Roku (ROKU) 30 Oct 242024 Q3 Earnings call transcript

Good day, everyone. And thank you for standing by. Welcome to the Third Quarter 2024 Roku Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

Now I will pass the call over to Conrad Grodd, Vice President of Investor Relations. ahead. go Please

Media; to today's Welcome CEO; Quarter Earnings President XXXX Dan President Thanks, are Roku's Anthony On Roku Collier, Charlie call our and Mustafa Wood, Call. Ozgen, Jedda, Devices. Carmen. CFO, Third and Roku's and Founder

letter. results make commentary are and and and materially period. actual are GAAP otherwise to forward-looking letter statements, results comparable our available non-GAAP will On roku.com/investor. uncertainties, management for comparisons to XXXX website We'll these the stated, differ Reconciliations risk cause could to filings to non-GAAP measures SEC from financial and risks measures letter IR which periodic present our for all at additional our please financial of this Unless full in measures. shareholder that the against Our also on comparable shareholder call, be GAAP are shareholder most statements. results provided refer we'll subject the forward-looking our factors in our

to Now I'd hand Anthony. to like over call the

the We OS straight years, third the quarter for in demand Conrad. simplicity, platform build was been and U.S., that the deeper our have more Roku through growing OS DSPs major is this selling Roku TV with selling QX, year-over-year. net our total innovation, we reach to and by TV in in our to revenue, results third-party delivered subscriptions. hours the the streaming ad was up growing been The Roku in our lead more of driver platform the continued billion $X delight. Roku and going was we focused than grow TV, U.S. this A on on on year, expect and again from includes X of integrations app it engagement OS revenue. platform into as #X our than build growth Mexico. QX both value home benefit position first the at platform's #X the has This Canada #X such screen which to initiatives also XX% forward. Channel quarter and strong Thanks, and

continued Roku in execute organized platform On helped Zone subscribers Olympics, grew and events, games year-over-year. the the engagement screen QX, These our and content the partners. and In against also the these to grow Sport and home revenue and drove MLB, zones QX, we initiatives NFL. for our to use XX% including

the experiences Additionally, zone opportunities. broadened sport viewer other and our sponsorship

positive we deepen continue to beginning to third-party our see we We time. believe will incremental serve drive are with also impacts platforms needs, better programmatic relationship over that and to advertisers revenue

we about our still profitability. While to continue platform investment early, feel balance we revenue, grow in and growth will initiatives good and our to

turn it over our I'll to to Now discuss Dan results.

Anthony. Thanks,

XX% and We year-over-year. up streaming drive to strong hours with continue engagement growth

We streaming also X.X with per year from household streaming up per QX, X.X per ago hours grew hours account the engagement of period. in day globally hours in

we advertising, to both Within up In grew revenue distribution XX% driven QX, by revenue million, Platform total $XXX was services the political to primarily advertising early revenue, Streaming price from integration deeper with distribution outperformance subscription services impacts along increases. grew platform due than with Trade saw and year-over-year $X.XX XX% streaming we advertising, our overall from billion. net year-over-year faster positive activities. activities Desk.

retail year-over-year revenue by of expansion XX% Roku-branded distribution driven Device our of increased QX, in TVs.

was and increasing growing of markets, an currently while scale This ARPU $XX.XX year-over-year, flat XX-month reflects share a in XX% on up was revenue basis we focused of engagement. international streaming households year-over-year. on are trailing platform While

different is country at each Additionally, of monetization characteristics. each and stage has a economic different

up was gross restructuring was up year-over-year. of Total XXX gross basis platform up XX% year-over-year year-over-year. excluding profit When basis In charges, XXXX QX, points profit points XX% XXX was gross million, and $XXX XX% was year-over-year. gross XX% up QX margin margin of

Device negative which XX was down year-over-year. gross margin points was X%, basis

was gross basis XXXX year-over-year. year-over-year. total restructuring XXX margin gross basis margin gross Platform QX points basis down charges, points down XXX margin year-over-year points was down was XXX Excluding and device

adjusted was closed segment. better-than-expected We outlook. $XX $XXX million, which above trailing was our XX-month by on million flow primarily of significantly cash driven The $XXX credit and billion cash was Free our with quarter million a EBITDA QX Platform the ended facility. was basis. performance recently $X.X a

and continue free with see our quarter positive adjusted to model in our fifth operating cash leverage We straight of flow. EBITDA

gross adjusted to net million. of and turn me quarter. fourth gross $XX outlook $XXX for $X.XX the revenue margin with our total We EBITDA Let XX% of anticipate of of million billion, profit

anticipates outlook net total Our revenue increase. for a year-over-year XX%

QX platform XX% grow year-over-year device and expect revenue grew XX% year-over-year. to to We revenue

to between gross the be line and of half expect platform first XX% with in XX%, margin We XXXX.

gross and high in expect device promotional be in margin investment Roku the TV program unseasonal due teens We branded continued to negative the to spend.

in For we the prior operating year. in than sales be marketing expenses, seasonal expect XXXX more and to

X% expect up in result, be year-over-year we a to As OpEx QX.

OpEx marketing However, sales year, and will operational reflecting total slightly down discipline. the for ongoing be our full and

OpEx early a QX commitment achieve positive to year-over-year restructuring we exclude charges adjusted EBITDA XXXX, for onetime year growth from the made and XXXX rates expectations XXXX. for Our both full XXXX. In

be the to and cash EBITDA. Our free full line outlook implies EBITDA flow adjusted $XXX QX we adjusted year of in with for million expect

relentless continuing focus of while profitability structure team's the in our invest on experience of to cost improving level improving a simultaneously and This monetization. platform our is result streaming

and cash in confident continue driving our to platform ability growth. free are revenue flow We

questions. Operator? With take that, let's

[Operator will Instructions] Our be from Cory coming of JPMorgan. question Carpenter first

talk the KPIs and streaming households then platform beat a Wanted change your expand to follow-up, to as removing could drivers the ARPU? in in about could rationale the guide acceleration And of you the XQ? you for see if and relative the on and the

quarter, quarter. this had Anthony. Corey, we Yes, is a great strong

revenue. year-over-year. we're Our which with first quarter happy $X Platform revenue up in was billion very over XX%,

focused and platform that and our important showing focus profitability In growth us. been February terms in revenue priorities on drove in very results. on those, We are platform is revenue? of what for call -- said . QX we've And QX that

with terms of platforms, And third-party from been impacts some positive seeing the doing about that and we've but our we're well. early In talked Trade area, ongoing deepening which others. we've going of that that's Desk integration one, in and things before, we're

ways and We improving continue drive the UI can home to focus screen monetization. our on

home more stream is as a us, Our and innovating very for we're focused powerful on it asset as there using and well effectively.

home to X the quarters. in home example, brands For ad quarter. zone screen new a our lot sports our we non-M&E UI, the added including vertical spend last each of Ad on the of for categories grown has screen

demand ways we use additional growing our home the and on focused on we're screen. deepening to So focused add improving drive our third-party partnerships demand,

We're sign-ups that also zone many substantial highlight helped Roku our growing to in of Peacock subscriptions. focused subscribers. one first-time on a including Pay, volume through And QX drive is Olympic

also drive a also We subscriptions. that's and helping on new content our have screen row to recently, added home we that

revenue is strategy our platform and executing grow to focused We're working. we're So well. confident,

different generated household of our very platform profitability. majority us. In platform are markets, your growth your KPM a in are in and stages U.S., important in of is These the streaming terms economics. very growth is and but the different of or important most our international second monetization focused have our the now large Yet We're on for question our which of revenue on changes. portion revenue priorities currently

to representative achieve international as platform of for in to household growth households certain revenue we milestones. streaming updates we provide going grow is don't in and as on well the And these reasons, continue our We're as so U.S. markets growth. believe streaming multiple will scale

million XXX households months. we'll achieve streaming XX confident For example, I'm XX to the next in

Dan, do you want to add?

Cory. question, thanks Yes. the Thanks, Anthony, and for

add to Let me a the second just of your part little bit question.

and KPM. industry business streaming our grown the we and the evolved So established as households have a since

the our households. IPO, household XX than we just growth half we all We As an million now And representative as approaching million revenue streaming mentioned, more And XX growth. had households. in Anthony of of example, is are broadband the have of not at globally. platform streaming U.S., time

was And yet total XX% was at platform $XX.XX. up year-over-year, we see that flat when ARPU revenue

household broadband -- is a looking an ARPU and there. obscured X we as example as of households have countries, our Mexico looking metric. of how penetration So when not beyond fastest-growing of when significant streaming is

We're in in Mexico U.S. stages of are than the are quite different in the they markets and SVOD and ad Mexico in overall monetization the early

So this of being Mexico looking fraction when together blends streaming the all in it But currently a ARPU just households. results U.S. ARPU in in at the

time. platform remain cash as U.S. we letter, has growing hours, proxy the stated while And right a So over is And for flow, the total last streaming to due which adjusted experience. flat and several are quarters, KPMs we ARPU continued the engagement metrics revenue, for viewer been in to believe ARPU all these internationally. over both us committed then and households free mix EBITDA the streaming strongly and we of grow great to has

Cory, your services, performance more driven Platform To little distribution and a add question, in both profit by revenue driven our of advertising. to better-than-expected streaming and first bit by million QX revenue of was was Platform the both segment our gross primarily $XXX part

primarily challenged SSD increases. in to a also platform despite than M&E activities our subscription grew price market. faster revenue saw we meaningful this due increase But advertising sequential

due very the was our well as integration in we with of positive just very we're the from also some spend. performed impacts and Desk. Now political seeing to environment, political mentioned, And that deeper we Trade

be will our coming from And Justin Patterson Instructions] [Operator KeyBanc. question of next

last that been question, XXXX. talking accelerating about off you've into right. previously All Building growth

given the quarter the accelerate year, So momentum think should just growth about we just ability throughout exiting XXXX? this to you how each have

I OpEx. separately, wanted then to on And hit

are about growth the and total how of XXXX? Given and support marketing are sales thinking to slightly this right you into down year, level OpEx that investment

take that will Dan Justin, question.

question. Yes. the Thanks for

our exceeded expected, We in growth XXXX. guide the due growth of than platform to again, SSD revenue HX with So XXXX and in from expectations specifically in our price had stronger increases. has

XXX strong in seen also, have QX. adjustments. quarters, from did couple We've a in We spend political of contribution

guide acceleration revenue versus in QX, so QX our QX in we've QX seen platform implies versus And an similar a QX. acceleration in and

in rates increases We'll and quarter year. positive QX And political and QX again, during to from some next XXX certain it. in variables And may not given XXXX, It spend expect in quarters, guidance run the year. all accelerate optimistic comping and growth we QX we continue QX. while this SSD further just very about price I'm provide had like strong strong of in current in adjustments and

XXXX But into overall, good going we very on trajectory. our growth feel

in prepared for address Let me expenses year to But by remarks, OpEx. full expect projects, the ROI year, a impairment but talk I structure, highest question QX also this of team cost work do rightsizing in be on in operating briefly grow ongoing. and we excluding restructuring me as excluding expect tremendous projects to let charges. your we -- restructuring mentioned our my our including the job impact year-over-year, not highest on has done The and impairment focusing slightly this the OpEx charges. only in resources is down X%,

We evaluate capital allocation. continue to

add rates, do while some be in the likely FY OpEx in incremental So mostly I as growth some to our low-cost 'XX, I in locations, headcount I expect increase And increase modest. expect this the increase FY this guidance further an 'XX going we'll provide modest be get OpEx is But in expect in FY standpoint, and 'XX. progresses. a from to beyond. Again, leverage as we year to

question our And from will be Vasily next Karasyov Research. of Instructions] [Operator Cannonball coming

Wanted year, Charlie, different about question to ask, angle. a but next

out Trade a revenue-related advertising. home you for impact advertising positive partnership said providing already potential So these video major which with the initiatives, Desk, X of and screen the is the

us year? we do And track think a all, ramp next can you benefit them? of expect keep year how you them so next which First tell that could one can to of you be throughout bigger

is point, question. see we Desk the over we've to of and seeing Trade we growing of specifically share Trade are we signs the the the us very deal we and mentioned. the early wallet Desk, both types UIDX well, the advertisers many integration, And mid-August, partnerships as growing others. optimize learn to a third-party as It's the built serve. to good XX that Trade and your months. But with Starting a for is It's positive good. we're you impact the What grow Thanks began opportunity and of which last show our beginning question. we're in one there's of lot Desk number

address entire other as that to continue So and do Desk to also at move the forward. our with do we're We'll price represents integration but integrations expand going ability curve Trade points. the deepest well date, to serve multiple DSPs it demand to to more how

is Marquee, will we in really quarter. It this really receiving drive holds video which us think learn as video fourth that in our on currently beta, is the And in enormous the go the from I incremental stead over And quarters. an home clients. The revenue then GA good side, good opportunity. will screen it's reviews

home new to testing us monetize the see opportunities screen at looking new you time. the all and units And

television. stream Our positioning home market that the reaches about with the And has million innovation notion been being in our day. is U.S. whole every lead into XXX the screen households of home people

#X is of the the we're excited about that the advantage The Roku scale that on app we platform, channel our the have take data to opportunity. and fact and

other Some year. and we've that each of food, obviously, looking drive expand of off talked which calls about screen, as zones we then home are And price. we're sports past things will are on and those set Roku at, our home the well building sponsorable and next City, the demand opportunity are

is just couple Sorry, and Anthony. things. a I'll in jump this add of

for think are of all, first both opportunities us. big well, the On I programmatic, these

just their really getting we're screen. programmatic both well started, expansion home as as think I

if streaming platform ad something which the is on We're platform Roku a the we're wide that market mean to They United all think by and in in I you DSPs, very high want the #X integrate working about demand not earnest. is in our DSPs. the with world. by margin I mean, States, largest in

deepen a to business. relationships lot grow that there's opportunity those and of So

on we're and about food Charlie improve we both things zone for home advertisers. and getting then our done continue how a I monetization. can talked to user And some our zone comprehensively ads video we've ways at the of to looking There's But Marquee. started like also drive of our we in and mean, use the that, home can -- our screen just the for the our lot we sports screen. we're

of a So there's lot opportunity both areas. in these of

how quickly the the adjustment ask I was big in XXX can Dan, the Okay. quarter?

$XX It Yes. was million.

Laura And of our Needham. next be coming question will Martin from

connects a ad top-of-funnel is funnel purchases per television wondering solution Amazon And connected what primarily. for about has really television units. Two. is cost Roku who Connected thousand as moving full I'm to only

if wondering of television more their part you have per So set? thousand connected my one. performance-based of alternatives I'm are first as as other cost a direct pressure product seeing alternative That's

is The second generative one AI.

here, about set? today small into medium think your to intriguing AI are self-service in generative conversions your You businesses. have And are up? is offering integrating is, My talking how you're -- get you and the question which for I AI product you self-service generative using

Laura, you. hear Good to this is from Anthony.

funnel focused we a things connected do of So on I guess a that the I couple not. mean, performance-based as of as top all, focus first of lot full TV on of move as advertisers are well on well. versus funnel have we products

the it's it's funnel demand. product on time lot So map terms we in addressing -- a our not working an ad of that spend entire ad road of of area

distribution are CPMs, stream advertising. a and important not market-driven services more we because streaming service is diversified we're about streaming revenue I a changes streaming the But thing and business platform, think that have impacted we're our by across in way pricing very other the

but We sponsorships are ad platform. a we have set that the have unique and traditional possible products also video and own we because app, of UI only of course,

of portfolio. We our TV. screen well Roku as also assets most ad the as why have are performance-based a course, ad that one The our an lot of into home lead platform are is, we is and of products in important

screen home before including their the watch watch, more to than Every only households were they're XXX million experience what to and Roku ad-free start with streaming decide they apps. people reaches going day, people U.S. it those,

a those to So our reach ad for customers. only of a is the Roku lot customers, way

products. and then, including to products our on -- in performance-based focus course, we're ad continuing UI, We of new can creating

We grow. that's to a well positioned ad business great have

we add AI? anything generative before Charlie, go to do then you to And want

currently Thank assets an a way a not app, be lot doesn't we're It Sure. fact assets. same services. is of Laura, impact supply. streaming just market CTV true, we're it great question. you. it's as linear we're not the mentioned, it platform, has And and that individual apps bundling Anthony will The a with the Roku

a make difference. all These

oversupply have environment to this inherent in the lessen advantages Laura just to impact from pricing really we allow grow fluctuations. because have benefit that absorb and us but of We scale not the also market

We earlier, for Roku want of and And and effective like not an us pricing. home and City, individual makes unique and you all the assets way as to screen advertisers. original And programming drive mentioned services partner take... same have other apps. that just create sports assets extremely Do that demand again, just we're I affected and streaming

generative cost technology about also across this about drive and way that with could the Roku could our of on AI ad we obviously, particularly us harder -- platform, looking a effective. interacts a Self-service be -- platform basis you at. we're that a small medium-sized recently revenue business the on want is X I also manager, is just areas is of which And businesses. Anthony, we're then use ways AI integrate and looking is and already. again. one We launched mean, ways generative the we self-service self-serve asked advertisers looking AI, to We're in Obviously, targeting

that the those to today, make huge kinds for I high-quality -- to television-based way start easy opportunity for easily and a view same of ad they a as as example. businesses to an word deliver do can And generate ad, it those

for us. something clearly And that's yes, it's big we're so And on. focused a opportunity

sold Laura. their advantage throw is ads seeing it. ramps of in of on manager taking I'll ads interactivity. Thanks, portion really just significant a ads thing in action top manager X that are we're of What the

revenue about talking for So are meet demonstration of we we've it now diversification our a your great a start. solid of our diversification demand to technology needs IO and the preferred is -- the really off building it's We platform And of from direct advertiser. been DSD through quarters. to because all or focused is really strategy on is a growth question to self-service, demand last few

of next [Operator be question Instructions] will of Our from Ruplu Bhattacharya America. coming Bank

X. have I

First Charlie. one for

you've with unsold And X.X. demand integrated and UID uptick the I'm at willing would asking price seen in TTD talked integrated curve third-party fill serve to you be about letter ability an of the you've because DSPs. to So inventory Roku's Have multiple entire points. Roku's rates? What you portion also shareholder allocate that

So do you CPM? Charlie, have on guardrail what

appreciate I question. Ruplu. Thanks, the

third-party of As at at is heart which UIDX, no the across opportunities all I and Trade degradation, but with -- in and the look correlation said I your at And also the margin DSP of I before, our Desk see relationships. question.

And an programmatic is again, think us management and and a margin Inventory strength. for that opportunity degradation. asked value And and CPMs And have is for type. way have home across about sports vary deal price by we it. opportunities a not the advertisers that screening opportunities we does original higher for you chain you margins and programming. about. mean They on good to

open are obviously, down that to on then comes But will channel unique I and partners the am our be fewer chain. And both programmatic, the fewer signals price bullish data of on price. integrations, lower all that our ability up with and this, those fewer sponsorships

just not it's it's the partners. DSPs, And our the SSPs, it's measurement

We third-party note Roku you'll lot on have channel. about XX% in of that out. we're then we're building we growth hours driving talked that a And relationships the

growth and which opportunity enough and enough inventory these pretty do is our unique deploy to value to chain that demand Roku with so we across have And so. because the to advantages all

DSPs distinguishes mean don't it degradation. Roku believe just say margin this I market, I'll in again, So and

I'll this: our asset it's mean, on Channel us. Roku hours XX% just mentioned, incredible was And an year-over-year. quarter. straight I grew we for for third the Charlie like the #X The add app platform

Okay.

for investment you follow-up of XX areas next Can your over a the maybe Just Dan. prioritize months.

and help you or programmatic that? expansion. thinking about content rank on original are Can international spending you us on how spending So order

that. color some provide can I Yes. on

monetization amongst So very deeper examples our go of for and asset, very quarters, integration do most on Desk specific a fully with distributed We've of And investments of other platform people, we've DSPs. our DSPs being focused and monetization. our side. in lot allocation given said into several of we're we're Trade a lot making the our changes important

we're given the video and our on. row subscription the Charlie in through talked we're working Pay. on that subscriptions mentioned about on of the other using examples our continuing more we content improving and how to if assets to focusing screen products focus changes the investment We've our will, you ad original drive platform through to We've subscriptions that journey, have home marquee Roku we're

in monetization. launch subscriptions, platform We to opportunities in premium to also that our lots to investing There's soon. have focusing which about going more hear scale on grow of you'll continuing where there. and international We're are we're drive

on well doing international. We're

in in an invest monetize question, engagement. earlier continue that mentioned I and build will international because As scale we to we'll as ultimately,

terms are the very on those areas So focused we're in where of monetization.

original do is fixed or have On that if vast content, I'll everybody We variable not based question, based, license original the majority that in will, the cost is you of have Channel content fixed. content. Roku in is remind variable the just share. much We do of on but a rev the content,

terms So structure of for us to because in overall content significant original it, investment not a within we will while it's absolutely streamers in continue portion our content the our this of love cost material Channel. and Roku a cost, invest isn't

are XXXX, earlier. rates but with -- reiterate about I we're all ongoing. going these OpEx said earlier. into our And just talked modest lot of investments lastly, continue I'll do that what so They'll A I growth to

Our . next Citi. Bazinet coming be question Jason from of will

I a question. just strategic had

And the it's said devices. really doing #X, You according the well, distributing channel at app gauge but ever from on on the your Have think, thought you the Roku Nielsen. Roku not is to about devices Roku least aren't I it's devices? data that #X Channel,

this Jason, Anthony. is Yes.

the on we more content, our reason content which out because watch a which to a lot our the which we commodity-based content. be primary as what viewers influence help on features is our building to in Roku of is app find the area time to watch. of AVOD it And the but platform, is that lot tends lead position spend television, Channel, is have that -- an is So where elaborate, obviously #X viewers

so huge a good it's #X position on build awesome licensed available, to selection want has hours and that to business a our lead and app. of and of has viewers channel us But they what generally has watch into Roku might a making television that to the readily that's number content. to lot as allowed got recommendations content,

looked overall amongst have you all is off XX it's on a available available a available various economical -- platform. We when example, it but is look apps. and TV, on actually It's just It's Amazon But business, -- platform on Samsung. on Fire if a it app more top at for much it's It's Roku. profitable our the much versus economics that more of third-party platforms. and

guys I can rolling maybe you newer just the every say, there that device single these you're the Roku handle out gets to channel, on Roku that make like, And When is some that sort in a devices? really that ask let's that's refreshed field? innovations Sports Or innovations if of are something follow-up. devices old can't

all a Yes. mean running great put about the -- but amount tremendous it in release. effort don't software we talk put the question. keeping same I version in a that's we same field. of the We devices in a much,

same there, run Roku then device features be same have exceptions generally, small and few here devices all version old -- the like essentially there but very very and by all devices, the region. a So and few software might all

Mexico, different be in So vary it like than it U.S. say, might the region, might by

of will Research. question Peter from Wolfe be next Our coming Supino

revenue Wanted a And may. to we this heard your on you ask your question you I outlook on commentary trying growth. I'm about XXXX. sorry duplicates expand for ask but again earlier, to to if Two, if

expect was accelerating think prepared QX. a commentary the has to QX the been again in accelerate in and you business in that I remarks there it

And for why gross the if in your 'XX and growth I'm wondering whether 'XX? outlook that talk the are than And about just another as different margins, in puts topic, XXXX XXXX. I release in takes you press existed any that in outlook those have could then wondered on

that. take will Dan Peter,

Yes.

that said say do on strong I growth, we be -- XX% QX, the even while next to go QX what what said the about expect expect said is platform we was was So we And as would QX. earlier gave so was obviously, guide off far in clear, in what growth. to because acceleration I and year we of we

The question was just HX get and the of political, on need see where comps looks that. need from to can that we on year in later runway especially just some in acceleration -- we to have like from I the current that we comment get, before

QX into second I'm guide So full-on our giving I will we'll run from growth good it very accelerate not just different margin feel about in XX%, looking platform which we year. And of will at current the had QX and outlook different to takes to this in if rates. puts beyond say as from going the be between this so XXXX, we is XXX implies provide gross some QX, platform year. And more question on as comp political I updates said, these I Again, into feel we margin, have on QX. potential adjustments and I of the for then line of with rates. -- But about QX some mentioned, growth like and XX% are get XXXX. into and HX gross good through growing activities we very specifically that our our just as issues

have will mix an margin. on So impact

done become M&E. of For will negatively offset to overall very stated platform several good margins, M&E job smaller believe we impact also we've a of be the advertising our revenue have brand will This which we going percent example, challenged optimizing platform forward. has as and largely margins, but will a impact times, of our continue mix

the 'XX, into think my to and as going FY I expectation relatively so -- XXXX, number expect, margins I if that's consistent with go with will So our around XX%, of we just 'XX. is impact would XXX, you that be exclude

with ex basis on side platform think as M&E any an us impact. on So mix able being about to offset margins flat XXX it the

[Operator be Instructions] will Wells of Our next question Steven coming Cahall from Fargo.

finer try just to to it. point on put First, a

conservatism? political that or the is understand that just just that in in M&E sure QX So to comp understand make the Is tougher? platform the or you us deceleration the lumpy quarter-on-quarter that's help So what's we a little driving slight the Is growth? one, or QX XXX first was Olympics can the revenue just deceleration.

then home video, so think I it's you're the somewhere in brand about testing. in beta And I we into think potentially were know expanding a advertising. as is secondly, where you're Dan, whole, investing and screen speaking M&E If about just which you

will in So comp to grow is think non-M&E more screen revenue, the and the home if there? that future the M&E or we between a is pretty of little kind start you still that think about still tough holistically something

Yes. slight that's the again, going question XX% first your to XX%. decel, To so on

I question standpoint, QX, And we only be in again, And month think strong. remind political just October. expect and everybody QX a X QX really political. that a while there's also you're that very I'll it's the from of that's had strong asking. to we political

had was also, We mentioned $XX again, million. QX, XXX just in which I a adjustment

context. So a of of sort that not decel again, kind QX like to it's if in you do apples-to-apples of QX, a comparison really

offset M&E, growing think pace screen, with is the To in the advertising, not spend Charlie and strong. of home brand I as question is will overall ads just up. second unit but will which marquee growth our that Yes, on video grow M&E do our mentioned, picking exceptionally keep

the year-over-year and QX. so sequential in grow from change And really growth advertising a QX up in on both a we've step able to to been activities

growing not challenges brand continue. close And expect M&E our again, that and to anywhere M&E to ads. these we Despite

other ads that continue part growing essentially, a integration of screen think home home But like just the Desk sequentially. a the ad we've a overall, to home of our brand able the with screen lot Also through we'll Trade and that. So do screen is to growth on grow big And our think again, products. I monetize will continue. is been holistically like one whole, of reasons which why as our that we

And this is Anthony.

add. Let me just

making influential screen on Our of monetize watch ads homes ways screen. on also is lots more focused we viewers just focused It's and home on in the the there's what on not work the viewing. that home be our

adding been subscription the services role subscription the So our on drivers for home how screen. example, talked of we to has of about one recommendation revenue our

have activities home been including that there's screen, which different monetization drive in the haven't bunch some expect some working still advertising. So we're of yet, a lot out, areas, will and of just on we rolled released of a around

far thing advertising, added ads the them on working advertising a video home specifically, those lot the related screen, screen, so video well. we're only done home the other And as home but is are we've ads screen that on to of there's in we've non-M&E now. And the areas on to

So as advertising happening brand lot there's of a there that's well.

from Jason coming Our next Instructions] Oppenheimer. of question Helfstein [Operator is

This is for on [indiscernible] Jason.

about just on year views growth? that question year? target we next margin So OpEx a or should How a think next on for

out and I down Again, when X%, from the back impairment specific continue for the year slightly mentioned prior OpEx of Yes. I believe the you far, expect total to number we be year. was restructuring that rest and down. was that earlier so to

to We'll right in while that we our talking expect more is not in likely level believe the now. For amount forward. very going right although next provide OpEx, is be grow digits think mid-single guidance level, But a I OpEx that all guiding to -- that this high we year, invest some increase I'm what mentioned these I about But have initiatives at to I that we've for throughout OpEx us. modestly modest. do will we continuing call. been probably again, can

So I do significant OpEx. step-up in modest. expect It not will a be

Our will McVeigh next Cameron be of from coming Instructions] [Operator question Stanley. Morgan

exposed or streaming over is X past we've recent the seen services the are certain you price or on the driving Disney, more some impact Max curious if streaming Paramount outsized I Plus, services year? increases was whether and distribution given revenue an to less of Peacock like

we're distributor a services. the large for very I all mean streaming

fairly a share than streaming business out. one across that's particular area obviously, So services. others, some diversified there's but the different streaming I'd no call market more services have mean, I

trending curious and Got bit the there's plans then biggest it. if a country? could whether given talk the just secondly, opportunity about one how that's I And was more in international you and expansion

over some that. comments to is more and This Dan I'll Anthony. turn on Yes. I'll then start it for

So going is our international expansion well.

or good stages fairly account set on monetization, And basically the And We different plus making call monetization. of a of countries focused countries we're but active in U.K. those all are they're countries have the early fairly growth. those progress what internationally in countries, we of streaming Americas on all all focus in we're it's household constrained in

We of primarily platform those in households the we're still focus streaming in scale countries. we're of we're Obviously, all and of the So in U.S., countries. growing strong the focused streaming platform Canada. our on in growth the #X #X mentioned with Mexico. in #X We're

you Dan, add anything? want But did to

Anthony international at monetization. add are of different as just scale I'll different mentioned, that, stages and markets

we really monetization. starting Mexico to have As scale in I focus on and mentioned, we're

have And Mexico. growth expect rates again, started. we're very just so getting to But we in strong

small. relatively monetization seeing in meaningful is base We're the So also Canada.

and X meaningful we're mentioned, OS. still the areas growing are #X streaming monetization, TV we're do scale households the but selling just engagement. building But and Anthony just have countries other yet are where These not

U.K., still think So follow. Brazil and of monetization building rest Latin of when the even really we're and America, in you and engagement scale that will

is to meaningful we countries streaming million to time, grow international of said times, XX ultimately as build we're be But which couple platform we'll monetization. a monetization XXX does we I drive we to And expect we've us engagement, And it of well. in over scale, for our a to these net all the again, revenue. to time is And continue think take with that in need monetize what scale expect international to So months. and households XX more our going next markets. it percent to achieve

markets that U.S. in the international we're XX we're XXX assuming is next Anthony. households million growing that markets XX add to in all in, streaming forecast the months, This and all just we're of on I'll

streaming the We all households be those expect of to markets. future growing foreseeable in for

will coming be [Operator next question Capital. Instructions] Our of from Gould Alan Loop

I've X questions. got

TV if Roku-branded they was new impact, TVs TVs? on what Anthony is side, I just Series how give sense the whomever, partner of York for is for on Roku First, any, And market had could -- some is now? Charlie, now how looking us the your you Pro hardware year branded the a or have how is wondering then ad if your doing? And plus-or-so, right if you've had

-- and TV can Mustafa then TV -- off, So that start Roku-branded can yes, kick answer the Charlie question. Roku

quarter, accelerated outperformed Great. the across third Thanks, from said quarter the of as activities in year-on-year advertising Alan. market second Look, the activities the nicely. third quarter Roku both and advertising ad earlier, ad the In OTT market growth the platform, overall U.S. excluding M&E, Dan

really good feel that. we about So

in be times, that categories, a M&A year-on-year of third the inside the pressured a verticals, specific more on wellness. Roku extra and little few we've of Those couple health little political, ad retail context. and quarter, they are verticals a up little To continue you platform, a a growth a baseball to as give CPG few were mentioned and

in ad The early. biggest XX-week process been and this sales observing for really certainly, the you've probably change were that the in us. it market-wide upfronts market, we now is closed positive market, market a is And relatively

However, the on basis. into in out and of and levels upfront are with our week-to-week visibility. varied such right come an a of environment working working jump partners marketers We day-to-day where even with short-term

like in good growth really because all that objectives the So from long. it's in all stead Roku and advertiser year mentioned all changes I I allocations market brand last the characteristics we're meeting And think focused to then the the upfront hold that on the of and answer.

want to... Mustafa, do you

the TVs. being are Mustafa we over this launched was journey, Look, still the of year that. in done very progress products overall, on Yes, these speaking. sure. for is a with We're these little and we've TVs, And stages which we this ago. our early a initial our distributed Alan, focus fully Roku-branded of pleased

many calendar We and will the which products. year have to grown we from grow national for and these space retailers. continue distribution now shelf Best X regional also retailer, Buy the exclusive the And for to was 'XX, now

And and with positive we reviews great respect technical receive continue feedback again, to press. from the users to from and the products, ratings

the X the Pro have Plus lineups which products and products. series, series, more our entry-level performance We product range Select series, now the is our and sort the midrange

been Plus less really compared a well. doing Plus all show to are that our receiving really, and especially the Pro It really lineup. But Halo good feedback. product can series and has to it our product. technology series is are But overall, They They capabilities. complements higher-end we Select series. sell tends

doing again, well. And really

performance have actually branded picture reviews. we pleased quality, video our develop terms And we of are other in We design great Roku TVs, very of the with the the the share whatever and product features partners. our that we and with for

benefit that these partners developments we our technology from have. licensing So

own our We and they reuse to purposes. their take completely underlying are them, almost can open then almost for hardware --

So that of we are level. kind open at

And so it's working well.

products developing So their whatever as we're contributing is to we're learning, whatever well.

program. our our and has And relationship bring new continue to been to so Roku growing far, partners, with we our TV partners

that So also is system overall, the particularly our direction. right third-party should U.S., the and in And our partners our players. main it's with streaming note all operating of moving distribution the TV I also in through

and Roku markets. will Our small we then our on on and other for TVs distribution continue the U.S. U.S., the third-party in available in a in the main the system the Roku-branded sure in and of expect we overall really operating only of be still rely to are brand also to this portion TVs markets that this international rely get way. our U.S. distributor in the are partners really not the because We

will Mark be Instructions] Evercore [Operator Mahaney ISI. of Our coming next it from question,

Peterson is for Mark. This questions, may. Ian on if I Two

did how First question, in about from a political think how political contribution much revenue ad contribution And the should see we in QX? of we QX?

should saw saw year. to video to in in the for last on strikes in color And comps QX a in of auto QX there revenue guide, headwind platform related increases guide we verticals is advertising secondly, SSD the much from the M&E the easier And the year? subscription we price expect QX secondly, ad of any last related we how and

that. take will Dan

Yes.

was talk just attack it it our came Political amazing the job, did all strategic like at advertisers, is answer an demonstrating to tools better The we're It's another impact in noting that political make expectations of But that getting political. specifically, your Let political. question team also vertical an that and briefly is that above monetizing me about on cycle. Roku Roku QX. and every QX. a platform for has worth including several in

going note But month impact for of of into X factored in have is much did month We're versus that, QX. It the X an October It political was. is QX. to not course, it QX. say months how QX, strong our in guide on only

is And guide. into factored our again, this all

as of terms just QX In a headwind SSD the would your such not think headwind I in as question per guide, se. it of on

our -- price in increases we partners. many this of year throughout subscription Our did have

benefiting in are QX adjustments about we from so that. And has caused what We XXX and QX. talked That that. is the

into a of SSD think I QX. going So specifically there's headwind terms in don't

at ex do our Desk with think Trade want just brand has M&E our very to integration and advertising that to due due continued -- a reiterate accelerate that other ad to I DSPs. to I healthy innovative clip product

we there. what like we So see

the of part ad last should we if M&E of easier terms comps strikes. expect question, the In from your from

faces. a given decide easier we the industry don't to and M&E or just the think spend. I due to comps if And in content partners whether to any from that ad great M&E, are M&E Yes, an easy position the ever just comp it's -- challenges benefit is

we've so able advertising And to far. activities and the our M&E. not seen from However, grow despite our overall that's we've platform challenges what been

I from the don't So you environment. know, M&E again, add anything really we to about in forward that feel have Charlie, to M&E standpoint? good even challenged our path this if

Roku worth look, reach, team best Dan our M&E us on to when holds away be the and of on think relying right, build place to is innovation And good is beyond, from see M&E for a job. I in and the a engagement and doing build and both that partners is benefits continue for saying the Well, but categories of position diversification is future it's not we're lot screen healthy. great vertical growth, home M&E a this will to to ROI. the

CEO, to back now call remarks. like the Okay. closing turn would Anthony And to I Wood, for

I'd and our and joining like our employees, call advertisers to today. partners, content for thank you thank

conference today's be and their for you will participating. This posted concludes remarks site. concludes posted prepared has replay conference Roku today's their call. IR call. on the This Thank

disconnect. now may You