Roku Inc (NASDAQ:ROKU) is heading into its first-quarter earnings report with momentum and at least one Wall Street firm thinks the streaming platform is poised to beat expectations yet again.
Jefferies is reiterating its Outperform rating and $140 price target on the stock ahead of Roku's Q1 2026 results, due out Thursday after market close. The firm expects Roku to top both its own guidance and consensus estimates on the top and bottom lines.
On revenue, Jefferies is modeling $1.205 billion for the quarter, slightly ahead of the $1.204 billion consensus and above Roku's own guidance of roughly $1.2 billion, implying about 18% year-over-year growth.
The bulk of that is expected to come from Platform revenue, which Jefferies projects will grow 22% year-over-year to $1.075 billion, with advertising revenue up 19% to $577 million and subscription revenue climbing 25% to $499 million. Devices, by contrast, are expected to dip 7% to $130 million.
On profitability, Jefferies sees adjusted EBITDA coming in at $136 million, above guidance of $130 million and the $134 million consensus estimate. Gross margin is modeled at 44.2%.
The bigger picture, according to Jefferies, is that Roku's growth story has more runway than the market appreciates.
The firm believes the company is well-positioned to surpass its full-year 2026 guidance of $5.5 billion in revenue and $635 million in adjusted EBITDA, particularly given the tailwind from a political advertising cycle this year.
Jefferies also sees a path to $1 billion in free cash flow by 2028, supported by a significant stockpile of net operating losses that will help shield future earnings from taxes and funnel more cash toward share buybacks.