Vizio’s income from advertising, subscriptions, and data is double that of selling TVs

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It’s been less than a year since Vizio became a publicly traded company, and as a result, we know more about its business than ever before. The TV maker released its latest earnings report on Tuesday, announcing that its Platform Plus segment, which includes advertising and viewer data, had gross profits of $ 57.3 million for the past three months. That’s more than double the profit made from sales of equipment such as televisions, which was $ 25.6 million, despite the fact that those equipment sales generated significantly more revenue.

When Vizio went public, it described the difference between the two divisions. While devices are easy to understand – 4K TVs, sound bars, etc. – Platform Plus is a little more complicated. It counts money made from selling ad placements on its TV home screens, deals for buttons on remote controls, ads running on streaming channels, its share of subscriptions and viewer data it tracks as part of the InScape program and sold.

The company says shipments of its TVs fell to 1.4 million in 2021, compared to 2.1 million in 2020, a 36 percent decrease. CEO William Wang told investors on the phone call that he sees “pretty healthy inventory” heading into the holiday season, so anyone planning to buy an inexpensive TV or soundbar should have some decent options available to them.

This spike in Platform Plus revenue, up 136 percent year over year, helped Vizio a lot to make up the difference as profits from televisions decreased year over year. Supply chain and logistics issues that affect many companies also hit Vizio hard, but executives also said the company is working with its outside partners to help locate warehouse and trucking workers.

Where the numbers continue to grow is the number of active SmartCast accounts, which are now over 14 million, and how much money they make on average with each user. That number nearly doubled year over year, increasing from $ 10.44 to $ 19.89. Speaking to investors and analysts, Vizio executives said 77 percent of that money came straight from advertising like those running on its WatchFree Plus package of streaming channels, a group that recently expanded to include content targeting. The next biggest contributor is the money it makes selling Inscape data about what people see.

Vizio isn’t the only smart TV maker really into the advertising business – as we noted a few years ago, while you probably know Roku for its TV operating system and streaming boxes, CEO Anthony Wood is very open about being true model. Roku’s most recent report found that each user makes an average of $ 40 a month, or more than double what Vizio manages. One way to catch up is by building its own in-app payment system, which Chief Revenue Officer Mike O’Donnell says will roll out for consumers next year.

A few years ago, Vizio ran into trouble with the FTC for not properly informing customers before they became part of the tracking program. It disabled the system on older TVs, paid a few million dollars to pay the fine, and went ahead with its new SmartCast technology, which focuses on streaming and ensures that new owners get a warning about what to choose .

If you own a Vizio TV and are new to all of this, you should visit the company’s privacy page for more information. It also tells you how to turn off Automatic Content Recognition (ACR) and data capture technology built into the televisions, which is available here. If you’d rather opt for a SmartCast TV, just follow these instructions:

Press the MENU button on your TV remote control.

Choose System.

Choose Reset and Manage.

Select Show data.

Press the RIGHT arrow button to change the setting to Off.

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