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

By Tim Peterson

Roku’s connected TV platform business grew across the board in the third quarter of 2021, including a return to sequential growth in the amount of time people spent streaming video on Roku-powered devices. That’s especially a good thing as the company’s dealings with streaming services are reportedly getting more contentious and its legacy hardware business grapples with supply chain challenges.

The key numbers:

$680 million in total revenue, up 51% year over year
$582.5 million in platform revenue, up 82% year over year
$97.4 million in player revenue, down 26% year over year
56.4 million active accounts, up 23% year over year
18 billion hours worth of video streamed through Roku, up 21% year over year
Average revenue per user of $40.10, up 49% year over year

An expanding platform business

More than a year after the pandemic-induced streaming surge sent Roku’s CTV platform business skyrocketing, the company was able to (somewhat) maintain that trajectory in Q3 2021, according to the company’s latest quarterly earnings report released on Nov. 3.

During the third quarter, Roku’s platform revenue — which includes the money it receives from selling ads across its CTV platform as well as from its cut of streamers’ subscription sales — increased by 82% year over year. That increase appears to be driven not only by a 23% year-over-year increase in its account base to 56.4 million active accounts — with the addition of 1.3 million accounts during Q3 2021 — but a rise in the amount of time people spent streaming shows, movies and videos on its platform.

From July through September, people spent 18 billion hours streaming video on Roku’s platform, a 21% increase year over year and, notably, a 3% increase from Q2 2021. That sequential increase may seem relatively minor, but it’s significant because Roku had seen streaming watch time slip in Q2 2021 versus Q1 2021.

In Roku’s letter to shareholders, the company said that the average daily streaming watch time per account in Q3 was 3.5 hours, which it described as “consistent with Q2 2021 and slightly higher than Q3 2019.”

Additionally, how people are spending that time on Roku’s platform seems to be diversifying. In the U.S. during Q3 2021, the share of time people spent streaming services outside of the top 10 most-watched streamers on Roku’s platform increased by 5%, though the company did not state what share of total streaming watch time those services represented.

Roku’s streaming watch time may take a hit next month if its current standoff with YouTube leads to Google pulling its popular streaming video service from Roku’s platform when its current deal expires on Dec. 9. Additionally, Roku is reportedly on the verge of a distribution standoff with Amazon, which centers around the latter’s free, ad-supported IMDb TV streamer but could pull in its popular Prime Video service, according to The Information.

During a call with reporters on Nov. 3 after Roku released its latest earnings report, the company’s svp and …read more

Source:: Digiday