ROKU, INC (Form: 10-Q, Received: 08/09/2019 17:00:26)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38211

Roku, Inc.

(Exact name of registrant as specified in its charter)

Delaware

26-2087865

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer

Identification No.)

150 Winchester Circle

Los Gatos, California 95032

(Address of principal executive offices including zip code)

Registrant’s telephone number, including area code: (408) 556-9040

Securities registered pursuant to Section 12(b) of the Act:



Title of Each Class:	Trading Symbol(s):	Name of Exchange on Which Registered:
Class A Common Stock, $0.0001 par value	“ROKU”	The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 31, 2019, the registrant had 85,421,696 of Class A common stock, $0.0001 par value per share, and 30,812,380 shares of Class B common stock, $0.0001 par value per share, outstanding.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION	1
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Comprehensive Income (Loss)	3
	Condensed Consolidated Statement of Stockholders’ Equity	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29
PART II.	OTHER INFORMATION	30
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	58
Item 3.	Defaults Upon Senior Securities	58
Item 4.	Mine Safety Disclosures	58
Item 5.	Other Information	58
Item 6.	Exhibits	59
Signatures		60

NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“the Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (“the Exchange Act”) about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this report, including statements regarding our future results of operations and financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, forward-looking statements may be identified by words such as “anticipate,” “believe,” “continue,” “could,” “design,” “estimate,” “expect,” “intend,” “may,” “plan,” “potentially,” “predict,” “project,” “should,” “will” or the negative of these terms or other similar expressions.

Forward-looking statements are based on our management’s beliefs and assumptions and on information currently available. These forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions, including risks described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q, regarding, among other things:

•

our financial performance, including our revenue, cost of revenue, operating expenses and our ability to attain and sustain profitability;

•

our ability to attract and retain users and increase hours streamed;

•

our ability to attract and retain advertisers;

•

our ability to attract and retain additional TV brands to deploy our technology;

•

our ability to acquire rights to distribute popular content on our platform on favorable terms, or at all, including the renewals of our existing agreements with content publishers;

•

changes in consumer viewing habits or the growth of TV streaming;

•

the growth of our relevant markets, including the growth in advertising spend on TV streaming platforms, and our ability to successfully grow our business in those markets;

•

our ability to adapt to changing market conditions and technological developments, including developing integrations with our platform partners;

•

our ability to develop and launch new streaming products and provide ancillary services and support;

•

our ability to compete effectively with existing competitors and new market entrants;

•

our ability to successfully manage domestic and international expansion;

•

our ability to attract and retain qualified employees and key personnel;

•

security breaches and system failures;

•

our ability to maintain, protect and enhance our intellectual property; and

•

our ability to comply with laws and regulations that currently apply or may become applicable to our business both in the United States and internationally, including compliance with the EU General Data Protection Regulation.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.

Other sections of this Quarterly Report on Form 10-Q may include additional factors that could harm our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk factors nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in, or implied by, any forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this report or to conform these statements to actual results or to changes in our expectations. You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to this report with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

Investors and others should note that we may announce material business and financial information to our investors using our investor relations website (ir.roku.com/investor-relations), our filings with the Securities and Exchange Commission, webcasts, press releases, and conference calls. We use these mediums, including our website, to communicate with investors and the general public about our company, our products, and other issues. It is possible that the information that we make available may be deemed to be material information. We therefore encourage investors and others interested in our company to review the information that we make available on our website.

iii

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

ROKU, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

	As of
	June 30, 2019			December 31, 2018
Assets
Current Assets:
Cash and cash equivalents	$	375,509		$	155,564
Short-term investments		10,987			42,146
Restricted cash		868			—
Accounts receivable, net of allowances		204,037			183,078
Inventories		39,443			35,585
Prepaid expenses and other current assets		19,063			15,374
Deferred cost of revenue, current		44			1,188
Total current assets		649,951			432,935
Property and equipment, net		48,402			25,264
Operating lease right-of-use assets		115,961			—
Intangible assets, net		1,200			1,477
Goodwill		1,382			1,382
Other non-current assets		3,929			3,939
Total Assets	$	820,825		$	464,997
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable and accrued liabilities	$	201,732		$	148,562
Deferred revenue, current		36,536			45,442
Total current liabilities		238,268			194,004
Deferred revenue, non-current		13,889			19,594
Operating lease liability, non-current		105,513			—
Other long-term liabilities		2,473			6,748
Total Liabilities		360,143			220,346
Stockholders’ Equity:
Common stock, $0.0001 par value		12			11
Additional paid-in capital		733,627			498,553
Accumulated other comprehensive income (loss)		4			(17	)
Accumulated deficit		(272,961	)		(253,896	)
Total stockholders’ equity		460,682			244,651
Total Liabilities and Stockholders’ Equity	$	820,825		$	464,997

See accompanying notes to condensed consolidated financial statements.

ROKU, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

	Three Months Ended						Six Months Ended
	June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Net Revenue:
Platform	$	167,682		$	90,341		$	301,835		$	165,418
Player		82,419			66,469			154,928			127,968
Total net revenue		250,101			156,810			456,763			293,386
Cost of Revenue:
Platform		57,980			27,328			98,344			48,994
Player		77,912			51,730			143,319			103,528
Total cost of revenue		135,892			79,058			241,663			152,522
Gross Profit:
Platform		109,702			63,013			203,491			116,424
Player		4,507			14,739			11,609			24,440
Total gross profit		114,209			77,752			215,100			140,864
Operating Expenses:
Research and development		61,994			40,196			117,732			74,322
Sales and marketing		36,568			22,259			70,375			42,577
General and administrative		26,033			15,429			48,119			30,999
Total operating expenses		124,595			77,884			236,226			147,898
Loss from Operations		(10,386	)		(132	)		(21,126	)		(7,034	)
Other Income, Net:
Interest expense		(571	)		(57	)		(669	)		(108	)
Other income, net		1,240			361			2,207			809
Total other income, net		669			304			1,538			701
Income (Loss) Before Income Taxes		(9,717	)		172			(19,588	)		(6,333	)
Income tax (benefit) expense		(384	)		(354	)		(523	)		(225	)
Net Income (Loss)	$	(9,333	)	$	526		$	(19,065	)	$	(6,108	)
Net income (loss) per share —basic	$	(0.08	)	$	0.01		$	(0.17	)	$	(0.06	)
Net income (loss) per share —diluted	$	(0.08	)	$	0.00		$	(0.17	)	$	(0.06	)

Weighted-average shares used in computing net income (loss) per share —basic		114,572			102,652			112,734			101,079
Weighted-average shares used in computing net income (loss) per share —diluted		114,572			121,698			112,734			101,079

See accompanying notes to condensed consolidated financial statements.

ROKU, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)

(unaudited)

	Three Months Ended					Six Months Ended
	June 30, 2019			June 30, 2018		June 30, 2019			June 30, 2018
Net Income (Loss)	$	(9,333	)	$	526	$	(19,065	)	$	(6,108	)
Other comprehensive income, net of tax:
Unrealized gain on short-term investments, net of tax		3			—		21			—
Comprehensive Net Income (Loss)	$	(9,330	)	$	526	$	(19,044	)	$	(6,108	)

See accompanying notes to condensed consolidated financial statements.

ROKU, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(in thousands)

(unaudited)

	Three and Six Months Ended June 30, 2019

		Common Stock					Additional Paid-in		Treasury			Accumulated Other Comprehensive			Accumulated			Total Stockholders’
		Shares			Amount		Capital		Stock			Income / (Loss)			Deficit			Equity
Balance—March 31, 2019			113,292		$	11	$	625,221	$	(671	)	$	1		$	(263,628	)	$	360,934
Vesting of early exercised stock options			—			—		15		—			—			—			15
Issuance of common stock pursuant to equity incentive plans, net of taxes			1,867			1		9,056		—			—			—			9,057
Issuance of common stock in connection with at-the-market offering, net of issuance costs of $1.6 million			1,000			—		81,335		—			—			—			81,335
Stock-based compensation expense			—			—		18,671		—			—			—			18,671
Unrealized gain on short-term investments			—			—		—		—			3			—			3
Net loss			—			—		—		—			—			(9,333	)		(9,333	)
Balance—June 30, 2019			116,159		$	12	$	734,298	$	(671	)	$	4		$	(272,961	)	$	460,682

Balance—December 31, 2018			109,770		$	11	$	499,224	$	(671	)	$	(17	)	$	(253,896	)	$	244,651
Vesting of early exercised stock options			—			—		32		—			—			—			32
Share repurchases			(2	)		—		—		—			—			—			—
Issuance of common stock pursuant to equity incentive plans, net of taxes			4,002			1		19,147		—			—			—			19,148
Issuance of common stock in connection with at-the-market offering, net of issuance costs of $3.6 million			2,389			—		179,360		—			—			—			179,360
Stock-based compensation expense			—			—		36,535		—			—			—			36,535
Unrealized gain on short-term investments			—			—		—		—			21			—			21
Net loss			—			—		—		—			—			(19,065	)		(19,065	)
Balance—June 30, 2019			116,159		$	12	$	734,298	$	(671	)	$	4		$	(272,961	)	$	460,682

	Three and Six Months Ended June 30, 2018

		Common Stock					Additional Paid-in		Treasury			Accumulated Other Comprehensive			Accumulated			Total Stockholders’
		Shares			Amount		Capital		Stock			Income / (Loss)			Deficit			Equity
Balance—March 31, 2018			100,968			10		445,862		(723	)		—			(251,673	)		193,476
Vesting of early exercised stock options			—			—		67		—			—			—			67
Issuance of common stock pursuant to equity incentive plans, net of taxes			4,093			1		12,386		—			—			—			12,387
Stock-based compensation expense			—			—		5,309		—			—			—			5,309
Net income			—			—		—		—			—			526			526
Balance—June 30, 2018			105,061		$	11	$	463,624	$	(723	)	$	—		$	(251,147	)	$	211,765

Balance—December 31, 2017			99,157			10		436,278		(671	)		—			(283,338	)		152,279
Vesting of early exercised stock options			—			—		173		—			—			—			173
Issuance of common stock pursuant to equity incentive plans, net of taxes			5,763			1		17,435		(52	)		—			—			17,384
Issuance of common stock pursuant to exercise of common warrants, net			141			—		—		—			—			—			—
Stock-based compensation expense			—			—		9,738		—			—			—			9,738
Adoption of ASU 2016-16			—			—		—		—			—			(40	)		(40	)
Adoption of ASU 2014-09			—			—		—		—			—			38,339			38,339
Net loss			—			—		—		—			—			(6,108	)		(6,108	)
Balance—June 30, 2018			105,061		$	11	$	463,624	$	(723	)	$	—		$	(251,147	)	$	211,765

See accompanying notes to condensed consolidated financial statements.

ROKU, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Six Months Ended
	June 30, 2019			June 30, 2018
Cash flows from operating activities:
Net loss	$	(19,065	)	$	(6,108	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		5,677			3,606
Stock-based compensation expense		36,535			9,738
Provision for doubtful accounts		53			286
Non-cash interest expense		412			—
Loss from exit of facilities		—			385
Amortization of premiums on short-term investments		(265	)		—
Changes in operating assets and liabilities:
Accounts receivable		(21,012	)		9,383
Inventories		(3,858	)		(6,799	)
Prepaid expenses and other current assets		(5,377	)		309
Operating lease right-of-use assets		7,738			—
Deferred cost of revenue		1,144			2,010
Other noncurrent assets		10			(1,333	)
Accounts payable and accrued liabilities		32,255			(19,000	)
Operating lease liabilities		(4,405	)		—
Other long-term liabilities		(1,197	)		(558	)
Deferred revenue		(14,611	)		(3,387	)
Net cash provided by (used in) operating activities		14,034			(11,468	)
Cash flows from investing activities:
Purchase of property and equipment		(23,171	)		(9,013	)
Purchases of short-term investments		(12,365	)		—
Sales/maturities of short-term investments		43,810			—
Net cash provided by (used in) investing activities		8,274			(9,013	)
Cash flows from financing activities:
Proceeds from equity issued under incentive plans		19,145			17,398
Proceeds from equity issued under at-the-market program, net of offering costs		179,360			—
Net cash provided by financing activities		198,505			17,398
Net Increase (Decrease) in cash, cash equivalents and restricted cash		220,813			(3,083	)
Cash, cash equivalents and restricted cash—Beginning of period		155,564			177,250
Cash, cash equivalents and restricted cash—End of period	$	376,377		$	174,167
Cash, cash equivalents and restricted cash at end of period:
Cash and cash equivalents		375,509			174,167
Restricted cash		868			—
Cash, cash equivalents and restricted cash—End of period	$	376,377		$	174,167
Supplemental disclosures of cash flow information:
Cash paid for interest	$	960			1
Cash paid for income taxes	$	636		$	349
Supplemental disclosures of non-cash investing and financing activities:
Unpaid portion of property and equipment purchases	$	6,984		$	1,043
Unpaid portion of at-the-market offering costs	$	459			—

See accompanying notes to condensed consolidated financial statements.

ROKU, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. THE COMPANY

Organization and Description of Business

Roku, Inc. (the “Company” or “Roku”), was formed in October 2002 as Roku LLC under the laws of the State of Delaware. On February 1, 2008, Roku LLC was converted into Roku, Inc., a Delaware corporation. The Company’s TV streaming platform allows users to easily discover and access a wide variety of movies, TV episodes, live programming and more. The Company operates in two reportable segments and generates revenue through the sale of streaming players, advertising, content distribution, subscription and transaction revenue sharing, as well as through licensing arrangements with TV brands.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on March 1, 2019.

The condensed consolidated balance sheet as of December 31, 2018 has been derived from the audited consolidated financial statements as of that date but does not include all of the information and footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. The interim financial information is unaudited, but reflects all normal recurring adjustments that are, in the opinion of management, necessary to fairly present the information set forth herein. The results of operations for the three and six months ended June 30, 2019 are not necessarily indicative of the operating results to be expected for the full year or any future periods.

There have been no material changes in the Company’s significant accounting policies other than the adoption of Accounting Standards Update (“ASU”) ASU 2016-02, Leases (Topic 842), (“ASC 842”), described below and in Note 7, and debt issuance costs, described in Note 8, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Use of Judgements and Estimates

The preparation of the Company’s condensed consolidated financial statements in accordance with U.S. GAAP requires management to make certain estimates, judgements, and assumptions that affect the reported amounts of assets and liabilities and related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Significant items subject to such estimates and assumptions include: for revenue recognition, determining the nature and timing of satisfaction of performance obligations, variable consideration, determining the stand-alone selling prices of performance obligations, gross versus net revenue reporting, evaluation of customer versus vendor relationships, and other obligations such as sales return reserves and customer incentive programs; the valuation of inventory, the valuation of deferred income tax assets, the recognition and disclosure of contingent liabilities and stock-based compensation. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results may differ from the Company’s estimates and assumptions.

Principles of Consolidation

The condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Comprehensive Income (Loss)

Comprehensive income (loss) includes unrealized gains (loss) on the Company’s short-term investments for the three and six months ended June 30, 2019. The Company did not have any short-term investments during the three and six months ended June 30, 2018. As a result, comprehensive income (loss) was equal to the net loss for the three and six months ended June 30, 2018.

Concentrations

Customers accounting for 10% or more of the Company’s net revenue were as follows:

	Three Months Ended						Six Months Ended
	June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Customer B	*			*				10	%	*
Customer C		14	%		17	%		13	%		17	%

Customers accounting for 10% or more of the Company’s accounts receivable were as follows:

As of

June 30,

2019

December 31,

2018

Customer D

* Less than 10%

Restricted Cash

Restricted cash is comprised of cash collateral for outstanding letters of credit related to operating leases of office facilities. As of June 30, 2019, the Company had restricted cash of $0.9 million. The Company did not have any restricted cash as of December 31, 2018.

Content Licensing

The Company acquires rights to video content for viewing on The Roku Channel. Consideration for these content rights can include a fixed fee and/or a share of advertising revenue. The Company capitalizes content licensing fees and records a corresponding liability when the license period has begun, the cost of the licensed content is determinable, and the content is accepted and available for streaming. The Company amortizes licensed content assets into “Cost of Revenue, Platform” over the contractual window of availability.

As of June 30, 2019, content related expenses that met these requirements were not material.

Recently Adopted Accounting Standards

In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-02, Leases (Topic 842), in order to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under prior GAAP. ASU 2016-02 requires that a lessee should recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on the balance sheet.

On January 1, 2019, the Company adopted the guidance in ASC 842 using the optional transition method and recorded right-of-use (“ROU”) assets and lease liabilities on its condensed consolidated balance sheet. As a result, periods prior to 2019 were not adjusted. On the adoption date, the Company recognized ROU assets totaling $39.9 million, lease liabilities totaling $42.1 million and reclassification of deferred and prepaid rents of $2.2 million to ROU assets on its condensed consolidated balance sheet. There was no impact to the accumulated deficit. The Company elected the package of practical expedients permitted under the transition guidance that allowed, among other things, the historical lease classification to be carried forward without reassessment. The Company did not elect the hindsight practical expedient to determine the lease term for existing leases. Refer to Note 7 for additional disclosures.

Recently Issued Accounting Pronouncements Not Yet Adopted

In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Topic 350), Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which requires hosting arrangements that are service contracts to follow the guidance for internal-use software to determine which implementation costs can be capitalized. The guidance is effective either prospectively or retrospectively for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company is currently in the process of evaluating the impact of this new guidance on the consolidated financial statements and the related disclosures.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurements (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. This standard removes, modifies, and adds certain disclosure requirements for fair value measurements. This pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. The Company is currently in the process of evaluating the effects of the new guidance but does not expect the impact from this standard to be material.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The guidance amends reporting of credit losses for assets held at amortized cost basis and available-for-sale debt securities to require that credit losses on available-for-sale debt securities be presented as an allowance rather than as a write-down. The measurement of credit losses for newly recognized financial assets and subsequent changes in the allowance for credit losses are recorded in the statements of operations. The amendments in this update will be effective beginning January 1, 2020. The Company is currently in the process of evaluating the effects of the new guidance but does not expect the impact from this standard to be material.

3. REVENUE

Revenue Recognition

The Company enters into contracts that may include various product and service offerings, which are generally capable of being distinct and are accounted for as separate performance obligations.

Revenue is recognized upon the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

Shipping charges billed to customers are included in revenue and the related shipping costs are included in cost of revenue. Revenue is recorded net of taxes collected or accrued. Sales taxes are recorded as current liabilities until remitted to the relevant government authority.

The Company does not have any capitalized costs associated with contract acquisition because most direct contract acquisition costs relate to contracts that are recognized over a period of one year or less.

Arrangements with Multiple Performance Obligations

The Company’s contracts may contain multiple distinct performance obligations. The computed transaction price of each contract is allocated to each performance obligation based on a relative stand-alone selling price (“SSP”). For performance obligations routinely sold separately, the SSP is determined by evaluating such stand-alone sales. For those performance obligations that are not routinely sold separately, the Company determines SSP based on a market assessment approach, or on an expected cost-plus margin approach.

Nature of Products and Services

Platform Segment:

The Company’s platform segment generates revenue from advertising sales, subscription and transaction revenue shares, the sale of branded channel buttons on remote controls and licensing arrangements with TV brands and service operators.

Player Segment:

The Company sells the majority of its players through retail distribution channels in the U.S., including brick and mortar and online retailers, as well as through the Company’s website. The Company’s player revenue includes allowances for returns and sales incentives in the estimated transaction price. These estimates are based on historical experience and anticipated performance.

Revenue Disaggregation

The Company’s disaggregated revenue is represented by the two reportable segments discussed in Note 14. The disaggregation is based on the evaluations that are regularly performed by the chief operating decision maker (“CODM”) for purposes of allocating resources and evaluating financial performance. The Company’s CODM is its Chief Executive Officer.

Revenue Allocated to Future Performance Obligations

Revenue allocated to remaining performance obligations represents estimated contracted revenue that has not yet been recognized which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Estimated

contracted revenue was $105.2 million as of June 30, 2019 of which we expect to recognize approximately 81% over the next 12 months and the remainder thereafter.

In the three and six months ended June 30, 2019 the amount of platform revenue recognized from performance obligations satisfied, or partially satisfied, in prior reporting periods totaled $5.3 million.

Contract Balances

Contract balances include the following (in thousands):

	As of
	June 30, 2019		December 31, 2018
Accounts receivable, net	$	204,037	$	183,078
Contract assets (included in Prepaid expenses and other current assets)		2,016		753

Deferred revenue, current		36,536		45,442
Deferred revenue, non-current		13,889		19,594
Total deferred revenue	$	50,425	$	65,036

Accounts receivable are recorded at the amount invoiced, net of an allowance for doubtful accounts and sales incentives. Payment terms can vary by customer and contract.

The timing of revenue recognition may differ from the timing of invoicing to customers. Contract assets are created when invoicing occurs subsequent to revenue recognition. Contract assets are transferred to accounts receivable when the right to invoice becomes unconditional. Contract liabilities are included in deferred revenue and reflect consideration invoiced prior to the completion of performance obligations and revenue recognition.

Contract assets increased by approximately $1.3 million during the six months ended June 30, 2019 primarily due to an increase in the growth of platform revenue combined with the timing of billing which falls into a subsequent period. Deferred revenue decreased by approximately $14.6 million during the six months ended June 30, 2019 primarily due to revenue recognized of $5.0 million pursuant to customer acceptance of a milestone, revenue recognized of $5.3 million due to an increase in the estimated transaction prices of performance obligations satisfied in previous periods, and the remaining revenue recognized primarily relates to the timing of fulfillment of performance obligations.

4. Balance sheet components

Accounts Receivable, Net of allowances—Accounts receivable, net of allowances, consisted of the following (in thousands):

	June 30, 2019			December 31, 2018
Gross accounts receivable	$	218,296		$	204,975
Allowance for sales returns		(5,250	)		(7,335	)
Allowance for sales incentives		(8,583	)		(13,750	)
Other allowances		(426	)		(812	)
Total allowances		(14,259	)		(21,897	)
Total Accounts Receivable—net of allowances	$	204,037		$	183,078

Allowance for Sales Returns—Allowance for sales returns consisted of the following activities (in thousands):

	June 30, 2019			December 31, 2018
Beginning balance	$	(7,335	)	$	(6,907	)
Charged to revenue		(6,728	)		(17,396	)
Utilization of sales return reserve		8,813			16,968
Ending balance	$	(5,250	)	$	(7,335	)

Allowance for Sales Incentives—Allowance for sales incentives consisted of the following activities (in thousands):

	June 30, 2019			December 31, 2018
Beginning balance	$	(13,750	)	$	(10,442	)
Charged to revenue		(16,663	)		(50,958	)
Utilization of sales incentive reserve		21,830			47,650
Ending balance	$	(8,583	)	$	(13,750	)

Property and Equipment, Net—Property and equipment, net consisted of the following (in thousands):

	June 30, 2019			December 31, 2018
Computers and equipment	$	19,981		$	16,056
Leasehold improvements		39,293			18,396
Website and internal-use software		6,507			6,423
Office equipment and furniture		7,645			4,069
Total property and equipment		73,426			44,944
Accumulated depreciation and amortization		(25,024	)		(19,680	)
Property and Equipment, net	$	48,402		$	25,264

Depreciation and amortization expense, for property and equipment assets, for the three months ended June 30, 2019 and 2018 was $2.7 million and $1.8 million, respectively. Depreciation and amortization expense, for property and equipment assets, for the six months ended June 30, 2019 and 2018 was $5.4 million and $3.3 million, respectively.

Accounts Payable and Accrued Liabilities—Accounts payable and accrued liabilities consisted of the following (in thousands):

	June 30, 2019		December 31, 2018
Accounts payable	$	62,002	$	56,576
Accrued royalty expense		8,294		7,939
Accrued inventory		8,392		6,008
Accrued payroll and related expenses		14,816		12,217
Accrued cost of revenue		26,191		22,830
Payments due to content publishers		47,630		32,463
Operating lease liability, current		15,946		—
Customer prepayments		5,069		3,124
Taxes and related liabilities		840		1,314
Accrued legal fees		2,845		—
Other accrued expenses		9,707		6,091
Total Accounts Payable and Accrued Liabilities	$	201,732	$	148,562

Deferred Revenue—Deferred revenue consisted of the following (in thousands):

	June 30, 2019		December 31, 2018
Platform, current	$	17,873	$	28,569
Player, current		18,663		16,873
Total deferred revenue, current		36,536		45,442
Platform, non-current		7,192		12,783
Player, non-current		6,697		6,811
Total deferred revenue, non-current		13,889		19,594
Total Deferred Revenue	$	50,425	$	65,036

5. SHORT-TERM INVESTMENTS

The following is a summary of the Company’s short-term investments (in thousands):

	June 30, 2019								December 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Loss		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Loss			Fair Value
Corporate bonds and commercial paper	$	5,989	$	3	$	-	$	5,992	$	37,168	$	—	$	(17	)	$	37,151
U.S. government securities		4,994		1		—		4,995		4,995		—		—			4,995
Total Short-Term Investments	$	10,983	$	4	$	-	$	10,987	$	42,163	$	—	$	(17	)	$	42,146

Tax effects related to unrealized losses are not material for all periods presented.

The following table summarizes the maturities of the Company’s short-term investments by contractual maturity (in thousands):

	June 30, 2019				December 31, 2018
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Less than 1 year	$	10,983	$	10,987	$	42,163	$	42,146
Due in 1-3 years		—				—		—
Total Short-Term Investments	$	10,983	$	10,987	$	42,163	$	42,146

6. FAIR VALUE

We measure our financial assets and liabilities at fair value on a recurring basis. Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability in the principal market or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date.

The Company’s financial assets measured at fair value are as follows (in thousands):

	June 30, 2019						December 31, 2018
	Fair Value		Level 1		Level 2		Fair Value		Level 1		Level 2
Assets:
Cash and cash equivalents:
Cash	$	335,320	$	335,320	$	—	$	147,221	$	147,221	$	—
Money market funds		40,189		40,189		—		8,343		8,343		—
Restricted cash		868		868		—		—		—		—
Short-term investments:
Corporate bonds and commercial paper		5,992		—		5,992		37,151		—		37,151
U.S. government securities		4,995		—		4,995		4,995		—		4,995
Total assets measured and recorded at fair value	$	387,364	$	376,377	$	10,987	$	197,710	$	155,564	$	42,146

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs in measuring fair value, and to utilize a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows:

Level 1—Quoted prices in active markets for identical assets or liabilities.

The Company considers all highly liquid investments purchased with an original or remaining maturity of less than three months at the date of purchase to be cash equivalents. The Company measured money market funds of $40.2 million and $8.3 million as cash equivalents as of June 30, 2019 and December 31, 2018, respectively, using Level 1 inputs.

Level 2—Observable inputs other than quoted prices included within Level 1, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and inputs other

than quoted prices that are observable or are derived principally from, or corroborated by, observable market data by correlation or other means.

The Company measured its short-term investments using Level 2 inputs.

Level 3—Unobservable inputs that are supported by little or no market activity, are significant to the fair value of the assets or liabilities and reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

The Company did not use Level 3 inputs to measure any assets or liabilities as of June 30, 2019 and December 31, 2018.

7. LEASES

The Company determines if an arrangement contains a lease at its inception. ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term and leases are included in operating lease ROU assets, accrued liabilities, for the current portion of operating lease liabilities, and operating lease liabilities, non-current on our consolidated balance sheets. As the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future lease payments. The Company took into consideration its credit rating and the length of the lease when calculating the incremental borrowing rate. The Company considers the options to extend or terminate the lease in determining the lease term, when it is reasonably certain to exercise one of the options. The Company combines lease and non-lease components into a single lease component for its real estate and equipment leases.

The Company has entered into operating leases primarily for office real estate. The leases have remaining lease terms ranging from one year to 11 years. Some leases include an option to extend the leases for up to seven years and some leases include an option to terminate after three and a half years from the commencement date. The depreciable life of ROU assets is limited by the expected lease term.

The Company earns sublease income from subleases for a portion of the former headquarters. The subleases expire in 2020.

The components of lease expense are as follows (in thousands):

	Three Months Ended			Six Months Ended
	June 30, 2019			June 30, 2019
Operating lease cost	$	5,830		$	10,162
Sublease income		(546	)		(1,126	)
Net operating lease cost	$	5,284		$	9,036

Supplemental cash flow information related to leases is as follows (in thousands):

	Six Months Ended
	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	7,440
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	83,780

Supplemental balance sheet information related to leases was as follows (in thousands, except lease term and discount rate):

	As of
	June 30, 2019
Operating lease right-of-use assets	$	115,961
Included in accounts payable and accrued liabilities:
Operating lease liability, current		15,946
Operating lease liability, non-current		105,513
Total operating lease liability	$	121,459

Weighted Average Remaining Lease Term
Operating leases (in years)	9.14
Weighted Average Discount Rate
Operating leases		5.51	%

Future lease payments under operating leases as of June 30, 2019 were as follows (in thousands):

Year ending December 31,	Operating Leases
2019 (remaining 6 months)	$	9,753
2020		19,304
2021		21,946
2022		18,107
2023		18,448
Thereafter		97,240
Total future lease payments		184,798
Less: imputed interest		(39,960	)
Less: expected tenant improvement allowance		(23,379	)
Total	$	121,459

As of June 30, 2019, the Company has additional operating leases, primarily corporate offices, that have not yet commenced of $153.8 million. These operating leases will commence in fiscal years 2019 and 2020 with lease terms of 6 years to 11 years.

The following table summarizes the future minimum lease payments due under operating leases as of December 31, 2018 and reflect the application of the prior lease standard (ASC 840, Leases). These amounts were disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (in thousands):

Year ending December 31,	Operating Leases
2019	$	16,817
2020		29,124
2021		32,034
2022		32,844
2023		33,414
Thereafter		223,472
Less: sublease income		(3,711	)
Total	$	363,994

8. DEBT

The Company did not have any outstanding debt as of June 30, 2019 and December 31, 2018.

Senior Secured Term Loan A and Revolving Credit Facilities

On February 19, 2019 (the “Original Closing Date”), the Company entered into a Credit Agreement (the “Existing Credit Agreement”) with Morgan Stanley Senior Funding, Inc. On May 3, 2019, (the “Closing Date”), the Existing Credit Agreement was amended pursuant to an Incremental Assumption and Amendment No. 1 (the “Amendment” and the Existing Credit Agreement as amended by the Amendment, the “Credit Agreement”). The Amendment increased the level of new term loan commitments and new revolving commitments under the Credit Agreement by an aggregate amount of $50.0 million.

of up to $100.0 million (the “Term Loan A Facility”) and (iii) an uncommitted incremental facility, subject to the satisfaction of certain financial and other conditions, in the amount of up to (v) $50.0 million, plus (w) 1.0x of the Company’s EBITDA for the most recently completed four fiscal quarter period, plus (x) an additional amount at the Company’s discretion, so long as, on a pro forma basis at the time of incurrence, the Company’s secured leverage ratio does not exceed 1.50 to 1.00, plus (y) voluntary prepayments of the Revolving Credit Facility and Term Loan A Facility to the extent accompanied by concurrent reductions to the applicable Credit Facility, plus (z) for up to 90 days after the Original Closing Date, $25.0 million (together with the Revolving Credit Facility and the Term Loan A Facility, collectively, the “Credit Facility”). Borrowings under the Term Loan A Facility may be made by the Company up to nine months immediately following the Original Closing Date (the “Term Loan A Availability Period”). Each lender’s obligation to fund future loans or issue future letters of credit under the Credit Facility is subject to the satisfaction of certain conditions set forth in the Credit Agreement. On the Closing Date, the Company terminated its Restated 2014 LSA (as defined below) with Silicon Valley Bank.

Loans under the Credit Facility bear interest at a rate equal to, at the Company’s election, (i) an alternate base rate, based upon the highest of (x) the prime rate published by the Wall Street Journal, (y) the federal funds effective date plus ½ of 1% and (z) the one-month LIBOR plus 1%, in each case plus an applicable margin of up to 1% per annum, with step-downs based on its secured leverage ratio or (2) an adjusted one-, two-, three-, or six month LIBOR, at its election, plus an applicable margin of up to 2% per annum, with step-downs based on its secured leverage ratio.

Loans under the Term Loan A Facility will amortize in equal quarterly installments beginning on the last day of the fiscal quarter ending after the date of the initial borrowing under the Term Loan A Facility, in an aggregate annual amount equal to (i) on or prior to December 31, 2021, 1.25% of the drawn principal amount of the Term Loan Facility and (ii) thereafter, 2.50% of the drawn principal amount of the Term Loan Facility, with any remaining balance payable on the maturity date of the Term Loan A Facility.

The Company’s obligations under the Credit Agreement are secured by substantially all of its assets. In the future, certain of its direct and indirect subsidiaries may be required to guarantee the Credit Agreement. The Company may prepay, and in circumstances is required to prepay, loans under the Credit Agreement without payment of a premium. The Credit Agreement contains customary representations and warranties, customary affirmative and negative covenants, a financial covenant that is tested quarterly and requires the Company to maintain a certain adjusted quick ratio of at least 1.00 to 1.00, and customary events of default. As of June 30, 2019, the Company is in compliance with all the covenants of the Credit Agreement.

The Company incurred debt issuance costs for the Credit Agreement, which are amortized over the contractual term of the agreement. Debt issuance costs are recorded in prepaid expenses and other current assets on the condensed consolidated balance sheet.

Line of Credit with Silicon Valley Bank

The Company first entered into a loan and security agreement (the “LSA”) with Silicon Valley Bank in July 2011. The LSA was amended and restated in subsequent periods. The amended and restated loan and security agreement (the “Restated 2014 LSA”) entered into in November 2014 provided advances under a revolving line of credit up to $30.0 million and provided for letters of credit to be issued up to $5.0 million.

In June 2017, the Company entered into a second amendment to the Restated 2014 LSA (such amendment, the “Second Amendment”). Advances under the Second Amendment carry a floating per annum interest rate equal to, at the Company’s option, (1) the prime rate or (2) LIBOR plus 2.75%, or the prime rate plus 1% depending on certain ratios. The Second Amendment further changed the financial covenant to maintain a current ratio (calculated as current assets, divided by current liabilities less deferred revenue) greater than or equal to 1.25. As of December 31, 2018, the Company was in compliance with all of the covenants in the amended Restated 2014 LSA.

On July 18, 2018, the Company entered into a third amendment to the Restated 2014 LSA (such amendment, the “Third Amendment”). The Third Amendment increased the amount by which the Company could utilize its line of credit to support the issuances of letters of credits from $5.0 million to $30.0 million.

On February 19, 2019, the Company terminated the Restated 2014 LSA agreement with Silicon Valley Bank.

9. STOCKHOLDERS’ EQUITY

At-the-Market Offerings

On March 12, 2019, the Company entered into an Equity Distribution Agreement with Citigroup Global Markets Inc., as its sales agent, pursuant to which the Company could issue and sell from time-to-time up to $100.0 million maximum aggregate offering price of the Company’s Class A common stock. In March 2019, the Company received gross proceeds of $100.0 million from sales of approximately 1.4 million shares at an average selling price of $72.00 per share and incurred issuance costs of $2.0 million. As of March 31, 2019, the Company had sold all available shares of Class A common stock under this agreement.

On May 16, 2019, the Company entered into an Equity Distribution Agreement with Morgan Stanley & Co. LLC, as its sales agent, pursuant to which the Company could issue and sell up to 1.0 million shares of the Company’s Class A common stock. As of June 30, 2019, the Company received gross proceeds of $82.9 million from the sale of these 1.0 million shares at an average selling price of $82.90 per share and incurred issuance costs of $1.6 million.

Preferred Stock

The Company is authorized to issue 10 million shares of undesignated preferred stock with rights and preferences determined by the Company’s Board of Directors at the time of issuance.

As of June 30, 2019 and December 31, 2018, there were no shares of preferred stock issued and outstanding.

Common Stock

The Company has two classes of authorized common stock, Class A common stock and Class B common stock. All shares of common stock outstanding immediately prior to the initial public offering (“IPO”), including shares of common stock issued upon the conversion of the convertible preferred stock, were converted into an equivalent number of shares of Class B common stock. All common stock, stock options, and restricted stock units issued at the time of, and subsequent to, the IPO are exercised or vested into shares of Class A common stock.

The Company has reserved the following shares of common stock for future issuances (in thousands):

	As of
	June 30, 2019
Common stock awards granted under equity incentive plans		16,595
Common stock awards available for issuance under Employee Stock Purchase Plan		2,089
Common stock awards available for issuance under the 2017 Equity Incentive Plan		18,190
Total reserved shares of common stock		36,874

Equity Incentive Plans

The 2008 Equity Incentive Plan (the “2008 Plan”) became effective in February 2008. The 2008 Plan allowed for the grant of incentive stock options to employees and non-statutory stock options and restricted stock awards to employees, directors and consultants. Subject to certain limitations, options granted under the 2008 Plan were granted at a price per share equivalent to the fair market value on the date of grant and generally vest over four years and have a term of 10 years. Outstanding stock options granted under the 2008 Plan, prior to the Company’s IPO, are exercisable for Class B common stock. Following the Company’s IPO, no further equity awards could be made pursuant to the 2008 Plan.

The 2017 Equity Incentive Plan (the “2017 Plan”) became effective in September 2017. The 2017 Plan provides for the grant of incentive stock options to employees and for the grant of non-statutory stock options and restricted stock awards, as well as other forms of equity compensation to employees, directors and consultants. Stock options and restricted stock units under the 2017 Plan are generally expensed over four years and have a term of 10 years. Only shares of Class A common stock are issued pursuant to equity awards granted under the 2017 Plan.

Stock-Based Compensation

The Company measures the cost of awards granted under equity incentive plans based on the grant date fair value. The Company uses the straight-line method for expense recognition and recognizes forfeitures as they occur.

The following table shows total stock-based compensation expense for the three and six months ended June 30, 2019 and 2018 (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2019		June 30, 2018		June 30, 2019		June 30, 2018
Cost of platform revenue	$	59	$	19	$	118	$	38
Cost of player revenue		246		67		489		111
Research and development		9,258		2,801		17,790		5,097
Sales and marketing		4,974		1,286		10,140		2,396
General and administrative		4,134		1,136		7,998		2,096
Total stock-based compensation	$	18,671	$	5,309	$	36,535	$	9,738

Stock Options

The summary of the Company’s stock option activity is as follows (in thousands, except price per share data):

	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Weighted Average Grant Date Fair Value Per Share		Aggregate Intrinsic Value
Balance, December 31, 2018 - outstanding		16,371		$	8.59				—
Granted		26			80.25		—	$	28.95
Exercised		(3,625	)		5.37		—		—
Forfeited and expired		(339	)		8.39		—		—
Balance, June 30, 2019 - outstanding		12,433		$	9.68		6.5		—	$	1,005,879

Options exercisable at June 30, 2019		6,860		$	5.12		5.2		—	$	586,269

The intrinsic value for options exercised during the three months ended June 30, 2019 and 2018, was $135.8 million and $140.8 million, respectively, and during the six months ended June 30, 2019 and 2018 was $245.5 million and $197.0 million, respectively. Intrinsic value represents the difference between the fair values of the Company’s common stock and the exercise prices on the date of grant. As of June 30, 2019, the Company had $29.8 million of unrecognized stock compensation expense related to unvested stock options that is expected to be recognized over a weighted-average period of approximately 1.9 years.

The fair value of options granted under the equity incentive plans is estimated on the grant date using the Black-Scholes option-valuation model. The assumptions used in the Black-Scholes model are as follows:

	Three Months Ended					Six Months Ended
	June 30, 2019			June 30, 2018		June 30, 2019			June 30, 2018
Dividend rate		—			—		—			—
Expected term (in years)	5.0 - 5.27			5.3 - 6.1		5.0 - 5.27			5.3 - 6.1
Risk-free interest rate	1.83 - 2.31%			2.61 - 2.88%		1.83 - 2.56%			2.32 - 2.88%
Expected volatility		36	%	38 - 39%			36	%	38 - 40%

Restricted Stock Units

Pursuant to the 2017 Plan, the Company grants restricted stock units to employees. The fair value of restricted stock units is based on the Company’s closing stock price on the date of grant. The summary of the Company’s restricted stock unit activity is as follows (in thousands, except price per share data):

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
Balance, December 31, 2018 - outstanding		3,686		$	48.50
Awarded		1,081			57.36
Released		(381	)		46.16
Forfeited		(224	)		53.46
Balance, June 30, 2019 - outstanding		4,162		$	50.75

The unrecognized compensation cost related to restricted stock units as of June 30, 2019 was $189.1 million, which the Company expects to recognize over 3.0 years. The intrinsic value of restricted stock units that vested during the three months ended June 30, 2019 and 2018 was $19.4 million and $0.3 million, respectively, and during the six months ended June 30, 2019 and 2018 was $30.8 million and $0.3 million, respectively, which represented the fair value of the Company’s common stock underlying the restricted stock units on their vesting date.

10. COMMITMENTS AND CONTINGENCIES

Outstanding Commitments

The Company has contracts with vendors for the manufacture of inventory and related items. The Company also has contracts with content providers and other vendors for content licensing and advertising buys in the normal course of business. As of June 30, 2019, the Company had $52.8 million purchase commitments for inventory and related items and $75.9 million for content licensing, advertising buys and other platform services.

The Company records a liability for noncancelable purchase commitments in excess of its future demand forecasts. The amounts recorded by the Company for these purchase commitments were $0.4 million and $0.1 million as of June 30, 2019 and December 31, 2018, respectively.

Content Licensing

The Company licenses certain content for users to access through The Roku Channel. The Company records an obligation for licensing of content when it enters into an agreement to obtain future titles and the cost of the content is known. Certain agreements include the obligation to license rights for unknown future titles, the ultimate quantity and/or fees for which are not yet determinable as of the reporting date. As of June 30, 2019, the amounts recorded in “Accrued liabilities” for license purchase commitments were not material.

Letters of Credit

As of June 30, 2019 and December 31, 2018, the Company had irrevocable letters of credit outstanding in the amount of $31.3 million, related to facilities leases. The letters of credit have various expiration dates through 2030.

Contingencies

The Company accrues for loss contingencies, including liabilities for intellectual property licensing, when it believes such losses are probable and reasonably estimable.

The Company is currently involved in, and may in the future be involved in, legal proceedings, claims, and investigations in the ordinary course of business, including claims for infringing patents, copyrights or other intellectual property rights related to its platform and products, or the content distributed through its platform by the Company or third-party channel developers. Although the results of these proceedings, claims, and investigations cannot be predicted with certainty, the Company does not believe that the final outcome of any matters that it is currently involved in are reasonably likely to have a material adverse effect on its business, financial condition, or results of operations.

Indemnification

Many of the Company’s agreements include provisions for indemnifying content publishers, licensees, distributors, retailers, contract manufacturers and suppliers in the event that the Company’s products or services or the Company’s technologies incorporated therein, infringe on a third party’s intellectual property rights. It is not possible to determine the maximum potential amount under these indemnification obligations due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each agreement. To date, the Company has not incurred any material costs as a result of such obligations and has not accrued any liabilities related to such obligations in the consolidated financial statements.

11. INCOME TAXES

Income tax benefit for the three months ended June 30, 2019 and 2018 was $0.4 million, and income tax benefit for the six months ended June 30, 2019 and 2018 was $0.5 million and $0.2 million, respectively. The income tax benefit for the three and six months ended June 30, 2019 and 2018, was primarily attributable to non-U.S. tax benefit associated with the Company's non-U.S. operation. Based on the available objective evidence during the three months ended June 30, 2019, the Company believes it is more likely than not that the tax benefits of the U.S. losses incurred may not be realized. Accordingly, the Company recorded a full valuation allowance against the tax benefits of the U.S. losses incurred. The primary difference between the effective tax rate and the statutory tax rate relates to the valuation allowance on the Company’s U.S. losses.

A valuation allowance is provided when it is more likely than not that some portion of the deferred tax assets will not be realized through future operations. As a result of the Company’s analysis of all available objective evidence, both positive and negative, as of June 30, 2019, management believes it is more likely than not that the deferred tax assets will not be fully realizable. Accordingly, the Company has provided a full valuation allowance against its deferred tax assets with the exception of deferred tax assets related to foreign entities in the U.K., China, and Denmark.

12. RELATED-PARTY TRANSACTIONS

The Company has transactions with one of the Company’s strategic investors. With respect to this investor, the Company recorded revenue of $2.0 million and $0.7 million for the three months ended June 30, 2019 and 2018, respectively, and $4.6 million and $1.7 million for the six months ended June 30, 2019 and 2018, respectively. The Company had accounts receivable balance of $3.1 million and $2.4 million as of June 30, 2019 and December 31, 2018, respectively, related to transaction with this investor. The Company incurred expenses of $0.6 million and $0.2 million with this investor for the three months ended June 30, 2019 and 2018, respectively, and $1.1 million and $0.2 million for the six months ended June 30, 2019 and 2018, respectively. The Company had a payable of $0.5 million and $1.5 million to this investor as of June 30, 2019 and December 31, 2018, respectively.

13. NET INCOME (LOSS) PER SHARE

The Company’s basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding for the period. For purposes of the calculation of diluted net income (loss) per share options to purchase common stock, restricted stock units and unvested shares of common stock issued upon the early exercise of stock options are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share as their effect is antidilutive.

The following table presents the calculation of basic and diluted net income (loss) per share (in thousands, except per share data):

	Three Months Ended					Six Months Ended
	June 30, 2019			June 30, 2018		June 30, 2019			June 30, 2018
Numerator:
Net income (loss)	$	(9,333	)	$	526	$	(19,065	)	$	(6,108	)
Denominator:
Weighted-average shares used in computing net income (loss) per share, basic and diluted		114,572			102,652		112,734			101,079
Net income (loss) per share, basic and diluted	$	(0.08	)	$	0.01	$	(0.17	)	$	(0.06	)

Weighted-average shares used in computing net income (loss) per share, diluted		114,572			121,698		112,734			101,079
Net income (loss) per share, diluted	$	(0.08	)	$	0.00	$	(0.17	)	$	(0.06	)

Common shares that would be excluded from the calculation of diluted net loss per share because of their anti-dilutive effect are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30, 2019		June 30, 2018		June 30, 2019		June 30, 2018
Equity awards to purchase common stock		16,595		1,062		16,595		21,485
Unvested shares of common stock issued upon early exercise of stock options and business acquisition		45		—		45		105
Total		16,640		1,062		16,640		21,590

14. SEGMENT INFORMATION

The Company is organized into two reportable segments as follows:

Platform—Consists primarily of fees received from advertising sales, subscription and transaction revenue shares, sales of branded channel buttons on remote controls and licensing arrangements with TV brands and service operators. The Company’s first-party video ad inventory includes native display ads on home screens and screen savers as well as ad inventory obtained through content publisher agreements. To supplement supply, the Company can re-sell video inventory purchased from content publishers and, to a lesser extent, directly sell third-party inventory on a revenue share basis.

Player—Consists primarily of net sales of streaming media players and accessories through retailers and distributors, as well as directly to customers through the Company’s website.

Customers accounting for 10% or more of segment revenue were as follows:

	Three Months Ended						Six Months Ended
	June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Platform segment revenue
Customer D	*			*				10	%	*
Customer G	*			*			*				10	%

Player segment revenue
Customer A		14	%		16	%		16	%		14	%
Customer B		17	%		10	%		19	%		14	%
Customer C		40	%		39	%		38	%		38	%

*	Less than 10% of segment revenue

Substantially all of the Company’s assets were held in the United States and were attributable to the operations in the United States as of June 30, 2019 and December 31, 2018. Revenue in international markets was less than 10% for the three and six months ended June 30, 2019 and for the three months ended June 30, 2018 and was 10% for the six months ended June 30, 2018.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018, filed on March 1, 2019, with the SEC.

Overview

Roku pioneered streaming to the TV and we are capitalizing on this large economic opportunity as a leading TV streaming platform for users, content publishers and advertisers. Roku connects users to the streaming content they love, enables content publishers to build and monetize large audiences, and provides advertisers with unique capabilities to engage consumers. As of June 30, 2019, we had 30.5 million active accounts, an increase of 39% from June 30, 2018. In the three months ended June 30, 2019, our users streamed 9.4 billion hours an increase of 72% over hours streamed in the three months ended June 30, 2018. In the six months ended June 30, 2019, our users streamed 18.3 billion hours an increase of 73% over hours streamed in the six months ended June 30, 2018.

Our business model is to grow gross profit by increasing the number of active accounts and related streaming hours, and growing revenue through the monetization of our streaming platform. We measure our platform monetization progress through average revenue per user (“ARPU”), a measure that reflects the value of our business. We grow new accounts by selling streaming players; partnering with TV brands through our Roku TV licensing program; and licensing relationships with service operators.

We generate platform revenue primarily from advertising, content distribution and billing services on our platform and player revenue primarily from the sale of streaming players. We generated revenue of $250.1 million and $456.8 million during the three and six months ended June 30, 2019, respectively, up by 59% and 56%, respectively, as compared to the three and six months ended June 30, 2018. During the three and six months ended June 30, 2019, we generated gross profit of $114.2 million and $215.1 million, respectively, which is up 47% and 53%, respectively, from the three and six months ended June 30, 2018.

We continue to manage the average selling prices (“ASP”) of our streaming players to grow our active accounts. As a result, player revenue and gross profit may not increase as rapidly as they have historically or at all. We expect that tradeoffs from player gross profit to grow active accounts will result in increased platform monetization and gross profit.

Key Performance Metrics

We use the following key performance metrics to evaluate our business, measure our performance, develop financial forecasts and make strategic decisions. Our key performance metrics are gross profit, active accounts, hours streamed, and ARPU.

Gross Profit

We measure the performance of our business using gross profit. The majority of our gross profit is generated from platform revenue. We believe gross profit is the primary metric to measure the performance of our business because we have two revenue segments with different margin profiles and we aim to maximize our high margin platform revenue from our active accounts as they stream content on our platform.

Active Accounts

We define active accounts as the number of distinct user accounts that have streamed content on our platform within the last 30 days of the period. Users that streamed content from The Roku Channel only on non-Roku platforms are not included in this metric. The number of active accounts also does not correspond to the number of unique individuals who actively utilize our platform, or the number of devices associated with an account. For example, a single account may be used by more than one individual, such as a family, and one account may be used on multiple devices. We believe that the number of active accounts is a relevant measure to gauge the size of our user base.

Hours Streamed

We define hours streamed as the aggregate amount of time our streaming devices stream content on our platform in a given period. Streaming hours on non-Roku platforms are not included in this metric. We report hours streamed on a calendar basis. We believe the number of streaming hours on our platform is an effective measure of user engagement and that the growth in the number of hours of content streamed across our platform reflects our success in addressing the growing user demand for TV streaming.

Additionally, we believe increasing user engagement on our streaming platform increases our gross profit because we earn platform revenue from advertising as well as from revenue shares from subscription and transactional video on-demand. However, our revenue from content providers are not tied to the hours streamed on their streaming channels, and the number of hours streamed does not correlate to revenue earned from such content providers or ARPU on a period-by-period basis. Moreover, streaming hours on our platform are measured whenever a Roku player or a Roku TV is streaming content, whether a viewer is actively watching or not. For example, if a Roku player is connected to a TV, and the viewer turns off the TV, steps away or falls asleep and does not stop or pause the player then the particular streaming channel may auto-play subsequent content for a period of time determined by the streaming channel. We believe that this also occurs across a wide variety of non-Roku streaming devices and other set-top boxes.

Average Revenue per User

We measure platform monetization progress with ARPU. We define ARPU as our platform revenue for the trailing four quarters divided by the average of the number of active accounts at the end of the current period and the end of the corresponding period in the prior year. ARPU measures the rate at which we are monetizing our active account base and the progress of our platform business. Our average revenue per user was $21.06 at June 30, 2019 as compared to $16.60 at June 30, 2018, representing 27% growth.

Components of Results of Operations

Revenue

Platform Revenue

We generate platform revenue from advertising sales, subscription and transaction revenue shares, sales of branded channel buttons on remote controls and licensing arrangements with TV brands and service operators. Our first-party video ad inventory includes native display ads on our home screen and screen saver as well as ad inventory we obtain through our content publisher agreements. To supplement our supply, we can re-sell video inventory that we purchase from content publishers and, to a lesser extent, directly sell third-party inventory on a revenue share basis. To date we generate most of our platform revenue in the United States.

Player Revenue

We generate player revenue primarily from the sale of streaming players through consumer retail distribution channels, including major brick and mortar retailers, such as Best Buy and Walmart, and online retailers, primarily Amazon. We generate most of our player revenue in the United States. In our international markets, we sell our players through wholesale distributors which, in turn, re-sell to retailers. We currently distribute our players in Canada, the United Kingdom, France, the Republic of Ireland, Mexico and several other Latin American countries. We introduced wireless speakers in 2018 that work with Roku TVs to enhance the user experience.

Cost of Revenue

Cost of Platform Revenue

Cost of platform revenue consists of advertising inventory acquisition costs, payment processing fees, third-party cloud service fees, content licensing fees and allocated personnel-related costs, including salaries, benefits and stock-based compensation for Roku personnel who support platform services.

Cost of Player Revenue

Cost of player revenue is comprised of player manufacturing costs payable to our third-party contract manufacturers, technology licenses or royalty fees, inbound and outbound freight, duty and logistics costs, third-party packaging and assembly costs, provision for excess or obsolete inventory, allocated overhead costs related to facilities and customer support, and salary, benefit and stock-based compensation costs for operations personnel.

Operating Expenses

Research and Development

Research and development expenses consist primarily of personnel-related costs, including employee salaries, benefits and stock-based compensation for our engineers and other employees engaged in the development of our products including new technologies, features and functionality and fees for outsourced consulting services. In addition, research and development expenses

include allocated facilities and overhead costs. We believe continued investment is important to attaining our strategic objectives and expect research and development expenses to increase in absolute dollars for the foreseeable future.

Sales and Marketing

Sales and marketing expenses consist primarily of personnel-related costs, including salaries, benefits, commissions and stock-based compensation expense for our employees engaged in sales and sales support, data science and analytics, business development, product management, marketing, communications, and partner and customer support functions. Sales and marketing expenses also include expenses for public relations, distribution fees, channel merchandising, including point of purchase and in-store displays, trade shows and other events, professional services, and allocated facilities and other overhead. We expect our sales and marketing expenses to increase as we continue to grow our business.

General and Administrative

General and administrative expenses consist primarily of personnel-related costs, including salaries, benefits and stock-based compensation for our executive, finance, legal, information technology, human resources and other administrative personnel. We expect our general and administrative expenses to increase due to the anticipated growth of our business and related infrastructure, compliance with global laws and regulations, as well as accounting, legal, insurance, investor relations and other costs associated with being a public company.

Other Income (Expense), Net

Our other income (expense), net, for the three and six months ended June 30, 2019, consists of interest income on short-term investments and foreign currency re-measurement and transaction gains and losses. The other income (expense), net, for the three and six months ended June 30, 2018 consisted of foreign currency re-measurement and transaction gains and losses.

Income Tax Expense

Our income tax expense consists primarily of income taxes in certain foreign jurisdictions where we conduct business and state minimum income taxes in the United States. We have a valuation allowance for deferred tax assets, including net operating loss carryforwards and tax credits related primarily to research and development. We expect to maintain this valuation allowance for the foreseeable future.

Results of Operations

The following table sets forth our results of operations as a percentage of net revenue.

	Three Months Ended						Six Months Ended
	June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Net Revenue:
Platform		67	%		58	%		66	%		56	%
Player		33	%		42	%		34	%		44	%
Total net revenue		100	%		100	%		100	%		100	%
Cost of Revenue:
Platform		23	%		17	%		22	%		17	%
Player		31	%		33	%		31	%		35	%
Total cost of revenue		54	%		50	%		53	%		52	%
Gross Profit:
Platform		44	%		41	%		45	%		40	%
Player		2	%		9	%		2	%		8	%
Total gross profit		46	%		50	%		47	%		48	%
Operating Expenses:
Research and development		25	%		26	%		26	%		25	%
Sales and marketing		15	%		14	%		15	%		15	%
General and administrative		10	%		10	%		11	%		11	%
Total operating expenses		50	%		50	%		52	%		51	%
Loss from Operations		(4	)%		—	%		(5	)%		(3	)%
Other Income, Net:
Interest expense		—	%		—	%		—	%		—	%
Other income, net		—	%		—	%		—	%		—	%
Total other income, net		—	%		—	%		—	%		—	%
Income (Loss) before income taxes		(4	)%		—	%		(5	)%		(3	)%
Net income (loss) attributable to common stockholders		(4	)%		—	%		(5	)%		(3	)%

Comparison of Three and Six Months Ended June 30, 2019 and June 30, 2018

Net Revenue

	Three Months Ended							Six Months Ended
	June 30, 2019		June 30, 2018		Change $		Change %	June 30, 2019		June 30, 2018		Change $		Change %
(in thousands, except percentages)
Platform	$	167,682	$	90,341	$	77,341	86%	$	301,835	$	165,418	$	136,417	82%
Player		82,419		66,469		15,950	24%		154,928		127,968		26,960	21%
Total Net Revenue	$	250,101	$	156,810	$	93,291	59%	$	456,763	$	293,386	$	163,377	56%

Platform

Platform revenue increased by $77.3 million, or 86%, during the three months ended June 30, 2019 compared to the three months ended June 30, 2018. The increase derives from $74.6 million of higher advertising and content distribution revenue, including subscription and transaction revenue shares, and $2.8 million from licensing arrangements.

Platform revenue increased by $136.4 million, or 82%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. The increase derives from $144.0 million of higher advertising and content distribution revenue, including subscription and transaction revenue shares. The increase was partially offset by a $7.4 million decrease in revenue from licensing arrangements, mainly driven by the delivery of intellectual property to a licensing partner during the first quarter of 2018 that did not reoccur in 2019.

Player

Player revenue increased by $16.0 million, or 24%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018, as the volume of player units sold increased 36% as compared to the three months ended June 30, 2018 offset by a 10% decrease in the average selling price of players. Revenue generated from the sale of audio products which launched in the fall of 2018 is included in player revenue and is not significant.

Player revenue increased by $27.0 million, or 21%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. During the six months ended June 30, 2019, the volume of players sold increased 29% as compared to the six months ended June 30, 2018 offset by a 9% decrease in the average selling price of players. Revenue generated from the sale of audio products which launched in the fall of 2018 is included in player revenue and is not significant.

Cost of Revenue and Gross Profit

	Three Months Ended								Six Months Ended
	June 30, 2019		June 30, 2018		Change $			Change %	June 30, 2019		June 30, 2018		Change $			Change %
(in thousands, except percentages)
Cost of revenue:
Platform	$	57,980	$	27,328	$	30,652		112%	$	98,344	$	48,994	$	49,350		101%
Player		77,912		51,730		26,182		51%		143,319		103,528		39,791		38%
Total Cost of Revenue	$	135,892	$	79,058	$	56,834		72%	$	241,663	$	152,522	$	89,141		58%
Gross profit:
Platform	$	109,702	$	63,013	$	46,689		74%	$	203,491	$	116,424	$	87,067		75%
Player		4,507		14,739		(10,232	)	(69)%		11,609		24,440		(12,831	)	(53)%
Total Gross Profit	$	114,209	$	77,752	$	36,457		47%	$	215,100	$	140,864	$	74,236		53%

Platform

Cost of platform revenue increased by $30.7 million, or 112%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018. This increase is a result of higher advertising inventory acquisition costs, ad serving costs, content licensing fees and credit card processing fees totaling $28.1 million and a $2.2 million increase in allocated overhead primarily in advertising and platform support.

Cost of platform revenue increased by $49.4 million, or 101%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. This increase is a result of higher advertising inventory acquisition costs, ad serving costs, content licensing fees and credit card processing fees totaling $47.1 million and a $2.0 million increase in allocated overhead primarily in advertising operations and content distribution operations driven by the growth of the platform business.

Gross profit on platform revenue increased by $46.7 million, or 74%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018, driven by an 86% increase in platform revenue offset by a 112% increase in platform costs.

Gross profit on platform revenue increased by $87.1 million, or 75%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018, driven by an 82% increase in platform revenue offset by a 101% increase in platform costs.

Player

Cost of player revenue increased by $26.2 million, or 51%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018. The cost of player revenue increased approximately $14.7 million due to an increase in manufacturing costs to support a higher volume of players sold. In addition, royalty expenses increased $11.5 million of which $8.9 million related to the release of accruals in the second quarter of 2018 pursuant to a potential intellectual property liability that did not materialize and $2.0 million accrued in the current quarter related to a separate intellectual property claim.

Cost of player revenue increased by $39.8 million, or 38%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. The cost of player revenue increased approximately $26.0 million due to an increase in manufacturing costs to support a higher volume of players sold. In addition, royalty expenses increased $12.0 million of which $8.9 million related to the release of accruals in the second quarter of 2018 pursuant to a potential intellectual property liability that did not materialize and $2.0 million accrued in the current quarter related to a separate intellectual property claim and freight costs increased $1.7 million.

Gross profit on player sales decreased by $10.2 million, or 69%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018 primarily due to the royalty transactions described above. Excluding the effect of these royalty

transactions, gross profit would have increased approximately $0.7 million which reflects the decrease in the average selling prices of players and increases in manufacturing costs.

Gross profit on player sales decreased by $12.8 million, or 53%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018, primarily due to the royalty transactions described above. Excluding the effect of these royalty transactions, gross profit would have decreased approximately $1.9 million which reflects the decrease in the average selling prices of players and increases in manufacturing and logistics costs.

Operating Expenses

	Three Months Ended							Six Months Ended
	June 30, 2019		June 30, 2018		Change $		Change %	June 30, 2019		June 30, 2018		Change $		Change %
(in thousands, except percentages)
Research and development	$	61,994	$	40,196	$	21,798	54%	$	117,732	$	74,322	$	43,410	58%
Sales and marketing		36,568		22,259		14,309	64%		70,375		42,577		27,798	65%
General and administrative		26,033		15,429		10,604	69%		48,119		30,999		17,120	55%
Total Operating Expenses	$	124,595	$	77,884	$	46,711	60%	$	236,226	$	147,898	$	88,328	60%

Research and Development

Research and development expenses increased by $21.8 million, or 54%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018. The increase was primarily due to higher personnel-related costs of $17.2 million as a result of increased engineering headcount and the value of stock-based compensation, higher facilities costs of $2.3 million and higher platform and product development costs of $2.3 million that includes expenses such as consulting and outside services, travel and equipment partially offset by allocation of overheads to player and platform costs.

Research and development expenses increased by $43.4 million, or 58%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. The increase was primarily due to higher personnel-related costs of $34.3 million as a result of increased engineering headcount and the value of stock-based compensation, higher facilities costs of $4.1 million and higher platform and product development costs of $5.0 million that includes expenses such as consulting and outside services, travel and equipment partially offset by allocation of overheads to player and platform costs.

Sales and Marketing

Sales and marketing expenses increased by $14.3 million, or 64%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018. The increase was primarily due to higher personnel-related costs of $10.1 million related to increased headcount to support our growth in platform revenue, mainly in advertising and content distribution, and the value of stock-based compensation, an increase of $1.9 million increase in marketing and distribution fees, and an increase in other expenses of $2.2 million that includes facilities costs, consulting services and travel.

Sales and marketing expenses increased by $27.8 million, or 65%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. The increase was primarily due to higher personnel-related costs of $19.4 million related to increased headcount to support our growth in platform revenue, mainly in advertising and content distribution, and the value of stock-based compensation, an increase of $3.9 million increase in marketing and distribution fees, and an increase in other expenses of $4.5 million that includes facilities costs, consulting services and travel.

General and Administrative

General and administrative expenses increased by $10.6 million, or 69%, during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018. The increase was primarily due to higher personnel-related costs of $6.0 million as a result of increased headcount in general and administrative functions and the value of stock-based compensation and $5.0 million primarily related to increased legal and other outside consulting and professional service fees.

General and administrative expenses increased by $17.1 million, or 55%, during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018. The increase was primarily due to higher personnel-related costs of $11.4 million as a result of increased headcount in general and administrative functions and the value of stock-based compensation and $6.2 million primarily related to increased legal and other outside consulting and professional service fees.

Other Income, Net

	Three Months Ended										Six Months Ended
	June 30, 2019			June 30, 2018			Change $			Change %	June 30, 2019			June 30, 2018			Change $			Change %
(in thousands, except percentages)
Interest expense	$	(571	)	$	(57	)	$	(514	)	902%	$	(669	)	$	(108	)	$	(561	)	519%
Other income, net		1,240			361			879		243%		2,207			809			1,398		173%
Total Other Income, Net	$	669		$	304		$	365		120%	$	1,538		$	701		$	837		119%

Other income, net, increased by $0.4 million during the three months ended June 30, 2019 as compared to the three months ended June 30, 2018 primarily due to an increase in interest income from short-term investments.

Other income, net, increased by $0.8 million during the six months ended June 30, 2019 as compared to the six months ended June 30, 2018 primarily due to an increase in interest income from short-term investments.

Income Tax (Benefit)

	Three Months Ended										Six Months Ended
	June 30, 2019			June 30, 2018			Change $			Change %	June 30, 2019			June 30, 2018			Change $			Change %
(in thousands, except percentages)
Income Tax (Benefit)	$	(384	)	$	(354	)	$	(30	)	8%	$	(523	)	$	(225	)	$	(298	)	132%

Income tax (benefit) arises from foreign income taxes and state minimum income taxes in the United States.

Liquidity and Capital Resources

As of June 30, 2019, we had cash, cash equivalents and short-term investments of $386.5 million. Our primary source of liquidity is cash generated through operating and financing activities, including sales of our securities. Our primary uses of cash include operating expenses such as personnel-related expenses and capital spending. Our future capital requirements may vary materially from those currently planned and will depend on many factors including our growth rate and the continuing market acceptance of our advertising platform, operating system and technology and players along with the timing and effort related to the introduction of new platform features, players, hiring of experienced personnel, the expansion of sales and marketing activities, as well as overall economic conditions. We entered into lease agreements for new corporate headquarters, as well as other office locations. We have incurred, and will continue to incur, material expenses in 2019 and expect to continue to incur material expenses in future years for facility and related building costs. We may also contemplate and engage in merger and acquisition activity that could materially impact our liquidity and capital resource position. However, we believe that our existing cash balances and cash flow from operations, together with amounts available under our Credit Agreement and Revolving Credit Facility, will be sufficient to fund our working capital and meet our anticipated cash needs for the foreseeable future.

As of June 30, 2019, approximately 1% of our cash was held outside the United States. These amounts were primarily held in Europe and are utilized to fund our foreign operations. The amount of unremitted earnings related to our foreign subsidiaries is not material.

At-the-Market Offerings

On March 12, 2019, we entered into an Equity Distribution agreement with Citigroup Global Markets Inc., as our sales agent, pursuant to which we could issue and sell from time-to-time shares of Class A common stock for aggregate gross proceeds of up to $100.0 million. In March 2019, we sold approximately 1.4 million shares of Class A common stock at an average selling price of $72.00 per share for aggregate gross proceeds of $100.0 million and incurred issuance costs of $2.0 million. As of March 31, 2019, we had sold all available shares of Class A common stock under the Equity Distribution Agreement.

On May 16, 2019, we entered into an Equity Distribution agreement with Morgan Stanley & Co. LLC, as our sales agent, pursuant to which we could issue and sell up to 1.0 million shares of Class A common stock. As of June 30, 2019, we received gross proceeds of $82.9 million from the sales of these 1.0 million shares at an average selling price of $82.90 per share and incurred issuance costs of $1.6 million.

Senior Secured Term Loan A and Revolving Credit Facilities

On February 19, 2019 (the “Original Closing Date”), we entered into a Credit Agreement (the “Existing Credit Agreement”) with Morgan Stanley Senior Funding, Inc. (“MSSF”). On May 3, 2019, (the “Closing Date”), the Existing Credit Agreement was amended pursuant to an Incremental Assumption and Amendment No. 1 (the “Amendment” and the Existing Credit Agreement as amended by the Amendment, the “Credit Agreement”). The Amendment increased the level of new term loan commitments and new revolving commitments under the Credit Agreement by an aggregate amount of $50.0 million.

The Credit Agreement now provides for (i) a four-year revolving credit facility in the aggregate principal amount of up to $100.0 million (the “Revolving Credit Facility”), (ii) a four-year delayed draw term loan A facility in the aggregate principal amount of up to $100.0 million (the “Term Loan A Facility”) and (iii) an uncommitted incremental facility, subject to the satisfaction of certain financial and other conditions, in the amount of up to (v) $50.0 million, plus (w) 1.0x of our consolidated EBITDA for the most recently completed four fiscal quarter period, plus (x) an additional amount at our discretion, so long as, on a pro forma basis at the time of incurrence, our secured leverage ratio does not exceed 1.50 to 1.00, plus (y) voluntary prepayments of the Revolving Credit Facility and Term Loan A Facility to the extent accompanied by concurrent reductions to the applicable Credit Facility, plus (z) for up to 90 days after the Original Closing Date, $25.0 million (together with the Revolving Credit Facility and the Term Loan A Facility, collectively, the “Credit Facility”). Borrowings under the Term Loan A Facility may be made by us up to nine months immediately following the Original Closing Date (the “Term Loan A Availability Period”). Each lender’s obligation to fund future loans or issue future letters of credit under the Credit Facility is subject to the satisfaction of certain conditions set forth in the Credit Agreement.

Loans under the Credit Facility bear interest at a rate equal to, at our election (i) an alternate base rate, based upon the highest of (x) the prime rate published by the Wall Street Journal, (y) the federal funds effective date plus ½ of 1% and (z) the one-month LIBO rate plus 1.00%, in each case plus an applicable margin of up to 1.00% per annum, with step-downs based on our secured leverage ratio or (ii) an adjusted one-, two-, three-, or six month LIBO rate, at our election, plus an applicable margin of up to 2.00% per annum, with step-downs based on our secured leverage ratio.

The Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, among other things, restrictions on indebtedness, liens, limitations on restrictive agreements, fundamental changes and business activities, investments, mergers, dispositions, transactions with affiliates, prepayment of other indebtedness and dividends and other distributions. The Credit Agreement also contains a financial covenant requiring us to maintain a minimum adjusted quick ratio of at least 1.00 to 1.00, tested as of the last day of any fiscal quarter.

As of June 30, 2019, we were in compliance with all the covenants of the Credit Agreement and there were no outstanding borrowings.

Cash Flows

The following table summarizes our cash flows for the periods presented (in thousands):

	Six Months Ended
	June 30, 2019		June 30, 2018
Consolidated Statements of Cash Flows Data:
Cash flows provided by (used in) operating activities	$	14,034	$	(11,468	)
Cash flows provided by (used in) investing activities		8,274		(9,013	)
Cash flows provided by financing activities		198,505		17,398

Operating Activities

Our operating activities provided cash of $14.0 million for the six months ended June 30, 2019. Our net loss of $19.1 million for the six months ended June 30, 2019 was adjusted by non-cash charges of $42.4 million comprising mainly of $36.5 million of stock-based compensation and $5.7 million of depreciation and amortization primarily on property and equipment. The changes in our operating assets and liabilities used cash of $9.3 million comprised of outflows of $21.0 million from an increase in accounts receivable as a result of increased revenues, $14.6 million from a decrease in deferred revenue, $5.4 million from an increase in prepaid and other current assets due to an increase in furniture deposits for our new headquarters, $4.4 million from payments related to operating lease liabilities, and $3.9 million from an increase in inventory balances. These outflows were partially offset by cash inflows of $32.3 million from an increase in accounts payable and accrued liabilities due to timing of payments and increased developer payables, and $7.7 million from amortization of operating lease right-of-use assets.

Our operating activities used cash of $11.5 million for the six months ended June 30, 2018. Our net loss of $6.1 million for the six months ended June 30, 2018 was adjusted by non-cash charges of $14.0 million comprising mainly of $3.6 million of depreciation and amortization, $9.7 million of stock-based compensation, $0.4 million relating to loss incurred on exiting facilities and $0.3 million of provision related to doubtful accounts. The changes in our operating assets and liabilities used cash of $19.4 million comprising of outflows of $19.0 million from decrease in accounts payable and accrued liabilities due to the timing of payments, $3.4 million from decrease in deferred revenues resulting from the adoption of the new revenue standard and $6.8 million from increase in inventory balance from increasing inventory levels from its low point at the end of 2017 holiday season. These outflows were offset by cash inflows from of $9.4 million from decrease in accounts receivable as a result of collections from higher revenues recorded in the last quarter of 2017 holiday season and $2.0 million from decrease in cost of deferred revenues.

Investing Activities

Our investing activities for the six months ended June 30, 2019 included cash inflow of $43.8 million received from the sales/maturities of short-term investments, partially offset by $23.2 million for the purchase of property and equipment, expenditures on leasehold improvements related to expanding our facilities and other capital investments, and $12.4 million for the purchase of short-term investments.

Our investing activities for the six months ended June 30, 2018 included cash outflow of $9.0 million spent on purchase of property and equipment, expenditure on leasehold improvements related to expanding our facilities and other capital investments.

Financing Activities

Our financing activities provided cash of $198.5 million for the six months ended June 30, 2019. The cash was received mainly from net proceeds from the issuance of common stock through our at-the-market programs amounting to $179.4 million, net of offering costs and the exercise of employee stock options of $19.1 million.

Our financing activities provided cash of $17.4 million for the six months ended June 30, 2018. The cash was received mainly from the exercise of employee stock options reflecting the expiry in March 2018 of the six-month lock-up period following the IPO.

Off-Balance Sheet Arrangements

During the periods presented, we did not have any off-balance sheet arrangements, as defined by applicable SEC rules and regulations.

Contractual Obligations

Our future minimum payments under our noncancelable contractual obligations were as follows as of June 30, 2019 (in thousands):

	Payments Due by Period
	Total		Less Than 1 Year		1 – 3 Years		3 – 5 Years		More Than 5 Years
Purchase commitments (1)	$	52,819	$	52,819		—		—		—
Operating lease obligations (2)		184,798		9,753		41,250		36,555		97,240
Other obligations (3)		75,886		27,297		48,084		505		—
Total	$	313,503	$	89,869	$	89,334	$	37,060	$	97,240

(1)	Represents commitments to purchase finished goods from our contract manufacturer and other inventory related items.

(2)	Represents future minimum lease payments under operating leases.

(3)	Represents commitments included in other noncancelable arrangements like content licensing, advertising buys and other platform services.

We rely on outsourced suppliers to manufacture, assemble and test our players and audio devices. Consistent with industry practices, we enter into firm, noncancelable, and unconditional purchase commitments to acquire products through a combination of purchase orders, supplier contracts, and open orders based on projected demand information. Our suppliers source components and build our products based on these demand forecasts. Changes to projected demand or in the subsequent sales mix of our products, may result in us being committed to purchase excess inventory to satisfy these commitments.

The contractual commitment amounts in the table above are associated with agreements that are enforceable and legally binding. Obligations under contracts that we can cancel without a significant penalty are not included in the table above.

Critical Accounting Policies and Estimates

Our financial statements are prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates.

Except for the accounting policy related to our adoption of the new lease standard there have been no material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in our Annual Report on Form 10-K for the year ended December 31, 2018. Refer to Note 7 of Part I, Item 1 of this Quarterly Report on Form 10-Q for the critical accounting policy resulting from our adoption of the new lease standard.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Interest Rate Fluctuation Risk

Our exposure to interest rate risk primarily relates to the interest income generated by cash, cash equivalents and short-term investments held in our operating and asset management accounts. The primary objective of our investment activities is to preserve principal while maximizing income without significantly increasing risk. We do not believe that an increase or decrease in interest rates of 100 basis points would have a material effect on our operating results or financial condition.

Foreign Currency Exchange Rate Risk

During the six months ended June 30, 2019, there were no material changes to our foreign currency exchange rate risk disclosures as set forth under the heading “Item 7A – Quantitative and Qualitative Disclosures About Market Risk,” in Part II of our Annual Report on Form 10-K for the year ended December 31, 2018.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended June 30, 2019 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We are currently involved in, and may in the future be involved in, legal proceedings, claims, and investigations in the ordinary course of our business, including claims for infringing patents, copyrights or other intellectual property rights related to our platform and products, or the content distributed through our platform by us or third-party channel developers. Although the results of these proceedings, claims, and investigations cannot be predicted with certainty, we do not believe that the final outcome of any matters that we are currently involved in are reasonably likely to have a material adverse effect on our business, financial condition, or results of operations. Regardless of final outcomes, however, any such proceedings, claims, and investigations may nonetheless impose a significant burden on management and employees and may come with expensive attorney fees or unfavorable preliminary and interim rulings.

Item 1A. Risk Factors

Our business involves significant risks, some of which are described below. You should carefully consider the risks and uncertainties described below, together with all the other information in this Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes. If any of the following risks actually occurs, our business, reputation, financial condition, results of operations, revenue, and future prospects could be harmed. Unless otherwise indicated, references to our business being harmed in these risk factors will include harm to our business, reputation, financial condition, results of operations, revenue, and future prospects. In that event, the market price of our Class A common stock could decline, and you could lose part or all of your investment. The risks facing our business have not changed substantively from those discussed in our Annual Report on Form 10-K, filed with the SEC on March 1, 2019, except for those risks marked with an asterisk (*).

Risks Related to Our Business and Industry

We have incurred operating losses in the past, expect to incur operating losses in the future and may never achieve or maintain profitability.*

We began operations in 2002 and we have experienced net losses and negative cash flows from operations in each year since inception. As of June 30, 2019, we had an accumulated deficit of $273.0 million and for the six months ended June 30, 2019, we experienced a net loss of $19.1 million. We expect our operating expenses to increase in the future as we expand our operations. If our revenue and gross profit do not grow at a greater rate than our operating expenses, we will not be able to achieve and maintain profitability. We expect to incur significant losses in the future for a number of reasons, including without limitation the other risks and uncertainties described herein. Additionally, we may encounter unforeseen operating or legal expenses, difficulties, complications, delays and other factors that may result in losses in future periods. If our expenses exceed our revenue, we may never achieve or maintain profitability and our business may be harmed.

TV streaming is highly competitive and many companies, including large technology companies, content owners and aggregators, TV brands and service operators, are actively focusing on this industry. If we fail to differentiate ourselves and compete successfully with these companies, it will be difficult for us to attract and retain users and our business will be harmed.*

TV streaming is increasingly competitive and global. Our success depends in part on attracting and retaining users on, and effective monetization of, our TV streaming platform. To attract and retain users, we need to be able to respond efficiently to changes in consumer tastes and preferences and to offer consumers access to the content they love on terms that they accept. Effective monetization requires us to continue to update the features and functionality of our streaming platform for users, content publishers and advertisers. We also effectively support popular sources of streaming content, such as Amazon Prime Video, Hulu, Netflix and YouTube and respond rapidly to actual and anticipated market trends in the TV streaming industry.

Companies such as Amazon, Apple and Google offer TV streaming devices that compete with our streaming players and Roku TV. In addition, Google licenses its operating system software for integration into smart TVs and service provider set-top boxes and Amazon licenses its operating system software for integration into smart TVs. These companies have the financial resources to subsidize the cost of their streaming devices in order to promote their other products and services, which could make it harder for us to acquire new users and increase hours streamed. These companies could also implement standards or technology that are not compatible with our products or that provide a better streaming experience. These companies also promote their brands through traditional forms of advertising, such as TV commercials, as well as internet advertising or website product placement, and have greater resources to devote to such efforts than we do.

In addition, many TV brands, such as LG, Samsung Electronics Co., Ltd. and VIZIO, Inc., offer their own TV streaming solutions within their TVs. Other devices, such as Microsoft’s Xbox and Sony’s PlayStation game consoles and many DVD and Blu-ray players, also incorporate TV streaming functionality. Similarly, some service operators, such as Comcast and Altice, offer TV streaming applications as part of their cable service plans and can leverage their existing consumer bases, installation networks, broadband delivery networks and name recognition to gain traction in the TV streaming market. If consumers of TV streaming content prefer these alternative products to our streaming players and Roku TVs, we may not able to achieve our expected growth in revenues, gross profit or ARPU.

In July 2018, we launched our Roku TV Wireless Speaker product line, designed specifically for use with Roku TVs. As a result, we may face additional competition from makers of TV audio speakers and soundbars, as well as makers of other TV peripheral devices. While our wireless speaker products have not generated significant revenue, if our wireless speaker products do not operate as designed or do not enhance the Roku TV viewing experience as we intend, our users’ overall viewing experience may be diminished, and this may impact the overall demand for Roku TVs.

We expect competition in TV streaming from the large technology companies and service operators described above, as well as new and growing companies, to increase in the future. This increased competition could result in pricing pressure, lower revenue and gross profit or the failure of our players, Roku TV and our platform to gain or maintain broad market acceptance. To remain competitive and maintain our position as a leading TV streaming platform we need to continuously invest in product development, marketing, service and support and device distribution infrastructure. In addition, evolving TV standards such as 4K, 8K, HDR and unknown future developments may require further investments in the development of our players, Roku TV and our platform. We may not have sufficient resources to continue to make the investments needed to maintain our competitive position. In addition, most of our competitors have longer operating histories, greater name recognition, larger customer bases and significantly greater financial, technical, sales, marketing and other resources than us, which provide them with advantages in developing, marketing or servicing new products and offerings. As a result, they may be able to respond more quickly to market demand, devote greater resources to the development, promotion and sales of their products or the distribution of their content, and influence market acceptance of their products better than we can. These competitors may also be able to adapt more quickly to new or emerging technologies or standards and may be able to deliver products and services at a lower cost. Increased competition could reduce our sales volume, revenue and operating margins, increase our operating costs, harm our competitive position and otherwise harm our business.

We also compete for video viewing hours with mobile platforms (phones and tablets), and users may prefer to view streaming content on such devices. Increased use of mobile or other platforms for video streaming could adversely impact the growth of our streaming hours, harm our competitive position and otherwise harm our business.

We may not be successful in our efforts to further monetize our streaming platform, which may harm our business.*

Our business model depends on our ability to generate platform revenue from advertisers and content publishers. We generate platform revenue primarily from the video advertising and audience development campaigns that run across our platform and from our content partners on a transactional basis when new subscriptions are purchased and content transactions occur on our platform. As such, we are seeking to expand our user base and increase the number of hours that are streamed across our platform in an effort to create additional platform revenue opportunities. The total number of hours streamed, however, does not correlate with platform revenue on a period-by-period basis, because we do not monetize every hour streamed on our platform. As our user base grows and as we increase the amount of content offered and streamed across our platform, we must effectively monetize our expanding user base and streaming activity. Moreover, streaming hours on our platform are measured whenever a Roku player or a Roku TV is streaming content, whether a viewer is actively watching or not. For example, if a Roku player is connected to a TV, and the viewer turns off the TV, steps away or falls asleep and does not stop or pause the player then the particular streaming channel may auto-play subsequent content for a period of time determined by the streaming channel. We believe that this also occurs across a wide variety of non-Roku streaming devices and other set-top boxes.

Our ability to deliver more relevant advertisements to our users and to increase our platform’s value to advertisers and content publishers depends on the collection of user engagement data, which may be restricted or prevented by a number of factors. Users may decide to opt out or restrict our ability to collect personal viewing data or to provide them with more relevant advertisements. Content publishers may also refuse to allow us to collect data regarding user engagement or refuse to implement mechanisms we request to ensure compliance with our legal obligations or technical requirements. For example, we are not able to fully utilize program level viewing data from many of our most popular channels to improve the relevancy of advertisements provided to our users. Other channels available on our platform, such as Amazon Prime Video, Hulu and YouTube, are focused on increasing user engagement and time spent within their channel by allowing users to purchase additional content and streaming services within their channels. In addition, we do not currently monetize content provided on non-certified channels, which are not displayed in the Roku channel store and must be added manually by the user, on our platform. If our users spend most of their time within particular channels where we have limited or no ability to place advertisements or leverage user information, or users opt out from our ability to collect data for use

in providing more relevant advertisements, then we may not be able to achieve our expected growth in platform revenue or gross profit. If we are unable to further monetize our platform, our business may be harmed.

To date, the majority of the hours streamed on our platform have consisted of subscription video on demand content; however, in order to materially increase the monetization of our platform through the sale of video advertising, we will need our users to stream significantly more ad-supported content. Our efforts to monetize our platform through ad-supported content is still developing and may not continue to grow as we expect. Further, while we have experienced, and expect to continue to experience, growth in our advertising revenue, our efforts to monetize our platform through the distribution of advertising video on demand content are still developing and our advertising revenue may not grow as we expect. This means of monetization will require us to continue to attract advertising dollars to our platform as well as deliver advertising video on demand content that appeals to users. Accordingly, there can be no assurance that we will be successful in monetizing our platform through the distribution of advertising-supported video.

We depend on a small number of content publishers for a majority of our streaming hours, and if we fail to maintain these relationships, our business could be harmed, even though the revenue received, directly or indirectly, from streaming on certain of these channels has not been significant to our overall revenue.*

Historically, a small number of content publishers have accounted for a significant portion of the content streamed across our platform and the terms and conditions of our relationships with content publishers vary. In the six months ended June 30, 2019 and the year ended December 31, 2018, Netflix and YouTube accounted for more than 50% all hours streamed in each period. However, although YouTube’s free ad-supported channel is the most viewed ad-supported channel and the second most viewed channel overall by hours streamed on our platform for the six months ended June 30, 2019 and the year ended December 31, 2018, we do not receive material revenue from it. In addition, our agreements with content publishers generally have a term of one to three years and can be terminated before the end of the term by the content publisher under certain circumstances, such as if we materially breach the agreement, become insolvent, enter bankruptcy, commit fraud or fail to adhere to the content publishers’ security or other platform certification requirements. If we fail to maintain our relationships with the content publishers on terms favorable to us, or at all, or if these content publishers face problems in delivering their content across our platform, we may lose channel partners or users and our business may be harmed.

We operate in an evolving industry, which makes it difficult to evaluate our business and prospects. If TV streaming develops more slowly than we expect, our operating results and growth prospects could be harmed. In addition, our future growth depends on the growth of TV streaming advertising.

TV streaming is a relatively new and rapidly evolving industry, making our business and prospects difficult to evaluate. The growth and profitability of this industry and the level of demand and market acceptance for our products and streaming platform are subject to a high degree of uncertainty. We believe that the continued growth of streaming as an entertainment alternative will depend on the availability and growth of cost-effective broadband internet access, the quality of broadband content delivery, the quality and reliability of new devices and technology, the cost for users relative to other sources of content, as well as the quality and breadth of content that is delivered across streaming platforms. These technologies, products and content offerings continue to emerge and evolve. Users, content publishers or advertisers may find TV streaming platforms to be less attractive than traditional TV, which would harm our business. In addition, many advertisers continue to devote a substantial portion of their advertising budgets to traditional advertising, such as TV, radio and print. The future growth of our business depends on the growth of TV streaming advertising, and on advertisers increasing spend on such advertising. We cannot be certain that they will do so. If advertisers do not perceive meaningful benefits of TV streaming advertising, then this market may develop more slowly than we expect, which could adversely impact our operating results and our ability to grow our business.

If we are unable to maintain an adequate supply of quality video ad inventory on our platform or effectively sell our available video ad inventory, our business may be harmed.*

We may fail to attract content publishers that generate sufficient quantity or quality of ad-supported content hours on our platform and continue to grow supply of quality video ad inventory. Our business model depends on our ability to grow video ad inventory on our platform and sell it to advertisers. While The Roku Channel serves as a valuable source of video ad inventory for us to sell, we are also dependent on our ability to monetize video ad inventory that we obtain from the publishers of ad-supported channels on our platform. Our access to video ad inventory in ad-supported streaming channels on our platform varies greatly among channels, accordingly, we do not have access to all of the video ad inventory on our platform. For certain channels, including YouTube’s ad supported channel, we have no access to video ad inventory at this time, and we may not secure access in the future. The amount, quality and cost of video ad inventory available to us can change at any time. If we are unable to grow and maintain a sufficient supply of quality video advertising inventory at reasonable costs to keep up with demand, our business may be harmed.

We operate in a highly competitive industry and we compete for advertising revenue with other internet streaming platforms and services, as well as traditional media, such as radio, broadcast, cable and satellite TV and satellite and internet radio. These competitors offer content and other advertising mediums that may be more attractive to advertisers than our TV streaming platform. These competitors are often very large and have more advertising experience and financial resources than we do, which may adversely affect our ability to compete for advertisers and may result in lower revenue and gross profit from advertising. If we are unable to increase our advertising revenue by, among other things, continuing to improve our platform’s capabilities to further optimize and measure advertisers’ campaigns, increase our advertising inventory and expand our advertising sales team and programmatic capabilities, our business and our growth prospects may be harmed. We may not be able to compete effectively or adapt to any such changes or trends, which would harm our ability to grow our advertising revenue and harm our business.

Our players and Roku TVs must operate with various offerings, technologies and systems from our content publishers that we do not control. If Roku devices do not operate effectively with those offerings, technologies and systems, our business may be harmed.*

Our Roku OS is designed for performance using relatively low-cost hardware, which enables us to drive user growth with our players and Roku TVs offered at a low cost to consumers. However, this hardware must be interoperable with all channels and other offerings, technologies and systems from our content publishers, including virtual multi-channel video programming distributors such as DirectTV Now, Sling TV and YouTube TV. We have no control over these offerings, technologies and systems beyond our channel certification requirements, and if our players do not provide our users with a high-quality experience on those offerings on a cost-effective basis or if changes are made to those offerings that are not compatible with our players, we may be unable to increase active account growth and user engagement, we may be required to increase our hardware costs and our business will be harmed. We plan to continue to introduce new products regularly and we have experienced that it takes time to optimize such products to function well with these offerings, technologies and systems. In addition, many of our largest content publishers have the right to test and certify our new products before we can publish their channels on new products. These certification processes can be time consuming and introduce third party dependencies into our product release cycles. If content publishers do not certify new products on a timely basis or require us to make changes in order to obtain certifications, our product release plans may be adversely impacted, or we may not continue to offer certain channels. To continue to grow our active accounts and user engagement, we will need to prioritize development of our products to work better with new offerings, technologies and systems. If we are unable to maintain consistent operability of Roku devices that is on parity with or better than other platforms, our business could be harmed. In addition, any future changes to offerings, technologies and systems from our content publishers, such as virtual service operators, may impact the accessibility, speed, functionality, and other performance aspects of our products. We may not successfully develop products that operate effectively with these offerings, technologies or systems. If it becomes more difficult for our users to access and use these offerings, technologies or systems, our business could be harmed.

Changes in consumer viewing habits could harm our business.

The manner in which consumers access streaming content is changing rapidly. As the technological infrastructure for internet access continues to improve and evolve, consumers will be presented with more opportunities to access video, music and games on-demand with interactive capabilities. Time spent on mobile devices is growing rapidly, in particular by young adults streaming video content, including popular streaming channels like Netflix and YouTube, as well as content from cable or satellite providers available live or on-demand on mobile devices. In addition, personal computers, smart TVs, DVD players, Blu-ray players, gaming consoles and cable set-top boxes allow users to access streaming entertainment content. If other streaming or technology providers are able to respond and take advantage of changes in consumer viewing habits and technologies better than us, our business could be harmed.

New entrants may enter the TV streaming market with unique service offerings or approaches to providing video. In addition, our competitors may enter into business combinations or alliances that strengthen their competitive positions. If new technologies render the TV streaming market obsolete or we are unable to successfully compete with current and new competitors and technologies, our business will be harmed, and we may not be able to increase or maintain our market share and revenue.

If we fail to obtain or maintain popular content, we may fail to retain existing users and attract new users.*

We have invested a significant amount of time to cultivate relationships with our content publishers; however, such relationships may not continue to grow or yield further financial results. We must continuously maintain existing relationships and identify and establish new relationships with content publishers to provide popular content. In order to remain competitive, we must consistently meet user demand for popular streaming channels and content; particularly as we launch new players or TVs, or enter new markets, including international markets. If we are not successful in helping our content publishers launch and maintain streaming channels that attract and retain a significant number of users on our platform or if we are not able to do so in a cost-effective manner, our business will be harmed. Our ability to successfully help content publishers maintain and expand their channel offerings on a cost-effective basis largely depends on our ability to:

•

effectively market new streaming channels and enhancements to our existing streaming channels;

•

minimize launch delays of new and updated streaming channels; and

•

minimize platform downtime and other technical difficulties.

If we fail to help our content publishers maintain and expand their channel offerings our business may be harmed.

If the advertising and audience development campaigns on our platform are not relevant or not engaging to our users, our growth in active accounts and hours streamed may be adversely impacted.

We have made, and are continuing to make, investments to enable advertisers and content providers to deliver relevant advertisements and audience development campaigns to users on our platform. Existing and prospective advertisers and content providers may not be successful in serving ads and audience development campaigns that lead to and maintain user engagement. Those ads and campaigns may seem irrelevant, repetitive or overly targeted and intrusive. We are continuously seeking to balance the objectives of our users and advertisers with our desire to provide an optimal user experience, but we may not be successful in achieving a balance that continues to attract and retain users and advertisers. If we do not introduce relevant advertisements and audience development campaigns or such advertisements and audience development campaigns are overly intrusive and impede the use of our TV streaming platform, our users may stop using our platform which will harm our business.

The Roku Channel may not continue to attract a large number of users and/or generate significant advertising revenue, and our users may not purchase Premium Subscriptions.*

We operate “The Roku Channel,” which offers both ad-supported free access for users to a collection of films, television series and other content as well as “Premium Subscriptions,” which we launched in January 2019, allowing our users to pay for ad-free content from various content providers, all on one streaming channel. Although The Roku Channel was a top five channel on our platform based on the number of active accounts that accessed the channel at least once in the quarter ended June 30, 2019, other than through Premium Subscriptions, we do not receive subscriptions or other fees from users that access content on The Roku Channel. We have incurred, and will continue to incur, costs and expenses in connection with the launch, development, expansion and operation of The Roku Channel, which we monetize primarily through advertising. If our users do not continue to stream the free, ad-supported content we make available on The Roku Channel, we will not have the opportunity to monetize The Roku Channel through revenue generated from advertising. In order to attract users to the ad-supported content on The Roku Channel and drive streaming of ad-supported video on The Roku Channel, we must secure rights to stream content that is appealing to our users and advertisers. In part, we do this by directly licensing certain content from content owners, such as television and movie studios. The agreements that we enter into with these content owners have varying terms and provide us with rights to make specific content available through The Roku Channel during certain periods of time. Upon expiration of these agreements, we are required to re-negotiate and renew these agreements with the content owners, or enter into new agreements with other content owners, in order to obtain rights to distribute additional titles or to extend the duration of the rights previously granted. If for any period of time, we are unable to enter into content license agreements on acceptable terms to access content that enables us to attract and retain users of the ad-supported content on The Roku Channel, usage of The Roku Channel may decline, and our business may be harmed. Furthermore, if the advertisements on The Roku Channel are not relevant to our users or such advertisements are overly intrusive and impede our users’ enjoyment of the content we make available, our users may not stream content and view advertisements on The Roku Channel, and The Roku Channel may not generate sufficient advertising revenue to be cost effective for us to operate, regardless of our ability to sell Premium Subscriptions. In addition, we recently began distributing The Roku Channel on platforms other than our own streaming platform, and there can be no assurance that we will be successful in attracting a large number of users and/or generating significant advertising revenue through the distribution of The Roku Channel on such other streaming platforms.

Our growth will depend in part upon our ability to develop relationships with TV brands and, to a lesser extent, service operators.

We developed, and intend to continue to develop, relationships with TV brands and service operators in both the United States and international markets. Our licensing arrangements are complex and time-consuming to negotiate and complete. Our current and potential partners include TV brands, cable and satellite companies and telecommunication providers. Under these license arrangements, we generally have limited control over the amount and timing of resources these entities dedicate to the relationship. If our TV brand or service operator partners fail to meet their forecasts for distributing licensed devices, our business may be harmed.

We license our Roku OS to certain TV brands to manufacture co-branded smart TVs, or Roku TVs. The primary economic benefits that we derive from these license arrangements have been and will likely continue to be indirect, primarily from growing our active accounts and increasing hours streamed. We have not received, nor do we expect to receive significant license revenue from

these arrangements in the near term, but we expect to incur expenses in connection with these commercial agreements. If these arrangements do not result in increased users and hours streamed, our business may be harmed. The loss of a relationship with a TV brand or service operator could harm our results of operations, damage our reputation, increase pricing and promotional pressures from other partners and distribution channels or increase our marketing costs. If we are not successful in maintaining existing and creating new relationships with any of these third parties, or if we encounter technological, content licensing or other impediments to our development of these relationships, our ability to grow our business could be adversely impacted.

If our users sign up for offerings and services outside of our platform or through other channels on our platform, our business may be harmed.*

We earn revenue by acquiring subscribers for certain of our content publishers activated on or through our platform. If users do not use our platform for these purchases or subscriptions for any reason, and instead pay for services directly with content publishers or by other means that we do not receive attribution for, our business may be harmed. In addition, certain channels available on our platform allow users to purchase additional streaming services from within their channels. The revenue we earn from these transactions are generally not equivalent to the revenue we earn from activations on or through our platform that we receive full attribution credit for. For Premium Subscriptions, we only earn revenue for subscriptions to these services through our platform. Accordingly, if users activate subscriptions for content or services through other channels on our platform, our business may be harmed.

If we were to lose the services of our Chief Executive Officer or other members of our senior management team, we may not be able to execute our business strategy.

Our success depends in a large part upon the continued service of key members of our senior management team. In particular, our founder, President and Chief Executive Officer, Anthony Wood, is critical to our overall management, as well as the continued development of our devices and the Roku platform, our culture and our strategic direction. All of our executive officers are at will employees, and we do not maintain any key person life insurance policies. The loss of any member of our senior management team could harm our business.

If we are unable to attract and retain highly qualified employees, we may not be able to continue to grow our business.

Our ability to compete and grow depends in large part on the efforts and talents of our employees. Our employees, particularly engineers and other product developers, are in high demand, and we devote significant resources to identifying, hiring, training, successfully integrating and retaining these employees. As competition with other companies increases, we may incur significant expenses in attracting and retaining high quality engineers and other employees. The loss of employees or the inability to hire additional skilled employees as necessary to support the rapid growth of our business and the scale of our operations could result in significant disruptions to our business, and the integration of replacement personnel could be time-consuming and expensive and cause additional disruptions to our business.

We believe a critical component to our success and our ability to retain our best people is our culture. As we continue to grow and develop a public company infrastructure, we may find it difficult to maintain our entrepreneurial, execution-focused culture. In addition, many of our employees may be able to receive significant proceeds from sales of our equity in the public markets, which may reduce their motivation to continue to work for us. Moreover, the equity ownership of many of our employees could create disparities in wealth among our employees, which may harm our culture and relations among employees and our business.

Most of our agreements with streaming channel publishers are not long term. Any disruption in the renewal of such agreements may result in the removal of certain channels from our platform and may harm our active account growth and engagement.*

We enter into agreements with all our streaming channel publishers, which have varying expiration dates; typically, over one to three years. Upon expiration of these agreements, we are required to re-negotiate and renew these agreements in order to continue providing content offerings from these streaming channel publishers on our platform. We may not be able to reach a satisfactory agreement before our existing agreements have expired. If we are unable to renew such agreements on a timely basis on mutually agreeable terms, we may be required to temporarily or permanently remove certain channels from our platform. The loss of such channels from our platform for any period of time may harm our business.

If our content publishers do not continue to develop channels for our platform and participate in new features that we may introduce from time to time, our business may be harmed.

As our platform and products evolve, we will continue to introduce new features, which may or may not be attractive to our content publishers or meet their requirements. For example, some content publishers have elected not to participate in our cross-channel search feature, our integrated advertising framework, known as RAF, or have imposed limits on our data gathering for usage within their channels. In addition, our platform utilizes our proprietary Brightscript scripting language in order to allow our content publishers to develop and create channels on our platform. If we introduce new features or utilize a new scripting language in the future, such a change may not comply with our content publishers' certification requirements. In addition, our content publishers may find other languages, such as HTML5, more attractive to develop for and shift their resources to developing their channels on other platforms. If content publishers do not find our platform simple and attractive to develop channels for, do not value and participate in all of the features and functionality that our platform offers, or determine that our software developer kit or new features of our platform do not meet their certification requirements, our business may be harmed.

Our quarterly operating results may be volatile and are difficult to predict, and our stock price may decline if we fail to meet the expectations of securities analysts or investors.

Our revenue, gross profit and other operating results could vary significantly from quarter-to-quarter and year-to-year and may fail to match our past performance due to a variety of factors, including many factors that are outside of our control. Factors that may contribute to the variability of our operating results and cause the market price of our Class A common stock to fluctuate include:

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the entrance of new competitors or competitive products in our market, whether by established or new companies;

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our ability to retain and grow our active account base and increase engagement among new and existing users;

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our ability to maintain effective pricing practices, in response to the competitive markets in which we operate or other macroeconomic factors, such as inflation or increased product taxes;

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our revenue mix, which drives gross profit;

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seasonal or other shifts in advertising revenue or player sales;

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the timing of the launch of new or updated products, streaming channels or features;

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the addition or loss of popular content;

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the ability of retailers to anticipate consumer demand;

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an increase in the manufacturing or component costs of our players or the manufacturing or component costs of our TV brand licensees for Roku TVs; and

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an increase in costs associated with protecting our intellectual property, defending against third-party intellectual property infringement allegations or procuring rights to third-party intellectual property.

Our gross margins vary across our devices and platform offerings. Player revenue has a lower gross margin compared to platform revenue derived through our arrangements with advertising, content distribution, billing and licensing activities. Gross margins on our players vary across player models and can change over time as a result of product transitions, pricing and configuration changes, component costs, player returns and other cost fluctuations. In addition, our gross margin and operating margin percentages, as well as overall profitability, may be adversely impacted as a result of a shift in device, geographic or sales channel mix, component cost increases, price competition, or the introduction of new players, including those that have higher cost structures with flat or reduced pricing. We have in the past and may in the future strategically reduce our player gross margin in an effort to increase our active accounts and grow our gross profit. As a result, our player revenue may not increase as rapidly as it has historically, or at all, and, unless we are able to adequately increase our platform revenue and grow our active accounts, we may be unable to grow gross profit and our business will be harmed. If a reduction in gross margin does not result in an increase in our active accounts and gross profit, our financial results may suffer, and our business may be harmed.

Our revenue and gross profit are subject to seasonality and if our sales during the holiday season fall below our expectations, our business may be harmed.

Seasonal consumer shopping patterns significantly affect our business. Specifically, our revenue and gross profit are traditionally strongest in the fourth quarter of each fiscal year and represent a high percentage of the total net revenue for such fiscal year due to higher consumer purchases and increased advertising during holiday periods. Furthermore, a significant percentage of our player sales through retailers in the fourth quarter are pursuant to committed sales agreements with retailers for which we recognize significant discounts in the average selling prices in the third quarter in an effort to grow our active accounts, which will reduce our player gross margin.

Given the seasonal nature of our player sales, accurate forecasting is critical to our operations. We anticipate that this seasonal impact on revenue and gross profit is likely to continue, and any shortfall in expected fourth quarter revenue, due to macroeconomic conditions, a decline in the effectiveness of our promotional activities, actions by our competitors or disruptions in our supply or distribution chain, or for any other reason, would cause our full year results of operations to suffer significantly. For example, delays or disruptions at U.S. ports of entry could adversely affect our or our licensees’ ability to timely deliver players and co-branded Roku TVs to retailers during the holiday season. A substantial portion of our expenses are personnel related and include salaries, stock-based compensation and benefits that are not seasonal in nature. Accordingly, in the event of a revenue shortfall, we would be unable to mitigate the negative impact on margins, at least in the short term, and our business would be harmed.

We and our TV brand partners depend on our retail sales channels to effectively market and sell our players and Roku TVs, and if we or our partners fail to maintain and expand effective retail sales channels we could experience lower player or Roku TV sales.*

To continue to acquire new active accounts, we must maintain and expand our retail sales channels. The majority of our players and Roku TVs are sold through traditional brick and mortar retailers, such as Best Buy, Target and Walmart, including their online sales platforms, and online retailers such as Amazon. To a lesser extent, we sell players directly through our website and internationally through distributors. For the six months ended June 30, 2019 and June 30, 2018, Amazon, Best Buy and Walmart in total accounted for 73% and 66%, respectively, of our player revenue and are expected to each account for more than 10% of our player revenue in fiscal 2019. These three retailers collectively accounted for 68% and 61% of our player revenue for the years ended December 31, 2018 and 2017, respectively. These retailers and our international distributors also sell products offered by our competitors. We have no minimum purchase commitments or long-term contracts with any of these retailers or distributors. If one or several retailers or distributors were to discontinue selling our players or Roku TVs or choose not to prominently display those devices in their stores or on their websites, the volume of Roku devices sold could decrease, which would harm our business. For example, in April 2018, Amazon and Best Buy announced a partnership whereby two Best Buy controlled smart TV brands will exclusively utilize Amazon’s operating system, and such TVs will be sold by Best Buy and Amazon. Although, to date, this arrangement has not limited our TV brand partners’ ability to sell on either Amazon or at Best Buy, if our existing TV brands choose to work exclusively with other operating system developers, this may impact our Roku TV program and our ability to continue to grow active accounts. Traditional retailers have limited shelf and end cap space in their stores and limited promotional budgets, and online retailers have limited prime website product placement space. Competition is intense for these resources, and a competitor with more extensive product lines and stronger brand identity, such as Apple or Google, possesses greater bargaining power with retailers. In addition, one of our online retailers, Amazon, sells its own competitive TV streaming products and is able to market and promote these products more prominently on its website, and could refuse to offer our devices. Any reduction in our ability to place and promote our devices, or increased competition for available shelf or website placement, would require us to increase our marketing expenditures simply to maintain our product visibility, which may harm our business. In particular, the availability of product placement during peak retail periods, such as the holiday season, is critical to our revenue growth, and if we are unable to effectively sell our devices during these periods, our business would be harmed.

If our efforts to build a strong brand and maintain customer satisfaction and loyalty are not successful, we may not be able to attract or retain users, and our business may be harmed.

Building and maintaining a strong brand is important to attract and retain users, as potential users have a number of TV streaming choices. Successfully building a brand is a time consuming and comprehensive endeavor and can be positively and negatively impacted by any number of factors. Some of these factors, such as the quality or pricing of our players or our customer service, are within our control. Other factors, such as the quality and reliability of Roku TVs and the quality of the content that our content publishers provide, may be out of our control, yet users may nonetheless attribute those factors to us. Our competitors may be able to achieve and maintain brand awareness and market share more quickly and effectively than we can. Many of our competitors are larger companies and promote their brands through traditional forms of advertising, such as print media and TV commercials, and have substantial resources to devote to such efforts. Our competitors may also have greater resources to utilize internet advertising or website product placement more effectively than we can. If we are unable to execute on building a strong brand, it may be difficult to differentiate our business and platform from our competitors in the marketplace, therefore our ability to attract and retain users may be adversely affected and our business may be harmed.

Our streaming platform allows our customers to choose from thousands of channels, representing a variety of content from a wide range of content publishers. Our customers can choose and control which channels they download and watch, and they can use parental control settings to prevent channels from being downloaded to our devices. While we have policies that prohibit the publication of content that is unlawful, incites illegal activities or violates third-party rights, among other things, we may distribute channels that include controversial content. Controversies related to the content included on certain of the channels that we distribute could result in negative publicity, cause harm to our reputation and brand or subject us to claims and may harm our business.

We must successfully manage streaming device and other product introductions and transitions to remain competitive.

We must continually develop new and improved streaming devices and other products that meet changing consumer demands. Moreover, the introduction of a new streaming device or other product is a complex task, involving significant expenditures in research and development, promotion and sales channel development. For example, in 2018, we introduced our new Roku TV Wireless Speaker, designed specifically for use with Roku TVs. Whether users will broadly adopt new products is not certain. Our future success will depend on our ability to develop new and competitively priced streaming devices and other products and add new desirable content and features to our platform. Moreover, we must introduce new streaming devices and other products in a timely and cost-effective manner, and we must secure production orders for those products from our contract manufacturers. The development of new products is a highly complex process, and while our research and development efforts are aimed at solving increasingly complex problems, we do not expect that all of our projects will be successful. The successful development and introduction of new products depends on a number of factors, including the following:

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the accuracy of our forecasts for market requirements beyond near term visibility;

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our ability to anticipate and react to new technologies and evolving consumer trends;

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our development, licensing or acquisition of new technologies;

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our timely completion of new designs and development;

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the ability of our contract manufacturers to cost-effectively manufacture our new products;

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the availability of materials and key components used in manufacturing; and

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our ability to attract and retain world-class research and development personnel.

If any of these or other factors becomes problematic, we may not be able to develop and introduce new products in a timely or cost-effective manner, and our business may be harmed.

We do not have manufacturing capabilities and primarily depend upon a small number of contract manufacturers, and our operations could be disrupted if we encounter problems with the contract manufacturers.*

We do not have any internal manufacturing capabilities and primarily rely upon one contract manufacturer, Foxconn Industrial Internet Co. Ltd., or Foxconn, to build our players. We similarly rely on one contract manufacturer, Tonly Electronics Holdings Ltd., or Tonly, to manufacture our wireless speakers. Our contract manufacturers may be vulnerable to capacity constraints, increases in U.S. tariffs on imports of our players or Chinese tariffs on U.S. parts or components for finished players that are assembled in China, and reduced component availability, and our control over delivery schedules, manufacturing yields and costs, particularly when components are in short supply or when we introduce a new player or other product or feature, is limited. In addition, we have limited control over Foxconn’s or Tonly’s quality systems and controls, and therefore must rely on them to manufacture our players and other products to our quality and performance standards and specifications. Delays, component shortages and other manufacturing and supply problems could impair the retail distribution of our players and other products and ultimately our brand. Furthermore, any adverse change in our contract manufacturers’ financial or business condition could disrupt our ability to supply our players or other products to our retailers and distributors.

Our contracts with our contract manufacturers generally do not obligate them to supply our players or other products in any specific quantity or at any specific price. In the event our contracts manufacturers are unable to fulfill our production requirements in a timely manner, their costs increase because of U.S. or Chinese tariffs, or decide to terminate their relationship with us, our order fulfillment may be delayed, and we would have to identify, select and qualify acceptable alternative contract manufacturers. Alternative contract manufacturers may not be available to us when needed or may not be in a position to satisfy our production requirements at commercially reasonable prices or to our quality and performance standards. Any significant interruption in manufacturing at one of our contract manufacturers would require us to reduce our supply of players or other products to our retailers and distributors, which in turn would reduce our revenue. In addition, the Foxconn and Tonly facilities are located in the People’s Republic of China and may be subject to political, economic, social and legal uncertainties that may harm our relationships with these parties. We believe that the international location of these facilities increases supply risk, including the risk of supply interruptions. Furthermore, any manufacturing issues affecting the quality of our products, including wireless speakers and players, could harm our business.

If either of our contract manufacturers fail for any reason to continue manufacturing our players or other products in required volumes and at high quality levels, or at all, we would have to identify, select and qualify acceptable alternative contract manufacturers. Alternative contract manufacturers may not be available to us when needed or may not be in a position to satisfy our production requirements at commercially reasonable prices or to our quality and performance standards. Any significant interruption

in manufacturing at a contract manufacturer could require us to reduce our supply of players or other products to our retailers and distributors, which in turn would reduce our revenue and user growth.

Certain of our Roku TV brand partners do not have manufacturing capabilities and primarily depend upon contract manufacturers, and the supply of Roku TVs to the market could be disrupted if they encounter problems with their contract manufacturers or suppliers.*

Certain of our Roku TV brand partners do not have internal manufacturing capabilities and primarily rely upon contract manufacturers to build the Roku TVs that they sell to retailers. Their contract manufacturers may be vulnerable to capacity constraints and reduced component availability, increases in U.S. tariffs on imports of Roku TVs, or Chinese tariffs on U.S. parts or components for Roku TVs that are assembled in China, and their control over delivery schedules, manufacturing yields and costs, particularly when components are in short supply may be limited. Delays, component shortages and other manufacturing and supply problems could impair the retail distribution of their Roku TVs. A significant interruption in the supply of Roku TVs to retailers and distributors could, in turn, reduce our user growth.

Furthermore, any manufacturing issues affecting the quality of our Roku TV brand partners’ Roku TVs, could harm our brand and our business.

Changes in general economic conditions, geopolitical conditions, U.S. trade policies and other factors beyond our control may adversely impact our business and operating results.*

Our businesses are subject to risks generally associated with doing business abroad, such as foreign governmental regulation in the countries in which our manufacturing sources are located. Our operations and performance depend significantly on global, regional and U.S. economic and geopolitical conditions. For example, there has been discussion and dialogue regarding potential significant changes to U.S. trade policies, legislation, treaties and tariffs, including the North American Free Trade Agreement (“NAFTA”). On November 30, 2018 the United States, Mexico, and Canada signed a replacement trade deal for NAFTA, known as the United States-Mexico-Canada Agreement (“USMCA”), which still needs to be ratified by the respective government of each of the three countries. The USMCA could undergo changes that lead to further modifications of certain USMCA provisions before being passed into law. In addition, the current U.S. Administration has threatened to withdraw from NAFTA if Congress does not move expeditiously to approve the USMCA, which could lead to higher tariffs on imports of televisions from Mexico by our licensees. Furthermore, the current U.S. Administration has threatened tougher trade terms with China and other countries, leading to the imposition of substantially higher U.S. Section 301 tariffs on $250 billion of imports from China so far. In response, China has imposed higher Chinese tariffs on a large amount of U.S. exports to China, which could affect the prices of U.S. origin parts or components of our products assembled in China. In addition, on May 6, 2019, the administration announced the Section 301 tariffs on $200 billion of imports from China, which were originally set at 10%, would be increased to 25%, and that it was starting the notice-and-comment process for potentially imposing Section 301 tariffs on the remaining $300 billion of imports from China. While televisions were excluded from previous Section 301 duties, President Trump announced on August 1, 2019, that he plans to impose an additional tariff of 10% on the remaining $300 billion of goods and products coming from China, beginning September 1, 2019. These tariffs could include imports of televisions and streaming players. At this time, it is unknown whether and to what extent new USMCA legislation will be passed into law; whether Section 301 tariffs will be imposed on Roku products, imported from China and, if so, how long U.S. tariffs on Chinese goods will remain in effect or whether additional tariffs will be imposed, or new regulatory proposals will be adopted; whether international trade agreements will be negotiated or existing free trade agreements re-negotiated, or the effect that any such action would have, either positively or negatively, on our industry or our business or licensees. If any new legislation and/or regulations are implemented, or if existing trade agreements are renegotiated or terminated, or if tariffs are imposed on foreign-sourced or U.S. goods, it may be inefficient and expensive for us to alter our business operations in order to adapt to or comply with such changes. Such operational changes could have a material adverse effect on our business, financial condition, results of operations or cash flows.

Also, various countries, in addition to the United States, regulate the import and export of certain technology, including import and export licensing requirements, and have enacted laws that could limit our ability to distribute our products or could limit our commercial and/or strategic partners’ ability to implement our products in those countries. Changes in our products or future changes in export and import regulations may create delays in the introduction of our products in international markets, prevent our commercial and/or strategic partners with international operations from deploying our products globally or, in some cases, prevent the export or import of our products to certain countries, governments, or persons altogether. Any change in export or import regulations, the imposition of customs duties on intangible goods such as cross-border data flows which are currently duty-free under the WTO’s temporary e-commerce moratorium, economic sanctions or related legislation, increased export and import controls stemming governmental policies, or change in the countries, governments, persons or technologies targeted by such regulations, could result in decreased use of our products by, or in our decreased ability to export or sell our products to, existing or new customers in

international markets. Any decreased use of our products or limitation on our ability to export or sell our products would harm our business.

If we fail to accurately forecast our manufacturing requirements and manage our inventory with our contract manufacturers, we could incur additional costs, experience manufacturing delays and lose revenue.

We bear supply risk under our contract manufacturing arrangements with Foxconn and Tonly. Lead times for the materials and components that our contract manufacturers orders on our behalf through different component suppliers vary significantly and depend on numerous factors, including the specific supplier, contract terms and market demand for a component at a given time. Lead times for certain key materials and components incorporated into our players are currently lengthy, requiring our contract manufacturers to order materials and components several months in advance. If we overestimate our production requirements, our contract manufacturers may purchase excess components and build excess inventory. If our contract manufacturers, at our request, purchase excess components that are unique to our players or build excess players, we could be required to pay for these excess components or players. In the past, we have agreed to reimburse our contract manufacturers for purchased components that were not used as a result of our decision to discontinue players or the use of particular components. If we incur costs to cover excess supply commitments, this would harm our business.

Conversely, if we underestimate our player or other product requirements, our contract manufacturers may have inadequate component inventory, which could interrupt the manufacturing of our players or other products and result in delays or cancellation of orders from retailers and distributors. In addition, from time to time we have experienced unanticipated increases in demand that resulted in the need to ship players via air freight, which is more expensive than ocean freight, and adversely affected our player gross margin during such periods of high demand, for example, during end-of-year holidays. If we fail to accurately forecast our manufacturing requirements, our business may be harmed.

Our players incorporate key components from sole source suppliers and if our contract manufacturer is unable to source these components on a timely basis, due to fabrication capacity issues or other material supply constraints, we will not be able to deliver our players to our retailers and distributors.*

We depend on sole source suppliers for key components in our players. Our players utilize specific system on chip, or SoC, Wi-Fi silicon products and Wi-Fi front-end modules from various manufacturers, depending on the player, for which we do not have a second source. Although this approach allows us to maximize player performance on lower cost hardware, reduce engineering qualification costs and develop stronger relationships with our strategic suppliers, this also creates supply chain risk. These sole-source suppliers could be constrained by fabrication capacity issues or material supply issues, such as Chinese tariffs on U.S. parts or components for finished players that are used in final assembly of their components in China, or the risk that the strategic supplier may stop producing such components, cease operations or be acquired by, or enter into exclusive arrangements with, our competitors or other companies. Any such interruption or delay may force us to seek similar components from alternative sources, which may not be available. Switching from a sole-source supplier would require that we redesign our players to accommodate new components and would require us to re-qualify our players with regulatory bodies, such as the Federal Communications Commission (“FCC”), which would be costly and time-consuming.

Our reliance on sole-source suppliers involves a number of additional risks, including risks related to:

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supplier capacity constraints;

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price increases;

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timely delivery;

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component quality; and

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delays in, or the inability to execute on, a supplier roadmap for components and technologies.

Any interruption in the supply of sole-source components for our players could adversely affect our ability to meet scheduled player deliveries to our retailers and distributors, result in lost sales and higher expenses and harm our business.

If we have difficulty managing our growth in operating expenses, our business could be harmed.*

We have experienced significant growth in research and development, sales and marketing, support services and operations in recent years and expect to continue to expand these activities. Our historical growth has placed, and expected future growth will continue to place, significant demands on our management, as well as our financial and operational resources, to:

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manage a larger organization;

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hire more employees, including engineers with relevant skills and experience;

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expand our manufacturing and distribution capacity;

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increase our sales and marketing efforts;

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broaden our customer support capabilities;

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support a larger number of TV brand and service operators;

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implement appropriate operational and financial systems;

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expand internationally; and

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maintain effective financial disclosure controls and procedures.

In addition, due to the continued growth in our headcount, we have entered into lease agreements for a new corporate headquarters, and we started to incur material expenses this year.

If we fail to manage our growth effectively, we may not be able to execute our business strategies and our business will be harmed.

We may be unable to successfully expand our international operations and our international expansion plans, if implemented, will subject us to a variety of risks that may harm our business.*

We currently generate the vast majority of our revenue in the United States and have limited experience marketing, selling, licensing and supporting our devices and monetizing our platform outside the United States. In addition, we have limited experience managing the administrative aspects of a global organization. While we intend to continue to explore opportunities to expand our business in international markets in which we see compelling opportunities, we may not be able to create or maintain international market demand for our devices and streaming platform.

In the course of expanding our international operations and operating overseas, in addition to the risks we face in the U.S., we will be subject to a variety of risks that could adversely affect our business, including:

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differing regulatory requirements, including country-specific data privacy and security laws and regulations, consumer protection laws and regulations, tax laws, trade laws, labor regulations, tariffs, export quotas, custom duties on cross-border movements of goods or data flows, or other trade restrictions;

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compliance with laws such as the Foreign Corrupt Practices Act, UK Bribery Act and other anti-corruption laws, export controls and economic sanctions, and local laws prohibiting corrupt payments to government officials;

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slower adoption and acceptance of streaming products and services in other countries;

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competition with existing local traditional pay TV services and products, including those provided by incumbent pay TV service providers;

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greater difficulty supporting and localizing our players and streaming platform, including delivering support and training documentation in languages other than English;

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our ability to deliver or provide access to popular streaming channels to users in certain international markets;

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different or unique competitive pressures as a result of, among other things, the presence of local consumer electronics companies and the greater availability of free content on over-the-air channels in certain countries;

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challenges inherent in efficiently staffing and managing an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, compensation and benefits and compliance programs;

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difficulties in understanding and complying with local laws, regulations and customs in foreign jurisdictions;

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differing legal and court systems, including limited or unfavorable intellectual property protection;

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international political or social unrest or economic instability;

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availability of reliable broadband connectivity and wide area networks in areas targeted for expansion;

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adverse tax consequences such as those related to changes in tax laws or tax rates or their interpretations could impact our judgment in determining our tax provision and effective tax rate;

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fluctuations in currency exchange rates could impact our revenue and expenses of our international operations and expose us to foreign currency exchange rate risk;

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restrictions on the repatriation of earnings; and

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working capital constraints.

If we invest substantial time and resources to expand our international operations and are unable to do so successfully and in a timely manner, our business and financial condition may be harmed.

If we experience higher player returns than we expect and are unable to resell such returned players as refurbished players, our business could be harmed.*

We offer customers who purchase players through our website 30 days to return such players. We also generally honor the return policies of our retail and distribution partners, who typically allow customers to return players, even with open packaging within certain time periods that may exceed 30 days. We generally resell any returned players as refurbished players. To the extent we experience a greater number of returns than we expect, are unable to resell returned players as refurbished players or are required to provide price protection in amounts greater than we expect, our business could be harmed.

We are subject to payment-related risks and, if our advertisers or advertising agencies do not pay or dispute their invoices, our business may be harmed.

Many of our contracts with advertising agencies provide that if the advertiser does not pay the agency, the agency is not liable to us, and we must seek payment solely from the advertiser, a type of arrangement called sequential liability. Contracting with these agencies, which in some cases have or may develop higher-risk credit profiles, may subject us to greater credit risk than if we were to contract directly with advertisers. This credit risk may vary depending on the nature of an advertising agency’s aggregated advertiser base. We may also be involved in disputes with agencies and their advertisers over the operation of our platform or the terms of our agreements. If we are unable to collect or make adjustments to bills, we could incur write-offs for bad debt, which could have a material adverse effect on our results of operations for the periods in which the write-offs occur. In the future, bad debt may exceed reserves for such contingencies and our bad debt exposure may increase over time. Any increase in write-offs for bad debt could have a materially negative effect on our business, financial condition and operating results. If we are not paid by our advertisers or advertising agencies on time or at all, our business may be harmed.

Any significant disruption in our computer systems or those of third parties we utilize in our operations could result in a loss or degradation of service on our platform and could harm our business.

We rely on the expertise of our engineering and software development teams for the performance and operation of our platform and computer systems. Service interruptions, errors in our software or the unavailability of computer systems used in our operations could diminish the overall attractiveness of our devices and platform to existing and potential users. We utilize computer systems located either in our facilities or those of third-party server hosting providers and third-party internet-based or cloud computing services. Although we generally enter into service level agreements with these parties, we exercise no control over their operations, which makes us vulnerable to any errors, interruptions or delays that they may experience. In the future, we may transition additional features of our services from our managed hosting systems to cloud computing services, which may require significant expenditures and engineering resources. If we are unable to manage a transition effectively, we may experience operational delays and inefficiencies until the transition is complete. Upon the expiration or termination of any of our agreements with third-party vendors, we may not be able to replace their services in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete. In addition, fires, floods, earthquakes, power losses, telecommunications failures, break-ins and similar events could damage these systems and hardware or cause them to fail completely. As we do not maintain entirely redundant systems, a disrupting event could result in prolonged downtime of our operations and could adversely affect our business. Any disruption in the services provided by these vendors could have adverse impacts on our business reputation, customer relations and operating results.

If any aspect of our computer systems or those of third parties we utilize in our operations fails, it may lead to downtime or slow processing time, either of which may harm the experience of users. We have experienced, and may in the future experience, service disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, human or software errors and capacity constraints. We expect to continue to make significant investments in our technology infrastructure to maintain and improve the user experience and platform performance. To the extent that we do not effectively address capacity constraints,

upgrade our systems as needed and continually develop our technology and network architecture to accommodate increasingly complex services and functions, increasing numbers of users, and actual and anticipated changes in technology, our business may be harmed.

Significant disruptions of our information technology systems or data security incidents could harm our reputation and our business and subject us to liability.*

We are increasingly dependent on information technology systems and infrastructure to operate our business. In the ordinary course of our business, we collect, store, process and transmit large amounts of sensitive corporate, personal and other information, including intellectual property, proprietary business information, user payment card information, other user information and other confidential information. It is critical that we do so in a secure manner to maintain the confidentiality, integrity and availability of such information. Our ability to maintain the confidentiality, integrity and availability of personal information in our possession or control create potential legal liability, both from regulators as well as from affected consumers, and also impacts the attractiveness of our subscription service to existing and potential members. We have also outsourced elements of our operations (including elements of our information technology infrastructure) to third parties, or may have incorporated technology into our platform, that collects, processes, transmits and stores our users’ personal and credit card information, and as a result, we manage a number of third-party vendors who may or could have access to our computer networks or to confidential information that moves across our platform. In addition, many of those third parties in turn subcontract or outsource some of their responsibilities to third parties. As a result, our information technology systems, including the functions of third parties that are involved or have access to those systems, is very large and complex. While all information technology operations are inherently vulnerable to inadvertent or intentional security breaches, incidents, attacks and exposures, the size, complexity, accessibility and distributed nature of our information technology systems, and the large amounts of sensitive or personal information stored on those systems, make such systems potentially vulnerable to unintentional or malicious, internal and external attacks on our technology environment. Vulnerabilities can be exploited from inadvertent or intentional actions of our employees, third-party vendors, business partners, or by malicious third parties. Attacks of this nature are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives (including, but not limited to, industrial espionage) and expertise, including organized criminal groups, “hacktivists,” nation states and others. In addition to the extraction of sensitive or personal information, such attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of information. Some of these external threats may be amplified by the nature of our third-party web hosting, cloud computing, or network-dependent streaming services or suppliers. Our systems likely experience directed attacks on at least a periodic basis that are intended to interrupt our operations, interrupt our customers’ ability to access our services, extract money from our company, and/or obtain our data (including without limitation customer or employee personal information or proprietary information). Although we have implemented certain systems, processes, and safeguards intended to thwart attackers and mitigate risks to our systems and data, we cannot be certain that threat actors will not have a material impact on our systems or services in the future. Additionally, we cannot directly control the security of the computer systems of our third-party vendors or business partners or actions of their personnel, and therefore may be vulnerable to attacks through those or similar third-party relationships.

We maintain limited insurance policies to cover losses relating to our systems. However, there may be exceptions to our insurance coverage such that our insurance policies may not cover some or all aspects of a security incident. Even where an incident is covered by our insurance, the insurance limits may not cover the costs of complete remediation and redress that we may be faced with in the wake of a security incident. Though it is difficult to determine what harm may directly result from any specific interruption or breach, any failure to maintain performance, reliability, security and availability of our network infrastructure to the satisfaction of our users or regulators may harm our reputation and our ability to retain existing users and attract new users. Because of our prominence in the TV streaming industry, we believe we may be a particularly attractive target for hackers. Our platform also incorporates licensed software from third-parties, including open source software, and we may also be vulnerable to attacks that focus on such third-party software. Any attempts by hackers to disrupt our platform, our devices, website, computer systems or our mobile apps, if successful, could harm our business, subject us to liability, be expensive to remedy, cause harm to our systems and operations and damage our reputation. Efforts to prevent hackers from entering our computer systems or exploiting vulnerabilities in our devices are expensive to implement and may not be effective in detecting or preventing intrusion or vulnerabilities. Such unauthorized access to users’ data could damage our reputation and our business and could expose us of the risk to contractual damages, litigation and regulatory fines and penalties that could harm our business. The risk of harm to our business caused by security incidents may also increase as we expand our product and service offerings and as we enter into new markets. Implementing, maintaining, and updating security safeguards requires substantial resources now and will likely be an increasing and substantial cost in the future.

Significant disruptions of our third-party vendors’ and/or commercial partners’ information technology systems or other similar data security incidents could adversely affect our business operations and/or result in the loss, misappropriation, and/or unauthorized access, use or disclosure of, or the prevention of access to, sensitive or personal information, which could harm our business. In addition, information technology system disruptions, whether from attacks on our technology environment or from computer viruses,

natural disasters, terrorism, war and telecommunication and electrical failures, could result in a material disruption of our product development and our business operations.

There is no way of knowing with certainty whether we have experienced any data security incidents that have not been discovered. While we have no reason to believe this to be the case, attackers have become very sophisticated in the way they conceal access to systems, and many companies that have been attacked are not aware that they have been attacked. Any event that leads to unauthorized access, use or disclosure of personal information, including but not limited to personal information regarding our customers, could disrupt our business, harm our reputation, compel us to comply with applicable federal and/or state breach notification laws and foreign law equivalents, subject us to time consuming, distracting and expensive litigation, regulatory investigation and oversight, mandatory corrective action, require us to verify the correctness of database contents, or otherwise subject us to liability under laws, regulations and contractual obligations, including those that protect the privacy and security of personal information. This could result in increased costs to us and result in significant legal and financial exposure and/or reputational harm. For example, in the wake of a data breach involving payment card data, we may be subject to substantial penalties and related enforcement for failure to adhere to the technical or operational security requirements of the Payment Card Industry (“PCI”) Data Security Standards (“DSS”) imposed by the PCI Council to protect cardholder data. Penalties arising from PCI DSS enforcement are inherently uncertain as penalties may be imposed by various entities within the payment card processing chain without regard to any statutory or universally mandated framework. Such enforcement could threaten our relationship with our banks, card brands we do business with, and our third-party payment processors. In addition, any failure or perceived failure by us or our vendors or business partners to comply with our privacy, confidentiality or data security-related legal or other obligations to third parties, or any further security incidents or other unauthorized access events that result in the unauthorized access, release or transfer of sensitive information, which could include personal information, may result in governmental investigations, enforcement actions, regulatory fines, litigation, or public statements against us by advocacy groups or others, and could cause third parties, including current and potential partners, to lose trust in us or we could be subject to claims by third parties that we have breached our privacy- or confidentiality-related obligations, which could materially and adversely affect our business and prospects. Moreover, data security incidents and other inappropriate access can be difficult to detect, and any delay in identifying them may lead to increased harm of the type described above. While we have implemented security measures intended to protect our information technology systems and infrastructure, as well as the personal and proprietary information that we possess or control, there can be no assurance that such measures will successfully prevent service interruptions or further security incidents. Data protection laws around the world often take a principled, risk-based approach to information security and require “reasonable”, “appropriate” or “adequate” technical and organizational security measures, meaning that the interpretation and application of those laws are often uncertain and evolving, and there can be no assurance that our security measures will be deemed adequate or reasonable in all instances. In addition to potential fines, we could be subject to mandatory corrective action due to a data security incident, which could adversely affect our business operations and result in substantial costs for years to come.

Changes in how network operators manage data that travel across their networks could harm our business.

Our business relies upon the ability of consumers to access high-quality streaming content through the internet. As a result, the growth of our business depends on our users’ ability to obtain low-cost, high-speed access to the internet, which relies in part on the network operators’ continuing willingness to upgrade and maintain their equipment as needed to sustain a robust internet infrastructure as well as their continued willingness to preserve the open and interconnected nature of the internet. We exercise no control over network operators, which makes us vulnerable to any errors, interruptions or delays in their operations. Any material disruption in internet services could harm our business.

To the extent that the number of internet users continues to increase, network congestion could adversely affect the reliability of our platform. We may also face increased costs of doing business if network operators engage in discriminatory practices with respect to streamed video content in an effort to monetize access to their networks by data providers. In the past, internet service providers have attempted to implement usage-based pricing, bandwidth caps and traffic “shaping” or throttling. To the extent network operators were to create tiers of internet access service and either charge us for access to these tiers or prohibit our content offerings from being available on some or all of these tiers, our quality of service could decline, our operating expenses could increase and our ability to attract and retain customers could be impaired, each of which would harm our business.

In addition, most network operators that provide consumers with access to the internet also provide these consumers with multichannel video programming. These network operators have an incentive to use their network infrastructure in a manner adverse to the continued growth and success of other companies seeking to distribute similar video programming. To the extent that network operators are able to provide preferential treatment to their own data and content, as opposed to ours, our business could be harmed.

We could become subject to litigation regarding intellectual property rights that could be costly, result in the loss of rights important to our devices and platform or otherwise harm our business.

Some internet, technology and media companies, including some of our competitors, own large numbers of patents, copyrights and trademarks, which they may use to assert claims against us. Third parties have asserted, and may in the future assert, that we have infringed, misappropriated or otherwise violated their intellectual property rights. As we face increasing competition, the possibility of intellectual property rights claims against us will grow. Plaintiffs who have no relevant product revenue may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us. The cost of patent litigation or other proceedings, even if resolved in our favor, could be substantial. Some of our competitors may be better able to sustain the costs of such litigation or proceedings because of their substantially greater financial resources. Patent litigation and other proceedings may also require significant management time and divert management from our business. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could impair our ability to compete in the marketplace. The occurrence of any of the foregoing could harm our business.

As a result of intellectual property infringement claims, or to avoid potential claims, we may choose or be required to seek licenses from third parties. These licenses may not be available on commercially reasonable terms, or at all. Even if we are able to obtain a license, the license would likely obligate us to pay license fees or royalties or both, and the rights granted to us might be nonexclusive, with the potential for our competitors to gain access to the same intellectual property. In addition, the rights that we secure under intellectual property licenses may not include rights to all of the intellectual property owned or controlled by the licensor, and the scope of the licenses granted to us may not include rights covering all of the products and services provided by us and our licensees. Furthermore, an adverse outcome of a dispute may require us to pay damages, potentially including treble damages and attorneys’ fees, if we are found to have willfully infringed a party’s intellectual property; cease making, licensing or using technologies that are alleged to infringe or misappropriate the intellectual property of others; expend additional development resources to redesign our solutions; enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content or materials; and to indemnify our partners and other third parties. In addition, any lawsuits regarding intellectual property rights, regardless of their success, could be expensive to resolve and would divert the time and attention of our management and technical personnel.

Under our agreements with many of our content publishers, licensees, distributors, retailers, contract manufacturers and suppliers, we are required to provide indemnification in the event our technology is alleged to infringe upon the intellectual property rights of third parties.

In certain of our agreements we indemnify our content publishers, licensees, distributors, retailers, manufacturing partners and suppliers. We could incur significant expenses defending these partners if they are sued for patent infringement based on allegations related to our technology. If a partner were to lose a lawsuit and in turn seek indemnification from us, we also could be subject to significant monetary liabilities. In addition, because the devices sold by our licensing partners and TV brands often involve the use of third-party technology, this increases our exposure to litigation in circumstances where there is a claim of infringement asserted against the player in question, even if the claim does not pertain to our technology.

If we fail to protect or enforce our intellectual property or proprietary rights, our business and operating results could be harmed.*

We regard the protection of our patents, trade secrets, copyrights, trademarks, trade dress, domain names and other intellectual property or proprietary rights as critical to our success. We strive to protect our intellectual property rights by relying on federal, state and common law rights, as well as contractual restrictions. We seek to protect our confidential proprietary information, in part, by entering into confidentiality agreements and invention assignment agreements with all our employees, consultants, contractors, advisors and any third parties who have access to our proprietary know-how, information or technology. However, we cannot be certain that we have executed such agreements with all parties who may have helped to develop our intellectual property or who had access to our proprietary information, nor can we be certain that our agreements will not be breached. Any party with whom we have executed such an agreement could potentially breach that agreement and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. We cannot guarantee that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. Detecting the disclosure or misappropriation of a trade secret and enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, time-consuming and could result in substantial costs and the outcome of such a claim is unpredictable. Further, the laws of certain foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States. As a result, we may encounter significant problems in protecting and defending our intellectual property or proprietary rights both in the United States and abroad. If we are unable to prevent the disclosure of our trade secrets to third parties, or if our competitors independently develop any of our trade secrets, we may not be able to establish or maintain a competitive advantage in our market, which could harm our business.

We have filed and will in the future file patent applications on inventions that we deem to be innovative. There is no guarantee that our patent applications will issue as granted patents, that the scope of the protection gained will be sufficient or that an issued patent may subsequently be deemed invalid or unenforceable. Patent laws, and scope of coverage afforded by them, have recently been subject to significant changes, such as the change to “first-to-file” from “first-to-invent” resulting from the Leahy-Smith America Invents Act. This change in the determination of inventorship may result in inventors and companies having to file patent applications more frequently to preserve rights in their inventions, which may favor larger competitors that have the resources to file more patent applications. Another change to the patent laws may incentivize third parties to challenge any issued patent in the United States Patent and Trademark Office (“USPTO”), as opposed to having to bring such an action in U.S. federal court. Any invalidation of a patent claim could have a significant impact on our ability to protect the innovations contained within our devices and platform and could harm our business.

The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other provisions to maintain patent applications and issued patents. We may fail to take the necessary actions and to pay the applicable fees to obtain or maintain our patents. Noncompliance with these requirements can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, competitors might be able to use our technologies and enter the market earlier than would otherwise have been the case.

We pursue the registration of our domain names, trademarks and service marks in the United States and in certain locations outside the United States. We are seeking to protect our trademarks, patents and domain names in an increasing number of jurisdictions, a process that is expensive and time-consuming and may not be successful or which we may not pursue in every jurisdiction in which we conduct business.

Litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets or determine the validity and scope of proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in substantial costs, adverse publicity or diversion of management and technical resources, any of which could adversely affect our business and operating results. If we fail to maintain, protect and enhance our intellectual property or proprietary rights, our business may be harmed.

We and our third-party contractors collect, process, transmit and store the personal information of our users, which creates legal obligations and exposes us to potential liability.*

We collect, process, transmit and store information about our users and their device usage patterns, and rely on third-party contractors to collect, process, transmit and store personal information of our users, including our users’ credit card data. Further, we and third parties use tracking technologies, including cookies, device identifiers and related technologies, to help us manage and track our users’ interactions with our platform, devices, website and partners’ content streaming channels and deliver relevant advertising and personalized content for ourselves and on behalf of our partners on our devices.

We collect information about the interaction of users with our devices, our advertisements, and our partners’ streaming channels. To deliver relevant advertisements effectively, we must successfully leverage this data as well as data provided by third parties. Our ability to collect and use such data could be restricted by a number of factors, including consumers having the ability to refuse consent to or opt out from our collection and use of this data for advertising purposes or the ability of our advertisers to use such data to provide more relevant advertisements, restrictions imposed by advertisers, content publishers and service providers, changes in technology, and new developments in laws, regulations and industry standards. For example, European Union laws prohibit access to or storage of information on a user's device that is not "strictly necessary" to provide a user-requested service or used for the "sole purpose" of a transmission unless the user has provided unambiguous, affirmative consent, and users may choose not to provide this consent to collection of information which is used for advertising purposes. Any restrictions on our ability to collect or use data could harm our ability to grow our revenue, particularly our advertising revenue which depends on engaging the relevant recipients of advertising campaigns.

Various federal, state, and foreign laws and regulations govern the collection, use, retention, sharing and security of the data we receive from and about our users. The regulatory environment for the collection and use of consumer data by device manufacturers, online service providers, content distributors, advertisers and publishers is very unsettled in the United States and internationally. Privacy groups and government bodies, including the Federal Trade Commission (“FTC”) state attorneys general, and the European Commission and European data protection authorities, have increasingly scrutinized privacy issues with respect to devices that link personal identities or user and device data, with data collected through the internet, and we expect such scrutiny to continue to increase. The United States and foreign governments have enacted and are considering regulations that could significantly restrict industry participants’ ability to collect, use and share personal information and pseudonymous data, such as by regulating the level of consumer notice and consent required before a company can place cookies or other tracking technologies. For example, we have been subject to the EU General Data Protection Regulation (“GDPR”) since May 2018. The GDPR includes detailed requirements related

to the collection, storage and use of personal data related to people resident in the EU or which is processed in the context of EU operations and places new data protection obligations and restrictions on organizations and may requires us to make further change our policies and procedures in the future beyond what we have already done. Further, following a referendum in June 2016 in which voters in the United Kingdom approved an exit from the European Union, the United Kingdom government has initiated a process to leave the European Union, known as Brexit. Brexit has created uncertainty with regard to the regulation of data protection in the United Kingdom. In particular, although the United Kingdom enacted a Data Protection Act in May 2018 the GDPR, a level of uncertainty remains regarding how data transfers to and from the United Kingdom will be regulated after Brexit. We made changes to our data protection compliance program to prepare for the GDPR and will continue to monitor the implementation and evolution of global data protection regulations, but if we are not compliant with GDPR requirements, we may be subject to significant fines and our business may be harmed. Other countries have also proposed or passed legislation with data usage limitations similar to that of the GDPR.

The U.S. data protection legal landscape continues to evolve, with California and Nevada having recently passed broad-based data protection legislation and with states and the federal government continuing to consider additional data protection legislation. The potential effects of this legislation are far-reaching and may require us to modify our data processing practices and policies and to incur substantial costs and expenses in an effort to comply. Effective October 1, 2019, Nevada amended its existing Security of Personal Information Law (“SPI Law”) to now require, among other things, that businesses provide an online mechanism or toll-free phone number to intake requests from consumers to opt out of the sale of their personal data. The California Consumer Privacy Act (“CCPA”) goes into effect in January 2020 and gives California residents expanded rights to access and require deletion of their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used. The CCPA also provides for civil penalties for violations, as well as a private right of action for data breaches that may increase data breach litigation. The CCPA was recently amended, and it is possible that it will be amended again before it goes into effect.

We are continuing to assess the impact of new and proposed data protection laws and proposed amendments to existing laws on our business.

Applicable data privacy and security laws also obligate us to employ reasonable security measures that are appropriate to the nature of the data we collect and process and the risks attendant to our data processing activities, among other factors, in order to protect personal information from unauthorized access or disclosure, or accidental or unlawful destruction, loss, or alteration. We have implemented security measures that we believe are appropriate, but we cannot be sure a regulator would deem our security measures to be appropriate given the lack of prescriptive measures in certain data protection laws. Without more specific guidance, we cannot know whether our chosen security safeguards are adequate according to each applicable data protection law. Given the evolving nature of security threats and evolving safeguards, we cannot be sure that our chosen safeguards will protect against security threats to our business. Moreover, data protection laws impose on us responsibility for our employees and third parties that assist with aspects of our data processing.

In addition, some countries are considering or have enacted 'data localization' laws requiring that user data regarding users in their country be maintained in their country. Maintaining local data centers in individual countries could increase our operating costs significantly. In addition, we expect that, in addition to the business as usual costs of compliance, the evolving regulatory interpretation and enforcement of new laws such as the GDPR and CCPA and other domestic and foreign data protection laws will lead to increased operational and compliance costs and will require us to continually monitor and, where necessary, make changes to our operations, policies, and procedures. Any failure or perceived failure to comply with privacy-related legal obligations, or any compromise of security of user data, may result in governmental enforcement actions, litigation, contractual indemnity or public statements against us by consumer advocacy groups or others. In addition to potential liability, these events could harm our business.

We have incurred, and will continue to incur, expenses to comply with privacy and security standards and protocols imposed by law, regulation, industry standards and contractual obligations. Increased regulation of data collection, use and security practices, including self-regulation and industry standards, changes in existing laws, enactment of new laws, increased enforcement activity, and changes in interpretation of laws, could increase our cost of compliance and operation, limit our ability to grow our business or otherwise harm our business.

If service operators refuse to authenticate streaming channels on our platform, our users may be restricted from accessing certain content on our platform and our business may be harmed.

Certain service operators, including pay TV providers, have from time to time refused to grant our users access to streaming content through “TV Everywhere” channels and have made that content available only on certain devices favored by such service operators, including devices offered by that service operator or its partners. If major service operators do not authenticate popular TV Everywhere channels on our platform, we may be unable to offer a broad selection of popular streaming channels and consumers may

not purchase or use our streaming players. If we are unable to continue to provide access to popular streaming channels on our platform, our business may be harmed.

United States or international rules that permit ISPs to limit internet data consumption by users, including unreasonable discrimination in the provision of broadband internet access services, could harm our business.*

Laws, regulations or court rulings that adversely affect the popularity or growth in use of the internet, including decisions that undermine open and neutrally administered internet access, could decrease customer demand for our service offerings, may impose additional burdens on us or could cause us to incur additional expenses or alter our business model.

On February 26, 2015, the FCC adopted open internet rules intended to protect the ability of consumers and content producers to send and receive non-harmful, lawful information on the internet, known as the Open Internet Order. The FCC’s Open Internet Order prohibited broadband internet access service providers from: (i) blocking access to legal content, applications, services or non-harmful devices; (ii) throttling, impairing or degrading performance based on content, applications, services or non-harmful devices; and (iii) charging more for favorable delivery of content or favoring self-provisioned content over third-party content. The Open Internet Order also prohibited broadband internet access service providers from unreasonably interfering with consumers’ ability to select, access and use the lawful content, applications, services or devices of their choosing as well as edge providers’ ability to make lawful content, applications, services or devices available to consumers.

In January 2018, the FCC released a new order, known as the Restoring Internet Freedom Order, that repealed most of the blocking, throttling, and paid prioritization restrictions adopted in the Open Internet Order. The Restoring Internet Freedom Order reclassified broadband internet access service as a non-common carrier “information service” and repealed rules that had prohibited broadband internet access service providers from: (i) blocking access to legal content, applications, services or non-harmful devices; (ii) throttling, impairing or degrading performance based on content, applications, services or non-harmful devices; and (iii) charging more for favorable delivery of content or favoring self-provisioned content over third-party content. The Restoring Internet Freedom Order continued to require internet service providers to be transparent about their policies and network management practices, and subjected discriminatory practices to case-by-case assessment under antitrust and consumer protection laws. Most portions of the Restoring Internet Freedom Order went into effect on April 23, 2018 and the remainder went into effect on June 11, 2018. Numerous parties have filed judicial challenges to the Restoring Internet Freedom Order, and the litigation has been consolidated in the U.S. Court of Appeals for the District of Columbia Circuit. Oral arguments were heard on February 1, 2019. To the extent the courts or the agencies do not uphold or adopt sufficient safeguards to protect against discriminatory conduct, network operators may seek to extract fees from us or our content publishers to deliver our traffic or otherwise engage in blocking, throttling or other discriminatory practices, and our business could be harmed.

Several states are considering network neutrality legislation or regulation as well. On September 30, 2018, California Governor Jerry Brown signed open internet legislation into law, effective January 1, 2019. The California legislation codifies portions of the FCC’s rescinded Open Internet Order. The U.S. Department of Justice filed suit on September 30, 2018 to block implementation of the California law, and the broadband service provider trade associations CTIA, the National Cable & Telecommunications Association, the United States Telecom Association and the American Cable Association, have also sued California to invalidate the state’s net neutrality law on grounds that the law is preempted by the FCC’s Restoring Internet Freedom Order, among other claims. The California Attorney General has agreed to delay implementation of the law until the litigation is resolved. Meanwhile, at least three additional states (Oregon, Vermont and Washington) have enacted net neutrality legislation, and governors in at least six other states (Hawaii, Montana, New Jersey, New York, Rhode Island and Vermont) have signed executive orders requiring service providers contracting with state agencies to adhere to network neutrality principles. The regulatory framework for network neutrality thus remains unsettled and is subject to ongoing legislative and judicial review.

As we expand internationally, government regulation protecting the non-discriminatory provision of internet access may be nascent or non-existent. In those markets where regulatory safeguards against unreasonable discrimination are nascent or non-existent and where local network operators possess substantial market power, we could experience anti-competitive practices that could impede our growth, cause us to incur additional expenses or otherwise harm our business. Future regulations or changes in laws and regulations or their existing interpretations or applications could also hinder our operational flexibility, raise compliance costs and result in additional liabilities for us, which may harm our business.

Broadband internet providers are subject to government regulation and enforcement actions, and changes in current or future laws, regulations or enforcement actions that negatively impact our distributors or content publishers could harm our business.*

Upon the effective date of the FCC’s Restoring Internet Freedom Order, the FTC became primarily responsible for regulating broadband privacy and data security in the United States. The FTC follows an enforcement-focused approach to regulating broadband

privacy and security. Future FTC enforcement actions could cause us or our content publishers to alter advertising claims or alter or eliminate certain features or functionalities of our products or services which may harm our business. At the FCC, many broadband internet providers provide traditional telecommunications services that are subject to FCC and state rate regulation of intrastate telecommunications services, and are recipients of federal universal service fund payments, which are intended to subsidize telecommunications services in areas that are expensive to serve. Changes in rate regulations or in universal service funding rules, either at the federal or state level, could affect these broadband internet providers’ revenue and capital spending plans. In addition, various international regulatory bodies have jurisdiction over non-United States broadband internet providers. The Nevada SPI Law and the CCPA also apply to broadband internet providers that do business in Nevada and California, respectively. To the extent these broadband internet providers are adversely affected by laws or regulations regarding their business, products or service offerings, our business could be harmed.

Our financial results may be adversely affected by changes in accounting principles applicable to us.

Generally accepted accounting principles in the United States (“U.S. GAAP”) are subject to interpretation by the Financial Accounting Standards Board, the FASB, the SEC, and other various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported results of operations and may even affect the reporting of transactions completed before the announcement or effectiveness of a change. For example, we recently adopted Accounting Standards Codification, Revenue from Contracts with Customers (Topic 606), using the modified retrospective method. We applied the new revenue standard to all contracts that were not completed as of January 1, 2018. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those prior periods. It is difficult to predict the impact of future changes to accounting principles or our accounting policies, any of which could harm our business.

If government regulations or laws relating to the internet, video or other areas of our business change, we may need to alter the manner in which we conduct our business or our business could be harmed.*

We are subject to general business regulations and laws, as well as regulations and laws specific to the internet and online services, which may include laws and regulations related to data privacy and security, consumer protection, data localization, law enforcement access to data, encryption, telecommunications, social media, payment processing, taxation, intellectual property, competition, electronic contracts, internet access, net neutrality, advertising, calling and texting, content restrictions, and accessibility, among others. We cannot guarantee that we have been or will be fully compliant in every jurisdiction. Litigation and regulatory proceedings are inherently uncertain, and the laws and regulations governing issues such as data privacy and security, payment processing, taxation, net neutrality, video, telecommunications, e-commerce tariffs and consumer protection related to the internet continue to develop. For example, laws relating to the liability of providers of online services for activities of their users and other third parties have been tested by a number of claims, including actions based on invasion of privacy and other torts, unfair competition, copyright and trademark infringement, and other theories based on the nature and content of the materials searched, the advertisements posted, actions taken or not taken by providers in response to user activity or the content provided by users. Congress has also recently enacted legislation related to liability of providers of online services and may continue to legislate in this area. The recently enacted CCPA and recently amended Nevada SPI Law also apply to entities that do business in California and Nevada, respectively, and impose a number of new requirements on internet and online services. Moreover, as internet commerce and advertising continues to evolve, increasing regulation by federal, state and foreign regulatory authorities becomes more likely.

As we develop new services and devices, and improve our TV streaming platform, we may also be subject to new laws and regulations specific to such technologies. For example, in developing our Roku TV reference design, we were required to understand, address and comply with an evolving regulatory framework for developing, manufacturing, marketing and selling TVs. If we fail to adequately address or comply with such regulations regarding the manufacture and sale of TVs, we may be subject to fines or sanctions, and our licensees may be unable to sell Roku TVs at all, which would harm our business and our ability to grow our user base.

Laws relating to data privacy and security, data localization, law enforcement access to data, encryption, and similar activities continue to proliferate, often with little harmonization between jurisdictions and little guidance. A number of existing bills are pending in the U.S. Congress and other government bodies that contain provisions that would regulate, for example, how companies can use cookies and other tracking technologies to collect, use and share user information. The CCPA also imposes requirements on certain tracking activity, and we are continuing to assess the impact of the CCPA and proposed amendments to the law on our business. The European Union has already enacted laws requiring advertisers or companies like ours to, for example, obtain unambiguous, affirmative consent from users for the placement of cookies or other tracking technologies and the delivery of relevant advertisements. If we or the third parties that we work with, such as contract payment processing services, content publishers, vendors or developers violate or are alleged to violate applicable privacy or security laws, industry standards, our contractual obligations, or our policies,

such violations and alleged violations may also put our users’ information at risk and could in turn harm our business and reputation and subject us to potential liability. Any of these consequences could cause our users, advertisers or publishers to lose trust in us, which could harm our business. Furthermore, any failure on our part to comply with these laws may subject us to liability and reputational harm.

Our use of data to deliver relevant advertising and other services on our platform places us and our content publishers at risk for claims under various unsettled laws, including the Video Privacy Protection Act (“VPPA”). Some of our content publishers have been engaged in litigation over alleged violations of the VPPA relating to activities on our platform in connection with advertising provided by unrelated third parties. The Federal Trade Commission has also revised its rules implementing the Children’s Online Privacy Protection Act (“COPPA Rules”) broadening the applicability of the COPPA Rules, including the types of information that are subject to these regulations, and could limit the information that we or our content publishers and advertisers may collect and use through certain content publishers, the content of advertisements and in relation to certain channel partner content. The CCPA also imposes certain opt in and opt out requirements for certain information about minors. We and our content publishers and advertisers could be at risk for violation or alleged violation of these and other privacy, advertising, or similar laws.

Our actual or perceived failure to adequately protect personal data and confidential information could harm our business.*

A variety of state, national, foreign, and international laws and regulations apply to the collection, use, retention, protection, disclosure, security, transfer and other processing of personal data. These privacy and data protection-related laws and regulations are evolving, with new or modified laws and regulations proposed and implemented frequently and existing laws and regulations subject to new or different interpretations. In addition, each state and the District of Columbia, as well as some foreign nations, have passed laws requiring notification to regulatory authorities and/or to affected users within a specific timeframe when there has been a security breach involving personal data as well as impose additional obligations for companies. For example, the CCPA was signed into law on June 28, 2018 and largely takes effect on January 1, 2020 (and enforcement of some of the provisions will not be immediately active) and the amendments to the Nevada SPI Law will take effect on October 1, 2019. These laws impose additional obligations on companies that process certain information about California and Nevada residents, respectively. Compliance with these laws and regulations can be costly, could delay or impede the development of new products, and may cause reputational harm.

As part of our data protection compliance program, we ensure that we have approved data transfer mechanisms in place to provide adequacy for the transfer of personal data from the European Economic Area to the United States. However, there are legal challenges in the European Union about the adequacy of these data transfer mechanisms generally and, if these challenges are successful, this may adversely affect our ability to transfer personal data from the European Economic Area to the United States.

We will continue to review our business practices and may find it necessary or desirable to make changes to our personal data handling to cause our transfer and receipt of EEA residents’ personal data to be legitimized under applicable European law. The regulation of data privacy in the EU continues to evolve, and it is not possible to predict the ultimate effect of evolving data protection regulation and implementation over time. Member states also have some flexibility to supplement the GDPR with their own laws and regulations and may apply stricter requirements for certain data processing activities.

While we have implemented administrative, physical and electronic security measures to protect against reasonably foreseeable loss, misuse and alteration of personal data and confidential information (e.g., protected content or intellectual property), cyberattacks on companies have increased in frequency and potential impact in recent years and, if successful against us, may harm our reputation and business and subject us to potential liability despite reasonable precautions. As discussed above, we cannot be certain that our chosen security measures will be deemed adequate or reasonable by regulators in all instances.

If we are not able to comply with these laws or regulations or if we become liable under new laws or regulations, we could be directly harmed, and we may be forced to implement new measures to reduce our exposure to this liability. This may require us to expend substantial resources or to suspend or discontinue certain products or services, which may harm our business. In addition, the increased attention focused upon liability issues as a result of lawsuits and legislative proposals could harm our business. Any actual or perceived inability to adequately protect our users’ privacy may render our products or services less desirable and could harm our reputation and business. Any costs incurred as a result of this potential liability could harm our business.

If we are found liable for content that we distribute through our platform, our business could be harmed.

As a distributor of content, we face potential liability for negligence, copyright, patent or trademark infringement, public performance royalties or other claims based on the nature and content of materials that we distribute. The Digital Millennium Copyright Act (“the DMCA”) is intended, in part, to limit the liability of eligible service providers for caching, hosting or linking to, user content that includes materials that infringe copyrights or other rights. We rely on the protections provided by the DMCA in conducting our business. However, the DMCA and similar statutes and doctrines that we may rely on in the future is subject to uncertain judicial interpretation and regulatory and legislative amendments. Moreover, the DMCA only provides protection primarily in the United States. If the rules around these statutes and doctrines change, if international jurisdictions refuse to apply similar

protections or if a court were to disagree with our application of those rules to our business, we could incur liability and our business could be harmed. If we become liable for these types of claims as a result of the content that is streamed over our platform, then our business may suffer. Litigation to defend these claims could be costly and the expenses and damages arising from any liability could harm our business. Our insurance may not be adequate to cover these types of claims or any liability that may be imposed on us.

In addition, we may be adversely impacted if copyright holders assert claims, or commence litigation, alleging copyright infringement against the developers of channels that are distributed on our platform. While our platform policies prohibit streaming content on our platform without distribution rights from the copyright holder, and we maintain processes and systems for the reporting and removal of infringing content, in certain instances our platform has been misused by unaffiliated third parties to unlawfully distribute copyrighted content. For example, we are involved in litigation in Mexico that was commenced in May 2017 by a large Mexican pay TV and internet access provider. We were not named as a defendant in this case, as the case principally targeted entities that are alleged to sell unlicensed content to consumers using our platform, among other means. Involvement in these legal proceedings has been complicated and has drawn management time and company resources. At the commencement of this case, however, a court issued a temporary ban on the importation and sale of Roku devices in Mexico. In October 2018, the ban on sales was lifted by a Federal Court in Mexico; however, the underlying litigation may continue. Our involvement in this litigation caused us to incur legal expenses and other costs and has drawn management time and other company resources away from other matters. Our continuing involvement in this litigation, or similar legal matters in the future, could be disruptive to our business. If content partners or distributors in Latin America or in any other country are influenced by these proceedings and are deterred from working with us to sell players or other products or to maintain their channels or sell advertising on our platform, this could impair our ability to implement our international expansion plans.

Our involvement in any such legal matters now or in the future, could cause us to incur significant legal expenses and other costs, and be disruptive to our business.

Our devices are highly technical and may contain undetected hardware errors or software bugs, which could manifest themselves in ways that could harm our reputation and our business.

Our devices and those of our licensees are highly technical and have contained and may in the future contain undetected software bugs or hardware errors. These bugs and errors can manifest themselves in any number of ways in our devices or our platform, including through diminished performance, security vulnerabilities, data quality in logs or interpretation of data, malfunctions or even permanently disabled devices. Some errors in our devices may only be discovered after a device has been shipped and used by users and may in some cases only be detected under certain circumstances or after extended use. We update our software on a regular basis and, despite our quality assurance processes, we could introduce bugs in the process of updating our software. The introduction of a serious software bug could result in devices becoming permanently disabled. We offer a limited one year warranty in the United States and any such defects discovered in our players after commercial release could result in loss of revenue or delay in revenue recognition, loss of customer goodwill and users and increased service costs, any of which could harm our business, operating results and financial condition. We could also face claims for product or information liability, tort or breach of warranty, or other violations of laws or regulations. In addition, our player contracts with users contain provisions relating to warranty disclaimers and liability limitations, which may not be upheld. Defending a lawsuit, regardless of its merit, is costly and may divert management’s attention and adversely affect the market’s perception of Roku and our devices. In addition, if our business liability insurance coverage proves inadequate or future coverage is unavailable on acceptable terms or at all, our business could be harmed.

Components used in our devices may fail as a result of manufacturing, design or other defects over which we have no control and render our devices permanently inoperable.

We rely on third-party component suppliers to provide certain functionalities needed for the operation and use of our devices. Any errors or defects in such third-party technology could result in errors in our devices that could harm our business. If these components have a manufacturing, design or other defect, they can cause our devices to fail and render them permanently inoperable. For example, the typical means by which our users connect their home networks to our devices is by way of a Wi-Fi access point in the home network router. If the Wi-Fi receiver in our device fails, then our device cannot detect a home network’s Wi-Fi access point, and our device will not be able to display or deliver any content to the TV screen. As a result, we may have to replace these devices at our sole cost and expense. Should we have a widespread problem of this kind, our reputation in the market could be adversely affected and our replacement of these devices would harm our business.

If we are unable to obtain necessary or desirable third-party technology licenses, our ability to develop new devices or platform enhancements may be impaired.

We utilize commercially available off-the-shelf technology in the development of our devices and platform. As we continue to introduce new features or improvements to our devices and the Roku platform, we may be required to license additional technologies from third parties. These third-party licenses may be unavailable to us on commercially reasonable terms, if at all. If we are unable to

obtain necessary third-party licenses, we may be required to obtain substitute technologies with lower quality or performance standards, or at a greater cost, any of which could harm the competitiveness of our devices, platform and our business.

Our use of open source software could impose limitations on our ability to commercialize our devices and our TV streaming platform.

We incorporate open source software in our TV streaming platform. From time to time, companies that incorporate open source software into their products have faced claims challenging the ownership of open source software and/or compliance with open source license terms. Therefore, we could be subject to suits by parties claiming ownership of what we believe to be open source software or noncompliance with open source licensing terms. Although we monitor our use of open source software, the terms of many open source software licenses have not been interpreted by U.S. courts, and there is a risk that such licenses could be construed in a manner that could impose unanticipated conditions or restrictions on the sale of our devices. In such event, we could be required to make our proprietary software generally available to third parties, including competitors, at no cost, to seek licenses from third parties in order to continue offering our devices, to re-engineer our devices or to discontinue the sale of our devices in the event re-engineering cannot be accomplished on a timely basis or at all, any of which could harm our business.

The quality of our customer support is important to our users and licensees, and if we fail to provide adequate levels of customer support we could lose users and licensees, which would harm our business.

Our users and licensees depend on our customer support organization to resolve any issues relating to devices. A high level of support is critical for the successful marketing and sale of devices. We currently outsource our customer support operation to a third-party customer support organization. If we do not effectively train, update and manage our third-party customer support organization to assist our users, and if that support organization does not succeed in helping them quickly resolve issues or provide effective ongoing support, it could adversely affect our ability to sell our devices to users and harm our reputation with potential new users and our licensees.

We need to maintain operational and financial systems that can support our expected growth, increasingly complex business arrangements, and rules governing revenue and expense recognition and any inability or failure to do so could adversely affect our billing services and financial reporting.*

We have increasingly complex business arrangements with our content publishers and licensees, and the rules that govern revenue and expense recognition in our business are increasingly complex. To manage the expected growth of our operations and increasing complexity, we must maintain operational and financial systems, procedures and controls and continue to increase systems automation to reduce reliance on manual operations. An inability to do so will negatively affect our billing services and financial reporting. Our current and planned systems, procedures and controls may not be adequate to support our complex arrangements and the rules governing revenue and expense recognition for our future operations and expected growth. Delays or problems associated with any improvement or expansion of our operational and financial systems and controls could adversely affect our relationships with our users, content publishers or licensees; cause harm to our reputation and brand; and could also result in errors in our financial and other reporting.

If we fail to maintain effective internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our Class A common stock may be adversely affected.*

We are required to maintain internal control over financial reporting and to report any material weaknesses in such internal control. Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires that we furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting. This assessment must include disclosure of any material weaknesses identified by our management in our internal control over financial reporting. Our independent registered public accounting firm also attests to the effectiveness of our internal control over financial reporting. If we have a material weakness in our internal control over financial reporting in the future, we may not detect errors on a timely basis and our financial statements may be materially misstated. If we identify material weaknesses in our internal control over financial reporting, are unable to continue to comply with the requirements of Section 404 in a timely manner, are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, and the market price of our Class A common stock could be adversely affected. In addition, we could become subject to investigations by the stock exchange on which our Class A common stock is listed, the SEC, or other regulatory authorities, which could require additional financial and management resources.

We may pursue acquisitions, which involve a number of risks, and if we are unable to address and resolve these risks successfully, such acquisitions could harm our business.

We may in the future acquire businesses, products or technologies to expand our offerings and capabilities, user base and business. We have evaluated, and expect to continue to evaluate, a wide array of potential strategic transactions; however, we have limited experience completing or integrating acquisitions. Any acquisition could be material to our financial condition and results of operations and could require us to raise capital in the equity markets or issue additional equity and any anticipated benefits from an acquisition may never materialize. In addition, the process of integrating acquired businesses, products or technologies may create unforeseen operating difficulties and expenditures. Acquisitions in international markets would involve additional risks, including those related to integration of operations across different cultures and languages, currency risks and the particular economic, political and regulatory risks associated with specific countries. We may not be able to address these risks successfully, or at all, without incurring significant costs, delays or other operational problems and if we were unable to address such risks successfully our business could be harmed.

We have a credit facility that provides our lender with a first-priority lien against substantially all of our assets and contains financial covenants and other restrictions on our actions that may limit our operational flexibility or otherwise adversely affect our financial condition.*

We entered into a credit agreement among us, as borrower, the lenders and issuing banks from time to time party thereto, and Morgan Stanley Senior Funding, Inc., or the Agent providing for a (i) a four-year revolving credit facility in the aggregate principal amount of up to $100.0 million, or the Revolving Credit Facility, (ii) a four-year delayed draw term loan A facility in the aggregate principal amount of up to $100.0 million, the Term Loan A Facility and (iii) an uncommitted incremental facility subject to certain conditions, collectively, the Credit Agreement. The Credit Agreement contains a number of affirmative and negative covenants, which may restrict our current and future operations, particularly our ability to respond to certain changes in our business or industry or take future actions. The Credit Agreement also contains a financial covenant requiring us to maintain a minimum adjusted quick ratio of at least 1.00 to 1.00, tested as of the last day of any fiscal quarter on the basis of the prior period of our four consecutive fiscal quarters. Pursuant to the Credit Agreement, we granted the Agent a security interest in substantially all of our assets. See the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources— Senior Secured Term Loan A and Revolving Credit Facilities.”

If we fail to comply with the covenants, make payments as specified in the Credit Agreement, or undergo any other event of default contained in the Credit Agreement, the Agent could declare an event of default, which would give it the right to terminate the commitments to provide additional loans and declare any borrowings outstanding, together with accrued and unpaid interest and fees, to be immediately due and payable. In addition, the Agent would have the right to proceed against the assets we provided as collateral pursuant to the Credit Agreement. If the debt under this credit facility was accelerated, we may not have sufficient cash or be able to sell sufficient assets to repay this debt, which would harm our business and financial condition.

If we fail to comply with the laws and regulations relating to the collection of sales tax and payment of income taxes in the various states in which we do business, we could be exposed to unexpected costs, expenses, penalties and fees as a result of our noncompliance, which could harm our business.

By engaging in business activities in the United States, we become subject to various state laws and regulations, including requirements to collect sales tax from our sales within those states, and the payment of income taxes on revenue generated from activities in those states. The laws and regulations governing the collection of sales tax for sales on our website and payment of income taxes are numerous, complex, and vary from state to state. A successful assertion by one or more states that we were required to collect sales or other taxes or to pay income taxes where we did not could result in substantial tax liabilities, fees and expenses, including substantial interest and penalty charges, which could harm our business.

New legislation that would change U.S. or foreign taxation of international business activities or other tax-reform policies could harm our business.

Reforming the taxation of international businesses has been a priority for U.S. politicians, and key members of the legislative and executive branches have proposed a wide variety of potential changes. Certain changes to U.S. tax laws could affect the tax treatment of our foreign earnings, as well as cash and cash equivalent balances we maintain outside the United States. Additionally, any changes in the U.S. or foreign taxation of such activities may increase our worldwide effective tax rate and the amount of taxes we pay and harm our business.

For example, the TCJA was enacted on December 22, 2017 and significantly reforms the Internal Revenue Code of 1986, as amended. The TCJA, among other things, includes changes to U.S. federal tax rates, imposes additional limitations on the

deductibility of interest, has both positive and negative changes to the utilization of future net operating loss carryforwards, allows for the expensing of certain capital expenditures, and puts into effect the migration from a “worldwide” system of taxation to a territorial system. The U.S. Department of Treasury has broad authority to issue regulations and interpretative guidance that may significantly impact how we will apply the law, which could affect our financial position and result of operations.

We may require additional capital to meet our financial obligations and support planned business growth, and this capital might not be available on acceptable terms or at all.*

We intend to continue to make significant investments to support planned business growth and may require additional funds to respond to business challenges, including the need to develop new devices and enhance our platform, maintain adequate levels of inventory to support our retail partners’ demand requirements, improve our operating infrastructure or acquire complementary businesses, personnel and technologies. Our primary uses of cash include operating costs such as personnel-related expenses and capital spending. Our future capital requirements may vary materially from those currently planned and will depend on many factors including our growth rate and the continuing market acceptance of our advertising platform, operating system and technology and players along with the timing and effort related to the introduction of new platform features, players, hiring of experienced personnel, the expansion of sales and marketing activities, as well as overall economic conditions. We entered into lease agreements for a corporate headquarters, and we started to incur material expenses beginning this year.

We may need to engage in equity or debt financings to secure additional funds. If we raise additional funds through future issuances of equity or convertible debt securities, our then existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our Class A common stock. Any debt financing we secure could involve additional restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. If we were to violate such restrictive covenants, we could incur penalties, increased expenses and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business.

We may not be able to obtain additional financing on terms favorable to us, if at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be significantly impaired, and our business may be harmed.

Our facilities are located near known earthquake fault zones, and the occurrence of an earthquake or other natural disaster could cause damage to our facilities and computer systems, which could require us to curtail or cease operations.

Our principal offices and a network operations center are located in the San Francisco Bay Area, an area known for earthquakes, and are thus vulnerable to damage. We are also vulnerable to damage from other types of disasters, including power loss, fire, floods, communications failures and similar events. If any disaster were to occur, our ability to operate our business at our facilities could be impaired.

Risks Related to Ownership of Our Class A Common Stock

The dual class structure of our common stock as contained in our amended and restated certificate of incorporation has the effect of concentrating voting control with those stockholders who held our stock prior to our IPO, including our executive officers, employees and directors and their affiliates, and limiting your ability to influence corporate matters. *

Our Class B common stock has 10 votes per share, and our Class A common stock has one vote per share. Our President and Chief Executive Officer, Anthony Wood, holds and controls the vote of a majority of shares of our outstanding common stock. Therefore Mr. Wood will have significant influence over our management and affairs and has the ability to control all matters requiring stockholder approval, including election of directors and significant corporate transactions, such as a merger or other sale of Roku or our assets, for the foreseeable future. If Mr. Wood’s employment with us is terminated, he will continue to have the same control over matters requiring stockholder approval.

In addition, the holders of Class B common stock collectively will continue to be able to control all matters submitted to our stockholders for approval even if their stock holdings represent less than 50% of the outstanding shares of our common stock. Because of the 10-to-1 voting ratio between our Class B and Class A common stock, the holders of our Class B common stock collectively will continue to control a majority of the combined voting power of our common stock even when the shares of Class B common stock represent as little as 10% of the combined voting power of all outstanding shares of our Class A and Class B common stock. This concentrated control will limit your ability to influence corporate matters for the foreseeable future, and, as a result, the market price of our Class A common stock could be adversely affected.

Future transfers by holders of Class B common stock will generally result in those shares converting to Class A common stock, which will have the effect, over time, of increasing the relative voting power of those holders of Class B common stock who retain their shares in the long term. As a result of such transfers as of June 30, 2019, Mr. Wood controls a majority of the combined voting power of our Class A and Class B common stock even though he owns 64% of the outstanding Class A and Class B common stock. As a board member, Mr. Wood owes a fiduciary duty to our stockholders and must act in good faith in a manner he reasonably believes to be in the best interests of our stockholders. As a stockholder, even a controlling stockholder, Mr. Wood is entitled to vote his shares in his own interests, which may not always be in the interests of our stockholders generally. This concentrated control could delay, defer, or prevent a change of control, merger, consolidation, or sale of all or substantially all of our assets that our other stockholders support, or conversely this concentrated control could result in the consummation of such a transaction that our other stockholders do not support. This concentrated control could also discourage a potential investor from acquiring our Class A common stock, which has limited voting power relative to the Class B common stock and might harm the trading price of our Class A common stock.

We have not elected to take advantage of the “controlled company” exemption to the corporate governance rules for companies listed on The Nasdaq Global Select Market.

The trading price of our Class A common stock has been, and may continue to be, volatile, and the value of our Class A common stock may decline.*

The market price of our Class A common stock has been and may continue to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, including:

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actual or anticipated fluctuations in our financial condition and operating results;

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changes in projected operational and financial results;

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loss by us of key content publishers;

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changes in laws or regulations applicable to our devices or platform;

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the commencement or conclusion of legal proceedings that involve us;

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actual or anticipated changes in our growth rate relative to our competitors;

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announcements of new products or services by us or our competitors;

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announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or

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capital-raising activities or commitments;

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additions or departures of key personnel;

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issuance of new or updated research or reports by securities analysts;

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the use by investors or analysts of third-party data regarding our business that may not reflect our financial performance;

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fluctuations in the valuation of companies perceived by investors to be comparable to us;

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sales of our Class A common stock;

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share price and volume fluctuations attributable to inconsistent trading volume levels of our shares; and

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general economic and market conditions.

Furthermore, the stock markets frequently experience extreme price and volume fluctuations that affect the market prices of equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political and market conditions such as recessions, elections, interest rate changes or international currency fluctuations, may negatively impact the market price of our Class A common stock. As a result of such fluctuations, you may not realize any return on your investment in us and may lose some or all of your investment. In the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the target of this type of litigation in the future, which could result in substantial costs and divert our management’s attention from other business concerns.

Future sales and issuances of our capital stock or rights to purchase capital stock could result in additional dilution of the percentage ownership of our stockholders and could cause our stock price to decline.*

We may issue additional securities in the future and from time to time. Future sales and issuances of our capital stock or rights to purchase our capital stock could result in substantial dilution to our existing stockholders. We may sell or issue Class A common

stock, convertible securities and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time. If we sell any such securities in subsequent transactions, investors may be materially diluted. New investors in such subsequent transactions could gain rights, preferences and privileges senior to those of holders of our Class A common stock.

Future sales of shares by existing stockholders could cause our stock price to decline.

If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our Class A common stock in the public market, the trading price of our Class A common stock could decline. All of our outstanding Class A shares are eligible for sale in the public market, other than shares and options exercisable held by directors, executive officers and other affiliates that are subject to volume limitations under Rule 144 of the Securities Act. In addition, we have reserved shares for future issuance under our equity incentive plan. Our employees, other service providers, and directors are subject to our quarterly trading window, which generally opens at the start of the second full trading day after the public dissemination of our annual or quarterly financial results and closes (i) with respect to the first, second and third quarter of each year, at the end of the fifteenth day of the last month of the such quarter and (ii) with respect to the fourth quarter of each year, at the end of the trading day on the Wednesday before Thanksgiving. These employees, service providers and directors may also sell shares during a closed window periods pursuant to trading plans that comply with the requirements of Rule 10b5-1(c)(1) under the Exchange Act. When these shares are issued and subsequently sold, it would be dilutive to existing stockholders and the trading price of our Class A common stock could decline.

If securities or industry analysts do not publish research or publish unfavorable research about our business, our stock price and trading volume could decline.

A limited number of equity research analysts provide research coverage of our Class A common stock, and we cannot assure you that such equity research analysts will adequately provide research coverage of our Class A common stock. A lack of adequate research coverage may adversely affect the liquidity and market price of our Class A common stock. To the extent we obtain equity research analyst coverage, we will not have any control of the analysts or the content and opinions included in their reports. The price of our Class A common stock could decline if one or more equity research analysts downgrade our stock or issue other unfavorable commentary or research. If one or more equity research analysts cease coverage of our company, or fail to publish reports on us regularly, demand for our stock could decrease, which in turn could cause our stock price or trading volume to decline.

We incur costs and demands upon management as a result of complying with the laws and regulations affecting public companies in the United States, which may harm our business.

As a public company listed in the United States, we incur significant legal, accounting and other expenses. In addition, changing laws, regulations and standards relating to corporate governance and public disclosure, including regulations implemented by the SEC and the Nasdaq Global Select Market, may increase legal and financial compliance costs and make some activities more time consuming. These laws, regulations and standards are subject to varying interpretations and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If, notwithstanding our efforts, we fail to comply with new laws, regulations and standards, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Failure to comply with these rules might also make it more difficult for us to obtain certain types of insurance, including director and officer liability insurance, and we might be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our Board of Directors, on committees of our Board of Directors or as members of senior management.

We do not intend to pay dividends in the foreseeable future.

We have never declared or paid any cash dividends on our Class A or Class B common stock and do not intend to pay any cash dividends in the foreseeable future. We anticipate that we will retain all of our future earnings to grow our business and for general corporate purposes. Moreover, our outstanding loan and security agreements contain prohibitions on the payment of cash dividends on our capital stock. Any determination to pay dividends in the future will be at the discretion of our Board of Directors. Accordingly, investors must rely on sales of their Class A common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.

Provisions in our corporate charter documents and under Delaware law may prevent or frustrate attempts by our stockholders to change our management or hinder efforts to acquire a controlling interest in us, and the market price of our Class A common stock may be lower as a result.

There are provisions in our certificate of incorporation and bylaws that may make it difficult for a third-party to acquire, or attempt to acquire, control of Roku, even if a change in control was considered favorable by our stockholders.

Our charter documents also contain other provisions that could have an anti-takeover effect, such as:

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establishing a classified Board of Directors so that not all members of our Board of Directors are elected at one time;

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permitting the Board of Directors to establish the number of directors and fill any vacancies and newly created directorships;

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providing that directors may only be removed for cause;

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prohibiting cumulative voting for directors;

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requiring super-majority voting to amend some provisions in our certificate of incorporation and bylaws;

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authorizing the issuance of “blank check” preferred stock that our Board of Directors could use to implement a stockholder rights plan;

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eliminating the ability of stockholders to call special meetings of stockholders;

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prohibiting stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; and

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reflecting our two classes of common stock as described above.

Moreover, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibit a person who owns 15% or more of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner. Any provision in our certificate of incorporation or our bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock and could also affect the price that some investors are willing to pay for our Class A common stock.

Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware and the federal district courts of the United States of America will be the exclusive forums for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.*

Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for any derivative action or proceeding brought on our behalf; any action asserting a breach of fiduciary duty; any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our amended and restated certificate of incorporation or our bylaws; or any action asserting a claim against us that is governed by the internal affairs doctrine. This exclusive-forum provision, if permitted by applicable law, may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for certain disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees. If a court were to find this exclusive-forum provision in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business.

Our amended and restated certificate of incorporation further provides that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act. In December 2018, the Delaware Chancery Court issued an opinion invalidating such provision which we plan to appeal. Until a final resolution is reached on this matter, we will not attempt to enforce this provision of our certificate of incorporation. As a result, we may incur additional costs associated with resolving disputes that would otherwise be restricted by that provision in other jurisdictions, which could harm our business.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

		Incorporation by reference
Exhibit Number	Description	Form	SEC File No.	Exhibit	Filing Date

3.1	Amended and Restated Certificate of Incorporation of Roku, Inc.	8-K	001-38211	3.1	10/03/2017
3.2	Amended and Restated Bylaws of Roku, Inc.	S-1	333-220318	3.4	09/01/2017
4.1	Reference is made to Exhibits 3.1 through 3.2.
4.2	Form of Class A common stock certificate.	S-1/A	333-220318	4.1	09/18/2017
10.1*	Assignment and Assumption of Lease, Landlord’s Consent and First Amendment of Lease, dated as of April 30, 2019, by and among Roku, Inc., 8x8, Inc. and CAP Phase I, LLC.
10.2*	Second Amendment to Coleman Highline Office Lease by and between Roku, Inc. and Cap Phase 1, LLC dated April 30, 20189 (1155 Coleman Ave).
10.3*	Second Amendment to Coleman Highline Office Lease by and between Roku, Inc. and Cap Oz 34, LLC dated April 30, 2019 (1173/1167/1161 Coleman Ave).
10.4*	Incremental Assumption and Amendment No. 1 to Credit Agreement, dated as of May 3, 2019, by and among Roku, Inc., Morgan Stanley Senior Funding, Inc., as administrative agent and issuing bank, and the other issuing banks and lenders party thereto from time to time.
10.5	Roku, Inc. Amended and Restated Severance Benefit Plan	8-K	001-38211	99.1	7/16/2019
10.6*	Forms of Restricted Stock Unit Grant Notice and Award Agreement under 2017 Equity Incentive Plan (Employees).
10.7*	Forms of Restricted Stock Unit Grant Notice and Award Agreement under 2017 Equity Incentive Plan (Non-Employee Directors).
10.8*	Forms of Option Grant Notice and Option Agreement under 2017 Equity Incentive Plan (Non-Employee Directors).
10.9	Equity Distribution Agreement, dated May 16, 2019, by and between Roku, Inc. and Morgan Stanley & Co. LLC	8-K	001-38211	1.1	5/16/2019
31.1*	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	Inline XBRL Instance Document- the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*	Inline XBRL Taxonomy Extension Schema Document
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, has been formatted in Inline XBRL.

*	Filed herewith.

** These exhibits are furnished with this Quarterly Report on Form 10-Q and are not deemed filed with the Securities and Exchange Commission and are not incorporated by reference in any filing of Roku, Inc. under the Securities Act of 1933, as amended, or the Securities and Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language contained in such filings.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Roku, Inc.

Date: August 9, 2019	By:	/s/ Anthony Wood
		Anthony Wood
		President and Chief Executive Officer (Principal Executive Officer)

Date: August 9, 2019	By:	/s/ Steve Louden
		Steve Louden
		Chief Financial Officer (Principal Financial and Accounting Officer)

Exhibit 10.1

ASSIGNMENT AND ASSUMPTION OF LEASE, LANDLORD'S CONSENT AND FIRST

AMENDMENT OF LEASE

THIS ASSIGNMENT AND ASSUMPTION OF LEASE, LANDLORD'S CONSENT AND FIRST AMENDMENT OF LEASE ("Agreement") is made and entered into as of the 30^th day of April, 2019 ("Effective Date"), by and among 8X8, INC., a Delaware corporation ("Assignor") Roku Inc., a Delaware corporation ("Assignee"), and CAP Phase I, LLC, a Delaware limited liability company ("Landlord").

R E C I T A L S

A.Landlord, as landlord, and Assignor, as tenant, are parties to that certain Coleman Highline Office Lease, dated as of January 23, 2018 ("Lease"), pursuant to which Landlord is leasing to Assignor that certain five (5) story building located at 1143 Coleman Avenue, San Jose, California, commonly known as Building 1, consisting of 162,557 rentable square feet of space, as more particularly described in the Lease (the "Premises"), and situated within that certain commercial development commonly known as "Coleman Highline" (the "Project"). Capitalized terms used and not otherwise defined herein shall have the meanings set forth for them in the Lease.

B.Assignee currently leases space within the Project pursuant to that certain (a) Office Lease, dated August 1, 2018, by and between Landlord, as landlord, and Assignee, as tenant, as amended by that certain Coleman Highline First Amendment to Office Lease, dated November 6, 2018 (collectively, the "Building 2 Lease"), for the lease of that certain six (6) story building located at 1155 Coleman Avenue, San Jose, California ("Building 2"), as more particularly described in the Building 2 Lease, and (b) Office Lease, dated August 1, 2018, by and between CAP OZ 34, LLC, a Delaware limited liability company ("CAP OZ"), an affiliate of Landlord, as landlord, and Assignee, as tenant, as amended by that certain First Amendment to Office Lease, dated November 14, 2018 (collectively, the "Buildings 3, 4 and A2 Lease"), for the lease of that certain (i) six (6) story building located (or to be located) at 1173 Coleman Avenue, San Jose, California ("Building 3"), (ii) five (5) story building located (or to be located) at 1167 Coleman Avenue, San Jose, California ("Building 4"), and (iii) three (3) story amenities building located (or to be located) at 1161 Coleman Avenue, San Jose, California ("Building A2"), as more particularly described in the Buildings 3, 4, and A2 Lease.

C.Assignor desires to assign all of its right, title and interest in the Lease to Assignee, and Assignee desires to accept such assignment and assume the obligations of Tenant under the Lease, effective as of the Assignment Date (as hereinafter defined) and subject to the terms and conditions of this Agreement. Assignor and Assignee further desire that Landlord consent to such assignment, and Landlord has agreed to consent to such assignment, subject to the terms and conditions hereinafter set forth.

D.Landlord, Assignor and Assignee now desire to enter into this Agreement.

A G R E E M E N T

NOW, THEREFORE, in consideration of the foregoing Recitals (which are hereby incorporated herein by this reference), the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

Defined Terms.

As used in this Agreement, the following capitalized terms have the following meanings:

1.1."Assignment Date" means the Effective Date.

1.2."Delivery Condition" means clear of all personal property of Assignor, broom clean, free of debris and otherwise in the "AS IS" "WHERE IS" existing condition as of the date of this Assignment with no representations or warranties whatsoever by Assignor as to the physical, legal or any other condition of the Premises except as may be expressly set forth herein.

1.3."Assignor Obligations" means, collectively, (a) the obligation of Assignor to pay to Landlord the Base Rent payable under the Lease for the period from the Assignment Date through December 31, 2020, as more particularly described in Section 3.1 of this Agreement below, (b) the obligation of Assignor to pay Tenant's Share of Direct Expenses to Landlord for the period from the Assignment Date through December 31, 2020, at the times and in the manner Base Rent and Tenant's Share of Direct Expenses are required to be paid pursuant to the terms of the Lease, subject to reimbursement by Assignee of such Base Rent and Tenant's Share of Direct Expenses as described in Section 3.1 below.

1.4."Release Date" means January 1, 2022, subject to Section 4 below.

All initial capitalized but undefined terms used herein shall have the same meaning as ascribed to such terms in the Lease, as hereby amended.

Assignment of Lease and Assumption of Obligations; Landlord's Consent.

2.1.Assignment and Assumption. Assignor hereby grants, conveys and assigns to Assignee, effective as of the Assignment Date, all of Assignor's right, title and interest in and to the Lease, and Assignee hereby accepts such assignment and assumes from Assignor, all obligations and liabilities of the "Tenant" under the Lease that accrue following the Assignment Date; provided, however, that, as between Assignor and Assignee, the foregoing shall not be deemed or construed as relieving Assignor of its obligation to perform the Assignor Obligations as required by this Agreement. Such assignment and assumption is made upon, and is subject to, all of the terms, conditions and provisions of this Agreement. Assignor hereby assigns to Assignee, and Assignee hereby accepts such assignment. From and after the Assignment Date, all references in the Lease to "Tenant" shall be deemed to refer to Assignee. Notwithstanding such assignment, but subject to Section 3.1 below, prior to the Release Date, Assignor shall remain jointly and severally liable with Assignee under the Lease (as amended hereby) for the payment of rents and the performance of all obligations notwithstanding the assignment of the interest of "Tenant" thereunder to Assignee as contemplated hereby; provided, however, Assignor is not liable for the

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Base Rent Increase (as that term is defined in Section 14.4 below). In the event of any default of Assignee under the Lease prior to or on the Release Date, but subject to Section 3.1 below, Landlord may proceed directly against Assignee, Assignor, any guarantors or anyone else liable under the Lease without first exhausting Landlord's remedies against any other person or entity liable thereon to Landlord. Notwithstanding the foregoing, any act or omission of Assignor or Assignee or anyone claiming under or through Assignor or Assignee that violates any of the provisions of the Lease prior to the Release Date shall be deemed a violation of the Lease by Assignor or Assignee, respectively.

2.2Landlord's Consent. Subject to the terms and conditions of this Agreement, Landlord (i) consents to the assignment and assumption of the interest of Tenant under the Lease, as contemplated by this Agreement and (ii) waives its rights to recapture the Premises with respect to the assignment set forth in this Agreement. Such consent and this Agreement shall not be construed to: (a) modify, waive, release or otherwise affect any of the terms, covenants, conditions, provisions or agreements of the Lease, except as expressly set forth in this Agreement; (b) waive any rights of Landlord under the Lease, including Landlord's recapture rights, except as expressly set forth in this Agreement; (c) enlarge or increase the obligations of Landlord under the Lease, except as expressly set forth in this Agreement, if at all; (d) enlarge or increase Assignee's rights and benefits in excess of the rights and benefits applicable to the "Tenant" under the Lease, except as expressly set forth in this Agreement; or (e) be a consent by Landlord to any further assignment, sublease, pledge or other transfer of the Lease, the Premises or any portion thereof, or any rights or interests therein, by Assignee (all to the extent Landlord's consent thereto is required pursuant to the terms of the Lease, as amended hereby). Notwithstanding the foregoing, Landlord may consent to subsequent sublettings and assignments of the Lease without notifying Assignor or anyone else liable under the Lease and without obtaining their consent and such action shall not relieve such persons from liability, but shall not under any circumstances increase the obligations or liabilities of Assignor under the Lease.

2.2.No Assignor Liability for Certain Lease Obligations. Notwithstanding anything to the contrary in this Agreement, Landlord. Assignee and Assignor agree that, other than those obligations of Assignor expressly provided in this Agreement that arise prior to the Release Date, Assignor shall not be liable nor responsible for any obligations under the Lease above and beyond those set forth in the Lease as of the Effective Date, including, without limitation, the Base Rent Increase.

Assumption of Certain Obligations.

3.1.Assignor Payment Period. During the period from the Assignment Date and continuing through and including December 31, 2020 (the "Assignor Payment Period"), as between Assignor and Assignee, Assignor shall be solely responsible for the Assignor Obligations, and Assignee shall be responsible for the performance of all other obligations under the Lease that arise or accrue with respect to such period, including the cost of utility services, janitorial services and similar services consumed at or supplied to the Premises, and Assignee shall pay the same directly to the applicable utility or service provider. During the Assignor Payment Period, Assignor shall have the benefit of any accelerated free or abated Base Rent under the Lease. During the Assignor Payment Period only, Assignor shall be primarily liable for the performance of the Assignor Obligations, and, in the event of a default by Assignor in the performance of the Assignor

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Obligations, Landlord shall first proceed directly against Assignor in seeking to enforce Landlord's remedies under the Lease with respect to the performance of such Assignor Obligations, including applying the proceeds of the "Assignor L-C" (as that term is defined in Section 9.1 below), prior to proceeding against Assignee in seeking to enforce Landlord's remedies under the Lease. Subject to this Section 3.1 above, Landlord shall accept such payments of Base Rent and Tenant's Share of Direct Expenses by Assignor in satisfaction of the obligation of the "Tenant" under the Lease to pay Base Rent and Tenant's Share of Direct Expenses.

3.2.Reimbursement by Assignee. Following the expiration of the Assignor Payment Period, within ten (10) days following receipt of reasonable supporting documentation, Assignee shall reimburse Assignor for (i) the full amount of Base Rent (without interest) actually paid by Assignor to Landlord (estimated to be $4,750,000) pursuant to Section 3.1 above and attributable to the period from April 1, 2020 through December 31, 2020, which reimbursed amount shall be reduced by $461,496 to offset the portion of the Tenant Improvement Allowance (as that term is defined in the Tenant Work Letter attached to the Lease as Exhibit B) that has been disbursed by Landlord to Assignor prior to the Assignment Date, and (ii) Tenant's Share of Direct Expenses (without interest) actually paid by Assignor to Landlord (estimated to be $2,200,000) pursuant to Section 3.1 above and attributable to the period from November 1, 2019 through December 31, 2020.

3.3.Remainder of Lease Term. During the period from January 1, 2021 and continuing thereafter throughout the remainder of the Lease Term, as between Assignor and Assignee, Assignee shall be solely responsible for the performance of all obligations that arise or accrue under the Lease with respect to such period, including, without limitation, the payment of the Base Rent Increase. Following the Release Date and continuing thereafter throughout the remainder of the Lease Term, Assignor shall be released in accordance with Section 4 below, and Assignee shall remain solely responsible for the performance of all obligations that arise or accrue under the Lease with respect to such period.

Release.

4.1.In General. Notwithstanding this Agreement or Landlord's consent under Section 2.2 above or any provision to the contrary contained in the Lease or this Agreement, as between Landlord and Assignor, except with respect to Assignor's performance of its obligations set forth in the Lease that arise or accrue prior to the Release Date and are intended to survive the termination of the Lease, including, without limitation, Assignor's indemnity obligations related to Assignor's actions that arose or accrued prior to the Release Date, and except as provided in Sections 3.1, 4, and 9 hereof, and conditioned upon the satisfaction of all of the Release Conditions as of the Release Date:

(a)As between Landlord and Assignor, Landlord and Assignor shall, as of the Release Date, be fully and unconditionally released and discharged from their respective obligations arising on and after the Release Date from or connected with the provisions of the Lease, specifically including, without limitation, (i) any right Assignor may have to audit or review Landlord's books or records or to contest any "Direct Expenses" as that term is defined in the Lease, billed to Assignor under the Lease, and (ii) any restoration and removal requirements set forth in the Lease, and Assignee hereby acknowledges the release and discharge of Assignor pursuant to this Section 4.1(a); and

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(b)As between Landlord and Assignor, this Agreement shall fully and finally settle all demands, charges, claims, accounts or causes of action of any nature, including, without limitation, both known and unknown claims and causes of action that may arise out of or in connection with the obligations of Landlord and Assignor under the Lease on and after the Release Date.

Each of Landlord and Assignor expressly waive the provisions of California Civil Code

Section 1542, which provides:

"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY."

Each of Landlord and Assignor acknowledges that it has received the advice of legal counsel with respect to the aforementioned waiver and understands the terms thereof.

4.2.Limitation on Release. Notwithstanding anything to the contrary set forth in this Section 4, above, in no event shall anything set forth in this Section 4 constitute a release or discharge of Assignor from Assignor's obligation for the payment of rents and for the performance of all other obligations of Assignor under the Lease to the extent attributable to the period ending at 11:59 p.m. of the day immediately preceding the Release Date including, without limitation, the payment of reconciliation of Tenant's Share of Direct Expenses (provided that Landlord shall be obligated to provide a "Statement" for the applicable "Expense Year", as those terms are defined in Section 4.4.1 of the Lease, pursuant to the terms of the Lease in connection with such reconciliation), and any liability arising on or before the Release Date related to Assignee or Assignor's use, occupancy or control of the Premises during the term of the Lease prior to the Release Date, and Landlord shall have all the rights and remedies with respect to such obligations as set forth in the Lease; provided, however, in connection with any claims for which Assignee is liable pursuant to the terms of this Agreement, for the period commencing on January 1, 2021 to and until the Release Date, Landlord agrees to seek recourse and exhaust remedies first against Assignee before proceeding against Assignor.

4.3.Release Conditions. "Release Conditions" shall mean: (i) Landlord's receipt from Assignor, on or before the Release Date, of an amount equal to $800,000, which amount is being paid to Landlord in consideration for the agreement to release Assignor from liability, (ii) performance by Assignor and Assignee of all obligations under the Lease (as hereby amended) arising or accruing prior to the Release Date, (iii) there has been no "Material Reduction in Assignee’s Revenues" (defined below), (iv) neither Assignor or Assignee has filed a voluntary petition under the Bankruptcy Code, (v) an involuntary petition has not been filed against Assignor or Assignee under the Bankruptcy Code, (vi) the Lease has not been rejected or deemed rejected, under Section 365 of the U.S. Bankruptcy Code, following the filing of a voluntary petition by Assignor or Assignee under the Bankruptcy Code, or the filing of an involuntary petition against Assignor or Assignee under the Bankruptcy Code, (vii) Assignee has completed construction of the Tenant Improvements (though the requirement in this subsection (vii) shall be deemed automatically deleted and of no further force or effect if Assignee and Landlord further extend the outside date for use of the Tenant Improvement Allowance beyond the date set forth in Section

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10.1 below), and (viii) the "Assignee L-C" has been transferred to Landlord as "Beneficiary" or a new Assignee L-C has been issued to Landlord as "Beneficiary" pursuant to Section 9.2 below. If the Release Conditions are not satisfied as of January 1, 2022, then Assignee shall not be released from liability under the Lease, as amended, and the "Release Date" shall not occur, unless and until all of the Release Conditions have been satisfied. The phrase "Material Reduction in Assignee's Revenues" as used in subsection (iii) above shall mean Assignee's total net revenue on a trailing twelve (12) month basis as of June 30, 2021, is less than fifty percent (50%) of Assignee's total net revenue on a trailing twelve (12) month basis as of June 30, 2019.

Delivery of Premises.

5.1.On the Assignment Date, Assignor shall deliver the Premises to Assignee in the Delivery Condition; provided that, during the Assignor Payment Period, Assignee shall have only supervised access to the Premises. To the extent that Assignee desires to have supervised access during the Assignor Payment Period, Assignee shall first (i) provide to Assignor certificates of insurance evidencing that Assignee has obtained the property and liability insurance required of the "Tenant" under the Lease, naming Assignor as additional insured, (ii) have provided to Assignor the Assignee L-C, and (iii) not be in default in any of its obligations under this Agreement beyond any applicable notice and cure period. Commencing on January 1, 2021 and continuing for the remainder of the Lease Term, Assignee shall have exclusive possession of the Premises.

5.2.On or prior to the Assignment Date, Assignee and Assignor agree and acknowledge that Assignee has had access to the Premises to allow Assignee to undertake its own due diligence, at its own cost and expense, relative to the physical, legal and environmental condition of the Premises, and Assignee has completed such investigations to its own satisfaction.

Certifications and Estoppel.

6.1.Assignor hereby certifies to Assignee and Landlord, as of the Assignment Date, that:

(a)The Lease has not been supplemented, amended or modified.

(b)The copy of the Lease provided to Assignee by Assignor via electronic mail on April 26, 2019 sent by James M. Rishwain, Jr. is a true and complete

copy of the Lease.

(c)The Lease is in full force and effect, Assignor's rights and interests under the Lease are free of any liens, charges and encumbrances created by Assignor, and Assignor has not heretofore assigned, sublet or otherwise transferred its interest in the Lease.

(d)To Assignor's actual knowledge, Assignor has fully performed all covenants and obligations under the Lease and has not done or permitted any acts in violation of the covenants contained in the Lease.

(e)To Assignor's actual knowledge, Landlord (A) has fully performed all the covenants and obligations on its part to be performed and observed under the Lease and (B) Landlord has not done or permitted any act or acts in violation of any of the covenants, provisions or terms of the Lease.

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Assignor acknowledges that Landlord and Assignee will be relying on the certifications made in this Section 6.1 in agreeing to the assignment contemplated in this Agreement. In no event shall the certifications made by Assignor in this Section 6.1 subject Assignor to any liability whatsoever (other than to create an estoppel, subject to the conditions herein), despite the negligent or otherwise inadvertent failure of Assignor to disclose correct or relevant information.

6.2.Landlord hereby certifies to Assignor and Assignee, as of the Assignment Date, that:

(a)The Lease has not been supplemented, amended or modified.

(b)The copy of the Lease provided to Assignee by Assignor via electronic mail on April 26, 2019 sent by James M. Rishwain, Jr. is a true and complete copy of the Lease.

(c)The Lease is in full force and effect.

(d)To Landlord's actual knowledge, all conditions of the Lease to be performed by Landlord necessary to the enforceability of the Lease have been satisfied and Landlord is not in default thereunder.

(e)To Landlord's actual knowledge, all conditions of the Lease to be performed by Assignor necessary to the enforceability of the Lease have been satisfied and Assignor is not in default thereunder.

(f)To Landlord's actual knowledge, there are no existing defenses or offsets, or, to Landlord's knowledge, claims or any basis for a claim, that Assignor has against Landlord, or Landlord has against Assignor.

Landlord acknowledges that Assignee will be relying on the certifications made in this Section 6.2 in agreeing to the assignment contemplated in this Agreement. In no event shall the certifications made by Landlord in this Section 6.2 subject Landlord to any liability whatsoever (other than to create an estoppel, subject to the conditions herein), despite the negligent or otherwise inadvertent failure of Landlord to disclose correct or relevant information.

6.3.Following the execution of this Assignment by Assignor and Assignee, Assignor shall not, without the prior written consent of Assignee (which consent may be granted or withheld in Assignee's sole and absolute discretion), take any action, or omit to take any action, which will render any representation or warranty set forth herein inaccurate, and shall notify Assignee in writing, within three (3) business days of Assignor's learning thereof from time to time, of any fact or circumstance that renders any such representation or warranty inaccurate. Without limiting the generality of the foregoing, Assignor shall not, without Assignee's prior written consent (which consent may be granted or withheld in Assignee's sole and absolute discretion), supplement, amend or otherwise modify the Lease or enter into any agreement or contract which affects the Premises.

6.4.Assignee acknowledges that, except for the representations and warranties expressly set forth in this Section 6, Assignor and Landlord have made no representations or warranties, express or implied, with respect to the Lease or the Premises and Assignee accepts the Lease and the Premises in its AS IS WHERE AS existing condition relying entirely on its own due diligence.

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Assignor's Right to Perform.

Assignee acknowledges and agrees that Assignor is not released from liability under the Lease notwithstanding this Assignment, subject to Section 4 above, until the Release Date. All covenants and agreements to be performed by Assignee under the Lease shall be performed at Assignee's sole cost and expense and without any abatement of rent or right of set-off, except as otherwise expressly set forth in the Lease. Prior to the Release Date, if Assignee fails to pay any sum of money, other than rent payable to Landlord during the Assignor Payment Period, or fails to perform any other act on its part to be performed under the Lease, and the failure continues beyond any applicable notice and grace period set forth in the Lease, then, in addition to any other available remedies, Assignor may, upon three (3) days' prior written notice to Assignee, at its election make the payment or perform the other act on Assignee's part and Assignee hereby grants Assignor the right to enter onto the Premises in order to carry out such performance subject to and in compliance with the provisions of the Lease. Assignor's election to make the payment or perform the act on Assignee's part shall not give rise to any responsibility of Assignor to continue making the same or similar payments or performing the same or similar acts nor shall Assignor be responsible to Assignee for any damage caused to Assignee as the result of such performance by Assignor. Assignee shall, promptly upon demand by Assignor, reimburse Assignor for all sums paid by Assignor and all necessary incidental costs, together with interest at the per annum rate of 10% not to exceed the maximum rate permitted by law from the date of the payment by Assignor.

Indemnification.

8.1.Subject to Section 4 above, recognizing that Assignor is not released from liability under the Lease until the Release Date, Assignee hereby agrees to indemnify, protect, defend and hold Assignor harmless for, from and against any and all claims, damages, losses, liabilities, demands, costs and expenses (including, but not limited to, reasonable attorneys' fees) arising from (a) any actual failure of Assignee to perform any of its duties or obligations under the Lease or this Agreement accruing from and after the Assignment Date, except to the extent such failure results or arises from the failure of Assignor to perform the Assignor Obligations or any of Assignor's express obligations set forth in this Agreement, (b) any actual claims by third parties occasioned by (1) any injuries to any person or damage to, or theft or loss of, property occurring in or about the Premises from and after the Assignment Date, or (2) any actual breach by Assignee of the obligations of "Tenant" under the Lease accruing from and after the Assignment Date, and (c) any increased liabilities, obligations or responsibilities over and above the obligations existing under the Lease as of the Effective Date that are created by Landlord and Assignee under the Lease, except to the extent such failure results or arises from the failure of Assignor to perform the Assignor Obligations or any of Assignor's express obligations set forth in this Agreement. In case any action or proceeding is brought against Assignor and such claim is a claim from which Assignee is obligated to indemnify Assignor pursuant to this Section 8.1, Assignee, upon notice from Assignor, shall resist and defend such action or proceeding (by counsel reasonably satisfactory to Assignor) at Assignee's expense.

8.2.Assignor hereby agrees to indemnify, protect, defend and hold Assignee harmless for, from and against any and all claims, damages, losses, liability, demands, costs and expenses (including, but not limited to, reasonable attorneys' fees) arising from (a) any actual failure of Assignor to perform any of its duties or obligations under the Lease accruing prior to the

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Assignment Date, (b) any actual failure of Assignor to perform the Assignor Obligations or any of Assignor's express obligations set forth in this Agreement, (c) any breach of the representations and warranties set forth in Section 6.1 of this Agreement above or Section 10 below, (d) any actual claims by third parties occasioned by (1) any injuries to any person or damage to, or theft or loss of, property occurring in or about the Premises prior to the Assignment Date, except to the extent resulting from the acts or omissions of Assignee or its agents, employees or contractors, or (2) any actual breach by Assignee of the obligations of "Tenant" under the Lease accruing prior to the Assignment Date. In case any action or proceeding is brought against Assignee and such claim is a claim from which Assignor is obligated to indemnify Assignee pursuant to this Section 8.2, Assignor, upon notice from Assignee, shall resist and defend such action or proceeding (by counsel reasonably satisfactory to Assignee) at Assignor's expense.

Letters of Credit.

9.1.Assignor's Letter of Credit. The parties (including Landlord) agree that Article 21 of the Lease governs the securitization required by the Lease and the parties (including Landlord) acknowledge and agree that Assignor has provided a letter of credit meeting the requirements of said Article 21 to Landlord as a security deposit under the Lease (the "Assignor L-C"). Notwithstanding the assignment of the interest of "Tenant" under the Lease to Assignee as contemplated by this Agreement, from and after the Assignment Date and continuing through the date that is ten (10) days following the Release Date, (i) Assignor shall continue to maintain the Assignor L-C meeting the requirements of said Article 21 of the Lease, and shall continue to be bound by all of the terms of said Article 21 of the Lease, and (ii) Landlord shall continue to have the right to draw on the Assignor L-C as and when permitted pursuant to said Article 21 of the Lease. Landlord agrees that upon the date which is on or before the date which is one hundred (100) days following the Release Date, Landlord shall return the original Assignor L-C to Assignor and thereafter shall rely on the Assignee L-C as the securitization for the Lease as required by Section 21 of the Lease. Notwithstanding the terms of the Lease, the "First Reduction Date" shall be one hundred (100) days after the later of (a) the date the Assignee L-C has been transferred to Landlord as "Beneficiary" pursuant to Section 9.2 below and (b) January 1, 2021. In addition, "First L-C Reduction Condition" shall mean the satisfaction of all of the following: (1) performance by Assignor and Assignee of all obligations under the Lease (as hereby amended) arising or accruing prior to the First Reduction Date, (2) there has been no material adverse change in Assignor's financial condition since the Assignment Date, (3) Assignee not having received written notice of a monetary or material non-monetary default under the Lease, which then remains uncured, (4) neither Assignor or Assignee has filed a voluntary petition under the Bankruptcy Code, (5) an involuntary petition has not been filed against Assignor or Assignee under the Bankruptcy Code, and (6) the Lease has not been rejected or deemed rejected, under Section 365 of the U.S. Bankruptcy Code, following the filing of a voluntary petition by Assignor or Assignee under the Bankruptcy Code, or the filing of an involuntary petition against Assignor or Assignee under the Bankruptcy Code. Notwithstanding the foregoing, as of the date that is one hundred (100) days following the Release Date, Landlord and Assignor shall take those actions required to cancel the Assignor L-C (or any portion thereof remaining after any draw by Landlord pursuant to the terms of the Assignor L-C) effective as of the Release Date.

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9.2.Assignee's Letter of Credit.

(a)Delivery of Letter of Credit. Assignee shall cause Morgan Stanley Bank, N.A. (which Landlord and Assignor each hereby approves as a "Bank" under Section 21.1 of the Lease) to deliver to Assignor, within ten (10) days of the Effective Date of this Agreement, a letter of credit (the "Assignee L-C") that complies in all respects with the requirements of Article 21 of the Lease, in the form of Exhibit A attached hereto, except that the "L-C Amount" shall be equal to Four Million Fifty Thousand and 00/100 Dollars ($4,050,000.00), (ii) Assignor shall be the initial Beneficiary under the Assignee L-C, (iii) the Assignee L-C Amount shall not be reduced on the First Reduction Date, and (iv) Assignor shall have the right to draw down an amount up to the face amount of the Assignee L-C on a dollar-for-dollar basis to the same extent that Landlord has drawn on the Assignor L-C as a result of Assignee’s failure to perform its obligations required under this Agreement or the Lease. The parties acknowledge and agree that the Assignee L-C shall be held by Assignor as security for the repayment of the amounts paid by Assignor as part of the Assignor Obligations.

(b)Transfer or Replacement of Letter of Credit to Landlord. On or before January 1, 2021, Assignor shall take all actions required to cause the Assignee L-C to be transferred to Landlord as "Beneficiary" (in which case Assignor shall immediately deliver the original Assignee L-C to Landlord) or (2) a new Assignee L-C to be issued to Landlord as "Beneficiary" (in which case Assignor shall immediately deliver the original Assignee L-C to Assignee), and from and after the date of such transfer, Landlord shall be the "Beneficiary" under such Assignee L-C, and the terms of Article 21 of the Lease shall apply with respect to the Assignee L-C. Without limiting the foregoing, but subject to Section 9.2(a) above, the terms of Section 21.9 of the Lease shall apply with respect to the Assignee L-C, except that as of the Assignment Date, the defined term "Second L-C Reduction Condition" shall be amended to mean the following: "that Assignee has not received written notice of a monetary or material non-monetary default under the Lease, which then remains uncured and Assignee is then occupying the Premises for the conduct of its business, and that Assignee has been "cash flow positive," on a trailing twelve (12) month "Adjusted EBITDA" (i.e., after excluding from Net Income or Loss (i) other income (expense), net, (ii) stock-based compensation expense, (iii) depreciation and amortization, and (iv) income tax expense where applicable) basis during the twelve (12) month period ending on the last day of Assignee's most recently completed fiscal quarter ending prior to the measurement date." The parties acknowledge and agree that, after the date of transfer of the Assignee L-C to Landlord as "Beneficiary" or the issuance of a new Assignee L-C to Landlord as "Beneficiary" as described above and the return of the Assignor L-C to Assignor, the Assignee L-C shall be held by Landlord as the sole security for the faithful performance by Assignee of all of the terms and conditions of the Lease and all of the obligations of Tenant under the Lease and the Assignor L-C shall be immediately released by Landlord and delivered to Assignor.

(c)Drawing on Assignee L-C. Assignee agrees that Assignor shall have the right to draw down an amount up to the face amount of the Assignee L C on a dollar-for-dollar basis to the same extent that Landlord has drawn on the Assignor L-C as a result of Assignee's failure to perform its obligations required under this Agreement or the Lease.

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10.

Tenant Improvements.

10.1.Tenant Improvement Allowance. Effective as of the Assignment Date, notwithstanding any provision to the contrary set forth in the Lease: (i) the Tenant Improvement Allowance (as that term is defined in the Tenant Work Letter attached to the Lease as Exhibit B) is reduced to a total of $15,314,604.03, (ii) the final sentence of Section 2.1 of Exhibit B attached to the Lease is hereby deleted in its entirety, and (iii) the phrase "within six months following the Lease Commencement Date" in the final sentence of Section 2.2.2.3 of Exhibit B attached to the Lease is hereby deleted and replaced with the phrase "by July 1, 2021".

10.2.Existing Plans, Permits and Fees. Assignee shall have the right to and benefit of Assignor's existing plans, permits and any fees that have been paid to the City of San Jose to the extent any or all of the foregoing are transferable. To the extent Assignee desires to have an assignment of existing plans, permits and other paid fees, Assignee shall provide written notice to Assignor and Assignor hereby agrees that upon such written notice, Assignor shall reasonably cooperate with Assignee in connection with such assignment and to use commercially reasonable efforts to obtain any third party consents that may be required, all at Assignee's sole cost and expense.

11.

Renewal Option.

Pursuant to the terms of the Lease, the option to extend the Lease Term as set forth in Article 2 of the Lease is personal to Assignor and is not transferable to Assignee. Notwithstanding the terms of the Lease, Assignee and its Permitted Transferee Assignees shall have the benefit of such option to extend.

12.

Right of First Offer.

The right of first offer in Section 1.2 of the Lease is personal to Assignor and is not transferable to Assignee and, accordingly, is hereby deleted from the Lease.

13.

Signage.

Pursuant to the terms of the Lease, certain signage rights are personal to Assignor and are not transferable to Assignee. Notwithstanding the terms of the Lease, Assignee and its Permitted Transferee Assignees shall have the benefit of all signage rights granted to Assignor pursuant to the Lease. Within thirty (30) days following the Effective Date, Assignor, at Assignor's sole cost, shall remove any signage at the Project that depicts Assignor's name and/or logo, and repair any damage caused by such removal.

14.Other Amendments to Lease. The Lease shall be amended as follows, on the applicable effective date set forth below, with the understanding that none of the agreements contained in this Section 14 will increase or expand the obligations, responsibilities or liabilities of Assignor under the Lease or this Agreement.

14.1.Management Fee. Effective as of January 1, 2021, any management fee shall be excluded from Operating Expenses, to the extent such fee for the management of the Project exceeds two percent (2%) of the sum of Tenant's annual Base Rent obligations fully

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grossed up and adjusted to reflect a one hundred percent (100%) occupancy of the Project with all tenants paying full rent, as contrasted with free rent, half-rent and the like (the "Management Fee Cap") (though the amount of any management fee that does not exceed the Management Fee Cap shall be included in Operating Expenses).

14.2.Appealable Tax Expenses. Effective as of January 1, 2021, so long as Tenant is leasing the entire initial Premises, Tenant may request from Landlord whether or not Landlord intends to file an appeal of any portion of Tax Expenses which are appealable by Landlord (the "Appealable Tax Expenses") for any tax fiscal year. Landlord shall deliver written notice to Tenant within ten (10) days after such request indicating whether Landlord intends to file an appeal of Appealable Tax Expenses for such tax fiscal year. If Landlord indicates that Landlord will not file an appeal of such Tax Expenses, then Tenant may provide Landlord with written notice ("Appeals Notice") at least thirty (30) days prior to the final date in which an appeal must be filed, requesting that Landlord file an appeal. Upon receipt of the Appeals Notice, but subject to the terms and conditions of this Section 14.2 below, Landlord shall promptly file such appeal and thereafter Landlord shall diligently prosecute such appeal to completion. Tenant may at any time in its sole discretion direct Landlord to terminate an appeal it previously elected pursuant to an Appeals Notice. In the event Tenant provides an Appeals Notice to Landlord and the resulting appeal reduces the Tax Expenses for the tax fiscal year in question as compared to the original bill received for such tax fiscal year and such reduction is greater than the costs for such appeal, then the costs for such appeal shall be included in Tax Expenses and passed through to the tenants of the Building when funds are actually received. Alternatively, if the appeal does not result in a reduction of Tax Expenses for such tax fiscal year or if the reduction of Tax Expenses is less than the costs of the appeal, then Tenant shall reimburse Landlord, within thirty (30) days after written demand, for any and all costs reasonably incurred by Landlord which are not covered by the reduction in connection with such appeal. Tenant's failure to timely deliver an Appeals Notice shall waive Tenant's rights to request an appeal of the applicable Tax Expenses for such tax fiscal year. In addition, Tenant's obligations to reimburse Landlord for the costs of the appeal pursuant to this Section shall survive the expiration or earlier termination of the Lease, as amended, in the event the appeal is not concluded until after the expiration or earlier termination of the Lease, as amended. Upon request, Landlord agrees to keep Tenant apprised of all tax protest filings and proceedings undertaken by Landlord to obtain a reduction or refund of Tax Expenses.

14.3.Prohibited Uses. As of the Assignment Date, the phrase "; or (vi) communications firms such as radio and/or television stations" in the first sentence of Section 5.2 of the Lease is hereby deleted.

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14.4.Base Rent. Commencing as of January 1, 2021, Tenant shall pay Base Rent in the amounts set forth below, and otherwise in accordance with the terms of the Lease. The difference between the amounts set forth below and the amounts originally set forth in the Lease for the corresponding time periods is the "Base Rent Increase".


Period During_ Lease Term	Annual Base Rent	Monthly Installment of Base Rent	Monthly Base Rent per RSF

January 1, 2021 –
December 31, 2021	$7,450,130.40	$620,844.20	$3.82

January 1, 2022 –
December 31, 2022	$7,673,634.36	$639,469.53	$3.93

January 1, 2023 –
December 31, 2023	$7,903,843.44	$658,653.62	$4.05

January 1, 2024 –
December 31, 2024	$8,140,958.76	$678,413.23	$4.17

January 1, 2025 –
December 31, 2025	$8,385,187.56	$698,765.63	$4.30

January 1, 2026 –
December 31, 2026	$8,636,743.20	$719,728.60	$4.43

January 1, 2027 –
December 31, 2027	$8,895,845.52	$741,320.46	$4.56

January 1, 2028 –
December 31, 2028	$9,162,720.84	$763,560.07	$4.70

January 1, 2029 –
December 31, 2029	$9,437,602.44	$786,466.87	$4.84

14.5.Shuttle Service. Subject to the provisions of this Section 14.5, Landlord shall provide and continuously operate (or cause a third party to operate) throughout the Lease Term a shuttle service (the "Shuttle Service") at the Project providing services to the nearest CalTrain station to Tenant's employees ("Shuttle Service Riders"). Tenant shall have the right to consult with Landlord on the number and size of shuttles, frequency, hours of use, routes and location of the drop-off and pick-up areas for the Shuttle Service, and Landlord shall implement any reasonable recommendations of Tenant. The use of the Shuttle Service shall be subject to the reasonable rules and regulations established from time to time by Landlord and/or the operator of the Shuttle Service. Landlord and Tenant acknowledge that the use of the Shuttle Service by the Shuttle Service Riders shall be at their own risk and that the terms and provisions of Section 10.1

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of the Lease shall apply to Tenant and the Shuttle Service Rider's use of the Shuttle Service. The costs of operating, maintaining and repairing the Shuttle Service shall be included as part of Operating Expenses and no separate fees will be charged to the users of the Shuttle Service.

14.6.Rooftop and Riser Rights. The following is hereby added to the Lease as a new Article 22, which Article 22 shall be entitled "Rooftop and Riser Rights":

"22.1Telecommunications Equipment. At any time during the Lease Term, subject to the terms of this Lease, Tenant may, (i) install, at Tenant's sole cost and expense, two (2) communications dishes of up to 24" in diameter, or one (1) communications antenna or comparable communications equipment upon the roof of the Building not to exceed 48" in height, (ii) use the Building telecommunications rooms and risers to install (A) two (2) two inch (2") diameter ridged metal conduits from the Building MPOE to the Premises, and (B) one (1) two inch (2") conduit from the Premises to the roof for connection of Tenant's rooftop equipment to the Premises (all such equipment, installations and connections, collectively, the "Telecommunications Equipment"). The use of such areas of the Building for the installation of the Telecommunications Equipment shall be for the sole use of Tenant in connection with its business in the Premises, and shall be without the payment of any additional Base Rent or Direct Expenses with respect thereto. The physical appearance and all specifications of the Telecommunications Equipment shall be subject to Landlord's reasonable approval, the location of any such installation of the Telecommunications Equipment shall be designated by Landlord (subject to Tenant's reasonable approval), and Landlord may require Tenant to install screening around such Telecommunications Equipment, at Tenant's sole cost and expense, as reasonably designated by Landlord. Tenant shall be responsible, at Tenant's sole cost and expense, for (i) obtaining all permits or other governmental approvals required in connection with the Telecommunications Equipment (including, without limitation, approval by the Federal Aviation Administration), (ii) installing, repairing and maintaining and causing the Telecommunications Equipment to comply with all Applicable Laws, and (iii) prior to the expiration or earlier termination of this Lease, removal of the Telecommunications Equipment and all associated wiring, and the restoration of all affected areas of the Building to the condition existing prior to the installation thereof, including restoration of any roof penetrations. The Telecommunications Equipment shall constitute Specialty Improvements for purposes of Section 8.5 of this Lease.

22.2In no event shall Tenant permit the Telecommunications Equipment to interfere with the systems of any building in the Project or the Project or any other communications equipment at or servicing any building in the Project or the Project. Except to the extent arising from or out of the negligence or willful misconduct of any of the Landlord Parties, Tenant shall indemnify, defend, protect, and hold harmless the Landlord Parties from any and all loss, cost, damage, expense and liability (including, without limitation, court costs

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and reasonable attorneys' fees) incurred in connection with or arising from any cause related to Tenant's installation, use, repair or maintenance or any other matter relating to or in connection with the Telecommunications Equipment. In the event Tenant elects to exercise its right to install the Telecommunication Equipment, then Tenant shall give Landlord prior notice thereof. Landlord agrees that it shall not install, and shall prohibit the installation and/or operation by any other party of, any microwave dishes/earth satellite disks, whip antennae, other communications devices, towers and/or other structures on the roof of the Building which would interfere with Tenant's use of the Telecommunications Equipment."

14.7.Generator. The generator providing emergency power service to the Building systems, even if replaced by Tenant with a new, larger capacity generator, is part of the "Building Systems".

15.Commissions.

Assignor shall be responsible for broker commissions due and owing to Assignee's broker, Newmark Knight Frank and to Assignor's broker, JLL (collectively, the "Brokers"); provided, however, the commission to be paid to Newmark Knight Frank as Assignee's broker shall be in the amount of $1,981,163.44 (i.e., $1.25 per square foot per year for the remaining term of the Lease, and Assignor shall have no responsibility with respect to any other broker commissions due and owing in connection with this Assignment, including, without limitation, any amounts to Collier's International, a brokerage firm previously engaged by Assignee. Such commissions shall be due and payable on May 1, 2021. Assignor and Assignee each hereby agrees to protect, defend, indemnify and hold the other harmless from all claims, demands, causes of action, liabilities, losses, costs and expenses (including, without limitation, costs of suit and attorneys' fees) arising from or in connection with claims for broker commissions due and owing from or related to this Agreement, other than as described above to the Brokers.

16.Confidentiality.

Assignor, Assignee and Landlord agree that the terms and conditions contained in this Agreement will remain confidential between the parties to this Agreement, as well as to their financial and legal advisors and other retained professionals. Except as and to the extent required by law or court order, without the prior written consent of the other parties, each party shall not, and shall cause its advisors and retained professionals to not, directly or indirectly, make any public comment, statement or communication with respect to, or otherwise disclose or permit the disclosure of the existence of, a possible transaction between the parties or any of the terms, conditions or other aspects of the transaction proposed in this Agreement. Notwithstanding the foregoing, to the extent Landlord (or any Landlord Party), Assignor and/or Assignee is a publicly traded corporation, such party may be obligated to regularly provide financial information concerning Landlord, Assignor or Assignee and/or its respective affiliates to the shareholders of its affiliates, to the Federal Securities and Exchange Commission and other regulatory agencies, and to auditors and underwriters, which information may include, without limitation, summaries of financial information concerning leases, rents, costs and results of operations of its business, including any financial obligations set forth in the Lease or in this Agreement, and such required disclosures shall be permitted pursuant to the terms of this Section 16. This provision shall survive the Assignment Date.

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17.Subordination, Nondisturbance and Attornment.

Assignee and Assignor acknowledge and agree that Article 18 of the Lease provides parameters around the delivery of any SNDA from any lender relative to the Premises. Landlord agrees to endeavor to obtain an SNDA from Landlord's current lender. Assignee acknowledges that Assignor has no responsibility to deliver an SNDA to Assignee as Assignor has no privity of contract with Landlord's lender. Assignee acknowledges that Assignor has provided Assignee with a copy of the SNDA that has been delivered to Assignor in connection with the Lease. Such SNDA, if obtained, will be in the form and with content as required by the Lease and Landlord's lender. Assignee agrees that the delivery of an SNDA is not a condition to this Agreement.

18.Further Assurances.

Each party hereto shall execute, acknowledge and deliver to each other party hereto all documents, and shall take all actions, reasonably required by such other parties from time to time to confirm or effect the matters set forth herein, or otherwise to carry out the purposes of this Agreement.

19.Attorneys' Fees.

In the event that any litigation shall be commenced concerning this Agreement by any party hereto, the party prevailing in such matter shall be entitled to recover, in addition to such other relief as may be granted, its reasonable costs and expenses, including without limitation attorneys' fees and court costs, whether or not taxable, as awarded by a court of competent jurisdiction.

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20.Notices.

All notices, demands, approvals and other communications provided for in this Agreement shall be in writing and be delivered to the appropriate party at its address as follows:


If to Assignor:		8X8, INC., 2125 O'Nel Drive San Jose, CA 95131 Attention: Terry Pashoian

With a copy to:		Pillsbury Winthrop Shaw Pittman LLP 725 South Figueroa Street Suite 2800 Los Angeles, California 90017 Attention: James M. Rishwain, Jr.

If to Assignee:		Roku, Inc. 150 Winchester Circle Los Gatos, California 95032 Attn: Director of Real Estate

With a copy to:		Roku, Inc., 150 Winchester Circle Los Gatos, California 95032 Attn: General Counsel

If to Landlord:		CAP Phase 1, LLC c/o Hunter Properties Inc. 10121 Miller Avenue, Suite 200 Cupertino, California 95014-3469 Attention: Deke Hunter and Sherri Prieb

With a copy to:		Allen Matkins Leck Gamble Mallory & Natsis LLP 1901 Avenue of the Stars Suite 1800 Los Angeles, California 90067 Attention: Anton N. Natsis, Esq.

Addresses for notice may be changed from time to time by written notice to all other parties. All communications shall be effective when actually received; provided, however, that nonreceipt of any communication as the result of a change of address of which the sending party was not notified or as the result of a refusal to accept delivery shall be deemed receipt of such communication. From and after the Effective Date of this Agreement and prior to the Release Date, Landlord agrees that all notices to be delivered to the "Tenant" under the Lease shall be delivered concurrently to both Assignee and Assignor at the addresses therefor set forth above in this Section 20.

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21.No Third Parties Benefited.

This Agreement is made for the purpose of setting forth certain rights and obligations of Assignee, Assignor and Landlord, and no other person shall have any rights hereunder or by reason hereof as a third party beneficiary or otherwise.

22.Miscellaneous.

This Agreement shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto. This Agreement may be executed in counterparts with the same force and effect as if the parties had executed one instrument, and each such counterpart shall constitute an original hereof. Assignor, Assignee and Landlord agree that electronic signatures, including those delivered by PDF or signed through the electronic signature system known as "DocuSign", shall have the same effect as originals. All parties to this Agreement waive any and all rights to object to the enforceability of this Agreement based on the form or delivery of signature. No provision of this Agreement that is held to be inoperative, unenforceable or invalid shall affect the remaining provisions, and to this end all provisions hereof are hereby declared to be severable. Time is of the essence of this Agreement. This Agreement shall be governed by the laws of the State of California.

[SIGNATURES ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.


ASSIGNOR:

8X8, INC., a Delaware corporation

By:	/s/ Steve Gatoff
Name:	Steve Gatoff
Its:	Chief Financial Officer

ASSIGNEE:

Roku, Inc., a Delaware corporation

By:	/s/ Steve Louden
Name:	Steve Louden
Its:	Chief Financial Officer

LANDLORD:

CAP Phase 1, LLC, a Delaware limited liability company

By:		Coleman Airport Partners, LLC, a California limited liability company
Its:		Sole Member


By:	HS Airport, LLC, a California limited liability company
Its:	Manager
	By:	/s/ Derek K. Hunter, Jr.
	Name:	Derek K. Hunter, Jr.
	Its:	Member
	By:	/s/ Edward D. Storm
	Name:	Edward D. Storm
	Its:	Member

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EXHIBIT A

MORGAN STANLEY FORM OF LETTER OF CREDIT

Irrevocable Stand-by Letter of Credit

[Issue Date]

ISSUING BANK

Morgan Stanley Bank, N.A.

1300 Thames Street

Thames Street Wharf, 4^th Floor

Baltimore, MD 21231

Attention: Letter of Credit Department

Telephone: (443) 627-4555

Fax: (212) 507-5010

BENEFICIARY

8x8 Inc.

2125 O’Nel Drive

San Jose, CA 95131

Attention: Terry Pashoian

Date of Expiration: April 15, 2022, as such date may be extended pursuant to the terms hereof.

REF: IRREVOCABLE STANDBY LETTER OF CREDIT NO. (REF. NO. [ ])

This Irrevocable Standby Letter of Credit (the “Letter of Credit”) is hereby issued in favor of [8x8 INC,. a Delaware corporation, with business address of 2125 O’Nel Drive San Jose, California 95131 (hereinafter called “you” or the “Beneficiary”) for the account of ROKU, INC. with a business address of 150 Winchester Circle, Los Gatos, CA 95032 (hereinafter called the “Applicant”), for an amount not to exceed in the aggregated USD FOUR MILLION FIFTY THOUSAND AND NO/00 DOLLARS ($4,050,000.00) (the “Stated Amount”). This Letter of Credit is effective immediately and will expire on [one year from date of issuance], as such date may be extended pursuant to the terms hereof (the “Expiration Date”).

We hereby engage with you that demands for payment made by presentation of the following documents(s):

(a)Demand for payment of an amount available under this Letter of Credit in the form of Attachment A completed and signed by Beneficiary and

Exhibit 10.2

COLEMAN HIGHLINE

SECOND AMENDMENT TO OFFICE LEASE

THIS SECOND AMENDMENT TO OFFICE LEASE (this "Second Amendment") is made and entered into as of April 30, 2019 (the "Second Amendment Effective Date"), by and between CAP PHASE 1, LLC, a Delaware limited liability company ("Landlord"), and ROKU, INC., a Delaware corporation ("Tenant").

R E C I T A L S :

A.Reference is hereby made to that certain Office Lease dated as of August 1, 2018 between Landlord and Tenant (the "Original Lease"), as amended by that certain First Amendment to Office Lease dated as of November 6, 2018 (the "First Amendment" and, together with the Original Lease, collectively, the "Existing Lease").

B.Pursuant to the Existing Lease, Tenant leases from Landlord the entirety of that certain six (6)-story building located at 1155 Coleman Avenue, San Jose, California 95110, commonly known as Building Two (the "Premises"). The Premises is part of a mixed-use Project (as that term is defined in the Existing Lease) known as "Coleman Highline."

C.Tenant also currently leases within the Project (i) the entirety of that certain six (6)-story building located at 1173 Coleman Avenue, San Jose, California 95110, commonly known as Building Three ("Building 3"), (ii) the entirety of that certain five (5)-story building located at 1167 Coleman Avenue, San Jose, California 95110, commonly known as Building Four ("Building 4"), and (iii) the entirety of that certain three (3)-story amenities building located at 1161 Coleman Avenue, San Jose, California 95110, commonly known as the A2 Amenity Building ("Building A2"), pursuant to that certain Office Lease, dated August 1, 2018, by and between CAP OZ 34, LLC, a Delaware limited liability company ("CAP OZ"), an affiliate of Landlord, as landlord, and Tenant, as tenant, as amended by that certain First Amendment to Office Lease, dated as of November 14, 2018 (collectively, the "Buildings 3, 4 and A2 Lease"). Concurrently herewith, Tenant and CAP OZ are entering into an amendment to the Buildings 3, 4 and A2 Lease.

D.Additionally, concurrently herewith, Tenant is assuming from 8x8, Inc., a Delaware corporation ("8x8"), the tenant's interest in and to that certain Coleman Highline Office Lease, dated as of January 23, 2018, with Landlord, as landlord, for the lease of the entirety of that certain five (5)-story building located at 1143 Coleman Avenue, San Jose, California, commonly known as Building One ("Building 1") situated within the Project, pursuant to that certain Assignment and Assumption of Lease, Landlord's Consent and First Amendment of Lease dated of even date herewith. Building 1, Building 3, Building 4, and Building A2 are collectively referred to herein as the "Other Buildings."

COLEMAN HIGHLINE

1155 Coleman Avenue

Building 2

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Roku, Inc.

E.Landlord and Tenant now desire to amend the Existing Lease to, among other things, (i) extend the date by which Tenant must utilize the Tenant Improvement Allowance; (ii) approve the Highline Extension Plans and the Estimated Highline Extension Costs, which are attached hereto as Exhibit 1 and Exhibit 2, respectively; (iii) delete Tenant's Right of First Offer (as defined in the Existing Lease); (iv) grant Tenant exclusive use of the Amenities Building and the Shared Fitness Center for so long as Tenant occupies the Premises and Building 1, Building 3 and Building 4; and (v) modify various other terms and provisions of the Existing Lease, all as hereinafter provided.

NOW THEREFORE, in consideration of the foregoing recitals (which are hereby incorporated herein by this reference) and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.Capitalized Terms. All capitalized terms when used herein shall have the same meaning as is given such terms in the Existing Lease unless expressly superseded by the terms of this Second Amendment.

2.Tenant Improvement Allowance.

2.1.Lower Three Floors of Premises. The last sentence of Section 2.1 of Exhibit B of the Original Lease is deleted in its entirety and replaced with the following:

"Any unused portion of the Tenant Improvement Allowance remaining as of November 30, 2019, shall remain with Landlord, and Tenant shall have no further right thereto."

2.2.Top Three Floors of Premises. The last sentence of Section 2.1 of Exhibit 2 of the First Amendment is deleted in its entirety and replaced with the following:

"Any unused portion of the Tenant Improvement Allowance remaining as of November 30, 2019, shall remain with Landlord, and Tenant shall have no further right thereto."

3.Highline Extension. Notwithstanding anything to the contrary set forth in the Lease, Landlord agrees to construct the Highline Extension in accordance with the "Highline Extension Plans," as defined in Section 1.1.1 of Exhibit 2 to the First Amendment and which are described on Exhibit 1 attached hereto, provided that any interference with or delay of the construction of the Tenant Improvements caused by Landlord's construction of the Highline Extension shall be deemed not to be a "Landlord Caused Delay," as that term is defined in Section 5.1 of Exhibit 2 to the First Amendment. The Highline Extension shall be constructed in a good and workmanlike manner, and in compliance with Applicable Laws for unoccupied space as of the Second Amendment Effective Date to the extent required to allow Tenant, subject to Tenant's construction of the Tenant Improvements in accordance with Applicable Laws, to obtain a certificate of occupancy or its legal equivalent allowing the legal occupancy of the Premises for the Permitted Use. Furthermore, Tenant shall not be entitled to any deferred or abated Base Rent or any other damages for any delay to the construction of the Highline Extension for any reason. Landlord has selected DevCon as the "Highline Extension Contractor".

COLEMAN HIGHLINE

1155 Coleman Avenue

Building 2

-2-

Roku, Inc.

3.1.Determination of Estimated Highline Extension Costs. Landlord and Tenant hereby agreed to and approve the Highline Extension Plans and the "Estimated Highline Extension Costs," as defined in Section 1.1.1 of Exhibit 2 to the First Amendment, and which are attached hereto as Exhibit 2. The Estimated Highline Extension Cost totals Three Million Two Hundred Thirteen Thousand Ninety-Seven and 00/100 Dollars ($3,213,097.00), which amount exceeds the Over Highline Extension Cost of Two Million Two Hundred Thousand and 00/100 Dollars ($2,200,000.00), which difference of One Million Thirteen Thousand Ninety-Seven and 00/100 Dollars ($1,013,097) equals the "Highline Extension Differential Cost," as that term is defined in Section 1.1.1 of Exhibit 2 to the First Amendment. Upon completion of the Highline Extension, the Highline Extension Differential Cost shall be deducted from the Tenant Improvement Allowance. The actual costs to construct the Highline Extension shall be reconciled as provided in Section 1.1.2 of Exhibit 2 to the First Amendment.

3.2.Determination of Highline Extension Monthly Rent. The parties further acknowledge and agree that the Lease Commencement Date occurred on January 23, 2019 (such that February, 2019 is the first full calendar month of the Lease Term), and if the Expansion Space Commencement Date occurs on September 1, 2019, then the Highline Extension Monthly Rent shall be due in the amounts set forth on Exhibit 4 attached to the First Amendment. If the Expansion Space Commencement Date does not occur on September 1, 2019, then the Highline Extension Monthly Rent shall be calculated pursuant to the First Amendment.

4.Amenities Building. Notwithstanding anything contained in Section 1.1.4 of the Original Lease to the contrary, Tenant shall have the exclusive right during the Lease Term to use the Amenities Building for the uses made available by Landlord, provided that Tenant (together with its permitted assignees and/or sublessees in the aggregate) leases and occupies the entirety of the Premises, Building 1, Building 3 and Building 4.

5.Generator. If Tenant elects to replace the existing generator in the Building with a new generator up to 500kW, as contemplated in Section 4(o) of Schedule 1-B to Exhibit B of the Original Lease, the parties acknowledge and agree that such new generator will be part of the "Building Systems," as that term is defined in Section 7.1 of the Original Lease, but shall not be covered by "Landlord's Warranty," as that term is defined in Section 1.1.1 of the Original Lease.

6.Tenancies in Building and Project. Section 29.15 of the Original Lease is deleted in its entirety and replaced with the following:

"29.15 Right to Lease. Landlord reserves the absolute right to effect such other tenancies in the Project as Landlord in the exercise of its sole business judgment shall determine to best promote the interests of the Building or Project. Tenant does not rely on the fact, nor does Landlord represent, that any specific tenant or type or number of tenants shall, during the Lease Term, occupy any space in the Building or Project."

7.Right of First Offer. As of the Second Amendment Effective Date, Section 1.2 of the Original Lease, as amended by Section 14 of the First Amendment (inclusive of Subsections 1.2.1 through 1.2.6 of the Original Lease), shall be deleted in its entirety and shall be of no further force or effect whatsoever.

COLEMAN HIGHLINE

1155 Coleman Avenue

Building 2

-3-

Roku, Inc.

8.California Accessibility Disclosure. For purposes of Section 1938 of the California Civil Code, Landlord hereby reaffirms in full its disclosures set forth in and restates to Tenant in full the statements contained in Section 24.3 of the Original Lease.

9.Governing Law. This Second Amendment shall be governed by, construed and enforced in accordance with the laws of the State of California.

10.Counterparts. This Second Amendment may be executed in multiple counterparts, each of which is to be deemed original for all purposes, but all of which together shall constitute one and the same instrument. The signature page of any counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to any other counterpart identical thereto except having additional signature pages executed by other parties to this Second Amendment attached thereto. Landlord and Tenant agree that electronic signatures, including those delivered by PDF or signed through the electronic signature system known as "DocuSign", shall have the same effect as originals. All parties to this Second Amendment waive any and all rights to object to the enforceability of this Second Amendment based on the form or delivery of signature.

11.Effect of Second Amendment. Except as amended and/or modified by this Second Amendment, the Existing Lease is hereby ratified and confirmed and all other terms of the Existing Lease shall remain in full force and effect, unaltered and unchanged by this Second Amendment. In the event of any conflict between the provisions of this Second Amendment and the provisions of the Existing Lease, the provisions of this Second Amendment shall prevail. Whether or not specifically amended by the provisions of this Second Amendment, all of the terms and provisions of the Existing Lease are hereby amended to the extent necessary to give effect to the purpose and intent of this Second Amendment.

12.No Further Modification. Except as set forth in this Second Amendment, all of the terms and provisions of the Lease shall remain unmodified and in full force and effect.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

COLEMAN HIGHLINE

1155 Coleman Avenue

Building 2

-4-

Roku, Inc.

IN WITNESS WHEREOF, the parties have caused this Second Amendment to be duly executed by their duly authorized representatives as of the Second Amendment Effective Date.


LANDLORD:	CAP PHASE 1, LLC,
	a Delaware limited liability company

	By:	Coleman Airport Partners, LLC,
		a California limited liability company
	Its:	Sole Member

		By:	HS Airport, LLC,
			a California limited liability company
		Its:	Manager

			By:	/s/ Derek K. Hunter, Jr.
			Name:	Derek K. Hunter, Jr.
			Its:	Member

			By:	/s/ Edward D. Storm
			Name:	Edward D. Storm
			Its:	Member

TENANT:	ROKU, INC.,
	a Delaware corporation
	By:	/s/ Steve Louden
	Name:	Steve Louden
	Title:	Chief Financial Officer

	By:	/s/ Troy Fenner
	Name:	Troy Fenner
	Title:	Senior Vice President, HR

COLEMAN HIGHLINE

1155 Coleman Avenue

Building 2

-5-

Roku, Inc.

EXHIBIT 1

Highline Extension Plans


SHEET	TITLE	DATE	DESCRIPTION	PREPARED BY
ARCHITECTURAL
A0.0	COVER SHEET	4/15/2019	CITY SUBMITTAL	DEVCON
A1.0	SITE PLAN - FOR REFERENCE	4/15/2019	CITY SUBMITTAL	DEVCON
A1.1	FLOOR PLAN	4/15/2019	CITY SUBMITTAL	DEVCON
A3.1	EXTERIOR ELEVATIONS & BRIDGE SECTIONS	4/15/2019	CITY SUBMITTAL	DEVCON
A3.5	CROSS SECTIONS	4/15/2019	CITY SUBMITTAL	DEVCON
A3.6	CROSS SECTIONS	4/15/2019	CITY SUBMITTAL	DEVCON
A8.0	SECTIONS AND ENLARGED ELEVATION DETAILS	4/15/2019	CITY SUBMITTAL	DEVCON
A8.5	PLAN DETAILS	4/15/2019	CITY SUBMITTAL	DEVCON
STRUCTURAL
S1.01	GENERAL NOTES	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.02	TYPICAL CONCRETE DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.02A	TYPICAL CONCRETE DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.02B	TYPICAL CONCRETE DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.03	TYPICAL STEEL DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.03A	TYPICAL STEEL DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.03B	TYPICAL STEEL DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S1.03C	TYPICAL STEEL DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S2.01B	BRIDGE FOUNDATION PLAN	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S2.03B	BRIDGE FRAMING PLAN	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S4.01	FOUNDATION SECTIONS AND DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER
S5.01	SECTIONS AND DETAILS	4/15/2019	CITY SUBMITTAL	NISHKIAN MENNIGER

COLEMAN HIGHLINE

1155 Coleman Avenue

	EXHIBIT A	Building 2
	-1-	Roku, Inc.

EXHIBIT 2

Estimated Highline Extension Costs


SYSTEMS ESTIMATE
Project Name:	Coleman Highline
Project Description:	Alternate Options for B2 to A2 Highline Bridge
Drawings:	7644 Coleman Highline Bridge NM (Structural Plans), PDF dated 1/23/19
	Highline Bridge VE Options dated 1/18/2019
Date:	2/7/2019

System No.	Line Item		Picket Fence - Both Sides & Full Length (Precast Plank Pavers)

00	General Conditions	$	199,452
01	Structure	$	1,517,475
02	Exterior Envelope	$	193,500
03	Roofing / Moisture Protection	$	-
04	Finishes	$	326,040
05	Specialties	$	-
06	Equipment	$	-
07	Conveying Systems	$	-
08	Fire Protection	$	-
09	Plumbing	$	-
10	HVAC	$	-
11	Electrical	$	72,500
12	Sitework / Demolition	$	471,000

	Subtotal	$	2,779,967
	Architecture & Engineering	$	13,860
5.00%	DCI Contingency	$	138,998
	Subtotal	$	2,918,965
2.62%	Fee	$	76,477
	Testing & Inspections	$	-
	Plans & Energy Calcs.	$	-
	Blueprinting Allowance	$	-
	Permits & Fees	$	200,000
0.13%	Liability Insurance	$	3,795
	Subtotal	$	2,999,237
0.00%	Builder's Risk Insurance	$	-
0.00%	Bond	$	-
	Total	$	3,213,097

COLEMAN HIGHLINE

1155 Coleman Avenue

		Building 2
	-1-	Roku, Inc.

Exhibit 10.3

COLEMAN HIGHLINE

SECOND AMENDMENT TO OFFICE LEASE

THIS SECOND AMENDMENT TO OFFICE LEASE (this "Second Amendment") is made and entered into as of April 30, 2019 (the "Second Amendment Effective Date"), by and between CAP OZ 34, LLC, a Delaware limited liability company ("Landlord"), and ROKU, INC., a Delaware corporation ("Tenant").

R E C I T A L S :

A.Reference is hereby made to that certain Office Lease dated as of August 1, 2018 between Landlord and Tenant (the "Original Lease"), as amended by that certain First Amendment to Office Lease dated as of November 14, 2018 (the "First Amendment" and, together with the Original Lease, collectively, the "Existing Lease").

B.Pursuant to the Existing Lease, Tenant is currently leasing from Landlord a total of 380,951 RSF, as further set forth in Exhibit A to the Existing Lease, consisting of (i) the entirety of the 194,790 RSF of that certain six (6)-story building ("Building 3") to be located at 1173 Coleman Avenue, San Jose, California 95110, (ii) the entirety of the 163,272 RSF of that certain five (5)-story building ("Building 4") to be located at 1167 Coleman Avenue, San Jose, California 95110 and (iii) the entirety of the 22,889 RSF of that certain three (3)-story amenities building ("Building A2") to be located at 1161 Coleman Avenue, San Jose, California 95110. Building 3, Building 4, and Building A2 are collectively referred to herein as the "Buildings."

C.Tenant also currently leases within the Project the entirety of that certain six (6)-story building located at 1155 Coleman Avenue, San Jose, California 95110, commonly known as Building Two ("Building 2"), pursuant to that certain Office Lease, dated August 1, 2018, by and between CAP PHASE 1, LLC, a Delaware limited liability company ("CAP"), an affiliate of Landlord, as landlord, and Tenant, as tenant, as amended by that certain First Amendment to Office Lease, dated as of November 6, 2018 (collectively, the "Building 2 Lease"). Concurrently herewith, Tenant and CAP are entering into an amendment to the Building 2 Lease.

D.Additionally, concurrently herewith, Tenant is assuming from 8x8, Inc., a Delaware corporation ("8x8"), the tenant's interest in and to that certain Coleman Highline Office Lease, dated as of January 23, 2018, with CAP, as landlord, for the lease of the entirety of that certain five (5) story building located at 1143 Coleman Avenue, San Jose, California, commonly known as Building One ("Building 1") situated within the Project, pursuant to that certain Assignment and Assumption of Lease, Landlord's Consent and First Amendment of Lease dated of even date herewith.

E.Landlord and Tenant now desire to amend the Existing Lease to, among other things, (i) extend the date by which Tenant must utilize the Tenant Improvement Allowance; and (ii) approve the construction of the Skybridge (as that term is defined in Section 5 below); and (iii) modify various other terms and provisions of the Existing Lease, all as hereinafter provided.

A G R E E M E N T

1.Capitalized Terms. All capitalized terms when used herein shall have the same meaning as is given such terms in the Existing Lease unless expressly superseded by the terms of this Second Amendment.


	COLEMAN HIGHLINE
	1173, 1167 & 1161 Coleman Avenue
	Building 3, 4 and A2
-1-	Roku, Inc.

2.Tenant Improvement Allowance. The final sentence of Section 2.1 of Exhibit B attached to the Original Lease is hereby deleted in its entirety and replaced with the following:"Any unused portion of the portion of the Tenant Improvement Allowance attributable to the Building 3 Premises remaining as of April 20, 2020 (the "Building 3 Premises TIA Deadline") shall remain with Landlord, and Tenant shall have no further right thereto; provided however, that if the Delivery Date for the Building 3 Premises has not occurred on or before September 24, 2019 (except only if such delay is as a result of and directly related to Landlord’s construction of the Skybridge Work), then the Building 3 Premises TIA Deadline shall be extended by one (1) day for each day following September 24, 2019 until the Delivery Date for the Building 3 Premises has occurred. Any unused portion of the portion of the Tenant Improvement Allowance attributable to the Building 4 Premises remaining as of April 20, 2020 (the "Building 4 Premises TIA Deadline") shall remain with Landlord, and Tenant shall have no further right thereto; provided however, that if the Delivery Date for the Building 4 Premises has not occurred on or before September 24, 2019 (except only if such delay is as a result of and directly related to Landlord’s construction of the Skybridge Work), then the Building 4 Premises TIA Deadline shall be extended by one (1) day for each day following September 24, 2019 until the Delivery Date for the Building 4 Premises has occurred."

3.Generator. If Tenant elects to replace the existing generator in the Building with a new generator up to 500kW, as contemplated in Section 4(o) of Schedule 1-B to Exhibit B of the Original Lease, the parties acknowledge and agree that such new generator will be part of the "Building Systems," as that term is defined in Section 7.1 of the Original Lease, but shall not be covered by "Landlord's Warranty," as that term is defined in Section 1.1.1 of the Original Lease.

4.Right of First Offer. As of the Second Amendment Effective Date, Section 1.2 of the Original Lease (inclusive of Subsections 1.2.1 through 1.2.7 of the Original Lease) shall be deleted in its entirety and shall be of no further force or effect whatsoever. The parties acknowledge that Tenant and Cap Tranche 2, LLC (an affiliate of Landlord) have previously entered into and recorded that certain Right of First Offer Agreement dated as of August 1, 2018 and recorded on August 16, 2018 in the Official Records of Santa Clara County as Document No. 24004815 (the "ROFO Agreement"). The ROFO Agreement is hereby terminated and promptly following the mutual execution and delivery of this Second Amendment, Tenant shall enter into and deliver to Landlord a termination of the ROFO Agreement in form and substance reasonably satisfactory to Landlord.

5.Skybridge. Landlord shall construct a pedestrian bridge (the "Skybridge") connecting the fifth (5^th) floor of Building 3 to the fifth (5^th) floor of Building 4, as depicted on Exhibit 1 attached hereto, and in accordance with the plans and specifications described on Exhibit 2 attached hereto. The Skybridge shall be constructed in a good and workmanlike manner, and in compliance with Applicable Laws for unoccupied space as of the Second Amendment Effective Date to the extent required to allow Tenant, subject to Tenant's construction of the Tenant Improvements in accordance with Applicable Laws, to obtain a certificate of occupancy or its legal equivalent allowing the legal occupancy of the Premises for the Permitted Use.

5.1.Use of Skybridge. For so long as Tenant leases the entirety of the fifth (5^th) floors of both Building 3 and Building 4, Tenant shall have the exclusive right to use the Skybridge, and the Skybridge shall be treated as part of the Premises for all purposes under the Lease, except that the rentable square footage of the Skybridge shall not be included in the total rentable square footage of the Premises, and further provided that the structural components of the Skybridge shall be part of the Building Structure. Tenant shall not install any signage on the exterior of the Skybridge, or on the interior of the Skybridge that is visible from the exterior of the Skybridge.

5.2.Construction of Skybridge. Landlord shall diligently design, engineer, obtain all required permits for and construct the Skybridge (the "Skybridge Work"). Landlord shall have no liability whatsoever to Tenant relating to or arising from Landlord's inability or failure to cause all or any portion of the Skybridge to be constructed if such failure results from Landlord's failure to obtain the necessary permits and governmental approvals for the performance of the Skybridge Work unless such failure is directly the result of Landlord's failure to make reasonable good faith efforts to obtain such permits and approvals. The completion of the Skybridge shall not be a requirement for Delivery Condition or Final Condition, and furthermore the Delivery Date and Final Condition Date shall be deemed to occur on the dates that the same would have occurred, solely but for the performance of the Skybridge Work. Specifically, (i) the performance of the Skybridge Work will require certain sections of glass on the exterior of the Buildings to not be installed until completion of the Skybridge Work (or to be installed and then removed or modified as part of the Skybridge Work), which may impact Landlord's ability to obtain a CofO for the Base, Shell and Core, and, accordingly, Landlord shall be deemed to have obtained obtain a CofO for the Base, Shell and Core on the date Landlord would have obtained a CofO for the Base, Shell and


	COLEMAN HIGHLINE
	1173, 1167 & 1161 Coleman Avenue
	Building 3, 4 and A2
-2-	Roku, Inc.

Core, solely but for the glass not being installed or being installed and then removed and (ii) completion of site work in the areas of the utility yard, sculpture garden and arrival court may be delayed due to staging for and construction of the Skybridge, and none of the foregoing shall result in any Landlord Caused Delay or the occurrence of the Delivery Date or Final Condition Date. Tenant shall be solely responsible for all of the actual direct third-party costs to construct the Skybridge Work, including any increased actual third party costs of construction to the extent caused solely by any interference of the Skybridge Work with the remainder of the construction of the Base, Shell and Core, which increased costs could not have been reasonably avoided by Landlord, and subject in all events to Landlord having notified Tenant in writing prior to incurring any such increased costs (the "Skybridge Work Costs"), which shall be deducted from the Tenant Improvement Allowance (or paid directly by Tenant within thirty (30) days of written request, including the delivery of reasonable supporting documentation, to the extent Tenant Improvement Allowance funds are not available). The initial estimate of the Skybridge Work Costs is attached hereto as Exhibit 3.

5.3.Removal of Skybridge. Upon the date that is the earlier of (a) the expiration or earlier termination of the Lease, as amended, or (b) the date that Tenant no longer leases the entirety of both the fifth (5^th) floors of Building 3 and Building 4, Tenant shall, at Landlord's option (i) cause the removal of the Skybridge, or (ii) cause the sealing off of the Buildings at the entry point to the Skybridge (collectively, the "Skybridge Removal Work") and restore all areas of the Buildings affected by the Skybridge Removal Work. Notwithstanding the foregoing, Landlord shall have the right to perform the Skybridge Removal Work, at Tenant's sole cost and expense.

6.California Accessibility Disclosure. For purposes of Section 1938 of the California Civil Code, Landlord hereby reaffirms in full its disclosures set forth in and restates to Tenant in full the statements contained in Section 24.3 of the Original Lease, which disclosures and statements hereby refer to the Generator Area as part of the Premises.

7.Tenancies in Buildings and Project. Section 29.15 of the Original Lease is hereby amended as follows:

7.1.The third sentence is deleted in its entirety and replaced with the following: "Landlord shall not, without the prior written consent of Tenant, which may be granted or withheld in Tenant's sole and absolute discretion, enter into any lease or other occupancy agreement with, or consent to an assignment or subletting (except in the case of a "permitted transfer" to an affiliate entity or similar transfer for which Landlord's prior consent is not required) to, any Tenant Competitor for the entirety of the building within the Project, if and once constructed, to be known as “Building 5” depicted on the site plan attached hereto as Exhibit A-1 and located at 1179 Coleman Avenue, San Jose, California 95110 (the "Competitor Restricted Area") (or any portion thereof)."

7.2.The fourth sentence is deleted in its entirety and replaced with the following: "For purposes hereof, the term "Tenant Competitor" shall mean Amazon.com, Inc. or any subsidiary of Amazon.com, Inc. if such subsidiary's primary products or services compete with the products and services offered by Tenant as its primary business (as reasonably determined by Tenant and as such products and services may change and expand from time to time)."

7.3.The fifth sentence is deleted in its entirety and replaced with the following: "Notwithstanding anything herein to the contrary, Landlord shall not be deemed to have violated the terms of this Section 29.15 if: (i) any tenant or occupant merges or consolidates with or into, or acquires or is acquired by, any Tenant Competitor; (ii) Landlord is required to permit such lease pursuant to a court order; (iii) Landlord, after a reasonable inquiry, in good faith believes that any prospective tenant is not a Tenant Competitor; or (iv) a Tenant Competitor leases both (a) the entirety of the Competitor Restricted Area and (b) two (2) or more additional office buildings in Tranche 2 of the Project constituting more than 350,000 rentable square feet in the aggregate."

Promptly following the mutual execution and delivery of this Second Amendment, Landlord shall cause its affiliate, Cap Tranche 2, LLC, to enter into and record against the Competitor Restricted Area in the Official Records of Santa Clara County a memorandum that reflects the terms and conditions contained in Section 29.15 of the Original Lease, as amended by this Section 7, in form mutually and reasonably satisfactory to Landlord and Tenant.

8.Governing Law. This Second Amendment shall be governed by, construed and enforced in accordance with the laws of the State of California.


	COLEMAN HIGHLINE
	1173, 1167 & 1161 Coleman Avenue
	Building 3, 4 and A2
-3-	Roku, Inc.

9.Counterparts. This Second Amendment may be executed in any number of counterparts, each of which shall be deemed an original, but all of which when taken together will constitute one and the same instrument. The signature page of any counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to any other counterpart identical thereto except having additional signature pages executed by other parties to this Second Amendment attached thereto. Landlord and Tenant agree that electronic signatures, including those delivered by PDF or signed through the electronic signature system known as "DocuSign", shall have the same effect as originals. All parties to this Second Amendment waive any and all rights to object to the enforceability of this Second Amendment based on the form or delivery of signature.

10.Effect of Second Amendment. Except as amended and/or modified by this Second Amendment, the Existing Lease is hereby ratified and confirmed and all other terms of the Existing Lease shall remain in full force and effect, unaltered and unchanged by this Second Amendment. In the event of any conflict between the provisions of this Second Amendment and the provisions of the Existing Lease, the provisions of this Second Amendment shall prevail. Whether or not specifically amended by the provisions of this Second Amendment, all of the terms and provisions of the Existing Lease are hereby amended to the extent necessary to give effect to the purpose and intent of this Second Amendment.

11.No Further Modification. Except as set forth in this Second Amendment, all of the terms and provisions of the Existing Lease shall remain unmodified and in full force and effect.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]


	COLEMAN HIGHLINE
	1173, 1167 & 1161 Coleman Avenue
	Building 3, 4 and A2
-4-	Roku, Inc.

IN WITNESS WHEREOF, the parties have caused this Second Amendment to be duly executed by their duly authorized representatives as of the Second Amendment Effective Date.

LANDLORD"

CAP OZ 34, LLC

a Delaware limited liability company


By:	CAP OZ I, LLC,
	a Delaware limited liability company
Its:	Sole Member

	By:	HS Airport 2, LLC,
		a California limited liability company
	Its:	Manager

		By:	/s/ Derek K. Hunter, Jr.
		Name:	Derek K. Hunter, Jr.
		Its:	Member

"TENANT"

Roku, Inc.

a Delaware corporation


By:		/s/ Steve Louden
Name:		Steve Louden
Its:		Chief Financial Officer

By:		/s/ Troy Fenner
Name:		Troy Fenner
Its:		Senior Vice President, HR


	COLEMAN HIGHLINE
	1173, 1167 & 1161 Coleman Avenue
	Building 3, 4 and A2
-5-	Roku, Inc.

EXHIBIT 1

SKYBRIDGE PLANS AND SPECIFICATIONS

SHEET	TITLE	DATE	DESCRIPTION	PREPARED BY
ARCHITECTURAL
SB-AO.O	COVER SHEET - SKY BRIDGE	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A1.0	SITE PLAN (FOR REFERENCE ONLY)	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A2.0	BLDG 3 AND 4 - 5TH FLOOR PLAN (FOR REFERENCE ONLY)	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A2.1	SKY BRIDGE - FLOOR PLANS	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A3.1	SITE ELEVATIONS (FOR REFERENCE ONLY)	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A3.2	SITE ELEVATIONS (FOR REFERENCE ONLY)	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A3.3	SKY BRIDGE - ELEVATIONS AND SECTIONS	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A3.4	SKY BRIDGE - ELEVATIONS AND SECTIONS	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A3.5	SKY BRIDGE - ELEVATIONS AND SECTIONS	4/15/2019	CITY SUBMITTAL	DEVCON
SB-A6.1	SKY BRIDGE - REFLECTED CEILING PLANS	4/15/2019	CITY SUBMITTAL	DEVCON
STRUCTURAL
SB-S6.2	SKY BRIDGE PLANS AND DETAILS	4/15/2019	CITY SUBMITTAL	NISKIAN MENNINGER
SB-S6.2A	SKY BRIDGE DETAILS	4/15/2019	CITY SUBMITTAL	NISKIAN MENNINGER


		COLEMAN HIGHLINE
		1173, 1167 & 1161 Coleman Avenue
	EXHIBIT 2	Building 3, 4 and A2
	-1-	Roku, Inc.

EXHIBIT 2

ESTIMATE OF SKYBRIDGE WORK COSTS

BUDGET PRICING FOR Tenant Requests (Roku)


Project Name:	Coleman Highline
Project Desc:	Buildings 2, 3 & 4
Job No:	18-063
Drawings:	N/A
Date:	N/A


TCR 2	Sky Bridge at Building 3 & 4 @ Level 5	Total
1	General Conditions.	$150,000
2	Staking	$11,000
3	Final Clean Up	$16,000
4	Concrete Work	$100,000
5	Precast Concrete	$275,000
6	Structural Steel	$2,750,000
7	Metal Decking	$40,000
8	Metal Stairs & Railings	$140,000
9	Thermal Insulation (Exterior)	$95,000
10	Roofing	$50,000
11	Flashing & Sheetmetal	$60,000
12	Applied Fireproofing	$55,000
13	Doors / Frames / Hardware (Excluded)	Excluded
14	Glass & Glazing	$2,250,000
15	Metal Studs & Drywall Exterior	$180,000
16	Flooring (Excluded)	Excluded
17	Window Washing Systems (Excluded)	Exlcuded
18	Fire Sprinklers	$15,000
19	Plumbing	$55,000
20	HVAC	$110,000
21	Electrical	$80,000
22	Blueprinting	Excluded
	Subtotal	$6,432,000
	Contingency: 5%	$321,6000
	Subtotal	$6,753,600
	OH&P: 2.62%	$176,944
	Insurance" .13%	$8,780
	Subtotal	$6,939,324
	Architecture & Engineering
	Permit Fee Allowance	$149,170
		$200,000
	GRAND TOTAL	$7,288,494


		COLEMAN HIGHLINE
		1173, 1167 & 1161 Coleman Avenue
	EXHIBIT 3	Building 3, 4 and A2
	-1-	Roku, Inc.

Exhibit 10.4

INCREMENTAL ASSUMPTION AND AMENDMENT NO. 1

INCREMENTAL ASSUMPTION AND AMENDMENT NO. 1, dated as of May 3, 2019 (this “Incremental Amendment”), to the Existing Credit Agreement referred to below, among Roku, Inc., a Delaware corporation (together with its successors and assigns, the “Borrower”), Morgan Stanley Senior Funding, Inc., as Administrative Agent (as defined below) and Issuing Bank (as defined below), Citibank, N.A., as Issuing Bank and MUFG Union Bank, N.A., as an Incremental Term Lender, as an Incremental Revolving Lender and as an Issuing Bank (in such capacities, the “Incremental Lender”).

RECITALS:

1.The Borrower has entered into that certain Credit Agreement, dated as of February 19, 2019 (as amended, amended and restated, supplemented or otherwise modified from time to time, prior to the date hereof, the “Existing Credit Agreement”, and as amended hereby, the “Credit Agreement”), among the Borrower, the several lenders party thereto from time to time and the issuing banks party thereto from time to time (each in such capacity, an “Issuing Bank”) and Morgan Stanley Senior Funding, Inc., as administrative agent for the Lenders (in such capacity, the “Administrative Agent”).

2.Pursuant to and in accordance with Section 2.17 of the Existing Credit Agreement, the Borrower has requested that (i) Incremental Term Loan Commitments in an aggregate principal amount equal to $25,000,000 be made available to the Borrower, and the Incremental Lender and the Administrative Agent have agreed, upon the terms and subject to the conditions set forth herein, that the Incremental Lender will make Incremental Term Loans on the same terms as the Initial Term A Loans, and shall form part of the same Class of Initial Term A Loans, in an aggregate principal amount equal to $25,000,000 (the “Incremental Initial Term A Loan Commitment” and the Loans in connection therewith, the “Incremental Initial Term A Loans”) and (ii) Incremental Revolving Credit Commitments to make Incremental Revolving Loans in an aggregate principal amount equal to $25,000,000 be made available to the Borrower, and the Incremental Lender and the Administrative Agent have agreed, upon the terms and subject to the conditions set forth herein, that the Incremental Lender will (a) make Incremental Revolving Loans on the same terms as the Initial Revolving Loans and shall form part of the same Class of Initial Revolving Loans in an aggregate principal amount equal to $25,000,000 (the “Incremental Initial Revolving Credit Commitments”, the Loans in connection therewith, the “Incremental Initial Revolving Loans” and, together with the Incremental Initial Term A Loan Commitments, the “Incremental Commitments”) and (b) become an Issuing Bank and issue Letters of Credit at the request and for the account of the Borrower in an aggregate amount not to exceed its Letter of Credit Issuer Sublimit equal to $25,000,000 (the “Incremental Letter of Credit Issuer Sublimit”), in each case, resulting in Commitments and Letter of Credit Issuer Sublimits under the Credit Agreement as set forth in Schedule 1.01A attached hereto.

3.In consideration of the covenants and agreements contained herein, as well as other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Section 1.Defined Terms. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Credit Agreement.

Section 2.Incremental Amendment of the Existing Credit Agreement.

(a) The Borrower and the Incremental Lender hereby agree that, subject to the satisfaction of the conditions set forth herein, on the Incremental Amendment No. 1 Effective Date (as defined below), the Incremental Initial Revolving Credit Commitments and the Incremental Initial Term A Loan Commitments of the Incremental Lender shall be effective.

(b) Except as otherwise expressly set forth herein, (i) the Incremental Initial Revolving Loans and the Incremental Initial Revolving Credit Commitments shall have terms that are identical to those of, and shall form the same Class as, the Initial Revolving Loans and Initial Revolving Credit Commitments, respectively, and (ii) the Incremental Initial Term A Loans and the Incremental Initial Term A Loan Commitments shall have terms that are identical to those of, and shall form the same Class as, the Initial Term A Loans and Initial Term A Loan Commitments, respectively, in each case, existing immediately prior to the Incremental Amendment No. 1 Effective Date, including, without limitation, with respect to the maturity date, weighted average life, interest rate margins, amortization, commitment reductions and prepayments, in each case, in accordance with Section 2.17(b) of the Existing Credit Agreement.

(c) The Borrower hereby designates the Incremental Lender as an “Issuing Bank” under the Credit Agreement and the other Loan Documents, and the Incremental Lender hereby agrees to act as and shall constitute an “Issuing Bank” under and in accordance with the Credit Agreement and the other Loan Documents, with a Letter of Credit Issuer Sublimit equal to its respective Incremental Letter of Credit Issuer Sublimit hereunder.

(d) It is understood and agreed that (i) the Incremental Initial Term A Loans are “Incremental Term Loans”, the Incremental Lender is an “Incremental Term Loan Lender”, the Incremental Initial Term A Loan Commitment is an “Incremental Term Loan Commitment” and this Incremental Amendment is an “Incremental Term Loan Amendment”, in each case, as defined in the Existing Credit Agreement and (ii) the Incremental Initial Revolving Loans are “Incremental Revolving Loans”, the Incremental Lender is an “Incremental Revolving Lender” and “Revolving Lender”, the Incremental Initial Revolving Credit Commitment is an “Incremental Revolving Credit Commitment” and “Revolving Credit Commitment” and this Incremental Amendment is an “Incremental Assumption Agreement”, in each case, as defined in the Existing Credit Agreement.

(e) The Incremental Lender acknowledges and agrees that upon its execution of this Incremental Amendment and the occurrence of the Incremental Amendment No. 1 Effective Date, that the Incremental Lender shall become (i) a “Lender”, “Revolving Lender” and “Initial Revolving Lender” with respect to its Incremental Initial Revolving Credit Commitment and (ii) a “Lender”, “Term Loan Lender” and “Initial Term A Lender” with respect to its Incremental Initial Term A Loan Commitment, in each case, under, and for all purposes of, the Credit Agreement and the other Loan Documents, and shall be subject to and bound by the terms thereof, and shall perform all the obligations of and shall have all rights of a Lender thereunder.

(f) It is further understood and agreed that this Incremental Amendment and the Credit Agreement are each a “Loan Document”, as defined in the Existing Credit Agreement.

Section 3.Conditions to Effectiveness of Incremental Amendment. The effectiveness of this Incremental Amendment, including the obligation of the Incremental Lender to provide its Incremental Commitments, make Incremental Initial Term A Loans or Incremental Initial Revolving Loans or issue Letters of Credit is subject, in each case, to the satisfaction or waiver of the following conditions (the date of such satisfaction or waiver of such conditions being referred to herein as the “Incremental Amendment No. 1 Effective Date”):

(a) The Administrative Agent shall have received this Incremental Amendment executed and delivered by a duly authorized officer of the Borrower and the Incremental Lender.

(b) The Administrative Agent shall have received, on behalf of itself and the Incremental Lender, customary officer’s closing certificates, organizational documents, customary evidence of authorization and good standing certificates in jurisdictions of formation or organization, in each case, with respect to each Loan Party. All documents and instruments required to create and perfect the Administrative Agent’s security interests in the Collateral shall have been executed and delivered by each Loan Party (or, where applicable, each Loan Party shall have authorized the filing of financing statements under the Uniform Commercial Code) and, if applicable, be in proper form for filing.

(c) A certificate of a Responsible Officer of the Borrower certifying that (i) the conditions in clauses (g) and (h) of this Section 3 have been satisfied and (ii) the Incremental Loans are being incurred in reliance on Section 2.17(a)(i)(z) of the Existing Credit Agreement.

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(d) To the extent such documentation has not previously been delivered in connection with the effectiveness of the Existing Credit Agreement, the Administrative Agent, Incremental Lender shall have received at least three (3) business days prior to the Incremental Amendment No. 1 Effective Date, all documentation and other information required with respect to each Loan Party by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the USA PATRIOT Act to the extent reasonably requested in writing by the Administrative Agent or any Incremental Lender at least ten (10) business days prior to the Incremental Amendment No. 1 Effective Date. To the extent the Borrower qualifies as a “legal entity customer” under 31 C.F.R. § 1010.230 (the “Beneficial Ownership Regulation”) and the Incremental Lender has requested, in a written notice to the Borrower at least ten (10) business days prior to the Incremental Amendment No. 1 Effective Date, a beneficial ownership certification as required by the Beneficial Ownership Regulation in relation to the Borrower, the Incremental Lender shall have received such beneficial ownership certification at least three (3) business days prior to the Incremental Amendment No. 1 Effective Date.

(e) All fees and expenses (in the case of expenses, to the extent invoiced at least three (3) business days prior to the Incremental Amendment No. 1 Effective Date (except as otherwise reasonably agreed by the Borrower)), required to be paid on the Incremental Amendment No. 1 Effective Date, shall have been paid.

(f) The Administrative Agent shall have received a certificate from the chief financial officer of the Borrower, in substantially the form of Exhibit G to the Existing Credit Agreement, certifying that the Borrower and its Subsidiaries, on a consolidated basis after giving effect to the transactions contemplated hereby, are solvent.

(g) no Default shall have occurred and be continuing.

(h) As of the Incremental Amendment No. 1 Effective Date, the representations and warranties of each Loan Party set forth in the Existing Credit Agreement and any other Loan Document shall be true and correct in all material respects (or in all respects to the extent that any representation and warranty is qualified by materiality or Material Adverse Effect), except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date.

Section 4.Effects on Loan Documents; Acknowledgement.

(a) Except as expressly set forth herein, this Incremental Amendment shall not (i) by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders, the Administrative Agent, the Collateral Agent or any Loan Party under the Existing Credit Agreement or any other Loan Document or (ii) alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Existing Credit Agreement or any other provision of the Existing Credit Agreement or any other Loan Document. Except as expressly set forth herein, each and every term, condition, obligation, covenant and agreement contained in the Existing Credit Agreement or any other Loan Document is hereby ratified and re-affirmed in all respects and shall continue in full force and effect and nothing herein can or may be construed as a novation thereof. Each Loan Party reaffirms its obligations under the Loan Documents to which it is party and the validity, enforceability and perfection of the Liens granted by it pursuant to the Security Agreement on the Incremental Amendment No. 1 Effective Date. This Incremental Amendment shall constitute a Loan Document for purposes of the Credit Agreement and from and after the Incremental Amendment No. 1 Effective Date, all references to the “Credit Agreement” in any Loan Document and all references in the Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit Agreement, shall, unless expressly provided otherwise, refer to the Credit Agreement as amended by this Incremental Amendment. Each Loan Party hereby consents to this Incremental Amendment and confirms that all obligations of such Loan Party under the Loan Documents to which such Loan Party is a party shall continue to apply to the Credit Agreement, as amended hereby.

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(b) Without limiting the foregoing, each Loan Party party to the Guaranty and Security Agreement hereby (i) acknowledges and agrees that the Incremental Loans are Loans and the Incremental Lender is a Lender, (ii) acknowledges and agrees that all of its obligations under the Guaranty and Security Agreement are reaffirmed and remain in full force and effect on a continuous basis, (iii) reaffirms each Lien granted by each Loan Party to the Collateral Agent for the benefit of the Secured Parties (including the Incremental Lender) and reaffirms the guaranties made pursuant to the Guaranty and Security Agreement, (v) acknowledges and agrees that the grant of security interests by and the guarantee of each Loan Party contained in the Guaranty and Security Agreement are, and shall remain, in full force and effect after giving effect to this Incremental Amendment, (vi) agrees that the Secured Obligations include, among other things and without limitation, the prompt and complete payment and performance by the Borrower when due and payable (whether at the stated maturity, by acceleration or otherwise) of principal and interest on, the Incremental Initial Term A Loans and Incremental Initial Revolving Loans, and (vii) agrees that all Secured Obligations are Guarantied Obligations (as defined in the Guaranty and Security Agreement).

(c) As of the Incremental Amendment No. 1 Effective Date, the Incremental Lender (i) has agreed to the amendment of the Existing Credit Agreement as set forth herein, (ii) confirms that it has received a copy of the Existing Credit Agreement and the other Loan Documents and the exhibits thereto and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Agreement; (ii) has agreed that it will, independently and without reliance upon the Administrative Agent, the Collateral Agent or any other Lender or Agent, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iii) appoints and authorizes the Administrative Agent and the Collateral Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to the Administrative Agent or the Collateral Agent, as the case may be, by the terms thereof, together with such powers as are reasonably incidental thereto; and (iv) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

Section 5.Counterparts. This Incremental Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which when taken together shall constitute a single instrument. Delivery of an executed counterpart of a signature page of this Incremental Amendment by facsimile or any other electronic transmission shall be effective as delivery of a manually executed counterpart hereof.

Section 6.GOVERNING LAW. THIS INCREMENTAL AMENDMENT, THE OTHER LOAN DOCUMENTS AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSES OF ACTIONS ARISING THEREFROM (WHETHER IN CONTRACT OR TORT OR OTHERWISE) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

Section 7.Headings. The headings of this Incremental Amendment are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.

[Remainder of page intentionally left blank.]

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IN WITNESS WHEREOF, the parties hereto have caused this Incremental Amendment to be executed and delivered by their respective duly authorized officers as of the date first above written.

ROKU, INC.

By:	/s/ Steve Louden
	Name:	Steve Louden
	Title:	Chief Financial Officer

[Signature Page to Roku Incremental Amendment No.1]

MORGAN STANLEY SENIOR FUNDING, INC.,
as Administrative Agent

By:	/s/ Jonathon Rauen
	Name:	Jonathon Rauen
	Title:	Authorized Signatory

Signature Page To Incremental Assumption And Amendment To Credit Agreement

MORGAN STANLEY SENIOR FUNDING,
INC.,
as Issuing Bank

By:	/s/ Jonathon Rauen
	Name:	Jonathon Rauen
	Title:	Authorized Signatory

Signature Page To Incremental Assumption And Amendment To Credit Agreement

CITIBANK, N.A.,
as Issuing Bank

By:	/s/ Sigrid Nubla
	Name:	Sigrid Nubla
	Title:	Director

Signature Page To Incremental Assumption And Amendment To Credit Agreement

MUFG Union Bank, N.A., as Incremental
Lender and Issuing Bank

By:	/s/ Ronald J. Drobny
	Name:	Ronald J. Drobny
	Title:	Director

Signature Page To Incremental Assumption And Amendment To Credit Agreement

Schedule 1.01A

COMMITMENTS

Initial Revolving Credit Commitments

Morgan Stanley Senior Funding, Inc.		$37,500,000

Citibank, N.A.		$37,500,000

MUFG Union Bank, N.A.		$25,000,000

Total		$100,000,000

Letter of Credit Issuer Sublimit

Morgan Stanley Senior Funding, Inc.		$25,000,000

Citibank, N.A.		$25,000,000

MUFG Union Bank, N.A.		$25,000,000

Total		$75,000,000

Initial Term A Loan Commitments

Morgan Stanley Senior Funding, Inc.		$37,500,000

Citibank, N.A.		$37,500,000

MUFG Union Bank, N.A.		$25,000,000

Total		$100,000,000

Exhibit 10.6

Roku, Inc.

Restricted Stock Unit Grant Notice

(2017 Equity Incentive Plan)

Roku, Inc. (the “Company”), pursuant to its 2017 Equity Incentive Plan (the “Plan”), hereby awards to Participant a Restricted Stock Unit Award for the number of shares of the Company’s Common Stock (“Restricted Stock Units”) set forth below (the “Award”). The Award is subject to all of the terms and conditions as set forth in this notice of grant (this “Restricted Stock Unit Grant Notice”), the Restricted Stock Unit Award Agreement, including any special terms and conditions for Participant’s country set forth in the appendix attached to the Award Agreement as Exhibit A (the “Appendix” and, together with the Restricted Stock Unit Award Agreement, the “Award Agreement”), and in the Plan, all of which are attached hereto and incorporated herein in their entirety. Capitalized terms not otherwise defined herein will have the meanings set forth in the Plan or the Award Agreement. In the event of any conflict between the terms in this Restricted Stock Unit Grant Notice, the Award Agreement and/or the Plan, the terms of the Plan will control.

	Participant:
	Date of Grant:
	Number of Restricted Stock Units/Shares:

Vesting Schedule:

The first scheduled vest of the shares subject to the Award will vest on and the remaining shares will vest in equal quarterly installments thereafter for so long as Participant remains in Continuous Service, such that at the end of such quarterly installments, the Award will be fully vested. The quarterly installments will vest on the dates of March 1, June 1, September 1, and November 15 (or the next business day if such date falls on a holiday or weekend). Please note the full vest schedule below:

Vesting tranches:
Number of shares subject to vest:	Date subject to vest:

Total shares:

Issuance Schedule:		The shares of Common Stock to be issued in respect of the Award will be issued in accordance with the issuance schedule set forth in Section 6 of the Award Agreement.

Additional Terms/Acknowledgements: Participant acknowledges receipt of, and understands and agrees to all of the terms and conditions set forth in this Restricted Stock Unit Grant Notice, the Award Agreement and the Plan. Participant acknowledges and agrees that this Restricted Stock Unit Grant Notice and the Award Agreement may not be modified, amended or revised except as provided in the Award Agreement and the Plan. Participant further acknowledges that as of the Date of Grant, this Restricted Stock Unit Grant Notice, the Award Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the acquisition of Common Stock pursuant to the Award and supersede all prior oral and written agreements on that subject with the exception, if applicable, of (i) equity awards previously granted and delivered to Participant, (ii) any compensation recovery policy that is adopted by the Company or is otherwise required by applicable law, and (iii) any written employment or severance arrangement that would provide for vesting acceleration of this Award upon the terms and conditions set forth therein.

By accepting this Award, Participant consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

By providing an additional signature below or by electronically accepting this Award Agreement pursuant to the Company’s instructions to Participant (including through an online acceptance process), Participant declares that he or she expressly agrees with the data processing practices described in Section 14 of the Award Agreement and consents to the collection, processing and use of Data (as defined in Section 14 of the Award Agreement) by the Company and the transfer of Data to the recipients mentioned in Section 14 of the Award Agreement, including recipients located in countries which do not provide an adequate level of protection from a European (or other non-U.S.) data protection law perspective, for the purposes described in Section 14 of the Award Agreement. Participant understands that, as a condition of receiving the Award, Participant must provide his or her signature below or electronically accept this Award, otherwise the Company may forfeit the Restricted Stock Units. Participant understands that he or she may withdraw consent at any time with future effect for any or no reason as described in Section 14 of the Award Agreement.

Participant:

Signature

Attachments:

Award Agreement and 2017 Equity Incentive Plan

Attachment I

Roku, Inc.

2017 Equity Incentive Plan

Restricted Stock Unit Award Agreement

Pursuant to the Restricted Stock Unit Grant Notice (the “Grant Notice”) and this Restricted Stock Unit Agreement (including any special terms and conditions for your country set forth in the appendix attached hereto as Exhibit A (the “Appendix” and, together with the Restricted Stock Unit Award Agreement, the “Award Agreement”), Roku, Inc. (the “Company”) has awarded you a Restricted Stock Unit Award (the “Award”) pursuant to Section 6 of the Company’s 2017 Equity Incentive Plan (the “Plan”) for the number of Restricted Stock Units/shares indicated in the Grant Notice. Capitalized terms not explicitly defined in this Award Agreement or the Grant Notice will have the same meanings given to them in the Plan. The terms of your Award, in addition to those set forth in the Grant Notice and the Plan, are as follows.

1.Grant of the Award. This Award represents the right to be issued on a future date one (1) share of Common Stock for each Restricted Stock Unit that vests on the applicable vesting date(s) (subject to any adjustment under Section 3 below) as indicated in the Grant Notice. As of the Date of Grant, the Company will credit to a bookkeeping account maintained by the Company, or a third party designated by the Company, for your benefit (the “Account”) the number of Restricted Stock Units/shares of Common Stock subject to the Award. Except as otherwise provided herein, you will not be required to make any payment to the Company or an Affiliate with respect to your receipt of the Award, the vesting of the Restricted Stock Units or the delivery of the Company’s Common Stock to be issued in respect of the Award. Notwithstanding the foregoing, the Company reserves the right to issue you the cash equivalent of Common Stock, in part or in full satisfaction of the delivery of Common Stock upon vesting of your Restricted Stock Units, and, to the extent applicable, references in this Award Agreement and the Grant Notice to Common Stock issuable in connection with your Restricted Stock Units will include the potential issuance of its cash equivalent pursuant to such right, unless otherwise provided for your country in the Appendix.

2.Vesting. Subject to the limitations contained herein, your Award will vest, if at all, in accordance with the vesting schedule provided in the Grant Notice, provided that vesting will cease upon the termination of your Continuous Service. Upon such termination of your Continuous Service, the Restricted Stock Units/shares of Common Stock credited to the Account that were not vested on the date of such termination will be forfeited at no cost to the Company and you will have no further right, title or interest in or to such underlying shares of Common Stock.

For purposes of your Award, your Continuous Service will be considered terminated (regardless of the reason of termination, whether or not later found to be invalid or in breach of employment or other laws or rules in the jurisdiction where you are providing services or the terms of your employment or service agreement, if any) effective as of the date that you cease to actively provide services to the Company or any Affiliate and will not be extended by any notice period (e.g., employment or service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment or other laws in the jurisdiction where you are employed or providing services or the terms of your employment or service agreement, if any). Determination as to when you are no longer actively employed or otherwise providing Continuous Service for purposes of the Plan (including whether you still may be considered to be providing services while on a leave of absence) shall be determined as set forth in the Plan.

3.Number of Shares. The number of Restricted Stock Units/shares subject to your Award may be adjusted from time to time for Capitalization Adjustments, as provided in the Plan. Any additional Restricted Stock Units, shares, cash or other property that become subject to the Award pursuant to this Section 3, if any, will be subject, in a manner determined by the Board, to the same forfeiture restrictions, restrictions on transferability, and time and manner of delivery as applicable to the other Restricted Stock Units and shares covered by your Award. Notwithstanding the provisions of this Section 3, no fractional shares or rights for fractional shares of Common Stock will be created pursuant to this Section 3. Any fraction of a share will be rounded down to the nearest whole share.

4.Compliance. You may not be issued any Common Stock under your Award unless the shares of Common Stock underlying the Restricted Stock Units are either (i) then registered under the Securities Act or (ii) the Company has determined that such issuance would be exempt from the registration requirements of the Securities Act. Your Award must also comply with other applicable laws and regulations governing the Award, including any U.S. and non-U.S. state, federal and local laws, and you will not receive such Common Stock if the Company determines that such receipt would not be in material compliance with such laws and regulations.

5.Transfer Restrictions. Prior to the time that shares of Common Stock have been delivered to you, you may not transfer, pledge, sell or otherwise dispose of this Award or the shares issuable in respect of your Award, except as expressly provided in this Section 5. For example, you may not use shares that may be issued in respect of your Restricted Stock Units as security for a loan. The restrictions on transfer set forth herein will lapse upon delivery to you of shares in respect of your vested Restricted Stock Units. Notwithstanding the foregoing, if permitted by the Company and valid under applicable law, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, will thereafter be entitled to receive any distribution of Common Stock to which you were entitled at the time of your death pursuant to this Award Agreement. In the absence of such a designation or if such designation is not valid under applicable law, your legal representative will be entitled to receive, on behalf of your estate, such Common Stock or other consideration.

(a)Death. Your Award is transferable by will and by the laws of descent and distribution. At your death, vesting of your Award will cease and your executor or administrator of your estate will be entitled to receive, on behalf of your estate, any Common Stock or other consideration that vested but was not issued before your death.

(b)Domestic Relations Orders. Upon receiving written permission from the Board or its duly authorized designee, and provided that you and the designated transferee enter into transfer and other agreements required by the Company, you may transfer your right to receive the distribution of Common Stock or other consideration hereunder, pursuant to a domestic relations order, official marital settlement agreement or other divorce or separation instrument that contains the information required by the Company to effectuate the transfer. You are encouraged to discuss the proposed terms of any division of this Award with the Company General Counsel prior to finalizing the domestic relations order or marital settlement agreement to verify that you may make such transfer, and if so, to help ensure the required information is contained within the domestic relations order or marital settlement agreement.

6.Date of Issuance.

(a)The issuance of shares in respect of the Restricted Stock Units is intended to comply with Treasury Regulations Section 1.409A-1(b)(4) and will be construed and administered in such a manner. Subject to the satisfaction any withholding obligation for Tax-Related Items (as defined in Section 10 below), in the event one or more Restricted Stock Units vests, the Company will issue to you one (1) share of Common Stock for each Restricted Stock Unit that vests on the applicable vesting date(s) (subject to any adjustment under Section 3 above, and subject to any different provisions in the Grant Notice). The issuance date determined by this paragraph is referred to as the “Original Issuance Date”.

(b)If the Original Issuance Date falls on a date that is not a business day, delivery will instead occur on the next following business day. In addition, if:

(i)the Original Issuance Date does not occur (1) during an “open window period” applicable to you, as determined by the Company in accordance with the Company’s then-effective policy on trading in Company securities, or (2) on a date when you are otherwise permitted to sell shares of Common Stock on an established stock exchange or stock market (including but not limited to under a previously established written trading plan that meets the requirements of Rule 10b5-1 under the Exchange Act and was entered into in compliance with the Company’s policies (a “10b5-1 Plan”)), and

(ii)either (1) withholding obligations for Tax-Related Items (as defined in Section 10 below) do not apply, or (2) the Company decides, prior to the Original Issuance Date, (A) not to satisfy the withholding obligation for Tax-Related Items (as defined in Section 10 below) by withholding shares of Common Stock from the shares otherwise due, on the Original Issuance Date, to you under this Award, and (B) not to permit you to enter into a “same day sale” commitment with a broker-dealer pursuant to Section 10 of this Award Agreement (including but not limited to a commitment under a 10b5-1 Plan) and (C) not to permit you to pay the Tax-Related Items in cash or from other compensation otherwise payable to you by the Company (as defined in Section 10 below), then the shares that would otherwise be issued to you on the Original Issuance Date will not be delivered on such Original Issuance Date and will instead be delivered on the first business day when you are not prohibited from selling shares of the Company’s Common Stock in the open public market, but in no event later than December 31 of the calendar year in which the Original Issuance Date occurs (that is, the last day of your taxable year in which the Original Issuance Date occurs), or, if and only if permitted in a manner that complies with Treasury Regulations Section 1.409A-1(b)(4), no later than the date that is the 15th day of the third calendar month of the applicable year following the year in which the shares of Common Stock under this Award are no longer subject to a “substantial risk of forfeiture” within the meaning of Treasury Regulations Section 1.409A-1(d).

(c)The form of delivery of the shares of Common Stock in respect of your Award (e.g., a stock certificate or electronic entry evidencing such shares) will be determined by the Company.

7.Dividends. You will receive no benefit or adjustment to your Award with respect to any cash dividend, stock dividend or other distribution that does not result from a Capitalization Adjustment; provided, however, that this sentence will not apply with respect to any shares of Common Stock that are delivered to you in connection with your Award after such shares have been delivered to you.

8.Restrictive Legends. The shares of Common Stock issued under your Award will be endorsed with appropriate legends as determined by the Company.

9.Execution of Documents. You hereby acknowledge and agree that the manner selected by the Company by which you indicate your consent to your Grant Notice is also deemed to be your execution of your Grant Notice and of this Award Agreement. You further agree that such manner of indicating consent may be relied upon as your signature for establishing your execution of any documents to be executed in the future in connection with your Award.

10.Responsibility for Taxes.

(a)You acknowledge that, regardless of any action the Company or, if different, your employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, fringe benefit tax, payment on account or other tax related items related to your participation in the Plan and legally applicable to you (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains your responsibility and may exceed the amount actually withheld by the Company or the Employer, if any. You further acknowledge that the Company and the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of your Restricted Stock Units, including, but not limited to, the grant of the Restricted Stock Units, the vesting and settlement of the Restricted Stock Units, the delivery or sale of any shares of Common Stock and the issuance of any dividends, and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of your Award to reduce or eliminate your liability for Tax-Related Items or achieve any particular tax result. You acknowledge and agree that you will not make any claim against the Company, or any of its Officers, Directors, Employees or Affiliates for Tax-Related Items arising from your Award. Further, if you are subject to Tax-Related Items in more than one jurisdiction, you acknowledge that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

(b)Prior to the relevant taxable or tax withholding event, as applicable, you agree to make adequate arrangements satisfactorily to the Company and/or the Employer to satisfy all Tax-Related Items. In this regard, you authorize the Company and/or the Employer, or their respective agents, at their discretion, to satisfy their withholding obligations with regard to all Tax-Related Items by: (i) withholding from your wages or any other cash compensation otherwise payable to you by the Company and/or the Employer; (ii) causing you to tender a cash payment; (iii) permitting or requiring you to enter into a “same day sale” commitment, if applicable, with a broker-dealer that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) (pursuant to this authorization and without further consent) whereby you irrevocably elect to sell a portion of the shares to be delivered in connection with your Restricted Stock Units to satisfy the Tax-Related Items and whereby the FINRA Dealer irrevocably commits to forward the proceeds necessary to satisfy the Tax-Related Items directly to the Company and its Affiliates; or (iv) withholding shares of Common Stock from the shares of Common Stock issued or otherwise issuable to you in connection with the Award with a Fair Market Value (measured as of the date shares of Common Stock are issued to you pursuant to Section 6) equal to the amount of such Tax-Related Items; provided, however that if you are an Officer, then the Company will withhold a number of shares of Common Stock upon the relevant taxable or tax withholding event, as applicable, unless the use of such withholding method is not feasible under applicable law or has materially adverse accounting consequences, in which case, the obligation for Tax-Related Items may be satisfied by one or a combination of methods (i)-(iii) above. The Company or the Employer may withhold or account for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum rates applicable in your jurisdiction(s), in which case you may receive a refund of any over-withheld amount in cash and will have no entitlement to the Common Stock equivalent. If the obligation for Tax-Related Items is satisfied by withholding in a number of shares of Common Stock, for tax purposes, you will be deemed to have been issued the full number of shares of Common Stock subject to the vested Restricted Stock Units, notwithstanding that a number of the shares of Common Stock is held back solely for the purpose of paying the Tax-Related Items. However, the Company does not guarantee that you will be able to satisfy the Tax-Related Items through any of the methods described in the preceding provisions and in all circumstances you remain responsible for timely and fully satisfying the Tax-Related Items.

(c)Unless the Tax-Related Items of the Company and any Affiliate are satisfied, the Company will have no obligation to deliver to you any Common Stock or other consideration pursuant to this Award.

(d)In the event the Company’s obligation to withhold arises prior to the delivery to you of Common Stock or it is determined after the delivery of Common Stock to you that the amount of the Company’s withholding obligation was greater than the amount withheld by the Company, you agree to indemnify and hold the Company harmless from any failure by the Company to withhold the proper amount.

11.Award not a Service Contract.

(a)Your Continuous Service with the Company, the Employer or any other Affiliate is not for any specified term and may be terminated by you or by the Company, the Employer or any other Affiliate at any time, for any reason, with or without cause and, if permitted under applicable law, with or without notice. Nothing in this Award Agreement (including, but not limited to, the vesting of your Award or the issuance of the shares subject to your Award), the Plan or any covenant of good faith and fair dealing that may be found implicit in this Award Agreement or the Plan will: (i) confer upon you any right to continue in the employ of, or affiliation with the Employer; (ii) constitute any promise or commitment by the Company, the Employer or any other Affiliate regarding the fact or nature of future positions, future work assignments, future compensation or any other term or condition of employment or affiliation; (iii) confer any right or benefit under this Award Agreement or the Plan unless such right or benefit has specifically accrued under the terms of this Award Agreement or Plan; or (iv) deprive the Company or the Employer of the right to terminate you at any time and without regard to any future vesting opportunity that you may have. Finally, the grant of the Award shall not be interpreted as forming an employment or service contract with the Company.

(b)By accepting this Award, you acknowledge and agree that the right to continue vesting in the Award is earned only by continuing as an Employee, Director or Consultant at the will of the Company, the Employer or any other Affiliate and that the Company has the right to reorganize, sell, spin-out or otherwise restructure one or more of its businesses or Affiliates at any time or from time to time, as it deems appropriate (a “reorganization”). You further acknowledge and agree that such a reorganization could result in the termination of your Continuous Service, or the termination of Affiliate status of the Employer and the loss of benefits available to you under this Award Agreement, including but not limited to, the termination of the right to continue vesting in the Award. You further acknowledge and agree that this Award Agreement, the Plan, the transactions contemplated hereunder and the vesting schedule set forth herein or any covenant of good faith and fair dealing that may be found implicit in any of them do not constitute an express or implied promise of continued engagement as an employee or consultant for the term of this Award Agreement, for any period, or at all, and will not interfere in any way with your right or the right of the Company, the Employer or any other Affiliate to terminate your Continuous Service at any time, with or without cause and, if permitted under applicable law, with or without notice, and will not interfere in any way with the Company’s right to conduct a reorganization.

12. Nature of Grant. In accepting your Award, you acknowledge, understand and agree that:

(a)the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, to the extent permitted under the Plan;

(b)the Award is exceptional, voluntary and occasional and does not create any contractual or other right to receive future Awards (whether on the same or different terms), or benefits in lieu of an Award, even if an Award has been granted in the past;

(c)all decisions with respect to future awards of Restricted Stock Units or other grants, if any, will be at the sole discretion of the Company;

(d)you are voluntarily participating in the Plan;

(e)the future value of the shares of Common Stock underlying the Award is unknown, indeterminable and cannot be predicted with certainty;

(f)no claim or entitlement to compensation or damages shall arise from forfeiture of the Award resulting from the termination of your Continuous Service (for any reason whatsoever whether or not later found to be invalid or in breach of employment laws in the jurisdiction where you are employed or rendering services or the terms of your employment agreement, if any);

(g)unless otherwise provided herein, in the Plan or by the Company in its discretion, the Award and the benefits evidenced by this Award Agreement do not create any entitlement to have the Award or any such benefits transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the shares of Common Stock;

(h)the Award and the shares of Common Stock subject to the Award, and the income from and value of same, are not part of normal or expected compensation for purposes of, including, without limitation, calculating any severance, resignation, termination, redundancy, dismissal, end-of-service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

(i)unless otherwise agreed with the Company, the Award and the shares of Common Stock subject to the Award, and the income from and value of same, are not granted as consideration for, or in connection with, the service you may provide as a director of an Affiliate; and

(j)The following provisions apply only if you are employed or rendering services outside the United States:

(i)the Award and the shares of Common Stock subject to the Award, and the income from and value of same, are not part of normal or expected compensation for any purpose; and

(ii)neither the Company, the Employer nor any other Affiliate shall be liable for any foreign exchange rate fluctuation between your local currency and the United States Dollar that may affect the value of the Award or of any amounts due to you pursuant to the vesting of the Award or the subsequent sale of any shares of Common Stock acquired upon vesting.

13.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying shares of Common Stock. You should consult with your own personal tax, financial and/or legal advisors regarding your participation in the Plan before taking any action related to the Plan.

14.Data Privacy.

(a)As set out in the Roku Privacy Notice for Employees and Contingent Workers (for European employees) and as per standard Human Resources practices in the United States, the Company and the Employer process certain personal information about you for a number of purposes in connection with your employment, including the implementing, administering and managing of the Plan. The personal information that we process in connection with the Plan typically includes your name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number, salary, nationality, job title, any shares of Common Stock or directorships held in the Company, details of all Restricted Stock Units or any other entitlement to shares of Common Stock or equivalent benefits awarded, canceled, exercised, vested, unvested or outstanding in your favor (“Data”). The Company will process the Data only as long as is necessary to implement, administer and manage your participation in the Plan, or as required to comply with legal or regulatory obligations, including under tax, exchange control, labor and securities laws.

Stock Plan Administration Service Providers. The Company will disclose Data to E*TRADE Financial Corporate Services, Inc. (including its affiliated companies) (collectively, the “Designated Broker”), which is assisting the Company with the implementation, administration and management of the Plan. The Company may select different or additional service providers in the future and share Data with such other provider(s) serving in a similar manner. The Designated Broker may require you to enter into additional terms or provide you with additional notice about their handling of your personal information, or both. For more information about the Designated Broker's data privacy practices https://us.etrade.com/l/f/privacy-statement.

(b)For more information about the Company and Employer's processing of your personal information, including information about your rights over the Data, please refer to the Roku Privacy Notice for Employees and Contingent Workers (for European employees) or Roku Human Resources in the United States.

15.Unsecured Obligation. Your Award is unfunded, and as a holder of a vested Award, you will be considered an unsecured creditor of the Company with respect to the Company’s obligation, if any, to issue shares or other property pursuant to this Award Agreement. You will not have voting or any other rights as a stockholder of the Company with respect to the shares to be issued pursuant to this Award Agreement until such shares are issued to you pursuant to Section 6 of this Award Agreement. Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company. Nothing contained in this Award Agreement, and no action taken pursuant to its provisions, will create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.

16.Notices. Any notice or request required or permitted hereunder will be given in writing to each of the other parties hereto and will be deemed effectively given on the earlier of (i) the date of personal delivery, (ii) delivery via electronic means, or (ii) for deliveries within the U.S., the date that is five (5) days after deposit in the United States Post Office (whether or not actually received by the addressee), by registered or certified mail with postage and fees prepaid, addressed to the Company at its primary executive offices, attention: Stock Plan Administrator, and addressed to you at your address as on file with the Company at the time notice is given, (iv) for deliveries outside the United States, the date that is seven (7) days after deposit with the applicable jurisdiction’s official mail service, with postage and fees prepaid, or (v) the date that is one (1) day after deposit with a reputable overnight courier, with shipping charges prepaid.

17.Headings. The headings of the Sections in this Award Agreement are inserted for convenience only and will not be deemed to constitute a part of this Award Agreement or to affect the meaning of this Award Agreement.

18.Governing Plan Document. Your Award is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your Award, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan. Your Award (and any compensation paid or shares issued under your Award) is subject to recoupment in accordance with The U.S. Dodd–Frank Wall Street Reform and Consumer Protection Act and any implementing regulations thereunder, any clawback policy adopted by the Company and any compensation recovery policy otherwise required by applicable law. No recovery of compensation under such a clawback policy will be an event giving rise to a right to voluntarily terminate employment upon a resignation for “good reason,” or for a “constructive termination” or any similar term under any plan of or agreement with the Company.

19.Other Documents. You hereby acknowledge receipt of and the right to receive a document providing the information required by Rule 428(b)(1) promulgated under the Securities Act, which includes the Plan prospectus. In addition, you acknowledge receipt of the Company’s policy permitting certain individuals to sell shares only during certain “window” periods and the Company’s insider trading policy, in effect from time to time.

20.Severability. If all or any part of this Award Agreement or the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity will not invalidate any portion of this Award Agreement or the Plan not declared to be unlawful or invalid. Any Section of this Award Agreement (or part of such a Section) so declared to be unlawful or invalid will, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.

21.Language. If you have received this Award Agreement, or any other document related to this Award and/or the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control. You acknowledge that you are sufficiently proficient in English, or have consulted with an advisor who is sufficiently proficient in English, so as to allow you to understand the terms and conditions of this Award Agreement.

22.Insider Trading Restrictions/Market Abuse Laws. You may be subject to insider trading restrictions and/or market abuse laws based on the exchange on which the shares of Common Stock are listed and in applicable jurisdictions, including the United States and your country or your broker’s country, if different, which may affect your ability to accept, acquire, sell or otherwise dispose of shares of Common Stock, rights to shares of Common Stock (e.g., Restricted Stock Units) or rights linked to the value of shares of Common Stock during such times as you are considered to have “inside information” regarding the Company (as defined by the laws in applicable jurisdictions). Local insider trading laws and regulations may prohibit the cancellation or amendment of orders you placed before you possessed inside information. Furthermore, you could be prohibited from (i) disclosing the inside information to any third party, which may include fellow employees, and (ii) “tipping” third parties or causing them otherwise to buy or sell securities. Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable insider trading policy of the Company. You acknowledge that it is your responsibility to comply with any applicable restrictions and you should speak with your personal legal advisor on this matter.

23.Foreign Asset/Account and Tax Reporting, Exchange Controls. Your country may have certain foreign asset, account and/or tax reporting requirements and exchange controls which may affect your ability to acquire or hold shares of Common Stock under the Plan or cash received from participating in the Plan (including from any dividends received or sale proceeds arising from the sale of shares of Common Stock) in a brokerage or bank account outside your country. You understand that you may be required to report such accounts, assets or transactions to the tax or other authorities in your country. You also may be required to repatriate sale proceeds or other funds received as a result of participation in the Plan to your country through a designated bank or broker and/or within a certain time after receipt. In addition, you may be subject to tax payment and/or reporting obligations in connection with any income realized under the Plan and/or from the sale of shares of Common Stock. You acknowledge that you are responsible for complying with all such requirements, and that you should consult personal legal and tax advisors, as applicable, to ensure compliance.

24.Appendix. Notwithstanding any provisions in this Award Agreement, your Award shall be subject to the special terms and conditions for your country set forth in the Appendix attached hereto as Exhibit A. Moreover, if you relocate to one of the countries included therein, the terms and conditions for such country will apply to you to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. The Appendix constitutes part of this Award Agreement.

25.Imposition of Other Requirements. The Company reserves the right to impose other requirements on your participation in the Plan, and on any shares of Common Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

26.Governing Law/Venue. The interpretation, performance and enforcement of this Award Agreement will be governed by the law of the State of Delaware without regard to that state’s conflicts of laws rules. For purposes of any action, lawsuit or other proceedings brought to enforce this Award Agreement, including its Exhibit, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive jurisdiction of the courts within Santa Clara County, State of California, and no other courts, where this grant is made and/or to be performed.

27.Miscellaneous.:

(a)The rights and obligations of the Company under your Award will be transferable by the Company to any one or more persons or entities, and all covenants and agreements hereunder will inure to the benefit of, and be enforceable by, the Company’s successors and assigns.

(b)You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

(c)You acknowledge and agree that you have reviewed your Award in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully understand all provisions of your Award.

(d)All obligations of the Company under the Plan and this Award Agreement will be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and assets of the Company.

28.Amendment. This Award Agreement may not be modified, amended or terminated except by an instrument in writing, signed by you and by a duly authorized representative of the Company. Notwithstanding the foregoing, this Award Agreement may be amended solely by the Board by a writing which specifically states that it is amending this Award Agreement, so long as a copy of such amendment is delivered to you, and provided that, except as otherwise expressly provided in the Plan, no such amendment materially adversely affecting your rights hereunder may be made without your written consent. Without limiting the foregoing, the Board reserves the right to change, by written notice to you, the provisions of this Award Agreement in any way it may deem necessary or advisable to carry out the purpose of the Award as a result of any change in applicable laws or regulations or any future law, regulation, ruling, or judicial decision, provided that any such change will be applicable only to rights relating to that portion of the Award which is then subject to restrictions as provided herein.

29.Compliance with Section 409A of the Code. This Award is intended to comply with the “short-term deferral” rule set forth in Treasury Regulation Section 1.409A-1(b)(4). Notwithstanding the foregoing, if it is determined that the Award fails to satisfy the requirements of the short-term deferral rule and is otherwise deferred compensation subject to Section 409A, and if you are a “Specified Employee” (within the meaning set forth in Section 409A(a)(2)(B)(i) of the Code) as of the date of your “separation from service” (within the meaning of Treasury Regulation Section 1.409A-1(h) and without regard to any alternative definition thereunder), then the issuance of any shares that would otherwise be made upon the date of the separation from service or within the first six (6) months thereafter will not be made on the originally scheduled date(s) and will instead be issued in a lump sum on the earlier of: (i) the fifth business day following your death, or (ii) the date that is six (6) months and one day after the date of the separation from service, with the balance of the shares issued thereafter in accordance with the original vesting and issuance schedule set forth above, but if and only if such delay in the issuance of the shares is necessary to avoid the imposition of adverse taxation on you in respect of the shares under Section 409A of the Code. Each installment of shares that vests is intended to constitute a “separate payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2).

* * * * *

This Award Agreement will be deemed to be signed by the Company and you upon your signing or otherwise by your acceptance of the Restricted Stock Unit Grant Notice to which it is attached.

Exhibit A

Appendix to Restricted Stock Unit Award Agreement

Special Terms and Conditions for Employees outside the United States

Capitalized terms used but not defined in this Appendix have the meanings set forth in the Plan and/or in the Restricted Stock Unit Award Agreement.

Terms and Conditions

This Appendix includes special terms and conditions that govern the Restricted Stock Units granted to you under the Plan if you reside and/or work in one of the countries listed below. If you are a citizen or resident (or are considered as such for local law purposes) of a country other than the country in which you are currently residing and/or working, or if you relocate to another country after the grant of the Restricted Stock Units, the Company shall, in its discretion, determine to what extent the special terms and conditions contained herein shall be applicable to you.

Notifications

This Appendix may also include information regarding exchange controls and certain other issues of which you should be aware with respect to participation in the Plan. The information is based on the securities, exchange control, and other laws in effect in the respective countries as of April 2019. Such laws are often complex and change frequently. As a result, the Company strongly recommends that you not rely on the information in this Appendix as the only source of information relating to the consequences of your participation in the Plan because the information may be out of date at the time the Restricted Stock Units vest or you sell shares of Common Stock acquired under the Plan.

In addition, the information contained herein is general in nature and may not apply to your particular situation, and the Company is not in a position to assure you of a particular result. Accordingly, you are advised to seek appropriate professional advice as to how the relevant laws in your country may apply to your situation.

Finally, if you are a citizen or resident (or are considered as such for local law purposes) of a country other than the country in which you are currently residing and/or working, or if you relocate to another country after the grant of the Restricted Stock Units, the notifications contained herein may not be applicable to you in the same manner.

China

Terms and Conditions

The following provisions assume you are not subject to exchange control regulations in the People’s Republic of China (“China”), including the requirements imposed by the State Administration of Foreign Exchange (“SAFE”), as determined by the Company in its sole discretion: If you are subject to exchange control regulations in China, the Company has the right to cancel the Award because settlement of the Award would not be in compliance with applicable regulations in China.

Notifications

Exchange Control Information. Chinese residents must report to SAFE all details of foreign financial assets and liabilities, as well as details of any economic transactions conducted with non-Chinese residents, either directly or through financial institutions.

Denmark

Terms and Conditions

Danish Stock Option Act. By accepting this Award, you acknowledge that you received an Employer Statement, translated into Danish, which is being provided to comply with the Danish Stock Option Act.

Please note the Danish Stock Option Act has been revised as of January 1, 2019. The termination provisions under the Plan will apply for any grants made after January 1, 2019. The relevant termination provisions are detailed in Section 2 of the Agreement and the Employer Statement.

Notifications

Securities/Tax Reporting Information. The new Danish Tax Reporting Act that entered into force on January 1, 2019 removed the rules that previously obligated you to inform the Danish Tax Administration about shares of Common Stock held in foreign bank or brokerage accounts and deposit accounts with a foreign bank or broker. The use of the relevant Forms V and K are discontinued as of January 1, 2019 and replaced by automatic exchange of information regarding bank and brokerage accounts.

Foreign Asset/Account Reporting Information. If you establish an account holding shares or cash outside of Denmark, you must report the account to the Danish Tax Administration. The form which should be used to make the report can be obtained from a local bank.

SPECIAL NOTICE FOR EMPLOYEES IN DENMARK

EMPLOYER STATEMENT

Pursuant to Section 3(1) of the Act on Stock Options in employment relations, as amended 1 January 2019 (the “Stock Option Act”), you are entitled to receive the following information regarding the restricted stock units granted to you by Roku, Inc. (the “Company”) under the Roku, Inc. 2017 Equity Incentive Plan (the “Plan”) in a written statement.

This statement contains information applicable to your participation in the Plan, as required under the Stock Option Act, while the other terms and conditions of your restricted stock units (“Restricted Stock Units”) are described in detail in the Plan and the Restricted Stock Unit Award Agreement (the “Agreement”), both of which have been made available to you. Capitalized terms used but not defined herein shall have the same meanings given to them in the Plan or the Agreement, as applicable.

Section 1 of the Stock Option Act provides that the Stock Option Act only applies to employees. Employees are defined in section 16 of the Stock Option Act as persons who receive remuneration for their personal services in an employment relationship. Persons, including managers, who are not regarded as employees under the Stock Option Act, will not be subject to the Stock Option Act. If you are not an employee within the meaning of the Stock Option Act, the Company therefore has no obligation to issue an employer information statement to you and you will not be able to rely on this statement for legal purposes, since only the terms and conditions set out in the Plan apply.

1.	Date of grant

The date of grant of your Restricted Stock Units is the date that the Board or Committee approved a grant for you and determined it would be effective, which is set forth in the Agreement.

2.	Terms or conditions for Restricted Stock Unit grant

The grant of Restricted Stock Units under the Plan is made at the sole discretion of the Company. Employees, Directors and Consultants of the Company and its Affiliates, are eligible to receive grants under the Plan. The Board has broad discretion to determine who will receive Restricted Stock Units and to set the terms and conditions of the Restricted Stock Units. The Company may decide, in its sole discretion, not to make any grants of Restricted Stock Units to you in the future. Under the terms of the Plan and the Agreement, you have no entitlement or claim to receive future grants of Restricted Stock Units.

3.	Vesting date or period

The Restricted Stock Units will vest over a period of time (as set forth in the Agreement), subject to your Continuous Service through the applicable vesting date and other conditions set forth in the Plan and Agreement.

4.	Exercise Price

No exercise price is payable upon the conversion of your Restricted Stock Units into shares in accordance with the vesting and settlement schedule described in the Agreement.

5.	Your rights upon termination of employment

Vesting will cease upon termination of your Continuous Service and the Restricted Stock Units credited to the Account that were not vested on the date of such termination will be forfeited at no cost to the Company and you will have no further right, title or interest in or to such Award or the shares of Common Stock to be issued in respect of such portion of the Award.

6.	Financial aspects of participating in the Plan

The grant of Restricted Stock Units has no immediate financial consequences for you. The value of the Restricted Stock Units is not taken into account when calculating holiday allowances, pension contributions or other statutory consideration calculated on the basis of salary.

Shares of stock are financial instruments and investing in stock will always have financial risk. The future value of Company shares is unknown and cannot be predicted with certainty.

Roku, Inc.

150 Winchester Circle

Los Gatos, CA 95032

U.S.A.

SÆRLIG MEDDELELSE TIL MEDARBEJDERE I DANMARK

ARBEJDSGIVERERKLÆRING

I henhold til § 3, stk. 1, i lov om brug af køberet eller tegningsret mv. i ansættelsesforhold, som ændret 1. januar 2019, ("Aktieoptionsloven") er du berettiget til i en skriftlig erklæring at modtage følgende oplysninger om de betingede aktie (på engelsk: Restricted Stock Units), som du tildeles af Roku, Inc. (”Selskabet”) i henhold til Roku, Inc.'s 2017 Equity Incentive Plan (”Planen”).

Denne erklæring indeholder, i henhold til Aktieoptionsloven, de oplysninger, der er gældende for din deltagelse i Planen, mens de øvrige kriterier og betingelser for dine betingede aktie ("Betingede Aktier") er beskrevet nærmere i Planen og i Restricted Stock Unit Award Agreement ("Aftalen"), som begge er stillet til rådighed for dig. Begreber, der står med stort begyndelsesbogstav i denne arbejdsgivererklæring, men som ikke er defineret heri, har den betydning, der er defineret i Planen, hhv. Aftalen.

I henhold til Aktieoptionslovens § 1 finder loven kun anvendelse for lønmodtagere. Lønmodtagere er defineret i Aktieoptionslovens § 16 som personer, der modtager vederlag for personligt arbejde i tjenesteforhold.

Personer, herunder direktører, som ikke anses for at være lønmodtagere i Aktieoptionslovens forstand, er ikke omfattet af Aktieoptionsloven. Hvis du ikke er lønmodtager i Aktieoptionslovens forstand, er Selskabet derfor ikke forpligtet til at udstede en arbejdsgivererklæring til dig, og du vil ikke i juridisk henseende kunne henholde dig til denne arbejdsgivererklæring, da alene Planens vilkår er gældende.

1.	Tildelingstidspunkt

Tidspunktet for tildelingen af dine Betingede Aktier er den dag, hvor Bestyrelsen eller Komitéen godkendte din tildeling og besluttede, at den skulle træde i kraft. Tidspunktet fremgår af Aftalen.

2.	Vilkår og betingelser for tildelingen af Betingede Aktier

Betingede Aktier, der er omfattet af Planen, tildeles udelukkende efter Selskabets skøn. Tildeling kan i henhold til Planen ske til Medarbejdere, Bestyrelsesmedlemmer og Konsulenter i Selskabet og dets Tilknyttede Selskaber. Bestyrelsen har vide beføjelser til at bestemme, hvem der skal modtage Betingede Aktier og til at fastsætte betingelserne for de Betingede Aktier. Selskabet kan frit vælge fremover ikke at tildele dig Betingede Aktier. I henhold til bestemmelserne i Planen og Aftalen har du hverken ret til eller krav på fremover at få tildelt Betingede Aktier.

3.	Modningstidspunkt eller -periode

De Betingede Aktier modnes over en periode (som anført i Aftalen), forudsat at du på det relevante modningstidspunkt opfylder betingelsen om Fortsat Ansættelse og de øvrige betingelser i Planen og i Aftalen.

4.	Udnyttelseskurs

Ingen udnyttelsespris skal betales ved din omdannelse af dine Betingede Aktier til Aktier i Selskabet i overensstemmelse med modnings- og udnyttelsesplanen beskrevet i Aftalen.

5.	Din retsstilling i forbindelse med fratræden

Ophører modning ved ophør af din Fortsatte Ansættelse, og Betingede Aktier krediteret Kontoen, som på tidspunktet for ophøret ikke er modnet, bortfalder uden omkostninger for Selskabet, og du vil ikke længere have nogen ejerrettigheder eller rettigheder i øvrigt i forhold til den pågældende Tildeling eller de Aktier, der ellers ville have skullet udstedes på grundlag af den pågældende del af Tildelingen.

6.	Økonomiske aspekter ved deltagelse i Planen

Tildelingen af Betingede Aktier har ingen umiddelbare økonomiske konsekvenser for dig. Værdien af de Betingede Aktier indgår ikke i beregningen af feriepenge, pensionsbidrag eller øvrige lovbestemte, vederlagsafhængige ydelser.

Aktier er finansielle instrumenter, og investering i aktier vil altid være forbundet med en økonomisk risiko. Den fremtidige værdi af Selskabets aktier kendes ikke og kan ikke forudsiges med sikkerhed.

Roku, Inc.

150 Winchester Circle

Los Gatos, CA 95032

U.S.A.

Germany

Notifications

Exchange Control Information. Cross-border payments in excess of €12,500 must be reported monthly to the German Federal Bank (Bundesbank). In case of payments in connection with securities (including proceeds realized upon the sale of shares of Common Stock or the receipt of dividends), the report must be made by the 5th day of the month following the month in which the payment was received. The report must be filed electronically and the form of report (“Allgemeine Meldeportal Statistik”) can be accessed via the Bundesbank’s website (www.bundesbank.de), in both German and English. You are responsible for making this report.

Foreign Asset/Account Reporting Information. German residents holding shares of Common Stock must notify their local tax office of the acquisition of shares of Common Stock when they file their tax returns for the relevant year if the value of the shares of Common Stock acquired exceeds €150,000 or in the unlikely event that the resident holds Common Stock exceeding 10% of the Company’s total Common Stock outstanding.

Netherlands

There are no country-specific terms.

United Kingdom

Restricted Stock Units Settled Only in Shares

Notwithstanding any discretion in Section 6(b)(iii) of the Plan or Section 1 of the Agreement, Restricted Stock Units shall be settled in shares only.

Responsibility for Taxes. The following supplements Section 10 of the Award Agreement:

Without limitation to Section 10 of the Award Agreement, you agree that you are liable for all Tax-Related Items and hereby covenant to pay all such Tax-Related Items, as and when requested by the Company or the Employer or by Her Majesty’s Revenue and Customs (“HMRC”) (or any other tax authority or any other relevant authority). You also agree to indemnify and keep indemnified the Company and the Employer against any Tax-Related Items that they are required to pay or withhold or have paid or will pay to HMRC on your behalf (or any other tax authority or any other relevant authority).

Notwithstanding the foregoing, if you are a director or an executive officer of the Company (within the meaning of such terms for purposes of Section 13(k) of the Exchange Act), you acknowledge that you may not be able to indemnify the Company or the Employer for the amount of any income tax not collected from or paid by you, as it may be considered a loan. In this case, the amount of any income tax not collected within ninety (90) days of the end of the U.K. tax year in which the event giving rise to the Tax-Related Item(s) occurs may constitute an additional benefit to you on which additional income tax and National Insurance contributions may be payable. You will be responsible for reporting and paying any income tax due on this additional benefit directly to HMRC under the self-assessment regime and for reimbursing the Company or the Employer (as appropriate) for the value of any National Insurance contributions due on this additional benefit, which the Company or the Employer may recover from you by any of the means referred to in the Plan or Section 10 of the Award Agreement.

Joint Election. As a condition of participation in the Plan, you agree to accept any liability for secondary Class 1 National Insurance contributions that may be payable by the Company or the Employer (or any successor to the Company or the Employer) in connection with the Restricted Stock Units and any event giving rise to Tax-Related Items (the “Employer NICs”). The Employer NICs may be collected by the Company or the Employer using any of the methods described in the Plan or in Section 10 of the Restricted Stock Unit Award Agreement.

Without prejudice to the foregoing, you agree to execute a joint election with the Company and/or the Employer (a “Joint Election”), the form of such Joint Election being formally approved by HMRC, and any other consent or elections required by the Company or the Employer in respect of the Employer NICs liability. You further agree to execute such other elections as may be required by any successor to the Company and/or the Employer for the purpose of continuing the effectiveness of your Joint Election.

ROKU, INC.

2017 EQUITY INCENTIVE PLAN

Onscreen disclaimer

As a condition of participation in the Roku, Inc. 2017 Equity Incentive Plan (the “Plan”), Participant is required to enter into an Election to transfer to Participant any liability for employer’s National Insurance contributions (“NICs”) that may arise in connection with his or her participation in the Plan.

Clicking on the [“ACCEPT”] box indicates Participant’s acceptance of the Election. Participant should read the “Important Note on the Election to Transfer Employer NICs” before accepting the Election.

Important Note on the Election to Transfer Employer NICs

By entering into the Election:

•

Participant agrees that any employer’s NICs liability that may arise in connection with his or her participation in the Plan will be transferred to Participant;

•

Participant authorizes his or her employer to recover an amount sufficient to cover this liability by such methods including, but not limited to, deductions from Participant’s wages or other cash compensation due or the sale of sufficient shares of Common Stock acquired pursuant to Participant’s awards; and

•

Participant acknowledges that even if Participant has clicked on the [“ACCEPT”] box where indicated, the Company or Participant’s employer may still require Participant to sign a paper copy of this Election (or a substantially similar form) if the Company determines such is necessary to give effect to the Election.

Please read the Election carefully.

Participant Should Print and Keep a Copy of this Election for his or her Records.

ROKU, INC.

2017 EQUITY INCENTIVE PLAN

Election to Transfer the Employer’s National Insurance Liability to Participant

This Election is between:

The individual who has obtained authorized access to this Election (“Participant”), who is employed by the company listed in the attached schedule (the “Employer”) and who is eligible to receive restricted stock units (“Awards”) pursuant to the Roku, Inc. 2017 Equity Incentive Plan (the “Plan”), and

B.	Roku, Inc., with its registered office at 150 Winchester Circle, Los Gatos, CA 95032, United States (the “Company”), which may grant Awards under the Plan and is entering into this Election on behalf of the Employer.

1.	Introduction

1.1	This Election relates to all Awards granted to Participant under the Plan up to the termination date of the Plan.

1.2	In this Election the following words and phrases have the following meanings:

(a)

“Chargeable Event” means, in relation to the Awards:

(i)

the acquisition of securities pursuant to the Awards (within section 477(3)(a) of ITEPA 16003);

(ii)

the assignment (if applicable) or release of the Awards in return for consideration (within section 477(3)(b) of ITEPA 16003);

(iii)

the receipt of a benefit in connection with the Awards, other than a benefit within (i) or (ii) above (within section 477(3)(c) of ITEPA 16003);

(iv)

post-acquisition charges relating to the Awards and/or shares of Common Stock acquired pursuant to the Awards (within section 4167 of ITEPA 16003); and/or

(v)

post-acquisition charges relating to the Awards and/or shares of Common Stock acquired pursuant to the Awards (within section 439 of ITEPA 16003).

(b)

“ITEPA 16003” means the Income Tax (Earnings and Pensions) Act 16003.

(c)

“SSCBA” means the Social Security Contributions and Benefits Act 19916.

1.3	This Election relates to the employer’s secondary Class 1 National Insurance contributions (the “Employer’s Liability”) which may arise on the occurrence of a Chargeable Event in respect of the Awards pursuant to section 4(4)(a) and/or paragraph 3B(1A) of Schedule 1 of the SSCBA.

1.4	This Election does not apply in relation to any liability, or any part of any liability, arising as a result of regulations being given retrospective effect by virtue of section 4B(16) of either the SSCBA, or the Social Security Contributions and Benefits (Northern Ireland) Act 19916.

1.5	This Election does not apply to the extent that it relates to relevant employment income which is employment income of the earner by virtue of Chapter 3A of Part VII of ITEPA 16003 (employment income: securities with artificially depressed market value).

2.	The Election

Participant and the Company jointly elect that the entire liability of the Employer to pay the Employer’s Liability on the Chargeable Event is hereby transferred to Participant. Participant understands that, by signing or electronically accepting this Election, he or she will become personally liable for the Employer’s Liability covered by this Election. This Election is made in accordance with paragraph 3B(1) of Schedule 1 of the SSCBA.

3.	Payment of the Employer’s Liability

3.1	Participant hereby authorizes the Company and/or the Employer to collect the Employer’s Liability from Participant at any time after the Chargeable Event:

(i)

by deduction from salary or any other payment payable to Participant at any time on or after the date of the Chargeable Event; and/or

(ii)

directly from Participant by payment in cash or cleared funds; and/or

(iii)

by arranging, on behalf of Participant, for the sale of some of the securities which Participant is entitled to receive in respect of the Awards; and/or

(iv)

by any other means specified in the applicable award agreement.

3.2	The Company hereby reserves for itself and the Employer the right to withhold the transfer of any securities related to the Awards to Participant until full payment of the Employer’s Liability is received.

3.3

The Company agrees to procure the remittance by the Employer of the Employer’s Liability to Her Majesty’s Revenue & Customs on behalf of Participant within 14 days after the end of the U.K. tax month during which the Chargeable Event occurs (or within 17 days after the end of the U.K. tax month during which the Chargeable Event occurs if payments are made electronically).

4.	Duration of Election

4.1	Participant and the Company agree to be bound by the terms of this Election regardless of whether Participant is transferred abroad or is not employed by the Employer on the date on which the Employer’s Liability becomes due.

4.2

Any reference to the Company and/or the Employer shall include that entity’s successors in title and assigns as permitted in accordance with the terms of the Plan and relevant award agreement. This Election will continue in effect in respect of any awards which replace the Awards in circumstances where section 483 of ITEPA 16003 applies.

4.3	This Election will continue in effect until the earliest of the following:

(i)

Participant and the Company agree in writing that it should cease to have effect;

(ii)

on the date the Company serves written notice on Participant terminating its effect;

(iii)

on the date Her Majesty’s Revenue & Customs withdraws approval of this Election; or

(iv)

after due payment of the Employer’s Liability in respect of the entirety of the Awards to which this Election relates or could relate, such that the Election ceases to have effect in accordance with its terms.

4.4	This Election will continue in force regardless of whether Participant ceases to be an employee of the Employer.

[Signature page follows]

Acceptance by Participant

Participant acknowledges that, by clicking on the “ACCEPT” box, Participant agrees to be bound by the terms of this Election.

Acceptance by the Company

The Company acknowledges that, by signing this Election or arranging for the scanned signature of an authorized representative to appear on this Election, the Company agrees to be bound by the terms of this Election.

Signature for and on behalf of the Company

Position

Schedule of Employer Companies

The employer companies to which this Election relates are:


Name	Roku Europe Limited
Registered Office:	11th Floor, Whitefriars Lewins Mead, Bristol, BS1 16NT, UK
Company Registration Number:	091633680
Corporation Tax Reference:	6163 164460 1641681
PAYE Reference:	1160/FB116365

Exhibit 10.7

Roku, Inc.

Restricted Stock Unit Grant Notice
(2017 Equity Incentive Plan)

Roku, Inc. (the “Company”), pursuant to its 2017 Equity Incentive Plan (the “Plan”), hereby awards to Participant a Restricted Stock Unit Award for the number of shares of the Company’s Common Stock (“Restricted Stock Units”) set forth below (the “Award”). The Award is subject to all of the terms and conditions as set forth in this notice of grant (this “Restricted Stock Unit Grant Notice”) and the Restricted Stock Unit Award Agreement (the “Award Agreement”), and in the Plan, all of which are attached hereto and incorporated herein in their entirety. Capitalized terms not otherwise defined herein will have the meanings set forth in the Plan or the Award Agreement. In the event of any conflict between the terms in this Restricted Stock Unit Grant Notice, the Award Agreement and/or the Plan, the terms of the Plan will control.

Participant:
Date of Grant:
Vesting Commencement Date:
Number of Restricted Stock Units/Shares:

Vesting Schedule:

[Initial Grant:] 1/3^rd of the total Number of Restricted Stock Unit/Shares will vest on each annual anniversary of the Vesting Commencement Date, subject to Participant’s Continuous Service as a Non-Employee Director through the applicable vesting date. / [Annual Grant:] 100% of the Number of Restricted Stock Unit/Shares shall vest in full on the one year anniversary of the Vesting Commencement Date, subject to Participant’s Continuous Service as a Non-Employee Director through such vesting date.

Notwithstanding the foregoing, the vesting of the Restricted Stock Units shall accelerate in full effective immediately prior to the consummation of a Change in Control, subject to Participant’s Continuous Service as a Non-Employee Director through such time.

Issuance Schedule:

The shares of Common Stock to be issued in respect of the Award will be issued in accordance with the issuance schedule set forth in Section 6 of the Award Agreement.

Additional Terms/Acknowledgements: Participant acknowledges receipt of, and understands and agrees to all of the terms and conditions set forth in this Restricted Stock Unit Grant Notice, the Award Agreement and the Plan. Participant acknowledges and agrees that this Restricted Stock Unit Grant Notice and the Award Agreement may not be modified, amended or revised except as provided in the Award Agreement and the Plan. Participant further acknowledges that as of the Date of Grant, this Restricted Stock Unit Grant Notice, the Award Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the acquisition of Common Stock pursuant to the Award and supersede all prior oral and written agreements on that subject with the exception, if applicable, of (i) equity awards previously granted and delivered to Participant and (ii) any compensation recovery policy that is adopted by the Company or is otherwise required by applicable law.

Roku, Inc.		Participant

By:
	Signature		Signature

Title:		Date:

Date:

Participant:

Signature

Attachments: Award Agreement and 2017 Equity Incentive Plan

Attachment I

Roku, Inc.

2017 Equity Incentive Plan

Restricted Stock Unit Award Agreement

Pursuant to the Restricted Stock Unit Grant Notice (the “Grant Notice”) and this Restricted Stock Unit Agreement (the “Award Agreement”) Roku, Inc. (the “Company”) has awarded you a Restricted Stock Unit Award (the “Award”) pursuant to Section 6 of the Company’s 2017 Equity Incentive Plan (the “Plan”) for the number of Restricted Stock Units/shares indicated in the Grant Notice. Capitalized terms not explicitly defined in this Award Agreement or the Grant Notice will have the same meanings given to them in the Plan. The terms of your Award, in addition to those set forth in the Grant Notice and the Plan, are as follows.

2.Vesting. Subject to the limitations contained herein, your Award will vest, if at all, in accordance with the vesting schedule provided in the Grant Notice, provided that vesting will cease upon the termination of your Continuous Service as a Non-Employee Director. Upon such termination of your Continuous Service as a Non-Employee Director, the Restricted Stock Units/shares of Common Stock credited to the Account that were not vested on the date of such termination will be forfeited at no cost to the Company and you will have no further right, title or interest in or to such underlying shares of Common Stock.

For purposes of your Award, your Continuous Service will be considered terminated (regardless of the reason of termination, whether or not later found to be invalid or in breach of employment or other laws or rules in the jurisdiction where you are providing services or the terms of your employment or service agreement, if any) effective as of the date that you cease to actively provide services to the Company as a Non-Employee Director will not be extended by any notice period (e.g., employment or service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment or other laws in the jurisdiction where you are employed or providing services or the terms of your employment or service agreement, if any). The Board shall have exclusive discretion to determine when you are no longer providing Continuous Service as a Non-Employee Director for purposes of the Plan (including whether you still may be considered to be providing services while on a leave of absence).

Units and shares covered by your Award. Notwithstanding the provisions of this Section 3, no fractional shares or rights for fractional shares of Common Stock will be created pursuant to this Section 3. Any fraction of a share will be rounded down to the nearest whole share.

4.Compliance. You may not be issued any Common Stock under your Award unless the shares of Common Stock underlying the Restricted Stock Units are either (i) then registered under the Securities Act, or (ii) the Company has determined that such issuance would be exempt from the registration requirements of the Securities Act. Your Award must also comply with other applicable laws and regulations governing the Award, including any U.S. and non-U.S. state, federal and local laws, and you will not receive such Common Stock if the Company determines that such receipt would not be in material compliance with such laws and regulations.

5.Transfer Restrictions. Prior to the time that shares of Common Stock have been delivered to you, you may not transfer, pledge, sell or otherwise dispose of this Award or the shares issuable in respect of your Award, except as expressly provided in this Section 5. For example, you may not use shares that may be issued in respect of your Restricted Stock Units as security for a loan. The restrictions on transfer set forth herein will lapse upon delivery to you of shares in respect of your vested Restricted Stock Units. Notwithstanding the foregoing, if permitted by the Company, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, will thereafter be entitled to receive any distribution of Common Stock to which you were entitled at the time of your death pursuant to this Award Agreement. In the absence of such a designation, your legal representative will be entitled to receive, on behalf of your estate, such Common Stock or other consideration.

6.Date of Issuance.

(b)If the Original Issuance Date falls on a date that is not a business day, delivery will instead occur on the next following business day. In addition, if:

(c)The form of delivery of the shares of Common Stock in respect of your Award (e.g., a stock certificate or electronic entry evidencing such shares) will be determined by the Company.

8.Restrictive Legends. The shares of Common Stock issued under your Award will be endorsed with appropriate legends as determined by the Company.

10.Responsibility for Taxes.

(b)Prior to the relevant taxable or tax withholding event, as applicable, you agree to make adequate arrangements satisfactorily to the Company and/or the Employer to satisfy all Tax-Related Items. In this regard, you authorize the Company and/or the Employer, or their respective agents, at their discretion, to satisfy their withholding obligations with regard to all Tax-Related Items by: (i) withholding from your wages or any other cash compensation otherwise payable to you by the Company and/or the Employer; (ii) causing you to tender a cash payment; (iii) permitting or requiring you to enter into a “same day sale” commitment, if applicable, with a broker-dealer that is a member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) (pursuant to this authorization and without further consent) whereby you irrevocably elect to sell a portion of the shares to be delivered in connection with your Restricted Stock Units to satisfy the Tax-Related Items and whereby the FINRA Dealer irrevocably commits to forward the proceeds necessary to satisfy the Tax-Related Items directly to the Company and its Affiliates; or (iv) withholding shares of Common Stock from the shares of Common Stock issued or otherwise issuable to you in connection with the Award with a Fair Market Value (measured as of the date shares of Common Stock are issued to you pursuant to Section 6) equal to the amount of such Tax-Related Items; provided, however that if you are an Officer, then the Company will withhold a number of shares of Common Stock upon the relevant taxable or tax withholding event, as applicable, unless the use of such withholding method is not feasible under applicable law or has materially adverse accounting consequences, in which case, the obligation for Tax-Related Items may be satisfied by one or a combination of methods (i)-(iii) above. The Company or the Employer may withhold or account for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case you may receive a refund of any over-withheld amount in cash and will have no entitlement to the Common Stock equivalent. If the obligation for Tax-Related Items is satisfied by withholding in a number of shares of Common Stock, for tax purposes, you will be deemed to have been issued the full number of shares of Common Stock subject to the vested Restricted Stock Units, notwithstanding that a number of the shares of Common Stock is held back solely for the purpose of paying the Tax-Related Items. However, the Company does not guarantee that you will be able to satisfy the Tax-Related Items through any of the methods described in the preceding provisions and in all circumstances you remain responsible for timely and fully satisfying the Tax-Related Items.

(c)Unless the Tax-Related Items of the Company and any Affiliate are satisfied, the Company will have no obligation to deliver to you any Common Stock or other consideration pursuant to this Award.

11.Award not a Service Contract.

(a)Your Continuous Service with the Company, the Employer or any other Affiliate is not for any specified term and may be terminated by you or by the Company, the Employer or any other Affiliate at any time, for any reason, with or without cause and with or without notice. Nothing in this Award Agreement (including, but not limited to, the vesting of your Award or the issuance of the shares subject to your Award), the Plan or any covenant of good faith and fair dealing that may be found implicit in this Award Agreement or the Plan will: (i) confer upon you any right to continue in the employ of, or affiliation with the Employer; (ii) constitute any promise or commitment by the Company, the Employer or any other Affiliate regarding the fact or nature of future positions, future work assignments, future compensation or any other term or condition of employment or affiliation; (iii) confer any right or benefit under this Award Agreement or the Plan unless such right or benefit has specifically accrued under the terms of this Award Agreement or Plan; or (iv) deprive the Company or the Employer of the right to terminate you at any time and without regard to any future vesting opportunity that you may have. Finally, the grant of the Award shall not be interpreted as forming an employment or service contract with the Company.

(b)By accepting this Award, you acknowledge and agree that the right to continue vesting in the Award is earned only by continuing as a Non-Employee Director and that the Company has the right to reorganize, sell, spin-out or otherwise restructure one or more of its businesses or Affiliates at any time or from time to time, as it deems appropriate (a “reorganization”). You further acknowledge and agree that such a reorganization could result in the termination of your Continuous Service as a Non-Employee Director, including but not limited to, the termination of the right to continue vesting in the Award. You further acknowledge and agree that this Award Agreement, the Plan, the transactions contemplated hereunder and the vesting schedule set forth herein or any covenant of good faith and fair dealing that may be found implicit in any of them do not constitute an express or implied promise of continued engagement as an employee or consultant for the term of this Award Agreement, for any period, or at all, and will not interfere in any way with your right or the right of the Company, the Employer or any other Affiliate to terminate your Continuous Service at any time, with or without cause and with or without notice, and will not interfere in any way with the Company’s right to conduct a reorganization.

12. Nature of Grant. In accepting your Award, you acknowledge, understand and agree that:

(c)all decisions with respect to future awards of Restricted Stock Units or other grants, if any, will be at the sole discretion of the Company;

(d)you are voluntarily participating in the Plan;

(e)the future value of the shares of Common Stock underlying the Award is unknown, indeterminable and cannot be predicted with certainty;

(j)The following provisions apply only if you are employed or rendering services outside the United States:

(i)the Award and the shares of Common Stock subject to the Award, and the income from and value of same, are not part of normal or expected compensation for any purpose; and

13.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying shares of Common Stock. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan.

14.Data Privacy.

(a)As per standard Human Resources practices in the United States, the Company and the Employer process certain personal information about you for a number of purposes in connection with your employment, including the implementing, administering and managing of the Plan. The personal information that we process in connection with the Plan typically includes your name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number, salary, nationality, job title, any shares of Common Stock or directorships held in the Company, details of all Restricted Stock Units or any other entitlement to shares of Common Stock or equivalent benefits awarded, canceled, exercised, vested, unvested or outstanding in your favor (“Data”). The Company will process the Data only as long as is necessary to implement, administer and manage your participation in the Plan, or as required to comply with legal or regulatory obligations, including under tax, exchange control, labor and securities laws.

(b)For more information about the Company and Employer's processing of your personal information, including information about your rights over the Data, please refer to Roku Human Resources in the United States.

22.Insider Trading Restrictions/Market Abuse Laws. You may be subject to insider trading restrictions and/or market abuse laws based on the exchange on which the shares of Common Stock are listed and in applicable jurisdictions, including the United States and your country or your broker’s country, if different, which may affect your ability to accept, acquire, sell or otherwise dispose of shares of Common Stock, rights to shares of Common Stock (e.g., Restricted Stock Units) or rights linked to the value of shares of Common Stock during such times as you are considered to have “inside information” regarding the Company (as defined by the laws in applicable jurisdictions). Local insider trading laws and regulations may prohibit the cancellation or amendment of orders you placed before you possessed inside information. Furthermore, you could be prohibited from (i) disclosing the inside information to any third party, which may include Company employees, and (ii) “tipping” third parties or causing them otherwise to buy or sell securities. Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable insider trading policy of the Company. You acknowledge that it is your responsibility to comply with any applicable restrictions and you should speak with your personal legal advisor on this matter.

24.Imposition of Other Requirements. The Company reserves the right to impose other requirements on your participation in the Plan, and on any shares of Common Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

25.Governing Law/Venue. The interpretation, performance and enforcement of this Award Agreement will be governed by the law of the State of Delaware without regard to that state’s conflicts of laws rules. For purposes of any action, lawsuit or other proceedings brought to enforce this Award Agreement, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive jurisdiction of the courts within Santa Clara County, State of California, and no other courts, where this grant is made and/or to be performed.

26.Miscellaneous.

(b)You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

27.Amendment. This Award Agreement may not be modified, amended or terminated except by an instrument in writing, signed by you and by a duly authorized representative of the Company. Notwithstanding the foregoing, this Award Agreement may be amended solely by the Board by a writing which specifically states that it is amending this Award Agreement, so long as a copy of such amendment is delivered to you, and provided that, except as otherwise expressly provided in the Plan, no such amendment materially adversely affecting your rights hereunder may be made without your written consent. Without limiting the foregoing, the Board reserves the right to change, by written notice to you, the provisions of this Award Agreement in any way it may deem necessary or advisable to carry out the purpose of the Award as a result of any change in applicable laws or regulations or any future law, regulation, ruling, or judicial decision, provided that any such change will be applicable only to rights relating to that portion of the Award which is then subject to restrictions as provided herein.

28.Compliance with Section 409A of the Code. This Award is intended to comply with the “short-term deferral” rule set forth in Treasury Regulation Section 1.409A-1(b)(4). Notwithstanding the foregoing, if it is determined that the Award fails to satisfy the requirements of the short-term deferral rule and is otherwise deferred compensation subject to Section 409A, and if you are a “Specified Employee” (within the meaning set forth in Section 409A(a)(2)(B)(i) of the Code) as of the date of your “separation from service” (within the meaning of Treasury Regulation Section 1.409A-1(h) and without regard to any alternative definition thereunder), then the issuance of any shares that would otherwise be made upon the date of the separation from service or within the first six (6) months thereafter will not be made on the originally scheduled date(s) and will instead be issued in a lump sum on the earlier of: (i) the fifth business day following your death, or (ii) the date that is six (6) months and one day after the date of the separation from service, with the balance of the shares issued thereafter in accordance with the original vesting and issuance schedule set forth above, but if and only if such delay in the issuance of the shares is necessary to avoid the imposition of adverse taxation on you in respect of the shares under Section 409A of the Code. Each installment of shares that vests is intended to constitute a “separate payment” for purposes of Treasury Regulation Section 1.409A-2(b)(2).

* * * * *

This Award Agreement will be deemed to be signed by the Company and you upon your signing or otherwise by your acceptance of the Restricted Stock Unit Grant Notice to which it is attached.

Attachment II

2017 Equity Incentive Plan

Exhibit 10.8

Roku, Inc.

Stock Option Grant Notice

(2017 Equity Incentive Plan)

Roku, Inc. (the “Company”), pursuant to its 2017 Equity Incentive Plan (the “Plan”), hereby grants to Optionholder an option to purchase the number of shares of the Company’s Common Stock set forth below. This option is subject to all of the terms and conditions as set forth in this stock option grant notice (this “Stock Option Grant Notice”), in the Option Agreement (the “Agreement”), the Plan and the Notice of Exercise, all of which are attached hereto and incorporated herein in their entirety. Capitalized terms not explicitly defined herein but defined in the Plan or the Agreement will have the same definitions as in the Plan or the Agreement. If there is any conflict between the terms in this Stock Option Grant Notice, the Agreement and/or the Plan, the terms of the Plan will control.

Optionholder:
Date of Grant:
Vesting Commencement Date:
Number of Shares Subject to Option:
Exercise Price (Per Share):
Total Exercise Price:
Expiration Date:

Type of Grant:

☐ Incentive Stock Option ☒ Nonstatutory Stock Option

Exercise Schedule:

Same as Vesting Schedule

Vesting Schedule:

___ of the total Number of Shares Subject to Option will vest on each monthly anniversary of the Vesting Commencement Date, subject to Optionholder’s Continuous Service as a Non-Employee Director through the applicable vesting date.

Notwithstanding the foregoing, the vesting of this option shall accelerate in full effective immediately prior to the consummation of a Change in Control, subject to Optionholder’s Continuous Service as a Non-Employee Director through such time.

Payment:

By one or a combination of the following items (described in the Agreement):

☐

By cash, check, bank draft, wire transfer or money order payable to the Company

☐

Pursuant to a Regulation T Program if the shares are publicly traded

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By delivery of already-owned shares if the shares are publicly traded

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Subject to the Company’s consent at the time of exercise, by a “net exercise” arrangement

Additional Terms/Acknowledgements: Optionholder acknowledges receipt of, and understands and agrees to all of the terms and conditions set forth in, this Stock Option Grant Notice, the Agreement and the Plan. Optionholder acknowledges and agrees that this Stock Option Grant Notice and the Agreement may not be modified, amended or revised except as provided in the Agreement and the Plan. Optionholder further acknowledges that as of the Date of Grant, this Stock Option Grant Notice, the Agreement, and the Plan set forth the entire understanding between Optionholder and the Company regarding this option award and supersede all prior oral and written agreements, promises and/or representations on that subject with the exception of (i) options previously granted and delivered to Optionholder and (ii) any compensation recovery policy that is adopted by the Company or is otherwise required by applicable law.

By accepting this option, Optionholder consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

Roku, Inc.		Optionholder:

By:
	Signature		Signature
Title:		Date:
Date:

By providing an additional signature below or by electronically accepting this Agreement pursuant to the Company’s instructions to Optionholder (including through an online acceptance process), Optionholder declares that he or she expressly agrees with the data processing practices described in Section 12 of the Agreement and consents to the collection, processing and use of Data (as defined in Section 12 of the Agreement) by the Company and the transfer of Data to the recipients mentioned in Section 12 of the Agreement, including recipients located in countries which do not provide an adequate level of protection from a European (or other non-U.S.) data protection law perspective, for the purposes described in Section 12 of the Agreement. Optionee understands that, as a condition of receiving the option, Optionholder must provide his or her signature below or electronically accept this option, otherwise the Company may forfeit the option. Optionholder understands that he or she may withdraw consent at any time with future effect for any or no reason as described in Section 12 of the Agreement.

Optionholder:

Signature

Attachments: Agreement, 2017 Equity Incentive Plan, and Notice of Exercise

Attachment I

Roku, Inc.

2017 Equity Incentive Plan

Option Agreement

(Nonstatutory Stock Option)

Pursuant to your Stock Option Grant Notice (“Stock Option Grant Notice”) and this Option Agreement (this “Agreement”), Roku, Inc. (the “Company”) has granted you an option under its 2017 Equity Incentive Plan (the “Plan”) to purchase the number of shares of the Company’s Common Stock indicated in your Stock Option Grant Notice at the exercise price indicated in your Stock Option Grant Notice. The option is granted to you effective as of the date of grant set forth in the Stock Option Grant Notice (the “Date of Grant”). If there is any conflict between the terms in this Agreement and the Plan, the terms of the Plan will control. Capitalized terms not explicitly defined in this Agreement or in the Stock Option Grant Notice but defined in the Plan will have the same definitions as in the Plan.

The details of your option, in addition to those set forth in the Stock Option Grant Notice and the Plan, are as follows:

1.Vesting. Your option will vest as provided in your Stock Option Grant Notice. Vesting will cease upon the termination of your Continuous Service as a Non-Employee Director, as described in Section 6 below.

2.Number of Shares and Exercise Price. The number of shares of Common Stock subject to your option and your exercise price per share in your Stock Option Grant Notice will be adjusted for Capitalization Adjustments.

3.Method of Payment. You must pay the full amount of the exercise price for the shares you wish to exercise. You may pay the exercise price in cash or by check, bank draft, wire transfer or money order payable to the Company or in any other manner permitted by your Stock Option Grant Notice, which may include one or more of the following:

(a)Provided that at the time of exercise the Common Stock is publicly traded, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds. This manner of payment is also known as a “broker-assisted exercise”, “same day sale”, or “sell to cover,”

(b)Provided that at the time of exercise the Common Stock is publicly traded, by delivery to the Company (either by actual delivery or attestation) of already-owned shares of Common Stock that are owned free and clear of any liens, claims, encumbrances or security interests, and whose Fair Market Value is equal to the aggregate exercise price on the date of exercise. “Delivery” for these purposes, in the sole discretion of the Company at the time you exercise your option, will include delivery to the Company of your attestation of ownership of such shares of Common Stock in a form approved by the Company. You may not exercise your option by delivery to the Company of Common Stock if doing so would violate the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock.

4.Whole Shares. You may exercise your option only for whole shares of Common Stock.

5.Compliance. In no event may you exercise your option unless the shares of Common Stock issuable upon exercise are then registered under the Securities Act or, if not registered, the Company has determined that your exercise and the issuance of the shares would be exempt from the registration requirements of the Securities Act. The exercise of your option also must comply with all other applicable laws and regulations governing your option, including any U.S. and non-U.S. state, federal and local laws, and you may not exercise your option if the Company determines that such exercise would not be in material compliance with such laws and regulations (including any restrictions on exercise required for compliance with Treas. Reg. 1.401(k)-1(d)(3), if applicable).

6.Term. You may not exercise your option before the Date of Grant or after the expiration of the option’s term. The term of your option expires, subject to the provisions of Section 5(h) of the Plan, upon the earliest of the following:

(a)immediately upon the termination of your Continuous Service for Cause;

(b)the Expiration Date indicated in your Stock Option Grant Notice; and

(c)the day before the tenth (10th) anniversary of the Date of Grant.

For purposes of your option, your Continuous Service will be considered terminated (regardless of the reason of termination, whether or not later found to be invalid or in breach of employment or other laws or rules in the jurisdiction where you are providing services or the terms of your employment or service agreement, if any) effective as of the date that you cease to actively provide services to the Company as a Non-Employee Director and will not be extended by any notice period (e.g., employment or service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment or other laws in the jurisdiction where you are employed or providing services or the terms of your employment or service agreement, if any). The Board shall have exclusive discretion to determine when you are no longer actively employed or providing services for purposes of the Plan (including whether you still may be considered to be providing services while on a leave of absence).

7.Exercise.

(a)You may exercise the vested portion of your option during its term by (i) delivering a Notice of Exercise (in a form designated by the Company) or completing such other documents and/or procedures designated by the Company for exercise and (ii) paying the exercise price and any applicable Tax-Related Items (as defined in Section 9 below) to the Company’s Secretary, stock plan administrator, or such other person as the Company may designate, together with such additional documents as the Company may then require.

(b)By exercising your option you agree that, as a condition to any exercise of your option, the Company may require you to enter into an arrangement providing for the payment by you to the Company of any Tax-Related Items.

8.Transferability. Except as otherwise provided in this Section 8 , your option is not transferable, except by will or by the laws of descent and distribution, and is exercisable during your life only by you.

(a)Certain Trusts. Upon receiving written permission from the Board or its duly authorized designee, you may transfer your option to a trust if you are considered to be the sole beneficial owner (determined under Section 671 of the Code and applicable U.S. state law, or comparable non-U.S. laws) while the option is held in the trust. You and the trustee must enter into transfer and other agreements required by the Company.

(b)Domestic Relations Orders. Upon receiving written permission from the Board or its duly authorized designee, and provided that you and the designated transferee enter into transfer and other agreements required by the Company, you may transfer your option pursuant to the terms of a domestic relations order, official marital settlement agreement or other divorce or separation instrument as permitted by Treasury Regulation 1.421-1(b)(2), or comparable non-U.S. law, that contains the information required by the Company to effectuate the transfer. You are encouraged to discuss the proposed terms of any division of this option with the Company prior to finalizing the domestic relations order or marital settlement agreement to help ensure the required information is contained within the domestic relations order or marital settlement agreement.

(c)Beneficiary Designation. Upon receiving written permission from the Board or its duly authorized designee, you may, by delivering written notice to the Company, in a form approved by the Company and any broker designated by the Company to handle option exercises, designate a third party who, on your death, will thereafter be entitled to exercise this option and receive the Common Stock or other consideration resulting from such exercise. In the absence of such a designation, your executor or administrator of your estate or your legal heirs will be entitled to exercise this option and receive, on behalf of your estate, the Common Stock or other consideration resulting from such exercise.

9.Responsibility for Taxes.

(a)You acknowledge that, regardless of any action the Company or, if different, your employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, fringe benefit tax, payment on account or other tax related items related to your participation in the Plan and legally applicable to you (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains your responsibility and may exceed the amount actually withheld by the Company or the Employer, if any. You further acknowledge that the Company and the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of your option, including, but not limited to, the grant, vesting or exercise of your option, the subsequent sale of shares of Common Stock acquired pursuant to such exercise and the issuance of any dividends; and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of your option to reduce or eliminate your liability for Tax-Related Items or achieve any particular tax result. You acknowledge and agree that you will not make any claim against the Company, or any of its Officers, Directors, Employees or Affiliates for Tax-Related Items arising from your option. In particular, you acknowledge that this option is exempt from Section 409A of the Code only if the exercise price per share specified in the Grant Notice is at least equal to the “fair market value” per share of the Common Stock on the Date of Grant and there is no other impermissible deferral of compensation associated with the option. Further, if you are subject to Tax-Related Items in more than one jurisdiction, you acknowledge that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

(b)Prior to the relevant taxable or tax withholding event, as applicable, you agree to make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all Tax-Related Items. In this regard, you authorize the Company and/or the Employer, or their respective agents, at their discretion, to satisfy their withholding obligations with regard to all Tax-Related Items by: (i) withholding from your wages or other cash compensation paid to you by the Company and/or the Employer, (ii) withholding from the proceeds of the sale of shares of Common Stock acquired at exercise of your option and sold either through a voluntary sale or through a mandatory sale arranged by the Company (on your behalf pursuant to this authorization without further consent); and/or (iii) withholding a number of shares of Common Stock that are otherwise deliverable to you upon exercise.

(c)Depending on the withholding method, the Company or the Employer may withhold or account for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case you may receive a refund of any over-withheld amount in cash and will have no entitlement to the Common Stock equivalent. If the obligation for Tax-Related Items is satisfied by withholding a number of shares of Common Stock, for tax purposes, you are deemed to have been issued the full number of shares of Common Stock, notwithstanding that a number of the shares of Common Stock is held back solely for the purpose of paying the Tax-Related Items.

(d)You agree to pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of your participation in the Plan that cannot be satisfied by the means previously described. You acknowledge and agree that the Company may refuse to honor the exercise and refuse to issue or deliver the shares of Common Stock, or the proceeds of the sale of the shares of Common Stock, if you fail to comply with your obligations in connection with the Tax-Related Items.

10.Nature of Grant. In accepting your option, you acknowledge, understand and agree that:

(b)the grant of this option is exceptional, voluntary and occasional and does not create any contractual or other right to receive future grants of options (whether on the same or different terms), or benefits in lieu of options, even if options have been granted in the past;

(c)all decisions with respect to future options or other grants, if any, will be at the sole discretion of the Company;

(d)you are voluntarily participating in the Plan;

(e)this option and the shares of Common Stock subject to this option, and the income and value of same, are not intended to replace any pension rights or compensation;

(f)the future value of the shares of Common Stock underlying the option is unknown, indeterminable, and cannot be predicted with certainty;

(g)if the underlying shares of Common Stock do not increase in value, the option will have no value;

(h)if you exercise the option and acquire shares of Common Stock, the value of such shares of Common Stock may increase or decrease in value, even below the exercise price;

(i)no claim or entitlement to compensation or damages shall arise from forfeiture of this option resulting from the termination of your Continuous Service (for any reason whatsoever, whether or not later found to be invalid or in breach of employment laws in the jurisdiction where you are employed or rendering services or the terms of your employment or service agreement, if any);

(j)unless otherwise provided in the Plan or by the Company in its discretion, the option and the benefits evidenced by this Agreement do not create any entitlement to have the option or any such benefits transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the shares of Common Stock;

(k)the option and the shares of Common Stock subject to the option, and the income from and value of same, are not part of normal or expected compensation for purposes of, including, without limitation, calculating any severance, resignation, termination, redundancy, dismissal, end-of-service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

(l)unless otherwise agreed with the Company, this option and any shares of Common Stock acquired under the Plan, and the income from and value of same, are not granted as consideration for, or in connection with, the service you may provide as a director of an Affiliate; and

(m)The following provisions apply only if you are employed or rendering services outside the United States:

(i)the option and the shares of Common Stock subject to the option, and the income from and value of same, are not part of normal or expected compensation for any purpose; and

(n)neither the Company, the Employer nor any other Affiliate shall be liable for any foreign exchange rate fluctuation between your local currency and the United States Dollar that may affect the value of the option or of any amounts due to you pursuant to the vesting or exercise of the option or the subsequent sale of any shares of Common Stock acquired upon exercise of the option.

11.No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying shares of Common Stock. You are hereby advised to consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan.

12.Data Privacy. As per standard Human Resources practices in the United States, the Company and the Employer process certain personal information about you for a number of purposes in connection with your services, including the implementing, administering and managing of the Plan. The personal information that we process in connection with the Plan typically includes your name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number, compensation, nationality, job title, any shares of Common Stock or directorships held in the Company, details of all options or any other entitlement to shares of Common Stock or equivalent benefits awarded, canceled, exercised, vested, unvested or outstanding in your favor (“Data”). The Company will process the Data only as long as is necessary to implement, administer and manage your participation in the Plan, or as required to comply with legal or regulatory obligations, including under tax, exchange control, labor and securities laws.

For more information about the Company and Employer’s processing of your personal information, including information about your rights over the Data, please refer to Roku Human Resources.

13.Right of Repurchase. The Company will have the right to repurchase all of the shares of Common Stock you acquire pursuant to the exercise of your option upon termination of your Continuous Service for Cause. Such repurchase will be at the exercise price you paid to acquire the shares and will be effected pursuant to such other terms and conditions, and at such time, as the Company will determine.

14.Option not a Service Contract. Your option is not an employment or service contract, and nothing in your option will be deemed to create in any way whatsoever any obligation on your part to continue in the service of the Company, or of the Company to continue your service. In addition, nothing in your option will obligate the Company or an Affiliate, their respective stockholders, boards of directors, officers or employees to continue any relationship that you might have as a Director or Consultant for the Company or an Affiliate. Finally, the grant of the option shall not be interpreted as forming an employment or service contract with the Company.

15.Notices. Any notice or request required or permitted hereunder will be given in writing to each of the other parties hereto and will be deemed effectively given on the earlier of (i) the date of personal delivery, (ii) delivery via electronic means, or (ii) for deliveries within the U.S., the date that is five (5) days after deposit in the United States Post Office (whether or not actually received by the addressee), by registered or certified mail with postage and fees prepaid, addressed to the Company at its primary executive offices, attention: Stock Plan Administrator, and addressed to you at your address as on file with the Company at the time notice is given, (iv) for deliveries outside the United States, the date that is seven (7) days after deposit with the applicable jurisdiction’s official mail service, with postage and fees prepaid, or (v) the date that is one (1) day after deposit with a reputable overnight courier, with shipping charges prepaid.

16.Governing Plan Document. Your option is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your option, and is further subject to all interpretations, amendments, rules and regulations, which may from time to time be promulgated and adopted pursuant to the Plan. If there is any conflict between the provisions of your option and those of the Plan, the provisions of the Plan will control. In addition, your option (and any compensation paid or shares issued under your option) is subject to recoupment in accordance with The U.S. Dodd–Frank Wall Street Reform and Consumer Protection Act and any implementing regulations thereunder, any clawback policy adopted by the Company and any compensation recovery policy otherwise required by applicable law. No recovery of compensation under such a clawback policy will be an event giving rise to a right to voluntarily terminate employment upon a resignation for “good reason,” or for a “constructive termination” or any similar term under any plan of or agreement with the Company.

17.Other Documents. You hereby acknowledge receipt of and the right to receive a document providing the information required by Rule 428(b)(1) promulgated under the Securities Act, which includes the Plan prospectus. In addition, you acknowledge receipt of the Company’s policy permitting certain individuals to sell shares only during certain “window” periods and the Company’s insider trading policy, in effect from time to time.

18.Voting Rights. You will not have voting or any other rights as a shareholder of the Company with respect to the shares to be issued pursuant to this option until such shares are issued to you. Upon such issuance, you will obtain full voting and other rights as a shareholder of the Company. Nothing contained in this option, and no action taken pursuant to its provisions, will create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.

19.Severability. If all or any part of this Agreement or the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity will not invalidate any portion of this Agreement or the Plan not declared to be unlawful or invalid. Any Section of this Agreement (or part of such a Section) so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.

20.Language. If you have received this Agreement, or any other document related to this option and/or the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control. You acknowledge that you are sufficiently proficient in English, or have consulted with an advisor who is sufficiently proficient in English, so as to allow you to understand the terms and conditions of this Agreement.

21.Insider Trading Restrictions/Market Abuse Laws. You may be subject to insider trading restrictions and/or market abuse laws based on the exchange on which the shares of Common Stock are listed and in applicable jurisdictions, including the U.S. and your country or your broker’s country, if different, which may affect your ability to accept, acquire, sell or otherwise dispose of shares of Common Stock, rights to shares of Common Stock (e.g., options) or rights linked to the value of shares of Common Stock during such times as you are considered to have “inside information” regarding the Company (as defined by the laws in applicable jurisdictions). Local insider trading laws and regulations may prohibit the cancellation or amendment of orders you placed before you possessed inside information. Furthermore, you could be prohibited from (i) disclosing the inside information to any third party, which may include Company employees, and (ii) “tipping” third parties or causing them otherwise to buy or sell securities. Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable insider trading policy of the Company. You acknowledge that it is your responsibility to comply with any applicable restrictions and you should speak with your personal legal advisor on this matter.

22.Foreign Asset/Account and Tax Reporting, Exchange Controls. Your country may have certain foreign asset, account and/or tax reporting requirements and exchange controls which may affect your ability to acquire or hold shares of Common Stock under the Plan or cash received from participating in the Plan (including from any dividends received or sale proceeds arising from the sale of shares of Common Stock) in a brokerage or bank account outside your country. You understand that you may be required to report such accounts, assets or transactions to the tax or other authorities in your country. You also may be required to repatriate sale proceeds or other funds received as a result of participation in the Plan to your country through a designated bank or broker and/or within a certain time after receipt. In addition, you may be subject to tax payment and/or reporting obligations in connection with any income realized under the Plan and/or from the sale of shares of Common Stock. You acknowledge that you are responsible for complying with all such requirements, and that you should consult personal legal and tax advisors, as applicable, to ensure compliance.

23.Imposition of Other Requirements. The Company reserves the right to impose other requirements on your participation in the Plan, and on any shares of Common Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

24.Governing Law/Venue. The interpretation, performance and enforcement of this Agreement will be governed by the law of the State of Delaware without regard to that state’s conflicts of laws rules. For purposes of any action, lawsuit or other proceedings brought to enforce this Agreement, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive jurisdiction of the courts within Santa Clara County, State of California, and no other courts, where this grant is made and/or to be performed.

25.Miscellaneous.

(a)The rights and obligations of the Company under your option will be transferable to any one or more persons or entities, and all covenants and agreements hereunder will inure to the benefit of, and be enforceable by the Company’s successors and assigns.

(b)You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your option.

(c)You acknowledge and agree that you have reviewed your option in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your option, and fully understand all provisions of your option.

(d)All obligations of the Company under the Plan and this Agreement will be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.

* * *

This Agreement will be deemed to be signed by you upon the signing by you or otherwise by your acceptance of the Grant Notice to which it is attached.

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Anthony Wood, certify that:

1)	I have reviewed this Quarterly Report on Form 10-Q of Roku, Inc.;

2)	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3)	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4)	The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5)	The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 9, 2019	By:	/s/ Anthony Wood
		Anthony Wood
		President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Steve Louden, certify that:

1)	I have reviewed this Quarterly Report on Form 10-Q of Roku, Inc.;

2)	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3)	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4)	The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

5)	The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 9, 2019	By:	/s/ Steve Louden
		Steve Louden
		Chief Financial Officer

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Anthony Wood, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

The Quarterly Report on Form 10-Q of Roku, Inc. for the quarter ended June 30, 2019, as filed with the Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in such Quarterly Report on Form 10-Q fairly presents in all material respects, the financial condition and results of operations of Roku, Inc.

Date: August 9, 2019	By:	/s/ Anthony Wood
		Anthony Wood
		President and Chief Executive Officer

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Steve Louden, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

The information contained in such Quarterly Report on Form 10-Q fairly presents in all material respects, the financial condition and results of operations of Roku, Inc.

Date: August 9, 2019	By:	/s/ Steve Louden
		Steve Louden
		Chief Financial Officer