Roku sold 40% more video ad impressions in the second quarter of 2026 than a year earlier and collected 12% less for each one, a volume-for-price trade that lifted advertising revenue 25% while confirming that supply growth is still outrunning demand across connected television.

The company published its second quarter results on August 6, 2026, in a shareholder letter attached to a Form 8-K and accompanied by a Form 10-Q covering the period ended June 30, 2026. Because of the pending acquisition by Fox Corporation, Roku held no earnings call and issued no financial outlook. That leaves the filings themselves as the only source of detail, and the most consequential line in them sits in the management discussion rather than the headline table.

Advertising revenue reached $672.8 million, up 25% from $539.1 million a year earlier. The 10-Q attributes that increase primarily to a rise in delivered video ad impressions. Video impressions grew 40%. The average price per impression fell 12%, which Roku attributes to changes in product and country mix. Across the first six months of 2026 the pattern is more pronounced: impressions up 48%, average price per impression down 13%.

Volume growth is doing the work

The arithmetic is worth spelling out. A 40% increase in impressions multiplied by a 12% decline in unit price produces roughly 23% revenue growth before any other factor. Reported advertising growth was 25%. Almost the entire advertising line, in other words, is being carried by inventory expansion rather than by pricing.

That places Roku squarely inside a dynamic that has been visible in market-wide data for months. Programmatic CTV pricing recorded a 25.8% year-over-year decline in April 2026 before narrowing to a 12.3% annual deficit in the most recent DataBeat reading, a contraction attributed to oversupply as new streaming entrants add ad-loaded inventory faster than budgets migrate. Roku's own 12% decline in average price per impression is close to that market figure, which suggests the pressure is structural rather than specific to Roku's sales execution.

Margins moved the other way. Advertising gross margin reached 62.4%, up roughly 190 basis points quarter over quarter and 650 basis points year over year. Roku credits a mix shift toward higher-margin ad products, meaning the native placements across the Roku Experience rather than in-stream video sold against licensed content. Cost of revenue for advertising rose only 6% against 25% revenue growth, held down by a $22.3 million increase in licensed content acquisition and delivery costs for The Roku Channel offset by a $7.7 million decrease in content amortisation. Advertising gross profit was $420.0 million, up 39%.

For buyers, the two numbers sit in tension. Cheaper impressions at higher seller margin is the signature of an inventory owner substituting owned surfaces for licensed ones. The home screen and the discovery rows carry no content licence attached to each impression. In-stream video does.

Programmatic now moves three-quarters of in-stream spend

Third-party demand-side platforms accounted for nearly three-quarters of in-stream video ad spend on the platform during the quarter, according to the shareholder letter. That is a materially different disclosure from the one Roku gave for the first quarter, when it reported that ad spend routed through third-party DSPs had grown more than 40% year over yearwithout stating a share of total.

Roku lists integrations with Amazon DSP, The Trade Desk, Google DV360 and Yahoo on the demand side, and Magnite, Google Ad Manager and FreeWheel on the supply side. The letter describes the goal as building "the most performant CTV ad platform in the industry, with a key focus on deepening our programmatic capabilities through expanded third-party integrations."

Roku Ads Manager, the self-service tool aimed at performance advertisers and small businesses, gained its first API-connected demand partner in the quarter. Smartly connected to Roku Ads Manager through the Roku Ads API in June 2026. Roku expects that integration to add incremental performance revenue by early 2027, which places any measurable contribution outside the current fiscal year.

The composition of demand also shifted. Spend from clients outside media and entertainment represented more than a third of total Roku Experience advertising revenue in the quarter, up from nearly 30% in the first quarter. The media and entertainment vertical itself posted one of its highest year-over-year growth rates in almost four years, a rebound that tracks the volume of streaming service launches and sports rights moves competing for viewer attention.

Political spending arrives early

Roku reports that second quarter political advertising on its platform exceeded the comparable quarter from the 2024 United States presidential election cycle. The comparison is unusual in that a midterm quarter outperforming a presidential quarter is not the normal pattern, and it lands as political CTV spending projections for the 2026 midterm cycle reached $2.7 billion, revised upward from an earlier $2.4 billion estimate.

Roku notes that political spend on its platform is weighted toward the back half of the year, building through late third quarter and into the fourth ahead of Election Day. The company gave no dollar figure for political revenue in either quarter, and provided no outlook, so the size of that back-half concentration remains undisclosed.

Subscriptions grow faster on price, not headcount

Subscriptions revenue reached $548.2 million, up 26%. The composition is instructive: the number of subscriptions rose 11% while the average price per subscription rose 25%. Growth is coming predominantly from what viewers pay rather than from how many of them pay, driven by a mix shift toward Premium Subscriptions, the arrangement under which viewers subscribe to third-party services through Roku's billing.

That mix carries a cost. Subscriptions gross margin fell roughly 360 basis points year over year to 41.4%, with cost of revenue for the segment climbing 34% against 26% revenue growth. Licensing and content costs, including those tied to Frndly TV, acquired in May 2025, and Howdy, launched in August 2025, account for the increase.

The quarter's subscription acquisition was driven by sport. FOX One and Peacock launched within Premium Subscriptions, bringing World Cup coverage to The Roku Channel in English and Spanish in the United States. Outside the United States, matches were available through Roku-billed direct-to-consumer services including Vix, TSN, Paramount+ and Globoplay, aggregated in a Soccer Zone within the Sports Experience. Roku describes the tournament as driving hundreds of thousands of sign-ups and calls it one of its largest cross-partner subscription acquisition events. Hours originating from an NBA discovery surface doubled year over year during the playoffs.

Howdy, the owned ad-free service priced at $3 per month, launched in Mexico and became available as a subscription option on Prime Video and as a standalone mobile app for iOS and Android.

A tariff refund flatters the devices line

Devices revenue was $133.7 million, down 1%. Gross margin registered 20.1%, an apparent reversal from the negative margins the segment has carried for several quarters. The reversal is not operational. It reflects a refund under the International Emergency Economic Powers Act for tariff payments made between the second quarter of 2025 and the first quarter of 2026. Excluding that refund, Roku states devices gross margin would have been negative 7.6%, net income would have been $127 million rather than $164 million, and free cash flow would have been $242 million.

Unit volume across all devices fell 31% while average selling price rose 35%, a shift driven by fewer streaming players and more Roku-branded televisions. Roku-made TVs represented approximately 5% of total United States TV unit sales volume in the quarter, according to Circana retail tracking data covering April to June 2026.

The company flags tightening memory chip supply as a pricing pressure across the electronics industry, and argues that the Roku TV operating system requires less DRAM and flash storage than competing platforms, a cost differential it says is attracting additional TV brands. OEM licensing relationships now include Hisense and TCL. Roku expects distribution costs associated with those partnerships to weight sales and marketing expense toward the second half of 2026, after that line fell 8% year over year in the second quarter.

Consolidated results and the merger overhang

Total net revenue was $1,354.7 million, up 22%. Total gross profit reached $673.7 million, up 35%, with consolidated gross margin at 49.7%. Net income was $164.2 million against $10.5 million a year earlier. Adjusted EBITDA reached $254.3 million, up 225%. Trailing twelve-month free cash flow was $704.1 million, against $392.0 million a year earlier. Streaming hours were 37.9 billion, up 7%.

General and administrative expense rose 25% to $124.6 million, of which $18.7 million was merger-related cost tied to the Fox transaction and $13.4 million the recognition of non-income based taxes. Research and development was effectively flat at $179.7 million.

The transaction terms are set out in the 10-Q. Roku entered the merger agreement on June 14, 2026, one day before Fox and Roku announced the deal publicly at approximately $22 billion in enterprise value. Each Roku share converts into 0.9693 of a share of Fox Class A common stock plus $96.00 in cash. Former Roku stockholders would hold approximately 27% of the combined company. Closing is anticipated in the first half of 2027, subject to shareholder approvals in both companies and clearance under the Hart-Scott-Rodino Act.

The break structure is asymmetric. Roku would owe Fox a termination fee of $866.1 million under specified circumstances, including termination to accept a superior proposal. Fox would owe Roku $1.2 billion if the agreement terminates following an antitrust or investment screening injunction, or on failure to obtain specified regulatory approvals by the termination date. That date is June 14, 2027, extendable to December 14, 2027 and in certain circumstances to March 14, 2028. If Fox fails to obtain its own shareholder approval, it reimburses Roku's third-party transaction expenses up to $70 million.

Roku suspended its share repurchase programme during the quarter on entering the merger agreement, having bought 534,004 shares at an average of $117.42 before the suspension. Cash and equivalents stood at $2,001.8 million with short-term investments of $555.4 million. A subsequent event disclosed in the filing records a July 5, 2026 agreement terminating the impaired portion of a corporate office lease, expected to generate an approximately $22 million credit to operating expenses in the third quarter.

What the numbers signal for buyers

Roku restructured its reporting into three segments, Advertising, Subscriptions and Devices, effective in the first quarter of 2026, ending the combined Platform disclosure it had used since flotation. That change followed an April 2026 disclosure separating advertising and subscription revenue for the first time, and it now permits quarter-by-quarter tracking of exactly the divergence visible here: advertising margin expanding while unit prices compress, subscription revenue expanding while margin compresses.

The practical reading for media buyers is that Roku's inventory is becoming cheaper per impression at a moment when its programmatic accessibility is at its highest, with roughly three-quarters of in-stream spend arriving through third-party platforms and home screen inventory available across the redesigned interface that completed its United States rolloutearly in the third quarter. Falling unit prices in a growing supply pool also raise the question of whether the additional impressions carry equivalent audience value, a concern that measurement specialists have pressed in CTV, where completion rates approaching 98% are structural rather than earned and therefore weak as a quality signal.

With no outlook and no call, the next quarterly filing arrives without management commentary attached. The direction of the average price per impression across the political spending peak in the third and fourth quarters is the metric that will indicate whether the 12% decline was a mix effect or a market floor.

Timeline

Summary

Who: Roku, Inc., the San Jose streaming platform company, reporting through founder and chief executive Anthony Wood and chief financial and operating officer Dan Jedda. Fox Corporation is the pending acquirer. The results affect media buyers purchasing connected television inventory through Amazon DSP, The Trade Desk, DV360, Yahoo, Magnite, Google Ad Manager and FreeWheel.

What: Second quarter 2026 results showing total net revenue of $1,354.7 million, up 22%, advertising revenue of $672.8 million, up 25%, subscriptions revenue of $548.2 million, up 26%, and net income of $164.2 million. Video ad impressions rose 40% while the average price per impression fell 12%. Advertising gross margin reached 62.4%. Devices gross margin of 20.1% reflected a tariff refund without which the segment would have posted a negative 7.6% margin.

When: The results were published on August 6, 2026, covering the quarter ended June 30, 2026. The merger agreement with Fox was signed on June 14, 2026, with closing anticipated in the first half of 2027 and a termination date of June 14, 2027 extendable to March 14, 2028.

Where: Roku operates its platform in the United States, Canada, Mexico, the United Kingdom and other markets, with licensed Roku TV models sold in more than 15 countries. Most platform revenue is generated in the United States. The company is headquartered at 1173 Coleman Avenue, San Jose, California.

Why: The divergence between impression volume and unit price is the operative fact for advertisers. Roku is delivering substantially more inventory at lower prices while expanding its own margin on that inventory, a pattern consistent with market-wide connected television price contraction and with a mix shift toward owned home screen placements. The absence of an earnings call and financial outlook, a consequence of the pending Fox transaction, removes the forward guidance that buyers and analysts have used to plan against Roku's inventory supply through the political advertising peak.