Roku Q2 Profit Jumps 1,464% With Fox Acquisition Looming

Roku reported a profit of $164.2 million, or $1.08 per share, and revenue of $1.35 billion, compared to earnings of 56 cents per share and revenue of $1.3 billion expected by Wall Street analysts The streaming device and hardware maker did not provide an updated financial outlook due to Fox’s pending $22 billion acquisition Roku shares climbed 0.16% in after-hours trading following the release of the quarter’s results Roku’s second-quarter profit surged 1,464% to $164.2 million, or $1.08 per share, as total revenue grew 22% to $1.35 billion, driven by momentum in subscriptions and advertising revenues and profits in its platform and devices units. Platform revenue grew 25% to $1.22 billion, while profits climbed 30% to $646.8 million, driven by a 39% increase in ad revenue and 16% increase in subscription revenue. The company, which reaches over 100 million streaming households worldwide, grew total streaming hours 7% to 37.9 billion during the quarter, with the gains primarily driven by viewership of the NBA playoffs and World Cup. It also launched Fox One and Peacock as add-ons in its premium subscriptions offering and saw hundreds of thousands of sign-ups through Soccer Zone in the Roku Sports Experience. Roku completed the rollout of its new home screen in the U.S. during the third quarter and said the results of the update have been “encouraging.” More than half of U.S. broadband households use Roku’s home screen. It will also roll out new DVR features in the coming months. Additionally, the company continues to scale its premium, ad-free streaming service Howdy, which launched a standalone mobile app and as an add-on in Prime Video. Meanwhile, the devices business swung to a profit of $26.9 million, but revenue tumbled 1% to $133.7 million. The segment benefitted from a tariff refund for payments made between the second quarter of 2025 and first quarter of 2026. Roku-made TVs accounted for 5% of total TV unit sales volume in the U.S. during the quarter, driven by strength at Amazon and Best Buy and the continued ramp of Hiro Roku TV models at Target. The latest quarterly results come as Fox is set to acquire the company in a pending $22 billion deal, which is slated to close in the first half of 2027. As a result of the deal, Roku did not hold a conference call with analysts or offer a financial outlook. Roku previously forecasted that platform revenue would grow 21% to $5 billion for the full year, while devices revenue would come in at approximately $535 million, resulting in total revenue of $5.5 billion. It also anticipated mid-single-digit year over year operating expense growth for 2026 and said it was on track to drive double-digit platform growth and achieve $1 billion in free cash flow by 2028. More to come…