Roku Q3 Revenue Rises 24.1% to $1.50 Billion as Net Income Jumps to $183.3 Million
Roku's third-quarter net income jumped to $183.3 million from $24.8 million a year earlier as revenue grew 24.1%, with the streaming company reporting results while its acquisition by Fox Corporation is pending.
Total net revenue rose to $1.50 billion from $1.21 billion, according to the shareholder letter Roku filed with an 8-K on Monday. Diluted earnings were $1.20 per share, up from $0.16. Income from operations climbed to $164.1 million from $9.5 million.
Because of the pending FOX deal, Roku said it will not host an earnings call and will not provide a financial outlook. The companies announced the agreement on June 15, 2026. Roku said it remains on track for the second-half 2026 forecast it provided in the proxy statement for the deal.
Platform carries the quarter
Platform revenue, which includes advertising and subscriptions, rose 22.9% to $1.31 billion. Advertising revenue grew 23.0% to $727.4 million, Roku's ninth straight quarter of double-digit growth, and its gross margin improved to 63.2% from 58.4%. Subscriptions revenue increased 22.7% to $580.9 million, though that gross margin slipped to 40.9% from 42.7% as the mix shifted toward Premium Subscriptions.
Streaming hours rose 9% to 39.9 billion, and The Roku Channel was the No. 2 app on the platform by engagement in the U.S. and globally.
"We are building a diversified and durable business by focusing on monetization initiatives," founder and CEO Anthony Wood and CFO and COO Dan Jedda wrote in the letter, citing deeper ties to third-party advertising platforms, growth in Roku-billed subscriptions and improvements to the Roku Experience.
Devices squeezed by memory costs
Devices revenue rose 32.7% to $193.7 million, but the segment posted a gross loss of $48.6 million, a gross margin of negative 25.1%, which Roku said was driven primarily by elevated memory costs. Roku-made TVs beat the company's expectations in the quarter, and it launched its first OLED TVs in September.
Total gross profit rose 23.5% to $648.5 million, for a gross margin of 43.2%.
Costs and cash
Operating expenses fell 6% to $484.4 million, led by a 21% drop in sales and marketing. Roku said it still expects distribution costs for Roku TV models, a large part of sales and marketing expense, to be weighted toward the fourth quarter.
Adjusted EBITDA rose 112.8% to $248.8 million from $116.9 million, a 16.6% margin. Trailing 12-month free cash flow reached $795.7 million, up from $443.0 million.
By the numbers
- Total net revenue: $1.50 billion, up 24.1%
- Diluted EPS: $1.20, up from $0.16
- Platform revenue: $1.31 billion, up 22.9%
- Advertising gross margin: 63.2%
- Streaming hours: 39.9 billion, up 9%
- Adjusted EBITDA: $248.8 million
Sources
- Roku Form 8-K with third-quarter 2026 shareholder letter, filed Nov. 2, 2026 (accession 0001628280-26-068877)
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