Roku Set For Q2 Spotlight As Ad Resilience, Frndly Boost, Amazon Deal Fuel Investor Optimism

Benzinga
2025.07.18 17:30
portai
I'm PortAI, I can summarize articles.

Roku, Inc. is set to benefit from the shift in ad spending to streaming, with optimism ahead of its Q2 earnings on July 31. JPMorgan's Cory A Carpenter raised Roku's price target from $85 to $100, citing stable ad spending and easing tariffs. He expects Roku to outperform expectations, reflecting Frndly's $40 million revenue in its outlook and a new partnership with Amazon. Carpenter increased his Q2 Platform revenue growth estimate to 15%, raising adjusted EBITDA from $70 million to $73 million. Roku shares rose 2.85% to $93.70.

Connected TV is poised to become one of the fastest-growing advertising channels in the coming years, with Roku, Inc. ROKU well-positioned to benefit from the ongoing shift in ad spending from traditional linear TV to streaming platforms.

Against this backdrop, Roku's recent momentum and strategic positioning have prompted optimism ahead of its upcoming second-quarter earnings release on Thursday, July 31.

JPMorgan analyst Cory A Carpenter reiterated the Overweight rating on Roku, raising the price forecast from $85 to $100.

Also Read: Netflix Courts YouTube Stars To Feed Its ‘Hungry Audience Waiting To Be Entertained’ — Co-CEO Ted Sarandos Hints At Premium Platform Edge Amid Creator Gold Rush

Carpenter noted Roku appears well-positioned to outperform expectations, with stable advertising spending in the second quarter and easing China tariffs providing a supportive backdrop.

The analyst pointed out that Roku chose not to raise its 2025 Platform revenue guidance last quarter, even after acquiring Frndly, potentially to leave room for macroeconomic uncertainties.

However, Carpenter now sees that approach as overly cautious and foresees Roku reflecting Frndly's estimated $40 million second-half revenue in its updated outlook.

He also highlighted the upcoming Amazon.com, Inc. AMZN DSP partnership, likely launching in the fourth quarter, as another potential boost to 2025 Platform revenue, which he believes wasn't factored into earlier guidance.

Trending Investment Opportunities

Carpenter raised his Platform revenue growth estimate to 15% for the second quarter and 14% for full-year 2025, both above Roku's official guidance of 14% and 12%, respectively.

This apart, the analyst noted that Roku's first-quarter guidance factored in some macroeconomic softness, but advertising spend held steady in the second quarter.

Per Carpenter, this stability is likely to drive a slight upside in Platform revenue.

As a result, he raised his adjusted EBITDA estimate for the second quarter from $70 million to $73 million, modestly above the company's guidance of $70 million and reflecting the expected revenue improvement.

ROKU Price Action: Roku shares are trading higher by 2.85% to $93.70 at publication on Friday.

  • Netflix’s Bet On Women’s Boxing Pays Off: Here’s How Many People Watched Taylor Vs. Serrano

Photo: Shutterstock

Source: Benzinga The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.