Can Strong Platform Revenues Support Further Upside in Roku Stock?

Roku's ROKU platform revenues are driven by advertising activities and streaming services distribution. Advertising includes video ads delivered across the Roku platform and The Roku Channel, while streaming services distribution covers revenues from Premium Subscriptions, transaction fees on content purchases and Roku-billed subscriptions. This dual revenue structure provides diversification and gives Roku multiple levers to drive platform growth.Advertising remains the key driver of platform momentum. Roku has expanded integrations with major demand-side platforms such as Amazon DSP, Trade Desk and FreeWheel, allowing advertisers to access inventory through preferred buying channels. Programmatic transactions account for a rising share of video ad impressions, improving demand access and monetisation efficiency. Roku Ads Manager is broadening the advertiser base by attracting small and medium-sized businesses and performance marketers. Nearly 90% of advertisers using Ads Manager are new to Roku, pointing to incremental demand rather than dependence on traditional brand budgets. Video advertising growth continues to outpace the broader U.S. OTT and digital advertising markets, supporting visibility into platform revenue trends.Streaming services distribution adds a second growth driver. Subscriptions are benefiting from improved content discovery and AI-powered recommendations that support higher conversions. Roku’s 2026 content slate is expected to strengthen The Roku Channel with originals such as Broad Trip, The Laguna Beach Reunion and The Great American Baking Show Season 2, alongside third-party titles including The Spiderwick Chronicles and Die Hart Season 3. Engagement is expected to be further supported by The Roku Sports Channel, which features MLB Sunday Leadoff, NBA G League and Formula E content. Howdy, Roku’s $2.99 ad-free subscription service with nearly 10,000 hours of content targets a value-focused audience and expands monetisation opportunities.The Zacks Consensus Estimate for fourth-quarter 2025 platform revenues is pegged at $1.12 billion, indicating 14.5% year-over-year growth. With advertising execution and subscription expansion progressing together, Roku’s platform revenues appear well-positioned to support further upside.ROKU Faces Intensifying CompetitionRoku’s platform competes with Netflix NFLX and Disney DIS as both expand ad-supported streaming and subscription monetization. Netflix is scaling its ad tier alongside subscriptions, while Netflix continues to monetise viewing inside its own app. Disney follows a similar path across Disney+ and Hulu, with Disney using premium content to support ads and subscriptions. Unlike Netflix and Disney, Roku monetises viewing across apps at the platform level rather than single-service control models.ROKU’s Share Price Performance, Valuation & EstimatesROKU shares have risen 27.5% in the past six months, outperforming the Zacks Broadcast Radio and Television industry’s decline of 15.5% and the Zacks Consumer Discretionary sector’s plunge of 6.7%.ROKU’s Price PerformanceImage Source: Zacks Investment ResearchFrom a valuation standpoint, Roku stock is currently trading at a forward 12-month Price/Sales ratio of 3.11X compared with the industry’s 4.3X. ROKU carries a Value Score of D.ROKU’s ValuationImage Source: Zacks Investment ResearchThe Zacks Consensus Estimate for ROKU’s fourth-quarter 2025 earnings is pegged at 28 cents per share, unchanged over the past 30 days. The earnings figure suggests improvement over the year-ago quarter’s loss of 24 cents per share.Roku, Inc. Price and Consensus Roku, Inc. price-consensus-chart | Roku, Inc. 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