average price per subscription. Additionally the 28% growth was driven in part by the expansion of our owned and operated subscription services, including the acquisition of Frndly TV in May 2025 and the launch of Howdy in August 2025.
Current wording
Subscriptions revenue increased by $107.5 million, or 23%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025, primarily due to a 7% increase in the number of subscriptions and a 27% increase in the average price per subscription. Additionally, the 23% growth was driven in part by the expansion of our owned and operated subscription services, including Howdy, launched in August 2025.
Previous wording
Subscriptions revenue increased by $111.7 million, or 26%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025, primarily due to a 11% increase in the number of subscriptions and a 25% increase in the average price per subscription. Additionally, the 26% growth was driven in part by the expansion of our owned and operated subscription services, including the acquisition of Frndly TV in May 2025 and the launch of Howdy in August 2025.
Current wording
Subscriptions revenue increased by $339.8 million, or 26%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025, primarily due to a 10% increase in the number of subscriptions and a 26% increase in the average price per subscription. Additionally, the 26% overall growth was driven in part by the expansion of our owned and operated subscription services, including Frndly TV, acquired in May 2025, and Howdy, launched in August 2025.
Previous wording
Devices revenue decreased by $1.8 million, or 1%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The volume of all devices shipped decreased by 31% driven by lower sales of streaming players, while the average selling price of all devices shipped increased 35%, due to higher sales of Roku-branded TVs in the comparable periods.
Current wording
Devices revenue increased by $47.7 million, or 33%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The volume of all devices shipped decreased by 21% driven by lower sales of streaming players, while the average selling price of all devices shipped increased 71%, due to higher sales of Roku-made TVs in the comparable periods.
Previous wording
Devices revenue decreased by $24.1 million, or 9%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The volume of all devices shipped decreased by 23% driven by lower sales of streaming players, while the average selling price of all devices shipped increased 14%, due to higher sales of Roku-branded TVs in the comparable periods.
Current wording
Devices revenue increased by $23.7 million, or 6%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The volume of all devices shipped decreased by 22% driven by lower sales of streaming players, while the average selling price of all devices shipped increased 34%, due to higher sales of Roku-made TVs in the comparable periods.
Previous wording
Cost of revenue, advertising increased by $15.4 million, or 6%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The increase was primarily driven by a $22.3 million increase in the costs of acquiring and delivering licensed content for TRC due to an increase in user engagement and video ad impressions delivered, partially offset by a $7.7 million decrease in content amortization.
Current wording
Cost of revenue, advertising increased by $22.3 million, or 9%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The increase was primarily driven by a $17.8 million increase in the costs of acquiring and delivering licensed content for TRC due to an increase in user engagement and video ad impressions delivered, and an $8.8 million increase in content amortization.
Previous wording
Cost of revenue, advertising increased by $44.7 million, or 10%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The increase was primarily driven by a $62.0 million increase in the costs of acquiring and delivering licensed content for TRC due to an increase in user engagement and video ad impressions delivered, partially offset by a $14.5 million decrease in content amortization.
Current wording
Cost of revenue, advertising increased by $67.0 million, or 10%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The increase was primarily driven by a $79.3 million increase in the costs of acquiring and delivering licensed content for TRC due to an increase in user engagement and video ad impressions delivered, partially offset by a $7.0 million decrease in intangible amortization and a $5.3 million decrease in content amortization.
Previous wording
Cost of revenue, subscriptions increased by $182.4 million, or 41%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily driven by higher licensing and content costs. The increase in licensing and content costs include amounts related to Frndly TV, acquired in May 2025, and Howdy, launched in August 2025.
Current wording
Cost of revenue, subscriptions increased by $72.0 million, or 27%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025, primarily driven by higher licensing and content costs. The increase in licensing and content costs includes amounts related to Howdy, launched in August 2025.
Previous wording
Cost of revenue, subscriptions increased by $81.0 million, or 34%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025, primarily driven by higher licensing and content costs. The increase in licensing and content costs include amounts related to Frndly TV, acquired in May 2025, and Howdy, launched in August 2025.
Current wording
Cost of revenue, subscriptions increased by $254.4 million, or 36%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025, primarily driven by higher licensing and content costs. The increase in licensing and content costs includes amounts related to Frndly TV, acquired in May 2025, and Howdy, launched in August 2025.
Previous wording
Cost of revenue, devices decreased by $28.8 million, or 21%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The decrease was driven by lower freight costs of $35.5 million, primarily due to an International Emergency Economic Powers Act (“IEEPA”) refund for tariff payments made in previous quarters, partially offset by a $10.2 million increase in inventory reserves.
Current wording
Cost of revenue, devices increased by $22.3 million, or 5%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The increase was driven by higher manufacturing costs of $46.5 million and a $17.8 million increase in inventory reserves, which were partially offset by lower freight costs of $37.1 million, primarily due to an International Emergency Economic Powers Act (“IEEPA”) refund for tariff payments made in previous quarters.
Previous wording
Research and development expenses increased by $1.7 million, or 1%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The increase was primarily driven by higher cloud hosting and consulting expenses of $5.9 million, partially offset by lower personnel expenses of $4.9 million due to decreases in stock-based compensation expense.
Current wording
Research and development expenses increased by $4.6 million, or 3%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The increase was primarily driven by higher cloud hosting and consulting expenses of $9.8 million, partially offset by lower personnel expenses of $5.4 million due to decreases in stock-based compensation expense.
Previous wording
Research and development expenses increased by $6.6 million, or 2%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The increase was driven by higher cloud hosting and consulting expenses of $9.6 million and higher facilities and IT expenses of $5.3 million, partially offset by lower personnel expenses of $7.1 million due to decreases in stock-based compensation expense.
Current wording
Research and development expenses increased by $11.2 million, or 2%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The increase was driven by higher cloud hosting and consulting expenses of $19.4 million and higher facilities and IT expenses of $6.1 million, partially offset by lower personnel expenses of $12.5 million due to decreases in stock-based compensation expense.
Previous wording
Sales and marketing expenses decreased by $20.0 million, or 8%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The decrease was primarily driven by lower marketing expenses of $28.5 million, partially offset by a $7.0 million increase in personnel expenses.
Current wording
Sales and marketing expenses decreased by $51.2 million, or 21%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The decrease was primarily driven by lower marketing expenses of $42.1 million and a $19.2 million credit related to the buyout of previously impaired floors of a corporate office. This decrease was partially offset by a $9.5 million increase in personnel expenses.
Previous wording
Sales and marketing expenses decreased by $22.5 million, or 5%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The decrease was primarily driven by lower marketing expenses of $37.3 million, partially offset by a $6.8 million increase in personnel expenses and a $4.6 million increase in intangible amortization from our Frndly acquisition.
Current wording
Sales and marketing expenses decreased by $73.7 million, or 10%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The decrease was primarily driven by lower marketing expenses of $79.4 million and a $19.2 million credit related to the buyout of previously impaired floors of a corporate office. This decrease was partially offset by a $16.3 million increase in personnel expenses and a $4.4 million increase in facilities and IT expenses.
Previous wording
General and administrative expenses increased by $24.9 million, or 25%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The increase was primarily due to $18.7 million of merger-related costs incurred in connection with our proposed transaction with Fox, and the recognition of $13.4 million in non-income based taxes, partially offset by a decrease in other legal and consulting expenses of $9.7 million.
Current wording
General and administrative expenses increased by $15.6 million, or 17%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The increase was primarily due to $13.4 million of merger-related costs incurred in connection with our proposed transaction with Fox.
Previous wording
General and administrative expenses increased by $32.8 million, or 17%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The increase was primarily due to $18.7 million in merger-related costs incurred in connection with our proposed transaction with Fox, and a $23.2 million increase in non-income based taxes, partially offset by a decrease in other legal and consulting expenses of $12.8 million.
Current wording
General and administrative expenses increased by $48.4 million, or 17%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The increase was primarily due to $32.1 million in merger-related costs incurred in connection with our proposed transaction with Fox, a $25.4 million increase in non-income based taxes, and a $3.3 million increase in personnel costs, partially offset by a decrease in other legal and consulting expenses of $18.3 million.
Previous wording
Total other income, net, decreased by $4.8 million, or (17)%, during the three months ended June 30, 2026 as compared to the three months ended June 30, 2025. The decrease was primarily due to a $3.2 million unrealized gain recognized during the three months ended June 30, 2025 on our strategic investment in convertible promissory notes.
Current wording
Total other income, net, decreased by $5.3 million, or 19%, during the three months ended September 30, 2026 as compared to the three months ended September 30, 2025. The decrease was primarily due to a $2.8 million unrealized gain recognized during the three months ended September 30, 2025 on our strategic investment in convertible promissory notes.
Previous wording
Total other income, net, increased by $14.9 million, or 33%, during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. The increase was primarily due to a gain on the sale of strategic investments of $13.4 million.
Current wording
Total other income, net, increased by $9.6 million, or 13%, during the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025. The increase was primarily due to a gain on the sale of strategic investments of $13.4 million.
Previous wording
As of June 30, 2026, we had cash and cash equivalents of $2,001.8 million and short-term investments of $555.4 million. Approximately 4% 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.
Current wording
As of September 30, 2026, we had cash and cash equivalents of $2,518.8 million and short-term investments of $201.8 million. Approximately 4% 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.
Previous wording
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. Our future capital requirements, the adequacy of available funds, and cash flows from operations could be affected by various risks, uncertainties, including, but not limited to, those detailed in Part II, Item 1A, Risk Factors in this Quarterly Report and the effects of the current macroeconomic environment. While the current macroeconomic environment has not severely impacted our liquidity and capital resources to date, it has contributed to disruption and volatility in local economies and in capital and credit markets, which could adversely affect our liquidity and capital resources in the future.
Current wording
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. Our future capital requirements, the adequacy of available funds, and cash flows from operations could be affected by various risks and uncertainties, including, but not limited to, those detailed in Part II, Item 1A, Risk Factors in this Quarterly Report and the effects of the current macroeconomic environment. While the current macroeconomic environment has not severely impacted our liquidity and capital resources to date, it has contributed to disruption and volatility in local economies and in capital and credit markets, which could adversely affect our liquidity and capital resources in the future.
Previous wording
We had outstanding letters of credit secured by the Credit Agreement of $39.5 million as of June 30, 2026. As of June 30, 2026, we had not borrowed against the Credit Agreement, and we were in compliance with all of the covenants of the Credit Agreement. See Note 11 to our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report for additional details.
Current wording
We had outstanding letters of credit secured by the Credit Agreement of $32.2 million as of September 30, 2026. As of September 30, 2026, we had not borrowed against the Credit Agreement, and we were in compliance with all of the covenants of the Credit Agreement. See Note 11 to our Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report for additional details.
Previous wording
Cash provided by operating activities increased in the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to net income of $249.9 million in the current year, compared to a net loss of $16.9 million in the prior year.
Current wording
Cash provided by operating activities increased in the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to net income of $433.3 million in the current year, compared to a net income of $7.9 million in the prior year.
Previous wording
Net cash provided by investing activities increased during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 due primarily to the sales and maturities of short-term investments, net of purchases, of $175.0 million and sale of strategic investments of $18.4 million. The increase was partially offset by purchases of property and equipment of $6.9 million.
Current wording
Net cash provided by investing activities increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 due primarily to the sales and maturities of short-term investments, net of purchases, of $525.0 million and sale of strategic investments of $18.4 million. The increase was partially offset by purchases of property and equipment of $8.3 million.
Previous wording
Net cash used in financing activities increased during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to $162.7 million in repurchases of our common stock, tax payments of $110.8 million to net settle equity awards vested during the period, and payment of contingent consideration related to the acquisition of Frndly TV of $15.2 million, partially offset by proceeds from the exercise of employee stock options of $36.6 million.
Current wording
Net cash used in financing activities increased during the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to $162.7 million in repurchases of our common stock, tax payments of $167.6 million to net settle equity awards vested during the period, and payment of contingent consideration related to the acquisition of Frndly TV of $15.2 million, partially offset by proceeds from the exercise of employee stock options of $43.2 million.