Roku done with growth?

I was an early investor in Roku and largely rode it from IPO up to its market cap hitting around $8B, which I figured was about a good ceiling for what at the time I believed was a hardware company. However, now you can see Roku continuing to accelerate its focus to the high margin/high growth advertising business… and I’m rethinking my position.

Current market cap: $42.42B

What are your thoughts?

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I like Roku. I have one at my house and they are far easier to use and faster than the smart TV interface. They are the monopoly in this sector for now. I do see growth continue until another company comes along with a better product or smart TV interfaces catch up to Roku’s capabilities. They took a nice dip recently and it may be a good time to buy a few shares. If only we bought back in 2019 … one can dream lol.

The key question is do they have a moat now and into the future… I would argue at the moment no one can touch them, but what’s to stop google and amazon from really upping their offerings in the space to erode Roku’s platform advantage.

Without their physical platform, they won’t make any money on their advertising and Roku Channel content. Now if Roku can begin offering the Roku channel across devices (thus removing that risk), and build up its library to be a real competitor… then it will transform into a true streaming competitor (as opposed to a platform advertiser now).