Roku (ROKU) Stock Forecast & Price Target

Roku has established itself as the leading streaming operating system in the U.S., capturing 6.1% of total streaming time, which reflects a year-over-year increase of approximately 1.7 percentage points. The company's revenue estimates indicate a growth trajectory, with platform revenue projected to reach $4.75 billion, reflecting a 15.4% increase, driven by robust performance in streaming services distribution and rising subscription fees. Furthermore, Roku is anticipating EBITDA margin expansion of roughly 200 basis points by 2026, suggesting a focus on accelerating profitable growth and improved cash flow generation, which positions the company favorably for future performance.

Roku faces a challenging outlook as the advertising market displays significant volatility, which could lead to a deceleration in revenue growth, with core platform revenue growth expected to decline from 19% in 4Q25 to approximately 12% in 1Q26. Furthermore, content costs associated with The Roku Channel present a potential margin headwind, while ongoing losses in the devices business due to a loss-leader strategy may widen if component costs rise or if competitive pressures necessitate more aggressive pricing. Additionally, the potential for a broader macroeconomic slowdown poses risks to advertising budgets that could further impact Roku's revenue trajectory.