Roku, Inc (ROKU) · Nov 2, 2026 · Earnings
Beat — Diluted EPS $1.20 vs ~$0.55 consensus; revenue $1.50B vs ~$1.41B
Roku earnings beat Q3 expectations on 23% platform growth and sharply higher profit, though hardware margins deteriorated on memory costs.
Roku entered the quarter as a scaled connected-TV platform monetizing viewers through advertising and subscriptions, while its pending FOX acquisition has shifted the long-term story toward integration and regulatory execution. The deal was already known, with closing expected in the first half of calendar 2027; the DOJ’s additional-information request remains part of that process.
The operating business beat a lowered-information setup clearly. Roku delivered $1.50 billion of revenue versus published consensus of roughly $1.41 billion and diluted EPS of $1.20 versus roughly $0.55. Revenue was up 24% year over year, while platform revenue grew 23% to $1.31 billion.
| Q3 2026 | Q3 2025 | Consensus | |
|---|---|---|---|
| Total net revenue (Income Statement) | $1,502.0M (+24%) | $1,210.6M | ~$1,410M |
| Platform revenue (Financial Highlights) | $1,308.3M (+23%) | $1,064.6M | |
| Advertising revenue (Advertising) | $727.4M (+23%) | $591.2M | |
| Subscriptions revenue (Subscriptions) | $580.9M (+23%) | $473.4M | |
| Diluted EPS (Income Statement) | $1.20 | $0.16 | ~$0.55 |
| Adjusted EBITDA (Adjusted EBITDA reconciliation) | $248.8M (+113%) | $116.9M | |
| Total gross margin (Financial Highlights) | 43.2% | 43.4% | |
| Devices gross margin (Devices) | (25.1%) | (15.7%) |
The quality of growth improved on the platform side. Advertising and subscription revenue both rose 23%, but advertising was the better engine: its gross margin expanded to 63.2%, while platform gross margin reached 53.3%. That combination, alongside a 6% reduction in operating expenses, drove operating income to $164 million from just $9 million a year earlier.
Hardware remains the clear offset. Devices revenue grew 33% to $194 million, but the segment returned to a $49 million gross loss as elevated memory costs pushed gross margin down to negative 25.1%. That weakness kept total gross margin essentially flat year over year despite strong platform economics.
The filing does not add a new forward outlook. Roku reaffirmed that it remains on track for the second-half 2026 forecast previously provided in its proxy, but it will not provide a normal financial outlook or host an earnings call because of the FOX transaction. 〔0〕
Bottom line: This was a meaningful earnings beat that strengthens Roku’s core advertising-and-subscription business, with cash generation and profitability accelerating. The main blemish is hardware profitability, but it does not outweigh the platform execution in this quarter.
FOX acquisition closing process, expected first half 2027
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