Advanced Television

Roku passes 80m active accounts; Challenges ahead

February 16, 2024

Roku has reported more than 80 million active accounts and counting as consumers continue to move to TV streaming.

Viewer engagement on Roku is also at a record high; for the first time, more than 100 billion hours were streamed on the platform in 2023, averaging a record of 4.1 hours per day per account in Q4. Additionally, in the US, Roku’s active account base is now bigger than the subscribers of the six largest traditional pay-TV providers combined, according to Leichtman Research Group.

Total net revenue was ti $3.5 billion, up 11 per cent year over year. Platform revenue was at $3 billion, up 10 per cent.

“As the leading TV streaming platform, Roku aims to make television better for everyone,” said Anthony Wood, Founder and CEO, Roku. “In a world where one day all TV will be streamed, we’re immensely proud to be the programmer of the home screen for more than 80 million active accounts around the globe, connecting people directly to what they love to watch.”

In 2023, Roku launched its own line of TVs and expanded the Roku TV licensing programme to include more than 30 partners, furthering the reach of the Roku Operating System (OS). In select markets, user experience updates, new features, and content discovery tools like the Sports Experience, What to Watch, All Things Food and All Things Home were added to the platform. These enhancements, plus a more informative and engaging Roku search, have led to increased time spent on the platform and a more fluid experience for the Roku user.

The company said that “this continued growth helps [Roku] on its mission to be the global TV streaming platform that connects and benefits the entire TV ecosystem, connecting content partners to an engaged audience and providing advertisers with unique capabilities to reach viewers”.

In a letter to shareholders, Roku said: “We are executing well and ended 2023 with 80 million Active Accounts globally and our first year of more than 100 billion Streaming Hours. We grew monetisation with Platform revenue up double digits YoY in both Q4 and full year 2023. We also achieved positive Adjusted EBITDA and Free Cash Flow for 2023 — a year ahead of schedule. From this position of improved operational efficiency, we are focusing more of our management attention in 2024 on innovation and growth. There are more opportunities to help our viewers find content across the streaming universe, in ways that are engaging and entertaining, while also driving monetisation.”

The letter continued: “We were pleased with our net adds despite overall TV unit sales in the US being down YoY in Q4, due to LCD panel prices that increased YoY leading to smaller TV price discounts for consumers. Roku continued to benefit from consumers’ focus on value, and the Roku operating system (OS) was the #1 selling TV OS in the US for the fifth year in a row. We have also driven strong results internationally as we continue to expand our Roku TV licensing programme.”

Looking ahead, the company said: “We plan to increase revenue and free cash flow and achieve profitability over time. At the same time, we remain mindful of near-term challenges in the macro environment and an uneven ad market recovery. While we will face difficult YoY growth rate comparisons in streaming services distribution and a challenging M&E environment for the rest of the year, we expect to maintain our Q4 2023 YoY Platform growth rates in Q1. This will result in Total net revenue of $850 million, total gross profit of roughly $370 million, and break-even Adjusted EBITDA in Q1. Continuing our performance from 2023, we expect to deliver positive Adjusted EBITDA for full year 2024.”

In conclusion, the company said: “For 2024 and beyond, there are two industry trends that are particularly important for Roku. The first is the enormous volume of content and live events on streaming. We have an inherent advantage as the programmer of the home screen to help our viewers find what they want to watch, while simultaneously growing our monetisation. This is a big opportunity for Roku. Second, streaming services are focused on building successful ad-supported options for consumers, and this will further accelerate the overall shift of ad dollars from traditional TV to streaming. Roku has the tools and expertise to drive engagement, which is critical in an ad-supported environment. With our platform advantages, first-party relationship with 80 million active accounts, and deep user engagement, we are well-positioned to accelerate revenue growth in future years.”

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