Roku Inc (ROKU)

[Monksdream]

Streaming Is Disrupting Traditional Media
ARK Invest_Headshot_Nick Grous_Edit 5 By Nicholas Grous | @GrousARK
Associate Portfolio Manager
Last week, Roku reported1 better-than-expected revenue and earnings for the second quarter. Given its strong revenue growth, expanding user base, and steady gains in market share, we believe that the Roku platform is causing and capitalizing on dramatic shifts in media consumption. Investors interested in learning more about ARK’s Roku research are welcome to access our open-source Roku model and blog.2

Disrupting Traditional TV Viewing
Streaming was transforming the TV industry during the second quarter:

Global Streaming Hours: Roku's global streaming hours grew by 21% year-over-year,3 while traditional TV viewing in the US declined by 13%, as reported by Nielsen.
Ad Spend on Traditional TV: Traditional TV ad spend declined 9.4% year-over-year, while the spot, or scatter, ad market dropped 17.2% year-over-year, according to SMI data. In contrast, Roku’s platform revenue increased 11%.4
Roku’s User Engagement And Expansion During The Second Quarter

Active Accounts: active accounts increased by 1.9 million to reach 73.5 million, up 16% year-over-year. Roku also gained share across the range of TV sizes. The large screen segment grew ~70% year-over-year,5 pushing the Roku operating system’s (OS) already leading TV OS even higher into #1 territory in the US.
Streaming Hours on The Roku Channel: streaming hours on The Roku Channel grew by more than 50% year-over-year and, according to Nielsen, represented 1.1% of total US TV viewing in May, ranking The Roku Channel alongside Peacock and close to HBO Max.