Walmart’s Streaming Play Swamps Roku

Roku has a long history of holding its own against tech giants.
Roku has a long history of holding its own against tech giants.


The retail giant’s acquisition of Vizio raises distribution worries as Roku’s platform growth has slowed.

Roku has no shortage of very large competitors. It still isn’t a great time for the streaming TV platform to have a new one.

And a big one it is. Walmart’s acquisition of Vizio, which the retailer announced Tuesday morning alongside its fiscal fourth-quarter results, will give the world’s largest company by annual revenue ownership of a connected TV brand that competes with Roku on both physical and virtual shelves. It also gives Walmart a stronger foothold in the business of selling ads, subscriptions and other revenue-generating activities that—as Roku has demonstrated—are actually far more profitable endeavors than selling the TV sets themselves.

Walmart has long had big ambitions in media, not all of which have panned out. The company once even considered building a full streaming service to compete with the likes of Netflix. As a maker of streaming boxes and connected TVs—and the operating system they run on—Roku also has a long history of holding its own against tech giants such as Apple, Amazon, Google and Samsung. It ended 2023 with a little over 54% of connected TV users in the U.S., according to data from Insider Intelligence.

But investors seem to be assuming the worst this time. Roku’s share price fell nearly 9% last week after The Wall Street Journal first reported the talks between Walmart and Vizio, and the stock gave up another 6.6% on Tuesday. When coupled with a sharp selloff the stock took on Friday following the company’s fourth-quarter results, Roku has shed nearly one-third of its market value in the past week.

That might seem excessive for a company that is now effectively the TV home page for 80 million active streaming accounts. But Roku’s growth has slowed notably of late because of a mix of supply and cost pressures on its hardware side and a cooling of the so-called streaming war on the platform side.

Roku’s platform business benefited greatly from the launch of new streaming services such as Disney+, Peacock, HBO Max and Paramount Plus between 2019 and 2021 as the parent companies of those services bought ads and used Roku’s platform for other promotions. But investors soon soured on streamers’ growth-at-all-costs strategy, which caused their need for Roku’s services to skid as well. The company’s platform revenue grew just 10% in 2023 after averaging annual growth of 67% over the previous five years.

Wall Street worries that the entry of another massive competitor will make it that much harder for Roku to regain its growth momentum. In a report last week, Ben Swinburne of Morgan Stanley wrote that acquiring Vizio “would signal a greater focus by Walmart on owning the living room and building its broader media business." And analyst Michael Nathanson of MoffettNathanson called the deal “a significant challenge for Roku" given that Walmart is one of the largest sales channels for Roku’s TVs.

And while he didn’t mention the possibility of the Vizio deal, Oppenheimer analyst Jason Helfstein downgraded Roku’s stock to a neutral rating following its results last week, writing in a note to clients that the shares will likely underperform “until the company sustainably delivers high-teens Platform revenue growth." Roku needs to show that even Walmart can’t box it in.

Write to Dan Gallagher at

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