Roku said it secured more than $1 billion in commitments from advertisers during the upfront market, a record for the streaming platform.
With more consumers cutting the cord and shifting to streaming, Roku has positioned itself as an alternative to traditional TV. Roku said its upfront negotiation happened concurrently with the broadcast networks, signaling a strategic shift to TV streaming for brands.
“We continue to take ad dollar share away from traditional TV,” Roku said in its shareholder letter announcing its second quarter earnings.
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When most of the major traditional media companies reported their upfront results, a large percentage of their volume was in streaming and digital. NBCU reported that it has secured $1 billion in upfront sales for its Peacock streaming service, double last year’s haul.
Roku said it was able to make upfront deals with all seven of the major agencies' holding companies.
It said it had 100% client retention in several key categories, including auto, telecom and travel, and that 25% of all the advertisers who made upfront commitments with Roku were new and hadn’t made upfront deals with Roku last year.
Roku said its upfront for the 2022-23 TV years was strong despite overall economic weakness in the second quarter that slowed TV advertising spending and put pressure on Roku’s platform revenue growth.
“The significant and long-term opportunity in TV streaming is not changed by the current economic cycle,” Roku said in its shareholder letter. “A significant gap remains between TV streaming viewership and ad spend. In Q2, U.S. consumers aged 18-49 spent more than half of their TV time streaming while advertisers are expected to spend just 22% of U.S. TV ad budgets on streaming in 2022. Over time, we expect this gap to close as advertising dollars continue to follow audiences to TV streaming.” ■
