To The Moon

The collaboration between $Roku Inc(ROKU)$ and $Amazon.com(AMZN)$ is a undoubtedly significant piece of news in the secondary market recently.

According to the latest announcement, the two companies will provide the largest certified connected TV (CTV) reach in the United States to advertisers through Amazon's Demand-Side Platform (Amazon DSP).

This partnership is expected to be open to all Amazon DSP advertisers in the fourth quarter of 2025, covering approximately 80 million US households, which is over 80% of US CTV households.

Amazon and Roku Join Forces to Create Massive CTV Footprint

Market Significance

This partnership represents a major breakthrough for Roku. As one of the leading companies in the streaming media field, Roku can leverage Amazon's powerful advertising platform and data capabilities to further enhance its competitiveness in the advertising market. Early test results show that advertisers can reach 40% more unique viewers with the same budget, while reducing the frequency of the same user viewing the same ad by nearly 30%. This not only improves the efficiency of ad but delivery also brings more revenue opportunities for Roku.

Moreover, the partnership enhances the addressability of major streaming media applications, including Roku Channel, Prime Video, and other leading CTV streaming services on the Roku and Fire TV operating systems. This means that advertisers can precisely reach their target audiences on a wider range of platforms, improving the effectiveness of their ads.

Impact on Roku's Stock Price

After the announcement, Roku's stock price surged by 11.5% in early trading on Monday and closed with a gain of nearly 10%, reaching $81.28. This increase reflects the market's high expectations for the future of the partnership. Investors generally believe that the collaboration with Amazon will open up new revenue streams for Roku and further solidify its position in the advertising market.

Long-Term Outlook

In the long run, the partnership between Roku and Amazon will not only help Roku increase its market share but also drive the development of the entire connected TV advertising market. As more and more users shift to connected TV, the demand for CTV ads from advertisers is also increasing. This collaboration will bring more advertising revenue to Roku and provide broader user coverage for Amazon's demand-side platform.

However, investors should also pay attention to market volatility and potential risks. Although the future of the partnership looks promising, Roku's financial situation still faces certain challenges. According to data from InvestingPro, Roku's beta coefficient is 2.09 indicating, that its market volatility is higher than the average level. In addition, analysts expect that Roku may still not be profitable this year.

Summary

The partnership between Roku and Amazon is a win-win strategic move. For Roku, it is an excellent opportunity to increase its market share and advertising revenue; for Amazon, it further consolidates its leading position in the advertising market. Investors have reacted positively to the partnership, and Roku's stock price reflects the market's optimistic expectations for its future development. However, investors should still pay attention to market uncertainties and Roku's own financial situation.

According to the analysis function of the Tiger International APP, analysts' average target price for $Roku Inc(ROKU)$ is expected to be above $86, which means there is less than a 5% upside from the current price.

You can keep an eye on it and observe. The target price may be raised in the future.