Fox intends to acquire Roku’s streaming hardware, operating system, and FAST offerings.
Fox Corporation has reached an agreement to purchase Roku Inc. at $160 per share, representing an approximate enterprise value of $22 billion, the companies revealed today.
The deal would combine Fox’s broadcast networks—including Fox, Fox News, Fox Business, and FS1—along with its streaming properties such as Tubi, a free ad-supported streaming television (FAST) platform Fox acquired in 2020, with Roku’s own FAST service, The Roku Channel, and Roku’s streaming hardware business, which includes streaming sticks and smart TVs. Roku reports that 100 million households utilize its platform.
The most valuable component of Roku’s operations is not its hardware, which incurred a loss of $19.1 million in the quarter ending March 31, 2026, but rather its operating system (Roku OS) and advertising business. During that same quarter, Roku’s advertising and subscriptions segment generated a gross profit of $584.1 million, with the advertising division bringing in $371 million in revenue. The COVID-19 pandemic enabled Roku to turn profitable in 2021, but the company did not achieve annual profitability again until 2025.
The proposed merger is designed to help Roku scale and sustain profitability more readily by allowing Roku “to execute on our strategy faster than we would otherwise by ourselves, even though we’re doing extremely well,” Anthony Wood, Roku’s CEO, stated during a call with investors today.
“Fox and Roku are committed to continuing to operate Roku as an open, partner-friendly platform and to the continued ubiquitous distribution of Fox content. On a pro forma basis, the combined company will become the third-largest player in US television by share of viewing,” today’s announcement stated. This statistic appears to reference Nielsen’s data for “aggregated view of total TV usage by media company” in March. The top-viewed distributors were YouTube (13.2 percent), The Walt Disney Company (10.5 percent), and NBCUniversal/Versant (8.4 percent). Fox ranked fourth (7.2 percent), while The Roku Channel was ninth (3 percent).
Credit: Nielsen Credit:
Nielsen
In return, Fox would gain a fresh avenue for ad sales and user tracking via The Roku Channel and Roku OS, which features a significant number of ads. The merger would also help Fox move beyond its traditional business and deepen its presence in streaming, enhancing its appeal to advertisers.
“Advertisers are … seeking large audiences, improved digital targeting and more consistent measurement across platforms,” Lachlan Murdoch, Fox’s CEO and chair executive, said during today’s investors call. “These converging dynamics across viewing, aggregation, and advertising have fueled the rapid growth of connected TV, and we are still in the early stages of this transition.”
If the deal is finalized, Fox shareholders are expected to own roughly 73 percent of the combined entity, while Roku shareholders are anticipated to own about 27 percent. Fox would take on $8 million in debt to finance the Roku acquisition, and the companies anticipate reducing combined costs by $400 million.
Under the terms of the acquisition, Roku’s Wood would join Fox’s board of directors and have “an ongoing role at the combined company,” the announcement noted without offering further specifics.
The acquisition is subject to closing conditions, including regulatory approval and approval from both Fox and Roku shareholders. It is expected to close in the first half of 2027.
This announcement represents further consolidation within the streaming industry, which has broadly struggled to achieve and maintain profitability while delivering always-on, on-demand service at prices lower than cable. With other deals, such as Paramount acquiring HBO Max and the rest of Warner Bros. Discovery and Disney purchasing Hulu, we anticipate additional mergers and acquisitions, particularly as legacy media and smaller streaming services seek ways to bolster profits.