Roku Hits 32 Million Users as It Focuses on Ads

Photographed by Ryan Young
Roku CEO Anthony Wood

The company had net revenue of $260.9 million in the third quarter, up 50 percent from a year prior.

The streaming video platform Roku on Wednesday said it now has 32.3 million active users, 1.7 million more than last quarter and 36 percent more than it had a year ago.

At the same time, the company revealed in its third-quarter earnings report that the number of streaming hours on the platform had hit 10.3 billion, up 68 percent from a year ago. The company had net revenue of $260.9 million in the quarter, up 50 percent from a year prior.

All of that growth essentially came from the company’s platform division, which includes its advertising business. Roku’s platform revenue grew by 79 percent year-over-year to $179.3 million, while its hardware revenue grew only by 11 percent to $81.6 million. The company said that it introduced a new low-cost Roku player in the quarter, which could impact hardware revenue.

“Our goal is to drive scale and reach of the platform and we will do so by offering consumers exceptional devices and appealing prices rather than optimizing for hardware gross profit,” Roku CEO Anthony Wood wrote Wednesday in a letter to shareholders.

To help further its advertising goals, Roku last month announced its intent to acquire the demand-side advertising platform Dataxu, and the company told its shareholders that the DSP will be a key part of its ad strategy going forward.

The ultimate goal? To become a “one-stop shop” for digital video ad buyers. Wood wrote in the shareholder letter that Roku is committed to being an open platform and to working with many DSPs.

"At the same time, the acquisition of Dataxu will help accelerate our advertising product roadmap and our strategy of providing marketers with an integrated, data-driven solution to plan, buy, and optimize their ad spend across TV and OTT," he added. "Automated media buying solutions like Roku’s new DSP are expected to unlock more advertising investment into OTT."