Roku

October is off to a strong start for Roku (ROKU 1.13%) investors. Shares of the streaming video pioneer are trading north of $100 for the third consecutive day on Tuesday. It’s a familiar but unfortunately fleeting experience.

Roku has proven mortal since the initial pandemic feeding frenzy sent the shares to an all-time high of $490 in early 2021. The shares would go on to pull back dramatically, but it hasn’t dimmed the fight. This is the fourth year in a row that Roku revisits trading in the triple digits. It has failed to stay there at the end of the last three years.

It could be different this time. Momentum is on its side, but will the company stick the landing in 2025? Let’s take a closer look at how Roku is doing, and why the latest dalliance above $100 can have staying power this time.

This is why we can’t have nice things

The inability to enjoy the good times isn’t limited to the stock’s short-lived tenure in the triple digits. Roku has now moved lower the day after posting financial results in four of the last five quarters. It happened last time out, even with Roku beating expectations on both ends of the income statement, raising its guidance, and delivering its first quarterly profit in more than three years.

Roku was checking most of the boxes that growth stock investors like to see, even before what should’ve been a transformational second quarter this summer. Revenue growth has been in the double digits for more than two years. It’s been generating nine-figure trailing free cash flow for almost as long.

The lack of positive earnings was holding Roku back, but that headwind is now a tailwind. Analysts see the bottom-line gains improving exponentially through the second half of this year and beyond.

What are the other knocks on Roku now that the red ink has been wiped clean? Naysayers argue that Roku is in a cutthroat market, competing with three of the world’s most valuable companies with far greater financial resources. How is that playing out?

Like the other leading streaming services stocks, Roku is no longer publishing its active user count or its average revenue per user. It’s still putting out usage metrics. Streaming hours on the platform have soared 17% over the past year.

Like the other consumer tech titans in this space, Roku sells its hardware at a loss, but gross margin was surprisingly flat in its latest quarter. More importantly, since its high-margin platform revenue now accounts for 88% of its revenue, it’s OK to treat its devices business as a loss leader.

Image source: Getty Images.

The narrative is changing

Roku shares keep climbing the wall of worry. The stock has risen nearly 40% over the past year, even with the initially negative reactions to its financial updates. Reality is beating the knee-jerk reactions.

Roku hasn’t just landed ahead of analyst profit targets over the past year — it has demolished them. Roku’s positive bottom-line surprises have been 25% to 144% better than Wall Street targets. It’s using its scalability and desirable audience to its advantage, forging partnerships that will enhance its already strong position in the connected TV adverting market.

All the storm clouds aren’t gone. Even the connected TV ad market will take a hit if the economy heads south. Its rivals with market caps in the trillions can decide to throw even more money at their fledgling streaming operating systems. It will take a couple more years of expanding profitability before Roku has a reasonable P/E ratio.

Roku will be just fine. With its healthy run of “beat and raise” quarterly performances mowing down the worrywarts, 2025 should be far different from 2022, 2023, and 2024. There is more than just something good to watch on TV. Roku has cracked the code, and now it’s the one that can go afford to go channel surfing from the couch.

The Savannah Bananas, the team that went viral playing a hilarious brand of baseball, are coming this Sunday to a streamer near you.

Could there be a more exciting Fourth of July weekend, America? No. No, there could not be.

Sunday at 12:30 p.m. local time, 3:30 p.m. Eastern, the Bananas have a rematch against the Firefighters, the team they played at Anaheim Stadium at the end of May. That game will go down at Boston’s Fenway Park, home of the Red Sox, and will be streamed live on the Roku Channel.

“We can’t wait to bring the fast-paced game of Banana Ball to new fans all over the country on Roku!” Savannah Bananas owner Jesse Cole said in a news release. “And you better believe that we’ve got some surprises in store for Fenway!”

Guess there’s little or no reason, except maybe having no internet access, to wait until the CW does its own broadcast of the Bananas playing the Texas Tailgaters on July 27 at Citizens Bank Park in Philadelphia.

“Banana Ball” — for those who don’t have TikTok, Instagram, Facebook Reels, X or any Bananas-loving real-world friends — incorporates humor, gymnastics, lip-syncs and snappy dance choreography in an exhibition baseball game with rules that definitely don’t match those of Major League Baseball (though many of the players once had MLB aspirations).

The Savannah Bananas, a minor league baseball club, went on their first ever “World Tour” this year, taking their unique brand of baseball to various cities across America.

Only the Bananas deliver baby races, a dancing umpire and backflips before balls are caught in the outfield. Can’t get that in Oklahoma City. Plus the games are limited to two hours max, something even the much-loved MLB pitch clock can’t deliver.

This year, the team has sold out 18 major league ballparks, plus three football stadiums with capacities of more than 70,000.

Tickets typically are available only through a lottery — and last time we checked the wait-list for that lottery, it was more than 3 million names long. Try to join it now and the Bananas website will tell you sure, go ahead, but be prepared to hold your horses till next season, my friend. Last season’s games drew a million fans total.

“There is truly no sports experience with the same action as a Savannah Bananas game,” said Joe Franzetta, the head of Roku Media’s sports division, in the news release. “We look forward to using the power of our platform to amplify the game directly to both die-hard audiences and millions of new fans about to discover something special.”

As owner Cole told The Times back in 2022, “We’ve always been very clear about our goal. We exist to make baseball fun.”

Folks with a Roku TV or who stream through a Roku device should be good to go for Sunday’s free broadcast. The Roku Channel can also be accessed online at TheRokuChannel.com and on iOS and Android devices and various and sundry smart TVs.

And remember to set your DVR to record the CW on July 27.

Former Times reporting fellow Anthony De Leon contributed to this report.

FREEVIEW’S successor will appear on even more screens after landing a deal with one of the world’s biggest TV brands.

Freely, made from the same company as Freeview, is encouraging viewers away from the humble TV aerial to using Wi-Fi instead.

2

This means you don’t need to worry about pesky signal issues – nor having to place your telly near the aerial port in the wall.

For the moment, the service is hybrid so it can take Freeview channels the traditional way as well as via broadband.

Just recently, more than a dozen channels you can’t get with an aerial were added.

This includes a channel for game show favourite The Chase, all Channel 4’s best property shows on 4Homes, plus 5 Cops for all ofmi 5‘s real crime hits.

Freely – which is run by BBC, ITV, Channel 4 and 5’s Everyone TV – has been adding a number of device partners since bursting onto the scene over a year ago.

Fire TV was a big newcomer but now Roku is getting on board too.

Freely will be available on the next generation of smart TVs powered by the Roku operating system.

Roku can be found on a number of major TV models, such as Sharp, Polaroid, and METZ.

“Offering Freely on the Roku operating system is a major milestone for us, as we continue to expand reach for the free streaming platform,” said Jonathan Thompson, CEO of Everyone TV.

Just last month, Freely announced some new features to rival premium services like Sky’s own streamed TV alternative Sky Glass.

A new backward TV guide was introduced, allowing people to scroll back on the screen and instantly see what’s been on recently, with a quick link directly to a catch up stream if one is available.

You can scroll back a full seven days.

A Never Miss feature was also added, which highlight programmes coming up, on now, and those you just missed, alongside the biggest and best shows available on demand.

And My List will let you save up to 50 of your favourite shows from the UK’s biggest free-to-air broadcasters all in one place so you can keep track of them.

RECENT CHANNEL ADDITIONS ON FREELY

• The Chase
• Saturday Night Every Night
• 4Reality
• 4Homes
• 4Life
• 5 GPs Behind Closed Doors
• 5 Bargain
• 5 The Yorkshire Vet
• 5 History
• 5 Crime
• Milkshake!
• 5 Police Interceptors
• 5 Cops
• 5 Trucking Hell
• 5 A&E
• 5 Dogs Behaving (Very) Badly

Image credit: Everyone TV

FREELY ON A STICK?

So far, Freely has only been made available on new smart TVs for sale.

But BBC boss Tim Davie recently hinted that a Fire Stick-like device with Freely on it could come in the future.

“We have been working hard to build digital platforms and content to meet changing audience needs, enriching our offer and welcoming the possibilities of a post broadcast world,” he said during a speech at Salford’s Lowry Theatre.

“We want to double down on Freely as a universal free service to deliver live TV over broadband.

“And we are considering a streaming media device with Freely capabilities built in, with a radically simplified user interface specifically designed to help those yet to benefit from IP services.”

WHAT NEEDS TO BE DONE BEFORE WE REPLACE FREEVIEW

Analysis by Jamie Harris, Assistant Technology and Science Editor at The Sun

DTT – digital terrestrial television – is the system used for Freeview broadcasts today.

About 18million homes still use it as their main way of watching TV.

Before we even begin to think about switching it off, we have to make sure no one is left behind.

So any internet-based alternative – Freely or otherwise – needs to be just as easy to install and use.

Then there’s the matter of broadband.

The UK needs to have reliable broadband everywhere so everyone has access.

Emphasis on reliable – no one wants buffering mid-way through a live football match.

So not only will broadband need to be pretty much everywhere it will need to be fast enough to handle demand all the time.

2