Roku (ROKU) Is Up 10.2% After Return to Profitability and Share Buyback Completion – What's Changed

• Roku reported its third quarter 2025 results, showing a return to profitability with net income of US$24.81 million and revenue of US$1.21 billion, up from a net loss and US$1.06 billion in revenue a year earlier; the company also completed a US$50 million share buyback, repurchasing 536,071 shares.
• This marks the first time in recent years that Roku has reported positive net income for both the third quarter and nine-month periods, alongside management signaling confidence with a completed share repurchase program.
• We'll now consider how Roku's return to profitability and share buyback completion could influence the company's investment narrative going forward.

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Roku Investment Narrative Recap

To be a shareholder in Roku, you need to believe in the long-term growth of streaming platforms and the company's ability to drive sustained revenue through user and advertising growth, despite fierce competition. Roku’s return to profitability and the completed share buyback enhance the company’s financial stability, but do not fundamentally shift the most important catalyst, continued expansion of its active user base, or the main risk of competition from major tech and retail players eroding platform value and ad revenues in the near term.

The completion of Roku’s share buyback program, with over half a million shares repurchased for US$50 million, is directly tied to its improved quarterly results and signals an effort to return value to shareholders. While this move can support short-term investor sentiment, the most critical factor remains Roku's pace of user and engagement growth, alongside maintaining a differentiated platform in an increasingly crowded streaming device market.

By contrast, investors should still consider the risk that intensifying competition may limit Roku’s ability to grow households and sustain revenue as...

Read the full narrative on Roku (it's free!)

Roku's outlook anticipates $6.1 billion in revenue and $372.1 million in earnings by 2028. This is based on an expected 11.4% annual revenue growth rate and a $433.6 million increase in earnings from the current $-61.5 million.

Uncover how Roku's forecasts yield a $105.32 fair value, in line with its current price.

Exploring Other Perspectives

Ten private investors in the Simply Wall St Community estimate Roku’s fair value in a wide range from US$84.40 to US$146.30 per share. With such diversity of opinion, keep in mind that the greatest near-term challenge remains competition from large technology and retail players, which could pressure revenue growth and dampen future expectations.

Explore 10 other fair value estimates on Roku - why the stock might be worth 20% less than the current price!

Build Your Own Roku Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Roku research is our analysis highlighting 2 key rewards that could impact your investment decision.
• Our free Roku research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Roku's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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