Accordingly, Roku’s average revenue per user was also up 18% year-over-year, to $24.92. The company said its advertising business grew in the quarter as advertisers increasingly shift their spending from traditional TV to streaming—accelerating a trend that existed even before the pandemic. Monetized video ad impressions were up 50% from the same period last year.

Most ads on Roku exist on the home screen and its free channels, but recently some users have complained about an increase in interactive pop-up ads during some commercials.

“As economic pressures caused advertisers to further re-evaluate how much and where to invest media dollars, Roku delivered strong growth in our ad business, particularly relative to the overall TV ad market that was down,” the company said in a letter to investors. TV ad spending in the US declined 29% year-over-year, Roku added, citing data from the media intelligence firm Magna Global.

The math is simple. The more time users spend streaming on Roku, the more advertisers want to advertise there and the more revenue Roku generates. The company said engagement with the platform peaked in the middle of the quarter, but still remains higher than what it was before Covid-19.

Though streaming and traditional television are clearly headed in opposite directions, Americans, at least, still watch more regular TV. Driven by older age demographics, US viewers on average watched 3.5 hours of live or on-demand TV per day in 2019, versus only 38 minutes spent streaming.

But the pandemic has closed the gap. Without live sports for most of the past four months, Americans have continued ditching their cable TV packages. AT&T’s base of TV subscribers has eroded 18% in the last year alone. Comcast and other major cable providers have posted similar declines in recent months. Soon, there won’t be a gap at all. Streaming will be the predominant form of TV consumption, and Roku appears ready to capitalize.

Correction: This post has been updated to reflect that Roku has 43 million accounts globally, not just in the US.

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