Roku is doing more than ever, but focus is still its secret ingredient

It’s easy to forget how big a splash the first Roku box made when it debuted on May 20, 2008. At launch, the device worked only with Netflix, best known at the time as a mail-order Blockbuster rival that was just ramping up its streaming service. The 10,000 movies and shows you could watch skewed toward the random and musty: Back then, Netflix’s mail-order DVD service offered 10 times as many titles.

But the $100 Netflix Player by Roku took a process that had been geeky at best—getting internet video onto a TV—and made it approachable and affordable. In the unassuming gadget, wrote The New York Times’s Saul Hansell, “I think you can see the future of video.”

Hansell was right. And though that original box has grown quaint with time, Roku is still riding the streaming wave. The company ended 2024 with 89.8 million streaming households, an increase of 9.8 million year over year. In the first quarter of 2025, it streamed 35.8 billion hours of video, up 5.1 billion year over year—and more than 10 times what it was doing per quarter when it went public in 2017.

Behind the scenes, Roku has constructed a diversified business to keep those figures growing and monetize them in new ways. Yes, it still makes streaming boxes, along with streaming sticks and soundbars. However, it also provides North America’s most popular operating system for smart TVs, which it licenses to other manufacturers and uses on its own Roku-branded televisions. It operates the Roku Channel, the most-watched free ad-supported streaming channel, having recently passed Tubi. It’s a powerhouse of streaming ads, giving marketers tools such as Roku Ads Manager and Roku Data Cloud.

That Roku found itself in a place to build all this involved an early twist of fate. Founder and CEO Anthony Wood oversaw the first streaming box’s development as a skunkworks project for Netflix. When Netflix decided it didn’t want to sell a device of its own, Roku—which had made internet radios and digital signage controllers, among other products—inherited it. With the introduction of the Roku Channel Store in November 2009, the box began to evolve from a Netflix player into a comprehensive streaming portal. The Channel Store launched with 10 providers, including Pandora and Flickr; the company doesn’t disclose the current number, but it’s in the thousands, including more than 500 free ones.

“It’s amazing how companies underestimate that,” Wood says. “They still do. They don’t really understand what it means. For example, sometimes people will be like, ‘Your UI, your home screen, hasn’t changed that much.’ Like that’s terrible. And I’m like, ‘No, our market share keeps going up!’ So it’s not terrible. People like that.”

Anyone who scoffs at Roku’s lack of change for change’s sake might want to consider how successful it’s been in a business that many others, including Google and Amazon, have long coveted. “When you think about the power of an operating system, in the mobile world you think of Apple and Google being the two dominant platforms,” says media and technology analyst Rich Greenfield of LightShed Partners. “In connected TV, the platform that is far and away the largest is Roku.”

Hardware is hard

Wood’s early realization that devices were most valuable as a springboard to build a platform did not involve any unique insight. Everyone in consumer electronics knows that hardware is hard and services can drive profits. But Roku has been one of the few consumer electronics companies to make it all work—certainly more consistently so than Sonos and GoPro, both of which have been through more than their share of tribulations in recent years. (Fun fact: All three companies were founded in 2002.)

Just as Wood anticipated, Roku became a services company. In the first quarter of 2025, it made $881 million in revenue from its platform business, which spans advertising, subscriptions, and software licensing, with a gross profit of 53%. In devices, it had $140 million in revenue but a $19 million loss, for a margin of minus 14%. Overall, the company reported a loss from operations of $58 million and an adjusted EBITDA of $56 million, compared to a $72 million loss and adjusted EBITDA of $41 million for the first quarter of 2024.

If you’re watching the Roku Channel—or another streaming service that’s part of the Roku Audience Network—you see ads the company has inserted in streams. (Overall, according to data from Pixalate, 38% of connected-TV programmatic ads in the first quarter of 2025 were delivered to Roku viewers, the highest percentage of any platform; Amazon’s Fire TV was second with 18%.) If you’re watching something else, such as Disney+ or Max, Roku can monetize that, too: Its built-in payments service, Roku Pay, lets it handle billing in return for a fee.

Roku’s use of its platform as a giant marketing opportunity for its streaming partners extends to everything from its home screen and screen saver to the dedicated app-specific buttons on its familiar remote control; in March, it raised eyebrows by testing ads that play even before the home screen loads. As I was finishing this article, the platform was thick with messages promoting discounts associated with Streaming Day on May 20—a holiday it invented to celebrate the anniversary of its first box.

Anti-Roku sentiment expressed online usually reflects frustration with the quantity of advertising and other promotional elements, though the company recently got blamed for some ads it didn’t place. Wood says that customer satisfaction studies help determine changes to the platform, but in some cases tweaks get the go-ahead even “if there’s a very neutral [reaction] or a slight decrease in satisfaction. Because you’ve got to remember, the revenue ultimately [results] in more content, more free content, more features, and lower cost.” Overall, he adds, “Those revenue streams have really worked for us—distributing streaming services, merchandising them, selling them, billing for them, and free content with ads.”

If Roku hadn’t done an intrepid job of navigating a TV hardware ecosystem that’s radically changed since it shipped its early devices, it wouldn’t have a booming ad business. Back then, few people owned smart TVs; the company’s competition consisted of other boxes, most of which were clunkier and costlier than its own. But as streaming took off, most TVs added it as a standard feature. Theoretically, that could have rendered Roku and its add-on boxes redundant.

The reality, however, was that the home-brewed software cobbled together by many TV manufacturers was terrible. That opened up an opportunity for Roku, whose interface was already widely praised for its polish and straightforwardness. In 2014, the company introduced Roku TV, a platform designed to be embedded into televisions rather than delivered via a box. It launched on models from China’s TCL and Hisense, respectively the third- and fifth-largest TV brands at the time.

Looking back, Wood says that TV makers were skittish about ceding control of the on-screen experience. “When we first started going to TV companies, one of the biggest challenges we had was they all wanted a custom UI, and they didn’t want their UI to look like their competitors,” he remembers. In the end, many were convinced to standardize on Roku, which now ships on TVs from 35 brands, including JVC, Walmart’s Onn house brand, Philips, and Westinghouse. In some cases, they play up the platform’s brand and benefits on their packaging even more than their own.

Among the TV manufacturers who still don’t offer Roku models are three of the best-known brands: Samsung, LG, and Sony. Wood contends that’s worse news for them than for Roku. “Samsung still makes their own platform,” he says. “They just don’t have enough scale and monetization, even as large as they are, to do what we do in terms of features. . . . And so we’re just a better product, and consumers care about that.”

Then there are the most Roku-centric TVs of all. In 2023, the company introduced its own line of televisions; it went on to sell a million of them in 2024. Are the TV makers who license Roku’s software okay with it competing with their products? “They’d probably prefer we didn’t,” allows Wood, who calls it “just another move to build market share.” Along with catering to customers who want the purest possible Roku experience, doing so lets the company test new features before rolling them out more widely, he explains. It also helps retailers plug holes in their TV lineups when they can’t get all the models they’d like from other brands.

At the launch event where I spoke with Wood, Roku unveiled its 2025 line of TVs. But it also introduced two new add-on streaming devices—not boxes but sticks that plug directly into a TV’s HDMI port, a diminutive form factor the company has offered since 2012. It’s still finding ways to improve them: The new models are slimmer than their predecessors, so they don’t block adjacent HDMI ports. They also draw power from the TV, eliminating the need for a cable and charging plug.

Given that it’s now tough to buy a TV that doesn’t have streaming features built in, how is it possible that these sticks are still a thing? Even inside Roku, Wood says, many people expected the market for them to trend sharply toward zero. So far, it hasn’t: “Every year we keep selling them—we sell a lot of streaming sticks.” Some customers, he says, use them to upgrade aging smart TVs whose built-in software is no longer getting updates. Others may simply prefer Roku to other streaming interfaces.

Roku’s continued focus on streaming shows a fair amount of discipline given that its brand is among the most recognizable in smart home technology. (Google’s Nest, by contrast, has migrated from thermostats to security systems, speakers, screens, Wi-Fi routers, and other products but lost its early buzz along the way.) Not that Roku hasn’t played around the edges: In 2022, I wrote about its foray into cameras and doorbells. Rather than lavishing attention on the project, it started with devices built by Wyze and then provided security and software upgrades, along with integrations with its TV platform.

Today, Roku sells millions of products a year based on its Wyze partnership and is still rolling out new models. But the initiative shows no signs of broadening into an all-out effort to conquer every area of household tech. “Our primary business is streaming, but it’s kind of a nice accessory,” Wood says.

It’s a channel, too

For much of its history, Roku expanded the utility of its devices by supporting new streaming services as they came along. By 2017, its Channel Store had more than 5,000 of them, from the expected name-brand giants to upstarts representing an array of niches. That was the year it launched a service of its own, called—perhaps inevitably—the Roku Channel. That move went on to transform how the company made money by letting it sell ads on its own streams. Today, “It’s a multibillion-dollar business for us,” Wood says.

Having its own channel also gave Roku the opportunity to simplify streaming even more by taking responsibility for what Steve Jobs would have called the whole widget—the entire experience from the design of the remote control to the lineup of shows. “In some ways, the Roku Channel is at the center of what they’re doing,” says LightShed’s Greenfield.

Calling it a mere “channel” is a bit of a misnomer, though. It’s become a sprawling streaming service unto itself, with on-demand movies and episodes, live channels, and premium for-pay options such as Starz, AMC+, and the service soon to be known once again as HBO Max. The Roku Channel also has a life well beyond Roku’s own platform: You can watch it on the web, using iPhone and Android apps, or even on two of Roku’s archrivals, Google TV and Amazon’s Fire TV.

Almost eight years into its existence, the Roku Channel has quietly gobbled up a meaningful percentage of the hours humans spend consuming video content. In April, according to Nielsen’s the Gauge, it accounted for 2.4% of all TV watched by people ages 2 and up (sorry, babies). That might not sound huge, but it’s 2.4% of all TV—broadcast and cable as well as streaming—and is up 71% year over year. And though it’s below YouTube (12%), Netflix (7.9%), Disney’s streaming services (5%), Amazon Prime Video (3.5%), and Paramount’s services (2.3%), it beats Tubi (1.9%), HBO Max and Warner Bros. Discovery’s other services (1.5%), and Peacock (1.4%). Roku itself says that the Roku Channel’s streaming hours are up 84% year over year, and that it’s the platform’s No. 2 service among U.S. watchers in terms of engagement. (The company doesn’t officially disclose which one is No. 1, but according to one source, it’s YouTube.)

Contentwise, what Roku is streaming on its service bears a certain resemblance to Netflix in its early, pre-House of Cards days, before it shifted decisively to original content. There are vast quantities of recognizable TV