$ROKU · ROKU, INC
Roku reported Q3 FY2026 results on November 2, 2026, with total net revenue of $1.502B (+24% YoY), net income of $183.3M (+639% YoY), and diluted EPS of $1.20. Platform revenue grew 23% to $1.308B, while Adjusted EBITDA hit $248.8M with a 16.6% margin. The company withheld forward guidance due to its pending acquisition by Fox Corporation, announced June 15, 2026.
- Total net revenue of $1.502B, up 24% YoY, with Platform revenue up 23% to $1.308B.
- Net income surged 639% YoY to $183.3M; diluted EPS of $1.20 vs. $0.16 a year ago.
- Adjusted EBITDA reached $248.8M (16.6% margin), up 113% YoY; free cash flow (TTM) hit $795.7M.
- Advertising revenue grew 23% YoY to $727.4M with gross margin expanding 470 bps to 63.2%.
- Devices gross margin swung to -25.1% from -15.7% YoY, driven by elevated memory costs.
Extended-hours trading shows ROKU at $154.76, down 0.49% from the regular close of $155.52. The modest dip likely reflects the absence of forward guidance — Roku withheld its outlook due to the pending FOX acquisition — muting enthusiasm around the strong Q3 beat.
Roku's Q3 results show accelerating profitability at scale, but the FOX acquisition overhang and withheld guidance leave the investment case in limbo.
Roku's 23% advertising growth outpaced the broader U.S. OTT and digital ad market, per SMI data cited in the letter. The Roku Channel ranked as the #2 app by engagement globally, reinforcing its position as a top CTV platform amid intensifying competition from Amazon, Google, and Apple.
Devices gross margin deteriorated sharply to -25.1% from -15.7% YoY on elevated memory costs, and subscriptions gross margin compressed 180 bps to 40.9% due to a strategic mix shift toward lower-margin Premium Subscriptions. The pending FOX acquisition creates uncertainty around standalone execution and integration risk.