01—Abstract
Summary
Summary of the 10-Q filed May 2, 2025. Cited figures are marked; the original filing is the authoritative source.
Roku, Inc. reported first-quarter 2025 results in this Form 10-Q for the quarter ended March 31, 2025.
Total net revenue rose to $1,020.7 milliona from $881.5 million, an increase of 16%, driven by Platform revenue of $880.8 million (up 17%) on higher streaming services distribution revenue and advertising. Devices revenue was $139.9 million (up 11%), with a devices gross loss of $19.3 million. Net loss narrowed to $27.4 million, or $0.19 per share, from $50.9 million, or $0.35 per share, a year earlier, and loss from operations improved to $57.7 million from $72.0 million.
Adjusted EBITDA, a non-GAAP measure, was $56.0 millionb versus $40.9 million. Cash flow and liquidity remained solid. Operating activities provided $138.7 million in the quarter, and cash and cash equivalents stood at $2,256.2 million at March 31, 2025.
Trailing-twelve-month Free Cash Flow, a non-GAAP measure, was $298.4 millionc, down from $426.8 million. The company had not borrowed under its $300.0 million revolving Credit Agreement, which matures in September 2029. Streamed hours reached 35.8 billion, up 16%.
The filing also discloses a subsequent event: an April 30, 2025 agreement to acquire Frndly TV, Inc. for a total purchase price of $185 milliond in cash, including $75 million held back and payable upon achievement of certain metrics over two years, with closing expected in the second quarter of 2025. Customer concentration remains notable, with Amazon, Best Buy, Target and Walmart accounting for 87% of devices revenue in the quarter.
02—Key points
Key Highlights
- Total net revenue of $1,020.7 million, up 16% from $881.5 million in Q1 2024.
- Platform revenue of $880.8 million, up 17%, driven by higher streaming services distribution revenue and advertising; Platform represented 86% of total net revenue.
- Devices revenue of $139.9 million, up 11%, but devices gross loss widened to $19.3 million from $6.1 million as Roku-branded TVs carried a higher share of device sales.
- Net loss narrowed to $27.4 million ($0.19 per share) from $50.9 million ($0.35 per share), helped by an income tax benefit of $13.1 million.
- Adjusted EBITDA (non-GAAP) of $56.0 million versus $40.9 million; Free Cash Flow (TTM, non-GAAP) of $298.4 million versus $426.8 million.
- Cash and cash equivalents of $2,256.2 million; no borrowings under the $300.0 million revolving Credit Agreement as of March 31, 2025.
- Agreed on April 30, 2025 to acquire Frndly TV, Inc. for $185 million in cash, including $75 million held back subject to performance milestones.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q1 FY2025, Roku lost $0.03.
- Revenue$1.02B100.0%
- Cost of revenue−$575.6M56.4%
- Gross profit$445.0M43.6%
- Operating costs−$502.8M49.3%
- Operating income−$57.7M5.7%
- Interest, other & tax$30.3M3.0%
- Net income−$27.4M2.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed May 2, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $1.02B$881.47M | +15.8% |
| Cost of Revenue | $575.63M$493.18M | +16.7% |
| Gross Profit | $445.05M$388.29M | +14.6% |
| R&D Expenses | $184.58M$180.46M | +2.3% |
| Operating Expenses | $502.77M$460.33M | +9.2% |
| Operating Income | -$57.73M-$72.04M | +19.9% |
| Net Income | -$27.43M-$50.85M | +46.1% |
| EPS (Basic) | $-0.19$-0.35 | +45.7% |
| EPS (Diluted) | $-0.19$-0.35 | +45.7% |
| Shares Outstanding (Basic) | 146.20M143.75M | +1.7% |
| Shares Outstanding (Diluted) | 146.20M143.75M | +1.7% |
05—Questions
Frequently Asked Questions
How did Roku's revenue and profitability perform in the first quarter of 2025?
Total net revenue rose 16% to $1,020.7 million. Loss from operations improved to $57.7 million from $72.0 million, and net loss narrowed to $27.4 million from $50.9 million. Adjusted EBITDA, a non-GAAP measure, increased to $56.0 million from $40.9 million.
What drove growth in Platform revenue?
Platform revenue increased $125.9 million, or 17%, to $880.8 million. The filing attributes the increase primarily to higher revenue from streaming services distribution, specifically increased revenue share on content subscriptions and higher Premium Subscriptions revenue, along with higher advertising revenue, despite continued weakness in the media and entertainment vertical.
Why did the devices segment post a larger gross loss?
The devices gross loss increased $13.2 million to $19.3 million, which the filing states was primarily driven by Roku-branded TVs representing a higher proportion of device sales. Cost of revenue, devices rose 20%, including $17.4 million in higher manufacturing costs and $13.0 million in higher freight costs.
What is Roku's liquidity position and debt situation?
Cash and cash equivalents were $2,256.2 million at March 31, 2025. The company had not borrowed against its Credit Agreement, which provides a $300.0 million revolving facility maturing September 16, 2029, and had $39.7 million of outstanding letters of credit secured by it. Operating activities provided $138.7 million of cash in the quarter.
What is the Frndly TV acquisition and what does it involve?
On April 30, 2025, Roku agreed to acquire Frndly TV, Inc., a subscription streaming service offering live TV, on-demand video and cloud-based DVR. The total purchase price is $185 million in cash, including $75 million held back and payable upon achievement of certain financial and operating metrics over the two years following closing. The company expects the transaction to close in the second quarter of 2025.
06—Continue