Roku (NASDAQ: ROKU) shares surged up to 13% on Monday following a partnership announcement with Amazon (NASDAQ: AMZN) for a new connected TV integration via Amazon DSP. This collaboration allows advertisers access to Roku’s footprint, which encompasses approximately 80 million U.S. households, over 80% of the nation’s connected TV homes.
Data from early tests show that advertisers using the new platform reached 40% more unique viewers while reducing ad frequency by nearly 30%. As a result, Amazon connected TV advertisers are expected to achieve three times more value from their ad spend through this partnership. Roku’s stock has already rallied nearly 50% over the past year, despite being over 80% below its all-time high.
Roku has experienced 13 consecutive quarterly losses but reported an 18% revenue growth for 2024 and positive free cash flow. The company aims to return to profitability in the second half of this year, despite a projected 11% year-over-year revenue increase which would be its lowest in two years.
