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美国
证券交易委员会
华盛顿特区20549
表格 10-Q
（标记一）
☒根据1934年证券交易法第13或15(d)节的季度报告
截至季度结束日期的财务报告2024年9月30日
或
☐根据1934年证券交易法第13或15(d)条款的过渡报告
过渡期从 至
委员会档案编号： 001-38211
Roku, Inc.
(根据其章程指定的注册人正式名称)
特拉华州26-2087865
(成立的州或其他地区)
成立或组织证明文件)
(国税局雇主识别号码)
识别号码)
1173 Coleman Avenue
圣荷西, 加利福尼亚州 95110
(主要执行办公室地址，包括邮递区号)
注册人的电话号码，包括区号：(408) 556-9040
根据法案第12(b)条规定注册的证券：
每个类别的标题：交易标的：注册的交易所名称：
A类普通股，每股面值$0.0001ROKU逐笔明细纳斯达克全球精选市场
请勾选以下项目，以判定在过去12个月(或更短期间，该注册人被要求提交报告)内所有根据1934年证券交易法第13条或第15(d)条要求提供报告的报告是否已经提交，并且该注册人在过去90天中是否受到提交报告的要求。 是 否 ☒
请在选框内打勾，确认注册人是否在过去12个月内（或注册人需要提交此类文件更短的期限内）根据Regulation S-t第405条规定提交了必须提交的所有互动数据文件。 是 否 ☒
请勾选指示登记者是否为大型快速提交人、快速提交人、非快速提交人、较小的报告公司或新兴成长型公司。请参阅交易所法规120亿2条，了解「大型快速提交人」、「快速提交人」、「较小的报告公司」和「新兴成长型公司」的定义。
大型加速报告人☒加速归档人☐
非加速归档人☐ 小型报告公司☐
新兴成长型企业☐  
如果是新兴增长型公司，请勾选相应的选项，表示注册人选择不使用遵守根据《交易所法》第13(a)条提供的任何新或修订的财务会计准则的延长过渡期。☐
在核准的名册是否属于壳公司（如股市法规第1202条所定义之意义）方面，请用勾选符号表示。是 ☐ 否 ☒
截至2024年9月30日，登记人持有 127,893,163 A类普通股$0.0001面值每股，以及 17,306,064 B类普通股$0.0001面值每股，均为待发行。

目录
目录
  页面
第一部分。
项目1。
 
 
 
 
 
项目2。
项目3。
项目4。
第二部分。
项目1。
项目1A。
项目2。
项目3。
项目4。
项目5。
第6项。
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目录
精选名词词汇表
在本第10-Q季度报告（“季度报告”）中使用时，除非上下文另有要求，对以下术语的引用具有如下所定义的相应含义。
活跃的账户： 查看串流家庭。
广告支持的点播视讯（AVOD）： 透过广告支持的串流内容，不向观众收取费用。
应用程式： 主要指的是在Roku平台上直接对消费者提供的串流应用程式（例如The Roku Channel或奈飞）。我们也使用“应用程式”来指代移动应用程式（例如我们的Roku智能家居应用程式）。
每用户平均营业收入（ARPU）： 控制项营业收入为过去四个季度之和，除以当前期末及前一年相应期末的Streaming Households数量平均值。请参阅本季度报告中第一部分第2项“管理层讨论和分析财务条件和营运结果”，了解主要绩效指标和非GAAP财务指标的详细信息。
DSP: 需求方平台（例如Roku的OneView广告购买平台），允许数位广告库存的买家透过一个介面管理多个广告交易所和数据交换账户，跨多个平台。
FAST： 免费、广告支持的线性串流电视，不包含按需内容。
授权的Roku TV合作伙伴： 电视原始设备制造商（“OEMs”）授权Roku作业系统并利用我们的智能电视参考设计来制造电视。
线性电视： 一种按特定时间表提供编排节目的电视格式。
高级订阅： 透过The Roku Channel提供的内容合作伙伴（例如Paramount）提供的基于订阅的流媒体服务。
罗姆牌电视： 由Roku设计、制造和销售，并搭载Roku OS的电视。罗姆牌电视包括Roku Select、Roku Plus和Roku Pro系列电视。
Roku主界面： 当观众使用Roku流媒体设备开始流媒体时，首先看到的是第一个屏幕。当按下Roku遥控器上的主页按钮或退出应用程序时，观众也将返回主屏幕。
Roku主画面选单： Roku主画面左侧导览列。
Roku原创节目： 由Roku创建的原创内容节目。
Roku作业系统： Roku作业系统是专为电视而打造，并驱动Roku串流媒体装置。
Roku支付: 我们的计费服务允许流媒体用户保存支付方式，以便在Roku平台上购买时不必重新输入付款信息。它还使用户能够注册某些基于订阅的流媒体服务（包括高级订阅服务）。
Roku电视型号： 由我们授权的Roku电视合作伙伴制造和销售的由Roku OS提供动力的电视。
串流： 透过互联网分发视频、音乐或其他媒体内容。
串流媒体装置： 任何可进行串流的装置。对于 Roku，这包括 Roku 串流播放器、Roku 电视机型和 Roku 品牌的电视。
串流时数： 在特定时期，串流设备在Roku串流平台上串流内容的总时数。有关详细信息，请参阅本季度报告中第一部分第2项《管理层讨论与分析》中的财务状况和营运结果、关键绩效指标和非依据通用会计准则的指标。
流媒体用户（以前是活跃账户）： 在过去30天内在我们平台上串流内容的不同使用者账户数。我们以前将「流媒体用户」称为「活跃账户」。虽然我们已将此术语更改为更能反映我们业务性质的术语，但我们仍使用计算「活跃账户」时使用的相同方法来计算。详细内容请参见本季度报告中第I部分第2项《管理层的讨论与分析》的财务状况和业务营运结果、主要绩效指标和非依照通用会计准则衡量的指标。
流媒体平台： 透过互联网连接将观众体验和流媒体应用程序（例如Roku频道和奈飞）传送到用户的电视的技术。
串流播放器： 透过HDMI连接到电视，使电视能够串流播放的设备（例如Roku Express、Roku Express 0.4万、Roku Streaming Stick 0.4万、Roku Ultra、Roku Streambar和Roku Streambar Pro）。
智能电视： 一种透过作业系统（例如，Roku OS）连接到互联网的电视。
订阅视讯点播（SVOD）： 即时串流内容可按需观看，需付费订阅，并可有广告支持或无广告。
电视串流： 在电视上通过互联网串流内容的行为。
The Roku Channel: Roku拥有和营运的流媒体概念。The Roku Channel在The Roku Channel应用程式中整合了三种类型的内容——AVOD，FASt和高级订阅——并通过整合在Roku平台上的观看体验（例如，在Roku首页屏幕选单上的直播电视）来聚合这些内容。
ii
目录
关于前瞻性陈述的备注
本季报告中包含根据1933年证券法（经修订的“证券法”）第27条和1934年证券交易法（经修订的“交易所法”）第21E条所披露的有关我们和我们行业的前瞻性陈述，涉及重大风险和不确定性。本季报告中除历史事实陈述外的所有陈述，包括有关我们未来营运业绩和财务状况、业务策略和管理层对未来营运的计划和目标的陈述，均属前瞻性陈述。在某些情况下，前瞻性陈述可通过“旨在”、“预计”、“相信”、“持续”、“可能”、“设计”、“开发”、“估计”、“预期”、“打算”、“可能性”、“预测”、“项目”、“应该”、“将”、“将会”、“目标”或这些术语的否定形式或其他类似的表达方式来辨识。我们提醒您，前述可能不包含本季报告中提出的所有前瞻性陈述。
前瞻性声明基于我们管理层的信念和假设以及目前可用的信息。这些前瞻性声明受到许多已知和未知的风险、不确定因素和假设的影响，包括本季度报告中标题为“风险因素”部分以及其他地方描述的风险，涉及等事项：
•我们的财务表现，包括我们的营业收入、营业成本、营业费用、盈利能力，以及我们的关键绩效指标（包括串流家庭、串流时数、ARPU和自由现金流）；
•宏观经济条件、不确定性和地缘政治冲突对我们的业务、运营、以及我们和广告商、内容合作伙伴、授权 Roku 电视合作伙伴、其他设备许可方、制造商、供应商、零售商和观众所在的市场和社区产生的影响;
•我们吸引和留住观众，增加串流时数的能力；
•我们能够吸引和保留购买The Roku Channel视频广告库存、我们通过串流服务发行协议获取的平台上的其他视频广告库存以及苹果-显示屏和屏幕保护程式上的本地显示广告的广告商才能。
•我们吸引和留住电视品牌、制造业合作伙伴和服务运营商授权和部署我们的技术的能力；
•我们在流媒体平台上生产或取得流行内容发行权利的能力，或以有利条款进行，或根本无法进行，包括与内容合作伙伴续签现有协议；
•电视收视习惯的变化和电视流媒体的增长；
•我们相关市场的增长，包括电视串流平台广告支出的增长，以及我们成功在这些市场上发展业务的能力；
•我们对不断变化的市场条件和技术发展的适应能力；
•我们有能力开发和推出新产品，并提供附属服务和支援；
•我们整合所收购的企业、产品和技术的能力；
•我们有能力将我们的产品和服务扩展到相邻市场，在这些市场扩大我们的业务规模，并长期以来实现盈利。
•我们有竞争效力，能够有效地与现有竞争对手和新市场进入者竞争；
•我们成功管理国内和国际扩张的能力；
•我们吸引和留住合格员工和关键人员的能力；
•我们能够应对涉及我们产品、系统和运营的潜在和实际网络安全概念事件和系统故障；
•我们维护、保护和加强我们的知识产权的能力；
•我们获得融资的能力是否有利条件，或者根本无法获得；
•我们能够管理产品的销售价格，以增加串流家庭；并
•我们有能力遵守目前适用或可能适用于我们业务的法律和法规，无论是在美国还是国际上，包括遵守隐私和数据保护法规。
财报的其他板块可能包括可能损害我们业务和财务表现的额外因素。此外，我们在一个竞争激烈且快速变化的环境中运营。新的风险因素不时浮现，我们的管理层无法预测所有风险因素，也无法评估所有因素对我们业务的影响，或任何因素或多个因素可能导致实际结果与任何前瞻性陈述中包含的结果不同，或被其暗示。
您不应当将展望性陈述视为未来事件的预测。我们无法保证展望性陈述中所反映的事件和情况将会实现或发生。虽然我们认为展望性陈述中所反映的期望是合理的，但我们无法保证未来的结果、活动水平、表现或成就。除非法律要求，我们不承担在本季度报告日期之后基于任何原因公开更新任何展望性陈述的义务，也不使这些陈述符合实际结果或我们期望的变化。您应当阅读这份季度报告，以及引用并作为本季度报告附件提交的文件，明白我们的实际未来结果、活动水平、表现和成就可能与我们的预期大不相同。我们通过这些警语陈述来限制所有我们的展望性陈述。
投资者及其他人员应注意，我们可能会使用我们的投资者关系网站（roku.com/investor）、我们的博客（roku.com/blog）、美国证券交易委员会（"SEC"）的申报、网络广播、新闻稿和电话会议来公告重要的业务和财务信息给我们的投资者。我们使用这些媒介来与投资者和公众沟通我们公司、产品和服务以及其他议题。我们提供的信息可能被视为重要信息。因此，我们鼓励投资者、媒体和对我们公司感兴趣的其他人员查阅我们在投资者关系网站上发布的信息。Roku、Roku标志以及本报告中出现的其它Roku的商标、商号或服务标志为Roku的财产。本报告中出现的其它公司的商标、商号和服务标志为各自持有人的财产。
iii
目录
第一部分 - 财务资讯
项目1. 基本报表
ROKU, INC.
缩短的合并资产负债表
(以千为单位，除每股面值资料外)
(未审核)
 截至
 2024年9月30日2023年12月31日
资产
流动资产：
现金及现金等价物$2,126,974 $2,025,891 
结余应收帐款$38,143 15.134,127 截至2024年6月30日。
729,911 816,337 
分别为2023年12月31日和2024年9月30日
存货191,213 92,129 
预付费用及其他流动资产138,332 138,585 
全部流动资产3,186,430 3,072,942 
物业及设备，扣除折旧后净值222,999 264,556 
营运租赁权使用资产314,326 371,444 
内容资产净值247,379 257,395 
无形资产，扣除累计摊销31,026 41,753 
商誉161,519 161,519 
其他非流动资产139,737 92,183 
总资产$4,303,416 $4,261,792 
550,714
当前负债：
应付账款$327,038 $385,330 
应付负债820,165 788,040 
流动部分递延收入93,405 102,157 
流动负债合计1,240,608 1,275,527 
非流动营收项目23,267 24,572 
非流动租赁负债535,378 586,174 
其他长期负债43,653 49,186 
总负债1,842,906 1,935,459 
承诺及不确定事项（附注12）
股东权益：
0.010.0001 每股面值 $
15 14 
资本公积额额外增资3,851,967 3,623,747 
其他综合损益（损失）累积额(47)159 
累积亏损(1,391,425)(1,297,587)
股东权益总额2,460,510 2,326,333 
负债总额和股东权益总额$4,303,416 $4,261,792 
请参阅附注的基本财务报表。
1
目录
ROKU，股份有限公司。
经简化的合并利润及损失表
（以千元为单位，除每股数据外）
（未经审计）
 三个月已结束 九个月已结束
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
净收入：
平台$908,175 $786,785 $2,487,443 $2,165,238 
设备154,028 125,233 424,408 334,956 
净收入总额1,062,203 912,018 2,911,851 2,500,194 
收入成本：
平台416,396 408,554 1,161,416 1,057,151 
设备165,732 134,641 457,369 358,352 
总收入成本582,128 543,195 1,618,785 1,415,503 
毛利（亏损）：
平台491,779 378,231 1,326,027 1,108,087 
设备(11,704)(9,408)(32,961)(23,396)
毛利总额480,075 368,823 1,293,066 1,084,691 
运营费用：
研究和开发178,798 282,201 534,738 694,673 
销售和营销237,047 307,694 660,827 768,805 
一般和行政99,993 128,717 276,543 309,422 
运营费用总额515,838 718,612 1,472,108 1,772,900 
运营损失(35,763)(349,789)(179,042)(688,209)
其他收入，净额30,880 22,902 84,955 65,317 
所得税前亏损(4,883)(326,887)(94,087)(622,892)
所得税支出（福利）4,147 3,184 (249)8,378 
净亏损$(9,030)$(330,071)$(93,838)$(631,270)
每股净亏损——基本亏损和摊薄后$(0.06)$(2.33)$(0.65)$(4.47)
已发行普通股的加权平均值——基本股和摊薄后普通股144,862141,877144,319 141,087 
请参阅附注的基本财务报表。
2
目录
ROKU, INC.
基本报表综合损益表
（以千为单位）
(未经审计)
三个月已结束九个月已结束
2024年9月30日2023年9月30日2024年9月30日2023年9月30日
净亏损$(9,030)$(330,071)$(93,838)$(631,270)
扣除税款的其他综合收益（亏损）：
外币折算调整614 (237)(206)126 
综合损失$(8,416)$(330,308)$(94,044)$(631,144)
请参阅附注的基本财务报表。
3
目录
ROKU，股份有限公司。
股东权益的简明合并报表
（以千为单位）
(未经审计)
 普通股
共计
实收资本
累计
其他全面
收益（损失）		累计
赤字		总
股东的
股东权益
2024年9月30日止三个月股份数量
2024年6月30日结余144,689 $14 $3,773,831 $(661)$(1,382,395)$2,390,789 
根据股权激励计划发行的普通股股份852 1 301 — — 302 
股票补偿费用— — 100,096 — — 100,096 
股票以用于补缴与净股份结算相关的税款(342)— (22,261)— — (22,261)
外币翻译调整— — — 614 — 614 
净亏损— — — — (9,030)(9,030)
截至2024年9月30日的余额145,199 $15 $3,851,967 $(47)$(1,391,425)$2,460,510 
2024年9月30日止九个月
截至2023年12月31日的余额143,502 $14 $3,623,747 $159 $(1,297,587)$2,326,333 
根据股权激励计划发行的普通股股份2,724 1 8,980 — — 8,981 
股票补偿费用— — 283,124 — — 283,124 
股票用于支付与权益奖励相关的税款(1,027)— (63,884)— — (63,884)
外币翻译调整— — — (206)— (206)
净亏损— — — — (93,838)(93,838)
余额-2024年9月30日145,199 $15 $3,851,967 $(47)$(1,391,425)$2,460,510 
 普通股
共计
实收资本
累计
其他全面
收益（损失）		累计
$		总
股东的
股权
2023年9月30日止三个月股份数量
余额—2023年6月30日141,508 $14 $3,422,415 $71 $(889,225)$2,533,275 
根据股权激励计划发行的普通股股份988 — 13,195 — — 13,195 
股票补偿费用— — 91,305 — — 91,305 
外币翻译调整— — — (237)— (237)
净亏损— — — — (330,071)(330,071)
2023年9月30日余额142,496 $14 $3,526,915 $(166)$(1,219,296)$2,307,467 
2023年9月30日止九个月
余额-2022年12月31日140,027 $14 $3,234,860 $(292)$(588,026)$2,646,556 
根据股权激励计划发行的普通股股份2,469 — 14,699 — — 14,699 
股票补偿费用— — 277,356 — — 277,356 
外币翻译调整— — — 126 — 126 
净亏损— — — — (631,270)(631,270)
2023年9月30日余额142,496 $14 $3,526,915 $(166)$(1,219,296)$2,307,467 
请参阅附注的基本财务报表。
4
目录
ROKU，股份有限公司。
简明合并现金流量表
（以千为单位）
(未经审计)
 九个月结束
 2024年9月30日2023年9月30日
经营活动现金流量：
净亏损$(93,838)$(631,270)
调整为了将净亏损调节为经营活动现金流：
折旧和摊销47,629 53,047 
股票补偿费用283,124 277,356 
摊销租赁权资产35,674 45,137 
内容资产摊销和冲销158,892 154,801 
外币重估损失674 3,469 
可转换应收票据中战略投资公平价值变动(6,978)(3,734)
资产减值29,118 235,165 
应收账款减值准备2,081 1,977 
其他项目，净额(2,224)(872)
经营性资产和负债变动:
应收账款83,828 38,416 
存货(99,084)1,373 
预付费用和其他流动资产(40,952)16,003 
资产及负债，净额(141,345)(191,481)
其他非流动资产(19,996)5,448 
应付账款(57,937)174,784 
应计负债14,044 70,217 
经营租赁负债(45,766)(14,301)
其他长期负债1,866 (910)
递延收入(10,057)4,904 
经营活动产生的现金流量净额138,753 239,529 
投资活动现金流量：
购买固定资产(2,603)(79,099)
2,982 (20,000)(10,000)
投资活动产生的净现金流出(22,603)(89,099)
筹集资金的现金流量：
偿还借款— (80,000)
与信用协议相关的发行成本(1,829)— 
根据激励计划发行的股权收入8,981 14,699 
与股份奖励净结算相关的支付的税额(63,884)— 
筹集资金净额(56,732)(65,301)
现金，现金等价物和受限制现金的净增加额59,418 85,129 
汇率变动对现金、现金等价物及受限制资金的影响2,774 (2,964)
现金、现金等价物和受限制现金—期初2,066,604 1,961,956 
现金、现金等价物和受限现金——期末$2,128,796 $2,044,121 
5
目录

九个月结束
2024年9月30日2023年9月30日
期末现金、现金等价物和受限现金：
现金及现金等价物$2,126,974 $2,003,408 
限制性现金，流动资产1,822 40,713 
现金、现金等价物和受限现金——期末$2,128,796 $2,044,121 
补充现金流信息披露：
支付的利息现金$106 $886 
支付的所得税费用$13,235 $5,027 
非现金投资和筹资活动的补充披露:
财产和设备购买的未付余额$169 $1,129 
请参阅简明合并基本报表注解。
6
目录
ROKU，股份有限公司。
压缩合并财务报表注释
1. 本公司
业务的组织和描述
Roku公司（以下简称“公司”或“Roku”）成立于2002年10月，为特拉华州法律下的Roku有限责任公司。2008年2月1日，Roku有限责任公司更名为Roku, Inc.，成为特拉华州的一家公司。该公司的经营范围为 两个 可报告的业务部门，并通过销售数字广告（包括直接和程序化视频广告、媒体和娱乐促销支出以及相关服务）、流媒体服务分发（包括订阅和交易收入份额、高级订阅销售以及遥控器上品牌应用按钮的销售）产生平台收入。该公司通过销售流媒体播放器、Roku品牌电视、智能家居产品和服务、音频产品以及相关配件，以及与服务运营商的许可安排产生设备收入。
2. 重要会计政策摘要。
报告前提
简明综合财务报表已按照美国通常公认会计原则(“U.S. GAAP”)和证券交易委员会(“SEC”)有关中期财务报告的适用规则和法规编制。根据该规则和法规，通常包括于符合U.S.GAAP的财务报表中的特定信息和附注披露已被简化或省略。这些简明综合财务报表应当与公司于2023年12月31日止年度在2024年2月16日向SEC提交的年度报告10-K中的综合财务报表一起阅读(“年度报告”)。
截至2023年12月31日的合并资产负债表是根据该日期经审计的合并基本报表得出的，但不包含公司年度报告中包含的所有信息和附注。中期财务信息未经审计，但反映了管理层认为必要的所有正常经常性调整，以公正地呈现此处所列信息。截至2024年9月30日的三个月和九个月的经营结果不一定能指示全年或任何未来期间的运营结果。
在我们的简明合并基本报表及相关附注中，某些报告的前期金额已被重新分类，以符合当前期间的展示。
使用估计
根据美国通用会计准则，公司编制的简明合并基本报表要求管理层做出一些估计、判断和假设，这些估计、判断和假设影响报告的资产、负债、营业收入和费用的金额。受此类估计和假设影响的重要项目包括：
•收入确认：确定履行义务的性质和满足时机，变动对价，确定履行义务的单独售价，毛收入与净收入的确认，以及评估客户与供应商关系；
•无形资产的减值；
•资产的摊销和内容资产的减值；
•经营租赁使用权资产和物业及设备的减值；
•战略投资的估值（见注释7）；
•有形和无形资产的有用寿命;
•销售退货和销售激励的津贴；和
•递延所得税资产的估值。
公司基于历史经验和公司认为在当前情况下合理的各种其他假设来进行估计。实际结果可能与公司的估计和假设有所不同。
7
目录
合并原则——未经审计的中期简明合并财务报表包括按照GAAP准备的公司及其全资子公司的账户。所有公司间余额和交易均已经过整合。所有金额都是以百万为单位，除了股份和每股股价。
包含了Roku, Inc.及其全资子公司的合并基本报表，已按照美国公认会计原则编制。所有的公司间账目和交易在合并中已被消除。
现金及现金等价物和受限制现金
公司认为，所有在购买日具有原始到期日不超过三个月的高流动性投资可视为现金等价物。现金及现金等价物主要包括银行存款账户和货币市场基金投资。
截至2024年9月30日，公司的受限现金余额为$1.8 百万，并计入合并资产负债表中的预付费用和其他流动资产。它用于担保与办公设施的经营租赁相关的特定未偿付信用证。
公司将其现金、现金等价物和受限制现金存款保持在信用质量高的金融机构，并持续监控对任何一家金融机构的风险敞口金额，并根据需要进行多元化，以减少其集中风险。这些余额通常超过监管规定的保险限额。
应收账款净额
应收账款通常是无担保的，来源于从客户那里赚取的营业收入。它们按发票价值减去预计的销售退货、销售激励、可疑账款和其他杂项准备金而记载。公司对其客户进行持续的信用评估，以判断潜在的信用损失和可疑账款的准备金。公司考虑历史经验、持续的促销活动、历史索赔率和其他因素来判断销售退货和销售激励的准备金。
销售退货准备金: 销售退货的准备金包括以下活动（以千为单位）：
 三个月结束 截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
开始余额$6,376 $7,392 $7,808 $7,417 
添加：计入营业收入3,733 3,881 12,307 12,045 
减：销售退货准备金的利用(4,039)(4,058)(14,045)(12,247)
结束余额$6,070 $7,215 $6,070 $7,215 
销售激励津贴: 销售激励津贴包括以下活动（以千计）：
 三个月结束  截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
开始余额$26,641 $17,428 $23,024 $28,903 
加：计入营业收入37,622 16,048 93,655 43,598 
减少：销售激励准备金利用(36,292)(19,426)(88,708)(58,451)
结束余额$27,971 $14,050 $27,971 $14,050 
应收账款坏帐准备: 坏账准备金包括以下活动（以千为单位）：
三个月结束  截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
开始余额$5,869 $5,578 $2,213 $3,498 
坏账准备（回收的坏账）(2,263)(984)2,081 1,977 
冲销的调整(323)(2,046)(1,011)(2,927)
结束余额$3,283 $2,548 $3,283 $2,548 
客户J占据了 11截至2024年9月30日，公司应收账款的净余额的百分比。公司没有任何客户在截至2023年12月31日的应收账款净余额中占据超过10%。
8
目录
最近的会计声明
2023年11月，财务会计准则委员会（“FASB”）发布了会计准则更新（“ASU”）2023-07，“分段报告”（主题280）：报告段披露的改进，要求公司在年度和中期基础上提供有关报告段披露的重要细分费用的增强披露。该指南适用于2023年12月15日之后开始的财年和财年内开始于2024年12月15日之后的中期。该指南对财务报表中呈现的所有先前期间进行追溯调整。公司当前正在评估新指南的影响。 分段披露（主题280）-报告分段披露改进这要求公司在其可报告板块的报告中提供有关重大板块费用的增强披露。该指导原则适用于2023年12月15日之后开始的财政年度及2024年12月15日之后开始的财政年度的间隔期。该指导原则追溯适用于财务报表中呈现的所有前期。公司目前正在评估新指导原则的影响。
2023年12月，FASB发布了ASU 2023-09，所得税（话题 740）- 改进所得税披露这需要在所得税披露中逐步增加披露内容，提高所得税披露的透明度和实用性。更新后的披露主要要求在税率调和中提供特定类别和更大的细分，分解已支付的所得税，以及对其他与所得税相关的披露进行修改。该指引自2024年12月15日后开始的财年起，适用于前瞻性或追溯性。公司目前正在评估新指引的影响。
3. 收入
公司的分解营业收入由第15条讨论的可报告部门代表。 二 报告的分部在注释15中讨论。
合同余额包括以下内容（单位：千元）：
 截至
 2024年9月30日2023年12月31日
应收账款，净额$729,911 $816,337 
合同资产（计入预付费用和其他流动资产）7,372 17,964 
递延收入，当期部分$93,405 $102,157 
递延收入，非流动部分23,267 24,572 
递延收入总额$116,672 $126,729 
应收账款按发票金额记录，扣除销售退货、销售激励和可疑账款的拨备。付款条款可以根据客户和合同有所不同。
营业收入的确认时机可能与向客户开票的时机不同。当开票发生在营业收入确认之后时，合同资产就会产生。当开票权利变为无条件时，合同资产转移至应收账款。公司的合同资产本质上是流动的，包含在预付费用和其他流动资产中。合同资产减少了$10.6 在截至2024年9月30日的九个月中，由于向客户开票的时机，减少了百万。
总递延营业收入反映在履行义务和确认营业收入完成之前开具的发票金额。总递延营业收入减少了$10.1 在截至2024年9月30日的九个月期间，减少了百万，主要是由于履行义务的时间安排，而受到来自更高的高级订阅的递延营业收入增加的抵消。
截至2024年9月30日的三个月和九个月期间确认的营业收入，来自截至2023年12月31日的总递延收入中的金额为$10.5 百万美元和美元92.8 百万，分别为。截止2023年9月30日的三个月和九个月期间确认的营业收入，来自截至2022年12月31日的总递延收入中的金额为$10.8 百万美元和美元77.7 百万，分别为。
分配给剩余履约义务的营业收入代表尚未确认的估计合同收入，包括未赚取的收入和将来期间将开具发票并确认为收入的金额。截至2024年9月30日，这些剩余履约义务的估计合同收入为$940.1 百万，其中公司预计将识别约 57%将在未来的12以下表格总结了以公平价值为基础在公平价值层次结构内定期计量的资产类型（以千美元为单位）:
本公司于2023年12月31日和2022年12月31日的三个月内确认的股权奖励支出为12.0 百万美元和美元15.8 截至2024年9月30日的三个月和九个月，营业收入分别为百万美元，并认定$15.8 百万美元和美元41.8 从合同中认可的在以前期间已履行的绩效义务中，分别于截至2023年9月30日的三个月和九个月内，由于估计交易价格的变化而认定为百万美元。
客户J占了公司截至2024年9月30日三个月的净营业收入 11百分之%。. 截至2024年9月30日九个月结束时，公司没有任何客户占公司总净营业收入的10%以上。 客户I分别占了公司截至2023年9月30日三个和九个月的净营业收入的百分之%。 11%和 11% 。
9
目录
4. 商誉和无形资产
善意
商誉代表在企业合并中，购买对价超过所获取的有形和无形资产的公允价值减去承担的负债的部分。所有商誉与公司的平台业务板块有关。
无形资产
以下表格总结了公司的无形资产在呈现的期间 (千元单位，除年份外)：
截至2024年9月30日
总账面价值累计摊销净账面价值加权平均有用寿命
(以年计)
开发的科技$73,367 $(57,944)$15,423 5.9
客户关系14,100 (14,100)$— 4.0
商标名称20,400 (7,466)12,934 9.8
专利4,076 (1,407)2,669 14.0
无形资产总额$111,943 $(80,917)$31,026 6.7
截至2023年12月31日
毛额
账面价值
金额		累计
摊销		净值
账面价值
金额		加权平均有用寿命
(以年计)
开发的科技$73,367 $(49,087)$24,280 5.9
客户关系14,100 (13,948)152 4.0
商标名称20,400 (5,966)14,434 9.8
专利4,076 (1,189)2,887 14.0
无形资产总额$111,943 $(70,190)$41,753 6.7
公司在截至2024年6月30日和2023年6月30日的三个月内分别录得了无形资产的摊销费用$百万。3.5 百万美元和美元4.4 在截至2024年和2023年9月30日的三个月内，无形资产的金额分别为$百万和$百万。 公司记录了$百万的摊销费用。10.7 百万美元和美元13.2 在截至2024年和2023年9月30日的九个月内，无形资产的金额分别为$百万和$百万。
公司在截至2023年9月30日和2024年9月30日的三个月以及截至2024年9月30日的九个月中，将开发技术的摊销记录在营业成本、平台上。在截至2023年9月30日的九个月中，开发技术的摊销记录在营业成本、平台和研发费用。公司在所有报告期间的综合损益表中，将客户关系和商标的摊销记录在销售和营销费用中，专利的摊销记录在一般和管理费用中。
截至2024年9月30日，未来五年和以后无形资产的预计摊销费用如下（以千为单位）：
截止日期为12月31日的年份 
2024年（剩余3个月）$3,525 
202512,533 
20264,074 
20272,737 
20282,291 
然后5,866 
总计$31,026 
10
目录
5. 资产负债表元件
应收账款净额: 应收账款净额包括以下内容（以千为单位）：
 截至
 2024年9月30日2023年12月31日
应收账款，毛额$768,054 $850,464 
减少：津贴
销售退货准备金6,070 7,808 
销售激励津贴27,971 23,024 
坏账准备3,283 2,213 
其他拨备819 1,082 
总拨备38,143 34,127 
应收账款，净额$729,911 $816,337 
物业和设备，净值: 固定资产净额包括以下内容（以千计）：
 截至
 2024年9月30日2023年12月31日
电脑和设备$50,574 $51,320 
租赁改良286,481 292,418 
内部使用软件5,916 6,980 
办公设备和家具35,900 36,900 
234,036378,871 387,618 
减：累计折旧及摊销(155,872)(123,062)
物业和设备，净值$222,999 $264,556 
2024年9月30日结束的三个月中，房地产和设备资产的折旧和摊销费用分别为XX百万美元和2023年为XX百万美元。11.8 百万美元和美元14.5 2024年9月30日结束的九个月中，房地产和设备资产的折旧和摊销费用分别为XX百万美元和2023年为XX百万美元。36.9 百万美元和美元39.8百万美元。
截至2024年9月30日的三个月和九个月期间，公司确认了与重组工作相关的租赁办公室设施的物业和设备的减值损失$6.5 百万美元和美元7.0 百万。截止至2023年9月30日的三个月和九个月期间，公司记录了与重组工作相关的租赁办公室设施的物业和设备的减值损失$68.1 百万美元和美元68.7 百万。有关更多详细信息，请参见对合并基本报表的第16条注释。
应计负债: 应计负债包括以下（以千元为单位）：
截至
2024年9月30日2023年12月31日
应付内容合作伙伴的款项$247,371 $239,196 
营业成本应计款项152,966 147,875 
营销、零售和商品费用65,750 147,853 
经营租赁负债，流动负债77,815 68,099 
内容负债，流动62,509 54,319 
其他应计费用213,754 130,698 
总计应计负债$820,165 $788,040 
11
目录
递延收入: 递延营业收入包括以下项目（单位：千元）：
 截至
 2024年9月30日2023年12月31日
平台，当前$63,438 $66,636 
设备，当前29,967 35,521 
当前递延营业收入总额93,405 102,157 
平台，非流动资产73 625 
设备，非流动资产23,194 23,947 
非流动递延收入总额23,267 24,572 
递延收入总额$116,672 $126,729 
其他长期负债: 其他开多期负债包括以下内容（以千为单位）：
截至
2024年9月30日2023年12月31日
内容责任，非流动性$20,405 $24,115 
其他长期负债23,248 25,071 
总其他长期负债$43,653 $49,186 
6. 内容 资产
资产内容净额包括以下内容（以千为单位）：
 截至
 2024年9月30日2023年12月31日
已授权内容、资产和预付款$159,928 $148,777 
制作内容:
发布后不再分期摊销63,193 77,951
已完成，未发布29,781 11,235
正在制作中10,269 38,275
总生产内容，净额103,243 127,461
总内容资产，净额和预付款$263,171 $276,238 
流动部分（包括预付费用和其他流动资产）$15,792 $18,843 
非当前部分$247,379 $257,395 
内容资产的摊销包含在营业收入成本中，平台在简明合并经营报表中的表现如下（以千为单位）：
 截至三个月截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
授权内容$40,744 $37,454 $114,979 $124,690 
产生的内容10,126 15,033 32,106 30,111 
总摊销成本$50,870 $52,487 $147,085 $154,801 
截至2024年6月30日的三个月内，公司注销了$11.8 百万美元的未摊销成本，这些成本与已从Roku频道内容库中移除的制作内容资产有关。这项注销不是公司重组工作的部分。在截至2024年3月31日和2024年9月30日的三个月内没有任何注销。
截至2023年9月30日止三个月和九个月，公司记录了$ 的减值费用。61.6 百乐公司为加强重组而从Roku频道中删除部分许可和制作内容，产生了相关百万美元的减值费用。有关公司的简明合并基本报表详情，请参阅附注16。
12
目录
重组努力。
7. 战略投资
可转换本票的投资
2022年6月，公司同意向一家与公司具有商业关系的交易对手提供高达$的融资。60.0 百万美元。这些预付款以可转换的可赊债券形式确认为资产负债表上的其他非流动资产。可转换的可赊债券以每年%的利率计息，并根据下表反映的到期日或在赎回事件或违约事件发生时到期。 5年，而到期日如下表所示，或在赎回事件发生时或违约事件发生时到期。
可转换的期票及其投资日期和到期日期如下（以千计）：
截至2024年9月30日
投资日期投资金额到期日期
2022年7月1日$40,0002025年6月15日
2023年3月23日$5,0002026年3月23日
2023年5月23日$5,0002026年5月23日
可转换可赎回票据具有特定赎回特征，符合嵌入式衍生工具的定义并需要进行分拆。公司选择了应用公允价值选择并按公允价值核算混合工具，其中包括主合同和嵌入式衍生工具的公允价值，将公允价值的任何后续变动计入其他收入净额，合并利润表中。有关可转换可赎回票据的公允价值的更多详细信息，请参阅基本报表的附注8。
优先股投资
2024年9月，公司投资了$20.0 百万现金，用于交换私人持有公司的优先股。公司选择了将毫无明确公允价值的权益证券的计量替代方案，因为对于优先股来说没有报价市场价格。该投资按成本计量，并在有观察到的订单交易中出现价格变动时调整为公允价值，并在事件或情况表明账面价值可能无法收回时进行减值评估。截至2024年9月30日，公司投资的账面价值为$20.0 百万美元，在简明合并资产负债表中列为其他非流动资产中。
8. 公平价值披露
公司按公允价值计量的金融资产如下（以千万计）：
截至2024年9月30日
公允价值一级三级
资产:
现金及现金等价物：
现金$720,059 $720,059 $— 
货币市场基金1,406,915 1,406,915 — 
受限现金，流动资产1,822 1,822 — 
其他非流动资产：
战略投资 - 可转换债券60,794 — 60,794 
资产的总额按公允价值进行测量和记录$2,189,590 $2,128,796 $60,794 
13
目录
截至2023年12月31日
公允价值一级三级
资产:
现金及现金等价物：
现金$594,493 $594,493 $— 
货币市场基金1,431,398 1,431,398 — 
受限现金，流动资产40,713 40,713 — 
其他非流动资产：
战略投资 - 可转换票据53,816 — 53,816 
资产的总额按公允价值进行测量和记录$2,120,420 $2,066,604 $53,816 
以下表反映了公司三级财务资产（以千元计）公允价值的变化。
截至三个月截至九个月
2024年9月30日2023年9月30日2024年9月30日2023年9月30日
开始余额$57,450 $52,558 $53,816 $39,468 
战略投资 - 可转换票据— — — 10,000 
战略投资的公允价值变动 - 可转换票据3,344 644 6,978 3,734 
结束余额$60,794 $53,202 $60,794 $53,202 
公允价值被定义为在主要市场（或在没有主要市场的情况下最有利的市场）中，按照测量日期的市场参与者之间的有序交易，出售资产时所收到的价格或转让负债时所支付的价格。此外，公司最大限度地利用可观察输入，并最小化不可观察输入在公允价值测量中的使用，并利用三层公允价值层级来优先处理用于测量公允价值的输入。
用于衡量公允价值的三个输入层级如下：
一级在活跃市场上报价的相同资产或负债。
使用一级输入衡量的金融资产和负债包括现金、现金等价物、受限现金、应收账款、预付费用、应付账款和应计负债。
公司认为所有在购买之日具有原始期限不超过三个月的高流动性投资均视为现金等价物。该公司将货币市场基金的$1,406.9 百万美元和美元1,431.4 百万分别视为现金等价物，截至2024年9月30日和2023年12月31日，使用一级输入进行计量。
二级—在第1级中，除了报价价格的可观察输入外，还包括活跃市场中类似资产或负债的报价价格；在非活跃市场中相同或类似资产或负债的报价价格；以及其他可观察的输入，这些输入是通过相关性或其他方式从可观察市场数据中主要推导或证实的。
截至2024年9月30日和2023年12月31日，公司没有二级工具。
三级—无法观察的输入，由于市场活动很少或没有，显著影响资产或负债的公允价值，并反映了公司对市场参与者在定价资产或负债时使用假设的自身假设，这些假设是根据当时最佳可用的信息制定的。
截至2024年9月30日，公司使用第3级输入衡量其在可转换债券的战略投资。可转换债券战略投资在购买日期的公允价值被确定为等于其本金金额。公司记录了未实现收益为$3.3 百万美元和美元0.6 百万，在其他收入中，净额与2024年9月30日和2023年9月30日结束的三个月期间可转换债券战略投资公允价值调整有关。公司记录了未实现收益为$7.0 百万美元和美元3.7 百万，在其他收入中，净额与2024年9月30日和2023年9月30日结束的九个月期间可转换债券战略投资公允价值调整有关。
由于缺乏相关的可观察市场数据用于公允价值输入，公司将可转换短期票据的战略投资分类为第3等级。可转换短期票据的战略投资的公允价值是使用基于情景的概率加权贴现现金流模型估算的。重要的
14
目录
假设包括折现率，以及影响可转让期票策略性投资结算的各种赎回情景的时间和概率加权。
按非经常性基础公允价值计量的资产和负债
非财务资产如商誉、无形资产、房地产与设备、经营租赁使用权资产及内容资产在确认减值时进行减值评估，并采用第三级输入调整至公允价值。
在截至2024年9月30日的三个月中，公司记录的减值费用为美元11.4百万美元与经营租赁使用权资产有关，以及 $6.5 百万美元与财产和设备有关，均与作为其重组工作一部分的租赁办公设施有关。在截至2023年9月30日的三个月中，公司记录的减值费用为美元101.1百万美元与经营租赁使用权资产有关，以及 $68.1百万美元与财产和设备有关，均与作为其重组工作一部分的租赁办公设施有关，以及美元61.6数百万的内容资产减值，这是其重组工作的一部分。
截至2024年9月30日的九个月期间，公司记录了与经营租赁使用权资产相关的减值费用$22.6百万，以及与物业和设备相关的减值费用$7.0百万，这两个费用均与其重组工作的一部分租赁办公设施相关。在截至2023年9月30日的九个月期间，公司记录了与经营租赁使用权资产相关的减值费用$104.9百万，以及与物业和设备相关的减值费用$68.7百万，这两个费用均与其重组工作的一部分租赁办公设施相关，并且还有$61.6百万的内容资产减值，这也是其重组工作的一部分。有关详细信息，请参见基本报表第16条。
9. 租赁
公司的经营租赁主要用于办公设施。 租约剩余期限不等，从少于 一份1年内的租赁费用为年 您好，很高兴为您提供帮助。且可能包括延长或终止租约的选择。 经营租赁权益资产的折旧年限受预期租赁期限的限制。 公司已就部分可用办公空间签订了转租协议。 转租也被分类为经营租赁。
租赁费用的元件如下（单位：千）:
 截至三个月截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
营业租赁费用
$16,046 $21,097 $52,426 $64,243 
变量租赁费用5,765 5,623 16,518 17,995 
转租收入(4,871)— (7,756)— 
总经营租赁支出$16,940 $26,720 $61,188 $82,238 
与租赁有关的补充现金流量信息如下（以千为单位）：
 截至三个月截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
支付与租赁负债计量相关的现金：
经营租赁的经营现金流出$24,192 $19,097 $67,914 $54,417 
用于获得租赁义务的权利资产:
经营租赁$5,616 $28,795 $8,501 $40,704 
由于减值导致经营租赁使用权资产下降（详情见附注16）$11,386 $101,077 $22,618 $104,867 
15
目录
与租赁相关的附表信息如下（单位：千元，租赁期限和折现率除外）：
 截至
 2024年9月30日2023年12月31日
经营租赁使用权资产$314,326 $371,444
经营租赁负债，流动资产中（包含在应计负债中）$77,815 $68,099
非流动经营租赁负债535,378 586,174
总经营租赁负债$613,193 $654,273
经营租赁剩余平均期限（年）7.27.9
营业租赁的加权平均折现率3.96 %3.94 %
截至2024年9月30日，运营租赁下的未来租赁付款（不包括来自分租安排的任何分租收入）如下（单位：千元）：
截止日期为12月31日的年份经营租赁
2024年（剩余3个月）$24,447 
2025101,538 
2026102,067 
2027100,352 
2028100,380 
然后283,199 
总租赁未来支付款项711,983 
减去：隐含利息(95,531)
减少：预期的承租人装修津贴(3,259)
总计 (1)
$613,193 
(1) 总租赁负债包括与运营租赁权利使用资产有关的负债，这些负债包含在公司重组工作中作为基本报表附注16的一部分而纳入的减值损失中。
截至2024年9月30日，公司账上大约有未确认税收优惠金额。1与尚未开始的经营租赁相关的承诺金额千百万。
截至2024年9月30日，公司预计将从其转租安排中收到约$86.3 百万，这些转租安排的加权平均剩余租期约为 5.5 年的时间内确认为费用。
10. 债务
公司于2024年9月16日签署了一份信贷协议，该协议由公司作为借款人、我们的某些子公司作为担保人、出借人和参与方银行，以及花旗银行有限责任公司作为行政代理人（“信贷协议”）。该协议规定了（i）最高达$百万的循环信贷额度和（ii）最高达额外$百万的不承诺增加选择权，可在满足某些惯例条件时行使。信贷协议规定了一个$百万的支票保函发行分项额度，并且某些现有的信用证被视为在该额度下未偿还。信贷协议将于2029年9月16日到期。信贷协议的款项可用于一般企业用途，包括资助营运资金需求。 五年 百万美元的循环信贷额度300.0 百万美元的不承诺增加选择权300.0 百万美元100.0 百万美元的支票保函发行分项额度
公司的信用协议项下的义务由公司的所有资产以及作为担保人的子公司资产提供担保。公司可以提前偿还贷款，在某些情况下也被要求提前偿还信用协议下的贷款，且无需支付溢价。信用协议还包含惯例性声明和保证，惯例性正面和负面契约，要求维持最低利息覆盖率和最高总净杠杆比率的财务契约，以及惯例性的违约事件，违约事件的发生可能导致借款金额的增加。
16
目录
信贷协议在计划的2029年9月16日到期之前到期并终止，剩余承诺终止。
与公司信贷协议相关的债务发行成本记入预付费用和其他流动资产以及其他非流动资产，按期分期摊销 五年 并作为利息费用的组成部分计入压缩的合并经营报表中。
截至2024年9月30日，公司根据信贷协议拥有未偿还的信用证，金额为$ 百万。36.4截至2024年9月30日，公司没有根据信贷协议借款，并且公司遵守了信贷协议的所有条款。

11. 股东权益
优先股
公司在加利福尼亚州为其办公空间租赁了一个子租约，该租约于2023年11月开始，最初租约期至2026年1月。该租约替代了同一地址于2022年1月开始的租约，最初租约期至2024年1月（于2024年1月结束）。此外，该公司还租用其他租期少于十二个月的空间；因此，在资产负债表上不承认此租约为营运租约。10 公司董事会在这些股票发行时确定了未指定优先股的权益和偏好，共授权但未发行的股份为百万股。截至2024年9月30日和2023年12月31日，共有 没有 优先股已发行和流通。
普通股
公司在加利福尼亚州为其办公空间租赁了一个子租约，该租约于2023年11月开始，最初租约期至2026年1月。该租约替代了同一地址于2022年1月开始的租约，最初租约期至2024年1月（于2024年1月结束）。此外，该公司还租用其他租期少于十二个月的空间；因此，在资产负债表上不承认此租约为营运租约。二 授权普通股、A类普通股和B类普通股。持有A类普通股的股东有权 一份 每份持有的B类普通股投票。提交给股东投票的议题，持有B类普通股的股东有权 十 每份B类普通股享有两票投票权。除了投票权外，A类和B类普通股股东的权利相同。B类普通股可以由持有人自愿转换为A类普通股，并在出售或转让时通常自动转换为公司的A类普通股。与股票期权行使、限制性股票单位归属或员工股票购买计划购买的股份有关的，通常会自动转换为公司的A类普通股。
在2024年3月31日结束的三个月和2023年3月31日结束的三个月中，保留供将来发行的普通股的发行量如下:
截至2024年9月30日，公司未来发行的普通股如下（以千为单位）：
截至
 2024年9月30日
根据股权激励计划授予的普通股奖励15,915 
根据2017年员工股票购买计划可发行的普通股奖励 (1)
5,089 
根据2017年股权激励计划可发行的普通股奖励31,427 
普通股的总预留股份52,431 
(1) 公司尚未根据2017年员工股票购买计划发行任何普通股。
其他板块
该公司当前根据修订后的2017股权激励计划（“2017计划”）授予股权。2017计划自2017年9月起生效，与公司的首次公开募股（“IPO”）相关。2017计划规定向公司的员工授予激励性股票期权以及向公司的员工、董事和顾问授予非法定股票期权、股票增值权、限制性股票奖、限制性股票单位奖、业绩股票奖、业绩现金奖以及其他形式的股权薪酬。
公司的未分配股本与2017计划和2008年股权激励计划（“2008计划”）有关，这是一个IPO前的计划。自首次公开募股（IPO）以来，没有根据2008计划进行额外的股权授予。
2017年计划授予的股权受连续服务的限制。2017年计划授予的期权通常以授予日的股票价格为基准。持有公司合并投票权超过一定比例的期权受限制，授予给这类受限制持有者的激励股票期权的价格不得低于授予日的公允市场价的 10% 公司所拥有的综合投票权的持有人受特定限制，授予这类持有人的激励股票期权的价格不得低于公允市场价的 110% 公允市场价的价格。
限制性股票单位
2024年9月30日截至九个月的限制性股票单位活动如下（按千计，除每股数据外）：
17
目录
 
数量
股份
 
加权平均
授予日期公允价值
每股价值
2023年12月31日期初余额
8,674 $97.33 
授予4,316 59.20 
释放(2,392)111.53 
被取消(581)96.89 
2024年9月30日的余额
10,017 $77.53 
截至2024年9月30日，公司负债$639.7 百万未确认的与未归属限制性股票单位相关的股票补偿费用，预计将在大约加权平均期内确认。 2.1年。
股票期权
截至2024年9月30日的九个月内股票期权活动如下（以千为单位，除年份和每股数据外）：
 
数量
股份
加权-
平均
行使
价格
加权-
平均
剩余
加权
寿命（年）
总计
截至2023年7月29日的余额
价值
2023年12月31日期初余额
5,310 $75.55 6.8
已授予948 59.17 — 
已行权(332)27.06 — 
已放弃和过期(28)141.30 — 
2024年9月30日的余额
5,898 $75.33 6.8$109,020 
 
截至2024年9月30日可以行使的期权
3,801 $71.59 5.8$82,033 
截至2024年9月30日，公司负债$69.8 百万美元的未识别股权奖励费用与预计将在大约加权平均期内确认的未授予期权相关。 2.1年。
按股票补偿计算的费用
公司根据授予日期权益的公允价值来衡量员工服务的成本。授予给员工的期权通常是按比例归属的， 一份 to 四年 并且有效期为 十年。受限股票单位通常按比例归属 一份 to 四年.
下表显示截至2024年和2023年9月30日的三个月和九个月的总股票薪酬费用（以千计）：
 截至三个月截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
营业成本，平台$366 $368 $1,062 $1,056 
营业成本，设备163 810 1,201 2,426 
研发38,502 37,314 109,457 110,801 
销售和营销36,401 34,421 100,353 99,785 
一般和行政24,664 18,392 71,051 63,288 
股权报酬总额$100,096 $91,305 $283,124 $277,356 
18
目录
12. 请见上文。
制造业采购承诺
公司在业务正常开展过程中与供应商签订了各种制造业-半导体合同。为了管理未来产品需求，公司与制造商和供应商达成协议，根据特定标准和时间采购库存。其中一些承诺是不可取消的。截至2024年9月30日，公司对库存的不可取消采购承诺金额为$238.2 百万美元。截至2024年9月30日，公司已经为预期的库存采购承诺损失拨备了$10.4百万美元。这一计提记录在简明合并资产负债表中的应计负债中，相关费用记录在简明合并损益表中的营业成本支出中。
内容承诺
公司与内容合作伙伴签订合同，以许可和制作流媒体内容。当某个标题可用时，公司在合并的资产负债表上记录内容资产和负债。某些协议包括对未来未知标题的许可权的义务，但截至报告日期，最终的数量和/或费用尚无法确定。公司不会包括除已知的最低金额之外的未来标题的任何估计义务。这些未知的义务可能是重大的。公司还根据内容授权安排进行许可，其中的付款是变量，并基于公司获得的营业收入。由于这些金额无法确定，因此未包含在以下的义务中。
截至2024年9月30日，公司对许可及制作内容的总义务为$268.1 百万，其中公司在压缩合并资产负债表中记录了$65.9 百万的流动负债和$20.4 百万的其他开多期负债。其余$181.8 百万尚未在压缩合并资产负债表中确认，因为该内容不符合资产确认的标准。
这些内容义务预计的付款时间如下（单位：千）：
截止日期为12月31日的年份
2024年（剩余3个月）$58,992 
2025139,175
202642,551
202715,735
20287,473
然后4,142
总内容义务$268,068 
信用证
截至2024年9月30日和2023年12月31日，公司有不可撤销的信用证，金额为$36.8 百万美元和美元37.5 百万美元，分别用于租赁办公设施。这些信用证的到期日是在2030年之前。截至2024年9月30日，$36.4百万美元的未偿信用证已由授信协议(见注释10)担保。
备用金
公司在其认为损失可能发生且可合理估计时，会对损失应急情况进行会计处理，包括知识产权许可和其他索赔的负债。这些应急情况至少每季度进行一次审查，并根据谈判、预计和解、法律裁决以及其他信息和事件的影响进行调整。然而，这些应急情况及其他法律程序的解决本质上是不可预测的，并且存在重大不确定性。
公司可能面临各种诉讼、股东衍生诉讼、集体诉讼、个体或大规模仲裁程序等各类型法律诉讼，以及其他类型的争议、索赔、监管或政府调查和审查，这些都属于业务常规范围。涉及商业、合同、消费者保护、隐私、数据保护、知识产权、税务、就业、公司治理和其他事项。尽管这些法律诉讼、争议、索赔、询问和调查的结果无法确定，但公司认为目前参与的任何事项的最终结果不太可能对其业务、财务状况或经营成果产生重大不利影响。但无论结果如何，这些法律诉讼、争议、索赔、询问和调查都可能对公司产生不利影响，因为涉及律师费、其他诉讼费用、和解费用、管理资源调配、声誉损害等因素。在截至2024年9月30日的三个和九个月内，公司没有任何重大损失准备金。
19
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补偿
在业务的正常过程中，公司已签订合同安排，为业务合作伙伴和其他相关方提供不同范围和条款的赔偿规定，涉及特定事项，包括但不限于因公司违反这些协议而导致的损失以及第三方提出的知识产权侵权索赔。公司在这些协议下的义务可能在时间或金额上受到限制，在某些情况下，公司可能对第三方有权利要求某些款项。此外，公司还与其董事及某些高管签署了赔偿协议，要求公司在其他事项中，赔偿他们因其作为董事或高管的身份或服务而可能产生的某些责任。
由于先前赔偿索赔的有限历史以及每项协议涉及的独特事实和情况，目前不可能确定在这些赔偿责任下的最大潜在金额。截至目前，公司尚未因此类义务产生任何重大成本，并且未在简明合并基本报表中计提与此类义务相关的任何负债。
13. 所得税
所得税费用为$4.1 百万美元和美元3.2 截至2024年9月30日和2023年分别为0.7百万美元的所得税支出。2024年9月30日结束的三个月的所得税支出增加主要是由于美国所得税责任增加。
所得税减免为$0.2 百万美元，而所得税费用为$8.4 百万美元，分别对截至2024年和2023年9月30日的九个月的增加主要归因于对某些外国递延税资产减值准备的释放，预计将根据未来预测的收入得到利用。
当预计递延税资产无法实现的可能性大于50%时，必须为递延税资产设立估值备抵。截至2024年9月30日，公司分析了所有可用的客观证据，包括正面和负面，认为某些递延税资产无法实现的可能性大于50%。因此，公司已为其美国递延税资产提供了估值备抵。
14. 每股净亏损
公司的基本每股净亏损是通过将净亏损除以该期间流通的普通股加权平均股数来计算的。公司采用两级法来计算每股净亏损。除非在公司修订和重述的公司章程中明确规定或法律另有要求，公司的A类普通股和B类普通股在投票、转换和转让权利方面具有相同的权利和特权，并且在各方面排名相同，共同分享，因此基本和稀释后的每股净亏损对于两个类别都是相同的。
在计算每股摊薄净亏损时，购买普通股和受限股单位的期权被视为普通股等价物。 通过应用库存法确定普通股的摊薄份额。 在净亏损期间，摊薄份额被排除在每股摊薄净亏损的计算之外，因为它们的效果是抗稀释的。
下表显示基本和稀释每股净损失的计算（以千为单位，除每股数据外）：
截至三个月截至九个月
2024年9月30日2023年9月30日2024年9月30日2023年9月30日
分子：
净损失$(9,030)$(330,071)$(93,838)$(631,270)
分母：
加权平均普通股份-基本和摊薄144,862141,877144,319141,087
基本每股净亏损和稀释净亏损$(0.06)$(2.33)$(0.65)$(4.47)
截至2024年9月30日的三个和九个月，未行使的股权奖励 15.9 普通股百万股不计入每股稀释净亏损的计算，因为它们具有抗稀释效应。
截至2023年9月30日的三个月和九个月，未发行的股份奖励为 15.8 百万股普通股因其抗稀释效应而被排除在每股稀释净亏损的计算之外。
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15. 分段信息
公司分为以下报告段: 二 报告的业务部门如下:
平台
平台营业收入来源于数字广告的销售（包括直接和程序化视频广告、媒体和娱乐推广支出，以及相关服务）和流媒体服务的分发（包括订阅和交易收入份额、Premium 订阅的销售，以及遥控器上品牌应用按钮的销售）。
设备
设备营业收入来自于销售流媒体播放器、Roku品牌电视、智能家居-脑机产品和服务、音频产品及相关配件，以及与服务运营商的许可协议所产生的收入。
占据10%或以上营业收入的客户如下：
 截至三个月截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
平台部门营业收入：
客户 I*13 %*13 %
客户J13 %*11%*
设备部门营业收入：
客户A23 %21 %22 %12 %
客户B15 %16 %20 %15 %
客户C25 %37 %27 %40 %
Customer K16 %***
* 少于10%
按照公司产品和服务交付的地点确定的地理营业收入，国际市场营业收入在每个期间中均不到10%。
开多资产，净值
下表列出了按地区划分的开多资产（净额），主要包括财产和设备及经营租赁使用权资产（单位：千元）：
截至
2024年9月30日2023年12月31日
美国$416,734$497,024
英国93,984109,315
其他国家26,60729,661
总计$537,325$636,000
公司在截至2024年和2023年9月30日的九个月内，针对某些营运租赁使用权资产和物业设备记录了减值费用。有关详情，请参阅简明合并基本报表附注16。
16. 重组
公司由于经济状况在2022财年的第四季度开始努力减少运营费用增长率。公司在截至2022年12月31日的年度内记录了员工解雇费用和与废弃科技资产相关的减值费用。
截至2023年12月31日，公司实施了包括整合办公空间利用、对内容组合进行战略评估、减少外部服务费用以及通过裁员和限制新招聘来减缓年度员工费用增长率等附加措施。因此，公司记录了与员工解雇费用相关的重组费用，这些费用主要包括遣散费、员工福利缴款、薪资税以及相关费用，以及与决定转租和停止使用某些办公设施相关的减值费用。
21
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以及相关的物业和设备，以及与在该期间从Roku频道移除特定许可和制作内容相关的减值费用。
截至2024年9月30日的三个月和九个月期间，公司的重组费用主要与员工解雇支出有关，包括遣散费、员工福利缴款、工资税及相关费用，以及与决定转租并停止使用某些办公设施和相关资产设备有关的减值费用。
重组费用记录如下（单位：千）：
截至2024年9月30日的三个月截至2023年9月30日的三个月
员工解雇设施退出成本资产减值损失总计员工解雇设施退出成本资产减值损失总计
营业成本，平台$— $— $— $— $764 $1 $61,995 $62,760 
营业成本，设备— — — — 408 6 2,792 3,206 
研发— 52 (1,418)(1,366)17,736 1,462 75,442 94,640 
销售和营销— 717 16,271 16,988 22,013 319 59,679 82,011 
一般和行政— 140 2,759 2,899 9,445 67 30,919 40,431 
总重组费用$— $909 $17,612 $18,521 $50,366 $1,855 $230,827 $283,048 
截至2024年9月30日的九个月截至2023年9月30日的九个月
员工解雇设施退出成本资产减值费用总计员工解雇设施退出成本资产减值损失总计
营业成本，平台$(3)$— $— $(3)$764 $1 $61,995 $62,760 
营业成本，设备1 — 5 6 408 6 2,792 3,206 
研发368 98 (603)(137)31,039 1,462 75,442 107,943 
销售和营销697 719 24,641 26,057 29,300 319 59,679 89,298 
一般和行政(116)117 5,075 5,076 14,230 1,670 35,257 51,157 
总重组费用$947 $934 $29,118 $30,999 $75,741 $3,458 $235,165 $314,364 
截至2024年9月30日的三个月资产减值费用主要包括$11.4 百万的经营租赁使用权资产减值和$6.5 百万的物业和设备减值。截至2024年9月30日的九个月资产减值费用包括$22.6 百万的经营租赁使用权资产减值和$7.0 百万的物业和设备减值，扣除$0.5 百万的其他开多负债和资产的调整。截至2023年9月30日的三个月资产减值费用包括$101.1 百万的经营租赁使用权资产减值，$68.1 百万的物业和设备减值，以及$61.6 内容资产减值为百万。截止到2023年9月30日的九个月内，资产减值费用包括$104.9 $百万的经营租赁使用权资产减值，$68.7 $百万的物业和设备减值，以及$61.6 $百万的内容资产减值。
员工终止重组费用和设施退出费用的期初和期末余额的调节，如下所示（以千为单位）：
截至2024年9月30日的三个月截至2023年9月30日的三个月
员工解雇设施退出成本总计员工解雇设施退出成本总计
开始余额$181 $839 $1,020 $422 $820 $1,242 
重组费用支出— 909 909 50,366 1,855 52,221 
已支付的款项(181)(326)(507)(3,128)(1,180)(4,308)
结束余额$— $1,422 $1,422 $47,660 $1,495 $49,155 
22
目录
截至2024年9月30日的九个月截至2023年9月30日的九个月
员工解雇设施退出成本总计员工解雇设施退出成本总计
开始余额$12,661 $1,198 $13,859 $22,093 $— $22,093 
重组费用已发生947 934 1,881 75,741 3,458 79,199 
已支付的款项(13,608)(710)(14,318)(50,174)(1,963)(52,137)
结束余额$— $1,422 $1,422 $47,660 $1,495 $49,155 
23
目录
项目2. 管理层对财务状况和业绩的讨论与分析
以下对我们的财务状况和经营结果的讨论与分析应与我们在本季度报告中其他部分包含的简明合并基本报表及相关注释，以及我们于2023年12月31日结束的年度报告中包含的审计合并基本报表一起阅读，该报告于2024年2月16日提交给证监会。
概览
我们的两个报告部门是平台部门和设备部门。平台营业收入来自数字广告销售（包括直接和程序化视频广告、媒体和娱乐推广支出以及相关服务）和流媒体服务分销（包括订阅和交易收入分成、高级订阅销售以及遥控器上品牌应用按钮的销售）。
设备营收来自流媒体播放器、罗克品牌电视（从2023年3月开始）、智能家居产品和服务、音频产品以及相关配件的销售，以及来自与服务运营商的许可安排的营收。我们期望继续管理罗克流媒体设备的平均售价，以增加我们的流媒体家庭规模。我们预计，从设备毛利润或亏损的权衡转向增加流媒体家庭规模，应会导致平台营业收入和平台毛利润随时间增长。
关键业绩指标和非GAAP财务指标
我们用来评估业务、衡量绩效、制定财务预测和做出战略决策的关键绩效指标目前是流媒体家庭数量、流媒体时长、每用户平均收入（“ARPU”）和自由现金流。
从2025年第一季度的业绩开始，我们将不再报告有关流媒体家庭和相应的用户平均收入（ARPU）的季度更新。自2017年首次在我们的首次公开募股中报告关键绩效指标以来，我们的业务和流媒体行业板块已经发生了显著变化。现在，我们主要关注我们的平台业务的营业收入增长和调整后的息税折旧摊销前盈利（调整后EBITDA）。因此，从2025年第一季度开始，我们的关键绩效指标将是流媒体小时数、平台营业收入、调整后EBITDA和自由现金流。
流媒体家庭
我们认为，流媒体家庭的数量是衡量用户基础规模的相关指标。我们将流媒体家庭定义为在报告期内过去30天内在我们平台上观看过内容的不同用户账户数量。我们将这些账户称为“流媒体家庭”，因为一个用户账户不一定代表一个单独的观众或单一的Roku流媒体设备。实际上，一个账户可以由多个观众使用，并且可以链接到多个设备。因此，我们可能会在一个单一住所内识别到多个流媒体家庭，同时多个住所可能构成一个流媒体家庭。
仅在非Roku平台上观看The Roku Channel内容的用户数不包括在此指标中。此外，仅注册账户以使用我们某一个智能家居-脑机产品的用户数也不包括在我们报告的流媒体家庭数量中。
截至2024年9月30日，我们有8550万和7580万流媒体家庭，分别较2023年增长了13%。
观看时间
我们认为平台上的流媒体小时数是用户参与度的有效衡量标准，并且在我们平台上流媒体内容的小时数增长反映了我们在满足日益增长的用户对电视流媒体的需求方面取得的成功。我们将流媒体小时定义为在特定时期内Roku流媒体设备在我们平台上流媒体内容的累计时长。非Roku平台上从The Roku Channel流媒体的小时数不包括在此指标中。此外，智能家居产品不会增加我们的流媒体小时数。我们按日历基准报告流媒体小时数。
此外，我们相信，随着时间的推移，增加用户在我们流媒体平台上的参与度将提高我们平台的盈利能力，因为我们通过各种形式的用户参与获得平台营业收入，包括广告，以及订阅和点播视频的收入分成。然而，我们来自内容合作伙伴的收入与他们的流媒体应用程序上被观看的小时数并不相关，流媒体小时数与来自这些内容合作伙伴的收入或每用户平均收入（ARPU）在每个周期之间没有关联。此外，平台上的流媒体小时数在Roku流媒体设备播放内容时被计量，无论观众是否在积极观看。例如，如果Roku播放器连接到电视，而观众关闭了电视、离开或睡着而没有停止或暂停播放器，则特定的流媒体应用可能会继续播放内容。
24
目录
由流媒体应用程序确定的一段时间。我们相信这也会出现在多种非Roku流媒体设备和其他机顶盒上。
自2020年第一季度以来，我们所有的Roku流媒体设备均包含一个名为Roku OS的功能，旨在识别应用上的内容在没有用户互动的情况下连续播放了一段时间。我们称之为“您仍在观看”的这一功能会定期提示用户确认他们仍在观看所选应用，并在用户没有积极回应时关闭该应用。我们认为在Roku平台上实施这一功能对我们、我们的客户、内容合作伙伴和广告商都有好处。我们的一些主要内容合作伙伴，包括奈飞，也在其应用中实施了类似的功能。这一Roku OS功能是这些应用功能的补充。这一功能并未对我们未来的财务表现产生过实质影响，也不预计会有。
我们在截至2024年9月30日和2023年9月30日的三个月内分别直播了320亿小时和267亿小时，反映出增长了20%。
每用户平均营业收入
我们用ARPU来衡量平台营收进展，我们认为这代表了我们业务的内在价值。我们将ARPU定义为过去四个季度的平台注册收入除以当前期间末和上一年对应期间末的平均流媒体家庭数量。ARPU衡量的是我们变现我们 流媒体家庭 基础和我们平台业务的进展。
截至2024年9月30日，ARPU相对稳定，达到了41.10美元，与2023年9月30日的41.03美元相比变化不大。这反映了平台营业收入和流媒体家庭的增长率相对一致。
自由现金流（非GAAP指标）
我们使用自由现金流作为主要指标来衡量我们业务的表现，因为我们相信最大化自由现金流有助于表明我们业务的财务实力，并提供业务产生或（使用）的现金的指示。我们的目标是持续增加自由现金流。我们将自由现金流定义为过去12个月（“TTM”）的经营活动现金流量，不包括购买固定资产的影响和汇率对现金的影响。
我们的自由现金流分别为2024年和2023年截至9月30日的TTM期间为1.573亿美元和1.008亿美元。
自由现金流是一项非通用会计原则的财务指标。 自由现金流调解排除了购买固定资产和设备以及汇率对经营活动现金流的影响，在适用的情况下。我们认为自由现金流对评估我们持续运营绩效和增进对过往财务绩效的整体理解是有用的补充。然而，这一非通用会计原则的财务指标存在局限性，不应孤立使用，也不应作为我们通用会计原则的财务信息（例如通用会计准则下的经营活动现金流）的替代。有关经营活动现金流的更多信息，请参阅下文的“流动性和资本资源”。此外，由于计算方法的差异，自由现金流可能无法与其他公司类似标题的指标进行比较。
下表展示了自由现金流与每个所示期间最直接可比的GAAP财务指标的调节（单位：千）:
过去12个月结束
2024年9月30日2023年9月30日
经营活动产生的净现金流量$155,080 $246,882 
减:购买固定资产(6,123)(144,477)
汇率变动对现金、现金等价物及受限制现金的影响的增加/减少8,392 (1,599)
自由现金流（过去十二个月）$157,349 $100,806 
25
目录
业绩报告中的元件
收入
平台营业收入
我们通过销售数字广告（包括直接和程序化视频广告、媒体和娱乐促销支出及相关服务）以及流媒体服务分发（包括订阅和交易收入分成、销售Premium 订阅以及在遥控器上销售品牌应用按钮）来产生平台营业收入。我们的广告库存包括来自Roku频道的AVOD内容的视频广告库存、Roku主屏幕和屏保上的原生苹果-显示屏广告，以及通过与内容合作伙伴的流媒体服务分发协议获得的广告库存。为了补充供应，我们根据需要从内容合作伙伴购买广告库存。迄今为止，我们的大部分平台营业收入来自美国。
设备营业收入
我们通过销售流媒体播放器、Roku品牌电视、智能家居-脑机产品和服务、音频产品及相关配件来产生设备营业收入。我们的设备营业收入还包括与服务运营商的许可协议。我们大部分设备营业收入来自美国。在我们的国际市场上，我们主要通过批发分销商销售设备，批发分销商再将其销售给零售商。
营业成本
营业收入成本，平台
营业收入成本，平台主要包括与获取广告库存相关的成本，以及内容的摊销成本，这些内容包括取得许可证和自主制作的内容，以及与内容的分享。 合作伙伴营业收入成本，平台还包括其他成本，例如支付处理费用，与我们服务交付相关的分配费用，这些费用主要包括第三方云服务的成本，以及我们的平台运营人员的工资、福利和基于股票的补偿，以及已收购开发科技的摊销。
营业收入，设备
设备的营业收入成本主要包括支付给第三方制造商的制造成本，这些设备包括流媒体播放器、Roku品牌电视、音频产品和智能家居产品。设备的营业收入成本还包括我们出售的设备上的科技许可证或特许权使用费、进出口运费、关税和物流成本、第三方包装、库存准备金，以及与设施、第三方云服务和运营人员的薪资、福利和基于股票的补偿相关的分摊间接费用。
营业费用及其他费用
研发
研究和开发费用主要包括我们的开发团队的薪资、福利和基于股票的补偿，以及外包开发费用。此外，研究和开发费用还包括分配的设施和间接费用。
销售和市场
销售和市场营销费用主要包括工资、福利、佣金和股票补偿，以支付从事销售和销售客户支持、市场营销、通信-半导体、数据科学和分析、业务拓展、产品管理和合作伙伴支持职能的员工。销售和市场营销费用还包括市场营销、零售和商品费用，以及分配的设施和间接费用。
一般和行政
一般和行政支出主要包括为我们的财务、法律、信息技术、人力资源、业务运营支持和其他行政人员支付的工资、福利和股票补偿。一般和行政支出还包括外部法律、会计和其他专业服务费，以及分配的设施和一般性费用。
其他净收入
截至2024年9月30日和2023年9月的三个月和九个月，其他收入净额主要包括现金及现金等价物的利息收入，以及可转换票据的战略投资的公允价值净变动（请参见本季度报告第一部分，第1项中的基本报表第7条）。
所得税费用（收益）
我们的所得税费用（收益）主要包括我们在某些外国辖区的业务所得税和美国的所得税。我们对美国的净递延税资产有全面的估值准备。截止到2024年9月30日的九个月期间，我们解除了一些外国递延税资产的估值准备，并确认了所得税收益。
26
目录
运营结果
以下表格列出了所示时期营业收入占总收入比例的精选简明合并经营数据。
 截至三个月截至九个月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
净营业额：
平台85 %86 %85 %87 %
设备15 %14 %15 %13 %
总净收入100 %100 %100 %100 %
营收成本:
平台39 %45 %40 %43 %
设备16 %15 %16 %14 %
总成本费用55 %60 %56 %57 %
毛利润（损失）：
平台46 %41 %45 %44 %
设备(1)%(1)%(1)%(1)%
总毛利润45 %40 %44 %43 %
营业费用：
研发17 %31 %18 %28 %
销售和营销22 %34 %23 %31 %
一般和行政9 %14 %9 %12 %
总营业费用48 %79 %50 %71 %
营业亏损(3)%(39)%(6)%(28)%
其他收入，净额3 %3 %3 %3 %
税前损失— %(36)%(3)%(25)%
所得税费用（利益）— %— %— %— %
净损失— %(36)%(3)%(25)%
27
目录
截至2024年9月30日和2023年9月30日三个月和九个月的比较
净营业收入
截至三个月截至九个月
2024年9月30日2023年9月30日更改 $变动%2024年9月30日2023年9月30日更改 $变动%
(以千为单位，除了百分比)
平台$908,175 $786,785 $121,390 15 %$2,487,443 $2,165,238 $322,205 15 %
设备154,028 125,233 28,795 23 %424,408 334,956 89,452 27 %
总净收入$1,062,203 $912,018 $150,185 16 %$2,911,851 $2,500,194 $411,657 16 %
平台
在2024年9月30日结束的三个月内，平台营业收入增加了1.214亿美元，或15％，与2023年9月30日结束的三个月相比。增长主要是由于来自流媒体服务分销的营收增加，如内容订阅和通过Roku频道的高级订阅的营收份额，以及更高的广告收入，尽管媒体和娱乐行业仍然疲软。
平台营业收入在截至2024年9月30日的九个月内增加了3.222亿美元，或15%，与截至2023年9月30日的九个月相比。增幅主要归因于流媒体服务分发的营业收入增加，例如内容订阅和通过Roku频道的高级订阅的收入分享，以及广告收入的增加，尽管媒体和娱乐领域仍持续疲软。
设备
截至2024年9月30日的三个月内，设备营业收入相比于截至2023年9月30日的三个月增长了2880万元，增幅为23%。增长主要是由于Roku品牌电视的营业收入增加，抵消了流媒体播放器和配件的营业收入下降。在截至2024年9月30日的三个月内，所有设备的平均卖出价格增加了11%，所有设备的成交量增加了13% ，与截至2023年9月30日的三个月相比。平均卖出价格的增长是由于Roku品牌电视的销售增加，通常其售价高于流媒体播放器。设备成交量的增加主要是由于Roku品牌电视销售的提升。
截至2024年9月30日的九个月内，设备营业收入较2023年9月30日的九个月增加了8950万美元，增长了27%。增幅主要由于Roku品牌电视的营业收入增加，以及在较小程度上，流媒体播放器和配件的营业收入增加。这一增长被与服务运营商的许可协议营业收入下降以及音频和智能家居-脑机产品和服务营业收入下降所抵消。 截至2024年9月30日的九个月内，所有设备的平均售价增加了20%，所有设备的成交量增加了9% 与截至2023年9月30日的九个月相比，平均售价的上涨主要是由于Roku品牌电视的销量增加，因为其一般售价高于流媒体播放器。设备的成交量增加主要是由于Roku品牌电视销量较高，以及在较小程度上，流媒体播放器销量的增加，而智能家居-脑机产品的销量下降对此进行了抵消。
28
目录
收入成本
截至三个月截至九个月
2024年9月30日2023年9月30日更改 $变动%2024年9月30日2023年9月30日更改 $变动%
(以千为单位，除了百分比)
营收成本:
平台$416,396 $408,554 $7,842 2 %$1,161,416 $1,057,151 $104,265 10 %
设备165,732 134,641 31,091 23 %457,369 358,352 99,017 28 %
总成本费用$582,128 $543,195 $38,933 7 %$1,618,785 $1,415,503 $203,282 14 %
平台
与2023年9月30日结束的三个月相比，截至2024年9月30日，营业收入平台的成本增加了780万美元，增长了2%。这一增长主要是由于获取内容成本的增加、广告库存成本的增加以及更高的信用卡处理费用，部分抵消了与内容资产相关的较低减值费用和较低的内容资产摊销。
在2024年9月30日结束的九个月内，相较于2023年9月30日结束的九个月，营业收入平台成本增加了10430万美元，增长了10%。这一增加主要是由于内容采购成本的增加、内容资产的减值、以及信用卡处理费用的提高所致，部分抵消了与内容资产相关的较低减值费用、较低的内容资产摊销费用，以及较低的广告库存成本。
设备
截至2024年9月30日的三个月内，营业收入成本和设备成本增加了3110万美元，或23%，相比于截至2023年9月30日的三个月。增长主要是由于制造成本增加了3480万美元，主要是由于生产Roku品牌电视的制造成本增加，以及运费成本增加了1100万美元。这些增加部分被较低的特许权使用费成本520万美元和较低的重组费用320万美元所抵消。
截至2024年9月30日的九个月内，设备的营业收入成本增加了9900万美元，增长了28%，而截至2023年9月30日的九个月内的营业收入成本。增长的主要原因是制造成本增加了8700万美元，主要是由于制造Roku品牌电视的成本，以及运输成本增加了2010万美元。
营业费用
截至三个月截至九个月
2024年9月30日2023年9月30日更改 $变动%2024年9月30日2023年9月30日更改 $变动%
(以千为单位，除了百分比)
研发$178,798 $282,201 $(103,403)(37)%$534,738 $694,673 $(159,935)(23)%
销售和营销237,047 307,694 (70,647)(23)%660,827 768,805 (107,978)(14)%
一般和行政99,993 128,717 (28,724)(22)%276,543 309,422 (32,879)(11)%
总营业费用$515,838 $718,612 $(202,774)(28)%$1,472,108 $1,772,900 $(300,792)(17)%
研发费用
在2024年9月30日结束的三个月内，研发费用减少了10340万美元，降低了37%；较2023年9月30日结束的三个月，由于重组费用降低了9600万美元、办公设施和制造行业基础设施费用降低了520万美元，以及人员相关费用降低了2.0百万美元。
在截至2024年9月30日的九个月内，研发费用减少了15990万元，或23%，与截至2023年9月30日的九个月相比。这一减少主要是由于重组费用下降了10810万元，人事相关费用下降了2820万美元，办公设施和It制造行业的费用下降了1540万美元，咨询费用降低了660万美元。
29
目录
销售和营销
截至2024年9月30日的三个月内，销售和市场费用减少了7060万美元，下降了23%，与截至2023年9月30日的三个月相比。这一下降主要是由于重组费用减少了6500万美元，办公室设施和制造行业费用减少了530万美元，以及与人员相关的费用减少了360万美元，这部分被增加的咨询费用160万美元所抵消。
在2024年9月30日结束的九个月内，销售和营销费用减少了10800万美元，或14%，相比2023年9月30日结束的九个月。这一减少是由于重组费减少了6320万美元，人员相关费用减少了2980万美元，办公场所设施和IT基础设施费用减少了1190万美元，以及市场营销、零售和商品费用减少了770万美元，部分抵消了咨询费用增加的350万美元。
一般和管理费用
截至2024年9月30日结束的三个月，总务及行政费用比2023年9月30日结束的三个月减少了2870万美元，降低了22%。主要是由于重组费用降低了3750万美元，坏账费用减少了120万美元，办公设施和IT制造行业支出降低了100万美元，部分抵消了法律和咨询费用增加1080万美元以及人员相关费用增加220万美元。
截至2024年9月30日止九个月，管理和行政开支减少了3290万美元，或11%，相比于2023年9月30日止九个月。这一降低是由于重组费用减少4610万美元，办公设施和IT基础设施开支减少250万美元，以及人员相关开支减少130万美元，部分抵消了法律和咨询费用增加1670万美元。
其他净收入
截至三个月截至九个月
2024年9月30日2023年9月30日更改 $变动%2024年9月30日2023年9月30日更改 $变动%
(以千为单位，除了百分比)
其他收入，净额$30,880 $22,902 $7,978 35 %$84,955 $65,317 $19,638 30 %
其他收入净额在截至2024年9月30日的三个月内增加了800万美元，或35%，与截至2023年9月30日的三个月相比。增加主要是由于现金余额增加导致的200万美元的利息收入增加，主要由于可转换票据的战略投资公允价值变动相关的未实现收益增加的270万美元的其他收入增加，以及由于汇率波动带来的340万美元的汇率期货收益。
2024年9月30日止的九个月中，其他收入净额增加了1960万美元，增长了30%，相比于2023年9月30日止的九个月。这一增长主要是由于由于现金余额增加而带来的1220万美元的利息收入增加，其他收入增加了370万美元，主要是由于与可转换可赎回票据的战略投资的公允价值变动相关的未实现收益增加，以及因汇率波动而带来的280万美元的汇率期货收益。
所得税费用（收益）
截至三个月截至九个月
2024年9月30日2023年9月30日更改 $变动%2024年9月30日2023年9月30日更改 $变动%
(以千为单位，除了百分比)
所得税费用（利益）$4,147 $3,184 $963 30 %$(249)$8,378 $(8,627)(103)%
2024年9月30日结束的三个月中，所得税费用比2023年9月30日结束的三个月增加了100万美元，主要是由于美国税收责任增加。
截至2024年9月30日的九个月内，所得税费用较截至2023年9月30日的九个月减少了860万美元，主要是由于对某些外国递延税资产估值准备的解除带来的税收收益。
30
目录
非GAAP财务指标
截至2024年9月30日，我们的现金及现金等价物为212700万美元。我们的现金中约有6%存放在美国以外的账户中，这些账户由我们的外国子公司持有，用于资助海外运营。
我们的主要现金来源是来自平台和设备的营业收入。现金的主要使用包括营业收入的成本，包括获取广告库存的成本、许可证和制作内容的成本、我们产品的第三方制造成本，以及其他营业费用，如与人员相关的费用，包括员工遣散付款、咨询和专业服务费用、设施费用和营销费用。其他现金使用包括购买物业和设备以及并购。
我们在过去追求过并购活动，并且未来可能会继续追求额外的并购活动，包括收购编程和内容资产的权利。尽管我们不预计在设施和建筑相关成本上支出会与过去几年的水平相当，但为了支持我们业务的未来增长，我们将继续在维护设施和购置计算机系统及其他财产和设备上产生费用。这些活动可能会对我们的流动性和资本资源产生重大影响。
我们相信我们现有的现金及现金等价物余额，以及我们信贷协议下未提取的可用余额（将在下面进一步讨论），将足以满足我们未来十二个月及更长时间的营运资金、资本支出和已知合同义务的重大现金需求。我们的未来资本需求、可用资金的充足性以及来自运营的现金流，可能会受到各种风险和不确定因素的影响，包括但不限于在本季度报告的第二部分，第一项A，风险因素中详细列出的那些因素，以及当前宏观经济环境的影响。虽然到目前为止，当前的宏观经济环境并未严重影响我们的流动性和资本资源，但它对地方经济以及资本和信贷市场造成了扰动和波动，这可能在未来对我们的流动性和资本资源产生不利影响。
我们可能会通过发行股权证券或其他融资安排来尝试筹集额外资金。如果我们通过发行股权筹集资金，现有股东的股份将被稀释。如果我们通过承担债务来筹集额外融资，我们可能会面临固定的支付义务和限制性条款。此外，由于当前的宏观经济环境，我们可能无法以我们可以接受的条款获得债务或股权融资。
Debt
在2024年9月16日，我们与公司（作为借款人）、部分子公司（作为担保人）、参与的贷方和发行银行以及作为管理代理的花旗银行（“信贷协议”）签订了信贷协议，该协议提供了（i）一项为期五年的循环信贷额度，总本金金额最高可达30000万美元，以及（ii）在满足某些惯例条件的情况下，可以行使的最高额外300.0百万美元的非承诺增加选项。信贷协议规定了10000万美元的次级设施用于信用证的签发，且某些现有信用证被视为在此设施下未结清。信贷协议将在2029年9月16日到期。信贷协议的收益可用于一般企业用途，包括融资营运资金需求。
根据信贷协议，我公司及作为信贷协议担保方的子公司的几乎所有资产均受到保护。在某些情况下，我们可以提前偿还信贷协议下的贷款，有时也必须提前偿还贷款，而无需支付溢价。信贷协议还包括惯例的陈述和保证、惯例的肯定和否定契约、财务契约要求保持最低利息覆盖比率和最大总净杠杆比率，以及惯例的违约事件，一旦发生这些违约事件，可能导致在信贷协议下借入的金额到期应付，并导致在其计划的2029年9月16日终止日期之前，尚未履行的承诺被终止。
截至2024年9月30日，我们拥有由信用协议担保的优秀信用证，金额为3640万美元。截至2024年9月30日，我们尚未根据信用协议借款，并且我们符合信用协议的所有契约。
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现金流
下表总结了所呈现期间的现金流（单位：千元）：
截至九个月
2024年9月30日2023年9月30日
压缩的综合现金流量表数据:
经营活动产生的现金流量$138,753 $239,529 
投资活动产生的现金流量净额$(22,603)$(89,099)
用于筹资活动的现金流量$(56,732)$(65,301)
经营活动现金流
我们的运营活动在截至2024年9月30日的九个月内提供了13880万美元的现金。我们在截至2024年9月30日的九个月内的净亏损为9380万美元，已通过548.0百万美元的非现金费用进行调整，主要包括基于股票的补偿、内容资产的摊销和注销、物业和设备及无形资产的折旧和摊销、运营租赁使用权资产的摊销以及资产减值。我们运营资产和负债的变化使用了315.4百万美元的现金，主要由于应付账款因支付时间而减少、用于收购内容的付款、用于运营租赁负债的付款、递延收入的减少、预付费用和其他流动资产的增加、其他长期资产的增加以及库存的增加。这部分被应收账款余额的减少和应计负债的增加所抵消。
投资活动现金流
截至2024年9月30日的九个月中，我们的投资活动包括现金流出2260万美元，其中包括260万美元的物业和设备购买，以及2000万美元的战略投资购买。
融资活动现金流
截至2024年9月30日的九个月内，我们的融资活动使用了5670万美元的现金。现金流出主要与我们在此期间对归属的股权奖励净结算所支付的6390万美元税款以及与我们的信贷协议相关的180万美元发行费用有关，部分被员工股票期权行使所得的900万美元所抵消。
已知合同义务的资金需求
截至2024年9月30日，我们已知合同义务的实际现金需求包括：
•Commitments to purchase finished goods from our contract manufacturers and other inventory related items. Consistent with industry practices, we enter into firm, non-cancelable, and unconditional purchase commitments with our contract manufacturers to acquire products through a combination of purchase orders, supplier contracts, and open orders based on projected demand information. Our contract manufacturers source components and build our products based on these demand forecasts. Changes to projected demand or in the subsequent sales mix of our products may result in us being committed to purchase excess inventory to satisfy these commitments. For additional information regarding manufacturing purchase commitments, see Note 12 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
•Commitments to license content from content partners and produce content under contractual arrangements. For additional information regarding content commitments, see Note 12 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
•Operating lease liabilities that are included in our condensed consolidated balance sheets and liabilities related to the lease arrangements that have not yet commenced. For additional information regarding our lease liabilities, see Note 9 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report. Our restructuring efforts to consolidate office space did not materially change our operating lease obligations.
The contractual commitments discussed above are associated with agreements that are enforceable and legally binding. Obligations under contracts that we can cancel without a significant penalty are not included above.
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Critical Accounting Policies and Estimates
Our financial statements are prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. These estimates and assumptions are based on historical experience, current trends and other factors that we believe to be reasonable at the time our condensed consolidated financial statements are prepared. We evaluate our estimates and assumptions on an ongoing basis. There have been no material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in our Annual Report.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Fluctuation Risk
Our exposure to interest rate risk relates to the interest income generated by cash and cash equivalents. The primary objective of our investment policy is to preserve principal while maximizing income without significantly increasing risk. We believe that an increase or decrease in interest rates of 100 basis points on our cash and cash equivalents balance would impact our interest income by an additional increase or decrease of $21.0 million.
Foreign Currency Exchange Rate Risk
Most of our revenue is generated within the United States and as such we have minimal foreign currency risk related to our revenue. Our foreign currency risk primarily relates to operating expenses, cash balances, and lease liabilities denominated in currencies other than U.S. dollars, primarily British pounds and Euros. Our results of current and future operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates.
We have experienced and will continue to experience fluctuations in our net income as a result of transaction gains or losses related to revaluing monetary asset and liability balances that are denominated in currencies other than the functional currency of the entities in which they are recorded. We have not entered into any derivatives or other financial instruments in an attempt to hedge our foreign currency exchange risk, but we may do so in the future.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.
Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended September 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION
Item 1. Legal Proceedings
Information with respect to this item may be found in Note 12 to the condensed consolidated financial statements, Part I, Item 1 of this Quarterly Report and is incorporated herein by reference.
Item 1A. Risk Factors
Our business involves significant risks, some of which are described below. You should carefully consider the risks and uncertainties described below, together with all the other information in this Quarterly Report, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the condensed consolidated financial statements and the related notes. If any of the following risks actually occur, our business, reputation, financial condition, results of operations, revenue, key performance metrics (including Streaming Households, Streaming Hours, ARPU, and Free Cash Flow), and future prospects could be seriously harmed. In addition, you should consider the interrelationship and compounding effects of two or more risks occurring simultaneously. Unless otherwise indicated, references to our business being harmed in these risk factors will include harm to our business, reputation, financial condition, results of operations, revenue, key performance metrics, and future prospects. In that event, the market price of our Class A common stock could decline, and you could lose part or all of your investment. You should not interpret our disclosure of any of the following risks to imply that such risks have not already materialized. The risks facing our business have not changed substantively from those discussed in our Annual Report, filed with the SEC on February 16, 2024, except for those risks marked with an asterisk (*).
Risk Factors Summary
Below is a summary of the principal factors that make an investment in our Class A common stock speculative or risky:
Risks Related to Our Business and Industry
•the highly competitive nature of the TV streaming industry that is rapidly evolving;
•our ability to grow revenues from advertising on our platform;
•our ability to further monetize our streaming platform;
•our ability to successfully work with third-party demand sources and run our demand-side platform;
•our ability to develop, maintain, and expand relationships with licensed Roku TV partners, manufacturing partners, and service operators;
•our ability to establish and maintain relationships with important content partners;
•popular or new content publishers not publishing their content on our streaming platform;
•the non-renewal or early termination of our agreements with content partners;
•maintaining an adequate supply of quality video advertising inventory on our platform and effectively selling the available supply;
•content partners electing not to participate in platform features that we develop;
•irrelevant or unengaging advertising campaigns on our streaming platform;
•our ability to operate and monetize The Roku Channel;
•users signing up for offerings and services outside of our platform;
•our and our licensed Roku TV partners’ ability to develop, maintain, and expand relationships with important retail sales channels that we and they rely on to sell our streaming devices and other products;
•our ability to build a strong brand and maintain customer satisfaction and loyalty;
•advertiser or advertising agency delayed payment or failure to pay;
•maintaining adequate customer support levels;
•our introduction of new products and services;
•our and our licensed Roku TV partners’ reliance on contract manufacturers and limited manufacturing capabilities;
•our reliance on licensed Roku TV partners’ operations for the supply of Roku TV models;
•our ability to forecast manufacturing requirements and manage our supply chain and inventory levels;
•decreased availability or increased costs for materials and components used in the manufacturing of our products and our licensed Roku TV partners’ products;
•our ability to obtain key components from sole source suppliers;
•interoperability of our products with content partners’ and other third parties’ offerings, technologies, and systems;
•detecting hardware defects and software errors in our products before they are released to end users;
•component manufacturing, design, or other defects that may render our products permanently inoperable;
•our ability to obtain or maintain necessary or desirable licenses, certifications, or approvals related to our use or support of third-party technology, intellectual property, or services;
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•our use of artificial intelligence (“AI”) technologies in some of our products and services;
Risks Related to Operating and Growing Our Business
•our history of operating losses;
•volatility of our quarterly operating results that could cause our stock price to decline;
•our ability to manage our growth;
•our ability to successfully expand our international operations;
•seasonality and other potential fluctuations in our business and their impact on our revenue and gross profit;
•attracting and retaining key personnel and managing succession;
•maintaining systems that can support our growth, business arrangements, and financial rules;
•our ability to successfully complete acquisitions and investments and integrate acquired businesses;
•our ability to comply with the terms of our outstanding credit facility;
•our ability to secure funds to meet our financial obligations and support our planned business growth;
•adverse developments affecting financial institutions, including bank failures;
Risks Related to Cybersecurity, Reliability, and Data Privacy
•data security incidents, including cybersecurity attacks, or other significant disruptions of our information technology systems that could adversely affect our business and subject us to liability;
•legal obligations and potential liability or reputational harm related to our collection, storage, and use of personal and confidential information related to the users of our products and services and cybersecurity incidents;
•disruptions in information technology systems or other services that result in a degradation of our platform;
•changes in how network operators manage data that travel across their networks;
Risks Related to Intellectual Property
•intellectual property infringement claims and litigation resulting in significant costs or the loss of important intellectual property rights;
•failure or inability to protect or enforce our intellectual property or proprietary rights;
•our use of open-source software;
•our agreements to indemnify certain of our partners if our technology is alleged to infringe on third parties’ intellectual property rights;
Risks Related to Macroeconomic Conditions
•the impact of macroeconomic conditions, natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events on our business;
Legal and Regulatory Risks
•lawsuits and other legal proceedings, disputes, claims, and government inquiries and investigations;
•enactment of or changes to government regulation or laws related to our business;
•changes in U.S. or foreign trade policies, geopolitical conditions, and general economic conditions that impact our business;
•U.S. or international rules (or the absence of rules) that permit internet access network operators to degrade users’ internet service speeds or limit internet data consumption by users;
•liability for content that is distributed through or advertising that is served through our platform;
•our ability to maintain effective internal controls over financial reporting;
•the impact of changes in accounting principles;
•compliance with laws and regulations related to the payment of income taxes and collection of indirect taxes;
•changes to U.S. or foreign taxation laws or regulations;
Risks Related to Ownership of Our Class A Common Stock
•the dual class structure of our common stock;
•volatility in the market price of our Class A common stock;
•potential dilution or a decline in our stock price caused by future sales or issuance of our capital stock or rights to purchase capital stock;
•a decline in our stock price caused by future sales by existing stockholders;
•dependency on favorable securities and industry analyst reports;
•the significant legal, accounting, and other expenses associated with being a publicly traded company;
•the absence of dividends on our Class A or Class B common stock;
•anti-takeover provisions in our charter and bylaws; and
•the limitations resulting from our selection of the Delaware Court of Chancery and the U.S. federal district courts as the exclusive forums for substantially all disputes between us and our stockholders.
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Risks Related to Our Business and Industry
The TV streaming industry is highly competitive and many companies, including large technology companies, content owners and aggregators, TV brands, and service operators, are actively focusing on this industry. If we fail to differentiate our streaming platform and compete successfully with these companies, it will be difficult for us to attract and retain users and our business will be harmed.*
The TV streaming industry is highly competitive and global. Our success depends in part on attracting users to and retaining users on, and the effective monetization of, our streaming platform. To attract and retain users, we need to be able to respond efficiently to changes in user tastes and preferences and to offer our users access to the content they love on terms that they accept. Effective monetization requires us to continue to update the features and functionality of our streaming platform for users, content partners, and advertisers. We also must effectively support popular sources of streaming content that are available on our platform, such as Amazon Prime Video, Disney+, Hulu, Max, Netflix, and YouTube. And we must respond rapidly to actual and anticipated market trends in the TV streaming industry.
Large companies such as Amazon, Apple, and Google offer TV streaming devices that compete with Roku streaming devices made by us and our licensed Roku TV partners. In addition, Google licenses its Android operating system software for integration into smart TVs and service provider set-top boxes, and Amazon licenses its operating system software for integration into smart TVs and sells Amazon-branded smart TVs. If Walmart’s pending acquisition of Vizio is consummated, we may face increased competition from Walmart, which currently makes and sells Onn. branded streaming products, including co-branded Roku TV models. These companies have greater financial resources than we do and can subsidize the cost of their streaming devices or licensing arrangements in order to promote their other products and services, which could make it harder for us to acquire new users, retain existing users, increase Streaming Hours, and monetize our streaming platform. These companies could also implement standards or technology that are not compatible with our products or that provide a better streaming experience. These companies also have greater resources to promote their brands through advertising than we do.
In addition, many TV brands offer their own TV streaming solutions within their TVs. Other devices, such as game consoles, also incorporate TV streaming functionality. Similarly, some service operators, such as Comcast and Charter Communications (and their joint venture, Xumo, LLC), offer TV streaming applications and devices as part of their cable service plans and can leverage their existing user bases, installation networks, broadband delivery networks, and name recognition to gain traction in TV streaming. If viewers of TV streaming content prefer alternative products to Roku streaming devices, we may not be able to achieve our expected growth in platform revenue, gross profit, and our key performance metrics.
We also compete for Streaming Hours with mobile streaming applications on smartphones and tablets, and users may prefer to view streaming content on such applications. Increased use of mobile or other platforms for TV streaming could adversely impact the growth of our Streaming Hours, harm our competitive position, and otherwise harm our business.
We expect competition in TV streaming from the large companies and service operators described above, as well as new and growing companies, to continue to increase in the future. This increased competition could result in pricing pressure, lower revenue and gross profit, declines in our key performance metrics, or the failure of Roku streaming devices, our streaming platform, or our other products to gain or maintain broad market acceptance. To remain competitive and maintain our position as a leading TV streaming platform, we need to continuously invest in our platform, product development, marketing, service and support, and device distribution infrastructure. In addition, evolving TV standards and unknown future developments may require further investments in the development of Roku streaming devices, our streaming platform, and our other products. We may not have sufficient resources to continue to make the investments needed to maintain our competitive position. In addition, many of our competitors have longer operating histories, greater name recognition, larger customer bases and significantly greater financial, technical, sales, marketing, and other resources than us, which provide them with advantages in developing, marketing, or servicing new products and offerings. As a result, they may be able to respond more quickly to market demand, devote greater resources to the development, promotion, sales, and distribution of their products or their content, and influence market acceptance of their products better than we can. These competitors may also be able to adapt more quickly to new or emerging technologies or standards and may be able to deliver products and services at a lower cost. Increased competition could reduce our sales volume, revenue, and operating margins, increase our operating costs, harm our competitive position, and otherwise harm our business.
To enhance our users’ experience, we also offer our own lines of Roku-branded smart home products and services, and audio products, including wireless speakers and subwoofers. As a result, we face additional competition from other brands of smart home products and audio products. If these products do not operate as designed or do not enhance the TVs powered by the Roku OS or other viewing experiences as we intend, our users’ overall viewing experience may be diminished, and this may impact the overall demand for our products and our partners’ Roku TV models.
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Our future growth depends our ability to grow revenues from advertising on our streaming platform.*
We operate in a highly competitive advertising industry and compete for revenue from advertising with other streaming platforms and services, including social media and other digital platforms, as well as traditional media, such as radio, broadcast, cable and satellite TV, and satellite and internet radio. These competitors offer content and other advertising mediums that may be more attractive to advertisers than our streaming platform. These competitors are often very large and have more advertising experience and financial resources than we do, which may adversely affect our ability to compete for advertisers and may result in lower revenue and gross profit from advertising, and lower ARPU and Free Cash Flow. For example, many major SVOD services, including Netflix, Disney+, and Amazon Prime Video now have ad-supported SVOD tiers, which has further increased competition for streaming TV advertising revenue. These services, as well as other services such as YouTube, Tubi, and Pluto, sell (either through direct sales or programmatically through third parties) ad inventory in their ad-supported content that is distributed on our streaming platform. If we are unable to increase our revenue from advertising by, among other things, continuing to improve our streaming platform’s capabilities to further optimize and measure advertisers’ campaigns; continuing to increase our streaming platform’s reach; increasing, differentiating, and selling our advertising inventory, including video ad inventory we sell in The Roku Channel, video ad inventory that we acquire through our streaming services distribution agreements, and native display ads on the Roku Home Screen and throughout our streaming platform; innovating our ad product offerings; and maintaining a strong advertising sales team and programmatic capabilities, our business and our growth prospects may be harmed. We may not be able to compete effectively or adapt to industry changes or trends, which would harm our ability to grow our advertising revenue and would harm our business.
Many advertisers continue to devote a substantial portion of their advertising budgets to advertising in traditional media or on other digital platforms, such as traditional TV, radio, print publications, and social media. The future growth of our business depends on the growth of advertising on TV streaming platforms and on advertisers increasing their spending on advertising on our streaming platform. Although traditional TV advertisers have shown growing interest in advertising on TV streaming platforms, we cannot be certain that their interest will continue to increase or that they will not revert to traditional TV advertising or shift their advertising spending to social media and other digital platforms (rather than to us). In addition, if we are unable to compete with social media and other digital platforms to win business from advertisers and advertising agencies who have traditionally advertised on these platforms, such as direct-to-consumer and small or medium-sized businesses, our ability to grow our business may be limited. If advertisers, or their agency relationships, do not perceive meaningful benefits of advertising on streaming TV platforms, the market may develop more slowly than we expect, which could adversely impact our operating results and our ability to grow our business.
Finally, there is political or regulatory pressure in some countries to limit streaming TV advertising (including limiting the advertising that may be associated with children’s content) or impose local content requirements on streaming TV services, which could pose a threat to our services.
We may not be successful in our efforts to further monetize our streaming platform, which may harm our business.*
Our business model depends on our ability to generate platform revenue from advertisers and content partners through ad-supported content and native display ads. We generate platform revenue primarily from the sale of digital advertising (including direct and programmatic video advertising, media and entertainment promotional spending, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls). As such, we are seeking to expand the number of Streaming Households and increase Streaming Hours in an effort to create additional platform revenue opportunities. As our user base grows and as we increase the amount of content offered and streamed across our platform, we must effectively monetize our expanding user base and streaming activity. The total number of Streaming Hours, however, does not correlate with platform revenue on a period-by-period basis, primarily because we do not monetize every hour streamed or every user on our platform. Moreover, Streaming Hours on our platform are measured whenever a Roku streaming device is streaming content, whether a viewer is actively watching or not. For example, if a player is connected to a TV, and the viewer turns off the TV, steps away, or falls asleep and does not stop or pause the player, then the particular streaming app may continue to play content for a period of time determined by the streaming app (although all Roku devices include a Roku OS feature that is designed to identify when content has been continuously streaming on an app for an extended period of time without user interaction, which periodically prompts the user to confirm that they are still watching the selected app and closes the app if the user does not respond affirmatively).
Our ability to deliver advertisements relevant to our users and to increase our streaming platform’s value to advertisers and content partners depends on the collection of user engagement data, which may be restricted or prevented by a number of factors, including the evolving data protection legal landscape. Users may decide to opt out or restrict our ability to collect viewing data or to provide them with more relevant advertisements. Content partners may also refuse to allow us to collect data regarding user engagement or refuse to implement mechanisms we request to ensure compliance with our legal obligations or technical requirements. For example, we are not able to fully utilize program level viewing data from many of our most popular apps to improve the relevancy of advertisements provided to our users.
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Other apps available on our streaming platform, such as Amazon Prime Video, Apple TV+, Hulu, and YouTube, are focused on increasing user engagement and time spent within their apps by allowing users to purchase additional content and streaming services within their apps; when users purchase these additional services within these apps, we may earn less revenue than when the services are purchased directly from us. If our users spend most of their time within particular apps where we have limited or no ability to place advertisements or leverage user information, or our users opt out from our ability to collect data for use in providing more relevant advertisements, we may not be able to achieve our expected growth in platform revenue, gross profit, or key performance metrics. Additionally, our distribution agreements with our most popular apps are renegotiated periodically; thus, even if we are currently able to monetize Streaming Hours within an app, we may not be able to do so in the future. If we are unable to further monetize our streaming platform, our business may be harmed.
Our efforts to monetize our streaming platform may not continue to grow as we expect, and our platform revenue growth has been, and may continue to be, lower than expected due to advertising inventory supply and demand imbalances, advertisers significantly curtailing or pausing advertising spending due to inflationary pressures, recessionary fears, or other reasons that are out of our control, or competitive pressures from video ad offerings on other TV streaming platforms or services. In addition, advertisers’ spending commitments, such as those we obtain in connection with annual TV Upfront presentations, are typically not fully binding, and the revenue we receive from such commitments may be less than the initially committed amount. This means that in order to materially increase the monetization of our streaming platform through the sale of video advertising, we will need to attract significantly more advertising dollars to our streaming platform as well as deliver ad-supported content that results in our users streaming significantly more ad-supported content. Accordingly, there can be no assurance that we will be successful in monetizing our streaming platform through the distribution of ad-supported content.
If we are not successful in working with third-party demand sources or in running our demand-side platform (“DSP”), our business may be harmed.*
Advertisers and advertising agencies can programmatically purchase and manage their streaming TV, desktop, and mobile advertising campaigns both off and on the Roku platform through third-party demand sources (such as third-party DSPs and supply-side platforms (“SSPs”)) and OneView (our proprietary DSP). The market for programmatic streaming TV ad buying is an evolving market, and our current and potential advertisers and advertising agencies may not continue to shift to programmatic ad buying from other buying methods as quickly as we expect or at all. If the market for programmatic streaming TV ad buying deteriorates or develops more slowly than we expect, advertisers and advertising agencies may not use DSPs or SSPs, and our business could be harmed. If we are unable to expand our programmatic demand by maintaining and developing third-party demand relationships in a way that is competitive with other advertising platforms, our business could be harmed. In addition, if DSPs or SSPs do not have the functionality or services expected by advertisers or advertising agencies, they may take their advertising spend to a non-Roku platform. We also may not be able to adapt to changes or trends in programmatic streaming TV advertising, which would harm our ability to grow our advertising revenue and harm our business.
Our growth depends in part on our ability to develop, maintain, and expand relationships with our licensed Roku TV partners and manufacturing partners and, to a lesser extent, service operators.
We license the Roku OS and our smart TV reference designs to certain TV brand and manufacturing partners for the development, manufacture, and commercialization of licensed Roku TV models. We have developed, and intend to continue to develop and expand, relationships with these TV brand and manufacturing partners. We continue to invest in the growth and expansion of our Roku TV program both in the United States and international markets. For a number of years, the sale of Roku TV models by our licensed Roku TV partners has materially contributed to growth in our Streaming Households and Streaming Hours and supported our platform monetization efforts. This growth has primarily been driven by North America; however, our Roku TV licensing program has been expanded to certain international markets and has represented an increased share of new Streaming Households. We do not typically receive, nor do we typically expect to receive, license revenue from these arrangements, but we typically incur operating expenses in connection with establishing and supporting these commercial agreements.
The primary economic benefits that we derive from these license arrangements have been and will likely continue to be indirect, primarily from growing our Streaming Households, increasing Streaming Hours, and thereby enabling us to generate more streaming services distribution and advertising-related revenue on our platform. If these arrangements do not continue to result in increased Streaming Households and Streaming Hours, and if that growth does not in turn lead to successfully monetizing that increased user activity, our business may be harmed.
The loss of a relationship with a licensed Roku TV partner (including as a result of our launch of Roku-branded TVs that are designed, made, and sold by us) could harm our results of operations, damage our reputation, increase pricing and promotional pressures from other partners and retail distribution channels, increase our marketing costs, and result in the loss of revenue. If we are not successful in maintaining existing and creating new relationships with any of these third parties, or if we encounter technological, content licensing, or other impediments to these relationships, our ability to grow or maintain our business could be adversely impacted.
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We have also developed licensing relationships with certain service operators, primarily in international markets; however, this program has been decreasing in scale in recent years, and as a result we have shifted the focus of our international growth to the sale of Roku streaming devices and expanding our Roku TV licensing program. Based on the decreasing scale of our licensing program for service operators, including termination of these relationships, we expect that the number of Streaming Households generated from this program will continue to decline, which may impact the overall growth rate of our Streaming Households in international markets.
Our Roku TV licensing arrangements are complex and time-consuming to negotiate and complete. Our current and potential partners include TV brands, retailers, cable and satellite companies, and telecommunication providers. Under these license arrangements, we generally have limited or no control over the amount and timing of resources these entities dedicate to the relationship. In the past, our licensed Roku TV partners have failed to meet their forecasts and anticipated market launch dates for distributing Roku TV models, and they may fail to meet their forecasts or such launches in the future. If our licensed Roku TV partners or service operator partners fail to meet their forecasts or such launches for distributing licensed streaming devices or choose to deploy competing streaming solutions within their product lines, our business may be harmed.
We depend on a small number of content partners for a majority of our Streaming Hours, and if we fail to maintain these relationships, our business could be harmed.*
Historically, a small number of content partners have accounted for a significant portion of the hours streamed on our platform. In the three months ended September 30, 2024, the top three streaming services (excluding The Roku Channel) represented over 50% of all hours streamed in the period. If, for any reason, we cease distributing apps that have historically streamed a large percentage of the aggregate Streaming Hours on our platform, our Streaming Hours, our Streaming Households, or Roku streaming device sales may be adversely affected, and our business may be harmed.
If popular or new content publishers do not publish content on our streaming platform, we may fail to retain existing users and attract new users.*
We must continuously maintain existing relationships and identify and establish new relationships with content publishers to provide popular streaming apps, streaming app features, and content. In order to remain competitive, we must consistently meet user demand for popular streaming apps, streaming app features, and content, particularly as we launch new streaming devices, introduce new TVs powered by the Roku OS, or enter new markets, including international markets. This may be challenging as the industry continues to evolve, including through consolidation of content publishers, joint ventures among content publishers, and licensing of content between content publishers. If we are not successful in helping our content publishers launch and maintain streaming apps and streaming app features that attract and retain a significant number of users on our streaming platform or if we are not able to do so in a cost-effective manner, our business will be harmed. Our ability to successfully help content publishers maintain and expand their app offerings on a cost-effective basis largely depends on our ability to:
•effectively promote and market new and existing streaming apps;
•minimize launch delays of new and updated streaming apps; and
•minimize streaming platform downtime and other technical difficulties.
In addition, if service operators, including traditional TV providers, refuse to grant our users access to stream certain apps or only make content available on devices they prefer, our ability to offer a broad selection of popular streaming apps or content may be limited. If we fail to help our content publishers maintain and expand their audiences on our streaming platform or their apps are not available on our streaming platform, our business may be harmed.
The non-renewal or early termination of agreements with our content partners may result in the removal of certain apps or app features from our streaming platform and may harm our streaming device sales, Streaming Household growth, and engagement.
We enter into agreements with all our content partners, which have varying terms and conditions, including expiration dates and rights to terminate under certain circumstances. Our agreements with content partners generally have terms of one to three years and can be terminated before the end of the term by the content partner under certain circumstances, including if we materially breach the agreement, become insolvent, enter bankruptcy, commit fraud, or fail to adhere to the content partners’ security or other platform certification requirements.
Upon expiration of these agreements, we are required to re-negotiate and renew them in order to continue providing content from these content partners on our streaming platform. We have in the past been unable, and in the future may not be able, to reach a satisfactory agreement with certain content partners before our existing agreements have expired. If we are unable to renew such agreements on a timely basis on mutually agreeable terms, or if a content partner terminates an agreement with us prior to its expiration, we may be required to temporarily or permanently remove certain apps or app features from our streaming platform.
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The loss of such apps or app features from our streaming platform for any period of time may harm our business. More broadly, if we fail to maintain our relationships with the content partners on terms favorable to us, or at all, or if these content partners face problems in delivering their content across our streaming platform, we may lose app partners or users and our streaming device sales, Streaming Household growth, and engagement may be harmed.
If we are unable to maintain an adequate supply of quality video ad inventory on our streaming platform or generate sufficient demand to effectively sell our available video ad inventory, our business may be harmed.*
Our business model depends on our ability to grow video ad inventory on our streaming platform and sell it to advertisers. While The Roku Channel has historically served as a valuable source of video ad inventory for us to sell, there is no guarantee that it will continue to do so in the future. If The Roku Channel is unable to secure content that is appealing to our users and advertisers, or is unable to do so on terms that provide a sufficient supply of ad inventory at reasonable cost, our supply of video ad inventory will be negatively impacted. We are also dependent on our ability to monetize video ad inventory within other ad-supported apps on our streaming platform. We seek to obtain the ability to sell such inventory from the content partners of such apps. We may fail to attract content partners that generate a sufficient quantity or quality of ad-supported content hours on our streaming platform or fail to obtain access to a sufficient quantity and quality of ad inventory from the publishers of such content. Our access to video ad inventory in ad-supported streaming apps on our streaming platform varies greatly among apps. Accordingly, we may not have access to a significant portion of the video ad inventory on our streaming platform. For certain apps, including YouTube’s ad-supported app, we have no access to video ad inventory at this time and we may not secure access in the future. Moreover, when existing SVOD services introduce new ad-supported tiers to their streaming services, we have in the past and in the future may not be able to reach agreement on access to video ad inventory on these tiers on mutually agreeable terms, or at all. The amount, quality, and cost of video ad inventory available to us can change at any time. If we are unable to grow and maintain a sufficient supply of quality video ad inventory at reasonable costs to keep up with demand, our business may be harmed. Further, even if we have an adequate supply of quality video ad inventory, we may not be able to generate sufficient demand for such ad inventory or sell the ad inventory at our desired price. If we are unable to effectively sell our available video ad inventory, our business may be harmed.
If our content partners do not participate in new features that we may introduce from time to time, our business may be harmed.*
As our streaming platform and products evolve, we will continue to introduce new features, which may or may not be attractive to our content partners or meet their requirements. For example, some content partners have elected not to participate in new Roku Home Screen Menu features or in our Roku Zones (collections of related content from apps across our streaming platform) or have imposed limits on our data gathering for usage within their apps. In addition, our streaming platform utilizes our proprietary Brightscript scripting language in order to allow our content partners to develop and create apps on our streaming platform. Certain content partners may find other languages, such as HTML5, more attractive to develop for and shift their resources to developing their apps on other platforms. If key content partners do not find our streaming platform simple and attractive to develop apps for, do not value and participate in all of the features and functionality that our streaming platform offers, or determine that our software developer kit or new features of our platform do not meet their requirements, our business may be harmed.
If the advertising campaigns on our streaming platform decrease, or the campaigns that run are not relevant or not engaging to our users, our business may be adversely impacted.*
We have made, and are continuing to make, investments to engage with more advertisers and content partners, and enable them to deliver more relevant advertising campaigns to our viewers. However, a small number of content partners historically have accounted for a significant portion of the media and entertainment promotional spending campaigns on our streaming platform, and consolidation among content partners has in the past resulted, and may in the future result, in decreased media and entertainment promotional spending campaigns on our streaming platform. If our content partners decrease the media and entertainment promotional spending campaigns on our streaming platform, our financial condition and operating results may suffer, and our business may be harmed.
In addition, existing and prospective advertisers may not be successful in serving advertising campaigns that lead to and maintain viewer engagement. Those ads and campaigns may seem irrelevant, repetitive, or overly targeted and intrusive. For example, viewers may dislike the content and frequency of advertising that appears on the Roku Home Screen. We are continuously seeking to balance the objectives of our advertisers with our desire to provide an optimal viewer experience, but we may not be successful in achieving a balance that continues to attract and retain viewers, advertisers, and content partners.
If the advertising campaigns on our streaming platform are not relevant, are overly intrusive, or are too frequent and impede the use of our platform, our viewers may stop using our platform, resulting in a reduction of our Streaming Households and Streaming Hours, which will harm our business, financial condition and operating results.
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We are subject to various risks in connection with our operation and monetization of The Roku Channel.*
We operate The Roku Channel, which offers ad-supported free access for users to a collection of films, television series, live linear television, and other content. We have incurred, and will continue to incur, costs and expenses in connection with the development, expansion, and operation of The Roku Channel, which we monetize primarily through advertising. We also commission original content that we own and distribute on The Roku Channel. From time to time, we may remove underperforming content from The Roku Channel and record an impairment charge related to such removal, as we did in fiscal year 2023 and during the three months ended June 30, 2024.
If our users do not continue to stream the ad-supported content we make available on The Roku Channel, we will not have the opportunity to monetize The Roku Channel through revenue generated from advertising. In order to attract users to the ad-supported content on The Roku Channel and drive streaming of ad-supported video on The Roku Channel, we must secure rights to stream content that is appealing to our users and advertisers. In part, we do this by directly licensing certain content from content owners, such as television and movie studios. The agreements that we enter into with these content owners have varying terms and provide us with rights to make specific content available through The Roku Channel during certain periods of time. Upon expiration of these agreements, we are required to re-negotiate and renew these agreements with the content owners, or enter into new agreements with other content owners, in order to obtain rights to distribute additional titles or to extend the duration of the rights previously granted. If we are unable to enter into content license agreements on acceptable terms to access content that enables us to attract and retain users of the ad-supported content on The Roku Channel, or if the content we do secure rights to stream is ultimately not appealing to our users and advertisers, usage of The Roku Channel may decline, and our business may be harmed. Further, even if we successfully monetize The Roku Channel in the United States, we may not be successful in monetizing The Roku Channel in international markets.
In addition, we produce content for distribution on The Roku Channel and other platforms. We have limited experience producing content, and we may not be successful in doing so in a cost-effective manner that is appealing to our users and advertisers and furthers the growth of The Roku Channel. We also take on risks associated with content production, such as completion and key talent risk. Furthermore, if the advertisements on The Roku Channel are not relevant to our users or such advertisements are overly intrusive and impede our users’ enjoyment of the available content, our users may not stream content and view advertisements on The Roku Channel, and The Roku Channel may not generate sufficient revenue from advertising to be cost effective for us to operate. In addition, we distribute The Roku Channel on platforms other than our own streaming platform, and there can be no assurance that we will be successful in attracting a large number of users or generating significant revenue from advertising through the distribution of The Roku Channel on such other streaming platforms.
If our users sign up for offerings and services outside of our streaming platform or through other apps on our streaming platform, our business may be harmed.
We earn revenue by acquiring subscribers for certain of our content partners activated on or through our streaming platform, including Premium Subscriptions on The Roku Channel, which allow our users to pay for content from various content partners. If users reduce the degree to which they use our streaming platform for these purchases or subscriptions for any reason, and instead increase the degree to which they pay for services directly with content partners or by other means for which we do not receive attribution, our business may be harmed.
In addition, certain apps available on our streaming platform allow users to purchase additional streaming services from within those apps. The revenue we earn from these transactions is not always equivalent to the revenue we earn from sales of such additional services on a stand-alone basis through our streaming platform. If users increase their spending on such in-app transactions at the expense of stand-alone purchases through our streaming platform, our business may be harmed.
We and our licensed Roku TV partners depend on retail sales channels to effectively market and sell our respective products, and if we or our partners fail to maintain and expand effective retail sales channels, we or our partners could experience lower product sales.*
To continue to grow our Streaming Households, we must maintain and expand retail sales channels for our products and for the Roku products sold by our partners or licensees. The majority of our products and our licensed Roku TV partners’ products are sold through traditional brick and mortar retailers, such as Best Buy, Costco, Target, and Walmart, including their online sales platforms, and online retailers such as Amazon.
We also sell certain products directly through our website and internationally through distributors and retailers such as Coppel in Mexico, Magazine Luiza in Brazil, MediaMarkt in Germany, and Currys in the United Kingdom. As we have only recently expanded to certain international markets, we may not have established a strong reputation or relationships with retailers for those markets as compared to our retail sales channels in the United States or our competitors in international markets.
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Our retailers and distributors also sell products that compete with our products and our licensed Roku TV partners’ products, including house-branded televisions sold by such retailers that utilize TV operating systems other than the Roku OS. We have no minimum purchase commitments or long-term contracts with any of these retailers or distributors, and there can be no assurance that we will reach agreements with our retailers and distributors on terms we find acceptable or that will be consistent with our past practices. We may be reliant on certain retailers or distributors. Amazon, Best Buy, Target, and Walmart in total accounted for 78% of our devices revenue for both the three months ended September 30, 2024 and September 30, 2023. Furthermore, our licensed Roku TV partners may be reliant on the same retailers and distributors or other retailers and distributors for a significant portion of their unit sales of Roku TV models. If one or several retailers or distributors were to discontinue selling our products or our licensed Roku TV partners’ products, choose not to prominently display those products in their stores or on their websites, or close or severely limit access to their brick and mortar locations, the volume of our products or our licensed Roku TV partners’ products sold could decrease, which would harm our business. These risks may be exacerbated by our reliance on certain retailers or distributors, or when a major retailer in a jurisdiction commercializes televisions under brands that the retailer controls.
In addition, if any of our existing licensed Roku TV partners choose to work exclusively with, or divert a significant portion of their business with us to, other operating system developers, this may adversely impact our ability to continue to license the Roku OS and our smart TV reference design to TV brands and to grow Streaming Households and monetize the Roku OS. Traditional retailers have limited shelf and end cap space in their stores and limited promotional budgets, and online retailers have limited prime website product placement space. Competition is intense for these resources, and a competitor with more extensive product lines, stronger brand identity and greater marketing resources, such as Amazon or Google, possesses greater bargaining power with retailers. In addition, one of our online retailers, Amazon, sells its own competitive streaming devices, smart TVs, and smart home devices, is able to market and promote these products more prominently on its website, and could refuse to offer or promote our products on its website. If Walmart’s pending acquisition of Vizio is consummated, we may face increased competition within Walmart, which currently makes and sells Onn. branded streaming products, including co-branded Roku TV models. Any reduction in our ability to place and promote our products, or increased competition for available shelf or website placement, could require us to increase our marketing or other expenditures to maintain our product visibility or could result in reduced visibility for our products, which may harm our business. In particular, the availability of product placement during peak retail periods, such as the holiday season, is critical to our revenue growth, and if we are unable to effectively sell our products during these periods, our business would be harmed.
If our efforts to build a strong brand and maintain customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed.
Building and maintaining a strong brand is important to attract and retain users, as potential users have a number of TV streaming choices. Successfully building a brand is a time-consuming and comprehensive endeavor, and our brand may be negatively impacted by factors that are out of our control, such as the quality and reliability of the Roku TV models made by our licensed Roku TV partners and the quality of the content that our content partners provide. Our competitors may be able to achieve and maintain brand awareness and consumer demand for their products more quickly and effectively than we can. Many of our competitors are larger companies and may have greater resources to devote to the promotion of their brands through traditional advertising, digital advertising, or website product placement. If we are unable to execute on building a strong brand, it may be difficult to differentiate our business and streaming platform from our competitors in the marketplace, which may adversely affect our ability to attract and retain users and harm our business.
Our streaming platform allows our users to choose from a wide variety of apps, representing a variety of content from a wide range of content partners. Our users can choose and control which apps they download and watch, and they can use certain settings to prevent apps from being downloaded to Roku streaming devices. While we have policies that prohibit the publication of content that is unlawful, incites illegal activities, or violates third-party rights, among other things, we may distribute apps that include controversial content. Controversies related to the content included on certain apps that we distribute have resulted in, and could in the future result in, negative publicity, cause harm to our reputation and brand, or subject us to claims and may harm our business.
We are subject to payment-related risks and, if our advertisers, advertising agencies, or programmatic partners do not pay or dispute their invoices, our business may be harmed.*
Many of our contracts with advertising agencies provide that if the advertiser does not pay the agency, the agency is not liable to us, and we must seek payment solely from the advertiser, a type of arrangement called sequential liability. Contracting with these agencies, which in some cases have or may develop higher-risk credit profiles, may subject us to greater credit risk than if we were to contract directly with advertisers.
This credit risk may vary depending on the nature of an advertising agency’s aggregated advertiser base. In addition, typically, we are contractually required to pay advertising inventory data suppliers within a negotiated period of time, regardless of whether our advertisers or advertising agencies pay us on time, or at all. Further, we typically experience slow payment cycles by advertising agencies as is common in the advertising industry. While we attempt to balance payment periods with our suppliers and advertisers and advertising agencies, we are not always successful. As a result, we can often face a timing issue with our accounts payable on shorter cycles than our accounts receivables, requiring us to remit payments from our own funds, and accept the risk of credit losses.
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We may also be involved in disputes with agencies, their advertisers, or our programmatic partners over the operation of our streaming platform, the terms of our agreements, or our billings for purchases made by them through our streaming platform, our DSP, or other programmatic partners. If we are unable to collect or make adjustments to bills, we could incur credit losses, which could have a material adverse effect on our results of operations for the periods in which the write-offs occur. In the future, bad debt may exceed reserves for such contingencies, and our bad debt exposure may increase over time. Any increase in write-offs for bad debt could have a materially negative effect on our business, financial condition, and operating results. If we are not paid by our advertisers or advertising agencies on time or at all, our business may be harmed.
The quality of our customer support is important, and if we fail to provide adequate levels of customer support, we could lose users, advertisers, content partners, and licensed Roku TV partners, which could harm our business.
Our users depend on our customer support organization to resolve issues relating to our products and our streaming platform. A high level of support is critical for the success of our business. We currently outsource the majority of our customer support operation to a third-party customer support organization which provides support to end users. In addition, we train our licensed Roku TV partners and service operator licensees to provide first-level customer support to users of Roku TV models and other devices. If we do not effectively train, update, and manage our third-party customer support organization to assist our users and licensees, and if that support organization does not succeed in helping them quickly resolve issues or provide effective ongoing support, it could adversely affect our ability to monetize our streaming platform, to sell our products to users and could harm our reputation with potential new customers and our licensees.
We must continue to innovate and develop new and existing products and services to remain competitive, and new products and services expose our business to new risks.*
We must continually innovate and improve our products and services and develop new products and services to meet changing consumer demands. The introduction of a new product or service is a complex task, involving significant expenditures in research and development, promotion, and sales channel development, and can expose our business to new risks. The introduction of new products and services or changes to our existing products and services may result in new or enhanced governmental or regulatory scrutiny, new litigation or claims, or other complications that could adversely affect our business, reputation, or financial results. In addition, our entrance into entirely new lines of business beyond our historical core business of TV streaming and advertising, such as our Roku-branded smart home products, may change our risk profile and subject us to risks that differ from the risks we face as a result of our historical TV streaming business.
Whether users will broadly adopt our new products or services is not certain. Our future success will depend on our ability to develop new and competitively priced products and services and add new desirable content and features to our streaming platform. Moreover, we must introduce new products and services in a timely and cost-effective manner, and we must secure production orders for new products from our contract manufacturers. The development of new products and services is a highly complex process, and we do not expect that all of our projects will be successful.
The successful development and introduction of new products and services depends on a number of factors, including:
•the accuracy of our forecasts for market requirements beyond near-term visibility;
•our ability to anticipate and react to new technologies and evolving consumer trends;
•our development, licensing, or acquisition of new technologies;
•our timely completion of new designs and development;
•our ability to timely and adequately redesign or resolve design or manufacturing or security issues;
•our ability to identify and contract with an appropriate manufacturer;
•the ability of our contract manufacturers to cost-effectively manufacture our new products;
•the availability of materials and key components used in manufacturing;
•tariffs, trade, sanctions, and export restrictions by the U.S. or foreign governments;
•the ability of our contract manufacturers to produce quality products and minimize defects, manufacturing mishaps, shipping costs, and delays;
•our ability to obtain required licenses and comply with other regulatory requirements; and
•our ability to attract and retain world-class research and development personnel.
If any of these or other factors materializes, we may not be able to develop and introduce new products or services in a timely or cost-effective manner, and our business may be harmed.
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We do not have our own manufacturing capabilities and primarily depend upon a limited number of contract manufacturers, and our operations could be disrupted if we encounter problems with our contract manufacturers.*
We do not have any internal manufacturing capabilities and rely on a limited number of contract manufacturers to build our players, smart home products, and Roku-branded TVs. Our contract manufacturers are vulnerable to, among other issues:
•capacity constraints;
•reduced component availability;
•production, supply chain, or shipping disruptions, delays, or increased costs, including from labor disputes, strikes, mechanical issues, quality control issues, natural disasters, geopolitical conflicts, and public health crises; and
•the impact of U.S. or foreign tariffs, trade, or sanctions restrictions on components, finished goods, software, other products, or data transfers.
As a result, we have limited control over delivery schedules, manufacturing yields, and costs, particularly when components are in short supply or when we introduce new products.
We also have limited control over our contract manufacturers’ quality systems and controls, and therefore must rely on them to manufacture our products to our quality and performance standards and specifications. Delays, component shortages, quality issues, and other manufacturing and supply problems in the past have impaired, and could in the future impair, the retail distribution of our products and ultimately our brand. Furthermore, any adverse change in our contract manufacturers’ financial or business condition could disrupt our ability to supply our products to our retailers and distributors.
We also rely upon our contract manufacturers and other contractors to perform some of the development work on our products. The contract manufacturers or other contractors may be unwilling or unable to successfully complete desired development or fix defects or errors in a timely manner. Delays in development work by contract manufacturers or contractors could delay launch of new or improved products.
Our contracts with our contract manufacturers generally may not contain terms that protect us against development, manufacturing, and supply disruptions or risks. For example, such contracts may not obligate our contract manufacturers to supply our products in any specific quantity or at any specific price. If our contract manufacturers are unable to fulfill our production requirements in a timely manner, if their costs increase because of inflationary pressures, U.S. or international tariffs, sanctions, export or import restrictions, or if they decide to terminate their relationship with us, our order fulfillment may be delayed or terminated, and we would have to attempt to identify, select, and qualify acceptable alternative contract manufacturers.
Alternative contract manufacturers may not be available to us when needed or may not be in a position to satisfy our production requirements at commercially reasonable prices, to our quality and performance standards on a timely basis, or at all. Any significant interruption in manufacturing at our contract manufacturers for any reason could require us to reduce our supply of products to our retailers and distributors, which in turn would reduce our revenue, or incur higher freight costs than anticipated, which would negatively impact our devices gross margin.
In addition, our contract manufacturers’ facilities, and the facilities of our contract manufacturers’ suppliers, are located in various geographic areas that may be subject to political, economic, labor, trade, public health, social, and legal uncertainties, including Taiwan, Vietnam, China, and Brazil, and such uncertainties may harm or disrupt our relationships with these parties or their ability to perform. For example, if the tensions between Taiwan and China escalate and impact the operations of our contract manufacturers and their Taiwanese suppliers, our supply chain and our business could be adversely affected. We believe that the international location of these facilities increases supply risk, including the risk of supply interruptions, tariffs, and trade restrictions on exports or imports.
The supply of Roku TV models to the market could be disrupted if our licensed Roku TV partners encounter problems with their internal operations or with their contract manufacturers, assemblers, or component suppliers.*
Some of our licensed Roku TV partners have internal manufacturing capabilities, while others rely primarily or exclusively upon contract manufacturers to build the Roku TV models that our licensed Roku TV partners sell to retailers. Regardless of whether their manufacturing capabilities are internal or contracted, our licensed Roku TV partners’ manufacturers may be vulnerable to capacity constraints and reduced component availability; increases in tariffs on imports of Roku TV models; future possible changes in regulations on exports; restrictions, by the United States or otherwise, on dealings with certain countries, companies, or imported inputs; tariffs on parts or components for Roku TV models; and supply chain disruptions, increased shipping costs, and shipping delays.
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Our licensed Roku TV partners’ control over delivery schedules, manufacturing yields, and costs, particularly when components are in short supply, may be limited. For those licensed Roku TV partners with contract manufacturers or suppliers, the problems are exacerbated because the contract manufacturer is a third party, and the licensed Roku TV partner does not have direct visibility into or control over the operations. Delays, component shortages, and other manufacturing and supply problems could impair the manufacture or distribution of Roku TV models. Interruptions in the supply of Roku TV models to retailers and distributors or increases in the pricing of Roku TV models at times have negatively affected, and could adversely affect in the future, the volume of Roku TV models sold at retail, resulting in slower Streaming Households and Streaming Hours growth.
Furthermore, any manufacturing, design, or other issues affecting the quality or performance of Roku TV models could harm our brand and our business.
If we fail to accurately forecast our manufacturing requirements for our products and manage our inventory with our contract manufacturers, we could incur additional costs, experience manufacturing delays, and lose revenue.
We bear risks of excess and insufficient inventories under our contract manufacturing arrangements. For example, our contract manufacturers order materials and components in advance in an effort to meet our projected needs for our products. Lead times for the materials and components that our contract manufacturers order on our behalf through different component suppliers may vary significantly and depend on numerous factors outside of our control, including the specific supplier, contract terms, shipping and freight, market demand for a component at a given time, and trade and government relations. Lead times for certain key materials and components incorporated into our products are currently lengthy and may require our contract manufacturers to order materials and components many months in advance. If we overestimate our production requirements, our contract manufacturers may purchase excess components and build excess inventory. If our contract manufacturers, at our request, purchase excess components or build excess products, we could be required to pay for these excess components or products. In the past, we have agreed to reimburse our contract manufacturers for purchased components that were not used as a result of our decision to discontinue a certain model or the use of particular components. If we incur costs to cover excess supply commitments, our business may be harmed.
Conversely, if we underestimate our product requirements, our contract manufacturers may have inadequate material or component inventory, which could interrupt the manufacturing of our products, result in insufficient quantities available to meet demand, and result in delays or cancellation of orders from retailers and distributors. In addition, from time to time we have experienced unanticipated increases in demand that resulted in the need to ship our products via air freight, which is more expensive than ocean freight, and adversely affected our devices gross margin during such periods of high demand (for example, during end-of-year holidays). If we fail to accurately forecast our manufacturing requirements, our business may be harmed.
Our products incorporate key components from sole source suppliers, and if our contract manufacturers are unable to obtain sufficient quantities of these components on a timely basis, we will not be able to deliver our products to our retailers and distributors.
We depend on sole source suppliers for key components in our products. For example, each of our streaming players and TVs powered by the Roku OS may utilize a specific system on chip (or SoC), Wi-Fi silicon product, and Wi-Fi front-end module, each of which may be available from only a single manufacturer and for which we do not have a second source.
Although this approach allows us to maximize product performance on lower cost hardware, reduce engineering development and qualification costs, and develop stronger relationships with our strategic suppliers, this also creates supply chain risk. These sole-source suppliers could be constrained by fabrication capacity issues or material supply issues, such as U.S. or foreign tariffs, war or other government or trade relations issues, other export or import restrictions on parts or components for finished products that are used in final assembly of their components (or on the finished products themselves), or shortages of key components.
There is also a risk that the strategic supplier may stop producing such components, cease operations, be acquired by or enter into exclusive arrangements with our competitors or other companies, put contract manufacturers on allocation because of semiconductor shortages, or become subject to U.S. or foreign sanctions or export control restrictions or penalties. Such suppliers have experienced, and may in the future experience, production, shipping, or logistical constraints arising from macroeconomic conditions or other circumstances, such as inflationary pressures, geopolitical conflict, and supply chain disruptions. Such interruptions and delays have in the past and may in the future force us to seek similar components from alternative sources, which may not always be available, and which may cause us to delay product introductions and incur air freight expense. Switching from a sole-source supplier may require that we adapt our software and redesign our products to accommodate new chips and components, and may require us to re-qualify our products with regulatory bodies, such as the U.S. Federal Communications Commission (“FCC”), which would be costly and time-consuming.
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Our reliance on sole-source suppliers involves a number of additional risks, including risks related to:
•supplier capacity constraints;
•price increases, including those related to inflationary pressures, tariffs, and material costs;
•timely delivery;
•component quality; and
•delays in, or the inability to execute on, a supplier roadmap for components and technologies.
Any interruption in the supply of sole-source components for our products could adversely affect our ability to meet scheduled product deliveries to our retailers and distributors, result in lost sales and higher expenses, and harm our business.
If our products do not operate effectively with various offerings, technologies, and systems from content partners and other third parties that we do not control, our business may be harmed.*
The Roku OS is designed to perform using relatively low-cost hardware, which enables us to drive user growth via Roku streaming devices offered at a low cost to users. However, this hardware must be interoperable with all apps and other offerings, technologies, and systems from our content partners, including virtual multi-channel video programming distributors, and other third parties. We have no control over these offerings, technologies, and systems beyond our app certification requirements, and if Roku streaming devices do not provide our users with a high-quality experience on those offerings on a cost-effective basis or if changes are made to those offerings that are not compatible with Roku streaming devices, we may be unable to increase Streaming Household growth and user engagement or may be required to increase our hardware costs, and our business will be harmed.
We plan to continue to introduce new products regularly, including, for example, the Roku-branded TVs we launched in 2023 and the Roku Pro Series TVs launched in April 2024, and we have experienced that it takes time to optimize such products to function well with these offerings, technologies and systems. In addition, many of our largest content partners have the right to test and certify our new products before we can publish their apps. The certification processes can be time-consuming and introduce third-party dependencies into our product release cycles. If our content partners do not certify new products on a timely basis or require us to make changes in order to obtain certifications, our product release plans may be adversely impacted, we may not be able to offer certain products to all licensed Roku TV partners or we may not continue to offer certain apps. To continue to grow our Streaming Households and user engagement, we will need to prioritize development of Roku streaming devices to work better with new offerings, technologies, and systems, including our smart home products and services. If we are unable to maintain consistent operability of Roku streaming devices that is on parity with or better than other platforms, our business could be harmed.
In addition, any future changes to offerings, technologies, and systems from our content partners may impact the accessibility, speed, functionality, and other performance aspects of Roku streaming devices. We may not successfully develop Roku streaming devices that operate effectively with these offerings, technologies, or systems. If it becomes more difficult for our users to access and use these offerings, technologies, or systems, our business could be harmed.
Our products are complex and may contain hardware defects and software errors, which could manifest themselves in ways that could harm our reputation and our business.*
Our products and the products of our licensed Roku TV partners are complex and have contained and may in the future contain hardware defects or software errors. These defects and errors can manifest themselves in any number of ways in our products or our streaming platform, including through diminished performance, security vulnerabilities, data loss or poor quality, device malfunctions, account inactivity, or even permanently disabled products. Some errors may only be discovered after a product has been shipped and used by users and may in some cases only be detected under certain circumstances or after extended use. We update our software on a regular basis, and, despite our quality assurance processes, we could introduce software errors in the process of any such update.
The introduction of a serious software error could result in products becoming permanently disabled. We offer a limited warranty for our products, in accordance with applicable law, however, providing software updates, product support, and other activities could cause us to be responsible for issues with products for an extended period of time. Any defects discovered in our products after commercial release could result in loss of revenue or delay in revenue recognition, loss of customer goodwill and users, and increased service costs, any of which could harm our business, operating results, and financial condition. We could also face claims for product or information liability, tort or breach of warranty, or other violations of laws or regulations. In addition, our contracts with our end users contain provisions relating to warranty disclaimers and liability limitations, which may not be upheld. Defending a lawsuit, regardless of its merit, is costly and may divert management’s attention and adversely affect the market’s perception of Roku and our products. In addition, if our insurance coverage proves inadequate or future coverage is unavailable on acceptable terms or at all, our business could be harmed.
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Components used in our products may fail as a result of manufacturing, design, or other defects that were unknown to us or over which we have no control and may render our products permanently inoperable.
We rely on third-party component suppliers to provide certain functionalities needed for the operation and use of our products. Any errors or defects in such third-party technology could result in errors or defects in our products that could harm our business. If these components have a manufacturing, design, or other defect, they could cause our products to fail and could render them permanently inoperable. For example, the typical means by which our users connect their home networks to our players is by way of a Wi-Fi access point in the home network router. If the Wi-Fi receiver or transmitter in a player fails and cannot detect a home network’s Wi-Fi access point, the player will not be able to display or deliver any content to the TV screen. As a result, we may have to recall and replace defective products, which could be at a considerable cost and expense. Should we have a widespread problem of this kind, our reputation in the market could also be adversely affected.
If we are unable to obtain or maintain necessary or desirable licenses, certifications, or approvals related to our use or support of third-party technology, intellectual property, or services, then our ability to develop and introduce new products and services, and continue to manufacture, update, and commercialize existing products and services, may be impaired.*
We use or enable in our products and services certain industry standard and other technology, intellectual property, and services that are obtained from third parties. As a result, in order to continue to make, distribute, update, and commercialize our existing products and services, and introduce and commercialize new products and services, we may be required to maintain certain licenses, certifications, and approvals from the relevant third parties and potentially license and otherwise obtain access to additional technologies, intellectual property, and products from third parties. The licenses, certifications, and approvals we need to obtain from third parties may be or become unavailable to us on commercially reasonable terms, if at all. If we are unable to obtain or maintain necessary third-party licenses, certifications, or approvals, we may have to obtain substitute technologies, intellectual property, or services with lower quality or performance standards, or at a greater cost, or remove desired functions and features from our products and services, any of which could harm customer and partner relationships, as well as the competitiveness of our products, services, and business.
Our products and services are designed to be compatible with numerous industry standards. In many cases, these industry standards have numerous associated patents known generally as standard essential patents (“SEPs”). Over time, SEP owners have increasingly turned away from licensing their SEPs through patent pools, preferring to license their portfolios directly. This has increased the number of licensors (since the patents are not pooled) and increased the time, cost, and difficulty of SEP licensing. If we are unable to obtain a license to a necessary SEP on commercially reasonable terms, or at all, or find a suitable substitute technology that complies with the industry standard, our customer and partner relationships, as well as the competitiveness of our products and services, and our business may be harmed.
We are incorporating AI technologies into some of our products and services, which may present operational and reputational risks.*
We have incorporated and intend to continue to incorporate AI technologies, such as generative AI, into our products and services. For example, we have introduced a generative-driven ad creation service for our advertisers to help them create ads more easily, and we continue to use AI technologies to power our content recommendation engine. As with many innovations, AI presents risks and challenges that could adversely impact our business. AI technologies can create accuracy issues, unintended biases, and discriminatory outcomes, or may create content that appears correct but is inaccurate or flawed. If the recommendations, content, or analyses that AI applications produce are or are alleged to be deficient or inaccurate, we could be subjected to competitive harm, potential legal liability, and brand or reputational harm. The legal and regulatory landscape surrounding AI technologies is rapidly evolving and uncertain, including in the areas of intellectual property, cybersecurity, and privacy and data protection. For example, there is uncertainty around the validity and enforceability of intellectual property rights related to the use, development, and deployment of AI technologies. Compliance with new or changing laws, regulations or industry standards relating to AI may impose significant operational costs and may limit our ability to develop, deploy or use AI technologies. There can be no assurance that the measures we have taken to mitigate the potential risks related to generative AI will be sufficient. Failure to appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm.
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Risks Related to Operating and Growing Our Business
We have incurred operating losses in the past, and although we have achieved profitability in certain prior quarters, we may continue to incur operating losses in the future and may not be able to achieve profitability again in the near term or at all.*
We have incurred operating losses in the past, and we may incur operating losses in the future. Although we achieved profitability in certain prior quarters, we may not be able to achieve profitability again in the near term or at all. As of September 30, 2024, we had an accumulated deficit of $1,391.4 million. Our operating expenses have increased in the past and may increase again in the future as we expand our operations and invest in growth and new areas. If our revenue and gross profit do not grow at a greater rate than our operating expenses, we may not be able to achieve profitability again. We expect our profitability to fluctuate in the future for a number of reasons, including without limitation the other risks and uncertainties described herein. Additionally, we may encounter unforeseen operating or legal expenses, difficulties, complications, delays, and other factors that may result in losses in future periods.
Our quarterly operating results may be volatile and are difficult to predict, and our stock price may decline if we fail to meet the expectations of securities analysts or investors.*
Our revenue, gross profit, key performance metrics (including Streaming Households, Streaming Hours, ARPU, and Free Cash Flow), and other operating results could vary significantly from quarter-to-quarter and year-to-year and may fail to match our past performance due to a variety of factors, including many factors that are outside of our control. Factors that may contribute to the variability of our operating results and cause the market price of our Class A common stock to fluctuate include:
•the entrance of new competitors or competitive products or services, whether by established or new companies;
•our ability to retain and grow our Streaming Households, increase engagement among new and existing users, and monetize our streaming platform;
•our ability to maintain effective pricing practices in response to the competitive markets in which we operate or other macroeconomic factors, such as increased taxes or inflationary pressures, such as those the market is currently experiencing, and our ability to control costs, including our operating expenses;
•our revenue mix, which drives gross profit;
•supply of advertising inventory on our platform and advertiser demand for advertising inventory on our platform;
•seasonal, cyclical, or other shifts in revenue from advertising or product sales;
•the timing of the launch of new or updated products, apps, or features;
•the addition or removal of content or apps from our streaming platform;
•the expense and availability of content to license or produce for The Roku Channel;
•the ability of retailers to anticipate consumer demand;
•an increase in the manufacturing or component costs of our products or partner-branded products;
•delays in delivery of our products or partner-branded products, or disruptions in our or our partners’ supply or distribution chains; and
•an increase in legal costs, including costs associated with protecting our intellectual property, defending against third-party intellectual property infringement allegations, or procuring rights to third-party intellectual property.
Our gross margins vary across our devices and platform offerings. Our devices segment (which generates revenue from the sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories, as well as revenue from licensing arrangements with service operators) experienced negative gross margin for the three and nine months ended September 30, 2024, and our platform segment (which generates revenue from the sale of digital advertising (including direct and programmatic video advertising, media and entertainment promotional spending, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls)) experienced positive gross margin for the three and nine months ended September 30, 2024. Gross margins on our streaming devices vary across models and can change over time as a result of product transitions, pricing and configuration changes, component costs, device returns, and other cost fluctuations.
In addition, our gross margin and operating margin percentages, as well as overall profitability, may be adversely impacted as a result of a shift in device, geographic, or retail sales channel mix, component cost increases, price competition, or the introduction of new products, including those that have higher cost structures with flat or reduced pricing. We have in the past and may in the future strategically reduce our devices gross margin or record negative gross margin on devices in an effort to increase the number of Streaming Households and grow our gross profit.
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As a result, our devices segment revenue may not increase as rapidly as it has historically, or at all, and, unless we are able to continue to increase our platform segment revenue and grow the number of Streaming Households, we may be unable to grow gross profit and our business will be harmed. For example, from time to time, global supply chain disruptions have resulted in shipping delays, increased shipping costs, component shortages, and increases in component prices, which negatively affected our devices gross margin. If a reduction in gross margin does not result in an increase in our Streaming Households or an increase in our platform revenue and gross profit, our financial results may suffer, and our business may be harmed. In addition, our platform segment has experienced in the past, and may experience in the future, lower gross margins than we anticipate. If our platform gross margins are lower than we anticipate, our financial results may suffer, and our business may be harmed.
If we have difficulty managing our growth in operating expenses, our business could be harmed.*
We have experienced significant growth in our research and development, sales and marketing, support services, operations, and general and administrative functions in recent years and may continue to expand certain of these activities. Our historical growth has placed, and any future growth will continue to place, significant demands on our management, as well as our financial and operational resources, to:
•manage a larger organization;
•hire more employees, including engineers with relevant skills and experience;
•expand internationally;
•increase our sales and marketing efforts;
•expand the capacity to manufacture and distribute our products;
•broaden our customer support capabilities;
•expand our product offerings;
•support our licensed Roku TV partners and service operators;
•expand and improve the content offering on our streaming platform;
•implement appropriate operational and financial systems; and
•maintain effective financial disclosure controls and procedures.
If we fail to manage our growth effectively, including if we grow our business too rapidly, we may not be able to execute our business strategies, which could harm our business and adversely affect our financial condition, results of operations, or cash flows.
We have previously undertaken restructuring plans to adjust our investment priorities and manage our operating expenses, and we may do so again in the future. We have incurred, and may in the future incur, material costs and charges in connection with restructuring plans and initiatives, and there can be no assurance that any restructuring plans and initiatives will be successful. Any restructuring plans may adversely affect our internal programs and our ability to recruit and retain skilled and motivated personnel, may result in a loss of continuity, loss of accumulated knowledge, or inefficiency during transitional periods, may require a significant amount of employees’ time and focus, and may be distracting to employees, which may divert attention from operating and growing our business. For more information, see Note 16 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
If we fail to achieve some or all of the expected benefits of any restructuring plans or are unable to manage our growth and expansion plans effectively, which may be impacted by factors outside of our control, our business, operating results, and financial condition could be adversely affected.
We may be unable to successfully expand our international operations, and our international expansion plans, if implemented, will subject us to a variety of risks that may harm our business.*
We currently generate the vast majority of our revenue in the United States and have limited experience marketing, selling, licensing, and supporting our products and running or monetizing our streaming platform outside the United States. In addition, we have limited experience managing the administrative aspects of a global organization. While we intend to continue to explore opportunities to expand our business in international markets in which we see compelling opportunities, we may not be able to create or maintain international market demand for our products and streaming platform services. Moreover, we face intense competition in international markets, especially because some of our competitors have already successfully introduced their products into new markets we are entering and have greater experience managing a global organization.
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In the course of expanding our international operations, we are subject to a variety of risks that could adversely affect our business, including:
•differing legal and regulatory requirements in foreign jurisdictions, including country-specific laws and regulations pertaining to data privacy and data security, consumer protection, tax, telecommunications, trade (including tariffs, quotas, and sanctions), labor, environmental protection, censorship and other content restrictions, use of AI technologies, copyright and intellectual property, and local content and advertising requirements, among others;
•exposure to increased corruption risk and compliance with laws such as the U.S. Foreign Corrupt Practices Act, UK Bribery Act, and other anti-corruption laws, U.S. or foreign export controls and sanctions, and local laws prohibiting improper payments to government officials and requiring the maintenance of accurate books and records and a system of sufficient internal controls;
•slower consumer adoption and acceptance of streaming devices and services in other countries;
•different or unique competitive pressures as a result of, among other things, competition with other devices that consumers may use to stream TV or existing local traditional TV services and products, including those provided by incumbent TV service providers and local consumer electronics companies;
•greater difficulty supporting and localizing Roku streaming devices and our streaming platform, including delivering support and training documentation in languages other than English;
•our ability to deliver or provide access to popular streaming apps or content to users in certain international markets;
•availability of reliable broadband connectivity in areas targeted for expansion;
•challenges and costs associated with staffing and managing foreign operations;
•differing legal and court systems, including limited or unfavorable intellectual property protection;
•unstable political and economic conditions, social unrest, or economic instability, whatever the cause, including due to pandemics, natural disasters, wars, terrorist activity, foreign invasions (such as the Russian invasion of Ukraine and the current conflict in the Middle East), tariffs, trade disputes, local or global recessions, diplomatic or economic tensions (such as the tension between China and Taiwan), long-term environmental risks, or climate change;
•adverse tax consequences, such as those related to changes in tax laws (including increased tax rates, the imposition of digital services taxes, and the adoption of global corporate minimum taxes and anti-base-erosion rules), changes in the interpretation of existing tax laws, and the heightened scrutiny by tax administrators of companies that have cross-border business activities;
•the imposition of customs duties on cross-border data flows for streaming services, in the event that the World Trade Organization fails to extend the current moratorium on such duties;
•any pandemics or epidemics, which could result in decreased economic activity in certain markets, changes in the use of our products or platform, or decreased ability to import, export, ship, or sell our products to supply such services to existing or new customers in international markets;
•inflationary pressures, such as those the global market is currently experiencing, which may increase costs for materials, supplies, and services;
•fluctuations in currency exchange rates, which could impact the revenue and expenses of our international operations and expose us to foreign currency exchange rate risk (see the section titled “Foreign Currency Exchange Rate Risk” in Part I, Item 3 of this Quarterly Report for additional information);
•restrictions on the repatriation of earnings from certain jurisdictions; and
•working capital constraints.
In addition, we may face challenges in successfully deploying our business model in international markets. Three core areas of focus define our business model: first, we grow scale by increasing our Streaming Households; second, we grow engagement by increasing the hours of content streamed through our streaming platform; and third, we grow monetization of the activities that users engage in through our streaming platform. Even if we are able to increase our Streaming Households in international markets, we may be unable to effectively grow our Streaming Hours or monetize user activity in those markets. Further, as of September 30, 2024, our ARPU was lower in international markets than in the United States. If we invest substantial time and resources to expand our international operations and are unable to do so successfully and in a timely manner, our business and financial condition may be harmed.
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Our revenue and gross profit are subject to seasonality and other potential fluctuations, and if our sales during the affected periods fall below our expectations, our business may be harmed.*
Seasonality and certain one-time events significantly affect our business. For example, our revenue and gross profit are traditionally strongest in the fourth quarter of each fiscal year due to higher consumer purchases and increased advertising during holiday seasons. Furthermore, in preparation for the fourth quarter holiday season, we recognize significant discounts in the average selling prices of our products through retailers in an effort to grow our Streaming Households, which typically reduce our devices gross margin in the fourth quarter. Additionally, certain other events have in the past, and may in the future, impact the amount of advertising spending on our platform. For example, we have experienced increased demand for advertising time and placement for political advertisements in connection with the U.S. presidential election.
Given the seasonal and often irregular nature of advertising and our product sales, as well as other potential fluctuations, accurate forecasting is critical to our operations. We anticipate that such impact on revenue and gross profit is likely to continue, and any shortfall in expected fourth quarter revenue due to a decline in the effectiveness of our promotional activities, actions by our competitors, reductions in consumer discretionary spending, curtailed advertising spending, disruptions in our supply or distribution chains, tariffs or other restrictions on trade, increased shipping costs, shipping or air freight delays, or for any other reason, would cause our full year results of operations to suffer significantly. For example, macroeconomic uncertainties and inflationary pressures negatively affected consumer electronics sales during the holiday season in 2023. In addition, delays or disruptions at U.S. ports of entry have in the past, and may in the future, adversely affect our or our licensed Roku TV partners’ ability to timely deliver products to retailers during holiday seasons.
A substantial portion of our expenses are personnel-related (including salaries, stock-based compensation, and benefits) and facilities-related, none of which are seasonal in nature. Accordingly, in the event of a revenue shortfall, we would be unable to mitigate the negative impact on gross profit and operating margins, at least in the short term, and our business would be harmed.
If we fail to attract and retain key personnel, effectively manage succession, or hire, develop, and motivate our employees, we may not be able to execute our business strategy or continue to grow our business.
Our success depends in large part on our ability to attract and retain key personnel on our senior management team and in our engineering, research and development, sales and marketing, operations, and other organizations. In particular, our founder, President and Chief Executive Officer, Anthony Wood, is critical to our overall management, as well as the continued development of our products and streaming platform, our culture, and our strategic direction. We do not have long-term employment or non-competition agreements with any of our key personnel. The loss of one or more of our executive officers or the inability to promptly identify a suitable successor to a key role could have an adverse effect on our business.
Our ability to compete and grow depends in large part on the efforts and talents of our employees. Labor is subject to external factors that are beyond our control, including our industry’s highly competitive market for skilled workers and leaders, cost inflation, workforce participation rates, and unstable political conditions. Our employees, particularly engineers and other product developers, are in demand, and we devote significant resources to identifying, hiring, training, successfully integrating, and retaining these employees. To attract top talent, we generally offer competitive compensation packages before we can validate the productivity of those employees. In addition, many companies now offer a remote or hybrid work environment, which may increase the competition for employees from employers outside of our traditional office locations. To retain employees, we have in the past and may in the future need to increase our employee compensation levels or other benefits in response to competition and other business and macroeconomic factors. The loss of employees or the inability to hire additional skilled employees necessary to support our growth could result in significant disruptions to our business, and the integration of replacement personnel could be time-consuming and expensive and cause disruptions.
We believe a critical component to our success and our ability to retain our best people is our culture. As we continue to grow, we may find it difficult to maintain our entrepreneurial, execution-focused culture. In addition, past or any additional workforce reductions could harm employee morale and negatively impact employee recruiting and retention.
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We need to maintain operational and financial systems that can support our expected growth, increasingly complex business arrangements, and rules governing revenue and expense recognition, and any inability or failure to do so could adversely affect our financial reporting, billing, and payment services.
We have a complex business that is growing in size and complexity both in the United States and in international jurisdictions. To manage our growth and our increasingly complex business operations, especially as we move into new markets internationally or acquire new businesses, we will need to maintain and may need to upgrade our operational and financial systems and procedures, which requires management time and may result in significant additional expense. Our business arrangements with our content partners, advertisers, licensed Roku TV partners, and other licensees, and the rules that govern revenue and expense recognition in our business, are increasingly complex.
To manage the expected growth of our operations and increasing complexity, we must maintain operational and financial systems, procedures, and controls and continue to increase systems automation to reduce reliance on manual operations. An inability to do so will negatively affect our financial reporting, billing, and payment services. Our current and planned systems, procedures, and controls may not be adequate to support our complex arrangements and the rules governing revenue and expense recognition for our future operations and expected growth. Delays or problems associated with any improvement or expansion of our operational and financial systems and controls could adversely affect our relationships with our users, content partners, advertisers, advertisement agencies, licensed Roku TV partners, or other licensees; cause harm to our reputation and brand; and result in errors in our financial and other reporting.
We may pursue acquisitions, which involve a number of risks, and if we are unable to address and resolve these risks successfully, such acquisitions could harm our business.
We have in the past and may in the future acquire businesses, products, or technologies to expand our offerings and capabilities, user base, and business. We have evaluated, and expect to continue to evaluate, a wide array of potential strategic transactions; however, we have limited experience completing or integrating acquisitions. Any acquisition could be material to our financial condition and results of operations, and any anticipated benefits from an acquisition may never materialize.
Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results, may cause unfavorable accounting treatment, may expose us to claims and disputes by third parties, including intellectual property claims, and may not generate sufficient financial returns to offset additional costs and expenses related to the acquisitions.
In addition, the process of integrating acquired businesses, products, or technologies may create unforeseen operating difficulties and expenditures, in particular when the acquired businesses, products, or technologies involve areas of operation in which we have limited or no prior experience.
Acquisitions of businesses, products, or technologies in international markets would involve additional risks, including those related to integration of operations across different cultures and languages, currency risks, and the particular economic, political, and regulatory risks associated with specific countries. We may not be able to address these risks successfully, or at all, without incurring significant costs, delays, or other operational problems, and if we were unable to address such risks successfully, our business could be harmed.

Our credit facility provides our lenders with a first-priority lien against substantially all of our assets and contains financial covenants and other restrictions on our actions that may limit our operational flexibility or otherwise adversely affect our financial condition.*
On September 16, 2024, we entered into a credit agreement (the “Credit Agreement”), by and among us, as borrower, certain of our subsidiaries, as guarantors, the lenders and issuing banks party thereto, and Citibank N.A., as administrative agent (the “Agent”), providing for (i) a five-year revolving credit facility in an aggregate principal amount of up to $300.0 million, and (ii) an uncommitted increase option of up to an additional $300.0 million exercisable upon the satisfaction of certain customary conditions. The Credit Agreement provides for a $100.0 million sub-facility for the issuance of letters of credit, and certain existing letters of credit were deemed outstanding under this facility. The Credit Agreement will mature on September 16, 2029. Proceeds from the Credit Agreement may be used for general corporate purposes, including to finance working capital requirements. As of September 30, 2024, we had not borrowed against the Credit Agreement.
The Credit Agreement contains financial covenants requiring the maintenance of a minimum interest coverage ratio and a maximum total net leverage ratio, as well as customary events of default, the occurrence of which could result in amounts borrowed under the Credit Agreement becoming due and payable and remaining commitments terminated prior to the initial termination date on September 16, 2029. The Credit Agreement also contains a number of customary affirmative and negative covenants that, among other things, impose restrictions, subject to certain exceptions, on indebtedness, liens, fundamental changes, investments, asset dispositions, restricted payments, dividends and distributions, prepayment of other indebtedness, transactions with affiliates, restrictive agreements, amendments of material documents, and the abandonment of intellectual property. The obligations under the Credit Agreement, along with certain swap and banking services obligations, are secured by substantially all the assets of us and our subsidiaries that are guarantors under the Credit Agreement, except for certain customary excluded assets.
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As of September 30, 2024, we were in compliance with all of the covenants of the Credit Agreement. However, if we fail to comply with the covenants, fail to make payments as specified in the Credit Agreement, or undergo any other event of default contained in the Credit Agreement, the Agent could declare an event of default, which would give it the right to terminate the commitments to provide additional loans and declare any borrowings outstanding, together with accrued and unpaid interest and fees, to be immediately due and payable. In addition, the Agent would have the right to proceed against the assets we provided as collateral pursuant to the Credit Agreement. If any future outstanding debt under the Credit Agreement is accelerated, we may not have sufficient cash or be able to sell sufficient assets to repay it, which would harm our business and financial condition.
We may require additional capital to meet our financial obligations and support planned business growth, and this capital might not be available on acceptable terms or at all.*
We intend to continue to make significant investments to support planned business growth and may require additional funds to respond to business challenges, including the need to develop new products and enhance our streaming platform, continue to expand the content on our platform, maintain adequate levels of inventory to support our retail partners’ demand requirements, improve our operating infrastructure, or acquire complementary businesses, personnel, and technologies. Our primary uses of cash include operating costs such as personnel-related expenses and capital spending. Our future capital requirements may vary materially from those currently planned and will depend on many factors including our growth rate and the continuing market acceptance of our products and streaming platform, along with the timing and effort related to the introduction of new platform features, products, the hiring of experienced personnel, the expansion of sales and marketing activities, as well as overall economic conditions.
We may need to engage in equity or debt financings to secure additional funds. If we raise additional funds through future issuances of equity or convertible debt securities, our then existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our Class A common stock. Any debt financing we secure could involve additional restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. If we were to violate such restrictive covenants, we could incur penalties, increased expenses, and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business.
Our Credit Agreement matures on September 16, 2029. While we may enter into a new credit agreement in the future, we currently have no other committed source of financing, and we may not be able to obtain additional financing on terms favorable to us. Any future credit agreements we may enter into could require a lien on our assets or contain financial covenants and other restrictions that may limit our operational flexibility or otherwise adversely affect our financial condition. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be significantly impaired, and our business may be harmed.
We maintain cash deposits in excess of federally insured limits. Adverse developments affecting financial institutions, including bank failures, could adversely affect our liquidity and financial performance.
We maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks that exceed the FDIC insurance limits. We also maintain cash deposits in foreign banks where we operate, some of which are not insured or are only partially insured by the FDIC or similar agencies. Bank failures, events involving limited liquidity, defaults, non-performance, or other adverse developments that affect financial institutions, or concerns or rumors about such events, may lead to liquidity constraints. For example, in 2023, Silicon Valley Bank failed and was taken into receivership by the FDIC. The failure of a bank, or other adverse conditions in the financial or credit markets impacting financial institutions at which we maintain balances, could adversely impact our liquidity and financial performance. There can be no assurance that our deposits in excess of the FDIC or other comparable insurance limits will be backstopped by the U.S. or applicable foreign government, or that any bank or financial institution with which we do business will be able to obtain needed liquidity from other banks, government institutions, or by acquisition in the event of a failure or liquidity crisis.
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Risks Related to Cybersecurity, Reliability, and Data Privacy
Data security incidents, including cybersecurity attacks, or other significant disruptions of our information technology systems could harm our reputation, cause us to modify our business practices, and otherwise adversely affect our business and subject us to liability.*
We are dependent on information technology systems and infrastructure to operate our business. In the ordinary course of our business, we collect, store, process, and transmit large amounts of sensitive corporate, personal, and other information, including intellectual property, proprietary business information, user payment card information, user video and audio recordings, other user information, employee information, and other confidential information. It is critical that we do so in a secure manner to maintain the confidentiality, integrity, and availability of such information. Our obligations under applicable laws, regulations, contracts, industry standards, self-certifications, and other documentation may include maintaining the confidentiality, integrity, and availability of personal information in our possession or control, maintaining reasonable and appropriate security safeguards as part of an information security program, and complying with requirements regarding the use or cross-border transfer of such personal information. These obligations create potential legal liability to regulators, our business partners, our users, and other relevant stakeholders and impact the attractiveness of our services to existing and potential users.
We have outsourced certain elements of our operations (including elements of our information technology infrastructure) to third parties, or may have incorporated technology into our platform, that collects, processes, transmits, and stores our users’ or others’ personal information (such as payment card information and user video and audio recordings), and as a result, we manage a number of third-party vendors and other partners who may or could have access to our information technology systems (including our computer networks) or to our confidential information. In addition, many of those third parties in turn subcontract or outsource some of their responsibilities to third parties. As a result, our information technology systems, including the functions of third parties that are involved in or have access to those systems, are very large and complex.
While all information technology operations are inherently vulnerable to inadvertent or intentional security breaches, incidents, attacks, and exposures, the size, complexity, accessibility, and distributed nature of our information technology systems, and the large amounts of sensitive or personal information stored on those systems, make such systems vulnerable to unintentional or malicious, internal, and external threats on our technology environment. Vulnerabilities can be, and have been, exploited from inadvertent or intentional actions of our employees, third-party vendors, business partners, or by malicious third parties. Open-source software, which may be incorporated into our systems or products, inherently presents a large attack surface and may contain vulnerabilities of which we are not aware and which we cannot control or fully mitigate. Additionally, credential stuffing attacks are becoming increasingly common, and sophisticated actors can mask their attacks, making them increasingly difficult to identify and prevent. Moreover, AI technologies may be used to implement certain cybersecurity attacks or to increase their intensity, which may further increase risk. While we have processes in place to mitigate the risks related to these vulnerabilities, these measures may not be adequately designed or implemented to ensure that our operations are not disrupted, our reputation is not harmed, or that we will not be impacted by ransomware, cybersecurity attacks, or other vulnerabilities in the future.
There is no way of knowing with certainty whether we have experienced any data security incidents that have not been discovered. While we have no reason to believe that we have experienced a data security incident that we have not discovered, attackers have become very sophisticated in the way they conceal their unauthorized access to systems, and many companies that have been attacked are not aware that they have been attacked. Any event (including credential stuffing) that leads to unauthorized access, use, or disclosure of personal information, including but not limited to personal information regarding our users, could disrupt our business, harm our reputation, compel us to comply with applicable federal or state breach notification laws and foreign law equivalents, subject us to time-consuming, distracting, and expensive litigation, regulatory inquiries, investigations and oversight, mandatory corrective action, require us to verify the correctness of database contents, or otherwise subject us to liability under laws, regulations, and contractual obligations, including those that protect the privacy and security of personal information. This could result in increased costs to us and result in significant legal and financial exposure or reputational harm.
For example, despite our efforts to secure our information technology systems and the data contained in those systems, we and our third-party vendors and business partners have experienced, and remain vulnerable to, data security incidents, including ransomware, phishing attacks, bot attacks, credential stuffing attacks, improper employee access of confidential data, and inadvertent employee disclosure of confidential data. Our systems regularly experience directed attacks that are intended to interrupt our operations; interrupt our users’, content partners’, and advertisers’ ability to access our platform; extract money from us; or view or obtain our data (including without limitation user or employee personal information or proprietary information) or intellectual property. Our systems have been and may continue to be attacked through the use of compromised credentials, including those obtained through phishing or stolen from another source unrelated to us.
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Malicious attacks are increasing in their frequency, levels of persistence, sophistication, and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives (including, but not limited to, industrial espionage) and expertise, including organized criminal groups, “hacktivists,” nation states, and others. The geopolitical conflicts stemming from the Russian invasion of Ukraine and the current unrest in the Middle East have increased the risk of malicious attacks on information technology operations globally, including for companies headquartered in the United States, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell, and distribute our devices and services.
Most of our employees now have a hybrid work schedule (consisting of both in-person work and working from home). Although we have implemented work from home protocols, the actions of our employees while working from home may have a greater effect on the security of our systems and the data we process, including by increasing the risk of compromise to our systems, intellectual property, or data arising from employees’ combined use of personal and private devices, accessing our systems or data using wireless networks that we do not control, or the ability to transmit or store company-controlled data outside of our secured network.
In addition, information technology system disruptions, whether from attacks on our technology environment or from computer viruses, natural disasters, terrorism, war, foreign invasions, and telecommunications and electrical failures, could result in a material disruption of our product development and our business operations. Significant disruptions of our third-party vendors’ or commercial partners’ information technology systems or other similar data security incidents could also adversely affect our business operations or result in the loss, misappropriation, or unauthorized access, use or disclosure of, or the prevention of access to, sensitive or personal information, which could harm our business.
Though it is difficult to determine what harm may directly result from any specific interruption or breach, any failure to maintain performance, reliability, security, and availability of our network infrastructure to the satisfaction of our users, business partners, regulators, or other relevant stakeholders may harm our reputation and our ability to retain existing users and attract new users. Because of our prominence in the TV streaming industry, we believe we may be a particularly attractive target for threat actors. Any attempts by threat actors to disrupt our streaming platform, streaming devices, smart home products, website, computer systems, or mobile apps, if successful, could harm our business, subject us to liability, be expensive to remedy, cause harm to our systems and operations, damage our reputation, and could result in contractual damages, litigation, governmental inquiries and investigations, enforcement actions, and regulatory notification requirements, fines, and penalties that could harm our business. The risk of harm to our business caused by security incidents may also increase as we expand our product and service offerings and as we enter new markets. Efforts to prevent threat actors from entering our computer systems or exploiting vulnerabilities in our products are expensive to implement and may not be effective in detecting or preventing intrusion or vulnerabilities.
For example, in the wake of a data breach involving payment card data, we may be subject to substantial penalties for failure to adhere to the technical or operational security requirements of the Payment Card Industry (“PCI”) Data Security Standards (“DSS”) imposed by the PCI Council to protect cardholder data. Penalties arising from PCI DSS enforcement are inherently uncertain as penalties may be imposed by various entities within the payment card processing chain without regard to any statutory or universally mandated framework. Such enforcement could threaten our relationship with our banks, card brands we do business with, and our third-party payment processors.
There can be no assurance that the limitations of liability in our contracts would be enforceable or adequate or would otherwise protect us from liabilities or damages. While we maintain insurance policies to cover certain losses relating to our information technology systems, there may be exceptions. Security incidents may not be fully covered by our insurance policies, and some aspects of a security incident may not be covered at all. Additionally, insurance policies will not protect against the reputational harms caused by a major security incident. Even where an incident is covered by our insurance, the insurance limits may not cover the costs of complete remediation and redress that we may be faced with in the wake of a security incident.
The successful assertion of one or more large claims against us that exceeds our available insurance coverage, or results in changes to our insurance policies (including premium increases or the imposition of large deductible or co-insurance requirements), could have an adverse effect on our business. In addition, we cannot be sure that our existing insurance coverage and coverage for errors and omissions will continue to be available on acceptable terms or that our insurers will not deny coverage as to any future claim.
Data protection laws around the world often require “reasonable,” “appropriate,” or “adequate” technical and organizational security measures, and the interpretation and application of those laws are often uncertain and evolving, and there can be no assurance that our security measures will be deemed adequate, appropriate, or reasonable by a regulator or court. Moreover, even security measures that are deemed appropriate, reasonable, or in accordance with applicable legal requirements may not be able to protect the information we maintain. In addition to potential fines, we could be subject to mandatory corrective action due to a data security incident, which could adversely affect our business operations and result in substantial costs and reputational harm.
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We and our service providers and partners collect, process, transmit, and store personal and confidential information, which creates legal obligations and exposes us to potential liability.*
We collect, process, transmit, and store personal or confidential information about our users (and their devices), other consumers, employees, job applicants, and partners, and we rely on third-party service providers to collect, process, transmit, and store personal or confidential information (including our users’ payment card data and video and audio recordings). We collect such information from individuals located both in the United States and abroad and may store or process such information outside the country in which it was collected. Further, we, our service providers and our business partners use tracking technologies, including cookies, device identifiers, and related technologies, to help us manage and track our users’ interactions with our platform, devices, website, and partners’ content and deliver relevant advertising and personalized content for ourselves and on behalf of our partners on our products.
We collect information about the interaction of users with our platform, devices, website, advertisements, and content partners’ streaming apps. To deliver relevant advertisements effectively, we must successfully leverage this data, as well as data provided by third parties. Our ability to collect and use such data could be restricted by a number of factors, including users having the ability to refuse consent to or opt out from our, our service providers’, or our advertising partners’ collection and use of this data, restrictions imposed by advertisers, content partners, licensors, and service providers, changes in technology, and developments in laws, regulations, and industry standards. For example, certain European Union (“EU”) laws and regulations prohibit access to or storage of information on a user’s device (such as cookies and similar technologies that we use for advertising) that is not “strictly necessary” to provide a user-requested service or used for the “sole purpose” of a transmission unless the user has provided consent, and users may choose not to provide this consent to collection of information which is used for advertising purposes.
Additionally, certain device manufacturers or operating system providers may restrict the deployment of cookies and similar technologies, or otherwise restrict the collection of personal information through these or other tools, via our applications. Any restrictions on our ability to collect or use data, including instances where our users refuse to consent to the collection or use of their data, could harm our ability to grow our revenue, particularly our platform revenue which depends on engaging the relevant recipients of advertising campaigns.
Various federal, state, and foreign laws and regulations as well as industry standards and contractual obligations govern the collection, use, processing, retention, deletion, protection, disclosure, cross-border transfer, localization, sharing, and security of the data we receive from and about our users, employees, and other individuals. The regulatory requirements and consumer expectations related to the collection, use, processing, retention, and deletion of personal information by device manufacturers, online service providers, content distributors, advertisers, and publishers is evolving in the United States and internationally.
Privacy and consumer rights groups and government bodies (including the U.S. Federal Trade Commission (“FTC”), state attorneys general, the European Commission, European and UK data protection authorities, and the Brazilian national data protection authority), have increasingly scrutinized privacy issues with respect to devices that identify or are identifiable to a person (or household or device) and personal information collected through the internet, and we expect such scrutiny to continue to increase.
The U.S. federal government, U.S. states, and foreign governments have enacted (or are considering) laws and regulations that could significantly restrict industry participants’ ability to collect, use, and share personal information, such as by regulating the level of consumer notice and consent required before a company can place cookies or other tracking technologies or collect categories of personal information deemed sensitive. For example, the EU General Data Protection Regulation (“GDPR”) imposes detailed requirements related to the collection, storage, and use of personal information related to people located in the EU (or which is processed in the context of EU operations) and places data protection obligations and restrictions on organizations, including requiring a company to delete collected data, and may require us to make further changes to our policies and procedures in the future beyond what we have already done. In addition, in the wake of the United Kingdom’s withdrawal from the EU (“Brexit”), the United Kingdom has adopted a framework similar to the GDPR. The EU has confirmed that the UK data protection framework is “adequate” to receive EU personal data.
Data protection laws and regulations continue to proliferate throughout the world. We continue to monitor the implementation and evolution of such laws and regulations, but if we are not compliant with data protection laws or regulations if and when implemented, we may be subject to significant fines and penalties (such as restrictions on personal information processing) and our business may be harmed. For example, under the GDPR, fines of up to 20 million euros or 4% of the annual global revenue of a noncompliant company, whichever is higher, as well as data processing restrictions, could be imposed for violation of certain of the GDPR’s requirements.
The U.S. data protection legal landscape also continues to evolve, with various states having enacted broad-based data privacy and protection legislation and with states and the federal government continuing to consider additional data privacy and protection legislation. The potential effects of this legislation are far-reaching and may require us to modify our data processing practices and policies and incur substantial costs and expenses in an effort to comply. For example, the California Consumer Privacy Act (“CCPA”) provides for civil penalties for violations, as well as a private right of action
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for certain data breaches that may increase data breach litigation. The California Privacy Rights Act (“CPRA”), which amended the CCPA, among other things, established a dedicated agency to regulate and enforce the CCPA.
Furthermore, rules governing new technological developments, such as developments in generative AI, remain unsettled. Several national and local governments have proposed or enacted measures related to the use of AI technologies in products and services. For example, in the EU, legislators adopted the EU AI Act in May 2024. The EU AI Act imposes new and substantial obligations related to the use of AI-related systems. In the United States, there similarly is growing interest among federal, state, and local policymakers with respect to potential legislation, regulation, and/or guidance to address perceived concerns with the rapid uptake of AI technologies. During the 2024 legislative session, multiple U.S. states adopted laws concerning AI. The rules and regulations adopted by policymakers over time may require us to make changes to our business practices.
We are continuing to assess the impact of new and proposed data privacy and protection laws and proposed amendments to existing laws on our business. Among other things, such restrictions are likely to increase the number of users to whom we cannot serve targeted advertising, and are likely to restrict our ability to collect and process certain types of information deemed sensitive under these new laws. The Canadian province of Quebec has also enacted a data protection law, known as Bill 64, that may similarly impose requirements on our data processing activities.
In addition, each U.S. state and most U.S. territories, each EU member state, and the United Kingdom, as well as many other foreign nations, have passed laws requiring notification to regulatory authorities, affected users, or others within a specific timeframe when there has been a security breach involving, or other unauthorized access to or acquisition or disclosure of, certain personal information and impose additional obligations on companies. Additionally, our agreements with certain users or partners may require us to notify them in the event of a security breach. Such statutory and contractual disclosures are costly, could lead to negative publicity, may cause our users to lose confidence in the effectiveness of our security measures, and may require us to expend significant capital and other resources to respond to or alleviate problems caused by the actual or perceived security breach. Compliance with these obligations could delay or impede the development of new products and may cause reputational harm.
As part of our data protection compliance program, we have implemented data transfer mechanisms to provide for the transfer of personal information from the European Economic Area (the “EEA”) or the United Kingdom to the United States. After a period of uncertainty concerning certain mechanisms for data transfers to the United States, in July 2023, the European Commission adopted an adequacy decision concerning a new framework for data transfers from the EEA to the United States, known as the EU-U.S. Data Privacy Framework (“EU-U.S. DPF”). That decision recognizes that the United States ensures an adequate level of protection for personal information transferred from the EEA to organizations participating in the EU-U.S. DPF. The United Kingdom has made a similar determination, providing a means by which data transfers may take place between the United States and the United Kingdom. That framework, known as the UK Extension to the EU-U.S. DPF, became effective in October 2023. We have since joined the EU, Swiss, and UK DPF programs to facilitate any transfers of non-HR personal data to the United States from these jurisdictions.
In addition, cloud service providers upon which our services depend are experiencing heightened scrutiny from EU regulators, which may lead to significant shifts or unavailability of cloud services to transfer personal information outside the EU, which may significantly impact our costs or ability to operate.
We continue to assess the available regulatory guidance, determinations, and enforcement actions from EU Data Protection Authorities and the U.S. Department of Commerce on international data transfer compliance for companies. Our ability to continue to transfer personal information outside of the EU may become significantly more costly and may subject us to increased scrutiny and liability under the GDPR or other legal frameworks, and we may experience operating disruptions if we are unable to conduct these transfers in the future.
We will continue to review our business practices and may find it necessary or desirable to make changes to our personal information processing to cause our transfer and receipt of EEA residents’ personal information to conform to applicable European law. The regulation of data privacy in the EU continues to evolve, and it is not possible to predict the ultimate effect of evolving data protection regulation and implementation over time. Member states also have some flexibility to supplement the GDPR with their own laws and regulations and may apply stricter requirements for certain data processing activities.
In addition, some countries are considering or have enacted “data localization” laws requiring that user data regarding users in their respective countries be maintained, stored, or processed in their respective countries. Maintaining local data centers in individual countries could increase our operating costs significantly. We expect that, in addition to the “business as usual” costs of compliance, the evolving regulatory interpretation and enforcement of laws such as the GDPR and CCPA, as well as other domestic and foreign data protection laws, will lead to increased operational and compliance costs and will require us to continually monitor and, where necessary, make changes to our operations, policies, and procedures. Any failure or perceived failure to comply with privacy-related legal obligations, or any compromise of security of user data, may result in governmental enforcement actions, litigation, contractual indemnities, or public statements against us by consumer advocacy groups or others. In addition to potential liability, these events could harm our business.
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We publish privacy policies, notices, and other documentation regarding our collection, processing, use, and disclosure of personal information, credit card information, and other confidential information. Although we endeavor to comply with our published policies, certifications, and documentation, we may at times fail to do so or may be perceived to have failed to do so. Moreover, despite our efforts, we may not be successful in achieving compliance if our employees, representatives, agents, vendors, or other third parties fail to comply with our published policies, certifications, and documentation. Such failures could subject us to potential international, local, state, and federal action, substantial monetary fines, and other penalties if they are found to be deceptive, unfair, or misrepresentative of our actual practices, which could harm our business, financial condition, and results of operations.
We have incurred, and will continue to incur, expenses to comply with privacy and security standards and protocols imposed by law, regulation, industry standards, and contractual obligations. Increased regulation of data collection, use, and security practices, including self-regulation and industry standards, changes in existing laws, enactment of new laws, increased enforcement activity, and changes in interpretation of laws, could increase our cost of compliance and operation, limit our ability to grow our business, or otherwise harm our business.
Any significant disruption in our information technology systems or those of third parties we utilize in our operations could result in a loss or degradation of service on our platform and could harm our business.*
We rely on the expertise of our engineering and software development teams as well as the teams of our service providers and partners for the performance and operation of the Roku OS, streaming platform, smart home products, and other information technology systems. Service interruptions, errors in our software, or the unavailability of information technology systems used in our operations could diminish the overall attractiveness of our products and streaming platform to existing and potential users or otherwise disrupt our business. We utilize information technology systems located either in our facilities or those of third-party server hosting providers and third-party internet-based or cloud computing services. Although we generally enter into service level agreements with these parties, we exercise no control over their operations, which makes us vulnerable to any errors, interruptions, or delays that they may experience.
We have transitioned, and may continue to transition, features of our services from our managed hosting systems to cloud computing services, which may require significant expenditures and engineering resources. If we are unable to manage such a transition effectively, we may experience a loss or degradation in services, operational delays, or inefficiencies until the transition is complete. Upon the expiration or termination of any of our agreements with third-party vendors, we may not be able to replace their services in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete. In addition, fires, floods, earthquakes, wars, foreign invasions, terrorist activity, power losses, telecommunications failures, break-ins, and similar events could damage these systems and hardware or cause them to fail completely.
As we do not maintain entirely redundant systems, a disrupting event could result in prolonged downtime of our operations, products, or services, could result in liabilities to our customers or third parties, and could adversely affect our business. Our property insurance and cyber liability insurance may not be sufficient to fully cover our losses or may not cover a particular event at all. Any disruption in the services provided by these vendors could have adverse impacts on our business reputation, customer relations, and operating results.
If any aspect of our information technology systems or those of third parties we utilize in our operations fails, it may lead to downtime or slow processing time, either of which may harm the experience of our users. We have experienced, and may in the future experience, service disruptions, outages, and other performance problems due to a variety of factors, including infrastructure changes, human or software errors, and capacity constraints. We expect to continue to invest in our technology infrastructure to maintain and improve the user experience and platform performance. To the extent that we or our third-party service hosting providers do not effectively address capacity constraints, upgrade or patch systems as needed, and continually develop technology and network architecture to accommodate increasingly complex services and functions, increasing numbers of users, and actual and anticipated changes in technology, our business may be harmed.
Changes in how network operators manage data that travel across their networks could harm our business.
Our business relies upon the ability of our users to access high-quality streaming content through the internet. As a result, the growth of our business depends on our users’ ability to obtain and maintain high-speed access to the internet at reasonable cost, which relies in part on internet service network operators’ continuing willingness to upgrade and maintain their equipment as needed to sustain a robust internet infrastructure as well as their continued willingness to preserve the open and interconnected nature of the internet. We exercise no control over network operators, which makes us vulnerable to any errors, disruptions, or delays in their operations, as well as any decision they may make to prioritize the delivery of certain network traffic at the expense of other traffic. Any material disruption or degradation in internet services could harm our business.
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To the extent that the number of internet users continues to increase, network congestion could adversely affect the reliability of our streaming platform. We may also face increased costs of doing business, or decreased demand for our services, if network operators engage in discriminatory practices with respect to streamed video content in an effort to monetize access to their networks or customers by data providers.
Certain laws intended to prevent network operators from engaging in discriminatory practices with respect to streaming video content have been implemented in many countries, including in the EU. In other countries, laws in this area may be nascent or non-existent. Furthermore, favorable laws may change. Given the uncertainty around these laws and the rules that implement them, including changing interpretations, amendments, or repeal, coupled with potentially significant political and economic power of network operators, we could experience discriminatory or anti-competitive practices, such as usage-based pricing, bandwidth caps, zero rating of competing services by ISPs, and traffic “shaping” or throttling, that could impede our growth, result in a decline in our quality of service, cause us to incur additional expense, or otherwise impair our ability to attract and retain users, all of which could harm our business.
In addition, most network operators that provide users with access to the internet also offer users multichannel video programming, and some network operators also own streaming services. These network operators have an incentive to use their network infrastructure in a manner adverse to the continued growth and success of other companies seeking to distribute similar video programming. To the extent that network operators are able to provide preferential treatment to their own data and content, as opposed to ours, our business could be harmed.
Risks Related to Intellectual Property
Litigation and claims regarding intellectual property rights could result in the loss of rights important to our products and streaming platform, cause us to incur significant legal costs, or otherwise harm our business.
Some internet, technology, and media companies, including some of our competitors, own large numbers of patents, copyrights, and trademarks, which they may use to assert claims against us. Third parties have asserted, and may in the future assert, that we have infringed, misappropriated, or otherwise violated their intellectual property rights. As we grow and face increasing competition, the possibility of intellectual property rights claims against us will grow. Plaintiffs who have no relevant product revenue may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us and may seek to challenge the validity or enforceability of our own patents and patents applications. The cost of patent litigation or other proceedings, even if resolved in our favor, has been and is expected to be substantial. Some of our competitors may be better able to sustain the costs of such litigation or proceedings because of their substantially greater financial resources. Patent litigation and other proceedings may also require significant management time and divert management’s attention from our other business concerns or otherwise adversely affect our business and operating results. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could impair our ability to compete in the marketplace. The occurrence of any of the foregoing could harm our business.
As a result of intellectual property infringement claims, or to avoid potential claims, we may choose or be required to seek licenses from third parties. These licenses may not be available on commercially reasonable terms, or at all, thereby hindering our ability to sell or use the relevant technology or requiring redesign of the allegedly infringing solutions to avoid infringement, which could be costly, time‐consuming, or impossible. Even if we are able to obtain a license, the license would likely obligate us to pay license fees or royalties or both, and the rights granted to us might be nonexclusive, with the potential for our competitors to gain access to the same intellectual property. In addition, the rights that we secure under intellectual property licenses may not include rights to all of the intellectual property owned or controlled by the licensor, and the scope of the licenses granted to us may not include rights covering all of the products and services provided by us and our licensees. Furthermore, an adverse outcome of a dispute may require us to: pay damages, potentially including treble damages and attorneys’ fees, if we are found to have willfully infringed a party’s intellectual property; cease making, licensing, or using technologies that are alleged to infringe or misappropriate the intellectual property of others; expend additional development resources to redesign our products; enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content, or materials; and indemnify our partners and other third parties. For example, we have in the past elected to develop and implement specific design changes to address potential risks that certain products could otherwise become subject to exclusion or cease and desist orders arising from patent infringement and other intellectual property claims brought in the U.S. International Trade Commission. In addition, any lawsuits regarding intellectual property rights, regardless of their success, could be expensive to resolve and would divert the time and attention of our management and technical personnel.
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If we fail to, or are unable to, protect or enforce our intellectual property or proprietary rights, our business and operating results could be harmed.
We regard the protection of our patents, trade secrets, copyrights, trademarks, trade dress, domain names, and other intellectual property or proprietary rights as critical to our success. We strive to protect our intellectual property rights by relying on federal, state, and common law rights, as well as contractual restrictions. We seek to protect our confidential proprietary information, in part, by entering into confidentiality agreements and invention assignment agreements with all of our employees, consultants, contractors, advisors, and any third parties who have access to our proprietary know-how, information, or technology.
However, we cannot be certain that we have executed such agreements with all parties who may have helped to develop our intellectual property or who had access to our proprietary information, nor can we be certain that our agreements will not be breached. Any party with whom we have executed such an agreement could potentially breach that agreement and disclose our proprietary information, including our trade secrets, and we may not be able to discover such breaches, and if we do, we may not be able to obtain adequate remedies for such breaches. We cannot guarantee that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. Detecting the disclosure or misappropriation of a trade secret and enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, time-consuming, and could result in substantial costs, and the outcome of such a claim is unpredictable.
Further, the laws of certain foreign countries do not provide the same level of protection of corporate proprietary information and assets such as intellectual property, trademarks, trade secrets, know-how, and records as the laws of the United States. For instance, the legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection. As a result, we may encounter significant problems in protecting and defending our intellectual property or proprietary rights abroad. Additionally, we may also be exposed to material risks of theft or unauthorized reverse engineering of our proprietary information and other intellectual property, including technical data, manufacturing processes, data sets, or other sensitive information.
Our efforts to enforce our intellectual property rights in such foreign countries may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop, which could have a material adverse effect on our business, financial condition, and results of operations. Moreover, if we are unable to prevent the disclosure of our trade secrets to third parties, or if our competitors independently develop any of our trade secrets, we may not be able to establish or maintain a competitive advantage in our market, which could harm our business.
There can be no assurance that the particular forms of intellectual property protection that we seek, including business decisions about when to file patents and when to maintain trade secrets, will be adequate to protect our business. We have filed and will in the future file patent applications on inventions that we deem to be innovative. There is no guarantee that our patent applications will issue as granted patents, that the scope of the protection gained will be sufficient or that an issued patent may subsequently be deemed invalid or unenforceable. U.S. patent laws, and the scope of coverage afforded by them, have been subject to significant changes, such as the change to “first-to-file” from “first-to-invent” resulting from the Leahy-Smith America Invents Act. This change in the determination of inventorship may result in inventors and companies having to file patent applications more frequently to preserve rights in their inventions, which may favor larger competitors that have the resources to file more patent applications. Another change to the patent laws may incentivize third parties to challenge any issued patent in the United States Patent and Trademark Office (“USPTO”), as opposed to having to bring such an action in U.S. federal court. Foreign patent laws may also continue to develop and significantly impact our ability to protect or maintain our intellectual property. Any invalidation of a patent claim could have a significant impact on our ability to protect the innovations contained within our products and platform and could harm our business.
The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment, and other provisions to maintain patent applications and issued patents. We may fail to take the necessary actions and pay the applicable fees to obtain or maintain our patents. Noncompliance with these requirements can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, competitors might be able to use our technologies and enter the market earlier than would otherwise have been the case.
We pursue the registration of our domain names, trademarks, and service marks in the United States and in certain locations outside the United States. We are seeking to protect our trademarks, patents, and domain names in an increasing number of jurisdictions, a process that is expensive and time-consuming and may not be successful or which we may not pursue in every jurisdiction in which we conduct business. Despite the cost and time we spend monitoring, we may or may not be able to detect infringement by third parties. Our competitive position may be harmed if we cannot detect infringement and enforce our intellectual property rights quickly or at all. In particular, our actions to monitor and enforce our trademarks against third parties may not prevent counterfeit versions of our products or products bearing confusingly similar trademarks to ours from entering the marketplace, which could divert sales from us, tarnish our reputation, or reduce the demand for our products. In some circumstances, we may choose to not pursue enforcement because an infringer has a dominant intellectual property position or for other business reasons.
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Litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets, or determine the validity and scope of proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in substantial costs, adverse publicity, or diversion of management and technical resources, any of which could adversely affect our business and operating results. If we fail to maintain, protect, and enhance our intellectual property or proprietary rights, our business may be harmed.
Our use of open-source software could impose limitations on our ability to commercialize our products and our streaming platform or could result in public disclosure of competitively sensitive trade secrets.
We incorporate open-source software in our proprietary software. From time to time, companies that have incorporated open-source software into their products and services have faced claims challenging the ownership of certain open-source software or compliance with open-source software license terms. Therefore, we could be subject to similar suits by parties claiming ownership of what we believe to be open-source software or our noncompliance with the open-source software license terms.
Although we have processes and procedures designed to help monitor our use of open-source software, these processes and procedures may not be followed appropriately or may fail to identify risks. Additionally, the terms of many open-source software licenses have not been interpreted by U.S. courts, and there is a risk that such licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our products or technology or impose unanticipated obligations that could require the disclosure of trade secrets. Some open‐source software is governed by licenses containing conditions that any person who distributes or uses a modification or derivative work of software that was subject to an open‐source license make the modified version subject to the same open‐source license. Distributing or using software that is subject to this kind of open‐source license can lead to a requirement that certain aspects of our solutions be distributed or made available in source code form. In such event, we could be required to make portions of our proprietary software generally available under similar open-source software license terms to third parties, including competitors, at low or no cost, to seek licenses from third parties in order to continue offering our products, to re-engineer our products, or to discontinue the sale of our products in the event re-engineering cannot be accomplished on a timely basis or at all, any of which could harm our business.
Further, use of open‐source software can involve greater risks than those associated with use of third‐party commercial software, as open‐source licensors generally do not provide warranties, assurances of title, performance, non‐infringement, or controls on the origin of the software. Open‐source software typically lacks support, and authors of such open‐source software may abandon further development and maintenance. Open‐source software may contain security vulnerabilities and other liabilities, and we may be subject to additional security risk by using open‐source software. We have established processes to help alleviate these risks, but there can be no assurance that these processes will alleviate all risks with the open‐source software we incorporate.
Under our agreements with many of our content partners, licensees, distributors, retailers, contract manufacturers, and suppliers, we are required to provide indemnification in the event our technology is alleged to infringe upon the intellectual property rights of third parties.
In certain of our agreements, we indemnify our content partners, licensees, distributors, retailers, manufacturing partners, and suppliers. We have in the past, and may in the future, incur significant expenses defending these partners if they are sued for patent or other property infringement based on allegations related to our technology. If a partner were to lose a lawsuit and in turn seek indemnification from us, we also could be subject to significant monetary liabilities. In addition, because the devices sold by our licensing partners and licensed Roku TV partners often involve the use of third-party technology, this increases our exposure to litigation in circumstances where there is a claim of infringement asserted against the streaming device in question, even if the claim does not pertain to our technology. Liability under our indemnification commitments may not be contractually limited.
Risks Related to Macroeconomic Conditions
Macroeconomic uncertainties have in the past and may continue to adversely impact our business, results of operations, and financial condition.*
Macroeconomic uncertainties, including increased inflation and interest rates, slow growth or recession, higher interest rates, financial and credit market fluctuations, changes in economic policy, bank failures, labor disputes, and global supply chain constraints have in the past, and may continue to, adversely impact consumer confidence and spending and materially adversely affect many aspects of our business.
Our business is dependent on consumer discretionary spending and advertising spending, both of which are susceptible to changes in macroeconomic conditions. Sustained or worsening inflation or an economic downturn has in the past and may in the future result in fewer consumer purchases of our products or the products of our licensed Roku TV partners and reduced advertising spending. Advertising budgets in a variety of industries have been pressured by factors such as inflation, rising interest rates, and related market uncertainty, which led to reduced advertiser spending and adversely affected our platform revenue. Further, even if the broader advertising market recovers, advertisers may
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not choose to advertise on our platform. Any pullback in consumer discretionary spending or advertising spending could adversely affect our future operating results.
In addition, a significant reduction in the supply of original entertainment content, including as a result of macroeconomic factors or labor disputes (such as the 2023 strikes called by the Writers Guild of America and SAG‐AFTRA), could in turn reduce the demand for advertising and media and entertainment promotional spending campaigns on our platform, and have a material adverse effect on our financial condition, operating results, and key performance metrics.
The extent to which macroeconomic uncertainties may continue to impact our operational and financial performance remains uncertain and will depend on many factors outside our control. These direct and indirect impacts may negatively affect our business and operating results.
Natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events could disrupt and impact our business.*
Occurrence of any catastrophic event, including an earthquake, flood, tsunami, or other weather event, power loss, internet failure, software or hardware malfunctions, cybersecurity attack, war or foreign invasion (such as the Russian invasion of Ukraine and the unrest in the Middle East), terrorist attack and other geopolitical conflicts (such as Yemen’s Houthi attacks in the Red Sea), medical epidemic or pandemic (such as the COVID-19 pandemic), government shutdown orders, other man-made disasters, or other catastrophic events could disrupt our, our business partners’ and customers’ business operations or result in disruptions in the broader global economic environment. Any of these business disruptions could require substantial expenditures and recovery time in order to fully resume operations.
In particular, our principal offices are located in California, and our contract manufacturers and some of our suppliers are located in Asia, both of which are regions known for seismic activity, making our operations in these areas vulnerable to natural disasters or other business disruptions in these areas. Our insurance coverage may not compensate us for losses that may occur in the event of an earthquake or other significant natural disaster. For example, a recent earthquake damaged equipment in our Taiwan office, and the losses, while relatively minor, were not covered by our insurance.
In addition, our offices and facilities, and those of our contract manufacturers, suppliers, and licensed Roku TV partners, could be vulnerable to the effects of climate change (such as sea level rise, drought, flooding, wildfires, and increased storm severity) that could disrupt our business operations. For example, in California, increasing intensity of drought and annual periods of wildfire danger increase the probability of planned power outages. Further, acts of terrorism could cause disruptions to the internet or the economy as a whole.
If our streaming platform was to fail or be negatively impacted as a result of a natural disaster or other event, our ability to deliver streaming content, including advertising, to our users would be impaired. Disruptions in the operations of our contract manufacturers, suppliers, or licensed Roku TV partners as a result of a disaster or other catastrophic event could delay the manufacture and shipment of our products or the products of our licensed Roku TV partners, which could impact our business. If we are unable to develop adequate plans to ensure that our business functions continue to operate during and after a natural disaster or other catastrophic event and to execute successfully on those plans in the event of a disaster or catastrophic event, our business would be harmed.
Legal and Regulatory Risks
We have been, are currently, and may in the future be subject to various lawsuits and other legal proceedings, disputes, claims, and government inquiries and investigations, which could cause us to incur substantial costs or require us to change our business practices in a way that could seriously harm our business.*
We have been, are currently, and may in the future be subject to various lawsuits, stockholder derivative actions, class action lawsuits, individual or mass arbitration proceedings, and other types of legal proceedings, as well as other disputes, claims, and regulatory or governmental inquiries and investigations, including with regard to contract or commercial disputes, consumer protection, privacy, data protection, intellectual property, tax, employment, and corporate governance, among other matters. If we fail to meet our contractual commitments or otherwise fail to comply with our contractual obligations, then we could be subject to breach of contract or other claims. Any claims, proceedings, individual or mass arbitration demands, or inquiries or investigations initiated by or against us, whether successful or not, may be time-consuming, subject us to damage awards, regulatory orders, consent decrees, injunctive relief, fines, or other penalties or sanctions, require us to change our policies or practices, result in increased operating costs, divert management’s attention, harm our reputation, and require us to incur significant legal fees, other litigation costs and settlement costs, as well as other expenses. In addition, our insurance may not be adequate to protect us from all material expenses related to pending and future claims. Any of these factors could materially and adversely affect our business, financial condition, and results of operations.
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If government regulations or laws relating to the internet, video, advertising, or other areas of our business change, we may need to alter the manner in which we conduct our business, or our business could be harmed.*
We are subject to or affected by general business regulations and laws, as well as regulations and laws specific to the internet and online services, including laws and regulations related to data privacy and security, consumer protection, data localization, law enforcement access to data, encryption, telecommunications, social media, payment processing, subscriptions, taxation, trade, intellectual property, competition, electronic contracts, internet access, net neutrality, advertising, calling and texting, content restrictions, protection of children, and accessibility, among others. We cannot guarantee that we have been or will be fully compliant in every jurisdiction. Litigation and regulatory proceedings are inherently uncertain, and the federal, state, and foreign laws and regulations governing issues such as data privacy and security, payment processing, taxation, net neutrality, liability of providers of online services, video, telecommunications, e-commerce tariffs, and consumer protection related to the internet continue to develop. Moreover, as internet commerce and advertising continue to evolve, increasing regulation by federal, state, and foreign regulatory authorities becomes more likely.
As we develop new services and devices and improve our streaming platform, we may also be subject to new laws and regulations specific to such technologies. For example, in developing the reference design of TVs powered by the Roku OS, we were required to understand, address, and comply with an evolving regulatory framework for developing, manufacturing, marketing, and selling TVs. If we fail to adequately address or comply with such regulations regarding the manufacture and sale of TVs, we may be subject to fines or sanctions, and we or our licensed Roku TV partners may be unable to sell TVs powered by the Roku OS at all, which could harm our business and our ability to grow our user base.
Laws relating to data privacy and security, data localization, law enforcement access to data, encryption, consumer protection, children’s online protection, and similar activities continue to proliferate, often with little harmonization between jurisdictions and limited guidance. A number of bills are pending in the U.S. Congress and other government bodies that contain provisions that would regulate, for example, how companies can use cookies and other tracking technologies to collect, use, and share user information. Certain state laws, such as the CCPA, also impose requirements on certain tracking activity. The EU has laws requiring advertisers or companies like ours to, for example, obtain unambiguous, affirmative consent from users for the placement of cookies or other tracking technologies and the delivery of relevant advertisements. In addition, the EU has adopted the Digital Services Act, which is legislation that updates the liability and safety rules for digital platforms, products, and services. The EU also has adopted the Data Act, which seeks to enhance interoperability and facilitate data sharing and reuse across products and services.
Regulatory inquiries, investigations, and enforcement actions could also impact our business operations. For example, we and other companies in the media, entertainment, and advertising technology industries have been subject to government inquiries and investigations by regulatory bodies with regard to our compliance with data privacy and security laws, the Federal Trade Commission Act, and other applicable laws and regulations. Advocacy organizations have also filed complaints with data protection authorities against businesses with streaming apps and advertising technology, arguing that certain of these companies’ practices do not comply with the CCPA or other regulations. Such inquiries, investigations, or enforcement actions may require us to alter our practices. Further, if we or the third parties that we work with, such as contract payment processing services, content partners, vendors, or developers, violate or are alleged to violate applicable privacy or security laws, laws concerning access to data, industry standards, our contractual obligations, or our policies, such violations and alleged violations may also put our users’ information at risk and could in turn harm our business and reputation and subject us to potential liability. Any of these consequences could cause our users, advertisers, or content partners to lose trust in us, which could harm our business. Furthermore, any failure on our part to comply with these laws may subject us to liability and reputational harm.
Our use of data to deliver relevant advertising and other services on our platform places us and our content partners at risk for claims under various unsettled laws, including the Video Privacy Protection Act (“VPPA”). Some of our content partners have been engaged in litigation over alleged violations of the VPPA relating to activities on our platform in connection with advertising provided by unrelated third parties.
In addition, in 2019, the FTC initiated a review of its rules implementing the Children’s Online Privacy Protection Act (“COPPA”), which limits the collection by operators of online services of personal information from children under the age of 13. Following this review, in December 2023, the FTC issued a formal Notice of Proposed Rulemaking that proposes specific revisions to the COPPA rule and seeks additional public input. Among other topics, the FTC has proposed rule changes that would prohibit targeted advertising to children absent express opt-in consent from parents, strengthen data security requirements for children’s personal information, and limit the period during which children’s personal information can be retained. The review has not been concluded and could result in broadening the applicability of COPPA and other changes.
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There have also been proposals in the U.S. Congress to amend and expand COPPA. Changes to the COPPA legislation or rules could limit the information that we or our content partners and advertisers may collect and use and the content of advertisements in relation to certain app partner content. The CCPA and certain other state privacy laws also impose certain opt in and opt out requirements before certain information about minors can be collected. Many states have incorporated children’s privacy requirements into their laws, and in some cases those requirements impose additional obligations not found in COPPA.
Some states also have adopted Age Appropriate Design Codes. For example, in 2022, California adopted the Age-Appropriate Design Code Act (“AADCA”), which has a stated purpose of protecting “the well being, data, and privacy of children using online platforms.” The AADCA was challenged in court, and a federal appellate court recently agreed that the AADCA’s mandate that required covered businesses to prepare and implement a “Data Protection Impact Assessment” is unconstitutional. Other aspects of the AADCA, however, may be allowed to go into effect. Since adoption of the California law, similar legislation has been introduced in other U.S. states. For example, the Maryland Age-Appropriate Design Code Act, which went into effect on October 1, 2024, is similar in many respects to the California AADCA. The EU and many of its member states, among other jurisdictions, also have rules that limit processing of personal information, including children’s data, and that impose specific requirements intended to protect children online. We and our content partners and advertisers could be at risk for violation or alleged violation of these and other privacy, advertising, children’s online protection, or similar laws. This could subject us to potential legal actions, substantial monetary fines, and other penalties, which could negatively affect our business, financial condition, and results of operations.
Changes in U.S. or foreign trade policies, geopolitical conditions, general economic conditions, and other factors beyond our control may adversely impact our business and operating results.
Our business is subject to risks generally associated with doing business abroad, such as U.S. and foreign governmental regulation in the countries in which we operate and the countries in which our contract manufacturers, component suppliers, and other business partners are located. Our operations and performance depend significantly on global, regional, and U.S. economic and geopolitical conditions.
For example, tensions between the United States and China have led to the United States’ imposition of a series of tariffs, sanctions, and other restrictions on imports from China and sourcing from certain Chinese persons or entities, as well as other business restrictions. Following Russia’s invasion of Ukraine, the United States and other countries imposed economic sanctions and severe export control restrictions against Russia and Belarus, and the United States and other countries could impose wider sanctions and export restrictions and take other actions should the conflict further escalate. In addition, the effects of Brexit on EU-UK political, trade, economic, and diplomatic relations continue to be uncertain and such impact may not be fully realized for several years or more. Continued uncertainty and friction may result in regulatory, operational, and cost challenges to our international operations.
These and other trade disputes, geopolitical tensions, or political uncertainty can disrupt supply chains and increase the cost of our and our partners’ products, and have a negative impact on consumer confidence, which could impair our future growth and adversely affect our international operations, business, financial condition, and results of operations.
Also, various countries, in addition to the United States, regulate the import and export of certain products, commodities, software, and technology, including through import and export licensing requirements, and have enacted laws that could limit our ability to distribute our products or collaborate on technology with our commercial or strategic partners, or could limit the ability of our commercial or strategic partners to implement our products in those countries. Changes in our products or future changes in export and import regulations may create delays in the introduction of our products in international markets, disrupt supply chains, prevent our commercial or strategic partners with international operations from deploying our products globally, or, in some cases, prevent the export or import of our products to certain countries, governments, or persons altogether. Any changes in U.S. or foreign export or import regulations, customs duties, or other restrictions on intangible goods (such as cross-border data flows) could result in decreased use of our products by, or in our decreased ability to export or sell our products and services to, existing or new customers in U.S. or international markets or hamper our ability to source products, components, and parts from certain suppliers or lead to potential supply chain disruptions and business or reputational harms. Any decreased use of our products or limitation on our ability to export, import, or sell our products or services, or source parts or components, could harm our business.
Although we attempt to ensure that we, our retailers, and partners comply with the applicable import, export, and sanctions laws, we cannot guarantee full compliance by all. Actions of our retailers and partners are not within our complete control, and our products could be re-exported to sanctioned persons or countries or provided by our retailers to third persons in contravention of our requirements or instructions or the laws. In addition, there are inherent limitations to the effectiveness of any policies, procedures, and internal controls relating to such compliance, and there can be no assurance that such procedures or internal controls will work effectively at all times or protect us against liability under anti-corruption, sanctions or other laws for actions taken by us, our retailers or partners. Any such potential violation by us, our retailers, or our partners could have negative consequences, including government inquiries, investigations, enforcement actions, monetary fines, or civil and/or criminal penalties, and our reputation, brand, and revenue may be harmed.
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The ability of internet access network operators in some jurisdictions to degrade users’ internet speeds or limit internet data consumption by users, including unreasonable discrimination in the provision of broadband internet access services, could harm our business.*
Our products and services depend on the ability of our users to access the internet. We believe that the continued growth of streaming as an entertainment alternative will depend on the availability and growth of cost-effective broadband internet access (including mobile broadband internet access), the quality and reliability of broadband content delivery, and broadband service providers’ ability to control the delivery speed of different content traveling on their networks. Laws, regulations, or court rulings that adversely affect the popularity or growth in use of the internet, including decisions that undermine open and neutrally administered internet access, or that disincentivize internet access network operators’ willingness to invest in upgrades and maintenance of their equipment, could decrease customer demand for our service offerings, may impose additional burdens on us, or could cause us to incur additional expenses or alter our business model. Some jurisdictions have adopted regulations governing the provision of internet access service. Substantial uncertainty exists in the United States and elsewhere regarding such provisions. For example, in the United States, a federal appellate court recently prevented new FCC “net neutrality” rules and an associated broadband oversight framework from going into effect, finding that the FCC likely does not have statutory authority to adopt such requirements. As a result, there are no FCC rules currently in effect that prohibit internet service providers from unreasonably restricting, blocking, degrading, or charging for access to certain products and services offered by us and our content partners.
If network operators were to engage in restricting, blocking, degrading, or charging for access, it could impede our growth, result in a decline in our quality of service, cause us to incur additional expense, or otherwise impair our ability to attract and retain users, any of which could harm our business. Several states and foreign countries in which we operate also have adopted or are considering rules governing the provision of internet access. In addition, in some jurisdictions (including the United States), network operators are pursuing proposals that would require or enable them to impose fees on content providers related to delivery of network traffic.
As we expand internationally, government regulation protecting the non-discriminatory provision of internet access may be nascent or non-existent. In those markets where regulatory safeguards against unreasonable discrimination are nascent or non-existent and where local network operators possess substantial market power, we could experience anti-competitive practices that could impede our growth, cause us to incur additional expenses, or otherwise harm our business. Future regulations or changes in laws and regulations (or their existing interpretations or applications) could also hinder our operational flexibility, raise compliance costs, and result in additional liabilities for us, which may harm our business.
If we are found liable for content that is distributed through or advertising that is served through our platform, our business could be harmed.
As a distributor of content, we face potential liability for negligence, copyright, patent, or trademark infringement, public performance royalties or other claims based on the nature and content of materials that we distribute. We rely on the statutory safe harbors, as set forth in the Digital Millennium Copyright Act (the “DMCA”), Section 230 of the Communications Decency Act (“Section 230”) in the United States, and the E-Commerce Directive in Europe, for protection against liability for various caching, hosting, and linking activities. The DMCA, Section 230, and similar statutes and doctrines on which we rely or may rely in the future are subject to uncertain judicial interpretation and regulatory and legislative amendments. Any legislation or court rulings that limit the applicability of these safe harbors could require us to take a different approach toward content moderation on our platform, which could diminish the depth, breadth, and variety of content that we offer, inhibit our ability to generate advertising, or otherwise adversely affect our business.
Moreover, if the rules around these statutes and doctrines change, if international jurisdictions refuse to apply similar protections, or if a court were to disagree with our application of those rules to our business, we could incur liabilities and our business could be harmed. If we become liable for these types of claims as a result of the content that is streamed over or the advertisements that are served through our platform, then our business may suffer. Litigation to defend these claims could be costly and the expenses and damages arising from any liability could harm our business. Our insurance may not be adequate to cover these types of claims or any liability that may be imposed on us.
In addition, regardless of any legal protections that may limit our liability for the actions of third parties, we may be adversely impacted if copyright holders assert claims, or commence litigation, alleging copyright infringement against the developers of apps that are distributed on our platform.
While our platform policies prohibit streaming content on our platform without distribution rights from the copyright holder, and we maintain processes and systems for the reporting and removal of infringing content, in certain instances our platform has been misused by unaffiliated third parties to unlawfully distribute copyrighted content. If content owners or distributors are deterred from working with us as a consequence, it could impair our ability to maintain or expand our business, including through international expansion plans.
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If we fail to maintain effective internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and our stock price may be adversely affected.*
We are required to maintain internal control over financial reporting and to report any material weaknesses in such internal control. Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires that we furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting. This assessment must include disclosure of any material weaknesses identified by our management in our internal control over financial reporting. Our independent registered public accounting firm also attests to the effectiveness of our internal control over financial reporting. If we have a material weakness in our internal control over financial reporting in the future, we may not detect errors on a timely basis, and our financial statements may be materially misstated.
Any failure to maintain internal controls over financial reporting could severely inhibit our ability to accurately report our financial condition or results of operations. If we identify material weaknesses in our internal control over financial reporting, are unable to continue to comply with the requirements of Section 404 in a timely manner, are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our Class A common stock could be adversely affected. In addition, we could become subject to investigations by the SEC, The Nasdaq Global Select Market, or other regulatory authorities, which could require additional financial and management resources.
Our financial results may be adversely affected by changes in accounting principles applicable to us.
The generally accepted accounting principles in the United States are subject to interpretation by the Financial Accounting Standards Board, the SEC, and other bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported results of operations and may even affect the reporting of transactions completed before the announcement or effectiveness of a change. It is difficult to predict the impact of future changes to accounting principles or our accounting policies, any of which could harm our business.
If we fail to comply with the laws and regulations relating to the payment of income taxes and the collection of indirect taxes, we could be exposed to unexpected costs, expenses, penalties, and fees as a result of our noncompliance, which could harm our business.
We are subject to requirements to deduct or withhold income taxes on revenue sourced in various jurisdictions, pay income taxes on profits earned by any permanent establishment (or similar enterprise) of ours that carries on business in various jurisdictions, and collect indirect taxes from our sales in various jurisdictions. The laws and regulations governing the withholding and payment of income taxes and the collection of indirect taxes are numerous, complex, and vary by jurisdiction. A successful assertion by one or more jurisdictions that we were required to withhold or pay income taxes or collect indirect taxes where we did not could result in substantial tax liabilities, fees, and expenses, including substantial interest and penalty charges, which could harm our business.
New legislation that would change U.S. or foreign taxation of international business activities or other tax-reform policies could harm our business.
We earn a portion of our income in foreign countries and, as such, we are subject to tax laws in the United States and numerous foreign jurisdictions. Current economic and political conditions make tax laws and regulations, or their interpretation and application, in any jurisdiction subject to significant change.
Proposals to reform U.S. and foreign tax laws could significantly impact how U.S. multinational corporations are taxed on foreign earnings and could increase the U.S. corporate tax rate. Although we cannot predict whether or in what form these proposals will pass, several of the proposals under consideration, if enacted into law, could have an adverse impact on our effective tax rate, income tax expense, and cash flows.
In addition, both tax policy and tax administration are becoming multilateral. This multilateralism and collaboration among taxing authorities (including the U.S. and many foreign jurisdictions in which we operate) has resulted in proposed new tax measures specifically targeting online commerce, digital services, streaming services, and the remote sale of goods and services. Some of these measures (such as a global corporate minimum tax) require adoption of local legislation consistent with the agreed to multilateral framework. Other measures (such as digital services taxes) have already been implemented but may terminate upon the adoption of multilateral tax rules.
The rapid growth of multilateralism in tax administration means greater sharing of tax information among taxing authorities as well as the likelihood of joint and simultaneous tax audits of companies such as ours who have cross-border business activities in which the tax administrations may have a common or complementary interest. The results of any such audits or related disputes could have an adverse effect on our financial results for the period or periods for which the applicable final determinations are made. For example, we and our subsidiaries are engaged in intercompany transactions across multiple tax jurisdictions. Although we believe we have clearly reflected the economics of these transactions and that the proper local transfer pricing is in place, tax authorities may propose and sustain adjustments that could result in changes that may impact our mix of earnings in countries with differing statutory tax rates.
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Risks Related to Ownership of Our Class A Common Stock
The dual class structure of our common stock concentrates voting control with those stockholders who held our stock prior to our initial public offering, including our executive officers, employees, and directors and their affiliates, and limits the ability of holders of our Class A common stock to influence corporate matters.*
Our Class B common stock has 10 votes per share, and our Class A common stock has one vote per share. Our President and Chief Executive Officer, Anthony Wood, holds and controls the vote of a significant number of shares of our outstanding common stock, and therefore Mr. Wood will have significant influence over our management and affairs and over all matters requiring stockholder approval, including election of directors and significant corporate transactions, such as a merger or other sale of Roku or our assets, for the foreseeable future. If Mr. Wood’s employment with us is terminated, he will continue to have the same influence over matters requiring stockholder approval.
In addition, the holders of Class B common stock collectively will continue to be able to control all matters submitted to our stockholders for approval even if their stock holdings represent less than a majority of the outstanding shares of our common stock. This concentrated control will limit the ability of holders of our Class A common stock to influence corporate matters for the foreseeable future, and, as a result, the market price of our Class A common stock could be adversely affected.
Future transfers by holders of Class B common stock will generally result in those shares converting to Class A common stock, which has the effect, over time, of increasing the relative voting power of those holders of Class B common stock who retain their shares in the long term. As a result of such transfers, as of September 30, 2024, Mr. Wood controls a majority of the combined voting power of our Class A and Class B common stock even though he only owns 12.1% of the outstanding Class A and Class B common stock. As a member of our Board of Directors (our “Board”), Mr. Wood owes a fiduciary duty to our stockholders and must act in good faith in a manner he reasonably believes to be in the best interests of our stockholders.
As a stockholder, even a controlling stockholder, Mr. Wood is entitled to vote his shares in his own interests, which may not always be in the interests of our stockholders generally. This concentrated control could delay, defer, or prevent a change of control, merger, consolidation, or sale of all or substantially all of our assets that our other stockholders support, or conversely this concentrated control could result in the consummation of such a transaction that our other stockholders do not support. This concentrated control could also discourage a potential investor from acquiring our Class A common stock, which has limited voting power relative to the Class B common stock and might harm the market price of our Class A common stock.
We have not elected to take advantage of the “controlled company” exemption to the corporate governance rules for companies listed on The Nasdaq Global Select Market.
The market price of our Class A common stock has been, and may continue to be, volatile, and the value of our Class A common stock may decline.*
The market price of our Class A common stock has been and may continue to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, including:
•actual or anticipated fluctuations in our financial condition, operating results, and key performance metrics;
•changes in projected operational and financial results;
•our loss of key content partners;
•changes in laws or regulations applicable to our products or platform;
•the commencement or conclusion of legal proceedings that involve us;
•actual or anticipated changes in our growth rate relative to our competitors;
•announcements of new products or services by us or our competitors;
•announcements by us or our competitors of significant acquisitions, strategic partnerships, or joint ventures;
•capital-raising activities or commitments;
•additions or departures of key personnel;
•issuance of new or updated research or reports by securities analysts;
•the use by investors or analysts of third-party data regarding our business that may not reflect our financial performance;
•fluctuations in the valuation of companies perceived by investors to be comparable to us;
•the perception that our environmental, social, and corporate governance performance is inadequate compared to that of our competitors;
•sales of our Class A common stock, including short selling of our Class A common stock;
•share price and volume fluctuations attributable to inconsistent trading volume levels of our shares;
•general economic and market conditions; and
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•other events or factors, including those resulting from civil unrest, war, foreign invasions, terrorism, or public health crises, or responses to such events.
Furthermore, the stock markets frequently experience extreme price and volume fluctuations that affect the market prices of equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political, and market conditions such as recessions, elections, interest rate changes, or international currency fluctuations, may negatively impact the market price of our Class A common stock. As a result of such fluctuations, you may not realize any return on your investment in us and may lose some or all of your investment. In addition, we and other companies that have experienced volatility in the market price of their stock have been, and may in the future be, subject to securities class action litigation or derivative litigation. Such litigation could result in substantial costs and divert our management’s attention from other business concerns.
Future sales and issuances of our capital stock or rights to purchase capital stock could result in additional dilution of the percentage ownership of our stockholders and could cause our stock price to decline.
We may issue additional securities in the future and from time to time. Future sales and issuances of our capital stock or rights to purchase our capital stock could result in substantial dilution to our existing stockholders. We may sell or issue Class A common stock, convertible securities, and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time. If we sell any such securities in subsequent transactions, investors may be materially diluted. New investors in such subsequent transactions could gain rights, preferences, and privileges senior to those of holders of our Class A common stock.
Future sales of shares by existing stockholders could cause our stock price to decline.
If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our Class A common stock in the public market, the market price of our Class A common stock could decline. All of our outstanding Class A shares are eligible for sale in the public market, other than shares and stock options exercisable held by directors, executive officers, and other affiliates that are subject to volume limitations under Rule 144 of the Securities Act. In addition, we have reserved shares for future issuance under our equity incentive plan. Our directors, employees, and certain contingent workers are subject to our quarterly trading window, which generally opens at the start of the second full trading day after the public dissemination of our annual or quarterly financial results and closes (i) with respect to the first, second, and third quarter of each year, at the end of the fifteenth day of the last month of such quarter and (ii) with respect to the fourth quarter of each year, at the end of the trading day on the Wednesday before Thanksgiving. These directors, employees, and contingent workers may also sell shares during a closed window period pursuant to trading plans that comply with the requirements of Rule 10b5-1(c)(1) under the Exchange Act. When these shares are issued and subsequently sold, it is dilutive to existing stockholders and the market price of our Class A common stock could decline.
If securities or industry analysts do not publish research or publish unfavorable research about our business or if they downgrade our stock, our stock price and trading volume could decline.
A limited number of equity research analysts provide research coverage of our Class A common stock, and we cannot assure you that such equity research analysts will adequately provide research coverage of our Class A common stock. A lack of adequate research coverage may adversely affect the liquidity and market price of our Class A common stock.
If securities or industry analysts cover our company and one or more of these analysts downgrades our stock or issues other unfavorable commentary or research, the price of our Class A common stock could decline. If one or more equity research analysts cease coverage of our company, or fail to publish reports on us regularly, demand for our stock could decrease, which in turn could cause our stock price or trading volume to decline.
We incur costs and demands upon management as a result of complying with the laws and regulations affecting public companies in the United States, which may harm our business.
As a public company listed in the United States, we incur significant legal, accounting, and other expenses. In addition, changing laws, regulations, and standards relating to corporate governance and public disclosure, including SEC and The Nasdaq Global Select Market regulations, may increase legal and financial compliance costs and make some activities more time-consuming. These laws, regulations, and standards are subject to varying interpretations and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. We invest resources to comply with evolving laws, regulations, and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If, notwithstanding our efforts, we fail to comply with new laws, regulations, and standards, regulatory authorities may initiate legal proceedings against us, and our business may be harmed.
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Failure to comply with these rules might also make it more difficult for us to obtain certain types of insurance, including director and officer liability insurance, and we might be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our Board, on committees of our Board, or as members of senior management.
We do not intend to pay dividends in the foreseeable future.*
We have never declared or paid any cash dividends on our Class A or Class B common stock and do not intend to pay any cash dividends in the foreseeable future. We anticipate that we will retain all of our future earnings to grow our business and for general corporate purposes. Moreover, our Credit Agreement contains prohibitions on the payment of cash dividends on our capital stock. Accordingly, investors must rely on sales of their Class A common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.
Provisions of our charter documents and Delaware law may prevent or frustrate attempts by our stockholders to change our management or hinder efforts to acquire a controlling interest in us, and the market price of our Class A common stock may be lower as a result.
There are provisions in our certificate of incorporation and bylaws that may make it difficult for a third party to acquire, or attempt to acquire, control of our company, even if a change in control was considered favorable by our stockholders. Our charter documents also contain other provisions that could have an anti-takeover effect, such as:
•establishing a classified Board so that not all directors are elected at one time;
•permitting our Board to establish the number of directors and fill any vacancies and newly created directorships;
•providing that directors may only be removed for cause;
•prohibiting cumulative voting for directors;
•requiring super-majority voting to amend some provisions in our certificate of incorporation and bylaws;
•authorizing the issuance of “blank check” preferred stock that our Board could use to implement a stockholder rights plan;
•eliminating the ability of stockholders to call special meetings of stockholders;
•prohibiting stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; and
•reflecting our two classes of common stock as described above.
Moreover, because we are incorporated in Delaware, we are governed by Section 203 of the Delaware General Corporation Law, which prohibits a person who owns 15% or more of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner. Any provision in our certificate of incorporation or our bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock and could affect the price that some investors are willing to pay for our Class A common stock.
Our certificate of incorporation provides that the Delaware Court of Chancery and the U.S. federal district courts will be the exclusive forums for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Our certificate of incorporation provides that the Delaware Court of Chancery is the exclusive forum for the following types of actions or proceedings under Delaware statutory or common law:
•any derivative action or proceeding brought on our behalf;
•any action asserting a breach of fiduciary duty;
•any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our certificate of incorporation, or our bylaws; and
•any action asserting a claim against us that is governed by the internal affairs doctrine.
This provision would not apply to suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all Securities Act actions. Accordingly, both state and federal courts have jurisdiction to entertain such claims.
To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our certificate of incorporation provides that the U.S. federal district courts will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
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While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions. In such instance, we would expect to vigorously assert the validity and enforceability of the exclusive forum provisions of our certificate of incorporation. This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions.
These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for certain disputes with us or our directors, officers, or other employees, which may discourage lawsuits against us and our directors, officers, and other employees. If a court were to find either exclusive forum provision in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving such action in other jurisdictions, all of which could harm our business.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Insider Trading Arrangements
During the three months ended September 30, 2024, the following officers (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
Name Action Adoption/Termination Date Trading Arrangement Total Shares of Class A Common Stock to be Sold Expiration Date
Rule 10b5-1*Non-Rule 10b5-1**
Anthony Wood***
(Chief Executive Officer, President, and Chairman)
AdoptionSeptember 11, 2024X300,000 June 9, 2025
___________________
* Contract, instruction or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act.
** “Non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K under the Exchange Act.
*** Trading arrangement adopted by The Wood Revocable Trust, of which Mr. Wood and his spouse are co-trustees.
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Item 6. Exhibits
  Incorporation by reference
Exhibit
Number		DescriptionFormSEC File No.ExhibitFiling DateFiled Herewith
      
3.18-K001-382113.110/3/2017
3.2S-1/A333-2203183.49/18/2017
4.1
Reference is made to Exhibits 3.1 through 3.2.
    
4.2S-1/A333-2203184.19/18/2017
10.18-K001-3821110.1
9/17/2024
10.2
8-K
001-38211
10.19/26/2024

31.1   X
31.2    X
32.1*    X
32.2*    X
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The following information from Roku, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 formatted in Inline XBRL (Extensible Business Reporting Language) includes (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Income (Loss), (iv) the Condensed Consolidated Statements of Cash Flows, and (v) Notes to Condensed Consolidated Financial Statements.
    X
104
Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)
    
X
* These exhibits are furnished with this Quarterly Report and are not deemed filed with the Securities and Exchange Commission and are not incorporated by reference in any filing of Roku, Inc. under the Securities Act of 1933, as amended, or the Securities and Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language contained in such filings.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Quarterly Report to be signed on its behalf by the undersigned thereunto duly authorized.
 Roku, Inc.
   
Date: October 31, 2024
By:/s/ Anthony Wood
  Anthony Wood
  
President, Chief Executive Officer and Chairman
(Principal Executive Officer)
   
Date: October 31, 2024
By:/s/ Dan Jedda
  Dan Jedda
  
Chief Financial Officer
(Principal Financial Officer)
Date: October 31, 2024
By:/s/ Matthew Banks
Matthew Banks
Vice President, Corporate Controller and Chief Accounting Officer
(Principal Accounting Officer)
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