Roku racks up record revenues in 2020 | Major Businesses | Business | News | Rapid TV News
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Professing its absolute belief that all television will be streamed and that its mission will continue to be to create a virtuous cycle connecting a TV ecosystem of viewers, content publishers, and advertisers, Roku has announced an unprecedented year for income generation in both its last financial year and fourth quarter of 2020.
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The online video platform provider said that it had benefited from the overwhelming trend in 2020 for consumers to spend more time at home due to the Covid-19 pandemic, and streaming continued to gain momentum. These factors were said to have contributed to strong active account growth, especially in Q2 and Q3, and for the company to add over the year over 14 million active accounts, ending 2020 with 51.2 million active accounts. Attempting to put its scale in growth into perspective, Roku noted that its current active US account base was now more than twice the number of the video subscribers of the biggest cable company in the country.

The tangible financial result of this growth was that Roku achieved record revenue, gross profit and adjusted EBITDA, as consumers and the TV industry continued this shift to streaming. Despite the pandemic-related advertising slowdown in the US, the company saw Q4 monetised video advertising impressions more than doubling year-over-year, as advertisers increasingly followed users from traditional pay-TV to streaming.

As 2020 saw prominent content publishers reorient toward TV streaming, further expanding the content selection for users, Roku’s streaming hours increased by 20.9 billion hours over the year to a record 58.7 billion. The company added that in 2020, 38% of all smart TVs sold in the US were Roku TV models.

The net result of these dynamics was that Roku’s total net revenue climbed 58% year-on-year to $1.778 billion million with platform revenue soaring 71% annually to $1.268 billion. Gross profit was up 63% compared with the end of 2019 to $808 million with average revenue per user (ARPU) climbing $5.62 YoY to $28.76 over the last twelve months.

Commenting on the annual and fourth quarter results, Roku founder and CEO Anthony Wood and CFO Steve Louden described 2020 a pivotal year to start the streaming decade as pandemic related disruptions served as a catalyst in the fundamental shift to TV streaming and demonstrated the power of our strategy, technology, and execution. They said: “Our strategy and execution are working well, and we are seeing the results in our financial performance, our continued position as America’s No. 1 TV streaming platform by streaming hours, and our early international successes. Our purpose-built platform for TV streaming offers superior outcomes for the entire ecosystem – including users, content publishers, and advertisers. We will continue to invest in innovation and growth, and are looking forward to a successful 2021.”

However, the executives warned in the annual results that in 2021 year-over-year comparisons would likely be “quite volatile. While Roku anticipated in the first half of the year strong financial performance as compared to the first half of 2020, in the second half of the year it expected what it thought would be “much tougher” comparisons due to the strength of its second half of 2020, and the third quarter in particular, as consumer interest in streaming surged and monetisation efforts rebounded from slower Q2 growth levels. In all for the full year of 2021, Roku warned that overall year-over-year revenue growth would fall below levels it expected to see in the first and second quarters of 2021.