Roku (ROKU) Expands Health & Fitness Options With Peloton App

Roku ROKU recently added Peloton App, Peloton Interactive’s PTON virtual fitness platform for Roku streamers. The Peloton channel features thousands of instructor-led workouts that can be done with or without equipment.

The Peloton Roku app is available in the United States from Jul 1 and in Canada from Jul 2. A release date for the United Kingdom has not yet been decided. The news of the app deal helped push Roku’s stock up 10% on Jul 1 to a closing price of $128.39.

Roku is offering Peloton’s Digital Membership, which costs $12.99 a month. New users can take advantage of a 30-day free trial and sign up on Roku TV with Roku Pay while existing Peloton subscribers can log in for free via Roku TV. Classes covered include yoga, meditation, stretching, strength training and cycling. There are also guided workouts for outdoor runners.

Roku, Inc. Price and Consensus

Roku, Inc. Price and Consensus

Roku, Inc. price-consensus-chart | Roku, Inc. Quote

Peloton Deal: A Key Catalyst Amid Coronavirus

With coronavirus outbreak shuttering gyms and other athletic facilities for months, home workouts have gained in popularity. In the United States, the Health & Fitness category experienced the largest growth in streaming on Roku devices compared to other genres, growing by more than 130% in May compared with the same period in 2019.

The move is a clear win-win for both companies, which are expanding their respective user bases. Roku had nearly 40 million active accounts at the end of the first quarter, while Peloton had over 2.6 million members, including nearly 900K Connected Fitness subscribers in addition to almost 180K Digital subscribers.

Besides gaining incremental reach, Peloton said it plans to use Roku’s machine learning targeting capabilities to analyze 100,000-plus unique data signals to optimize Peloton app installs and sign-ups.

With the pandemic driving more people to seek home workout solutions, Peloton has expanded to a number of new platforms. Since late February, the company has launched apps for Apple’s AAPL streaming platform, Apple TV, Android TV as well as Alphabet GOOGL owned Google’s Chromecast support for its iOS app enabling iOS users to cast their classes to any device that supports Chromecast.

The partnership will also contribute to Roku’s advertising business, as Roku will help Peloton target prospective customers on its platform for app installs and sign-ups. The streaming TV tech company has used a similar multifaceted strategy before with other high-profile launches, helping content partners expand reach while simultaneously getting a cut of sales.

Roku’s Efforts to Attract Ad Revenues

Even amid the pandemic, Roku generated $232.6 million in first-quarter platform revenues, which include ads and licensing fees, against only $88.2 million from device sales.

Roku kicked off its new OneView ad platform last month with launch partners, Drizly, Experian, Intuit TurboTax and Lexus. The ad platform is designed to help advertisers use TV identity data to create ads across OTT, desktop and mobile from a single hub.

The live content on Roku Channel is free to view in exchange for eight minutes of advertising time per hour. Roku sells the ad spots on an ad-spot bidding platform built around assets from ad specialist Dataxu, which Roku acquired for $150 million last fall.

As of the end of first-quarter 2020, this Zacks Rank #3 (Hold) company had 39.8 million active streaming TV accounts, and the company streamed 13.2 billion hours. Roku described itself as the #1 U.S. streaming TV platform by hours streamed according to Kantar, and the largest licensed TV operating system in North America.

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