Rise

How Roku quietly became the #1 king for cord-cutters

Snacks / Friday, August 09, 2019

Rudy...Rudy...Rudy... The streaming company that turns dumb TVs into smart TVs with its HDMI dongle and software just announced 2nd quarter earnings. And Roku's stock surged 21% on a made-for-TV trifecta of growth stories:

  • +39%: The # of active Roku accounts is up from last year.
  • +72%: The increase in time users spent Roku-ing with their dongle or Roku-equipped smart TV compared to the same time in 2018.
  • +59%: The amount of money Roku made last quarter, compared to the year before.

It was already varsity. Now it's the QB... Roku just hit some big milestones that show how the tech company controls cord-cutters' binging time. All that netflixing America loves — it happens via Roku more than anything else.

  1. Roku's the #1 streaming stick with a 39% share of the market. Amazon, Apple, and Google are 2-3-4.
  2. Roku's the #1 smart-TV software with a 33% share of the market. Samsung, Vizio, and LG are 2-3-4.

Its tininess was its advantage... Put all of Roku's stock in a sack and it's worth just under $14B (that's also called its market cap). That's like 2% as big as the tech giants it competes against. Its size helped it avoid the rumbling of its bigger tech rivals:

  • YouTube was blocked from Amazon's Fire Stick. Amazon Prime Video wasn't available on Apple TV or Google Chromecast.
  • Walmart refuses to sell Amazon devices (for obvious reasons).
  • Meanwhile, Roku's stock has quadrupled in the past 9 months.
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