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Roku (ROKU)
#1
However, the participating channels do have something to gain, if not exposure – advertising revenue. Roku says its own in-house ad sales team is in charge of selling ads against the content on “The Roku Channel;” and while the company declined to detail what the rev share is with its publisher partners, it’s clear that one exists.

Roku launches its own channel featuring free, ad-supported movies | TechCrunch

And eMarketer says Roku is now the most popular streaming platform in the U.S. However, until today, most of what users stream on Roku comes from channels that don’t impact Roku’s bottom line. Roku has over 5,000 channels, but in its S-1 filing, it said Netflix accounts for a third of its streaming hours. Netflix doesn’t add to Roku’s revenue; nor does Roku’s most popular ad-supported service, YouTube.

Roku launches its own channel featuring free, ad-supported movies | TechCrunch

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#2
Sky today announced the NOW TV Smart Stick in the UK. Sky is the first Roku Powered licensee to launch a streaming stick with voice search and TV power & volume controls integrated into the remote control. The NOW TV Smart Stick is expected to be available next month for just £14.99.

Sky Debuts First Roku Powered Streaming Stick with Voice Search Remote

However, the participating channels do have something to gain, if not exposure – advertising revenue. Roku says its own in-house ad sales team is in charge of selling ads against the content on “The Roku Channel;” and while the company declined to detail what the rev share is with its publisher partners, it’s clear that one exists. Also of note, Roku says it wants to make watching ad-supported movies less painful than on other streaming services or traditional TV. “The main things were focused on is limiting the commercial breaks, and the timing and placement,” explains Roku CMO Matthew Anderson, of how Roku designed the ad experience on The Roku Channel. “We’re looking at some of the things that have frustrated viewers in the [over-the-top] environment either on or off the Roku platform, and we’ve tried to take those away,” he says. That means the ads will be smartly placed with respect the content they interrupt, for example, and Roku won’t annoyingly repeat the same ads over and again, which drives viewers crazy. And Roku will have half as many ads as on linear TV – a place where you’d normally find 16 minutes of commercial breaks per hour, on average. The ads will also be somewhat personalized, if the advertiser chooses. “We’ve built up a pretty significant advertising organization, both from the standpoint of handling ad sales, but also from the standpoint of all the ad operations and ad tech that goes into a service like ours,” notes Anderson. However, until today, most of what users stream on Roku comes from channels that don’t impact Roku’s bottom line. Roku has over 5,000 channels, but in its S-1 filing, it said Netflix accounts for a third of its streaming hours. Netflix doesn’t add to Roku’s revenue; nor does Roku’s most popular ad-supported service, YouTube.

Roku launches its own channel featuring free, ad-supported movies | TechCrunch

As might be expected from an electronics company, Roku's player segment accounted for 74% of its revenues in 2016, while its platform segment provided the other 26%. But that balance has been changing rapidly, thanks to the company's fast-growing ad sales business. In the first half of this year, Roku's player segment provided just 59% of its revenues, while its platform segment was up to 41%. In addition to ad revenue, the company's platform segment also includes commissions Roku gets from sales of subscriptions or transactions made through its devices or smart TVs that use its interface. When a user rents a movie on particular video services or signs up for a subscription to a streaming service like Hulu, Roku gets a cut. Roku also earns money by offering branded channel buttons on its remote controls. Consumers see shortcut buttons for streaming services like Netflix, Google Play, Hulu, Sling, and Amazon.

Roku filed for an IPO; here's how it makes money. - Business Insider

Its advertising platform includes interactive video ads that allow advertisers to include customized clickable overlays that allow viewers to watch additional videos, obtain offer details, get a coupon code via text or find the nearest retailer to buy a product.

How does Roku make money? | VatorNews

“It’s exceeded our expectations and is already material contributor to the video inventory that we sell through our advertisers,” Scott Rosenberg, GM and SVP of advertising, said on the fiscal call. In addition to distributing content via the ad-supported Roku Channel, content holders can use a program called “Roku Direct Publisher,” which enables them to produce a dedicated app in the Roku Channel store. “That content can also be syndicated and shown inside of the Roku Channel,” said Rosenberg. “So, it acts as a way to drive additional traffic, additional audience past content partners content.”

Roku Putting Emphasis on Content Distribution – Media Play News

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#3
Earlier this year, analysts at KeyBanc estimated the ROKU had a 35% hold over the video streaming player space, selling its operating system in about 20% of smart TVs in North America in 2017.  While much of video streaming has moved to ad-free environments, bulls on the Street are optimistic about Roku's new ad-supported Roku Channel. Needham noted that since Roku's ad business doesn't have text ads or programmatic ads, it is able to command "premium CPMs" of between $30 and $100. She added that Roku should benefit as the streaming space becomes increasingly crowded with tech giants such as Amazon.com Inc.  and traditional media companies like the Walt Disney Co. competing against global leader Netflix Inc.. This is because Roku gets a cut of revenue when consumers sign up for additional services.

Roku to Jump 20% Thanks to New Offerings: Bulls | Investopedia

The company best known for its streaming devices made more money with ads and licensing fees than with hardware sales for the first time in its corporate history this past quarter. Roku generated $61.5 million with the sale of streaming pucks and sticks during the first quarter of this year, and $75.1 million with advertising and licensing fees.

Roku Q1 2018 Earnings: A, Licensing Revenue Surpasses Hardware Sales – Variety

Half of Roku’s new users came from Roku smart TVs built by companies like TCL, with Wood telling Variety that 1 in 4 TVs sold in the U.S. during the quarter were Roku TVs. The company also revealed in its letter to investors that almost half of Roku’s active users have cut the cord, or never had a pay TV subscription to begin with. It went on to argue that media companies would increasingly target those consumers by licensing their content to players like Roku instead of trying to build out their own streaming services.

Roku Q1 2018 Earnings: A, Licensing Revenue Surpasses Hardware Sales – Variety

In addition to advertising revenue, Platform also includes money made from sales and subscriptions sold through Roku. So, essentially, if someone makes a rental, or signs up for a streaming service, Roku takes a percentage of that sale. The Motely Fool pegs that percentage at 20 percent, down from 30 percent a few years ago. Roku channels include Netflix, HBO, Hulu, Amazon, ABC, CW, PBS and YouTube.

How does Roku make money? | VatorNews

Ad-supported channels may have to share up to 30% of video ad inventory so that Roku can sell ads for itself. The company often doesn't do this for channels with small audiences. For paid channels, including both subscription and transactional content, Roku keeps 20% of revenue (net of credits and refunds). This was lowered from a prior revenue sharing level of 30% back in late 2015. Roku only recognizes its net share in its financial statements.

How Roku Makes Its Money

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#4
Just saw your article on ROKU, which is another of my holdings. Curious what your position is. It sounds from the article like you've held ROKU for some time. Is there a point in this rout where you begin adding, or are you waiting for momentum to shift first? Any thoughts on a bottom? We bounced a bit yesterday off the approximate day one closing price. Charts seem to point to $19 if this doesn't hold.
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#5
Yea, held ROKU in the SHU portfolio for quite a while, as I don't really see a fundamental change I don't change the holding, although adding when the markets are so volatile, well, dunno about that yet.
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#6
Quote:Shares of Roku (ROKU) are sliding after Comcast (CMCSA) announced that its Xfinity Flex, a Roku-like streaming player, is now free for internet-only customers. This comes as Guggenheim analyst Michael Morris raised his price target on Roku shares to $170 from $119, saying he sees an "underappreciated opportunity" for the company to drive significant growth as it expands internationally and numerous new streaming video services launch.

STREAMING BOX FREE FOR INTERNET CUSTOMERS: Comcast announced that Xfinity Flex is now included with an Xfinity Internet-only subscription, "providing millions of new and existing customers with the ability to easily access their favorite streaming services and manage their connected home devices right on the TV." An Xfinity Flex box is included, along with the Xfinity Voice Remote, at no additional cost as part of an Xfinity Internet-only subscription, the company said. Additional boxes will be available to lease for $5 per month per box, with a limit of two boxes per customer, Comcast added.

FACEBOOK PORTAL: Meanwhile, Facebook (FB) has announced its $149 Portal TV device, which supports video calls that get streamed to a TV set and also allows users to watch various programs. In a blog post, the company said that, "We're expanding the Portal family of home video-calling devices with three new models: Portal, Portal Mini and Portal TV. […] Portal TV brings smart video-calling to the largest screen in your home. It sits discreetly on top of or below your television for immersive video calling, giving you the freedom to move around during calls and still be seen and heard. […] With the Amazon [AMZN] Prime Video app on Portal, you can stream your favorite shows and movies, including Amazon Originals. You can also download other apps like SHOWTIME, CBS [CBS] All Access, Starz (LGF.A), Pluto TV, Red Bull TV and Neverthink with more apps coming soon. Portal also has a great speaker so you can listen to your favorite music from Spotify (SPOT), Pandora (P) and iHeartRadio and iHeartRadio [IHRT] Family."

UNDERAPPRECIATED OPPORTUNITY:  In a research note to investors, Guggenheim's Morris raised his price target for Roku to $170 from $119, while reiterating a Buy rating on the shares. As the company expands its international offering and numerous new streaming video services launch with global growth ambitions, the analyst sees "underappreciated opportunity" for the company to drive significant economic growth and create value for shareholders. Overall, Morris believes the company is "uniquely well positioned" to benefit from the significant secular shift to streaming video consumption and targeted advertising demand. He also highlighted that its mobile app download trends showed "industry-leading momentum" in August.

In a research note published back in August, William Blair analyst Ralph Schackart said he expects Roku to experience similar phased stages of international growth as Netflix (NFLX) did during its international expansion. He has an Outperform rating on Roku's shares.
 Breaking News: ROKU latest news. - The Fly
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