Q2 FY2026
Filed Aug 6, 2026Roku reported Q2 2026 total net revenue of $1.35 billion, up 22% YoY, with net income of $164 million and Adjusted EBITDA of $254 million, both described as record highs.
Platform revenue grew 25% YoY, total gross profit rose 35% YoY, total gross margin expanded 4.9 points YoY to 49.7%, and net income increased to $164.2 million. Advertising and subscriptions both grew more than 25% YoY, while Devices returned to positive gross profit aided by an IEEPA refund.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total net revenueGAAP | $1.35 billion | – | 22% |
| Platform revenueGAAP | $1.22 billion | – | 25% |
| Devices revenueGAAP | $134 million | – | (1)% |
| Total gross profitGAAP | $674 million | – | 35% |
| Platform gross profitGAAP | $646.8 million | – | 30% |
| Devices gross profit (loss)GAAP | $26.9 million | – | nm |
| Total gross marginGAAP | 49.7% | – | 4.9 pts |
| Platform gross marginGAAP | 53.0% | – | 2.0 pts |
| Devices gross marginGAAP | 20.1% | – | 20.1 pts |
| Research and developmentGAAP | $179.7 million | – | 1% |
| Sales and marketingGAAP | $223.2 million | – | (8)% |
| General and administrativeGAAP | $124.6 million | – | 25% |
| Total operating expensesGAAP | $527.5 million | – | 1% |
| Income (loss) from operationsGAAP | $146.2 million | – | nm |
| Net income (loss)GAAP | $164.2 million | – | 1464% |
| Adjusted EBITDAnon-GAAP | $254.3 million | – | 225% |
| Adjusted EBITDA marginnon-GAAP | 18.8% | – | 11.7 pts |
| Cash flow from operations (TTM)GAAP | $719.0 million | – | 81% |
| Free cash flow (TTM)other | $704.1 million | – | 80% |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| AdvertisingAdvertising growth was driven primarily by a mix shift toward higher-margin ad products. Third-party DSPs accounted for nearly three-quarters of in-stream video ad spend on the platform. | $673 million | – | 25% |
| SubscriptionsSports viewing, Premium Subscriptions launches and the World Cup contributed to growth. The Soccer Zone drove hundreds of thousands of sign-ups in Q2. | $548 million | – | 26% |
| PlatformMeaningful contributions from both Advertising and Subscriptions supported growth. | $1.22 billion | – | 25% |
| DevicesDevices gross margin benefited from an IEEPA refund for tariff payments paid in Q2 2025 through Q1 2026. | $134 million | – | (1)% |
What drove it
- Streaming Hours were 37.9 billion, up 7% YoY.
- The Roku Channel was the #2 app on the platform by engagement in the U.S. and achieved a platform best share of TV viewing on Nielsen's The Gauge™ for May.
- Advertising gross margin was 62.4%, up approximately 190 basis points QoQ and 650 basis points YoY, driven primarily by a mix shift toward higher-margin ad products.
- Political advertising in Q2 exceeded the comparable quarter from the 2024 U.S. presidential election cycle.
- Roku completed the U.S. rollout of its new Home Screen early in the third quarter; the company said results were encouraging and that it improved its ability to retain households in the U.S.
- Roku-made TVs represented approximately 5% of total TV unit sales volume in the U.S. in Q2.
Concerns
- Subscriptions gross margin was 41.4%, down roughly 360 basis points YoY, with the largest factor being a mix shift toward Premium Subscriptions.
- Devices revenue was down 1% YoY.
- Devices gross margin of 20.1% benefited from an IEEPA refund. Excluding the refund, Q2 Devices gross margin would have been (7.6%).
- General and administrative expense was up 25% YoY.
- Political ad spend is weighted toward the back half of the year, building through late Q3 and into Q4 ahead of Election Day.
What to watch
- International rollout of the new Roku Home Screen in the coming months.
- Expansion of AI-powered search, which Roku expects can support subscription conversion and retention, monetizable Streaming Hours, and advertising and merchandising performance.
- The duration of political advertising momentum through the 2026 election cycle.
- Smartly, which is expected to add incremental performance revenue by early 2027.
- Further DVR feature rollouts within Premium Subscriptions in the coming months.
- Devices gross margin excluding the IEEPA refund.
Balance sheet and cash flow
- Cash flow from operations (TTM) was $719.0 million, up 81% YoY.
- Free cash flow (TTM) was $704.1 million, up 80% YoY.
- Excluding the IEEPA refund, Free Cash Flow would have been $242 million.
Analysis
Roku delivered broad Q2 growth, with total net revenue of $1.35 billion, up 22% YoY, led by 25% Platform revenue growth to $1.22 billion. Advertising revenue rose 25% YoY to $673 million and Subscriptions revenue increased 26% YoY to $548 million. Streaming Hours reached 37.9 billion, up 7% YoY, while the company highlighted the Roku Channel's #2 engagement ranking in the U.S. and a platform-best share of TV viewing on Nielsen's The Gauge™ for May.
Profitability expanded materially. Total gross profit increased 35% YoY to $674 million and total gross margin reached 49.7%, up 4.9 points YoY. Platform gross margin increased to 53.0%, with advertising gross margin reaching 62.4%, supported by a mix shift toward higher-margin ad products. Operating expenses increased only 1% YoY to $527.5 million, which coincided with income from operations of $146.2 million and net income of $164.2 million, compared with $10.5 million of net income in Q2 2025.
Advertising mix and programmatic execution were central operating themes. Third-party DSPs accounted for nearly three-quarters of in-stream video ad spend, and Roku said political advertising exceeded the comparable Q2 of the 2024 U.S. presidential election cycle. The company also cited strength in Media & Entertainment and stated that non-M&E clients represented more than a third of total Roku Experience advertising revenue. Subscription growth was supported by sports viewing and World Cup-related acquisition, but the Premium Subscriptions mix reduced subscription gross margin by roughly 360 basis points YoY to 41.4%.
Devices was the principal qualification to the reported margin expansion. Devices revenue fell 1% YoY to $134 million, while Devices gross margin turned positive to 20.1% because of an IEEPA refund. Roku stated that, excluding this refund, Devices gross margin would have been (7.6%), net income would have been $127 million, and Free Cash Flow would have been $242 million. The company nevertheless reported that Roku-made TVs represented approximately 5% of total U.S. TV unit sales volume in Q2.
Cash generation strengthened on a trailing-twelve-month basis, with cash flow from operations of $719.0 million and Free Cash Flow of $704.1 million, up 81% and 80% YoY, respectively. The company described net income, Adjusted EBITDA of $254 million, and Free Cash Flow of $704 million as record highs and reiterated a path of sustaining double-digit Platform revenue growth, expanding margins, and growing Free Cash Flow per share. No numerical forward outlook was included in the provided filing text.
Not in the filing
stated, not guessed- Period-end date
- GAAP diluted EPS
- Non-GAAP diluted EPS
- GAAP net income margin
- Cash balance
- Debt balance
- Capital return activity, including share repurchases and dividends
- Numerical forward guidance for revenue, gross margin, operating expenses, tax rate, or other metrics
- Prior outlook for comparison
- Named executive quotes
- Full filing text beyond the provided excerpt, including any additional financial statements, reconciliations, guidance, or CFO commentary
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.