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美國
證券交易委員會
華盛頓特區20549
表格 10-Q
（標記一）
☒根據1934年證券交易法第13或15(d)節的季度報告
截至季度結束日期的財務報告2024年9月30日
或
☐根據1934年證券交易法第13或15(d)節的轉型報告書
過渡期從 至
委託文件編號：001-39866001-38211
Roku, Inc.
（註冊人的確切姓名，如其章程中指明）
特拉華州26-2087865
(所在州或其他司法管轄區)
成立或組織的州）
（IRS僱主
唯一識別號碼）
科爾曼大道 1173 號
聖何塞, 加州 95110
(主要執行辦公室地址，包括郵遞區號)
註冊人的電話號碼，包括區號：(408) 556-9040
在法案第12(b)條的規定下注冊的證券：
每個類別的標題：交易標的：註冊的交易所名稱：
A類普通股，每股面值$0.0001ROKU逐筆明細納斯達克全球精選市場
請勾選以下選項以指示註冊人是否在過去12個月內(或在註冊人需要提交此類報告的較短時間內)已提交證券交易法1934年第13或15(d)條所要求提交的所有報告，並且在過去90天內已受到此類報告提交要求的影響。是根據交易所法規12b-2中「大型加速文件報告人」，「加速文件報告人」，「小型報告公司」和「新興增長公司」的定義，請勾選發行人是否爲大型加速文件報告人。
請勾選方框，以表明註冊人是否在過去12個月內（或其要求提交此類文件的較短期限內）提交了每份交互式數據文件，其提交是根據規則405號第S-T條（本章第232.405條）要求提交的。是根據交易所法規12b-2中「大型加速文件報告人」，「加速文件報告人」，「小型報告公司」和「新興增長公司」的定義，請勾選發行人是否爲大型加速文件報告人。
請勾選標記以說明註冊人是大型快速申報人、加速申報人、非加速申報人、較小的報告公司還是新興成長型公司。請查看《交易所法》第120億.2條中「大型快速申報人」、「加速申報人」、「較小的報告公司」和「新興成長型公司」的定義。
大型加速存取器☒加速文件提交人☐
非加速文件提交人☐ 較小的報告公司☐
新興成長公司☐  
如果是新興成長型企業，請在以下選項中打勾，指明註冊人是否選擇不使用擴展的過渡期來符合根據《證券交易法》第13（a）節規定提供的任何新的或修訂後財務會計準則的要求。☐
請勾選以下選項以指示註冊人是否爲外殼公司(根據交易所法規則12b-2定義)。是☐否 ☒
截至2024年9月30日，登記人持有 127,893,163 A類普通股$0.0001面值每股，以及 17,306,064 B類普通股$0.0001面值每股，均為待發行。

目錄
目錄
  頁面
第一部分。
项目1。
 
 
 
 
 
项目2。
项目3。
项目4。
第二部分。
项目1。
项目1A。
项目2。
项目3。
项目4。
项目5。
第6項。
i
目錄
精選名詞詞彙表
在本第10-Q季度報告（“季度報告”）中使用時，除非上下文另有要求，對以下術語的引用具有如下所定義的相應含義。
活躍的帳戶： 查看串流家庭。
廣告支持的點播視訊（AVOD）： 透過廣告支持的串流內容，不向觀眾收取費用。
應用程式： 主要指的是在Roku平台上直接對消費者提供的串流應用程式（例如The Roku Channel或奈飛）。我們也使用“應用程式”來指代移動應用程式（例如我們的Roku智能家居應用程式）。
每用戶平均營業收入（ARPU）： 控制項營業收入為過去四個季度之和，除以當前期末及前一年相應期末的Streaming Households數量平均值。請參閱本季度報告中第一部分第2項“管理層討論和分析財務條件和營運結果”，了解主要績效指標和非GAAP財務指標的詳細信息。
DSP: 需求方平台（例如Roku的OneView廣告購買平台），允許數位廣告庫存的買家透過一個介面管理多個廣告交易所和數據交換帳戶，跨多個平台。
FAST： 免費、廣告支持的線性串流電視，不包含按需內容。
授權的Roku TV合作夥伴： 電視原始設備製造商（“OEMs”）授權Roku作業系統並利用我們的智能電視參考設計來製造電視。
線性電視： 一種按特定時間表提供編排節目的電視格式。
高級訂閱： 透過The Roku Channel提供的內容合作夥伴（例如Paramount）提供的基於訂閱的流媒體服務。
羅姆牌電視： 由Roku設計、製造和銷售，並搭載Roku OS的電視。羅姆牌電視包括Roku Select、Roku Plus和Roku Pro系列電視。
Roku主界面： 當觀衆使用Roku流媒體設備開始流媒體時，首先看到的是第一個屏幕。當按下Roku遙控器上的主頁按鈕或退出應用程序時，觀衆也將返回主屏幕。
Roku主畫面選單： Roku主畫面左側導覽列。
Roku原創節目： 由Roku創建的原創內容節目。
Roku作業系統： Roku作業系統是專為電視而打造，並驅動Roku串流媒體裝置。
Roku支付: 我們的計費服務允許流媒體用戶保存支付方式，以便在Roku平台上購買時不必重新輸入付款信息。它還使用戶能夠註冊某些基於訂閱的流媒體服務（包括高級訂閱服務）。
Roku電視型號： 由我們授權的Roku電視合作夥伴製造和銷售的由Roku OS提供動力的電視。
串流： 透過互聯網分發視頻、音樂或其他媒體內容。
串流媒體裝置： 任何可進行串流的裝置。對於 Roku，這包括 Roku 串流播放器、Roku 電視機型和 Roku 品牌的電視。
串流時數： 在特定時期，串流設備在Roku串流平台上串流內容的總時數。有關詳細信息，請參閱本季度報告中第一部分第2項《管理層討論與分析》中的財務狀況和營運結果、關鍵績效指標和非依據通用會計準則的指標。
流媒體用戶（以前是活躍帳戶）： 在過去30天內在我們平台上串流內容的不同使用者帳戶數。我們以前將「流媒體用戶」稱為「活躍帳戶」。雖然我們已將此術語更改為更能反映我們業務性質的術語，但我們仍使用計算「活躍帳戶」時使用的相同方法來計算。詳細內容請參見本季度報告中第I部分第2項《管理層的討論與分析》的財務狀況和業務營運結果、主要績效指標和非依照通用會計準則衡量的指標。
流媒體平台： 透過互聯網連接將觀眾體驗和流媒體應用程序（例如Roku頻道和奈飛）傳送到用戶的電視的技術。
串流播放器： 透過HDMI連接到電視，使電視能夠串流播放的設備（例如Roku Express、Roku Express 0.4萬、Roku Streaming Stick 0.4萬、Roku Ultra、Roku Streambar和Roku Streambar Pro）。
智能電視： 一種透過作業系統（例如，Roku OS）連接到互聯網的電視。
訂閱視訊點播（SVOD）： 即時串流內容可按需觀看，需付費訂閱，並可有廣告支持或無廣告。
電視串流： 在電視上通過互聯網串流內容的行為。
The Roku Channel: Roku擁有和營運的流媒體概念。The Roku Channel在The Roku Channel應用程式中整合了三種類型的內容——AVOD，FASt和高級訂閱——並通過整合在Roku平台上的觀看體驗（例如，在Roku首頁屏幕選單上的直播電視）來聚合這些內容。
ii
目錄
關於前瞻性陳述的備註
本季報告中包含根據1933年證券法（經修訂的“證券法”）第27條和1934年證券交易法（經修訂的“交易所法”）第21E條所披露的有關我們和我們行業的前瞻性陳述，涉及重大風險和不確定性。本季報告中除歷史事實陳述外的所有陳述，包括有關我們未來營運業績和財務狀況、業務策略和管理層對未來營運的計劃和目標的陳述，均屬前瞻性陳述。在某些情況下，前瞻性陳述可通過“旨在”、“預計”、“相信”、“持續”、“可能”、“設計”、“開發”、“估計”、“預期”、“打算”、“可能性”、“預測”、“項目”、“應該”、“將”、“將會”、“目標”或這些術語的否定形式或其他類似的表達方式來辨識。我們提醒您，前述可能不包含本季報告中提出的所有前瞻性陳述。
前瞻性聲明基於我們管理層的信念和假設以及目前可用的信息。這些前瞻性聲明受到許多已知和未知的風險、不確定因素和假設的影響，包括本季度報告中標題為“風險因素”部分以及其他地方描述的風險，涉及等事項：
•我們的財務表現，包括我們的營業收入、營業成本、營業費用、盈利能力，以及我們的關鍵績效指標（包括串流家庭、串流時數、ARPU和自由現金流）；
•宏觀經濟條件、不確定性和地緣政治衝突對我們的業務、運營、以及我們和廣告商、內容合作夥伴、授權 Roku 電視合作夥伴、其他設備許可方、製造商、供應商、零售商和觀眾所在的市場和社區產生的影響;
•我們吸引和留住觀眾，增加串流時數的能力；
•我們能夠吸引和保留購買The Roku Channel視頻廣告庫存、我們通過串流服務發行協議獲取的平台上的其他視頻廣告庫存以及蘋果-顯示屏和屏幕保護程式上的本地顯示廣告的廣告商才能。
•我們吸引和留住電視品牌、製造業合作夥伴和服務運營商授權和部署我們的技術的能力；
•我們在流媒體平台上生產或取得流行內容發行權利的能力，或以有利條款進行，或根本無法進行，包括與內容合作夥伴續簽現有協議；
•電視收視習慣的變化和電視流媒體的增長；
•我們相關市場的增長，包括電視串流平台廣告支出的增長，以及我們成功在這些市場上發展業務的能力；
•我們對不斷變化的市場條件和技術發展的適應能力；
•我們有能力開發和推出新產品，並提供附屬服務和支援；
•我們整合所收購的企業、產品和技術的能力；
•我們有能力將我們的產品和服務擴展到相鄰市場，在這些市場擴大我們的業務規模，並長期以來實現盈利。
•我們有競爭效力，能夠有效地與現有競爭對手和新市場進入者競爭；
•我們成功管理國內和國際擴張的能力；
•我們吸引和留住合格員工和關鍵人員的能力；
•我們能夠應對涉及我們產品、系統和運營的潛在和實際網絡安全概念事件和系統故障；
•我們維護、保護和加強我們的知識產權的能力；
•我們獲得融資的能力是否有利條件，或者根本無法獲得；
•我們能夠管理產品的銷售價格，以增加串流家庭；並
•我們有能力遵守目前適用或可能適用於我們業務的法律和法規，無論是在美國還是國際上，包括遵守隱私和數據保護法規。
財報的其他板塊可能包括可能損害我們業務和財務表現的額外因素。此外，我們在一個競爭激烈且快速變化的環境中運營。新的風險因素不時浮現，我們的管理層無法預測所有風險因素，也無法評估所有因素對我們業務的影響，或任何因素或多個因素可能導致實際結果與任何前瞻性陳述中包含的結果不同，或被其暗示。
您不應當將展望性陳述視為未來事件的預測。我們無法保證展望性陳述中所反映的事件和情況將會實現或發生。雖然我們認為展望性陳述中所反映的期望是合理的，但我們無法保證未來的結果、活動水平、表現或成就。除非法律要求，我們不承擔在本季度報告日期之後基於任何原因公開更新任何展望性陳述的義務，也不使這些陳述符合實際結果或我們期望的變化。您應當閱讀這份季度報告，以及引用並作為本季度報告附件提交的文件，明白我們的實際未來結果、活動水平、表現和成就可能與我們的預期大不相同。我們通過這些警語陳述來限制所有我們的展望性陳述。
投資者及其他人員應注意，我們可能會使用我們的投資者關係網站（roku.com/investor）、我們的博客（roku.com/blog）、美國證券交易委員會（"SEC"）的申報、網絡廣播、新聞稿和電話會議來公告重要的業務和財務信息給我們的投資者。我們使用這些媒介來與投資者和公眾溝通我們公司、產品和服務以及其他議題。我們提供的信息可能被視為重要信息。因此，我們鼓勵投資者、媒體和對我們公司感興趣的其他人員查閱我們在投資者關係網站上發佈的信息。Roku、Roku標誌以及本報告中出現的其它Roku的商標、商號或服務標誌為Roku的財產。本報告中出現的其它公司的商標、商號和服務標誌為各自持有人的財產。
iii
目錄
第一部分 - 財務資訊
項目1. 基本報表
ROKU, INC.
縮短的合併資產負債表
(以千為單位，除每股面值資料外)
(未審核)
 截至
 2024年9月30日2023年12月31日
資產
流動資產：
現金及現金等價物$2,126,974 $2,025,891 
結餘應收帳款$38,143 15.134,127 截至2024年6月30日。
729,911 816,337 
分別為2023年12月31日和2024年9月30日
存貨191,213 92,129 
預付費用及其他流動資產138,332 138,585 
全部流動資產3,186,430 3,072,942 
物業及設備，扣除折舊後淨值222,999 264,556 
營運租賃權使用資產314,326 371,444 
內容資產淨值247,379 257,395 
無形資產，扣除累計攤銷31,026 41,753 
商譽161,519 161,519 
其他非流動資產139,737 92,183 
總資產$4,303,416 $4,261,792 
550,714
當前負債：
應付賬款$327,038 $385,330 
應付負債820,165 788,040 
流動部分递延收入93,405 102,157 
流動負債合計1,240,608 1,275,527 
非流動營收項目23,267 24,572 
非流動租賃負債535,378 586,174 
其他長期負債43,653 49,186 
總負債1,842,906 1,935,459 
承諾及不確定事項（附註12）
股東權益：
0.010.0001 每股面值 $
15 14 
資本公積額額外增資3,851,967 3,623,747 
其他綜合損益（損失）累積額(47)159 
累積虧損(1,391,425)(1,297,587)
股東權益總額2,460,510 2,326,333 
負債總額和股東權益總額$4,303,416 $4,261,792 
請參閱附註的基本財務報表。
1
目錄
ROKU，股份有限公司。
經簡化的合併利潤及損失表
（以千元爲單位，除每股數據外）
（未經審計）
 三個月已結束 九個月已結束
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
淨收入：
平台$908,175 $786,785 $2,487,443 $2,165,238 
設備154,028 125,233 424,408 334,956 
淨收入總額1,062,203 912,018 2,911,851 2,500,194 
收入成本：
平台416,396 408,554 1,161,416 1,057,151 
設備165,732 134,641 457,369 358,352 
總收入成本582,128 543,195 1,618,785 1,415,503 
毛利（虧損）：
平台491,779 378,231 1,326,027 1,108,087 
設備(11,704)(9,408)(32,961)(23,396)
毛利總額480,075 368,823 1,293,066 1,084,691 
運營費用：
研究和開發178,798 282,201 534,738 694,673 
銷售和營銷237,047 307,694 660,827 768,805 
一般和行政99,993 128,717 276,543 309,422 
運營費用總額515,838 718,612 1,472,108 1,772,900 
運營損失(35,763)(349,789)(179,042)(688,209)
其他收入，淨額30,880 22,902 84,955 65,317 
所得稅前虧損(4,883)(326,887)(94,087)(622,892)
所得稅支出（福利）4,147 3,184 (249)8,378 
淨虧損$(9,030)$(330,071)$(93,838)$(631,270)
每股淨虧損——基本虧損和攤薄後$(0.06)$(2.33)$(0.65)$(4.47)
已發行普通股的加權平均值——基本股和攤薄後普通股144,862141,877144,319 141,087 
請參閱附註的基本財務報表。
2
目錄
ROKU, INC.
基本報表綜合損益表
（以千爲單位）
(未經審計)
三個月已結束九個月已結束
2024年9月30日2023年9月30日2024年9月30日2023年9月30日
淨虧損$(9,030)$(330,071)$(93,838)$(631,270)
扣除稅款的其他綜合收益（虧損）：
外幣折算調整614 (237)(206)126 
綜合損失$(8,416)$(330,308)$(94,044)$(631,144)
請參閱附註的基本財務報表。
3
目錄
ROKU，股份有限公司。
股東權益的簡明合併報表
（以千爲單位）
(未經審計)
 普通股
共計
實收資本
累計
其他全面
收益（損失）		累計
赤字		總
股東的
股東權益
2024年9月30日止三個月股份數量
2024年6月30日結餘144,689 $14 $3,773,831 $(661)$(1,382,395)$2,390,789 
根據股權激勵計劃發行的普通股股份852 1 301 — — 302 
股票補償費用— — 100,096 — — 100,096 
股票以用於補繳與淨股份結算相關的稅款(342)— (22,261)— — (22,261)
外幣翻譯調整— — — 614 — 614 
淨虧損— — — — (9,030)(9,030)
截至2024年9月30日的餘額145,199 $15 $3,851,967 $(47)$(1,391,425)$2,460,510 
2024年9月30日止九個月
截至2023年12月31日的餘額143,502 $14 $3,623,747 $159 $(1,297,587)$2,326,333 
根據股權激勵計劃發行的普通股股份2,724 1 8,980 — — 8,981 
股票補償費用— — 283,124 — — 283,124 
股票用於支付與權益獎勵相關的稅款(1,027)— (63,884)— — (63,884)
外幣翻譯調整— — — (206)— (206)
淨虧損— — — — (93,838)(93,838)
餘額-2024年9月30日145,199 $15 $3,851,967 $(47)$(1,391,425)$2,460,510 
 普通股
共計
實收資本
累計
其他全面
收益（損失）		累計
$		總
股東的
股權
2023年9月30日止三個月股份數量
餘額—2023年6月30日141,508 $14 $3,422,415 $71 $(889,225)$2,533,275 
根據股權激勵計劃發行的普通股股份988 — 13,195 — — 13,195 
股票補償費用— — 91,305 — — 91,305 
外幣翻譯調整— — — (237)— (237)
淨虧損— — — — (330,071)(330,071)
2023年9月30日餘額142,496 $14 $3,526,915 $(166)$(1,219,296)$2,307,467 
2023年9月30日止九個月
餘額-2022年12月31日140,027 $14 $3,234,860 $(292)$(588,026)$2,646,556 
根據股權激勵計劃發行的普通股股份2,469 — 14,699 — — 14,699 
股票補償費用— — 277,356 — — 277,356 
外幣翻譯調整— — — 126 — 126 
淨虧損— — — — (631,270)(631,270)
2023年9月30日餘額142,496 $14 $3,526,915 $(166)$(1,219,296)$2,307,467 
請參閱附註的基本財務報表。
4
目錄
ROKU，股份有限公司。
簡明合併現金流量表
（以千爲單位）
(未經審計)
 九個月結束
 2024年9月30日2023年9月30日
經營活動現金流量：
淨虧損$(93,838)$(631,270)
調整爲了將淨虧損調節爲經營活動現金流：
折舊和攤銷47,629 53,047 
股票補償費用283,124 277,356 
攤銷租賃權資產35,674 45,137 
內容資產攤銷和沖銷158,892 154,801 
外幣重估損失674 3,469 
可轉換應收票據中戰略投資公平價值變動(6,978)(3,734)
資產減值29,118 235,165 
應收賬款減值準備2,081 1,977 
其他項目，淨額(2,224)(872)
經營性資產和負債變動:
應收賬款83,828 38,416 
存貨(99,084)1,373 
預付費用和其他流動資產(40,952)16,003 
資產及負債，淨額(141,345)(191,481)
其他非流動資產(19,996)5,448 
應付賬款(57,937)174,784 
應計負債14,044 70,217 
經營租賃負債(45,766)(14,301)
其他長期負債1,866 (910)
遞延收入(10,057)4,904 
經營活動產生的現金流量淨額138,753 239,529 
投資活動現金流量：
購買固定資產(2,603)(79,099)
2,982 (20,000)(10,000)
投資活動產生的淨現金流出(22,603)(89,099)
籌集資金的現金流量：
償還借款— (80,000)
與信用協議相關的發行成本(1,829)— 
根據激勵計劃發行的股權收入8,981 14,699 
與股份獎勵淨結算相關的支付的稅額(63,884)— 
籌集資金淨額(56,732)(65,301)
現金，現金等價物和受限制現金的淨增加額59,418 85,129 
匯率變動對現金、現金等價物及受限制資金的影響2,774 (2,964)
現金、現金等價物和受限制現金—期初2,066,604 1,961,956 
現金、現金等價物和受限現金——期末$2,128,796 $2,044,121 
5
目錄

九個月結束
2024年9月30日2023年9月30日
期末現金、現金等價物和受限現金：
現金及現金等價物$2,126,974 $2,003,408 
限制性現金，流動資產1,822 40,713 
現金、現金等價物和受限現金——期末$2,128,796 $2,044,121 
補充現金流信息披露：
支付的利息現金$106 $886 
支付的所得稅費用$13,235 $5,027 
非現金投資和籌資活動的補充披露:
財產和設備購買的未付餘額$169 $1,129 
請參閱簡明合併基本報表註解。
6
目錄
ROKU，股份有限公司。
壓縮合並財務報表註釋
1. 本公司
業務的組織和描述
Roku公司（以下簡稱「公司」或「Roku」）成立於2002年10月，爲特拉華州法律下的Roku有限責任公司。2008年2月1日，Roku有限責任公司更名爲Roku, Inc.，成爲特拉華州的一家公司。該公司的經營範圍爲 兩個 可報告的業務部門，並通過銷售數字廣告（包括直接和程序化視頻廣告、媒體和娛樂促銷支出以及相關服務）、流媒體服務分發（包括訂閱和交易收入份額、高級訂閱銷售以及遙控器上品牌應用按鈕的銷售）產生平台收入。該公司通過銷售流媒體播放器、Roku品牌電視、智能家居產品和服務、音頻產品以及相關配件，以及與服務運營商的許可安排產生設備收入。
2. 重要會計政策摘要。
報告前提
簡明綜合財務報表已按照美國通常公認會計原則(「U.S. GAAP」)和證券交易委員會(「SEC」)有關中期財務報告的適用規則和法規編制。根據該規則和法規，通常包括於符合U.S.GAAP的財務報表中的特定信息和附註披露已被簡化或省略。這些簡明綜合財務報表應當與公司於2023年12月31日止年度在2024年2月16日向SEC提交的年度報告10-K中的綜合財務報表一起閱讀(「年度報告」)。
截至2023年12月31日的合併資產負債表是根據該日期經審計的合併基本報表得出的，但不包含公司年度報告中包含的所有信息和附註。中期財務信息未經審計，但反映了管理層認爲必要的所有正常經常性調整，以公正地呈現此處所列信息。截至2024年9月30日的三個月和九個月的經營結果不一定能指示全年或任何未來期間的運營結果。
在我們的簡明合併基本報表及相關附註中，某些報告的前期金額已被重新分類，以符合當前期間的展示。
使用估計
根據美國通用會計準則，公司編制的簡明合併基本報表要求管理層做出一些估計、判斷和假設，這些估計、判斷和假設影響報告的資產、負債、營業收入和費用的金額。受此類估計和假設影響的重要項目包括：
•收入確認：確定履行義務的性質和滿足時機，變動對價，確定履行義務的單獨售價，毛收入與淨收入的確認，以及評估客戶與供應商關係；
•無形資產的減值；
•資產的攤銷和內容資產的減值；
•經營租賃使用權資產和物業及設備的減值；
•戰略投資的估值（見註釋7）；
•有形和無形資產的有用壽命;
•銷售退貨和銷售激勵的津貼；和
•遞延所得稅資產的估值。
公司基於歷史經驗和公司認爲在當前情況下合理的各種其他假設來進行估計。實際結果可能與公司的估計和假設有所不同。
7
目錄
合併原則——未經審計的中期簡明合併財務報表包括按照GAAP準備的公司及其全資子公司的帳戶。所有公司間餘額和交易均已經過整合。所有金額都是以百萬爲單位，除了股份和每股股價。
包含了Roku, Inc.及其全資子公司的合併基本報表，已按照美國公認會計原則編制。所有的公司間賬目和交易在合併中已被消除。
現金及現金等價物和受限制現金
公司認爲，所有在購買日具有原始到期日不超過三個月的高流動性投資可視爲現金等價物。現金及現金等價物主要包括銀行存款帳戶和貨幣市場基金投資。
截至2024年9月30日，公司的受限現金餘額爲$1.8 百萬，並計入合併資產負債表中的預付費用和其他流動資產。它用於擔保與辦公設施的經營租賃相關的特定未償付信用證。
公司將其現金、現金等價物和受限制現金存款保持在信用質量高的金融機構，並持續監控對任何一家金融機構的風險敞口金額，並根據需要進行多元化，以減少其集中風險。這些餘額通常超過監管規定的保險限額。
應收賬款淨額
應收賬款通常是無擔保的，來源於從客戶那裏賺取的營業收入。它們按發票價值減去預計的銷售退貨、銷售激勵、可疑賬款和其他雜項準備金而記載。公司對其客戶進行持續的信用評估，以判斷潛在的信用損失和可疑賬款的準備金。公司考慮歷史經驗、持續的促銷活動、歷史索賠率和其他因素來判斷銷售退貨和銷售激勵的準備金。
銷售退貨準備金: 銷售退貨的準備金包括以下活動（以千爲單位）：
 三個月結束 截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
開始餘額$6,376 $7,392 $7,808 $7,417 
添加：計入營業收入3,733 3,881 12,307 12,045 
減：銷售退貨準備金的利用(4,039)(4,058)(14,045)(12,247)
結束餘額$6,070 $7,215 $6,070 $7,215 
銷售激勵津貼: 銷售激勵津貼包括以下活動（以千計）：
 三個月結束  截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
開始餘額$26,641 $17,428 $23,024 $28,903 
加：計入營業收入37,622 16,048 93,655 43,598 
減少：銷售激勵準備金利用(36,292)(19,426)(88,708)(58,451)
結束餘額$27,971 $14,050 $27,971 $14,050 
應收賬款壞帳準備: 壞賬準備金包括以下活動（以千爲單位）：
三個月結束  截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
開始餘額$5,869 $5,578 $2,213 $3,498 
壞賬準備（回收的壞賬）(2,263)(984)2,081 1,977 
沖銷的調整(323)(2,046)(1,011)(2,927)
結束餘額$3,283 $2,548 $3,283 $2,548 
客戶J佔據了 11截至2024年9月30日，公司應收賬款的淨餘額的百分比。公司沒有任何客戶在截至2023年12月31日的應收賬款淨餘額中佔據超過10%。
8
目錄
最近的會計聲明
2023年11月，財務會計準則委員會（「FASB」）發佈了會計準則更新（「ASU」）2023-07，「分段報告」（主題280）：報告段披露的改進，要求公司在年度和中期基礎上提供有關報告段披露的重要細分費用的增強披露。該指南適用於2023年12月15日之後開始的財年和財年內開始於2024年12月15日之後的中期。該指南對財務報表中呈現的所有先前期間進行追溯調整。公司當前正在評估新指南的影響。 分段披露（主題280）-報告分段披露改進這要求公司在其可報告板塊的報告中提供有關重大板塊費用的增強披露。該指導原則適用於2023年12月15日之後開始的財政年度及2024年12月15日之後開始的財政年度的間隔期。該指導原則追溯適用於財務報表中呈現的所有前期。公司目前正在評估新指導原則的影響。
2023年12月，FASB發佈了ASU 2023-09，所得稅（話題 740）- 改進所得稅披露這需要在所得稅披露中逐步增加披露內容，提高所得稅披露的透明度和實用性。更新後的披露主要要求在稅率調和中提供特定類別和更大的細分，分解已支付的所得稅，以及對其他與所得稅相關的披露進行修改。該指引自2024年12月15日後開始的財年起，適用於前瞻性或追溯性。公司目前正在評估新指引的影響。
3. 收入
公司的分解營業收入由第15條討論的可報告部門代表。 二 報告的分部在註釋15中討論。
合同餘額包括以下內容（單位：千元）：
 截至
 2024年9月30日2023年12月31日
應收賬款，淨額$729,911 $816,337 
合同資產（計入預付費用和其他流動資產）7,372 17,964 
遞延收入，當期部分$93,405 $102,157 
遞延收入，非流動部分23,267 24,572 
遞延收入總額$116,672 $126,729 
應收賬款按發票金額記錄，扣除銷售退貨、銷售激勵和可疑賬款的撥備。付款條款可以根據客戶和合同有所不同。
營業收入的確認時機可能與向客戶開票的時機不同。當開票發生在營業收入確認之後時，合同資產就會產生。當開票權利變爲無條件時，合同資產轉移至應收賬款。公司的合同資產本質上是流動的，包含在預付費用和其他流動資產中。合同資產減少了$10.6 在截至2024年9月30日的九個月中，由於向客戶開票的時機，減少了百萬。
總遞延營業收入反映在履行義務和確認營業收入完成之前開具的發票金額。總遞延營業收入減少了$10.1 在截至2024年9月30日的九個月期間，減少了百萬，主要是由於履行義務的時間安排，而受到來自更高的高級訂閱的遞延營業收入增加的抵消。
截至2024年9月30日的三個月和九個月期間確認的營業收入，來自截至2023年12月31日的總遞延收入中的金額爲$10.5 百萬美元和美元92.8 百萬，分別爲。截止2023年9月30日的三個月和九個月期間確認的營業收入，來自截至2022年12月31日的總遞延收入中的金額爲$10.8 百萬美元和美元77.7 百萬，分別爲。
分配給剩餘履約義務的營業收入代表尚未確認的估計合同收入，包括未賺取的收入和將來期間將開具發票並確認爲收入的金額。截至2024年9月30日，這些剩餘履約義務的估計合同收入爲$940.1 百萬，其中公司預計將識別約 57%將在未來的12以下表格總結了以公平價值爲基礎在公平價值層次結構內定期計量的資產類型（以千美元爲單位）:
本公司於2023年12月31日和2022年12月31日的三個月內確認的股權獎勵支出爲12.0 百萬美元和美元15.8 截至2024年9月30日的三個月和九個月，營業收入分別爲百萬美元，並認定$15.8 百萬美元和美元41.8 從合同中認可的在以前期間已履行的績效義務中，分別於截至2023年9月30日的三個月和九個月內，由於估計交易價格的變化而認定爲百萬美元。
客戶J佔了公司截至2024年9月30日三個月的淨營業收入 11百分之%。. 截至2024年9月30日九個月結束時，公司沒有任何客戶佔公司總淨營業收入的10%以上。 客戶I分別佔了公司截至2023年9月30日三個和九個月的淨營業收入的百分之%。 11%和 11% 。
9
目錄
4. 商譽和無形資產
善意
商譽代表在企業合併中，購買對價超過所獲取的有形和無形資產的公允價值減去承擔的負債的部分。所有商譽與公司的平台業務板塊有關。
無形資產
以下表格總結了公司的無形資產在呈現的期間 (千元單位，除年份外)：
截至2024年9月30日
總賬面價值累計攤銷淨賬面價值加權平均有用壽命
(以年計)
開發的科技$73,367 $(57,944)$15,423 5.9
客戶關係14,100 (14,100)$— 4.0
商標名稱20,400 (7,466)12,934 9.8
專利4,076 (1,407)2,669 14.0
無形資產總額$111,943 $(80,917)$31,026 6.7
截至2023年12月31日
毛額
賬面價值
金額		累計
攤銷		淨值
賬面價值
金額		加權平均有用壽命
(以年計)
開發的科技$73,367 $(49,087)$24,280 5.9
客戶關係14,100 (13,948)152 4.0
商標名稱20,400 (5,966)14,434 9.8
專利4,076 (1,189)2,887 14.0
無形資產總額$111,943 $(70,190)$41,753 6.7
公司在截至2024年6月30日和2023年6月30日的三個月內分別錄得了無形資產的攤銷費用$百萬。3.5 百萬美元和美元4.4 在截至2024年和2023年9月30日的三個月內，無形資產的金額分別爲$百萬和$百萬。 公司記錄了$百萬的攤銷費用。10.7 百萬美元和美元13.2 在截至2024年和2023年9月30日的九個月內，無形資產的金額分別爲$百萬和$百萬。
公司在截至2023年9月30日和2024年9月30日的三個月以及截至2024年9月30日的九個月中，將開發技術的攤銷記錄在營業成本、平台上。在截至2023年9月30日的九個月中，開發技術的攤銷記錄在營業成本、平台和研發費用。公司在所有報告期間的綜合損益表中，將客戶關係和商標的攤銷記錄在銷售和營銷費用中，專利的攤銷記錄在一般和管理費用中。
截至2024年9月30日，未來五年和以後無形資產的預計攤銷費用如下（以千爲單位）：
截止日期爲12月31日的年份 
2024年（剩餘3個月）$3,525 
202512,533 
20264,074 
20272,737 
20282,291 
然後5,866 
總計$31,026 
10
目錄
5. 資產負債表元件
應收賬款淨額: 應收賬款淨額包括以下內容（以千爲單位）：
 截至
 2024年9月30日2023年12月31日
應收賬款，毛額$768,054 $850,464 
減少：津貼
銷售退貨準備金6,070 7,808 
銷售激勵津貼27,971 23,024 
壞賬準備3,283 2,213 
其他撥備819 1,082 
總撥備38,143 34,127 
應收賬款，淨額$729,911 $816,337 
物業和設備，淨值: 固定資產淨額包括以下內容（以千計）：
 截至
 2024年9月30日2023年12月31日
電腦和設備$50,574 $51,320 
租賃改良286,481 292,418 
內部使用軟件5,916 6,980 
辦公設備和傢俱35,900 36,900 
234,036378,871 387,618 
減：累計折舊及攤銷(155,872)(123,062)
物業和設備，淨值$222,999 $264,556 
2024年9月30日結束的三個月中，房地產和設備資產的折舊和攤銷費用分別爲XX百萬美元和2023年爲XX百萬美元。11.8 百萬美元和美元14.5 2024年9月30日結束的九個月中，房地產和設備資產的折舊和攤銷費用分別爲XX百萬美元和2023年爲XX百萬美元。36.9 百萬美元和美元39.8百萬美元。
截至2024年9月30日的三個月和九個月期間，公司確認了與重組工作相關的租賃辦公室設施的物業和設備的減值損失$6.5 百萬美元和美元7.0 百萬。截止至2023年9月30日的三個月和九個月期間，公司記錄了與重組工作相關的租賃辦公室設施的物業和設備的減值損失$68.1 百萬美元和美元68.7 百萬。有關更多詳細信息，請參見對合並基本報表的第16條註釋。
應計負債: 應計負債包括以下（以千元爲單位）：
截至
2024年9月30日2023年12月31日
應付內容合作伙伴的款項$247,371 $239,196 
營業成本應計款項152,966 147,875 
營銷、零售和商品費用65,750 147,853 
經營租賃負債，流動負債77,815 68,099 
內容負債，流動62,509 54,319 
其他應計費用213,754 130,698 
總計應計負債$820,165 $788,040 
11
目錄
遞延收入: 遞延營業收入包括以下項目（單位：千元）：
 截至
 2024年9月30日2023年12月31日
平台，當前$63,438 $66,636 
設備，當前29,967 35,521 
當前遞延營業收入總額93,405 102,157 
平台，非流動資產73 625 
設備，非流動資產23,194 23,947 
非流動遞延收入總額23,267 24,572 
遞延收入總額$116,672 $126,729 
其他長期負債: 其他開多期負債包括以下內容（以千爲單位）：
截至
2024年9月30日2023年12月31日
內容責任，非流動性$20,405 $24,115 
其他長期負債23,248 25,071 
總其他長期負債$43,653 $49,186 
6. 內容 資產
資產內容淨額包括以下內容（以千爲單位）：
 截至
 2024年9月30日2023年12月31日
已授權內容、資產和預付款$159,928 $148,777 
製作內容:
發佈後不再分期攤銷63,193 77,951
已完成，未發佈29,781 11,235
正在製作中10,269 38,275
總生產內容，淨額103,243 127,461
總內容資產，淨額和預付款$263,171 $276,238 
流動部分（包括預付費用和其他流動資產）$15,792 $18,843 
非當前部分$247,379 $257,395 
內容資產的攤銷包含在營業收入成本中，平台在簡明合併經營報表中的表現如下（以千爲單位）：
 截至三個月截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
授權內容$40,744 $37,454 $114,979 $124,690 
產生的內容10,126 15,033 32,106 30,111 
總攤銷成本$50,870 $52,487 $147,085 $154,801 
截至2024年6月30日的三個月內，公司註銷了$11.8 百萬美元的未攤銷成本，這些成本與已從Roku頻道內容庫中移除的製作內容資產有關。這項註銷不是公司重組工作的部分。在截至2024年3月31日和2024年9月30日的三個月內沒有任何註銷。
截至2023年9月30日止三個月和九個月，公司記錄了$ 的減值費用。61.6 百樂公司爲加強重組而從Roku頻道中刪除部分許可和製作內容，產生了相關百萬美元的減值費用。有關公司的簡明合併基本報表詳情，請參閱附註16。
12
目錄
重組努力。
7. 戰略投資
可轉換本票的投資
2022年6月，公司同意向一家與公司具有商業關係的交易對手提供高達$的融資。60.0 百萬美元。這些預付款以可轉換的可賒債券形式確認爲資產負債表上的其他非流動資產。可轉換的可賒債券以每年%的利率計息，並根據下表反映的到期日或在贖回事件或違約事件發生時到期。 5年，而到期日如下表所示，或在贖回事件發生時或違約事件發生時到期。
可轉換的期票及其投資日期和到期日期如下（以千計）：
截至2024年9月30日
投資日期投資金額到期日期
2022年7月1日$40,0002025年6月15日
2023年3月23日$5,0002026年3月23日
2023年5月23日$5,0002026年5月23日
可轉換可贖回票據具有特定贖回特徵，符合嵌入式衍生工具的定義並需要進行分拆。公司選擇了應用公允價值選擇並按公允價值覈算混合工具，其中包括主合同和嵌入式衍生工具的公允價值，將公允價值的任何後續變動計入其他收入淨額，合併利潤表中。有關可轉換可贖回票據的公允價值的更多詳細信息，請參閱基本報表的附註8。
優先股投資
2024年9月，公司投資了$20.0 百萬現金，用於交換私人持有公司的優先股。公司選擇了將毫無明確公允價值的權益證券的計量替代方案，因爲對於優先股來說沒有報價市場價格。該投資按成本計量，並在有觀察到的訂單交易中出現價格變動時調整爲公允價值，並在事件或情況表明賬面價值可能無法收回時進行減值評估。截至2024年9月30日，公司投資的賬面價值爲$20.0 百萬美元，在簡明合併資產負債表中列爲其他非流動資產中。
8. 公平價值披露
公司按公允價值計量的金融資產如下（以千萬計）：
截至2024年9月30日
公允價值一級三級
資產:
現金及現金等價物：
現金$720,059 $720,059 $— 
貨幣市場基金1,406,915 1,406,915 — 
受限現金，流動資產1,822 1,822 — 
其他非流動資產：
戰略投資 - 可轉換債券60,794 — 60,794 
資產的總額按公允價值進行測量和記錄$2,189,590 $2,128,796 $60,794 
13
目錄
截至2023年12月31日
公允價值一級三級
資產:
現金及現金等價物：
現金$594,493 $594,493 $— 
貨幣市場基金1,431,398 1,431,398 — 
受限現金，流動資產40,713 40,713 — 
其他非流動資產：
戰略投資 - 可轉換票據53,816 — 53,816 
資產的總額按公允價值進行測量和記錄$2,120,420 $2,066,604 $53,816 
以下表反映了公司三級財務資產（以千元計）公允價值的變化。
截至三個月截至九個月
2024年9月30日2023年9月30日2024年9月30日2023年9月30日
開始餘額$57,450 $52,558 $53,816 $39,468 
戰略投資 - 可轉換票據— — — 10,000 
戰略投資的公允價值變動 - 可轉換票據3,344 644 6,978 3,734 
結束餘額$60,794 $53,202 $60,794 $53,202 
公允價值被定義爲在主要市場（或在沒有主要市場的情況下最有利的市場）中，按照測量日期的市場參與者之間的有序交易，出售資產時所收到的價格或轉讓負債時所支付的價格。此外，公司最大限度地利用可觀察輸入，並最小化不可觀察輸入在公允價值測量中的使用，並利用三層公允價值層級來優先處理用於測量公允價值的輸入。
用於衡量公允價值的三個輸入層級如下：
一級在活躍市場上報價的相同資產或負債。
使用一級輸入衡量的金融資產和負債包括現金、現金等價物、受限現金、應收賬款、預付費用、應付賬款和應計負債。
公司認爲所有在購買之日具有原始期限不超過三個月的高流動性投資均視爲現金等價物。該公司將貨幣市場基金的$1,406.9 百萬美元和美元1,431.4 百萬分別視爲現金等價物，截至2024年9月30日和2023年12月31日，使用一級輸入進行計量。
二級—在第1級中，除了報價價格的可觀察輸入外，還包括活躍市場中類似資產或負債的報價價格；在非活躍市場中相同或類似資產或負債的報價價格；以及其他可觀察的輸入，這些輸入是通過相關性或其他方式從可觀察市場數據中主要推導或證實的。
截至2024年9月30日和2023年12月31日，公司沒有二級工具。
三級—無法觀察的輸入，由於市場活動很少或沒有，顯著影響資產或負債的公允價值，並反映了公司對市場參與者在定價資產或負債時使用假設的自身假設，這些假設是根據當時最佳可用的信息制定的。
截至2024年9月30日，公司使用第3級輸入衡量其在可轉換債券的戰略投資。可轉換債券戰略投資在購買日期的公允價值被確定爲等於其本金金額。公司記錄了未實現收益爲$3.3 百萬美元和美元0.6 百萬，在其他收入中，淨額與2024年9月30日和2023年9月30日結束的三個月期間可轉換債券戰略投資公允價值調整有關。公司記錄了未實現收益爲$7.0 百萬美元和美元3.7 百萬，在其他收入中，淨額與2024年9月30日和2023年9月30日結束的九個月期間可轉換債券戰略投資公允價值調整有關。
由於缺乏相關的可觀察市場數據用於公允價值輸入，公司將可轉換短期票據的戰略投資分類爲第3等級。可轉換短期票據的戰略投資的公允價值是使用基於情景的概率加權貼現現金流模型估算的。重要的
14
目錄
假設包括折現率，以及影響可轉讓期票策略性投資結算的各種贖回情景的時間和概率加權。
按非經常性基礎公允價值計量的資產和負債
非財務資產如商譽、無形資產、房地產與設備、經營租賃使用權資產及內容資產在確認減值時進行減值評估，並採用第三級輸入調整至公允價值。
在截至2024年9月30日的三個月中，公司記錄的減值費用爲美元11.4百萬美元與經營租賃使用權資產有關，以及 $6.5 百萬美元與財產和設備有關，均與作爲其重組工作一部分的租賃辦公設施有關。在截至2023年9月30日的三個月中，公司記錄的減值費用爲美元101.1百萬美元與經營租賃使用權資產有關，以及 $68.1百萬美元與財產和設備有關，均與作爲其重組工作一部分的租賃辦公設施有關，以及美元61.6數百萬的內容資產減值，這是其重組工作的一部分。
截至2024年9月30日的九個月期間，公司記錄了與經營租賃使用權資產相關的減值費用$22.6百萬，以及與物業和設備相關的減值費用$7.0百萬，這兩個費用均與其重組工作的一部分租賃辦公設施相關。在截至2023年9月30日的九個月期間，公司記錄了與經營租賃使用權資產相關的減值費用$104.9百萬，以及與物業和設備相關的減值費用$68.7百萬，這兩個費用均與其重組工作的一部分租賃辦公設施相關，並且還有$61.6百萬的內容資產減值，這也是其重組工作的一部分。有關詳細信息，請參見基本報表第16條。
9. 租賃
公司的經營租賃主要用於辦公設施。 租約剩餘期限不等，從少於 一份1年內的租賃費用爲年 您好，很高興爲您提供幫助。且可能包括延長或終止租約的選擇。 經營租賃權益資產的折舊年限受預期租賃期限的限制。 公司已就部分可用辦公空間簽訂了轉租協議。 轉租也被分類爲經營租賃。
租賃費用的元件如下（單位：千）:
 截至三個月截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
營業租賃費用
$16,046 $21,097 $52,426 $64,243 
變量租賃費用5,765 5,623 16,518 17,995 
轉租收入(4,871)— (7,756)— 
總經營租賃支出$16,940 $26,720 $61,188 $82,238 
與租賃有關的補充現金流量信息如下（以千爲單位）：
 截至三個月截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
支付與租賃負債計量相關的現金：
經營租賃的經營現金流出$24,192 $19,097 $67,914 $54,417 
用於獲得租賃義務的權利資產:
經營租賃$5,616 $28,795 $8,501 $40,704 
由於減值導致經營租賃使用權資產下降（詳情見附註16）$11,386 $101,077 $22,618 $104,867 
15
目錄
與租賃相關的附表信息如下（單位：千元，租賃期限和折現率除外）：
 截至
 2024年9月30日2023年12月31日
經營租賃使用權資產$314,326 $371,444
經營租賃負債，流動資產中（包含在應計負債中）$77,815 $68,099
非流動經營租賃負債535,378 586,174
總經營租賃負債$613,193 $654,273
經營租賃剩餘平均期限（年）7.27.9
營業租賃的加權平均折現率3.96 %3.94 %
截至2024年9月30日，運營租賃下的未來租賃付款（不包括來自分租安排的任何分租收入）如下（單位：千元）：
截止日期爲12月31日的年份經營租賃
2024年（剩餘3個月）$24,447 
2025101,538 
2026102,067 
2027100,352 
2028100,380 
然後283,199 
總租賃未來支付款項711,983 
減去：隱含利息(95,531)
減少：預期的承租人裝修津貼(3,259)
總計 (1)
$613,193 
(1) 總租賃負債包括與運營租賃權利使用資產有關的負債，這些負債包含在公司重組工作中作爲基本報表附註16的一部分而納入的減值損失中。
截至2024年9月30日，公司賬上大約有未確認稅收優惠金額。1與尚未開始的經營租賃相關的承諾金額千百萬。
截至2024年9月30日，公司預計將從其轉租安排中收到約$86.3 百萬，這些轉租安排的加權平均剩餘租期約爲 5.5 年的時間內確認爲費用。
10. 債務
公司於2024年9月16日簽署了一份信貸協議，該協議由公司作爲借款人、我們的某些子公司作爲擔保人、出借人和參與方銀行，以及花旗銀行有限責任公司作爲行政代理人（「信貸協議」）。該協議規定了（i）最高達$百萬的循環信貸額度和（ii）最高達額外$百萬的不承諾增加選擇權，可在滿足某些慣例條件時行使。信貸協議規定了一個$百萬的支票保函發行分項額度，並且某些現有的信用證被視爲在該額度下未償還。信貸協議將於2029年9月16日到期。信貸協議的款項可用於一般企業用途，包括資助營運資金需求。 五年 百萬美元的循環信貸額度300.0 百萬美元的不承諾增加選擇權300.0 百萬美元100.0 百萬美元的支票保函發行分項額度
公司的信用協議項下的義務由公司的所有資產以及作爲擔保人的子公司資產提供擔保。公司可以提前償還貸款，在某些情況下也被要求提前償還信用協議下的貸款，且無需支付溢價。信用協議還包含慣例性聲明和保證，慣例性正面和負面契約，要求維持最低利息覆蓋率和最高總淨槓桿比率的財務契約，以及慣例性的違約事件，違約事件的發生可能導致借款金額的增加。
16
目錄
信貸協議在計劃的2029年9月16日到期之前到期並終止，剩餘承諾終止。
與公司信貸協議相關的債務發行成本記入預付費用和其他流動資產以及其他非流動資產，按期分期攤銷 五年 並作爲利息費用的組成部分計入壓縮的合併經營報表中。
截至2024年9月30日，公司根據信貸協議擁有未償還的信用證，金額爲$ 百萬。36.4截至2024年9月30日，公司沒有根據信貸協議借款，並且公司遵守了信貸協議的所有條款。

11. 股東權益
優先股
公司在加利福尼亞州爲其辦公空間租賃了一個子租約，該租約於2023年11月開始，最初租約期至2026年1月。該租約替代了同一地址於2022年1月開始的租約，最初租約期至2024年1月（於2024年1月結束）。此外，該公司還租用其他租期少於十二個月的空間；因此，在資產負債表上不承認此租約爲營運租約。10 公司董事會在這些股票發行時確定了未指定優先股的權益和偏好，共授權但未發行的股份爲百萬股。截至2024年9月30日和2023年12月31日，共有 沒有 優先股已發行和流通。
普通股
公司在加利福尼亞州爲其辦公空間租賃了一個子租約，該租約於2023年11月開始，最初租約期至2026年1月。該租約替代了同一地址於2022年1月開始的租約，最初租約期至2024年1月（於2024年1月結束）。此外，該公司還租用其他租期少於十二個月的空間；因此，在資產負債表上不承認此租約爲營運租約。二 授權普通股、A類普通股和B類普通股。持有A類普通股的股東有權 一份 每份持有的B類普通股投票。提交給股東投票的議題，持有B類普通股的股東有權 十 每份B類普通股享有兩票投票權。除了投票權外，A類和B類普通股股東的權利相同。B類普通股可以由持有人自願轉換爲A類普通股，並在出售或轉讓時通常自動轉換爲公司的A類普通股。與股票期權行使、限制性股票單位歸屬或員工股票購買計劃購買的股份有關的，通常會自動轉換爲公司的A類普通股。
在2024年3月31日結束的三個月和2023年3月31日結束的三個月中，保留供將來發行的普通股的發行量如下:
截至2024年9月30日，公司未來發行的普通股如下（以千爲單位）：
截至
 2024年9月30日
根據股權激勵計劃授予的普通股獎勵15,915 
根據2017年員工股票購買計劃可發行的普通股獎勵 (1)
5,089 
根據2017年股權激勵計劃可發行的普通股獎勵31,427 
普通股的總預留股份52,431 
(1) 公司尚未根據2017年員工股票購買計劃發行任何普通股。
其他板塊
該公司當前根據修訂後的2017股權激勵計劃（「2017計劃」）授予股權。2017計劃自2017年9月起生效，與公司的首次公開募股（「IPO」）相關。2017計劃規定向公司的員工授予激勵性股票期權以及向公司的員工、董事和顧問授予非法定股票期權、股票增值權、限制性股票獎、限制性股票單位獎、業績股票獎、業績現金獎以及其他形式的股權薪酬。
公司的未分配股本與2017計劃和2008年股權激勵計劃（「2008計劃」）有關，這是一個IPO前的計劃。自首次公開募股（IPO）以來，沒有根據2008計劃進行額外的股權授予。
2017年計劃授予的股權受連續服務的限制。2017年計劃授予的期權通常以授予日的股票價格爲基準。持有公司合併投票權超過一定比例的期權受限制，授予給這類受限制持有者的激勵股票期權的價格不得低於授予日的公允市場價的 10% 公司所擁有的綜合投票權的持有人受特定限制，授予這類持有人的激勵股票期權的價格不得低於公允市場價的 110% 公允市場價的價格。
限制性股票單位
2024年9月30日截至九個月的限制性股票單位活動如下（按千計，除每股數據外）：
17
目錄
 
數量
股份
 
加權平均
授予日期公允價值
每股價值
2023年12月31日期初餘額
8,674 $97.33 
授予4,316 59.20 
釋放(2,392)111.53 
被取消(581)96.89 
2024年9月30日的餘額
10,017 $77.53 
截至2024年9月30日，公司負債$639.7 百萬未確認的與未歸屬限制性股票單位相關的股票補償費用，預計將在大約加權平均期內確認。 2.1年。
股票期權
截至2024年9月30日的九個月內股票期權活動如下（以千爲單位，除年份和每股數據外）：
 
數量
股份
加權-
平均
行使
價格
加權-
平均
剩餘
加權
壽命（年）
總計
截至2023年7月29日的餘額
價值
2023年12月31日期初餘額
5,310 $75.55 6.8
已授予948 59.17 — 
已行權(332)27.06 — 
已放棄和過期(28)141.30 — 
2024年9月30日的餘額
5,898 $75.33 6.8$109,020 
 
截至2024年9月30日可以行使的期權
3,801 $71.59 5.8$82,033 
截至2024年9月30日，公司負債$69.8 百萬美元的未識別股權獎勵費用與預計將在大約加權平均期內確認的未授予期權相關。 2.1年。
按股票補償計算的費用
公司根據授予日期權益的公允價值來衡量員工服務的成本。授予給員工的期權通常是按比例歸屬的， 一份 to 四年 並且有效期爲 十年。受限股票單位通常按比例歸屬 一份 to 四年.
下表顯示截至2024年和2023年9月30日的三個月和九個月的總股票薪酬費用（以千計）：
 截至三個月截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
營業成本，平台$366 $368 $1,062 $1,056 
營業成本，設備163 810 1,201 2,426 
研發38,502 37,314 109,457 110,801 
銷售和營銷36,401 34,421 100,353 99,785 
一般和行政24,664 18,392 71,051 63,288 
股權報酬總額$100,096 $91,305 $283,124 $277,356 
18
目錄
12. 請見上文。
製造業採購承諾
公司在業務正常開展過程中與供應商簽訂了各種製造業-半導體合同。爲了管理未來產品需求，公司與製造商和供應商達成協議，根據特定標準和時間採購庫存。其中一些承諾是不可取消的。截至2024年9月30日，公司對庫存的不可取消採購承諾金額爲$238.2 百萬美元。截至2024年9月30日，公司已經爲預期的庫存採購承諾損失撥備了$10.4百萬美元。這一計提記錄在簡明合併資產負債表中的應計負債中，相關費用記錄在簡明合併損益表中的營業成本支出中。
內容承諾
公司與內容合作伙伴簽訂合同，以許可和製作流媒體內容。當某個標題可用時，公司在合併的資產負債表上記錄內容資產和負債。某些協議包括對未來未知標題的許可權的義務，但截至報告日期，最終的數量和/或費用尚無法確定。公司不會包括除已知的最低金額之外的未來標題的任何估計義務。這些未知的義務可能是重大的。公司還根據內容授權安排進行許可，其中的付款是變量，並基於公司獲得的營業收入。由於這些金額無法確定，因此未包含在以下的義務中。
截至2024年9月30日，公司對許可及製作內容的總義務爲$268.1 百萬，其中公司在壓縮合並資產負債表中記錄了$65.9 百萬的流動負債和$20.4 百萬的其他開多期負債。其餘$181.8 百萬尚未在壓縮合並資產負債表中確認，因爲該內容不符合資產確認的標準。
這些內容義務預計的付款時間如下（單位：千）：
截止日期爲12月31日的年份
2024年（剩餘3個月）$58,992 
2025139,175
202642,551
202715,735
20287,473
然後4,142
總內容義務$268,068 
信用證
截至2024年9月30日和2023年12月31日，公司有不可撤銷的信用證，金額爲$36.8 百萬美元和美元37.5 百萬美元，分別用於租賃辦公設施。這些信用證的到期日是在2030年之前。截至2024年9月30日，$36.4百萬美元的未償信用證已由授信協議(見註釋10)擔保。
備用金
公司在其認爲損失可能發生且可合理估計時，會對損失應急情況進行會計處理，包括知識產權許可和其他索賠的負債。這些應急情況至少每季度進行一次審查，並根據談判、預計和解、法律裁決以及其他信息和事件的影響進行調整。然而，這些應急情況及其他法律程序的解決本質上是不可預測的，並且存在重大不確定性。
公司可能面臨各種訴訟、股東衍生訴訟、集體訴訟、個體或大規模仲裁程序等各類型法律訴訟，以及其他類型的爭議、索賠、監管或政府調查和審查，這些都屬於業務常規範圍。涉及商業、合同、消費者保護、隱私、數據保護、知識產權、稅務、就業、公司治理和其他事項。儘管這些法律訴訟、爭議、索賠、詢問和調查的結果無法確定，但公司認爲目前參與的任何事項的最終結果不太可能對其業務、財務狀況或經營成果產生重大不利影響。但無論結果如何，這些法律訴訟、爭議、索賠、詢問和調查都可能對公司產生不利影響，因爲涉及律師費、其他訴訟費用、和解費用、管理資源調配、聲譽損害等因素。在截至2024年9月30日的三個和九個月內，公司沒有任何重大損失準備金。
19
目錄
補償
在業務的正常過程中，公司已簽訂合同安排，爲業務合作伙伴和其他相關方提供不同範圍和條款的賠償規定，涉及特定事項，包括但不限於因公司違反這些協議而導致的損失以及第三方提出的知識產權侵權索賠。公司在這些協議下的義務可能在時間或金額上受到限制，在某些情況下，公司可能對第三方有權利要求某些款項。此外，公司還與其董事及某些高管簽署了賠償協議，要求公司在其他事項中，賠償他們因其作爲董事或高管的身份或服務而可能產生的某些責任。
由於先前賠償索賠的有限歷史以及每項協議涉及的獨特事實和情況，目前不可能確定在這些賠償責任下的最大潛在金額。截至目前，公司尚未因此類義務產生任何重大成本，並且未在簡明合併基本報表中計提與此類義務相關的任何負債。
13. 所得稅
所得稅費用爲$4.1 百萬美元和美元3.2 截至2024年9月30日和2023年分別爲0.7百萬美元的所得稅支出。2024年9月30日結束的三個月的所得稅支出增加主要是由於美國所得稅責任增加。
所得稅減免爲$0.2 百萬美元，而所得稅費用爲$8.4 百萬美元，分別對截至2024年和2023年9月30日的九個月的增加主要歸因於對某些外國遞延稅資產減值準備的釋放，預計將根據未來預測的收入得到利用。
當預計遞延稅資產無法實現的可能性大於50%時，必須爲遞延稅資產設立估值備抵。截至2024年9月30日，公司分析了所有可用的客觀證據，包括正面和負面，認爲某些遞延稅資產無法實現的可能性大於50%。因此，公司已爲其美國遞延稅資產提供了估值備抵。
14. 每股淨虧損
公司的基本每股淨虧損是通過將淨虧損除以該期間流通的普通股加權平均股數來計算的。公司採用兩級法來計算每股淨虧損。除非在公司修訂和重述的公司章程中明確規定或法律另有要求，公司的A類普通股和B類普通股在投票、轉換和轉讓權利方面具有相同的權利和特權，並且在各方面排名相同，共同分享，因此基本和稀釋後的每股淨虧損對於兩個類別都是相同的。
在計算每股攤薄淨虧損時，購買普通股和受限股單位的期權被視爲普通股等價物。 通過應用庫存法確定普通股的攤薄份額。 在淨虧損期間，攤薄份額被排除在每股攤薄淨虧損的計算之外，因爲它們的效果是抗稀釋的。
下表顯示基本和稀釋每股淨損失的計算（以千爲單位，除每股數據外）：
截至三個月截至九個月
2024年9月30日2023年9月30日2024年9月30日2023年9月30日
分子：
淨損失$(9,030)$(330,071)$(93,838)$(631,270)
分母：
加權平均普通股份-基本和攤薄144,862141,877144,319141,087
基本每股淨虧損和稀釋淨虧損$(0.06)$(2.33)$(0.65)$(4.47)
截至2024年9月30日的三個和九個月，未行使的股權獎勵 15.9 普通股百萬股不計入每股稀釋淨虧損的計算，因爲它們具有抗稀釋效應。
截至2023年9月30日的三個月和九個月，未發行的股份獎勵爲 15.8 百萬股普通股因其抗稀釋效應而被排除在每股稀釋淨虧損的計算之外。
20
目錄
15. 區段信息
公司分爲以下報告段: 二 報告的業務部門如下:
平台
平台營業收入來源於數字廣告的銷售（包括直接和程序化視頻廣告、媒體和娛樂推廣支出，以及相關服務）和流媒體服務的分發（包括訂閱和交易收入份額、Premium 訂閱的銷售，以及遙控器上品牌應用按鈕的銷售）。
設備
設備營業收入來自於銷售流媒體播放器、Roku品牌電視、智能家居-腦機產品和服務、音頻產品及相關配件，以及與服務運營商的許可協議所產生的收入。
佔據10%或以上營業收入的客戶如下：
 截至三個月截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
平台部門營業收入：
客戶 I*13 %*13 %
客戶J13 %*11%*
設備部門營業收入：
客戶A23 %21 %22 %12 %
客戶B15 %16 %20 %15 %
客戶C25 %37 %27 %40 %
Customer K16 %***
* 小於 10%
按照公司產品和服務交付的地點確定的地理營業收入，國際市場營業收入在每個期間中均不到10%。
開多資產，淨值
下表列出了按地區劃分的開多資產（淨額），主要包括財產和設備及經營租賃使用權資產（單位：千元）：
截至
2024年9月30日2023年12月31日
美國$416,734$497,024
英國93,984109,315
其他國家26,60729,661
總計$537,325$636,000
公司在截至2024年和2023年9月30日的九個月內，針對某些營運租賃使用權資產和物業設備記錄了減值費用。有關詳情，請參閱簡明合併基本報表附註16。
16. 重組
公司由於經濟狀況在2022財年的第四季度開始努力減少運營費用增長率。公司在截至2022年12月31日的年度內記錄了員工解僱費用和與廢棄科技資產相關的減值費用。
截至2023年12月31日，公司實施了包括整合辦公空間利用、對內容組合進行戰略評估、減少外部服務費用以及通過裁員和限制新招聘來減緩年度員工費用增長率等附加措施。因此，公司記錄了與員工解僱費用相關的重組費用，這些費用主要包括遣散費、員工福利繳款、薪資稅以及相關費用，以及與決定轉租和停止使用某些辦公設施相關的減值費用。
21
目錄
以及相關的物業和設備，以及與在該期間從Roku頻道移除特定許可和製作內容相關的減值費用。
截至2024年9月30日的三個月和九個月期間，公司的重組費用主要與員工解僱支出有關，包括遣散費、員工福利繳款、工資稅及相關費用，以及與決定轉租並停止使用某些辦公設施和相關資產設備有關的減值費用。
重組費用記錄如下（單位：千）：
截至2024年9月30日的三個月截至2023年9月30日的三個月
員工解僱設施退出成本資產減值損失總計員工解僱設施退出成本資產減值損失總計
營業成本，平台$— $— $— $— $764 $1 $61,995 $62,760 
營業成本，設備— — — — 408 6 2,792 3,206 
研發— 52 (1,418)(1,366)17,736 1,462 75,442 94,640 
銷售和營銷— 717 16,271 16,988 22,013 319 59,679 82,011 
一般和行政— 140 2,759 2,899 9,445 67 30,919 40,431 
總重組費用$— $909 $17,612 $18,521 $50,366 $1,855 $230,827 $283,048 
截至2024年9月30日的九個月截至2023年9月30日的九個月
員工解僱設施退出成本資產減值費用總計員工解僱設施退出成本資產減值損失總計
營業成本，平台$(3)$— $— $(3)$764 $1 $61,995 $62,760 
營業成本，設備1 — 5 6 408 6 2,792 3,206 
研發368 98 (603)(137)31,039 1,462 75,442 107,943 
銷售和營銷697 719 24,641 26,057 29,300 319 59,679 89,298 
一般和行政(116)117 5,075 5,076 14,230 1,670 35,257 51,157 
總重組費用$947 $934 $29,118 $30,999 $75,741 $3,458 $235,165 $314,364 
截至2024年9月30日的三個月資產減值費用主要包括$11.4 百萬的經營租賃使用權資產減值和$6.5 百萬的物業和設備減值。截至2024年9月30日的九個月資產減值費用包括$22.6 百萬的經營租賃使用權資產減值和$7.0 百萬的物業和設備減值，扣除$0.5 百萬的其他開多負債和資產的調整。截至2023年9月30日的三個月資產減值費用包括$101.1 百萬的經營租賃使用權資產減值，$68.1 百萬的物業和設備減值，以及$61.6 內容資產減值爲百萬。截止到2023年9月30日的九個月內，資產減值費用包括$104.9 $百萬的經營租賃使用權資產減值，$68.7 $百萬的物業和設備減值，以及$61.6 $百萬的內容資產減值。
員工終止重組費用和設施退出費用的期初和期末餘額的調節，如下所示（以千爲單位）：
截至2024年9月30日的三個月截至2023年9月30日的三個月
員工解僱設施退出成本總計員工解僱設施退出成本總計
開始餘額$181 $839 $1,020 $422 $820 $1,242 
重組費用支出— 909 909 50,366 1,855 52,221 
已支付的款項(181)(326)(507)(3,128)(1,180)(4,308)
結束餘額$— $1,422 $1,422 $47,660 $1,495 $49,155 
22
目錄
截至2024年9月30日的九個月截至2023年9月30日的九個月
員工解僱設施退出成本總計員工解僱設施退出成本總計
開始餘額$12,661 $1,198 $13,859 $22,093 $— $22,093 
重組費用已發生947 934 1,881 75,741 3,458 79,199 
已支付的款項(13,608)(710)(14,318)(50,174)(1,963)(52,137)
結束餘額$— $1,422 $1,422 $47,660 $1,495 $49,155 
23
目錄
項目2. 管理層對財務狀況和業績的討論與分析
以下對我們的財務狀況和經營結果的討論與分析應與我們在本季度報告中其他部分包含的簡明合併基本報表及相關注釋，以及我們於2023年12月31日結束的年度報告中包含的審計合併基本報表一起閱讀，該報告於2024年2月16日提交給證監會。
概覽
我們的兩個報告部門是平台部門和設備部門。平台營業收入來自數字廣告銷售（包括直接和程序化視頻廣告、媒體和娛樂推廣支出以及相關服務）和流媒體服務分銷（包括訂閱和交易收入分成、高級訂閱銷售以及遙控器上品牌應用按鈕的銷售）。
設備營收來自流媒體播放器、羅克品牌電視（從2023年3月開始）、智能家居產品和服務、音頻產品以及相關配件的銷售，以及來自與服務運營商的許可安排的營收。我們期望繼續管理羅克流媒體設備的平均售價，以增加我們的流媒體家庭規模。我們預計，從設備毛利潤或虧損的權衡轉向增加流媒體家庭規模，應會導致平台營業收入和平台毛利潤隨時間增長。
關鍵業績指標和非GAAP財務指標
我們用來評估業務、衡量績效、制定財務預測和做出戰略決策的關鍵績效指標目前是流媒體家庭數量、流媒體時長、每用戶平均收入（「ARPU」）和自由現金流。
從2025年第一季度的業績開始，我們將不再報告有關流媒體家庭和相應的用戶平均收入（ARPU）的季度更新。自2017年首次在我們的首次公開募股中報告關鍵績效指標以來，我們的業務和流媒體行業板塊已經發生了顯著變化。現在，我們主要關注我們的平台業務的營業收入增長和調整後的息稅折舊攤銷前盈利（調整後EBITDA）。因此，從2025年第一季度開始，我們的關鍵績效指標將是流媒體小時數、平台營業收入、調整後EBITDA和自由現金流。
流媒體家庭
我們認爲，流媒體家庭的數量是衡量用戶基礎規模的相關指標。我們將流媒體家庭定義爲在報告期內過去30天內在我們平台上觀看過內容的不同用戶帳戶數量。我們將這些帳戶稱爲「流媒體家庭」，因爲一個用戶帳戶不一定代表一個單獨的觀衆或單一的Roku流媒體設備。實際上，一個帳戶可以由多個觀衆使用，並且可以鏈接到多個設備。因此，我們可能會在一個單一住所內識別到多個流媒體家庭，同時多個住所可能構成一個流媒體家庭。
僅在非Roku平台上觀看The Roku Channel內容的用戶數不包括在此指標中。此外，僅註冊帳戶以使用我們某一個智能家居-腦機產品的用戶數也不包括在我們報告的流媒體家庭數量中。
截至2024年9月30日，我們有8550萬和7580萬流媒體家庭，分別較2023年增長了13%。
觀看時間
我們認爲平台上的流媒體小時數是用戶參與度的有效衡量標準，並且在我們平台上流媒體內容的小時數增長反映了我們在滿足日益增長的用戶對電視流媒體的需求方面取得的成功。我們將流媒體小時定義爲在特定時期內Roku流媒體設備在我們平台上流媒體內容的累計時長。非Roku平台上從The Roku Channel流媒體的小時數不包括在此指標中。此外，智能家居產品不會增加我們的流媒體小時數。我們按日曆基準報告流媒體小時數。
此外，我們相信，隨着時間的推移，增加用戶在我們流媒體平台上的參與度將提高我們平台的盈利能力，因爲我們通過各種形式的用戶參與獲得平台營業收入，包括廣告，以及訂閱和點播視頻的收入分成。然而，我們來自內容合作伙伴的收入與他們的流媒體應用程序上被觀看的小時數並不相關，流媒體小時數與來自這些內容合作伙伴的收入或每用戶平均收入（ARPU）在每個週期之間沒有關聯。此外，平台上的流媒體小時數在Roku流媒體設備播放內容時被計量，無論觀衆是否在積極觀看。例如，如果Roku播放器連接到電視，而觀衆關閉了電視、離開或睡着而沒有停止或暫停播放器，則特定的流媒體應用可能會繼續播放內容。
24
目錄
由流媒體應用程序確定的一段時間。我們相信這也會出現在多種非Roku流媒體設備和其他機頂盒上。
自2020年第一季度以來，我們所有的Roku流媒體設備均包含一個名爲Roku OS的功能，旨在識別應用上的內容在沒有用戶互動的情況下連續播放了一段時間。我們稱之爲「您仍在觀看」的這一功能會定期提示用戶確認他們仍在觀看所選應用，並在用戶沒有積極回應時關閉該應用。我們認爲在Roku平台上實施這一功能對我們、我們的客戶、內容合作伙伴和廣告商都有好處。我們的一些主要內容合作伙伴，包括奈飛，也在其應用中實施了類似的功能。這一Roku OS功能是這些應用功能的補充。這一功能並未對我們未來的財務表現產生過實質影響，也不預計會有。
我們在截至2024年9月30日和2023年9月30日的三個月內分別直播了320億小時和267億小時，反映出增長了20%。
每用戶平均營業收入
我們用ARPU來衡量平台營收進展，我們認爲這代表了我們業務的內在價值。我們將ARPU定義爲過去四個季度的平台註冊收入除以當前期間末和上一年對應期間末的平均流媒體家庭數量。ARPU衡量的是我們變現我們 流媒體家庭 基礎和我們平台業務的進展。
截至2024年9月30日，ARPU相對穩定，達到了41.10美元，與2023年9月30日的41.03美元相比變化不大。這反映了平台營業收入和流媒體家庭的增長率相對一致。
自由現金流（非GAAP指標）
我們使用自由現金流作爲主要指標來衡量我們業務的表現，因爲我們相信最大化自由現金流有助於表明我們業務的財務實力，並提供業務產生或（使用）的現金的指示。我們的目標是持續增加自由現金流。我們將自由現金流定義爲過去12個月（「TTM」）的經營活動現金流量，不包括購買固定資產的影響和匯率對現金的影響。
我們的自由現金流分別爲2024年和2023年截至9月30日的TTM期間爲1.573億美元和1.008億美元。
自由現金流是一項非通用會計原則的財務指標。 自由現金流調解排除了購買固定資產和設備以及匯率對經營活動現金流的影響，在適用的情況下。我們認爲自由現金流對評估我們持續運營績效和增進對過往財務績效的整體理解是有用的補充。然而，這一非通用會計原則的財務指標存在侷限性，不應孤立使用，也不應作爲我們通用會計原則的財務信息（例如通用會計準則下的經營活動現金流）的替代。有關經營活動現金流的更多信息，請參閱下文的「流動性和資本資源」。此外，由於計算方法的差異，自由現金流可能無法與其他公司類似標題的指標進行比較。
下表展示了自由現金流與每個所示期間最直接可比的GAAP財務指標的調節（單位：千）:
過去12個月結束
2024年9月30日2023年9月30日
經營活動產生的淨現金流量$155,080 $246,882 
減:購買固定資產(6,123)(144,477)
匯率變動對現金、現金等價物及受限制現金的影響的增加/減少8,392 (1,599)
自由現金流（過去十二個月）$157,349 $100,806 
25
目錄
業績報告中的元件
收入
平台營業收入
我們通過銷售數字廣告（包括直接和程序化視頻廣告、媒體和娛樂促銷支出及相關服務）以及流媒體服務分發（包括訂閱和交易收入分成、銷售Premium 訂閱以及在遙控器上銷售品牌應用按鈕）來產生平台營業收入。我們的廣告庫存包括來自Roku頻道的AVOD內容的視頻廣告庫存、Roku主屏幕和屏保上的原生蘋果-顯示屏廣告，以及通過與內容合作伙伴的流媒體服務分發協議獲得的廣告庫存。爲了補充供應，我們根據需要從內容合作伙伴購買廣告庫存。迄今爲止，我們的大部分平台營業收入來自美國。
設備營業收入
我們通過銷售流媒體播放器、Roku品牌電視、智能家居-腦機產品和服務、音頻產品及相關配件來產生設備營業收入。我們的設備營業收入還包括與服務運營商的許可協議。我們大部分設備營業收入來自美國。在我們的國際市場上，我們主要通過批發分銷商銷售設備，批發分銷商再將其銷售給零售商。
營業成本
營業收入成本，平台
營業收入成本，平台主要包括與獲取廣告庫存相關的成本，以及內容的攤銷成本，這些內容包括取得許可證和自主製作的內容，以及與內容的分享。 合作伙伴營業收入成本，平台還包括其他成本，例如支付處理費用，與我們服務交付相關的分配費用，這些費用主要包括第三方雲服務的成本，以及我們的平台運營人員的工資、福利和基於股票的補償，以及已收購開發科技的攤銷。
營業收入，設備
設備的營業收入成本主要包括支付給第三方製造商的製造成本，這些設備包括流媒體播放器、Roku品牌電視、音頻產品和智能家居產品。設備的營業收入成本還包括我們出售的設備上的科技許可證或特許權使用費、進出口運費、關稅和物流成本、第三方包裝、庫存準備金，以及與設施、第三方雲服務和運營人員的薪資、福利和基於股票的補償相關的分攤間接費用。
營業費用及其他費用
研發
研究和開發費用主要包括我們的開發團隊的薪資、福利和基於股票的補償，以及外包開發費用。此外，研究和開發費用還包括分配的設施和間接費用。
銷售和市場
銷售和市場營銷費用主要包括工資、福利、佣金和股票補償，以支付從事銷售和銷售客戶支持、市場營銷、通信-半導體、數據科學和分析、業務拓展、產品管理和合作夥伴支持職能的員工。銷售和市場營銷費用還包括市場營銷、零售和商品費用，以及分配的設施和間接費用。
一般和行政
一般和行政支出主要包括爲我們的財務、法律、信息技術、人力資源、業務運營支持和其他行政人員支付的工資、福利和股票補償。一般和行政支出還包括外部法律、會計和其他專業服務費，以及分配的設施和一般性費用。
其他淨收入
截至2024年9月30日和2023年9月的三個月和九個月，其他收入淨額主要包括現金及現金等價物的利息收入，以及可轉換票據的戰略投資的公允價值淨變動（請參見本季度報告第一部分，第1項中的基本報表第7條）。
所得稅支出（福利）
我們的所得稅費用（收益）主要包括我們在某些外國轄區的業務所得稅和美國的所得稅。我們對美國的淨遞延稅資產有全面的估值準備。截止到2024年9月30日的九個月期間，我們解除了一些外國遞延稅資產的估值準備，並確認了所得稅收益。
26
目錄
運營結果
以下表格列出了所示時期營業收入佔總收入比例的精選簡明合併經營數據。
 截至三個月截至九個月
 2024年9月30日2023年9月30日2024年9月30日2023年9月30日
淨營業額：
平台85 %86 %85 %87 %
設備15 %14 %15 %13 %
總淨收入100 %100 %100 %100 %
營收成本:
平台39 %45 %40 %43 %
設備16 %15 %16 %14 %
總成本費用55 %60 %56 %57 %
毛利潤（損失）：
平台46 %41 %45 %44 %
設備(1)%(1)%(1)%(1)%
總毛利潤45 %40 %44 %43 %
營業費用：
研發17 %31 %18 %28 %
銷售和營銷22 %34 %23 %31 %
一般和行政9 %14 %9 %12 %
總營業費用48 %79 %50 %71 %
營業虧損(3)%(39)%(6)%(28)%
其他收入，淨額3 %3 %3 %3 %
稅前損失— %(36)%(3)%(25)%
所得稅費用（利益）— %— %— %— %
淨損失— %(36)%(3)%(25)%
27
目錄
截至2024年9月30日和2023年9月30日三個月和九個月的比較
淨營業收入
截至三個月截至九個月
2024年9月30日2023年9月30日更改 $變動%2024年9月30日2023年9月30日更改 $變動%
(以千爲單位，除了百分比)
平台$908,175 $786,785 $121,390 15 %$2,487,443 $2,165,238 $322,205 15 %
設備154,028 125,233 28,795 23 %424,408 334,956 89,452 27 %
總淨收入$1,062,203 $912,018 $150,185 16 %$2,911,851 $2,500,194 $411,657 16 %
平台
在2024年9月30日結束的三個月內，平台營業收入增加了1.214億美元，或15％，與2023年9月30日結束的三個月相比。增長主要是由於來自流媒體服務分銷的營收增加，如內容訂閱和通過Roku頻道的高級訂閱的營收份額，以及更高的廣告收入，儘管媒體和娛樂行業仍然疲軟。
平台營業收入在截至2024年9月30日的九個月內增加了3.222億美元，或15%，與截至2023年9月30日的九個月相比。增幅主要歸因於流媒體服務分發的營業收入增加，例如內容訂閱和通過Roku頻道的高級訂閱的收入分享，以及廣告收入的增加，儘管媒體和娛樂領域仍持續疲軟。
設備
截至2024年9月30日的三個月內，設備營業收入相比於截至2023年9月30日的三個月增長了2880萬元，增幅爲23%。增長主要是由於Roku品牌電視的營業收入增加，抵消了流媒體播放器和配件的營業收入下降。在截至2024年9月30日的三個月內，所有設備的平均賣出價格增加了11%，所有設備的成交量增加了13% ，與截至2023年9月30日的三個月相比。平均賣出價格的增長是由於Roku品牌電視的銷售增加，通常其售價高於流媒體播放器。設備成交量的增加主要是由於Roku品牌電視銷售的提升。
截至2024年9月30日的九個月內，設備營業收入較2023年9月30日的九個月增加了8950萬美元，增長了27%。增幅主要由於Roku品牌電視的營業收入增加，以及在較小程度上，流媒體播放器和配件的營業收入增加。這一增長被與服務運營商的許可協議營業收入下降以及音頻和智能家居-腦機產品和服務營業收入下降所抵消。 截至2024年9月30日的九個月內，所有設備的平均售價增加了20%，所有設備的成交量增加了9% 與截至2023年9月30日的九個月相比，平均售價的上漲主要是由於Roku品牌電視的銷量增加，因爲其一般售價高於流媒體播放器。設備的成交量增加主要是由於Roku品牌電視銷量較高，以及在較小程度上，流媒體播放器銷量的增加，而智能家居-腦機產品的銷量下降對此進行了抵消。
28
目錄
收入成本
截至三個月截至九個月
2024年9月30日2023年9月30日更改 $變動%2024年9月30日2023年9月30日更改 $變動%
(以千爲單位，除了百分比)
營收成本:
平台$416,396 $408,554 $7,842 2 %$1,161,416 $1,057,151 $104,265 10 %
設備165,732 134,641 31,091 23 %457,369 358,352 99,017 28 %
總成本費用$582,128 $543,195 $38,933 7 %$1,618,785 $1,415,503 $203,282 14 %
平台
與2023年9月30日結束的三個月相比，截至2024年9月30日，營業收入平台的成本增加了780萬美元，增長了2%。這一增長主要是由於獲取內容成本的增加、廣告庫存成本的增加以及更高的信用卡處理費用，部分抵消了與內容資產相關的較低減值費用和較低的內容資產攤銷。
在2024年9月30日結束的九個月內，相較於2023年9月30日結束的九個月，營業收入平台成本增加了10430萬美元，增長了10%。這一增加主要是由於內容採購成本的增加、內容資產的減值、以及信用卡處理費用的提高所致，部分抵消了與內容資產相關的較低減值費用、較低的內容資產攤銷費用，以及較低的廣告庫存成本。
設備
截至2024年9月30日的三個月內，營業收入成本和設備成本增加了3110萬美元，或23%，相比於截至2023年9月30日的三個月。增長主要是由於製造成本增加了3480萬美元，主要是由於生產Roku品牌電視的製造成本增加，以及運費成本增加了1100萬美元。這些增加部分被較低的特許權使用費成本520萬美元和較低的重組費用320萬美元所抵消。
截至2024年9月30日的九個月內，設備的營業收入成本增加了9900萬美元，增長了28%，而截至2023年9月30日的九個月內的營業收入成本。增長的主要原因是製造成本增加了8700萬美元，主要是由於製造Roku品牌電視的成本，以及運輸成本增加了2010萬美元。
營業費用
截至三個月截至九個月
2024年9月30日2023年9月30日更改 $變動%2024年9月30日2023年9月30日更改 $變動%
(以千爲單位，除了百分比)
研發$178,798 $282,201 $(103,403)(37)%$534,738 $694,673 $(159,935)(23)%
銷售和營銷237,047 307,694 (70,647)(23)%660,827 768,805 (107,978)(14)%
一般和行政99,993 128,717 (28,724)(22)%276,543 309,422 (32,879)(11)%
總營業費用$515,838 $718,612 $(202,774)(28)%$1,472,108 $1,772,900 $(300,792)(17)%
研發費用
在2024年9月30日結束的三個月內，研發費用減少了10340萬美元，降低了37%；較2023年9月30日結束的三個月，由於重組費用降低了9600萬美元、辦公設施和製造行業基礎設施費用降低了520萬美元，以及人員相關費用降低了2.0百萬美元。
在截至2024年9月30日的九個月內，研發費用減少了15990萬元，或23%，與截至2023年9月30日的九個月相比。這一減少主要是由於重組費用下降了10810萬元，人事相關費用下降了2820萬美元，辦公設施和It製造行業的費用下降了1540萬美元，諮詢費用降低了660萬美元。
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銷售和營銷
截至2024年9月30日的三個月內，銷售和市場費用減少了7060萬美元，下降了23%，與截至2023年9月30日的三個月相比。這一下降主要是由於重組費用減少了6500萬美元，辦公室設施和製造行業費用減少了530萬美元，以及與人員相關的費用減少了360萬美元，這部分被增加的諮詢費用160萬美元所抵消。
在2024年9月30日結束的九個月內，銷售和營銷費用減少了10800萬美元，或14%，相比2023年9月30日結束的九個月。這一減少是由於重組費減少了6320萬美元，人員相關費用減少了2980萬美元，辦公場所設施和IT基礎設施費用減少了1190萬美元，以及市場營銷、零售和商品費用減少了770萬美元，部分抵消了諮詢費用增加的350萬美元。
一般和管理費用
截至2024年9月30日結束的三個月，總務及行政費用比2023年9月30日結束的三個月減少了2870萬美元，降低了22%。主要是由於重組費用降低了3750萬美元，壞賬費用減少了120萬美元，辦公設施和IT製造行業支出降低了100萬美元，部分抵消了法律和諮詢費用增加1080萬美元以及人員相關費用增加220萬美元。
截至2024年9月30日止九個月，管理和行政開支減少了3290萬美元，或11%，相比於2023年9月30日止九個月。這一降低是由於重組費用減少4610萬美元，辦公設施和IT基礎設施開支減少250萬美元，以及人員相關開支減少130萬美元，部分抵消了法律和諮詢費用增加1670萬美元。
其他淨收入
截至三個月截至九個月
2024年9月30日2023年9月30日更改 $變動%2024年9月30日2023年9月30日更改 $變動%
(以千爲單位，除了百分比)
其他收入，淨額$30,880 $22,902 $7,978 35 %$84,955 $65,317 $19,638 30 %
其他收入淨額在截至2024年9月30日的三個月內增加了800萬美元，或35%，與截至2023年9月30日的三個月相比。增加主要是由於現金餘額增加導致的200萬美元的利息收入增加，主要由於可轉換票據的戰略投資公允價值變動相關的未實現收益增加的270萬美元的其他收入增加，以及由於匯率波動帶來的340萬美元的匯率期貨收益。
2024年9月30日止的九個月中，其他收入淨額增加了1960萬美元，增長了30%，相比於2023年9月30日止的九個月。這一增長主要是由於由於現金餘額增加而帶來的1220萬美元的利息收入增加，其他收入增加了370萬美元，主要是由於與可轉換可贖回票據的戰略投資的公允價值變動相關的未實現收益增加，以及因匯率波動而帶來的280萬美元的匯率期貨收益。
所得稅費用（收益）
截至三個月截至九個月
2024年9月30日2023年9月30日更改 $變動%2024年9月30日2023年9月30日更改 $變動%
(以千爲單位，除了百分比)
所得稅費用（利益）$4,147 $3,184 $963 30 %$(249)$8,378 $(8,627)(103)%
2024年9月30日結束的三個月中，所得稅費用比2023年9月30日結束的三個月增加了100萬美元，主要是由於美國稅收責任增加。
截至2024年9月30日的九個月內，所得稅費用較截至2023年9月30日的九個月減少了860萬美元，主要是由於對某些外國遞延稅資產估值準備的解除帶來的稅收收益。
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目錄
非GAAP財務指標
截至2024年9月30日，我們的現金及現金等價物爲212700萬美元。我們的現金中約有6%存放在美國以外的帳戶中，這些帳戶由我們的外國子公司持有，用於資助海外運營。
我們的主要現金來源是來自平台和設備的營業收入。現金的主要使用包括營業收入的成本，包括獲取廣告庫存的成本、許可證和製作內容的成本、我們產品的第三方製造成本，以及其他營業費用，如與人員相關的費用，包括員工遣散付款、諮詢和專業服務費用、設施費用和營銷費用。其他現金使用包括購買物業和設備以及併購。
我們在過去追求過併購活動，並且未來可能會繼續追求額外的併購活動，包括收購編程和內容資產的權利。儘管我們不預計在設施和建築相關成本上支出會與過去幾年的水平相當，但爲了支持我們業務的未來增長，我們將繼續在維護設施和購置計算機系統及其他財產和設備上產生費用。這些活動可能會對我們的流動性和資本資源產生重大影響。
我們相信我們現有的現金及現金等價物餘額，以及我們信貸協議下未提取的可用餘額（將在下面進一步討論），將足以滿足我們未來十二個月及更長時間的營運資金、資本支出和已知合同義務的重大現金需求。我們的未來資本需求、可用資金的充足性以及來自運營的現金流，可能會受到各種風險和不確定因素的影響，包括但不限於在本季度報告的第二部分，第一項A，風險因素中詳細列出的那些因素，以及當前宏觀經濟環境的影響。雖然到目前爲止，當前的宏觀經濟環境並未嚴重影響我們的流動性和資本資源，但它對地方經濟以及資本和信貸市場造成了擾動和波動，這可能在未來對我們的流動性和資本資源產生不利影響。
我們可能會通過發行股權證券或其他融資安排來嘗試籌集額外資金。如果我們通過發行股權籌集資金，現有股東的股份將被稀釋。如果我們通過承擔債務來籌集額外融資，我們可能會面臨固定的支付義務和限制性條款。此外，由於當前的宏觀經濟環境，我們可能無法以我們可以接受的條款獲得債務或股權融資。
Debt
在2024年9月16日，我們與公司（作爲借款人）、部分子公司（作爲擔保人）、參與的貸方和發行銀行以及作爲管理代理的花旗銀行（「信貸協議」）簽訂了信貸協議，該協議提供了（i）一項爲期五年的循環信貸額度，總本金金額最高可達30000萬美元，以及（ii）在滿足某些慣例條件的情況下，可以行使的最高額外300.0百萬美元的非承諾增加選項。信貸協議規定了10000萬美元的次級設施用於信用證的簽發，且某些現有信用證被視爲在此設施下未結清。信貸協議將在2029年9月16日到期。信貸協議的收益可用於一般企業用途，包括融資營運資金需求。
根據信貸協議，我公司及作爲信貸協議擔保方的子公司的幾乎所有資產均受到保護。在某些情況下，我們可以提前償還信貸協議下的貸款，有時也必須提前償還貸款，而無需支付溢價。信貸協議還包括慣例的陳述和保證、慣例的肯定和否定契約、財務契約要求保持最低利息覆蓋比率和最大總淨槓桿比率，以及慣例的違約事件，一旦發生這些違約事件，可能導致在信貸協議下借入的金額到期應付，並導致在其計劃的2029年9月16日終止日期之前，尚未履行的承諾被終止。
截至2024年9月30日，我們擁有由信用協議擔保的優秀信用證，金額爲3640萬美元。截至2024年9月30日，我們尚未根據信用協議借款，並且我們符合信用協議的所有契約。
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目錄
現金流
下表總結了所呈現期間的現金流（單位：千元）：
截至九個月
2024年9月30日2023年9月30日
壓縮的綜合現金流量表數據:
經營活動產生的現金流量$138,753 $239,529 
投資活動產生的現金流量淨額$(22,603)$(89,099)
用於籌資活動的現金流量$(56,732)$(65,301)
經營活動現金流
我們的運營活動在截至2024年9月30日的九個月內提供了13880萬美元的現金。我們在截至2024年9月30日的九個月內的淨虧損爲9380萬美元，已通過548.0百萬美元的非現金費用進行調整，主要包括基於股票的補償、內容資產的攤銷和註銷、物業和設備及無形資產的折舊和攤銷、運營租賃使用權資產的攤銷以及資產減值。我們運營資產和負債的變化使用了315.4百萬美元的現金，主要由於應付賬款因支付時間而減少、用於收購內容的付款、用於運營租賃負債的付款、遞延收入的減少、預付費用和其他流動資產的增加、其他長期資產的增加以及庫存的增加。這部分被應收賬款餘額的減少和應計負債的增加所抵消。
投資活動現金流
截至2024年9月30日的九個月中，我們的投資活動包括現金流出2260萬美元，其中包括260萬美元的物業和設備購買，以及2000萬美元的戰略投資購買。
融資活動現金流
截至2024年9月30日的九個月內，我們的融資活動使用了5670萬美元的現金。現金流出主要與我們在此期間對歸屬的股權獎勵淨結算所支付的6390萬美元稅款以及與我們的信貸協議相關的180萬美元發行費用有關，部分被員工股票期權行使所得的900萬美元所抵消。
已知合同義務的資金需求
截至2024年9月30日，我們已知合同義務的實際現金需求包括：
•Commitments to purchase finished goods from our contract manufacturers and other inventory related items. Consistent with industry practices, we enter into firm, non-cancelable, and unconditional purchase commitments with our contract manufacturers to acquire products through a combination of purchase orders, supplier contracts, and open orders based on projected demand information. Our contract manufacturers source components and build our products based on these demand forecasts. Changes to projected demand or in the subsequent sales mix of our products may result in us being committed to purchase excess inventory to satisfy these commitments. For additional information regarding manufacturing purchase commitments, see Note 12 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
•Commitments to license content from content partners and produce content under contractual arrangements. For additional information regarding content commitments, see Note 12 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
•Operating lease liabilities that are included in our condensed consolidated balance sheets and liabilities related to the lease arrangements that have not yet commenced. For additional information regarding our lease liabilities, see Note 9 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report. Our restructuring efforts to consolidate office space did not materially change our operating lease obligations.
The contractual commitments discussed above are associated with agreements that are enforceable and legally binding. Obligations under contracts that we can cancel without a significant penalty are not included above.
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Critical Accounting Policies and Estimates
Our financial statements are prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. These estimates and assumptions are based on historical experience, current trends and other factors that we believe to be reasonable at the time our condensed consolidated financial statements are prepared. We evaluate our estimates and assumptions on an ongoing basis. There have been no material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in our Annual Report.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Fluctuation Risk
Our exposure to interest rate risk relates to the interest income generated by cash and cash equivalents. The primary objective of our investment policy is to preserve principal while maximizing income without significantly increasing risk. We believe that an increase or decrease in interest rates of 100 basis points on our cash and cash equivalents balance would impact our interest income by an additional increase or decrease of $21.0 million.
Foreign Currency Exchange Rate Risk
Most of our revenue is generated within the United States and as such we have minimal foreign currency risk related to our revenue. Our foreign currency risk primarily relates to operating expenses, cash balances, and lease liabilities denominated in currencies other than U.S. dollars, primarily British pounds and Euros. Our results of current and future operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates.
We have experienced and will continue to experience fluctuations in our net income as a result of transaction gains or losses related to revaluing monetary asset and liability balances that are denominated in currencies other than the functional currency of the entities in which they are recorded. We have not entered into any derivatives or other financial instruments in an attempt to hedge our foreign currency exchange risk, but we may do so in the future.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.
Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended September 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION
Item 1. Legal Proceedings
Information with respect to this item may be found in Note 12 to the condensed consolidated financial statements, Part I, Item 1 of this Quarterly Report and is incorporated herein by reference.
Item 1A. Risk Factors
Our business involves significant risks, some of which are described below. You should carefully consider the risks and uncertainties described below, together with all the other information in this Quarterly Report, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the condensed consolidated financial statements and the related notes. If any of the following risks actually occur, our business, reputation, financial condition, results of operations, revenue, key performance metrics (including Streaming Households, Streaming Hours, ARPU, and Free Cash Flow), and future prospects could be seriously harmed. In addition, you should consider the interrelationship and compounding effects of two or more risks occurring simultaneously. Unless otherwise indicated, references to our business being harmed in these risk factors will include harm to our business, reputation, financial condition, results of operations, revenue, key performance metrics, and future prospects. In that event, the market price of our Class A common stock could decline, and you could lose part or all of your investment. You should not interpret our disclosure of any of the following risks to imply that such risks have not already materialized. The risks facing our business have not changed substantively from those discussed in our Annual Report, filed with the SEC on February 16, 2024, except for those risks marked with an asterisk (*).
Risk Factors Summary
Below is a summary of the principal factors that make an investment in our Class A common stock speculative or risky:
Risks Related to Our Business and Industry
•the highly competitive nature of the TV streaming industry that is rapidly evolving;
•our ability to grow revenues from advertising on our platform;
•our ability to further monetize our streaming platform;
•our ability to successfully work with third-party demand sources and run our demand-side platform;
•our ability to develop, maintain, and expand relationships with licensed Roku TV partners, manufacturing partners, and service operators;
•our ability to establish and maintain relationships with important content partners;
•popular or new content publishers not publishing their content on our streaming platform;
•the non-renewal or early termination of our agreements with content partners;
•maintaining an adequate supply of quality video advertising inventory on our platform and effectively selling the available supply;
•content partners electing not to participate in platform features that we develop;
•irrelevant or unengaging advertising campaigns on our streaming platform;
•our ability to operate and monetize The Roku Channel;
•users signing up for offerings and services outside of our platform;
•our and our licensed Roku TV partners’ ability to develop, maintain, and expand relationships with important retail sales channels that we and they rely on to sell our streaming devices and other products;
•our ability to build a strong brand and maintain customer satisfaction and loyalty;
•advertiser or advertising agency delayed payment or failure to pay;
•maintaining adequate customer support levels;
•our introduction of new products and services;
•our and our licensed Roku TV partners’ reliance on contract manufacturers and limited manufacturing capabilities;
•our reliance on licensed Roku TV partners’ operations for the supply of Roku TV models;
•our ability to forecast manufacturing requirements and manage our supply chain and inventory levels;
•decreased availability or increased costs for materials and components used in the manufacturing of our products and our licensed Roku TV partners’ products;
•our ability to obtain key components from sole source suppliers;
•interoperability of our products with content partners’ and other third parties’ offerings, technologies, and systems;
•detecting hardware defects and software errors in our products before they are released to end users;
•component manufacturing, design, or other defects that may render our products permanently inoperable;
•our ability to obtain or maintain necessary or desirable licenses, certifications, or approvals related to our use or support of third-party technology, intellectual property, or services;
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•our use of artificial intelligence (“AI”) technologies in some of our products and services;
Risks Related to Operating and Growing Our Business
•our history of operating losses;
•volatility of our quarterly operating results that could cause our stock price to decline;
•our ability to manage our growth;
•our ability to successfully expand our international operations;
•seasonality and other potential fluctuations in our business and their impact on our revenue and gross profit;
•attracting and retaining key personnel and managing succession;
•maintaining systems that can support our growth, business arrangements, and financial rules;
•our ability to successfully complete acquisitions and investments and integrate acquired businesses;
•our ability to comply with the terms of our outstanding credit facility;
•our ability to secure funds to meet our financial obligations and support our planned business growth;
•adverse developments affecting financial institutions, including bank failures;
Risks Related to Cybersecurity, Reliability, and Data Privacy
•data security incidents, including cybersecurity attacks, or other significant disruptions of our information technology systems that could adversely affect our business and subject us to liability;
•legal obligations and potential liability or reputational harm related to our collection, storage, and use of personal and confidential information related to the users of our products and services and cybersecurity incidents;
•disruptions in information technology systems or other services that result in a degradation of our platform;
•changes in how network operators manage data that travel across their networks;
Risks Related to Intellectual Property
•intellectual property infringement claims and litigation resulting in significant costs or the loss of important intellectual property rights;
•failure or inability to protect or enforce our intellectual property or proprietary rights;
•our use of open-source software;
•our agreements to indemnify certain of our partners if our technology is alleged to infringe on third parties’ intellectual property rights;
Risks Related to Macroeconomic Conditions
•the impact of macroeconomic conditions, natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events on our business;
Legal and Regulatory Risks
•lawsuits and other legal proceedings, disputes, claims, and government inquiries and investigations;
•enactment of or changes to government regulation or laws related to our business;
•changes in U.S. or foreign trade policies, geopolitical conditions, and general economic conditions that impact our business;
•U.S. or international rules (or the absence of rules) that permit internet access network operators to degrade users’ internet service speeds or limit internet data consumption by users;
•liability for content that is distributed through or advertising that is served through our platform;
•our ability to maintain effective internal controls over financial reporting;
•the impact of changes in accounting principles;
•compliance with laws and regulations related to the payment of income taxes and collection of indirect taxes;
•changes to U.S. or foreign taxation laws or regulations;
Risks Related to Ownership of Our Class A Common Stock
•the dual class structure of our common stock;
•volatility in the market price of our Class A common stock;
•potential dilution or a decline in our stock price caused by future sales or issuance of our capital stock or rights to purchase capital stock;
•a decline in our stock price caused by future sales by existing stockholders;
•dependency on favorable securities and industry analyst reports;
•the significant legal, accounting, and other expenses associated with being a publicly traded company;
•the absence of dividends on our Class A or Class B common stock;
•anti-takeover provisions in our charter and bylaws; and
•the limitations resulting from our selection of the Delaware Court of Chancery and the U.S. federal district courts as the exclusive forums for substantially all disputes between us and our stockholders.
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Risks Related to Our Business and Industry
The TV streaming industry is highly competitive and many companies, including large technology companies, content owners and aggregators, TV brands, and service operators, are actively focusing on this industry. If we fail to differentiate our streaming platform and compete successfully with these companies, it will be difficult for us to attract and retain users and our business will be harmed.*
The TV streaming industry is highly competitive and global. Our success depends in part on attracting users to and retaining users on, and the effective monetization of, our streaming platform. To attract and retain users, we need to be able to respond efficiently to changes in user tastes and preferences and to offer our users access to the content they love on terms that they accept. Effective monetization requires us to continue to update the features and functionality of our streaming platform for users, content partners, and advertisers. We also must effectively support popular sources of streaming content that are available on our platform, such as Amazon Prime Video, Disney+, Hulu, Max, Netflix, and YouTube. And we must respond rapidly to actual and anticipated market trends in the TV streaming industry.
Large companies such as Amazon, Apple, and Google offer TV streaming devices that compete with Roku streaming devices made by us and our licensed Roku TV partners. In addition, Google licenses its Android operating system software for integration into smart TVs and service provider set-top boxes, and Amazon licenses its operating system software for integration into smart TVs and sells Amazon-branded smart TVs. If Walmart’s pending acquisition of Vizio is consummated, we may face increased competition from Walmart, which currently makes and sells Onn. branded streaming products, including co-branded Roku TV models. These companies have greater financial resources than we do and can subsidize the cost of their streaming devices or licensing arrangements in order to promote their other products and services, which could make it harder for us to acquire new users, retain existing users, increase Streaming Hours, and monetize our streaming platform. These companies could also implement standards or technology that are not compatible with our products or that provide a better streaming experience. These companies also have greater resources to promote their brands through advertising than we do.
In addition, many TV brands offer their own TV streaming solutions within their TVs. Other devices, such as game consoles, also incorporate TV streaming functionality. Similarly, some service operators, such as Comcast and Charter Communications (and their joint venture, Xumo, LLC), offer TV streaming applications and devices as part of their cable service plans and can leverage their existing user bases, installation networks, broadband delivery networks, and name recognition to gain traction in TV streaming. If viewers of TV streaming content prefer alternative products to Roku streaming devices, we may not be able to achieve our expected growth in platform revenue, gross profit, and our key performance metrics.
We also compete for Streaming Hours with mobile streaming applications on smartphones and tablets, and users may prefer to view streaming content on such applications. Increased use of mobile or other platforms for TV streaming could adversely impact the growth of our Streaming Hours, harm our competitive position, and otherwise harm our business.
We expect competition in TV streaming from the large companies and service operators described above, as well as new and growing companies, to continue to increase in the future. This increased competition could result in pricing pressure, lower revenue and gross profit, declines in our key performance metrics, or the failure of Roku streaming devices, our streaming platform, or our other products to gain or maintain broad market acceptance. To remain competitive and maintain our position as a leading TV streaming platform, we need to continuously invest in our platform, product development, marketing, service and support, and device distribution infrastructure. In addition, evolving TV standards and unknown future developments may require further investments in the development of Roku streaming devices, our streaming platform, and our other products. We may not have sufficient resources to continue to make the investments needed to maintain our competitive position. In addition, many of our competitors have longer operating histories, greater name recognition, larger customer bases and significantly greater financial, technical, sales, marketing, and other resources than us, which provide them with advantages in developing, marketing, or servicing new products and offerings. As a result, they may be able to respond more quickly to market demand, devote greater resources to the development, promotion, sales, and distribution of their products or their content, and influence market acceptance of their products better than we can. These competitors may also be able to adapt more quickly to new or emerging technologies or standards and may be able to deliver products and services at a lower cost. Increased competition could reduce our sales volume, revenue, and operating margins, increase our operating costs, harm our competitive position, and otherwise harm our business.
To enhance our users’ experience, we also offer our own lines of Roku-branded smart home products and services, and audio products, including wireless speakers and subwoofers. As a result, we face additional competition from other brands of smart home products and audio products. If these products do not operate as designed or do not enhance the TVs powered by the Roku OS or other viewing experiences as we intend, our users’ overall viewing experience may be diminished, and this may impact the overall demand for our products and our partners’ Roku TV models.
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Our future growth depends our ability to grow revenues from advertising on our streaming platform.*
We operate in a highly competitive advertising industry and compete for revenue from advertising with other streaming platforms and services, including social media and other digital platforms, as well as traditional media, such as radio, broadcast, cable and satellite TV, and satellite and internet radio. These competitors offer content and other advertising mediums that may be more attractive to advertisers than our streaming platform. These competitors are often very large and have more advertising experience and financial resources than we do, which may adversely affect our ability to compete for advertisers and may result in lower revenue and gross profit from advertising, and lower ARPU and Free Cash Flow. For example, many major SVOD services, including Netflix, Disney+, and Amazon Prime Video now have ad-supported SVOD tiers, which has further increased competition for streaming TV advertising revenue. These services, as well as other services such as YouTube, Tubi, and Pluto, sell (either through direct sales or programmatically through third parties) ad inventory in their ad-supported content that is distributed on our streaming platform. If we are unable to increase our revenue from advertising by, among other things, continuing to improve our streaming platform’s capabilities to further optimize and measure advertisers’ campaigns; continuing to increase our streaming platform’s reach; increasing, differentiating, and selling our advertising inventory, including video ad inventory we sell in The Roku Channel, video ad inventory that we acquire through our streaming services distribution agreements, and native display ads on the Roku Home Screen and throughout our streaming platform; innovating our ad product offerings; and maintaining a strong advertising sales team and programmatic capabilities, our business and our growth prospects may be harmed. We may not be able to compete effectively or adapt to industry changes or trends, which would harm our ability to grow our advertising revenue and would harm our business.
Many advertisers continue to devote a substantial portion of their advertising budgets to advertising in traditional media or on other digital platforms, such as traditional TV, radio, print publications, and social media. The future growth of our business depends on the growth of advertising on TV streaming platforms and on advertisers increasing their spending on advertising on our streaming platform. Although traditional TV advertisers have shown growing interest in advertising on TV streaming platforms, we cannot be certain that their interest will continue to increase or that they will not revert to traditional TV advertising or shift their advertising spending to social media and other digital platforms (rather than to us). In addition, if we are unable to compete with social media and other digital platforms to win business from advertisers and advertising agencies who have traditionally advertised on these platforms, such as direct-to-consumer and small or medium-sized businesses, our ability to grow our business may be limited. If advertisers, or their agency relationships, do not perceive meaningful benefits of advertising on streaming TV platforms, the market may develop more slowly than we expect, which could adversely impact our operating results and our ability to grow our business.
Finally, there is political or regulatory pressure in some countries to limit streaming TV advertising (including limiting the advertising that may be associated with children’s content) or impose local content requirements on streaming TV services, which could pose a threat to our services.
We may not be successful in our efforts to further monetize our streaming platform, which may harm our business.*
Our business model depends on our ability to generate platform revenue from advertisers and content partners through ad-supported content and native display ads. We generate platform revenue primarily from the sale of digital advertising (including direct and programmatic video advertising, media and entertainment promotional spending, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls). As such, we are seeking to expand the number of Streaming Households and increase Streaming Hours in an effort to create additional platform revenue opportunities. As our user base grows and as we increase the amount of content offered and streamed across our platform, we must effectively monetize our expanding user base and streaming activity. The total number of Streaming Hours, however, does not correlate with platform revenue on a period-by-period basis, primarily because we do not monetize every hour streamed or every user on our platform. Moreover, Streaming Hours on our platform are measured whenever a Roku streaming device is streaming content, whether a viewer is actively watching or not. For example, if a player is connected to a TV, and the viewer turns off the TV, steps away, or falls asleep and does not stop or pause the player, then the particular streaming app may continue to play content for a period of time determined by the streaming app (although all Roku devices include a Roku OS feature that is designed to identify when content has been continuously streaming on an app for an extended period of time without user interaction, which periodically prompts the user to confirm that they are still watching the selected app and closes the app if the user does not respond affirmatively).
Our ability to deliver advertisements relevant to our users and to increase our streaming platform’s value to advertisers and content partners depends on the collection of user engagement data, which may be restricted or prevented by a number of factors, including the evolving data protection legal landscape. Users may decide to opt out or restrict our ability to collect viewing data or to provide them with more relevant advertisements. Content partners may also refuse to allow us to collect data regarding user engagement or refuse to implement mechanisms we request to ensure compliance with our legal obligations or technical requirements. For example, we are not able to fully utilize program level viewing data from many of our most popular apps to improve the relevancy of advertisements provided to our users.
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Other apps available on our streaming platform, such as Amazon Prime Video, Apple TV+, Hulu, and YouTube, are focused on increasing user engagement and time spent within their apps by allowing users to purchase additional content and streaming services within their apps; when users purchase these additional services within these apps, we may earn less revenue than when the services are purchased directly from us. If our users spend most of their time within particular apps where we have limited or no ability to place advertisements or leverage user information, or our users opt out from our ability to collect data for use in providing more relevant advertisements, we may not be able to achieve our expected growth in platform revenue, gross profit, or key performance metrics. Additionally, our distribution agreements with our most popular apps are renegotiated periodically; thus, even if we are currently able to monetize Streaming Hours within an app, we may not be able to do so in the future. If we are unable to further monetize our streaming platform, our business may be harmed.
Our efforts to monetize our streaming platform may not continue to grow as we expect, and our platform revenue growth has been, and may continue to be, lower than expected due to advertising inventory supply and demand imbalances, advertisers significantly curtailing or pausing advertising spending due to inflationary pressures, recessionary fears, or other reasons that are out of our control, or competitive pressures from video ad offerings on other TV streaming platforms or services. In addition, advertisers’ spending commitments, such as those we obtain in connection with annual TV Upfront presentations, are typically not fully binding, and the revenue we receive from such commitments may be less than the initially committed amount. This means that in order to materially increase the monetization of our streaming platform through the sale of video advertising, we will need to attract significantly more advertising dollars to our streaming platform as well as deliver ad-supported content that results in our users streaming significantly more ad-supported content. Accordingly, there can be no assurance that we will be successful in monetizing our streaming platform through the distribution of ad-supported content.
If we are not successful in working with third-party demand sources or in running our demand-side platform (“DSP”), our business may be harmed.*
Advertisers and advertising agencies can programmatically purchase and manage their streaming TV, desktop, and mobile advertising campaigns both off and on the Roku platform through third-party demand sources (such as third-party DSPs and supply-side platforms (“SSPs”)) and OneView (our proprietary DSP). The market for programmatic streaming TV ad buying is an evolving market, and our current and potential advertisers and advertising agencies may not continue to shift to programmatic ad buying from other buying methods as quickly as we expect or at all. If the market for programmatic streaming TV ad buying deteriorates or develops more slowly than we expect, advertisers and advertising agencies may not use DSPs or SSPs, and our business could be harmed. If we are unable to expand our programmatic demand by maintaining and developing third-party demand relationships in a way that is competitive with other advertising platforms, our business could be harmed. In addition, if DSPs or SSPs do not have the functionality or services expected by advertisers or advertising agencies, they may take their advertising spend to a non-Roku platform. We also may not be able to adapt to changes or trends in programmatic streaming TV advertising, which would harm our ability to grow our advertising revenue and harm our business.
Our growth depends in part on our ability to develop, maintain, and expand relationships with our licensed Roku TV partners and manufacturing partners and, to a lesser extent, service operators.
We license the Roku OS and our smart TV reference designs to certain TV brand and manufacturing partners for the development, manufacture, and commercialization of licensed Roku TV models. We have developed, and intend to continue to develop and expand, relationships with these TV brand and manufacturing partners. We continue to invest in the growth and expansion of our Roku TV program both in the United States and international markets. For a number of years, the sale of Roku TV models by our licensed Roku TV partners has materially contributed to growth in our Streaming Households and Streaming Hours and supported our platform monetization efforts. This growth has primarily been driven by North America; however, our Roku TV licensing program has been expanded to certain international markets and has represented an increased share of new Streaming Households. We do not typically receive, nor do we typically expect to receive, license revenue from these arrangements, but we typically incur operating expenses in connection with establishing and supporting these commercial agreements.
The primary economic benefits that we derive from these license arrangements have been and will likely continue to be indirect, primarily from growing our Streaming Households, increasing Streaming Hours, and thereby enabling us to generate more streaming services distribution and advertising-related revenue on our platform. If these arrangements do not continue to result in increased Streaming Households and Streaming Hours, and if that growth does not in turn lead to successfully monetizing that increased user activity, our business may be harmed.
The loss of a relationship with a licensed Roku TV partner (including as a result of our launch of Roku-branded TVs that are designed, made, and sold by us) could harm our results of operations, damage our reputation, increase pricing and promotional pressures from other partners and retail distribution channels, increase our marketing costs, and result in the loss of revenue. If we are not successful in maintaining existing and creating new relationships with any of these third parties, or if we encounter technological, content licensing, or other impediments to these relationships, our ability to grow or maintain our business could be adversely impacted.
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We have also developed licensing relationships with certain service operators, primarily in international markets; however, this program has been decreasing in scale in recent years, and as a result we have shifted the focus of our international growth to the sale of Roku streaming devices and expanding our Roku TV licensing program. Based on the decreasing scale of our licensing program for service operators, including termination of these relationships, we expect that the number of Streaming Households generated from this program will continue to decline, which may impact the overall growth rate of our Streaming Households in international markets.
Our Roku TV licensing arrangements are complex and time-consuming to negotiate and complete. Our current and potential partners include TV brands, retailers, cable and satellite companies, and telecommunication providers. Under these license arrangements, we generally have limited or no control over the amount and timing of resources these entities dedicate to the relationship. In the past, our licensed Roku TV partners have failed to meet their forecasts and anticipated market launch dates for distributing Roku TV models, and they may fail to meet their forecasts or such launches in the future. If our licensed Roku TV partners or service operator partners fail to meet their forecasts or such launches for distributing licensed streaming devices or choose to deploy competing streaming solutions within their product lines, our business may be harmed.
We depend on a small number of content partners for a majority of our Streaming Hours, and if we fail to maintain these relationships, our business could be harmed.*
Historically, a small number of content partners have accounted for a significant portion of the hours streamed on our platform. In the three months ended September 30, 2024, the top three streaming services (excluding The Roku Channel) represented over 50% of all hours streamed in the period. If, for any reason, we cease distributing apps that have historically streamed a large percentage of the aggregate Streaming Hours on our platform, our Streaming Hours, our Streaming Households, or Roku streaming device sales may be adversely affected, and our business may be harmed.
If popular or new content publishers do not publish content on our streaming platform, we may fail to retain existing users and attract new users.*
We must continuously maintain existing relationships and identify and establish new relationships with content publishers to provide popular streaming apps, streaming app features, and content. In order to remain competitive, we must consistently meet user demand for popular streaming apps, streaming app features, and content, particularly as we launch new streaming devices, introduce new TVs powered by the Roku OS, or enter new markets, including international markets. This may be challenging as the industry continues to evolve, including through consolidation of content publishers, joint ventures among content publishers, and licensing of content between content publishers. If we are not successful in helping our content publishers launch and maintain streaming apps and streaming app features that attract and retain a significant number of users on our streaming platform or if we are not able to do so in a cost-effective manner, our business will be harmed. Our ability to successfully help content publishers maintain and expand their app offerings on a cost-effective basis largely depends on our ability to:
•effectively promote and market new and existing streaming apps;
•minimize launch delays of new and updated streaming apps; and
•minimize streaming platform downtime and other technical difficulties.
In addition, if service operators, including traditional TV providers, refuse to grant our users access to stream certain apps or only make content available on devices they prefer, our ability to offer a broad selection of popular streaming apps or content may be limited. If we fail to help our content publishers maintain and expand their audiences on our streaming platform or their apps are not available on our streaming platform, our business may be harmed.
The non-renewal or early termination of agreements with our content partners may result in the removal of certain apps or app features from our streaming platform and may harm our streaming device sales, Streaming Household growth, and engagement.
We enter into agreements with all our content partners, which have varying terms and conditions, including expiration dates and rights to terminate under certain circumstances. Our agreements with content partners generally have terms of one to three years and can be terminated before the end of the term by the content partner under certain circumstances, including if we materially breach the agreement, become insolvent, enter bankruptcy, commit fraud, or fail to adhere to the content partners’ security or other platform certification requirements.
Upon expiration of these agreements, we are required to re-negotiate and renew them in order to continue providing content from these content partners on our streaming platform. We have in the past been unable, and in the future may not be able, to reach a satisfactory agreement with certain content partners before our existing agreements have expired. If we are unable to renew such agreements on a timely basis on mutually agreeable terms, or if a content partner terminates an agreement with us prior to its expiration, we may be required to temporarily or permanently remove certain apps or app features from our streaming platform.
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The loss of such apps or app features from our streaming platform for any period of time may harm our business. More broadly, if we fail to maintain our relationships with the content partners on terms favorable to us, or at all, or if these content partners face problems in delivering their content across our streaming platform, we may lose app partners or users and our streaming device sales, Streaming Household growth, and engagement may be harmed.
If we are unable to maintain an adequate supply of quality video ad inventory on our streaming platform or generate sufficient demand to effectively sell our available video ad inventory, our business may be harmed.*
Our business model depends on our ability to grow video ad inventory on our streaming platform and sell it to advertisers. While The Roku Channel has historically served as a valuable source of video ad inventory for us to sell, there is no guarantee that it will continue to do so in the future. If The Roku Channel is unable to secure content that is appealing to our users and advertisers, or is unable to do so on terms that provide a sufficient supply of ad inventory at reasonable cost, our supply of video ad inventory will be negatively impacted. We are also dependent on our ability to monetize video ad inventory within other ad-supported apps on our streaming platform. We seek to obtain the ability to sell such inventory from the content partners of such apps. We may fail to attract content partners that generate a sufficient quantity or quality of ad-supported content hours on our streaming platform or fail to obtain access to a sufficient quantity and quality of ad inventory from the publishers of such content. Our access to video ad inventory in ad-supported streaming apps on our streaming platform varies greatly among apps. Accordingly, we may not have access to a significant portion of the video ad inventory on our streaming platform. For certain apps, including YouTube’s ad-supported app, we have no access to video ad inventory at this time and we may not secure access in the future. Moreover, when existing SVOD services introduce new ad-supported tiers to their streaming services, we have in the past and in the future may not be able to reach agreement on access to video ad inventory on these tiers on mutually agreeable terms, or at all. The amount, quality, and cost of video ad inventory available to us can change at any time. If we are unable to grow and maintain a sufficient supply of quality video ad inventory at reasonable costs to keep up with demand, our business may be harmed. Further, even if we have an adequate supply of quality video ad inventory, we may not be able to generate sufficient demand for such ad inventory or sell the ad inventory at our desired price. If we are unable to effectively sell our available video ad inventory, our business may be harmed.
If our content partners do not participate in new features that we may introduce from time to time, our business may be harmed.*
As our streaming platform and products evolve, we will continue to introduce new features, which may or may not be attractive to our content partners or meet their requirements. For example, some content partners have elected not to participate in new Roku Home Screen Menu features or in our Roku Zones (collections of related content from apps across our streaming platform) or have imposed limits on our data gathering for usage within their apps. In addition, our streaming platform utilizes our proprietary Brightscript scripting language in order to allow our content partners to develop and create apps on our streaming platform. Certain content partners may find other languages, such as HTML5, more attractive to develop for and shift their resources to developing their apps on other platforms. If key content partners do not find our streaming platform simple and attractive to develop apps for, do not value and participate in all of the features and functionality that our streaming platform offers, or determine that our software developer kit or new features of our platform do not meet their requirements, our business may be harmed.
If the advertising campaigns on our streaming platform decrease, or the campaigns that run are not relevant or not engaging to our users, our business may be adversely impacted.*
We have made, and are continuing to make, investments to engage with more advertisers and content partners, and enable them to deliver more relevant advertising campaigns to our viewers. However, a small number of content partners historically have accounted for a significant portion of the media and entertainment promotional spending campaigns on our streaming platform, and consolidation among content partners has in the past resulted, and may in the future result, in decreased media and entertainment promotional spending campaigns on our streaming platform. If our content partners decrease the media and entertainment promotional spending campaigns on our streaming platform, our financial condition and operating results may suffer, and our business may be harmed.
In addition, existing and prospective advertisers may not be successful in serving advertising campaigns that lead to and maintain viewer engagement. Those ads and campaigns may seem irrelevant, repetitive, or overly targeted and intrusive. For example, viewers may dislike the content and frequency of advertising that appears on the Roku Home Screen. We are continuously seeking to balance the objectives of our advertisers with our desire to provide an optimal viewer experience, but we may not be successful in achieving a balance that continues to attract and retain viewers, advertisers, and content partners.
If the advertising campaigns on our streaming platform are not relevant, are overly intrusive, or are too frequent and impede the use of our platform, our viewers may stop using our platform, resulting in a reduction of our Streaming Households and Streaming Hours, which will harm our business, financial condition and operating results.
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We are subject to various risks in connection with our operation and monetization of The Roku Channel.*
We operate The Roku Channel, which offers ad-supported free access for users to a collection of films, television series, live linear television, and other content. We have incurred, and will continue to incur, costs and expenses in connection with the development, expansion, and operation of The Roku Channel, which we monetize primarily through advertising. We also commission original content that we own and distribute on The Roku Channel. From time to time, we may remove underperforming content from The Roku Channel and record an impairment charge related to such removal, as we did in fiscal year 2023 and during the three months ended June 30, 2024.
If our users do not continue to stream the ad-supported content we make available on The Roku Channel, we will not have the opportunity to monetize The Roku Channel through revenue generated from advertising. In order to attract users to the ad-supported content on The Roku Channel and drive streaming of ad-supported video on The Roku Channel, we must secure rights to stream content that is appealing to our users and advertisers. In part, we do this by directly licensing certain content from content owners, such as television and movie studios. The agreements that we enter into with these content owners have varying terms and provide us with rights to make specific content available through The Roku Channel during certain periods of time. Upon expiration of these agreements, we are required to re-negotiate and renew these agreements with the content owners, or enter into new agreements with other content owners, in order to obtain rights to distribute additional titles or to extend the duration of the rights previously granted. If we are unable to enter into content license agreements on acceptable terms to access content that enables us to attract and retain users of the ad-supported content on The Roku Channel, or if the content we do secure rights to stream is ultimately not appealing to our users and advertisers, usage of The Roku Channel may decline, and our business may be harmed. Further, even if we successfully monetize The Roku Channel in the United States, we may not be successful in monetizing The Roku Channel in international markets.
In addition, we produce content for distribution on The Roku Channel and other platforms. We have limited experience producing content, and we may not be successful in doing so in a cost-effective manner that is appealing to our users and advertisers and furthers the growth of The Roku Channel. We also take on risks associated with content production, such as completion and key talent risk. Furthermore, if the advertisements on The Roku Channel are not relevant to our users or such advertisements are overly intrusive and impede our users’ enjoyment of the available content, our users may not stream content and view advertisements on The Roku Channel, and The Roku Channel may not generate sufficient revenue from advertising to be cost effective for us to operate. In addition, we distribute The Roku Channel on platforms other than our own streaming platform, and there can be no assurance that we will be successful in attracting a large number of users or generating significant revenue from advertising through the distribution of The Roku Channel on such other streaming platforms.
If our users sign up for offerings and services outside of our streaming platform or through other apps on our streaming platform, our business may be harmed.
We earn revenue by acquiring subscribers for certain of our content partners activated on or through our streaming platform, including Premium Subscriptions on The Roku Channel, which allow our users to pay for content from various content partners. If users reduce the degree to which they use our streaming platform for these purchases or subscriptions for any reason, and instead increase the degree to which they pay for services directly with content partners or by other means for which we do not receive attribution, our business may be harmed.
In addition, certain apps available on our streaming platform allow users to purchase additional streaming services from within those apps. The revenue we earn from these transactions is not always equivalent to the revenue we earn from sales of such additional services on a stand-alone basis through our streaming platform. If users increase their spending on such in-app transactions at the expense of stand-alone purchases through our streaming platform, our business may be harmed.
We and our licensed Roku TV partners depend on retail sales channels to effectively market and sell our respective products, and if we or our partners fail to maintain and expand effective retail sales channels, we or our partners could experience lower product sales.*
To continue to grow our Streaming Households, we must maintain and expand retail sales channels for our products and for the Roku products sold by our partners or licensees. The majority of our products and our licensed Roku TV partners’ products are sold through traditional brick and mortar retailers, such as Best Buy, Costco, Target, and Walmart, including their online sales platforms, and online retailers such as Amazon.
We also sell certain products directly through our website and internationally through distributors and retailers such as Coppel in Mexico, Magazine Luiza in Brazil, MediaMarkt in Germany, and Currys in the United Kingdom. As we have only recently expanded to certain international markets, we may not have established a strong reputation or relationships with retailers for those markets as compared to our retail sales channels in the United States or our competitors in international markets.
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Our retailers and distributors also sell products that compete with our products and our licensed Roku TV partners’ products, including house-branded televisions sold by such retailers that utilize TV operating systems other than the Roku OS. We have no minimum purchase commitments or long-term contracts with any of these retailers or distributors, and there can be no assurance that we will reach agreements with our retailers and distributors on terms we find acceptable or that will be consistent with our past practices. We may be reliant on certain retailers or distributors. Amazon, Best Buy, Target, and Walmart in total accounted for 78% of our devices revenue for both the three months ended September 30, 2024 and September 30, 2023. Furthermore, our licensed Roku TV partners may be reliant on the same retailers and distributors or other retailers and distributors for a significant portion of their unit sales of Roku TV models. If one or several retailers or distributors were to discontinue selling our products or our licensed Roku TV partners’ products, choose not to prominently display those products in their stores or on their websites, or close or severely limit access to their brick and mortar locations, the volume of our products or our licensed Roku TV partners’ products sold could decrease, which would harm our business. These risks may be exacerbated by our reliance on certain retailers or distributors, or when a major retailer in a jurisdiction commercializes televisions under brands that the retailer controls.
In addition, if any of our existing licensed Roku TV partners choose to work exclusively with, or divert a significant portion of their business with us to, other operating system developers, this may adversely impact our ability to continue to license the Roku OS and our smart TV reference design to TV brands and to grow Streaming Households and monetize the Roku OS. Traditional retailers have limited shelf and end cap space in their stores and limited promotional budgets, and online retailers have limited prime website product placement space. Competition is intense for these resources, and a competitor with more extensive product lines, stronger brand identity and greater marketing resources, such as Amazon or Google, possesses greater bargaining power with retailers. In addition, one of our online retailers, Amazon, sells its own competitive streaming devices, smart TVs, and smart home devices, is able to market and promote these products more prominently on its website, and could refuse to offer or promote our products on its website. If Walmart’s pending acquisition of Vizio is consummated, we may face increased competition within Walmart, which currently makes and sells Onn. branded streaming products, including co-branded Roku TV models. Any reduction in our ability to place and promote our products, or increased competition for available shelf or website placement, could require us to increase our marketing or other expenditures to maintain our product visibility or could result in reduced visibility for our products, which may harm our business. In particular, the availability of product placement during peak retail periods, such as the holiday season, is critical to our revenue growth, and if we are unable to effectively sell our products during these periods, our business would be harmed.
If our efforts to build a strong brand and maintain customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed.
Building and maintaining a strong brand is important to attract and retain users, as potential users have a number of TV streaming choices. Successfully building a brand is a time-consuming and comprehensive endeavor, and our brand may be negatively impacted by factors that are out of our control, such as the quality and reliability of the Roku TV models made by our licensed Roku TV partners and the quality of the content that our content partners provide. Our competitors may be able to achieve and maintain brand awareness and consumer demand for their products more quickly and effectively than we can. Many of our competitors are larger companies and may have greater resources to devote to the promotion of their brands through traditional advertising, digital advertising, or website product placement. If we are unable to execute on building a strong brand, it may be difficult to differentiate our business and streaming platform from our competitors in the marketplace, which may adversely affect our ability to attract and retain users and harm our business.
Our streaming platform allows our users to choose from a wide variety of apps, representing a variety of content from a wide range of content partners. Our users can choose and control which apps they download and watch, and they can use certain settings to prevent apps from being downloaded to Roku streaming devices. While we have policies that prohibit the publication of content that is unlawful, incites illegal activities, or violates third-party rights, among other things, we may distribute apps that include controversial content. Controversies related to the content included on certain apps that we distribute have resulted in, and could in the future result in, negative publicity, cause harm to our reputation and brand, or subject us to claims and may harm our business.
We are subject to payment-related risks and, if our advertisers, advertising agencies, or programmatic partners do not pay or dispute their invoices, our business may be harmed.*
Many of our contracts with advertising agencies provide that if the advertiser does not pay the agency, the agency is not liable to us, and we must seek payment solely from the advertiser, a type of arrangement called sequential liability. Contracting with these agencies, which in some cases have or may develop higher-risk credit profiles, may subject us to greater credit risk than if we were to contract directly with advertisers.
This credit risk may vary depending on the nature of an advertising agency’s aggregated advertiser base. In addition, typically, we are contractually required to pay advertising inventory data suppliers within a negotiated period of time, regardless of whether our advertisers or advertising agencies pay us on time, or at all. Further, we typically experience slow payment cycles by advertising agencies as is common in the advertising industry. While we attempt to balance payment periods with our suppliers and advertisers and advertising agencies, we are not always successful. As a result, we can often face a timing issue with our accounts payable on shorter cycles than our accounts receivables, requiring us to remit payments from our own funds, and accept the risk of credit losses.
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We may also be involved in disputes with agencies, their advertisers, or our programmatic partners over the operation of our streaming platform, the terms of our agreements, or our billings for purchases made by them through our streaming platform, our DSP, or other programmatic partners. If we are unable to collect or make adjustments to bills, we could incur credit losses, which could have a material adverse effect on our results of operations for the periods in which the write-offs occur. In the future, bad debt may exceed reserves for such contingencies, and our bad debt exposure may increase over time. Any increase in write-offs for bad debt could have a materially negative effect on our business, financial condition, and operating results. If we are not paid by our advertisers or advertising agencies on time or at all, our business may be harmed.
The quality of our customer support is important, and if we fail to provide adequate levels of customer support, we could lose users, advertisers, content partners, and licensed Roku TV partners, which could harm our business.
Our users depend on our customer support organization to resolve issues relating to our products and our streaming platform. A high level of support is critical for the success of our business. We currently outsource the majority of our customer support operation to a third-party customer support organization which provides support to end users. In addition, we train our licensed Roku TV partners and service operator licensees to provide first-level customer support to users of Roku TV models and other devices. If we do not effectively train, update, and manage our third-party customer support organization to assist our users and licensees, and if that support organization does not succeed in helping them quickly resolve issues or provide effective ongoing support, it could adversely affect our ability to monetize our streaming platform, to sell our products to users and could harm our reputation with potential new customers and our licensees.
We must continue to innovate and develop new and existing products and services to remain competitive, and new products and services expose our business to new risks.*
We must continually innovate and improve our products and services and develop new products and services to meet changing consumer demands. The introduction of a new product or service is a complex task, involving significant expenditures in research and development, promotion, and sales channel development, and can expose our business to new risks. The introduction of new products and services or changes to our existing products and services may result in new or enhanced governmental or regulatory scrutiny, new litigation or claims, or other complications that could adversely affect our business, reputation, or financial results. In addition, our entrance into entirely new lines of business beyond our historical core business of TV streaming and advertising, such as our Roku-branded smart home products, may change our risk profile and subject us to risks that differ from the risks we face as a result of our historical TV streaming business.
Whether users will broadly adopt our new products or services is not certain. Our future success will depend on our ability to develop new and competitively priced products and services and add new desirable content and features to our streaming platform. Moreover, we must introduce new products and services in a timely and cost-effective manner, and we must secure production orders for new products from our contract manufacturers. The development of new products and services is a highly complex process, and we do not expect that all of our projects will be successful.
The successful development and introduction of new products and services depends on a number of factors, including:
•the accuracy of our forecasts for market requirements beyond near-term visibility;
•our ability to anticipate and react to new technologies and evolving consumer trends;
•our development, licensing, or acquisition of new technologies;
•our timely completion of new designs and development;
•our ability to timely and adequately redesign or resolve design or manufacturing or security issues;
•our ability to identify and contract with an appropriate manufacturer;
•the ability of our contract manufacturers to cost-effectively manufacture our new products;
•the availability of materials and key components used in manufacturing;
•tariffs, trade, sanctions, and export restrictions by the U.S. or foreign governments;
•the ability of our contract manufacturers to produce quality products and minimize defects, manufacturing mishaps, shipping costs, and delays;
•our ability to obtain required licenses and comply with other regulatory requirements; and
•our ability to attract and retain world-class research and development personnel.
If any of these or other factors materializes, we may not be able to develop and introduce new products or services in a timely or cost-effective manner, and our business may be harmed.
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We do not have our own manufacturing capabilities and primarily depend upon a limited number of contract manufacturers, and our operations could be disrupted if we encounter problems with our contract manufacturers.*
We do not have any internal manufacturing capabilities and rely on a limited number of contract manufacturers to build our players, smart home products, and Roku-branded TVs. Our contract manufacturers are vulnerable to, among other issues:
•capacity constraints;
•reduced component availability;
•production, supply chain, or shipping disruptions, delays, or increased costs, including from labor disputes, strikes, mechanical issues, quality control issues, natural disasters, geopolitical conflicts, and public health crises; and
•the impact of U.S. or foreign tariffs, trade, or sanctions restrictions on components, finished goods, software, other products, or data transfers.
As a result, we have limited control over delivery schedules, manufacturing yields, and costs, particularly when components are in short supply or when we introduce new products.
We also have limited control over our contract manufacturers’ quality systems and controls, and therefore must rely on them to manufacture our products to our quality and performance standards and specifications. Delays, component shortages, quality issues, and other manufacturing and supply problems in the past have impaired, and could in the future impair, the retail distribution of our products and ultimately our brand. Furthermore, any adverse change in our contract manufacturers’ financial or business condition could disrupt our ability to supply our products to our retailers and distributors.
We also rely upon our contract manufacturers and other contractors to perform some of the development work on our products. The contract manufacturers or other contractors may be unwilling or unable to successfully complete desired development or fix defects or errors in a timely manner. Delays in development work by contract manufacturers or contractors could delay launch of new or improved products.
Our contracts with our contract manufacturers generally may not contain terms that protect us against development, manufacturing, and supply disruptions or risks. For example, such contracts may not obligate our contract manufacturers to supply our products in any specific quantity or at any specific price. If our contract manufacturers are unable to fulfill our production requirements in a timely manner, if their costs increase because of inflationary pressures, U.S. or international tariffs, sanctions, export or import restrictions, or if they decide to terminate their relationship with us, our order fulfillment may be delayed or terminated, and we would have to attempt to identify, select, and qualify acceptable alternative contract manufacturers.
Alternative contract manufacturers may not be available to us when needed or may not be in a position to satisfy our production requirements at commercially reasonable prices, to our quality and performance standards on a timely basis, or at all. Any significant interruption in manufacturing at our contract manufacturers for any reason could require us to reduce our supply of products to our retailers and distributors, which in turn would reduce our revenue, or incur higher freight costs than anticipated, which would negatively impact our devices gross margin.
In addition, our contract manufacturers’ facilities, and the facilities of our contract manufacturers’ suppliers, are located in various geographic areas that may be subject to political, economic, labor, trade, public health, social, and legal uncertainties, including Taiwan, Vietnam, China, and Brazil, and such uncertainties may harm or disrupt our relationships with these parties or their ability to perform. For example, if the tensions between Taiwan and China escalate and impact the operations of our contract manufacturers and their Taiwanese suppliers, our supply chain and our business could be adversely affected. We believe that the international location of these facilities increases supply risk, including the risk of supply interruptions, tariffs, and trade restrictions on exports or imports.
The supply of Roku TV models to the market could be disrupted if our licensed Roku TV partners encounter problems with their internal operations or with their contract manufacturers, assemblers, or component suppliers.*
Some of our licensed Roku TV partners have internal manufacturing capabilities, while others rely primarily or exclusively upon contract manufacturers to build the Roku TV models that our licensed Roku TV partners sell to retailers. Regardless of whether their manufacturing capabilities are internal or contracted, our licensed Roku TV partners’ manufacturers may be vulnerable to capacity constraints and reduced component availability; increases in tariffs on imports of Roku TV models; future possible changes in regulations on exports; restrictions, by the United States or otherwise, on dealings with certain countries, companies, or imported inputs; tariffs on parts or components for Roku TV models; and supply chain disruptions, increased shipping costs, and shipping delays.
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Our licensed Roku TV partners’ control over delivery schedules, manufacturing yields, and costs, particularly when components are in short supply, may be limited. For those licensed Roku TV partners with contract manufacturers or suppliers, the problems are exacerbated because the contract manufacturer is a third party, and the licensed Roku TV partner does not have direct visibility into or control over the operations. Delays, component shortages, and other manufacturing and supply problems could impair the manufacture or distribution of Roku TV models. Interruptions in the supply of Roku TV models to retailers and distributors or increases in the pricing of Roku TV models at times have negatively affected, and could adversely affect in the future, the volume of Roku TV models sold at retail, resulting in slower Streaming Households and Streaming Hours growth.
Furthermore, any manufacturing, design, or other issues affecting the quality or performance of Roku TV models could harm our brand and our business.
If we fail to accurately forecast our manufacturing requirements for our products and manage our inventory with our contract manufacturers, we could incur additional costs, experience manufacturing delays, and lose revenue.
We bear risks of excess and insufficient inventories under our contract manufacturing arrangements. For example, our contract manufacturers order materials and components in advance in an effort to meet our projected needs for our products. Lead times for the materials and components that our contract manufacturers order on our behalf through different component suppliers may vary significantly and depend on numerous factors outside of our control, including the specific supplier, contract terms, shipping and freight, market demand for a component at a given time, and trade and government relations. Lead times for certain key materials and components incorporated into our products are currently lengthy and may require our contract manufacturers to order materials and components many months in advance. If we overestimate our production requirements, our contract manufacturers may purchase excess components and build excess inventory. If our contract manufacturers, at our request, purchase excess components or build excess products, we could be required to pay for these excess components or products. In the past, we have agreed to reimburse our contract manufacturers for purchased components that were not used as a result of our decision to discontinue a certain model or the use of particular components. If we incur costs to cover excess supply commitments, our business may be harmed.
Conversely, if we underestimate our product requirements, our contract manufacturers may have inadequate material or component inventory, which could interrupt the manufacturing of our products, result in insufficient quantities available to meet demand, and result in delays or cancellation of orders from retailers and distributors. In addition, from time to time we have experienced unanticipated increases in demand that resulted in the need to ship our products via air freight, which is more expensive than ocean freight, and adversely affected our devices gross margin during such periods of high demand (for example, during end-of-year holidays). If we fail to accurately forecast our manufacturing requirements, our business may be harmed.
Our products incorporate key components from sole source suppliers, and if our contract manufacturers are unable to obtain sufficient quantities of these components on a timely basis, we will not be able to deliver our products to our retailers and distributors.
We depend on sole source suppliers for key components in our products. For example, each of our streaming players and TVs powered by the Roku OS may utilize a specific system on chip (or SoC), Wi-Fi silicon product, and Wi-Fi front-end module, each of which may be available from only a single manufacturer and for which we do not have a second source.
Although this approach allows us to maximize product performance on lower cost hardware, reduce engineering development and qualification costs, and develop stronger relationships with our strategic suppliers, this also creates supply chain risk. These sole-source suppliers could be constrained by fabrication capacity issues or material supply issues, such as U.S. or foreign tariffs, war or other government or trade relations issues, other export or import restrictions on parts or components for finished products that are used in final assembly of their components (or on the finished products themselves), or shortages of key components.
There is also a risk that the strategic supplier may stop producing such components, cease operations, be acquired by or enter into exclusive arrangements with our competitors or other companies, put contract manufacturers on allocation because of semiconductor shortages, or become subject to U.S. or foreign sanctions or export control restrictions or penalties. Such suppliers have experienced, and may in the future experience, production, shipping, or logistical constraints arising from macroeconomic conditions or other circumstances, such as inflationary pressures, geopolitical conflict, and supply chain disruptions. Such interruptions and delays have in the past and may in the future force us to seek similar components from alternative sources, which may not always be available, and which may cause us to delay product introductions and incur air freight expense. Switching from a sole-source supplier may require that we adapt our software and redesign our products to accommodate new chips and components, and may require us to re-qualify our products with regulatory bodies, such as the U.S. Federal Communications Commission (“FCC”), which would be costly and time-consuming.
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Our reliance on sole-source suppliers involves a number of additional risks, including risks related to:
•supplier capacity constraints;
•price increases, including those related to inflationary pressures, tariffs, and material costs;
•timely delivery;
•component quality; and
•delays in, or the inability to execute on, a supplier roadmap for components and technologies.
Any interruption in the supply of sole-source components for our products could adversely affect our ability to meet scheduled product deliveries to our retailers and distributors, result in lost sales and higher expenses, and harm our business.
If our products do not operate effectively with various offerings, technologies, and systems from content partners and other third parties that we do not control, our business may be harmed.*
The Roku OS is designed to perform using relatively low-cost hardware, which enables us to drive user growth via Roku streaming devices offered at a low cost to users. However, this hardware must be interoperable with all apps and other offerings, technologies, and systems from our content partners, including virtual multi-channel video programming distributors, and other third parties. We have no control over these offerings, technologies, and systems beyond our app certification requirements, and if Roku streaming devices do not provide our users with a high-quality experience on those offerings on a cost-effective basis or if changes are made to those offerings that are not compatible with Roku streaming devices, we may be unable to increase Streaming Household growth and user engagement or may be required to increase our hardware costs, and our business will be harmed.
We plan to continue to introduce new products regularly, including, for example, the Roku-branded TVs we launched in 2023 and the Roku Pro Series TVs launched in April 2024, and we have experienced that it takes time to optimize such products to function well with these offerings, technologies and systems. In addition, many of our largest content partners have the right to test and certify our new products before we can publish their apps. The certification processes can be time-consuming and introduce third-party dependencies into our product release cycles. If our content partners do not certify new products on a timely basis or require us to make changes in order to obtain certifications, our product release plans may be adversely impacted, we may not be able to offer certain products to all licensed Roku TV partners or we may not continue to offer certain apps. To continue to grow our Streaming Households and user engagement, we will need to prioritize development of Roku streaming devices to work better with new offerings, technologies, and systems, including our smart home products and services. If we are unable to maintain consistent operability of Roku streaming devices that is on parity with or better than other platforms, our business could be harmed.
In addition, any future changes to offerings, technologies, and systems from our content partners may impact the accessibility, speed, functionality, and other performance aspects of Roku streaming devices. We may not successfully develop Roku streaming devices that operate effectively with these offerings, technologies, or systems. If it becomes more difficult for our users to access and use these offerings, technologies, or systems, our business could be harmed.
Our products are complex and may contain hardware defects and software errors, which could manifest themselves in ways that could harm our reputation and our business.*
Our products and the products of our licensed Roku TV partners are complex and have contained and may in the future contain hardware defects or software errors. These defects and errors can manifest themselves in any number of ways in our products or our streaming platform, including through diminished performance, security vulnerabilities, data loss or poor quality, device malfunctions, account inactivity, or even permanently disabled products. Some errors may only be discovered after a product has been shipped and used by users and may in some cases only be detected under certain circumstances or after extended use. We update our software on a regular basis, and, despite our quality assurance processes, we could introduce software errors in the process of any such update.
The introduction of a serious software error could result in products becoming permanently disabled. We offer a limited warranty for our products, in accordance with applicable law, however, providing software updates, product support, and other activities could cause us to be responsible for issues with products for an extended period of time. Any defects discovered in our products after commercial release could result in loss of revenue or delay in revenue recognition, loss of customer goodwill and users, and increased service costs, any of which could harm our business, operating results, and financial condition. We could also face claims for product or information liability, tort or breach of warranty, or other violations of laws or regulations. In addition, our contracts with our end users contain provisions relating to warranty disclaimers and liability limitations, which may not be upheld. Defending a lawsuit, regardless of its merit, is costly and may divert management’s attention and adversely affect the market’s perception of Roku and our products. In addition, if our insurance coverage proves inadequate or future coverage is unavailable on acceptable terms or at all, our business could be harmed.
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Components used in our products may fail as a result of manufacturing, design, or other defects that were unknown to us or over which we have no control and may render our products permanently inoperable.
We rely on third-party component suppliers to provide certain functionalities needed for the operation and use of our products. Any errors or defects in such third-party technology could result in errors or defects in our products that could harm our business. If these components have a manufacturing, design, or other defect, they could cause our products to fail and could render them permanently inoperable. For example, the typical means by which our users connect their home networks to our players is by way of a Wi-Fi access point in the home network router. If the Wi-Fi receiver or transmitter in a player fails and cannot detect a home network’s Wi-Fi access point, the player will not be able to display or deliver any content to the TV screen. As a result, we may have to recall and replace defective products, which could be at a considerable cost and expense. Should we have a widespread problem of this kind, our reputation in the market could also be adversely affected.
If we are unable to obtain or maintain necessary or desirable licenses, certifications, or approvals related to our use or support of third-party technology, intellectual property, or services, then our ability to develop and introduce new products and services, and continue to manufacture, update, and commercialize existing products and services, may be impaired.*
We use or enable in our products and services certain industry standard and other technology, intellectual property, and services that are obtained from third parties. As a result, in order to continue to make, distribute, update, and commercialize our existing products and services, and introduce and commercialize new products and services, we may be required to maintain certain licenses, certifications, and approvals from the relevant third parties and potentially license and otherwise obtain access to additional technologies, intellectual property, and products from third parties. The licenses, certifications, and approvals we need to obtain from third parties may be or become unavailable to us on commercially reasonable terms, if at all. If we are unable to obtain or maintain necessary third-party licenses, certifications, or approvals, we may have to obtain substitute technologies, intellectual property, or services with lower quality or performance standards, or at a greater cost, or remove desired functions and features from our products and services, any of which could harm customer and partner relationships, as well as the competitiveness of our products, services, and business.
Our products and services are designed to be compatible with numerous industry standards. In many cases, these industry standards have numerous associated patents known generally as standard essential patents (“SEPs”). Over time, SEP owners have increasingly turned away from licensing their SEPs through patent pools, preferring to license their portfolios directly. This has increased the number of licensors (since the patents are not pooled) and increased the time, cost, and difficulty of SEP licensing. If we are unable to obtain a license to a necessary SEP on commercially reasonable terms, or at all, or find a suitable substitute technology that complies with the industry standard, our customer and partner relationships, as well as the competitiveness of our products and services, and our business may be harmed.
We are incorporating AI technologies into some of our products and services, which may present operational and reputational risks.*
We have incorporated and intend to continue to incorporate AI technologies, such as generative AI, into our products and services. For example, we have introduced a generative-driven ad creation service for our advertisers to help them create ads more easily, and we continue to use AI technologies to power our content recommendation engine. As with many innovations, AI presents risks and challenges that could adversely impact our business. AI technologies can create accuracy issues, unintended biases, and discriminatory outcomes, or may create content that appears correct but is inaccurate or flawed. If the recommendations, content, or analyses that AI applications produce are or are alleged to be deficient or inaccurate, we could be subjected to competitive harm, potential legal liability, and brand or reputational harm. The legal and regulatory landscape surrounding AI technologies is rapidly evolving and uncertain, including in the areas of intellectual property, cybersecurity, and privacy and data protection. For example, there is uncertainty around the validity and enforceability of intellectual property rights related to the use, development, and deployment of AI technologies. Compliance with new or changing laws, regulations or industry standards relating to AI may impose significant operational costs and may limit our ability to develop, deploy or use AI technologies. There can be no assurance that the measures we have taken to mitigate the potential risks related to generative AI will be sufficient. Failure to appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm.
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Risks Related to Operating and Growing Our Business
We have incurred operating losses in the past, and although we have achieved profitability in certain prior quarters, we may continue to incur operating losses in the future and may not be able to achieve profitability again in the near term or at all.*
We have incurred operating losses in the past, and we may incur operating losses in the future. Although we achieved profitability in certain prior quarters, we may not be able to achieve profitability again in the near term or at all. As of September 30, 2024, we had an accumulated deficit of $1,391.4 million. Our operating expenses have increased in the past and may increase again in the future as we expand our operations and invest in growth and new areas. If our revenue and gross profit do not grow at a greater rate than our operating expenses, we may not be able to achieve profitability again. We expect our profitability to fluctuate in the future for a number of reasons, including without limitation the other risks and uncertainties described herein. Additionally, we may encounter unforeseen operating or legal expenses, difficulties, complications, delays, and other factors that may result in losses in future periods.
Our quarterly operating results may be volatile and are difficult to predict, and our stock price may decline if we fail to meet the expectations of securities analysts or investors.*
Our revenue, gross profit, key performance metrics (including Streaming Households, Streaming Hours, ARPU, and Free Cash Flow), and other operating results could vary significantly from quarter-to-quarter and year-to-year and may fail to match our past performance due to a variety of factors, including many factors that are outside of our control. Factors that may contribute to the variability of our operating results and cause the market price of our Class A common stock to fluctuate include:
•the entrance of new competitors or competitive products or services, whether by established or new companies;
•our ability to retain and grow our Streaming Households, increase engagement among new and existing users, and monetize our streaming platform;
•our ability to maintain effective pricing practices in response to the competitive markets in which we operate or other macroeconomic factors, such as increased taxes or inflationary pressures, such as those the market is currently experiencing, and our ability to control costs, including our operating expenses;
•our revenue mix, which drives gross profit;
•supply of advertising inventory on our platform and advertiser demand for advertising inventory on our platform;
•seasonal, cyclical, or other shifts in revenue from advertising or product sales;
•the timing of the launch of new or updated products, apps, or features;
•the addition or removal of content or apps from our streaming platform;
•the expense and availability of content to license or produce for The Roku Channel;
•the ability of retailers to anticipate consumer demand;
•an increase in the manufacturing or component costs of our products or partner-branded products;
•delays in delivery of our products or partner-branded products, or disruptions in our or our partners’ supply or distribution chains; and
•an increase in legal costs, including costs associated with protecting our intellectual property, defending against third-party intellectual property infringement allegations, or procuring rights to third-party intellectual property.
Our gross margins vary across our devices and platform offerings. Our devices segment (which generates revenue from the sale of streaming players, Roku-branded TVs, smart home products and services, audio products, and related accessories, as well as revenue from licensing arrangements with service operators) experienced negative gross margin for the three and nine months ended September 30, 2024, and our platform segment (which generates revenue from the sale of digital advertising (including direct and programmatic video advertising, media and entertainment promotional spending, and related services) and streaming services distribution (including subscription and transaction revenue shares, the sale of Premium Subscriptions, and the sale of branded app buttons on remote controls)) experienced positive gross margin for the three and nine months ended September 30, 2024. Gross margins on our streaming devices vary across models and can change over time as a result of product transitions, pricing and configuration changes, component costs, device returns, and other cost fluctuations.
In addition, our gross margin and operating margin percentages, as well as overall profitability, may be adversely impacted as a result of a shift in device, geographic, or retail sales channel mix, component cost increases, price competition, or the introduction of new products, including those that have higher cost structures with flat or reduced pricing. We have in the past and may in the future strategically reduce our devices gross margin or record negative gross margin on devices in an effort to increase the number of Streaming Households and grow our gross profit.
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As a result, our devices segment revenue may not increase as rapidly as it has historically, or at all, and, unless we are able to continue to increase our platform segment revenue and grow the number of Streaming Households, we may be unable to grow gross profit and our business will be harmed. For example, from time to time, global supply chain disruptions have resulted in shipping delays, increased shipping costs, component shortages, and increases in component prices, which negatively affected our devices gross margin. If a reduction in gross margin does not result in an increase in our Streaming Households or an increase in our platform revenue and gross profit, our financial results may suffer, and our business may be harmed. In addition, our platform segment has experienced in the past, and may experience in the future, lower gross margins than we anticipate. If our platform gross margins are lower than we anticipate, our financial results may suffer, and our business may be harmed.
If we have difficulty managing our growth in operating expenses, our business could be harmed.*
We have experienced significant growth in our research and development, sales and marketing, support services, operations, and general and administrative functions in recent years and may continue to expand certain of these activities. Our historical growth has placed, and any future growth will continue to place, significant demands on our management, as well as our financial and operational resources, to:
•manage a larger organization;
•hire more employees, including engineers with relevant skills and experience;
•expand internationally;
•increase our sales and marketing efforts;
•expand the capacity to manufacture and distribute our products;
•broaden our customer support capabilities;
•expand our product offerings;
•support our licensed Roku TV partners and service operators;
•expand and improve the content offering on our streaming platform;
•implement appropriate operational and financial systems; and
•maintain effective financial disclosure controls and procedures.
If we fail to manage our growth effectively, including if we grow our business too rapidly, we may not be able to execute our business strategies, which could harm our business and adversely affect our financial condition, results of operations, or cash flows.
We have previously undertaken restructuring plans to adjust our investment priorities and manage our operating expenses, and we may do so again in the future. We have incurred, and may in the future incur, material costs and charges in connection with restructuring plans and initiatives, and there can be no assurance that any restructuring plans and initiatives will be successful. Any restructuring plans may adversely affect our internal programs and our ability to recruit and retain skilled and motivated personnel, may result in a loss of continuity, loss of accumulated knowledge, or inefficiency during transitional periods, may require a significant amount of employees’ time and focus, and may be distracting to employees, which may divert attention from operating and growing our business. For more information, see Note 16 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report.
If we fail to achieve some or all of the expected benefits of any restructuring plans or are unable to manage our growth and expansion plans effectively, which may be impacted by factors outside of our control, our business, operating results, and financial condition could be adversely affected.
We may be unable to successfully expand our international operations, and our international expansion plans, if implemented, will subject us to a variety of risks that may harm our business.*
We currently generate the vast majority of our revenue in the United States and have limited experience marketing, selling, licensing, and supporting our products and running or monetizing our streaming platform outside the United States. In addition, we have limited experience managing the administrative aspects of a global organization. While we intend to continue to explore opportunities to expand our business in international markets in which we see compelling opportunities, we may not be able to create or maintain international market demand for our products and streaming platform services. Moreover, we face intense competition in international markets, especially because some of our competitors have already successfully introduced their products into new markets we are entering and have greater experience managing a global organization.
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In the course of expanding our international operations, we are subject to a variety of risks that could adversely affect our business, including:
•differing legal and regulatory requirements in foreign jurisdictions, including country-specific laws and regulations pertaining to data privacy and data security, consumer protection, tax, telecommunications, trade (including tariffs, quotas, and sanctions), labor, environmental protection, censorship and other content restrictions, use of AI technologies, copyright and intellectual property, and local content and advertising requirements, among others;
•exposure to increased corruption risk and compliance with laws such as the U.S. Foreign Corrupt Practices Act, UK Bribery Act, and other anti-corruption laws, U.S. or foreign export controls and sanctions, and local laws prohibiting improper payments to government officials and requiring the maintenance of accurate books and records and a system of sufficient internal controls;
•slower consumer adoption and acceptance of streaming devices and services in other countries;
•different or unique competitive pressures as a result of, among other things, competition with other devices that consumers may use to stream TV or existing local traditional TV services and products, including those provided by incumbent TV service providers and local consumer electronics companies;
•greater difficulty supporting and localizing Roku streaming devices and our streaming platform, including delivering support and training documentation in languages other than English;
•our ability to deliver or provide access to popular streaming apps or content to users in certain international markets;
•availability of reliable broadband connectivity in areas targeted for expansion;
•challenges and costs associated with staffing and managing foreign operations;
•differing legal and court systems, including limited or unfavorable intellectual property protection;
•unstable political and economic conditions, social unrest, or economic instability, whatever the cause, including due to pandemics, natural disasters, wars, terrorist activity, foreign invasions (such as the Russian invasion of Ukraine and the current conflict in the Middle East), tariffs, trade disputes, local or global recessions, diplomatic or economic tensions (such as the tension between China and Taiwan), long-term environmental risks, or climate change;
•adverse tax consequences, such as those related to changes in tax laws (including increased tax rates, the imposition of digital services taxes, and the adoption of global corporate minimum taxes and anti-base-erosion rules), changes in the interpretation of existing tax laws, and the heightened scrutiny by tax administrators of companies that have cross-border business activities;
•the imposition of customs duties on cross-border data flows for streaming services, in the event that the World Trade Organization fails to extend the current moratorium on such duties;
•any pandemics or epidemics, which could result in decreased economic activity in certain markets, changes in the use of our products or platform, or decreased ability to import, export, ship, or sell our products to supply such services to existing or new customers in international markets;
•inflationary pressures, such as those the global market is currently experiencing, which may increase costs for materials, supplies, and services;
•fluctuations in currency exchange rates, which could impact the revenue and expenses of our international operations and expose us to foreign currency exchange rate risk (see the section titled “Foreign Currency Exchange Rate Risk” in Part I, Item 3 of this Quarterly Report for additional information);
•restrictions on the repatriation of earnings from certain jurisdictions; and
•working capital constraints.
In addition, we may face challenges in successfully deploying our business model in international markets. Three core areas of focus define our business model: first, we grow scale by increasing our Streaming Households; second, we grow engagement by increasing the hours of content streamed through our streaming platform; and third, we grow monetization of the activities that users engage in through our streaming platform. Even if we are able to increase our Streaming Households in international markets, we may be unable to effectively grow our Streaming Hours or monetize user activity in those markets. Further, as of September 30, 2024, our ARPU was lower in international markets than in the United States. If we invest substantial time and resources to expand our international operations and are unable to do so successfully and in a timely manner, our business and financial condition may be harmed.
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Our revenue and gross profit are subject to seasonality and other potential fluctuations, and if our sales during the affected periods fall below our expectations, our business may be harmed.*
Seasonality and certain one-time events significantly affect our business. For example, our revenue and gross profit are traditionally strongest in the fourth quarter of each fiscal year due to higher consumer purchases and increased advertising during holiday seasons. Furthermore, in preparation for the fourth quarter holiday season, we recognize significant discounts in the average selling prices of our products through retailers in an effort to grow our Streaming Households, which typically reduce our devices gross margin in the fourth quarter. Additionally, certain other events have in the past, and may in the future, impact the amount of advertising spending on our platform. For example, we have experienced increased demand for advertising time and placement for political advertisements in connection with the U.S. presidential election.
Given the seasonal and often irregular nature of advertising and our product sales, as well as other potential fluctuations, accurate forecasting is critical to our operations. We anticipate that such impact on revenue and gross profit is likely to continue, and any shortfall in expected fourth quarter revenue due to a decline in the effectiveness of our promotional activities, actions by our competitors, reductions in consumer discretionary spending, curtailed advertising spending, disruptions in our supply or distribution chains, tariffs or other restrictions on trade, increased shipping costs, shipping or air freight delays, or for any other reason, would cause our full year results of operations to suffer significantly. For example, macroeconomic uncertainties and inflationary pressures negatively affected consumer electronics sales during the holiday season in 2023. In addition, delays or disruptions at U.S. ports of entry have in the past, and may in the future, adversely affect our or our licensed Roku TV partners’ ability to timely deliver products to retailers during holiday seasons.
A substantial portion of our expenses are personnel-related (including salaries, stock-based compensation, and benefits) and facilities-related, none of which are seasonal in nature. Accordingly, in the event of a revenue shortfall, we would be unable to mitigate the negative impact on gross profit and operating margins, at least in the short term, and our business would be harmed.
If we fail to attract and retain key personnel, effectively manage succession, or hire, develop, and motivate our employees, we may not be able to execute our business strategy or continue to grow our business.
Our success depends in large part on our ability to attract and retain key personnel on our senior management team and in our engineering, research and development, sales and marketing, operations, and other organizations. In particular, our founder, President and Chief Executive Officer, Anthony Wood, is critical to our overall management, as well as the continued development of our products and streaming platform, our culture, and our strategic direction. We do not have long-term employment or non-competition agreements with any of our key personnel. The loss of one or more of our executive officers or the inability to promptly identify a suitable successor to a key role could have an adverse effect on our business.
Our ability to compete and grow depends in large part on the efforts and talents of our employees. Labor is subject to external factors that are beyond our control, including our industry’s highly competitive market for skilled workers and leaders, cost inflation, workforce participation rates, and unstable political conditions. Our employees, particularly engineers and other product developers, are in demand, and we devote significant resources to identifying, hiring, training, successfully integrating, and retaining these employees. To attract top talent, we generally offer competitive compensation packages before we can validate the productivity of those employees. In addition, many companies now offer a remote or hybrid work environment, which may increase the competition for employees from employers outside of our traditional office locations. To retain employees, we have in the past and may in the future need to increase our employee compensation levels or other benefits in response to competition and other business and macroeconomic factors. The loss of employees or the inability to hire additional skilled employees necessary to support our growth could result in significant disruptions to our business, and the integration of replacement personnel could be time-consuming and expensive and cause disruptions.
We believe a critical component to our success and our ability to retain our best people is our culture. As we continue to grow, we may find it difficult to maintain our entrepreneurial, execution-focused culture. In addition, past or any additional workforce reductions could harm employee morale and negatively impact employee recruiting and retention.
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We need to maintain operational and financial systems that can support our expected growth, increasingly complex business arrangements, and rules governing revenue and expense recognition, and any inability or failure to do so could adversely affect our financial reporting, billing, and payment services.
We have a complex business that is growing in size and complexity both in the United States and in international jurisdictions. To manage our growth and our increasingly complex business operations, especially as we move into new markets internationally or acquire new businesses, we will need to maintain and may need to upgrade our operational and financial systems and procedures, which requires management time and may result in significant additional expense. Our business arrangements with our content partners, advertisers, licensed Roku TV partners, and other licensees, and the rules that govern revenue and expense recognition in our business, are increasingly complex.
To manage the expected growth of our operations and increasing complexity, we must maintain operational and financial systems, procedures, and controls and continue to increase systems automation to reduce reliance on manual operations. An inability to do so will negatively affect our financial reporting, billing, and payment services. Our current and planned systems, procedures, and controls may not be adequate to support our complex arrangements and the rules governing revenue and expense recognition for our future operations and expected growth. Delays or problems associated with any improvement or expansion of our operational and financial systems and controls could adversely affect our relationships with our users, content partners, advertisers, advertisement agencies, licensed Roku TV partners, or other licensees; cause harm to our reputation and brand; and result in errors in our financial and other reporting.
We may pursue acquisitions, which involve a number of risks, and if we are unable to address and resolve these risks successfully, such acquisitions could harm our business.
We have in the past and may in the future acquire businesses, products, or technologies to expand our offerings and capabilities, user base, and business. We have evaluated, and expect to continue to evaluate, a wide array of potential strategic transactions; however, we have limited experience completing or integrating acquisitions. Any acquisition could be material to our financial condition and results of operations, and any anticipated benefits from an acquisition may never materialize.
Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results, may cause unfavorable accounting treatment, may expose us to claims and disputes by third parties, including intellectual property claims, and may not generate sufficient financial returns to offset additional costs and expenses related to the acquisitions.
In addition, the process of integrating acquired businesses, products, or technologies may create unforeseen operating difficulties and expenditures, in particular when the acquired businesses, products, or technologies involve areas of operation in which we have limited or no prior experience.
Acquisitions of businesses, products, or technologies in international markets would involve additional risks, including those related to integration of operations across different cultures and languages, currency risks, and the particular economic, political, and regulatory risks associated with specific countries. We may not be able to address these risks successfully, or at all, without incurring significant costs, delays, or other operational problems, and if we were unable to address such risks successfully, our business could be harmed.

Our credit facility provides our lenders with a first-priority lien against substantially all of our assets and contains financial covenants and other restrictions on our actions that may limit our operational flexibility or otherwise adversely affect our financial condition.*
On September 16, 2024, we entered into a credit agreement (the “Credit Agreement”), by and among us, as borrower, certain of our subsidiaries, as guarantors, the lenders and issuing banks party thereto, and Citibank N.A., as administrative agent (the “Agent”), providing for (i) a five-year revolving credit facility in an aggregate principal amount of up to $300.0 million, and (ii) an uncommitted increase option of up to an additional $300.0 million exercisable upon the satisfaction of certain customary conditions. The Credit Agreement provides for a $100.0 million sub-facility for the issuance of letters of credit, and certain existing letters of credit were deemed outstanding under this facility. The Credit Agreement will mature on September 16, 2029. Proceeds from the Credit Agreement may be used for general corporate purposes, including to finance working capital requirements. As of September 30, 2024, we had not borrowed against the Credit Agreement.
The Credit Agreement contains financial covenants requiring the maintenance of a minimum interest coverage ratio and a maximum total net leverage ratio, as well as customary events of default, the occurrence of which could result in amounts borrowed under the Credit Agreement becoming due and payable and remaining commitments terminated prior to the initial termination date on September 16, 2029. The Credit Agreement also contains a number of customary affirmative and negative covenants that, among other things, impose restrictions, subject to certain exceptions, on indebtedness, liens, fundamental changes, investments, asset dispositions, restricted payments, dividends and distributions, prepayment of other indebtedness, transactions with affiliates, restrictive agreements, amendments of material documents, and the abandonment of intellectual property. The obligations under the Credit Agreement, along with certain swap and banking services obligations, are secured by substantially all the assets of us and our subsidiaries that are guarantors under the Credit Agreement, except for certain customary excluded assets.
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As of September 30, 2024, we were in compliance with all of the covenants of the Credit Agreement. However, if we fail to comply with the covenants, fail to make payments as specified in the Credit Agreement, or undergo any other event of default contained in the Credit Agreement, the Agent could declare an event of default, which would give it the right to terminate the commitments to provide additional loans and declare any borrowings outstanding, together with accrued and unpaid interest and fees, to be immediately due and payable. In addition, the Agent would have the right to proceed against the assets we provided as collateral pursuant to the Credit Agreement. If any future outstanding debt under the Credit Agreement is accelerated, we may not have sufficient cash or be able to sell sufficient assets to repay it, which would harm our business and financial condition.
We may require additional capital to meet our financial obligations and support planned business growth, and this capital might not be available on acceptable terms or at all.*
We intend to continue to make significant investments to support planned business growth and may require additional funds to respond to business challenges, including the need to develop new products and enhance our streaming platform, continue to expand the content on our platform, maintain adequate levels of inventory to support our retail partners’ demand requirements, improve our operating infrastructure, or acquire complementary businesses, personnel, and technologies. Our primary uses of cash include operating costs such as personnel-related expenses and capital spending. Our future capital requirements may vary materially from those currently planned and will depend on many factors including our growth rate and the continuing market acceptance of our products and streaming platform, along with the timing and effort related to the introduction of new platform features, products, the hiring of experienced personnel, the expansion of sales and marketing activities, as well as overall economic conditions.
We may need to engage in equity or debt financings to secure additional funds. If we raise additional funds through future issuances of equity or convertible debt securities, our then existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our Class A common stock. Any debt financing we secure could involve additional restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. If we were to violate such restrictive covenants, we could incur penalties, increased expenses, and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business.
Our Credit Agreement matures on September 16, 2029. While we may enter into a new credit agreement in the future, we currently have no other committed source of financing, and we may not be able to obtain additional financing on terms favorable to us. Any future credit agreements we may enter into could require a lien on our assets or contain financial covenants and other restrictions that may limit our operational flexibility or otherwise adversely affect our financial condition. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be significantly impaired, and our business may be harmed.
We maintain cash deposits in excess of federally insured limits. Adverse developments affecting financial institutions, including bank failures, could adversely affect our liquidity and financial performance.
We maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks that exceed the FDIC insurance limits. We also maintain cash deposits in foreign banks where we operate, some of which are not insured or are only partially insured by the FDIC or similar agencies. Bank failures, events involving limited liquidity, defaults, non-performance, or other adverse developments that affect financial institutions, or concerns or rumors about such events, may lead to liquidity constraints. For example, in 2023, Silicon Valley Bank failed and was taken into receivership by the FDIC. The failure of a bank, or other adverse conditions in the financial or credit markets impacting financial institutions at which we maintain balances, could adversely impact our liquidity and financial performance. There can be no assurance that our deposits in excess of the FDIC or other comparable insurance limits will be backstopped by the U.S. or applicable foreign government, or that any bank or financial institution with which we do business will be able to obtain needed liquidity from other banks, government institutions, or by acquisition in the event of a failure or liquidity crisis.
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Risks Related to Cybersecurity, Reliability, and Data Privacy
Data security incidents, including cybersecurity attacks, or other significant disruptions of our information technology systems could harm our reputation, cause us to modify our business practices, and otherwise adversely affect our business and subject us to liability.*
We are dependent on information technology systems and infrastructure to operate our business. In the ordinary course of our business, we collect, store, process, and transmit large amounts of sensitive corporate, personal, and other information, including intellectual property, proprietary business information, user payment card information, user video and audio recordings, other user information, employee information, and other confidential information. It is critical that we do so in a secure manner to maintain the confidentiality, integrity, and availability of such information. Our obligations under applicable laws, regulations, contracts, industry standards, self-certifications, and other documentation may include maintaining the confidentiality, integrity, and availability of personal information in our possession or control, maintaining reasonable and appropriate security safeguards as part of an information security program, and complying with requirements regarding the use or cross-border transfer of such personal information. These obligations create potential legal liability to regulators, our business partners, our users, and other relevant stakeholders and impact the attractiveness of our services to existing and potential users.
We have outsourced certain elements of our operations (including elements of our information technology infrastructure) to third parties, or may have incorporated technology into our platform, that collects, processes, transmits, and stores our users’ or others’ personal information (such as payment card information and user video and audio recordings), and as a result, we manage a number of third-party vendors and other partners who may or could have access to our information technology systems (including our computer networks) or to our confidential information. In addition, many of those third parties in turn subcontract or outsource some of their responsibilities to third parties. As a result, our information technology systems, including the functions of third parties that are involved in or have access to those systems, are very large and complex.
While all information technology operations are inherently vulnerable to inadvertent or intentional security breaches, incidents, attacks, and exposures, the size, complexity, accessibility, and distributed nature of our information technology systems, and the large amounts of sensitive or personal information stored on those systems, make such systems vulnerable to unintentional or malicious, internal, and external threats on our technology environment. Vulnerabilities can be, and have been, exploited from inadvertent or intentional actions of our employees, third-party vendors, business partners, or by malicious third parties. Open-source software, which may be incorporated into our systems or products, inherently presents a large attack surface and may contain vulnerabilities of which we are not aware and which we cannot control or fully mitigate. Additionally, credential stuffing attacks are becoming increasingly common, and sophisticated actors can mask their attacks, making them increasingly difficult to identify and prevent. Moreover, AI technologies may be used to implement certain cybersecurity attacks or to increase their intensity, which may further increase risk. While we have processes in place to mitigate the risks related to these vulnerabilities, these measures may not be adequately designed or implemented to ensure that our operations are not disrupted, our reputation is not harmed, or that we will not be impacted by ransomware, cybersecurity attacks, or other vulnerabilities in the future.
There is no way of knowing with certainty whether we have experienced any data security incidents that have not been discovered. While we have no reason to believe that we have experienced a data security incident that we have not discovered, attackers have become very sophisticated in the way they conceal their unauthorized access to systems, and many companies that have been attacked are not aware that they have been attacked. Any event (including credential stuffing) that leads to unauthorized access, use, or disclosure of personal information, including but not limited to personal information regarding our users, could disrupt our business, harm our reputation, compel us to comply with applicable federal or state breach notification laws and foreign law equivalents, subject us to time-consuming, distracting, and expensive litigation, regulatory inquiries, investigations and oversight, mandatory corrective action, require us to verify the correctness of database contents, or otherwise subject us to liability under laws, regulations, and contractual obligations, including those that protect the privacy and security of personal information. This could result in increased costs to us and result in significant legal and financial exposure or reputational harm.
For example, despite our efforts to secure our information technology systems and the data contained in those systems, we and our third-party vendors and business partners have experienced, and remain vulnerable to, data security incidents, including ransomware, phishing attacks, bot attacks, credential stuffing attacks, improper employee access of confidential data, and inadvertent employee disclosure of confidential data. Our systems regularly experience directed attacks that are intended to interrupt our operations; interrupt our users’, content partners’, and advertisers’ ability to access our platform; extract money from us; or view or obtain our data (including without limitation user or employee personal information or proprietary information) or intellectual property. Our systems have been and may continue to be attacked through the use of compromised credentials, including those obtained through phishing or stolen from another source unrelated to us.
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Malicious attacks are increasing in their frequency, levels of persistence, sophistication, and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives (including, but not limited to, industrial espionage) and expertise, including organized criminal groups, “hacktivists,” nation states, and others. The geopolitical conflicts stemming from the Russian invasion of Ukraine and the current unrest in the Middle East have increased the risk of malicious attacks on information technology operations globally, including for companies headquartered in the United States, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell, and distribute our devices and services.
Most of our employees now have a hybrid work schedule (consisting of both in-person work and working from home). Although we have implemented work from home protocols, the actions of our employees while working from home may have a greater effect on the security of our systems and the data we process, including by increasing the risk of compromise to our systems, intellectual property, or data arising from employees’ combined use of personal and private devices, accessing our systems or data using wireless networks that we do not control, or the ability to transmit or store company-controlled data outside of our secured network.
In addition, information technology system disruptions, whether from attacks on our technology environment or from computer viruses, natural disasters, terrorism, war, foreign invasions, and telecommunications and electrical failures, could result in a material disruption of our product development and our business operations. Significant disruptions of our third-party vendors’ or commercial partners’ information technology systems or other similar data security incidents could also adversely affect our business operations or result in the loss, misappropriation, or unauthorized access, use or disclosure of, or the prevention of access to, sensitive or personal information, which could harm our business.
Though it is difficult to determine what harm may directly result from any specific interruption or breach, any failure to maintain performance, reliability, security, and availability of our network infrastructure to the satisfaction of our users, business partners, regulators, or other relevant stakeholders may harm our reputation and our ability to retain existing users and attract new users. Because of our prominence in the TV streaming industry, we believe we may be a particularly attractive target for threat actors. Any attempts by threat actors to disrupt our streaming platform, streaming devices, smart home products, website, computer systems, or mobile apps, if successful, could harm our business, subject us to liability, be expensive to remedy, cause harm to our systems and operations, damage our reputation, and could result in contractual damages, litigation, governmental inquiries and investigations, enforcement actions, and regulatory notification requirements, fines, and penalties that could harm our business. The risk of harm to our business caused by security incidents may also increase as we expand our product and service offerings and as we enter new markets. Efforts to prevent threat actors from entering our computer systems or exploiting vulnerabilities in our products are expensive to implement and may not be effective in detecting or preventing intrusion or vulnerabilities.
For example, in the wake of a data breach involving payment card data, we may be subject to substantial penalties for failure to adhere to the technical or operational security requirements of the Payment Card Industry (“PCI”) Data Security Standards (“DSS”) imposed by the PCI Council to protect cardholder data. Penalties arising from PCI DSS enforcement are inherently uncertain as penalties may be imposed by various entities within the payment card processing chain without regard to any statutory or universally mandated framework. Such enforcement could threaten our relationship with our banks, card brands we do business with, and our third-party payment processors.
There can be no assurance that the limitations of liability in our contracts would be enforceable or adequate or would otherwise protect us from liabilities or damages. While we maintain insurance policies to cover certain losses relating to our information technology systems, there may be exceptions. Security incidents may not be fully covered by our insurance policies, and some aspects of a security incident may not be covered at all. Additionally, insurance policies will not protect against the reputational harms caused by a major security incident. Even where an incident is covered by our insurance, the insurance limits may not cover the costs of complete remediation and redress that we may be faced with in the wake of a security incident.
The successful assertion of one or more large claims against us that exceeds our available insurance coverage, or results in changes to our insurance policies (including premium increases or the imposition of large deductible or co-insurance requirements), could have an adverse effect on our business. In addition, we cannot be sure that our existing insurance coverage and coverage for errors and omissions will continue to be available on acceptable terms or that our insurers will not deny coverage as to any future claim.
Data protection laws around the world often require “reasonable,” “appropriate,” or “adequate” technical and organizational security measures, and the interpretation and application of those laws are often uncertain and evolving, and there can be no assurance that our security measures will be deemed adequate, appropriate, or reasonable by a regulator or court. Moreover, even security measures that are deemed appropriate, reasonable, or in accordance with applicable legal requirements may not be able to protect the information we maintain. In addition to potential fines, we could be subject to mandatory corrective action due to a data security incident, which could adversely affect our business operations and result in substantial costs and reputational harm.
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We and our service providers and partners collect, process, transmit, and store personal and confidential information, which creates legal obligations and exposes us to potential liability.*
We collect, process, transmit, and store personal or confidential information about our users (and their devices), other consumers, employees, job applicants, and partners, and we rely on third-party service providers to collect, process, transmit, and store personal or confidential information (including our users’ payment card data and video and audio recordings). We collect such information from individuals located both in the United States and abroad and may store or process such information outside the country in which it was collected. Further, we, our service providers and our business partners use tracking technologies, including cookies, device identifiers, and related technologies, to help us manage and track our users’ interactions with our platform, devices, website, and partners’ content and deliver relevant advertising and personalized content for ourselves and on behalf of our partners on our products.
We collect information about the interaction of users with our platform, devices, website, advertisements, and content partners’ streaming apps. To deliver relevant advertisements effectively, we must successfully leverage this data, as well as data provided by third parties. Our ability to collect and use such data could be restricted by a number of factors, including users having the ability to refuse consent to or opt out from our, our service providers’, or our advertising partners’ collection and use of this data, restrictions imposed by advertisers, content partners, licensors, and service providers, changes in technology, and developments in laws, regulations, and industry standards. For example, certain European Union (“EU”) laws and regulations prohibit access to or storage of information on a user’s device (such as cookies and similar technologies that we use for advertising) that is not “strictly necessary” to provide a user-requested service or used for the “sole purpose” of a transmission unless the user has provided consent, and users may choose not to provide this consent to collection of information which is used for advertising purposes.
Additionally, certain device manufacturers or operating system providers may restrict the deployment of cookies and similar technologies, or otherwise restrict the collection of personal information through these or other tools, via our applications. Any restrictions on our ability to collect or use data, including instances where our users refuse to consent to the collection or use of their data, could harm our ability to grow our revenue, particularly our platform revenue which depends on engaging the relevant recipients of advertising campaigns.
Various federal, state, and foreign laws and regulations as well as industry standards and contractual obligations govern the collection, use, processing, retention, deletion, protection, disclosure, cross-border transfer, localization, sharing, and security of the data we receive from and about our users, employees, and other individuals. The regulatory requirements and consumer expectations related to the collection, use, processing, retention, and deletion of personal information by device manufacturers, online service providers, content distributors, advertisers, and publishers is evolving in the United States and internationally.
Privacy and consumer rights groups and government bodies (including the U.S. Federal Trade Commission (“FTC”), state attorneys general, the European Commission, European and UK data protection authorities, and the Brazilian national data protection authority), have increasingly scrutinized privacy issues with respect to devices that identify or are identifiable to a person (or household or device) and personal information collected through the internet, and we expect such scrutiny to continue to increase.
The U.S. federal government, U.S. states, and foreign governments have enacted (or are considering) laws and regulations that could significantly restrict industry participants’ ability to collect, use, and share personal information, such as by regulating the level of consumer notice and consent required before a company can place cookies or other tracking technologies or collect categories of personal information deemed sensitive. For example, the EU General Data Protection Regulation (“GDPR”) imposes detailed requirements related to the collection, storage, and use of personal information related to people located in the EU (or which is processed in the context of EU operations) and places data protection obligations and restrictions on organizations, including requiring a company to delete collected data, and may require us to make further changes to our policies and procedures in the future beyond what we have already done. In addition, in the wake of the United Kingdom’s withdrawal from the EU (“Brexit”), the United Kingdom has adopted a framework similar to the GDPR. The EU has confirmed that the UK data protection framework is “adequate” to receive EU personal data.
Data protection laws and regulations continue to proliferate throughout the world. We continue to monitor the implementation and evolution of such laws and regulations, but if we are not compliant with data protection laws or regulations if and when implemented, we may be subject to significant fines and penalties (such as restrictions on personal information processing) and our business may be harmed. For example, under the GDPR, fines of up to 20 million euros or 4% of the annual global revenue of a noncompliant company, whichever is higher, as well as data processing restrictions, could be imposed for violation of certain of the GDPR’s requirements.
The U.S. data protection legal landscape also continues to evolve, with various states having enacted broad-based data privacy and protection legislation and with states and the federal government continuing to consider additional data privacy and protection legislation. The potential effects of this legislation are far-reaching and may require us to modify our data processing practices and policies and incur substantial costs and expenses in an effort to comply. For example, the California Consumer Privacy Act (“CCPA”) provides for civil penalties for violations, as well as a private right of action
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for certain data breaches that may increase data breach litigation. The California Privacy Rights Act (“CPRA”), which amended the CCPA, among other things, established a dedicated agency to regulate and enforce the CCPA.
Furthermore, rules governing new technological developments, such as developments in generative AI, remain unsettled. Several national and local governments have proposed or enacted measures related to the use of AI technologies in products and services. For example, in the EU, legislators adopted the EU AI Act in May 2024. The EU AI Act imposes new and substantial obligations related to the use of AI-related systems. In the United States, there similarly is growing interest among federal, state, and local policymakers with respect to potential legislation, regulation, and/or guidance to address perceived concerns with the rapid uptake of AI technologies. During the 2024 legislative session, multiple U.S. states adopted laws concerning AI. The rules and regulations adopted by policymakers over time may require us to make changes to our business practices.
We are continuing to assess the impact of new and proposed data privacy and protection laws and proposed amendments to existing laws on our business. Among other things, such restrictions are likely to increase the number of users to whom we cannot serve targeted advertising, and are likely to restrict our ability to collect and process certain types of information deemed sensitive under these new laws. The Canadian province of Quebec has also enacted a data protection law, known as Bill 64, that may similarly impose requirements on our data processing activities.
In addition, each U.S. state and most U.S. territories, each EU member state, and the United Kingdom, as well as many other foreign nations, have passed laws requiring notification to regulatory authorities, affected users, or others within a specific timeframe when there has been a security breach involving, or other unauthorized access to or acquisition or disclosure of, certain personal information and impose additional obligations on companies. Additionally, our agreements with certain users or partners may require us to notify them in the event of a security breach. Such statutory and contractual disclosures are costly, could lead to negative publicity, may cause our users to lose confidence in the effectiveness of our security measures, and may require us to expend significant capital and other resources to respond to or alleviate problems caused by the actual or perceived security breach. Compliance with these obligations could delay or impede the development of new products and may cause reputational harm.
As part of our data protection compliance program, we have implemented data transfer mechanisms to provide for the transfer of personal information from the European Economic Area (the “EEA”) or the United Kingdom to the United States. After a period of uncertainty concerning certain mechanisms for data transfers to the United States, in July 2023, the European Commission adopted an adequacy decision concerning a new framework for data transfers from the EEA to the United States, known as the EU-U.S. Data Privacy Framework (“EU-U.S. DPF”). That decision recognizes that the United States ensures an adequate level of protection for personal information transferred from the EEA to organizations participating in the EU-U.S. DPF. The United Kingdom has made a similar determination, providing a means by which data transfers may take place between the United States and the United Kingdom. That framework, known as the UK Extension to the EU-U.S. DPF, became effective in October 2023. We have since joined the EU, Swiss, and UK DPF programs to facilitate any transfers of non-HR personal data to the United States from these jurisdictions.
In addition, cloud service providers upon which our services depend are experiencing heightened scrutiny from EU regulators, which may lead to significant shifts or unavailability of cloud services to transfer personal information outside the EU, which may significantly impact our costs or ability to operate.
We continue to assess the available regulatory guidance, determinations, and enforcement actions from EU Data Protection Authorities and the U.S. Department of Commerce on international data transfer compliance for companies. Our ability to continue to transfer personal information outside of the EU may become significantly more costly and may subject us to increased scrutiny and liability under the GDPR or other legal frameworks, and we may experience operating disruptions if we are unable to conduct these transfers in the future.
We will continue to review our business practices and may find it necessary or desirable to make changes to our personal information processing to cause our transfer and receipt of EEA residents’ personal information to conform to applicable European law. The regulation of data privacy in the EU continues to evolve, and it is not possible to predict the ultimate effect of evolving data protection regulation and implementation over time. Member states also have some flexibility to supplement the GDPR with their own laws and regulations and may apply stricter requirements for certain data processing activities.
In addition, some countries are considering or have enacted “data localization” laws requiring that user data regarding users in their respective countries be maintained, stored, or processed in their respective countries. Maintaining local data centers in individual countries could increase our operating costs significantly. We expect that, in addition to the “business as usual” costs of compliance, the evolving regulatory interpretation and enforcement of laws such as the GDPR and CCPA, as well as other domestic and foreign data protection laws, will lead to increased operational and compliance costs and will require us to continually monitor and, where necessary, make changes to our operations, policies, and procedures. Any failure or perceived failure to comply with privacy-related legal obligations, or any compromise of security of user data, may result in governmental enforcement actions, litigation, contractual indemnities, or public statements against us by consumer advocacy groups or others. In addition to potential liability, these events could harm our business.
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We publish privacy policies, notices, and other documentation regarding our collection, processing, use, and disclosure of personal information, credit card information, and other confidential information. Although we endeavor to comply with our published policies, certifications, and documentation, we may at times fail to do so or may be perceived to have failed to do so. Moreover, despite our efforts, we may not be successful in achieving compliance if our employees, representatives, agents, vendors, or other third parties fail to comply with our published policies, certifications, and documentation. Such failures could subject us to potential international, local, state, and federal action, substantial monetary fines, and other penalties if they are found to be deceptive, unfair, or misrepresentative of our actual practices, which could harm our business, financial condition, and results of operations.
We have incurred, and will continue to incur, expenses to comply with privacy and security standards and protocols imposed by law, regulation, industry standards, and contractual obligations. Increased regulation of data collection, use, and security practices, including self-regulation and industry standards, changes in existing laws, enactment of new laws, increased enforcement activity, and changes in interpretation of laws, could increase our cost of compliance and operation, limit our ability to grow our business, or otherwise harm our business.
Any significant disruption in our information technology systems or those of third parties we utilize in our operations could result in a loss or degradation of service on our platform and could harm our business.*
We rely on the expertise of our engineering and software development teams as well as the teams of our service providers and partners for the performance and operation of the Roku OS, streaming platform, smart home products, and other information technology systems. Service interruptions, errors in our software, or the unavailability of information technology systems used in our operations could diminish the overall attractiveness of our products and streaming platform to existing and potential users or otherwise disrupt our business. We utilize information technology systems located either in our facilities or those of third-party server hosting providers and third-party internet-based or cloud computing services. Although we generally enter into service level agreements with these parties, we exercise no control over their operations, which makes us vulnerable to any errors, interruptions, or delays that they may experience.
We have transitioned, and may continue to transition, features of our services from our managed hosting systems to cloud computing services, which may require significant expenditures and engineering resources. If we are unable to manage such a transition effectively, we may experience a loss or degradation in services, operational delays, or inefficiencies until the transition is complete. Upon the expiration or termination of any of our agreements with third-party vendors, we may not be able to replace their services in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete. In addition, fires, floods, earthquakes, wars, foreign invasions, terrorist activity, power losses, telecommunications failures, break-ins, and similar events could damage these systems and hardware or cause them to fail completely.
As we do not maintain entirely redundant systems, a disrupting event could result in prolonged downtime of our operations, products, or services, could result in liabilities to our customers or third parties, and could adversely affect our business. Our property insurance and cyber liability insurance may not be sufficient to fully cover our losses or may not cover a particular event at all. Any disruption in the services provided by these vendors could have adverse impacts on our business reputation, customer relations, and operating results.
If any aspect of our information technology systems or those of third parties we utilize in our operations fails, it may lead to downtime or slow processing time, either of which may harm the experience of our users. We have experienced, and may in the future experience, service disruptions, outages, and other performance problems due to a variety of factors, including infrastructure changes, human or software errors, and capacity constraints. We expect to continue to invest in our technology infrastructure to maintain and improve the user experience and platform performance. To the extent that we or our third-party service hosting providers do not effectively address capacity constraints, upgrade or patch systems as needed, and continually develop technology and network architecture to accommodate increasingly complex services and functions, increasing numbers of users, and actual and anticipated changes in technology, our business may be harmed.
Changes in how network operators manage data that travel across their networks could harm our business.
Our business relies upon the ability of our users to access high-quality streaming content through the internet. As a result, the growth of our business depends on our users’ ability to obtain and maintain high-speed access to the internet at reasonable cost, which relies in part on internet service network operators’ continuing willingness to upgrade and maintain their equipment as needed to sustain a robust internet infrastructure as well as their continued willingness to preserve the open and interconnected nature of the internet. We exercise no control over network operators, which makes us vulnerable to any errors, disruptions, or delays in their operations, as well as any decision they may make to prioritize the delivery of certain network traffic at the expense of other traffic. Any material disruption or degradation in internet services could harm our business.
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To the extent that the number of internet users continues to increase, network congestion could adversely affect the reliability of our streaming platform. We may also face increased costs of doing business, or decreased demand for our services, if network operators engage in discriminatory practices with respect to streamed video content in an effort to monetize access to their networks or customers by data providers.
Certain laws intended to prevent network operators from engaging in discriminatory practices with respect to streaming video content have been implemented in many countries, including in the EU. In other countries, laws in this area may be nascent or non-existent. Furthermore, favorable laws may change. Given the uncertainty around these laws and the rules that implement them, including changing interpretations, amendments, or repeal, coupled with potentially significant political and economic power of network operators, we could experience discriminatory or anti-competitive practices, such as usage-based pricing, bandwidth caps, zero rating of competing services by ISPs, and traffic “shaping” or throttling, that could impede our growth, result in a decline in our quality of service, cause us to incur additional expense, or otherwise impair our ability to attract and retain users, all of which could harm our business.
In addition, most network operators that provide users with access to the internet also offer users multichannel video programming, and some network operators also own streaming services. These network operators have an incentive to use their network infrastructure in a manner adverse to the continued growth and success of other companies seeking to distribute similar video programming. To the extent that network operators are able to provide preferential treatment to their own data and content, as opposed to ours, our business could be harmed.
Risks Related to Intellectual Property
Litigation and claims regarding intellectual property rights could result in the loss of rights important to our products and streaming platform, cause us to incur significant legal costs, or otherwise harm our business.
Some internet, technology, and media companies, including some of our competitors, own large numbers of patents, copyrights, and trademarks, which they may use to assert claims against us. Third parties have asserted, and may in the future assert, that we have infringed, misappropriated, or otherwise violated their intellectual property rights. As we grow and face increasing competition, the possibility of intellectual property rights claims against us will grow. Plaintiffs who have no relevant product revenue may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us and may seek to challenge the validity or enforceability of our own patents and patents applications. The cost of patent litigation or other proceedings, even if resolved in our favor, has been and is expected to be substantial. Some of our competitors may be better able to sustain the costs of such litigation or proceedings because of their substantially greater financial resources. Patent litigation and other proceedings may also require significant management time and divert management’s attention from our other business concerns or otherwise adversely affect our business and operating results. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could impair our ability to compete in the marketplace. The occurrence of any of the foregoing could harm our business.
As a result of intellectual property infringement claims, or to avoid potential claims, we may choose or be required to seek licenses from third parties. These licenses may not be available on commercially reasonable terms, or at all, thereby hindering our ability to sell or use the relevant technology or requiring redesign of the allegedly infringing solutions to avoid infringement, which could be costly, time‐consuming, or impossible. Even if we are able to obtain a license, the license would likely obligate us to pay license fees or royalties or both, and the rights granted to us might be nonexclusive, with the potential for our competitors to gain access to the same intellectual property. In addition, the rights that we secure under intellectual property licenses may not include rights to all of the intellectual property owned or controlled by the licensor, and the scope of the licenses granted to us may not include rights covering all of the products and services provided by us and our licensees. Furthermore, an adverse outcome of a dispute may require us to: pay damages, potentially including treble damages and attorneys’ fees, if we are found to have willfully infringed a party’s intellectual property; cease making, licensing, or using technologies that are alleged to infringe or misappropriate the intellectual property of others; expend additional development resources to redesign our products; enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content, or materials; and indemnify our partners and other third parties. For example, we have in the past elected to develop and implement specific design changes to address potential risks that certain products could otherwise become subject to exclusion or cease and desist orders arising from patent infringement and other intellectual property claims brought in the U.S. International Trade Commission. In addition, any lawsuits regarding intellectual property rights, regardless of their success, could be expensive to resolve and would divert the time and attention of our management and technical personnel.
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If we fail to, or are unable to, protect or enforce our intellectual property or proprietary rights, our business and operating results could be harmed.
We regard the protection of our patents, trade secrets, copyrights, trademarks, trade dress, domain names, and other intellectual property or proprietary rights as critical to our success. We strive to protect our intellectual property rights by relying on federal, state, and common law rights, as well as contractual restrictions. We seek to protect our confidential proprietary information, in part, by entering into confidentiality agreements and invention assignment agreements with all of our employees, consultants, contractors, advisors, and any third parties who have access to our proprietary know-how, information, or technology.
However, we cannot be certain that we have executed such agreements with all parties who may have helped to develop our intellectual property or who had access to our proprietary information, nor can we be certain that our agreements will not be breached. Any party with whom we have executed such an agreement could potentially breach that agreement and disclose our proprietary information, including our trade secrets, and we may not be able to discover such breaches, and if we do, we may not be able to obtain adequate remedies for such breaches. We cannot guarantee that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. Detecting the disclosure or misappropriation of a trade secret and enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, time-consuming, and could result in substantial costs, and the outcome of such a claim is unpredictable.
Further, the laws of certain foreign countries do not provide the same level of protection of corporate proprietary information and assets such as intellectual property, trademarks, trade secrets, know-how, and records as the laws of the United States. For instance, the legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection. As a result, we may encounter significant problems in protecting and defending our intellectual property or proprietary rights abroad. Additionally, we may also be exposed to material risks of theft or unauthorized reverse engineering of our proprietary information and other intellectual property, including technical data, manufacturing processes, data sets, or other sensitive information.
Our efforts to enforce our intellectual property rights in such foreign countries may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop, which could have a material adverse effect on our business, financial condition, and results of operations. Moreover, if we are unable to prevent the disclosure of our trade secrets to third parties, or if our competitors independently develop any of our trade secrets, we may not be able to establish or maintain a competitive advantage in our market, which could harm our business.
There can be no assurance that the particular forms of intellectual property protection that we seek, including business decisions about when to file patents and when to maintain trade secrets, will be adequate to protect our business. We have filed and will in the future file patent applications on inventions that we deem to be innovative. There is no guarantee that our patent applications will issue as granted patents, that the scope of the protection gained will be sufficient or that an issued patent may subsequently be deemed invalid or unenforceable. U.S. patent laws, and the scope of coverage afforded by them, have been subject to significant changes, such as the change to “first-to-file” from “first-to-invent” resulting from the Leahy-Smith America Invents Act. This change in the determination of inventorship may result in inventors and companies having to file patent applications more frequently to preserve rights in their inventions, which may favor larger competitors that have the resources to file more patent applications. Another change to the patent laws may incentivize third parties to challenge any issued patent in the United States Patent and Trademark Office (“USPTO”), as opposed to having to bring such an action in U.S. federal court. Foreign patent laws may also continue to develop and significantly impact our ability to protect or maintain our intellectual property. Any invalidation of a patent claim could have a significant impact on our ability to protect the innovations contained within our products and platform and could harm our business.
The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment, and other provisions to maintain patent applications and issued patents. We may fail to take the necessary actions and pay the applicable fees to obtain or maintain our patents. Noncompliance with these requirements can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, competitors might be able to use our technologies and enter the market earlier than would otherwise have been the case.
We pursue the registration of our domain names, trademarks, and service marks in the United States and in certain locations outside the United States. We are seeking to protect our trademarks, patents, and domain names in an increasing number of jurisdictions, a process that is expensive and time-consuming and may not be successful or which we may not pursue in every jurisdiction in which we conduct business. Despite the cost and time we spend monitoring, we may or may not be able to detect infringement by third parties. Our competitive position may be harmed if we cannot detect infringement and enforce our intellectual property rights quickly or at all. In particular, our actions to monitor and enforce our trademarks against third parties may not prevent counterfeit versions of our products or products bearing confusingly similar trademarks to ours from entering the marketplace, which could divert sales from us, tarnish our reputation, or reduce the demand for our products. In some circumstances, we may choose to not pursue enforcement because an infringer has a dominant intellectual property position or for other business reasons.
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Litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets, or determine the validity and scope of proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in substantial costs, adverse publicity, or diversion of management and technical resources, any of which could adversely affect our business and operating results. If we fail to maintain, protect, and enhance our intellectual property or proprietary rights, our business may be harmed.
Our use of open-source software could impose limitations on our ability to commercialize our products and our streaming platform or could result in public disclosure of competitively sensitive trade secrets.
We incorporate open-source software in our proprietary software. From time to time, companies that have incorporated open-source software into their products and services have faced claims challenging the ownership of certain open-source software or compliance with open-source software license terms. Therefore, we could be subject to similar suits by parties claiming ownership of what we believe to be open-source software or our noncompliance with the open-source software license terms.
Although we have processes and procedures designed to help monitor our use of open-source software, these processes and procedures may not be followed appropriately or may fail to identify risks. Additionally, the terms of many open-source software licenses have not been interpreted by U.S. courts, and there is a risk that such licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our products or technology or impose unanticipated obligations that could require the disclosure of trade secrets. Some open‐source software is governed by licenses containing conditions that any person who distributes or uses a modification or derivative work of software that was subject to an open‐source license make the modified version subject to the same open‐source license. Distributing or using software that is subject to this kind of open‐source license can lead to a requirement that certain aspects of our solutions be distributed or made available in source code form. In such event, we could be required to make portions of our proprietary software generally available under similar open-source software license terms to third parties, including competitors, at low or no cost, to seek licenses from third parties in order to continue offering our products, to re-engineer our products, or to discontinue the sale of our products in the event re-engineering cannot be accomplished on a timely basis or at all, any of which could harm our business.
Further, use of open‐source software can involve greater risks than those associated with use of third‐party commercial software, as open‐source licensors generally do not provide warranties, assurances of title, performance, non‐infringement, or controls on the origin of the software. Open‐source software typically lacks support, and authors of such open‐source software may abandon further development and maintenance. Open‐source software may contain security vulnerabilities and other liabilities, and we may be subject to additional security risk by using open‐source software. We have established processes to help alleviate these risks, but there can be no assurance that these processes will alleviate all risks with the open‐source software we incorporate.
Under our agreements with many of our content partners, licensees, distributors, retailers, contract manufacturers, and suppliers, we are required to provide indemnification in the event our technology is alleged to infringe upon the intellectual property rights of third parties.
In certain of our agreements, we indemnify our content partners, licensees, distributors, retailers, manufacturing partners, and suppliers. We have in the past, and may in the future, incur significant expenses defending these partners if they are sued for patent or other property infringement based on allegations related to our technology. If a partner were to lose a lawsuit and in turn seek indemnification from us, we also could be subject to significant monetary liabilities. In addition, because the devices sold by our licensing partners and licensed Roku TV partners often involve the use of third-party technology, this increases our exposure to litigation in circumstances where there is a claim of infringement asserted against the streaming device in question, even if the claim does not pertain to our technology. Liability under our indemnification commitments may not be contractually limited.
Risks Related to Macroeconomic Conditions
Macroeconomic uncertainties have in the past and may continue to adversely impact our business, results of operations, and financial condition.*
Macroeconomic uncertainties, including increased inflation and interest rates, slow growth or recession, higher interest rates, financial and credit market fluctuations, changes in economic policy, bank failures, labor disputes, and global supply chain constraints have in the past, and may continue to, adversely impact consumer confidence and spending and materially adversely affect many aspects of our business.
Our business is dependent on consumer discretionary spending and advertising spending, both of which are susceptible to changes in macroeconomic conditions. Sustained or worsening inflation or an economic downturn has in the past and may in the future result in fewer consumer purchases of our products or the products of our licensed Roku TV partners and reduced advertising spending. Advertising budgets in a variety of industries have been pressured by factors such as inflation, rising interest rates, and related market uncertainty, which led to reduced advertiser spending and adversely affected our platform revenue. Further, even if the broader advertising market recovers, advertisers may
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not choose to advertise on our platform. Any pullback in consumer discretionary spending or advertising spending could adversely affect our future operating results.
In addition, a significant reduction in the supply of original entertainment content, including as a result of macroeconomic factors or labor disputes (such as the 2023 strikes called by the Writers Guild of America and SAG‐AFTRA), could in turn reduce the demand for advertising and media and entertainment promotional spending campaigns on our platform, and have a material adverse effect on our financial condition, operating results, and key performance metrics.
The extent to which macroeconomic uncertainties may continue to impact our operational and financial performance remains uncertain and will depend on many factors outside our control. These direct and indirect impacts may negatively affect our business and operating results.
Natural disasters, geopolitical conflicts, or other natural or man-made catastrophic events could disrupt and impact our business.*
Occurrence of any catastrophic event, including an earthquake, flood, tsunami, or other weather event, power loss, internet failure, software or hardware malfunctions, cybersecurity attack, war or foreign invasion (such as the Russian invasion of Ukraine and the unrest in the Middle East), terrorist attack and other geopolitical conflicts (such as Yemen’s Houthi attacks in the Red Sea), medical epidemic or pandemic (such as the COVID-19 pandemic), government shutdown orders, other man-made disasters, or other catastrophic events could disrupt our, our business partners’ and customers’ business operations or result in disruptions in the broader global economic environment. Any of these business disruptions could require substantial expenditures and recovery time in order to fully resume operations.
In particular, our principal offices are located in California, and our contract manufacturers and some of our suppliers are located in Asia, both of which are regions known for seismic activity, making our operations in these areas vulnerable to natural disasters or other business disruptions in these areas. Our insurance coverage may not compensate us for losses that may occur in the event of an earthquake or other significant natural disaster. For example, a recent earthquake damaged equipment in our Taiwan office, and the losses, while relatively minor, were not covered by our insurance.
In addition, our offices and facilities, and those of our contract manufacturers, suppliers, and licensed Roku TV partners, could be vulnerable to the effects of climate change (such as sea level rise, drought, flooding, wildfires, and increased storm severity) that could disrupt our business operations. For example, in California, increasing intensity of drought and annual periods of wildfire danger increase the probability of planned power outages. Further, acts of terrorism could cause disruptions to the internet or the economy as a whole.
If our streaming platform was to fail or be negatively impacted as a result of a natural disaster or other event, our ability to deliver streaming content, including advertising, to our users would be impaired. Disruptions in the operations of our contract manufacturers, suppliers, or licensed Roku TV partners as a result of a disaster or other catastrophic event could delay the manufacture and shipment of our products or the products of our licensed Roku TV partners, which could impact our business. If we are unable to develop adequate plans to ensure that our business functions continue to operate during and after a natural disaster or other catastrophic event and to execute successfully on those plans in the event of a disaster or catastrophic event, our business would be harmed.
Legal and Regulatory Risks
We have been, are currently, and may in the future be subject to various lawsuits and other legal proceedings, disputes, claims, and government inquiries and investigations, which could cause us to incur substantial costs or require us to change our business practices in a way that could seriously harm our business.*
We have been, are currently, and may in the future be subject to various lawsuits, stockholder derivative actions, class action lawsuits, individual or mass arbitration proceedings, and other types of legal proceedings, as well as other disputes, claims, and regulatory or governmental inquiries and investigations, including with regard to contract or commercial disputes, consumer protection, privacy, data protection, intellectual property, tax, employment, and corporate governance, among other matters. If we fail to meet our contractual commitments or otherwise fail to comply with our contractual obligations, then we could be subject to breach of contract or other claims. Any claims, proceedings, individual or mass arbitration demands, or inquiries or investigations initiated by or against us, whether successful or not, may be time-consuming, subject us to damage awards, regulatory orders, consent decrees, injunctive relief, fines, or other penalties or sanctions, require us to change our policies or practices, result in increased operating costs, divert management’s attention, harm our reputation, and require us to incur significant legal fees, other litigation costs and settlement costs, as well as other expenses. In addition, our insurance may not be adequate to protect us from all material expenses related to pending and future claims. Any of these factors could materially and adversely affect our business, financial condition, and results of operations.
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If government regulations or laws relating to the internet, video, advertising, or other areas of our business change, we may need to alter the manner in which we conduct our business, or our business could be harmed.*
We are subject to or affected by general business regulations and laws, as well as regulations and laws specific to the internet and online services, including laws and regulations related to data privacy and security, consumer protection, data localization, law enforcement access to data, encryption, telecommunications, social media, payment processing, subscriptions, taxation, trade, intellectual property, competition, electronic contracts, internet access, net neutrality, advertising, calling and texting, content restrictions, protection of children, and accessibility, among others. We cannot guarantee that we have been or will be fully compliant in every jurisdiction. Litigation and regulatory proceedings are inherently uncertain, and the federal, state, and foreign laws and regulations governing issues such as data privacy and security, payment processing, taxation, net neutrality, liability of providers of online services, video, telecommunications, e-commerce tariffs, and consumer protection related to the internet continue to develop. Moreover, as internet commerce and advertising continue to evolve, increasing regulation by federal, state, and foreign regulatory authorities becomes more likely.
As we develop new services and devices and improve our streaming platform, we may also be subject to new laws and regulations specific to such technologies. For example, in developing the reference design of TVs powered by the Roku OS, we were required to understand, address, and comply with an evolving regulatory framework for developing, manufacturing, marketing, and selling TVs. If we fail to adequately address or comply with such regulations regarding the manufacture and sale of TVs, we may be subject to fines or sanctions, and we or our licensed Roku TV partners may be unable to sell TVs powered by the Roku OS at all, which could harm our business and our ability to grow our user base.
Laws relating to data privacy and security, data localization, law enforcement access to data, encryption, consumer protection, children’s online protection, and similar activities continue to proliferate, often with little harmonization between jurisdictions and limited guidance. A number of bills are pending in the U.S. Congress and other government bodies that contain provisions that would regulate, for example, how companies can use cookies and other tracking technologies to collect, use, and share user information. Certain state laws, such as the CCPA, also impose requirements on certain tracking activity. The EU has laws requiring advertisers or companies like ours to, for example, obtain unambiguous, affirmative consent from users for the placement of cookies or other tracking technologies and the delivery of relevant advertisements. In addition, the EU has adopted the Digital Services Act, which is legislation that updates the liability and safety rules for digital platforms, products, and services. The EU also has adopted the Data Act, which seeks to enhance interoperability and facilitate data sharing and reuse across products and services.
Regulatory inquiries, investigations, and enforcement actions could also impact our business operations. For example, we and other companies in the media, entertainment, and advertising technology industries have been subject to government inquiries and investigations by regulatory bodies with regard to our compliance with data privacy and security laws, the Federal Trade Commission Act, and other applicable laws and regulations. Advocacy organizations have also filed complaints with data protection authorities against businesses with streaming apps and advertising technology, arguing that certain of these companies’ practices do not comply with the CCPA or other regulations. Such inquiries, investigations, or enforcement actions may require us to alter our practices. Further, if we or the third parties that we work with, such as contract payment processing services, content partners, vendors, or developers, violate or are alleged to violate applicable privacy or security laws, laws concerning access to data, industry standards, our contractual obligations, or our policies, such violations and alleged violations may also put our users’ information at risk and could in turn harm our business and reputation and subject us to potential liability. Any of these consequences could cause our users, advertisers, or content partners to lose trust in us, which could harm our business. Furthermore, any failure on our part to comply with these laws may subject us to liability and reputational harm.
Our use of data to deliver relevant advertising and other services on our platform places us and our content partners at risk for claims under various unsettled laws, including the Video Privacy Protection Act (“VPPA”). Some of our content partners have been engaged in litigation over alleged violations of the VPPA relating to activities on our platform in connection with advertising provided by unrelated third parties.
In addition, in 2019, the FTC initiated a review of its rules implementing the Children’s Online Privacy Protection Act (“COPPA”), which limits the collection by operators of online services of personal information from children under the age of 13. Following this review, in December 2023, the FTC issued a formal Notice of Proposed Rulemaking that proposes specific revisions to the COPPA rule and seeks additional public input. Among other topics, the FTC has proposed rule changes that would prohibit targeted advertising to children absent express opt-in consent from parents, strengthen data security requirements for children’s personal information, and limit the period during which children’s personal information can be retained. The review has not been concluded and could result in broadening the applicability of COPPA and other changes.
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There have also been proposals in the U.S. Congress to amend and expand COPPA. Changes to the COPPA legislation or rules could limit the information that we or our content partners and advertisers may collect and use and the content of advertisements in relation to certain app partner content. The CCPA and certain other state privacy laws also impose certain opt in and opt out requirements before certain information about minors can be collected. Many states have incorporated children’s privacy requirements into their laws, and in some cases those requirements impose additional obligations not found in COPPA.
Some states also have adopted Age Appropriate Design Codes. For example, in 2022, California adopted the Age-Appropriate Design Code Act (“AADCA”), which has a stated purpose of protecting “the well being, data, and privacy of children using online platforms.” The AADCA was challenged in court, and a federal appellate court recently agreed that the AADCA’s mandate that required covered businesses to prepare and implement a “Data Protection Impact Assessment” is unconstitutional. Other aspects of the AADCA, however, may be allowed to go into effect. Since adoption of the California law, similar legislation has been introduced in other U.S. states. For example, the Maryland Age-Appropriate Design Code Act, which went into effect on October 1, 2024, is similar in many respects to the California AADCA. The EU and many of its member states, among other jurisdictions, also have rules that limit processing of personal information, including children’s data, and that impose specific requirements intended to protect children online. We and our content partners and advertisers could be at risk for violation or alleged violation of these and other privacy, advertising, children’s online protection, or similar laws. This could subject us to potential legal actions, substantial monetary fines, and other penalties, which could negatively affect our business, financial condition, and results of operations.
Changes in U.S. or foreign trade policies, geopolitical conditions, general economic conditions, and other factors beyond our control may adversely impact our business and operating results.
Our business is subject to risks generally associated with doing business abroad, such as U.S. and foreign governmental regulation in the countries in which we operate and the countries in which our contract manufacturers, component suppliers, and other business partners are located. Our operations and performance depend significantly on global, regional, and U.S. economic and geopolitical conditions.
For example, tensions between the United States and China have led to the United States’ imposition of a series of tariffs, sanctions, and other restrictions on imports from China and sourcing from certain Chinese persons or entities, as well as other business restrictions. Following Russia’s invasion of Ukraine, the United States and other countries imposed economic sanctions and severe export control restrictions against Russia and Belarus, and the United States and other countries could impose wider sanctions and export restrictions and take other actions should the conflict further escalate. In addition, the effects of Brexit on EU-UK political, trade, economic, and diplomatic relations continue to be uncertain and such impact may not be fully realized for several years or more. Continued uncertainty and friction may result in regulatory, operational, and cost challenges to our international operations.
These and other trade disputes, geopolitical tensions, or political uncertainty can disrupt supply chains and increase the cost of our and our partners’ products, and have a negative impact on consumer confidence, which could impair our future growth and adversely affect our international operations, business, financial condition, and results of operations.
Also, various countries, in addition to the United States, regulate the import and export of certain products, commodities, software, and technology, including through import and export licensing requirements, and have enacted laws that could limit our ability to distribute our products or collaborate on technology with our commercial or strategic partners, or could limit the ability of our commercial or strategic partners to implement our products in those countries. Changes in our products or future changes in export and import regulations may create delays in the introduction of our products in international markets, disrupt supply chains, prevent our commercial or strategic partners with international operations from deploying our products globally, or, in some cases, prevent the export or import of our products to certain countries, governments, or persons altogether. Any changes in U.S. or foreign export or import regulations, customs duties, or other restrictions on intangible goods (such as cross-border data flows) could result in decreased use of our products by, or in our decreased ability to export or sell our products and services to, existing or new customers in U.S. or international markets or hamper our ability to source products, components, and parts from certain suppliers or lead to potential supply chain disruptions and business or reputational harms. Any decreased use of our products or limitation on our ability to export, import, or sell our products or services, or source parts or components, could harm our business.
Although we attempt to ensure that we, our retailers, and partners comply with the applicable import, export, and sanctions laws, we cannot guarantee full compliance by all. Actions of our retailers and partners are not within our complete control, and our products could be re-exported to sanctioned persons or countries or provided by our retailers to third persons in contravention of our requirements or instructions or the laws. In addition, there are inherent limitations to the effectiveness of any policies, procedures, and internal controls relating to such compliance, and there can be no assurance that such procedures or internal controls will work effectively at all times or protect us against liability under anti-corruption, sanctions or other laws for actions taken by us, our retailers or partners. Any such potential violation by us, our retailers, or our partners could have negative consequences, including government inquiries, investigations, enforcement actions, monetary fines, or civil and/or criminal penalties, and our reputation, brand, and revenue may be harmed.
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The ability of internet access network operators in some jurisdictions to degrade users’ internet speeds or limit internet data consumption by users, including unreasonable discrimination in the provision of broadband internet access services, could harm our business.*
Our products and services depend on the ability of our users to access the internet. We believe that the continued growth of streaming as an entertainment alternative will depend on the availability and growth of cost-effective broadband internet access (including mobile broadband internet access), the quality and reliability of broadband content delivery, and broadband service providers’ ability to control the delivery speed of different content traveling on their networks. Laws, regulations, or court rulings that adversely affect the popularity or growth in use of the internet, including decisions that undermine open and neutrally administered internet access, or that disincentivize internet access network operators’ willingness to invest in upgrades and maintenance of their equipment, could decrease customer demand for our service offerings, may impose additional burdens on us, or could cause us to incur additional expenses or alter our business model. Some jurisdictions have adopted regulations governing the provision of internet access service. Substantial uncertainty exists in the United States and elsewhere regarding such provisions. For example, in the United States, a federal appellate court recently prevented new FCC “net neutrality” rules and an associated broadband oversight framework from going into effect, finding that the FCC likely does not have statutory authority to adopt such requirements. As a result, there are no FCC rules currently in effect that prohibit internet service providers from unreasonably restricting, blocking, degrading, or charging for access to certain products and services offered by us and our content partners.
If network operators were to engage in restricting, blocking, degrading, or charging for access, it could impede our growth, result in a decline in our quality of service, cause us to incur additional expense, or otherwise impair our ability to attract and retain users, any of which could harm our business. Several states and foreign countries in which we operate also have adopted or are considering rules governing the provision of internet access. In addition, in some jurisdictions (including the United States), network operators are pursuing proposals that would require or enable them to impose fees on content providers related to delivery of network traffic.
As we expand internationally, government regulation protecting the non-discriminatory provision of internet access may be nascent or non-existent. In those markets where regulatory safeguards against unreasonable discrimination are nascent or non-existent and where local network operators possess substantial market power, we could experience anti-competitive practices that could impede our growth, cause us to incur additional expenses, or otherwise harm our business. Future regulations or changes in laws and regulations (or their existing interpretations or applications) could also hinder our operational flexibility, raise compliance costs, and result in additional liabilities for us, which may harm our business.
If we are found liable for content that is distributed through or advertising that is served through our platform, our business could be harmed.
As a distributor of content, we face potential liability for negligence, copyright, patent, or trademark infringement, public performance royalties or other claims based on the nature and content of materials that we distribute. We rely on the statutory safe harbors, as set forth in the Digital Millennium Copyright Act (the “DMCA”), Section 230 of the Communications Decency Act (“Section 230”) in the United States, and the E-Commerce Directive in Europe, for protection against liability for various caching, hosting, and linking activities. The DMCA, Section 230, and similar statutes and doctrines on which we rely or may rely in the future are subject to uncertain judicial interpretation and regulatory and legislative amendments. Any legislation or court rulings that limit the applicability of these safe harbors could require us to take a different approach toward content moderation on our platform, which could diminish the depth, breadth, and variety of content that we offer, inhibit our ability to generate advertising, or otherwise adversely affect our business.
Moreover, if the rules around these statutes and doctrines change, if international jurisdictions refuse to apply similar protections, or if a court were to disagree with our application of those rules to our business, we could incur liabilities and our business could be harmed. If we become liable for these types of claims as a result of the content that is streamed over or the advertisements that are served through our platform, then our business may suffer. Litigation to defend these claims could be costly and the expenses and damages arising from any liability could harm our business. Our insurance may not be adequate to cover these types of claims or any liability that may be imposed on us.
In addition, regardless of any legal protections that may limit our liability for the actions of third parties, we may be adversely impacted if copyright holders assert claims, or commence litigation, alleging copyright infringement against the developers of apps that are distributed on our platform.
While our platform policies prohibit streaming content on our platform without distribution rights from the copyright holder, and we maintain processes and systems for the reporting and removal of infringing content, in certain instances our platform has been misused by unaffiliated third parties to unlawfully distribute copyrighted content. If content owners or distributors are deterred from working with us as a consequence, it could impair our ability to maintain or expand our business, including through international expansion plans.
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If we fail to maintain effective internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and our stock price may be adversely affected.*
We are required to maintain internal control over financial reporting and to report any material weaknesses in such internal control. Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires that we furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting. This assessment must include disclosure of any material weaknesses identified by our management in our internal control over financial reporting. Our independent registered public accounting firm also attests to the effectiveness of our internal control over financial reporting. If we have a material weakness in our internal control over financial reporting in the future, we may not detect errors on a timely basis, and our financial statements may be materially misstated.
Any failure to maintain internal controls over financial reporting could severely inhibit our ability to accurately report our financial condition or results of operations. If we identify material weaknesses in our internal control over financial reporting, are unable to continue to comply with the requirements of Section 404 in a timely manner, are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our Class A common stock could be adversely affected. In addition, we could become subject to investigations by the SEC, The Nasdaq Global Select Market, or other regulatory authorities, which could require additional financial and management resources.
Our financial results may be adversely affected by changes in accounting principles applicable to us.
The generally accepted accounting principles in the United States are subject to interpretation by the Financial Accounting Standards Board, the SEC, and other bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported results of operations and may even affect the reporting of transactions completed before the announcement or effectiveness of a change. It is difficult to predict the impact of future changes to accounting principles or our accounting policies, any of which could harm our business.
If we fail to comply with the laws and regulations relating to the payment of income taxes and the collection of indirect taxes, we could be exposed to unexpected costs, expenses, penalties, and fees as a result of our noncompliance, which could harm our business.
We are subject to requirements to deduct or withhold income taxes on revenue sourced in various jurisdictions, pay income taxes on profits earned by any permanent establishment (or similar enterprise) of ours that carries on business in various jurisdictions, and collect indirect taxes from our sales in various jurisdictions. The laws and regulations governing the withholding and payment of income taxes and the collection of indirect taxes are numerous, complex, and vary by jurisdiction. A successful assertion by one or more jurisdictions that we were required to withhold or pay income taxes or collect indirect taxes where we did not could result in substantial tax liabilities, fees, and expenses, including substantial interest and penalty charges, which could harm our business.
New legislation that would change U.S. or foreign taxation of international business activities or other tax-reform policies could harm our business.
We earn a portion of our income in foreign countries and, as such, we are subject to tax laws in the United States and numerous foreign jurisdictions. Current economic and political conditions make tax laws and regulations, or their interpretation and application, in any jurisdiction subject to significant change.
Proposals to reform U.S. and foreign tax laws could significantly impact how U.S. multinational corporations are taxed on foreign earnings and could increase the U.S. corporate tax rate. Although we cannot predict whether or in what form these proposals will pass, several of the proposals under consideration, if enacted into law, could have an adverse impact on our effective tax rate, income tax expense, and cash flows.
In addition, both tax policy and tax administration are becoming multilateral. This multilateralism and collaboration among taxing authorities (including the U.S. and many foreign jurisdictions in which we operate) has resulted in proposed new tax measures specifically targeting online commerce, digital services, streaming services, and the remote sale of goods and services. Some of these measures (such as a global corporate minimum tax) require adoption of local legislation consistent with the agreed to multilateral framework. Other measures (such as digital services taxes) have already been implemented but may terminate upon the adoption of multilateral tax rules.
The rapid growth of multilateralism in tax administration means greater sharing of tax information among taxing authorities as well as the likelihood of joint and simultaneous tax audits of companies such as ours who have cross-border business activities in which the tax administrations may have a common or complementary interest. The results of any such audits or related disputes could have an adverse effect on our financial results for the period or periods for which the applicable final determinations are made. For example, we and our subsidiaries are engaged in intercompany transactions across multiple tax jurisdictions. Although we believe we have clearly reflected the economics of these transactions and that the proper local transfer pricing is in place, tax authorities may propose and sustain adjustments that could result in changes that may impact our mix of earnings in countries with differing statutory tax rates.
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Risks Related to Ownership of Our Class A Common Stock
The dual class structure of our common stock concentrates voting control with those stockholders who held our stock prior to our initial public offering, including our executive officers, employees, and directors and their affiliates, and limits the ability of holders of our Class A common stock to influence corporate matters.*
Our Class B common stock has 10 votes per share, and our Class A common stock has one vote per share. Our President and Chief Executive Officer, Anthony Wood, holds and controls the vote of a significant number of shares of our outstanding common stock, and therefore Mr. Wood will have significant influence over our management and affairs and over all matters requiring stockholder approval, including election of directors and significant corporate transactions, such as a merger or other sale of Roku or our assets, for the foreseeable future. If Mr. Wood’s employment with us is terminated, he will continue to have the same influence over matters requiring stockholder approval.
In addition, the holders of Class B common stock collectively will continue to be able to control all matters submitted to our stockholders for approval even if their stock holdings represent less than a majority of the outstanding shares of our common stock. This concentrated control will limit the ability of holders of our Class A common stock to influence corporate matters for the foreseeable future, and, as a result, the market price of our Class A common stock could be adversely affected.
Future transfers by holders of Class B common stock will generally result in those shares converting to Class A common stock, which has the effect, over time, of increasing the relative voting power of those holders of Class B common stock who retain their shares in the long term. As a result of such transfers, as of September 30, 2024, Mr. Wood controls a majority of the combined voting power of our Class A and Class B common stock even though he only owns 12.1% of the outstanding Class A and Class B common stock. As a member of our Board of Directors (our “Board”), Mr. Wood owes a fiduciary duty to our stockholders and must act in good faith in a manner he reasonably believes to be in the best interests of our stockholders.
As a stockholder, even a controlling stockholder, Mr. Wood is entitled to vote his shares in his own interests, which may not always be in the interests of our stockholders generally. This concentrated control could delay, defer, or prevent a change of control, merger, consolidation, or sale of all or substantially all of our assets that our other stockholders support, or conversely this concentrated control could result in the consummation of such a transaction that our other stockholders do not support. This concentrated control could also discourage a potential investor from acquiring our Class A common stock, which has limited voting power relative to the Class B common stock and might harm the market price of our Class A common stock.
We have not elected to take advantage of the “controlled company” exemption to the corporate governance rules for companies listed on The Nasdaq Global Select Market.
The market price of our Class A common stock has been, and may continue to be, volatile, and the value of our Class A common stock may decline.*
The market price of our Class A common stock has been and may continue to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, including:
•actual or anticipated fluctuations in our financial condition, operating results, and key performance metrics;
•changes in projected operational and financial results;
•our loss of key content partners;
•changes in laws or regulations applicable to our products or platform;
•the commencement or conclusion of legal proceedings that involve us;
•actual or anticipated changes in our growth rate relative to our competitors;
•announcements of new products or services by us or our competitors;
•announcements by us or our competitors of significant acquisitions, strategic partnerships, or joint ventures;
•capital-raising activities or commitments;
•additions or departures of key personnel;
•issuance of new or updated research or reports by securities analysts;
•the use by investors or analysts of third-party data regarding our business that may not reflect our financial performance;
•fluctuations in the valuation of companies perceived by investors to be comparable to us;
•the perception that our environmental, social, and corporate governance performance is inadequate compared to that of our competitors;
•sales of our Class A common stock, including short selling of our Class A common stock;
•share price and volume fluctuations attributable to inconsistent trading volume levels of our shares;
•general economic and market conditions; and
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•other events or factors, including those resulting from civil unrest, war, foreign invasions, terrorism, or public health crises, or responses to such events.
Furthermore, the stock markets frequently experience extreme price and volume fluctuations that affect the market prices of equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political, and market conditions such as recessions, elections, interest rate changes, or international currency fluctuations, may negatively impact the market price of our Class A common stock. As a result of such fluctuations, you may not realize any return on your investment in us and may lose some or all of your investment. In addition, we and other companies that have experienced volatility in the market price of their stock have been, and may in the future be, subject to securities class action litigation or derivative litigation. Such litigation could result in substantial costs and divert our management’s attention from other business concerns.
Future sales and issuances of our capital stock or rights to purchase capital stock could result in additional dilution of the percentage ownership of our stockholders and could cause our stock price to decline.
We may issue additional securities in the future and from time to time. Future sales and issuances of our capital stock or rights to purchase our capital stock could result in substantial dilution to our existing stockholders. We may sell or issue Class A common stock, convertible securities, and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time. If we sell any such securities in subsequent transactions, investors may be materially diluted. New investors in such subsequent transactions could gain rights, preferences, and privileges senior to those of holders of our Class A common stock.
Future sales of shares by existing stockholders could cause our stock price to decline.
If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our Class A common stock in the public market, the market price of our Class A common stock could decline. All of our outstanding Class A shares are eligible for sale in the public market, other than shares and stock options exercisable held by directors, executive officers, and other affiliates that are subject to volume limitations under Rule 144 of the Securities Act. In addition, we have reserved shares for future issuance under our equity incentive plan. Our directors, employees, and certain contingent workers are subject to our quarterly trading window, which generally opens at the start of the second full trading day after the public dissemination of our annual or quarterly financial results and closes (i) with respect to the first, second, and third quarter of each year, at the end of the fifteenth day of the last month of such quarter and (ii) with respect to the fourth quarter of each year, at the end of the trading day on the Wednesday before Thanksgiving. These directors, employees, and contingent workers may also sell shares during a closed window period pursuant to trading plans that comply with the requirements of Rule 10b5-1(c)(1) under the Exchange Act. When these shares are issued and subsequently sold, it is dilutive to existing stockholders and the market price of our Class A common stock could decline.
If securities or industry analysts do not publish research or publish unfavorable research about our business or if they downgrade our stock, our stock price and trading volume could decline.
A limited number of equity research analysts provide research coverage of our Class A common stock, and we cannot assure you that such equity research analysts will adequately provide research coverage of our Class A common stock. A lack of adequate research coverage may adversely affect the liquidity and market price of our Class A common stock.
If securities or industry analysts cover our company and one or more of these analysts downgrades our stock or issues other unfavorable commentary or research, the price of our Class A common stock could decline. If one or more equity research analysts cease coverage of our company, or fail to publish reports on us regularly, demand for our stock could decrease, which in turn could cause our stock price or trading volume to decline.
We incur costs and demands upon management as a result of complying with the laws and regulations affecting public companies in the United States, which may harm our business.
As a public company listed in the United States, we incur significant legal, accounting, and other expenses. In addition, changing laws, regulations, and standards relating to corporate governance and public disclosure, including SEC and The Nasdaq Global Select Market regulations, may increase legal and financial compliance costs and make some activities more time-consuming. These laws, regulations, and standards are subject to varying interpretations and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. We invest resources to comply with evolving laws, regulations, and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If, notwithstanding our efforts, we fail to comply with new laws, regulations, and standards, regulatory authorities may initiate legal proceedings against us, and our business may be harmed.
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Failure to comply with these rules might also make it more difficult for us to obtain certain types of insurance, including director and officer liability insurance, and we might be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our Board, on committees of our Board, or as members of senior management.
We do not intend to pay dividends in the foreseeable future.*
We have never declared or paid any cash dividends on our Class A or Class B common stock and do not intend to pay any cash dividends in the foreseeable future. We anticipate that we will retain all of our future earnings to grow our business and for general corporate purposes. Moreover, our Credit Agreement contains prohibitions on the payment of cash dividends on our capital stock. Accordingly, investors must rely on sales of their Class A common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.
Provisions of our charter documents and Delaware law may prevent or frustrate attempts by our stockholders to change our management or hinder efforts to acquire a controlling interest in us, and the market price of our Class A common stock may be lower as a result.
There are provisions in our certificate of incorporation and bylaws that may make it difficult for a third party to acquire, or attempt to acquire, control of our company, even if a change in control was considered favorable by our stockholders. Our charter documents also contain other provisions that could have an anti-takeover effect, such as:
•establishing a classified Board so that not all directors are elected at one time;
•permitting our Board to establish the number of directors and fill any vacancies and newly created directorships;
•providing that directors may only be removed for cause;
•prohibiting cumulative voting for directors;
•requiring super-majority voting to amend some provisions in our certificate of incorporation and bylaws;
•authorizing the issuance of “blank check” preferred stock that our Board could use to implement a stockholder rights plan;
•eliminating the ability of stockholders to call special meetings of stockholders;
•prohibiting stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; and
•reflecting our two classes of common stock as described above.
Moreover, because we are incorporated in Delaware, we are governed by Section 203 of the Delaware General Corporation Law, which prohibits a person who owns 15% or more of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner. Any provision in our certificate of incorporation or our bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock and could affect the price that some investors are willing to pay for our Class A common stock.
Our certificate of incorporation provides that the Delaware Court of Chancery and the U.S. federal district courts will be the exclusive forums for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Our certificate of incorporation provides that the Delaware Court of Chancery is the exclusive forum for the following types of actions or proceedings under Delaware statutory or common law:
•any derivative action or proceeding brought on our behalf;
•any action asserting a breach of fiduciary duty;
•any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our certificate of incorporation, or our bylaws; and
•any action asserting a claim against us that is governed by the internal affairs doctrine.
This provision would not apply to suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all Securities Act actions. Accordingly, both state and federal courts have jurisdiction to entertain such claims.
To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our certificate of incorporation provides that the U.S. federal district courts will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
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While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions. In such instance, we would expect to vigorously assert the validity and enforceability of the exclusive forum provisions of our certificate of incorporation. This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions.
These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for certain disputes with us or our directors, officers, or other employees, which may discourage lawsuits against us and our directors, officers, and other employees. If a court were to find either exclusive forum provision in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving such action in other jurisdictions, all of which could harm our business.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Insider Trading Arrangements
During the three months ended September 30, 2024, the following officers (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
Name Action Adoption/Termination Date Trading Arrangement Total Shares of Class A Common Stock to be Sold Expiration Date
Rule 10b5-1*Non-Rule 10b5-1**
Anthony Wood***
(Chief Executive Officer, President, and Chairman)
AdoptionSeptember 11, 2024X300,000 June 9, 2025
___________________
* Contract, instruction or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act.
** “Non-Rule 10b5-1 trading arrangement” as defined in Item 408(c) of Regulation S-K under the Exchange Act.
*** Trading arrangement adopted by The Wood Revocable Trust, of which Mr. Wood and his spouse are co-trustees.
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Item 6. Exhibits
  Incorporation by reference
Exhibit
Number		DescriptionFormSEC File No.ExhibitFiling DateFiled Herewith
      
3.18-K001-382113.110/3/2017
3.2S-1/A333-2203183.49/18/2017
4.1
Reference is made to Exhibits 3.1 through 3.2.
    
4.2S-1/A333-2203184.19/18/2017
10.18-K001-3821110.1
9/17/2024
10.2
8-K
001-38211
10.19/26/2024

31.1   X
31.2    X
32.1*    X
32.2*    X
101
The following information from Roku, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 formatted in Inline XBRL (Extensible Business Reporting Language) includes (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Income (Loss), (iv) the Condensed Consolidated Statements of Cash Flows, and (v) Notes to Condensed Consolidated Financial Statements.
    X
104
Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)
    
X
* These exhibits are furnished with this Quarterly Report and are not deemed filed with the Securities and Exchange Commission and are not incorporated by reference in any filing of Roku, Inc. under the Securities Act of 1933, as amended, or the Securities and Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language contained in such filings.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Quarterly Report to be signed on its behalf by the undersigned thereunto duly authorized.
 Roku, Inc.
   
Date: October 31, 2024
By:/s/ Anthony Wood
  Anthony Wood
  
President, Chief Executive Officer and Chairman
(Principal Executive Officer)
   
Date: October 31, 2024
By:/s/ Dan Jedda
  Dan Jedda
  
Chief Financial Officer
(Principal Financial Officer)
Date: October 31, 2024
By:/s/ Matthew Banks
Matthew Banks
Vice President, Corporate Controller and Chief Accounting Officer
(Principal Accounting Officer)
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