Roku’s stock crashed hard after its pandemic highs. But the growth story is far from over.
Some investors thought Roku (ROKU -2.56%) was a pure hero of the coronavirus lockdown era. The media-streaming technology expert’s stock soared in 2020, stalled in 2021, and took a long, consistent swan dive over the next couple of years.
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It was fair to call Roku’s stock overvalued in 2021, but the company’s growth story never ended. In fact, I think Roku has many more high-growth chapters to share over the next several years, and the stock looks wildly undervalued these days.
And I only need one simple chart to illustrate this concept. As you can see in the graph below, Roku’s revenues are still experiencing explosive revenue growth:
ROKU Revenue (TTM) data by YCharts
Roku plays the long game
Sure, you see an abnormal bump around the COVID-19 era. Roku saw a few quarters of unsustainable user and revenue increases there, followed by a whiplash-inducing slowdown in the inflation-based market panic of 2023. Roku’s top-line sales growth hit the brakes pretty hard at that point.
Some of that was a clear-eyed and voluntary long-term growth strategy. You see, Roku saw a user-grabbing opportunity in the inflation-fighting crash. Consumers were more price-sensitive than ever and most of Roku’s streaming platform rivals were staving off inflation-based costs by raising prices. Yep, those companies contributed to the very inflation problem they were battling.
Not Roku. The company held service and hardware prices steady throughout the golden lockdown years and the following penny-pinching crash. As a result, the active user count rose from 70 million at the end of 2022 to 80 million a year later and 90 million in Q4 2024.
Atop this expanding user base, Roku is building a massive long-term business. Revenues quickly picked up speed after the 2023 pause, as seen in that handy chart. In July’s Q2 2025 report, free cash flow rose 23% year over year while adjusted EBITDA jumped 76%. And these are still the early innings of a long growth game.