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State of the Screens

Can Roku Win Small Business?

By November 17, 2021No Comments

Key numbers from Roku’s earnings:
1) 1.3M
active accounts added in Q3
2) 56.4M
total active accounts
3) 82%
YoY increase in advertising revenue
4) 50%
YoY increase in ad revenue per hour of streaming

PSA #1: Roku’s advertising business is growing at an increasing rate.  The growth rate (82%) is faster than the previous three years (78%, 79%, and 74%)

PSA #2: Roku’s advertising revenue per streaming hour is growing at the fastest rate of any Q3!

KennyPowers

Flashback: Can Roku Keep Rising?

Big picture: We continue to believe $0.05 per hour is attainable in the near term for any streaming service that combines targeting with measurement.  Roku generates ≈ 60% of linear TV’s ad revenue/hour with ≈ 25% of the ad load.

SOTS224-1

Roku active accounts (YoY growth):
1) 2016-Q3 – 11.3M
2) 2017-Q3 – 16.7M (↑ 48%)
3) 2018-Q3 – 23.8M (↑ 43%)
4) 2019-Q3 – 32.3M (↑ 36%)
5) 2020-Q3 – 46.0M (↑ 42%)
6) 2021-Q3 – 56.4M (↑ 23%)

Roku advertising revenue (YoY growth):
1) 2016-Q3 – $22M
2) 2017-Q3 – $58M (↑ 158%)
3) 2018-Q3 – $100M (↑ 74%)
4) 2019-Q3 – $179M (↑ 79%)
5) 2020-Q3 – $319M (↑ 78%)
6) 2021-Q3 – $583M (↑ 82%)

Roku advertising revenue per account (YoY growth):
1) 2016-Q3 – $1.97
2) 2017-Q3 – $3.44 (↑ 75%)
3) 2018-Q3 – $4.21 (↑ 22%)
4) 2019-Q3 – $5.55 (↑ 32%)
5) 2020-Q3 – $6.94 (↑ 25%)
6) 2021-Q3 – $10.33 (↑ 49%)

Roku streaming hours per account (YoY growth):
1) 2016-Q3 – 212
2) 2017-Q3 – 287 (↑ 35%)
3) 2018-Q3 – 261 (↓ 9%)
4) 2019-Q3 – 319 (↑ 22%)
5) 2020-Q3 – 322 (↑ 1%)
6) 2021-Q3 – 319 (1%)

Roku advertising revenue per streaming hour (YoY growth):
1) 2016-Q3 – $0.009
2) 2017-Q3 – $0.012 (↑ 29%)
3) 2018-Q3 – $0.016 (↑ 35%)
4) 2019-Q3 – $0.017 (↑ 8%)
5) 2020-Q3 – $0.022 (24%)
6) 2021-Q3 – $0.032 (50%)

 

Smart: Roku launched a Shopify app targeting their 1.7M merchants.

Quote from Rob Aksman – Co-Founder and CEO @ Brightline:
“If I’m a company like Roku looking for my next big revenue story, that’s a nice big nut to crack.”

 

More: The Rundown: Roku’s audience, revenue, and viewership continue to grow, but it’s dealing with supply chain challenges

Michael Beach

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.