While 2022 was a bit of a horror show for Cathie Wood's exchange-traded funds (ETFs), things are looking up this year. The Ark Invest CEO has seen all of her firm's eight funds outperform the market year to date.

It's too soon to know whether this outperformance will persist for the rest of 2023, but some companies that are among her favorite holdings have excellent long-term prospects, regardless of what happens to their shares this year. Among them are Block (SQ 1.68%) and Roku (ROKU 2.94%), two stocks that are worth holding onto for the next decade.

1. Block

Shares of fintech specialist Block are already up 35% year to date, but that's not even close to the best reason to consider investing in the company, at least not for those with a long-term mindset. Instead, investors should look at Block's lucrative Square and Cash App platforms.

Block helps small- and medium-sized businesses run their operations through its Square ecosystem with payment processing solutions and a suite of other services such as payroll services, inventory management, and the ability to integrate brick-and-mortar and e-commerce transactions.

The great thing about Block's offerings is that they're interconnected. Once a company is plugged into Square, it becomes difficult to leave without risking business disruptions. High switching costs give Square a competitive edge. 

On the other side of the coin, the company's peer-to-peer (P2P) payment app, Cash App, competes with traditional banks in many ways. It offers stock and crypto trading, a debit card, "buy now, pay later" options, and more.

Both of these segments performed well last year. In the third quarter, Block recorded net revenue of $4.52 billion, up 17% year over year. Its gross profit jumped 38% to $1.57 billion, with gross profits for Square and Cash App rising 29% and 51%, respectively. Block remains unprofitable, and it booked a $15 million net loss in the third quarter.

The company has also seen decreasing revenue related to its Bitcoin services.

But both of the company's main ecosystems have plenty of opportunities ahead of them. Management foresees a $120 billion (and growing) annual gross profit opportunity. That's substantially more than it records now. And the company has historically attracted more customers by adding services that render its ecosystems even more valuable.

Investors can expect more of that in the future. Block's stock price moves may or may not maintain their recent torrid pace for the rest of the year, but the company looks to be in an excellent position to ride the fintech revolution over the next 10 years and beyond while rewarding shareholders in the process. 

2. Roku 

Roku gathers many of the giant content providers of the video streaming world into one place, making it an ideal platform for consumers as more and more of people's viewing time is spent with streaming services. In early January, the company reported that it had surpassed 70 million active accounts, up from 60.1 million at the end of 2021. This massive ecosystem is a prime target for advertisers, especially as streaming hours continue to grow -- which they have been doing for years.

The more that people choose to watch shows and movies on their preferred streaming services -- and which ones those are makes little difference to Roku -- the more businesses will seek out this platform to target potential customers with ads. In addition to growing viewing hours, it's worth noting that 70 million active accounts is a relatively small number given the size of the worldwide market.

Roku claims it is the leading television streaming platform in the U.S., Canada, and Mexico based on hours streamed. These three countries alone have a combined population of almost 500 million. Roku's penetration in most other markets is certainly much lower than it is in those nations.

It's true Roku's stock was hammered last year due to a general slowdown in the advertising business.

Also, inflation and supply chain issues increased the manufacturing costs of its streaming devices, but the company chose to absorb the higher expenses rather than pass them on to consumers. The inevitable economic cycles will sometimes swing in the wrong direction, but they usually bounce back.

And importantly, nothing happened in 2022 that fundamentally changed Roku's prospects. Advertising spending will increase eventually as the economy recovers. Meanwhile, Roku will keep growing its ecosystem with more active accounts and greater engagement. So long as the migration from old linear television continues -- a trend that should remain healthy for many years -- Roku will still have room to grow.

Being at the top of an expanding market will allow the company to deliver solid returns over the course of the next decade and more