Roku heads into its Fox acquisition with a strong final stretch. The platform company reported third-quarter revenue of $1.50 billion, up 24% year over year. Gross profit rose 24% to $649 million, and net income reached $183 million — more than seven times the prior-year quarter.
Platform revenue, the core of Roku’s business, grew 23% to $1.3 billion. Advertising and subscriptions each grew 23% as well. Total streaming hours across Roku hit 39.9 billion, up 9% from a year earlier.
Entertainment ads lead the growth
The clearest signal for ScreenStat readers is in media and entertainment advertising. Roku says M&E revenue growth hit its highest year-over-year level in four years, “as media companies invested on the Roku platform to promote their content and services.” Political advertising also ran above the comparable quarter from the 2024 U.S. presidential election cycle.
For entertainment marketers, that is not a vendor talking point. It is a budget signal. Film, series and streaming services are spending on connected TV to acquire and retain audiences, and Roku is capturing that demand through its platform rather than just selling boxes.
Hardware remains a loss leader
Devices revenue rose 33% to $194 million, but the segment posted an operating loss of $48.6 million and a negative 25% gross margin, driven mostly by higher memory costs. Roku has long used devices as a loss leader: subsidise the hardware, build a large audience, then monetise through advertising and subscriptions. Q3 shows the trade-off still works, because platform growth far outweighs the device loss.
What the Fox deal means
Fox Corp. agreed to buy Roku for $22 billion on June 15, with the transaction expected to close in the first half of 2027. Because of the pending deal, Roku is not holding an earnings call or giving financial guidance, so this quarter arrives without forward numbers.
In a shareholder letter, CEO Anthony Wood and CFO/COO Dan Jedda called the Fox takeover “an extraordinary opportunity to accelerate our vision, allowing us to scale faster and innovate more aggressively for viewers, partners and advertisers.” They also outlined the monetisation levers: deeper integrations with third-party ad platforms, more Roku-billed subscriptions, and improvements to the Roku Experience.
What to watch
- Media and entertainment ad growth on CTV is at a four-year high; this is a benchmark for where content promotion budgets may shift.
- Roku-billed subscriptions and third-party ad integrations are the two monetisation threads to follow into the Fox integration.
- The device business is intentionally unprofitable, but memory-cost pressure is worth monitoring if losses widen.
For media planners, entertainment marketers and platform teams, the quarter is less about one beat and more about direction. Roku is scaling ad and subscription revenue quickly, with Fox’s content and distribution assets set to follow in 2027.
Source: Variety
