How Does Netflix's Sub Miss Impact Roku?

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About: Roku, Inc. (ROKU), Includes: NFLX
by: General Expert
This article is exclusive for subscribers.
General Expert
Event-driven, long/short equity, long-term horizon, special situations
Summary

Roku's value isn't dependent on Netflix.

Netflix is a big part of the streaming ecosystem, but many other content producers are ramping up their streaming offerings. Netflix does not dictate the industry.

Roku earns almost nothing from Netflix, so there will be no financial impact in the immediate future.

There isn't a strong relationship between Netflix subscriber growth and Roku's active accounts growth.

No matter how you think Netflix (NFLX) will fare in the future, the fact is that it missed its own subscriber growth estimates by a mile in Q2. U.S. net adds came in