Can Rising Streaming Hours Translate Into Revenue Gains for Roku?

Roku’s ROKU surge in streaming hours has presented a compelling monetization opportunity, with engagement trends expected to drive platform revenue growth in the coming quarters. In the second quarter of 2025, total streaming hours came in at 35.4 billion, reflecting an increase of 5.2 billion hours from the year-ago period. The Roku Channel was a major driver, with hours nearly 80% higher year over year, while retaining its rank as the #2 app on the platform by engagement. According to Nielsen, it represented 5.4% of all U.S. TV streaming time. Roku’s upcoming holiday slate — including Jingle Bell Wedding and Merry Little Mystery — is projected to support engagement momentum, alongside pipeline content such as Honest Renovations: A Holiday Makeover, Tightrope!, Tracee Travels and What Drives You with John Cena.

Increased viewing has been tied to expanded advertising inventory, with incremental demand expected through integrations with Amazon DSP and Wurl, and the launch of Roku Ads Manager for small and mid-sized businesses. Sports programming is also positioned to add hours, with the Roku Sports Channel carrying events such as MLB Sunday Leadoff, Formula E, NBA G League and the X Games, plus Bassmaster and Pro Volleyball coverage.

The Zacks Consensus Estimate for the third quarter 2025 streaming hours is pegged at 37.03 billion, indicating growth of 15.8% over the year-ago quarter’s reported figure. While the consensus mark for platform revenues is pegged at $1.05 billion, indicating growth of 15.5% over the year-ago quarter’s reported figure. Whether rising engagement can be consistently translated into sustained revenue growth remains the key variable shaping Roku’s platform performance.

ROKU Faces Stiff Competition

Netflix NFLX continues to lead global streaming hours through premium originals, but unlike Roku, Netflix monetizes primarily through subscription pricing rather than advertising. Rising hours strengthen retention for Netflix, whereas higher engagement on Roku directly expands ad inventory. Amazon AMZN, through Fire TV, also emphasizes streaming hours, with Amazon using retail data to enhance advertising effectiveness. However, Roku holds an advantage in the U.S. market, where its platform economics tie viewing hours more directly to platform revenues. For Amazon, engagement supports broader ecosystem value, while for Roku, it remains a core monetization driver.

ROKU’s Share Price Performance, Valuation and Estimates

ROKU shares have jumped 29.9% year to date, underperforming the Zacks Broadcast Radio and Television industry’s growth of 27.4% but outperforming the Zacks Consumer Discretionary sector’s return of 11.5%.

ROKU’s YTD Price Performance

From a valuation standpoint, Roku stock is currently trading at a forward 12-month Price/Sales ratio of 2.85X compared with the industry’s 4.82X. ROKU has a Value Score of D.

ROKU Valuation

The Zacks Consensus Estimate for third-quarter 2025 earnings is pegged at 7 cents per share, which is up by 4 cents over the past 30 days, indicating a significant improvement over the year-ago quarter’s loss of 6 cents per share.

Roku currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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