Roku, Inc.

This is our first report on streaming major, Roku. The company had a strong first quarter of 2022 with Platform revenue up 39% yearly, driven by increased content distribution and advertising revenue. The strength of their business model is confirmed by this financial performance and ongoing growth, even in a difficult operating environment. The Roku platform has been designed from the ground up to function at the heart of TV streaming, satisfying the requirements of every player in the ecosystem. With reliable discovery tools, the company gives users a great experience to find and watch content how they want, whether through subscription or ad-supported services. During the quarter, they collaborated with NBCUniversal Local to bring a number of NBC local news channels to The Roku Channel. They also partnered with Walmart to offer interactive ads to Roku users. As one of the industry’s top platforms for streaming TV, the company anticipates long-term growth in active users and platform revenue. Additionally, the team believes that their growth will be fueled by the tremendous value they offer to users, content owners, and advertisers. We initiate coverage on Roku with a ‘Hold’ rating.