Roku has kicked off 2025 with better-than-expected first-quarter results and a major move in the live TV streaming market. The company reported a 16% jump in revenue to $1.02 billion and revealed plans to buy Frndly TV, a low-cost streaming service, for $185 million in cash.
For the quarter ending March 31, Roku recorded a net loss of $27.4 million, or 19 cents per share. While still in the red, that’s a notable improvement compared to a $50.9 million loss in the same period last year. Wall Street had predicted a slightly lower revenue of $1.01 billion and a bigger loss of 25 cents per share, according to estimates from LSEG Data & Analytics.
The company also announced the acquisition of Denver-based Frndly TV, which offers affordable access to over 50 live TV channels such as A&E, Hallmark Channel, History, and Lifetime. The service starts at $6.99 per month and includes cloud DVR and on-demand content. The deal includes $75 million in earn-outs, which are tied to Frndly TV hitting performance goals over the next two years.
Anthony Wood, Founder and CEO, Roku, said, “Frndly TV’s impressive growth and expertise in direct-to-consumer subscription services make it a compelling addition to Roku. This acquisition supports our focus on growing platform revenue and Roku-billed subscriptions, with a live content offering our users love at an industry-leading price point.”
Roku expects to close the Frndly TV acquisition in the second quarter of 2025, depending on regulatory approvals and closing conditions. After the deal is done, Frndly TV’s team, including CEO Andy Karofsky, will remain with the company. The service will continue to be accessible across all major platforms, including Roku, Fire TV, Apple TV, Android TV, Samsung, Vizio, and mobile devices.
Looking ahead, Roku said it anticipates second-quarter revenue of around $1.07 billion, representing 11% year-over-year growth. This falls just short of analysts’ expectations of $1.09 billion for the June quarter.
In a letter to shareholders, Wood and Roku CFO Dan Jedda addressed challenges in the Devices segment. “While tariff-related impacts to our Devices segment remain difficult to predict, we expect Devices revenue and gross profit loss to remain consistent with 2024 levels,” they wrote. “We remain vigilant and adaptable as market conditions evolve. While uncertainty remains, we are confident in our strategy and continue to see a path to achieving positive operating income in 2026.”
In Q1, Roku’s Platform segment, which includes advertising and subscription revenue, grew by 17% to $880.8 million. Meanwhile, revenue from its Devices segment reached $140 million, up 11%. Roku also saw a 17% increase in total streaming hours, reaching 35.8 billion for the quarter.
Roku said in a statement, “We strongly disagree with the allegations in the lawsuit, which do not reflect how our services work or our efforts to protect viewer privacy. We plan to challenge these inaccurate claims and look forward to demonstrating our commitment to trust and compliance.”
However, the company will no longer provide updates on streaming households or average revenue per user (ARPU) each quarter. Roku had 89.8 million streaming households at the end of 2024 and expects growth to continue, especially in the U.S., where its devices are used in about half of broadband homes.
Roku has also launched new streaming players and Roku-branded TVs, as well as updated its user interface with a new “Coming Soon to Theaters” section and personalized sports highlights.
Amid the positive momentum, Roku faces a legal challenge. Michigan Attorney General Dana Nessel has filed a lawsuit accusing the company of violating child privacy laws. Roku responded firmly to the claims, saying it plans to fight the allegations.