Roku is planning to cut 200 jobs in the United States in a bid to reduce its operating expenses. Previously, the streaming devices company witnessed rapid expansion during the COVID-19 pandemic.
Roku is best known as a platform where consumers can connect with various streaming services, including its own free ad-supported Roku Channel. However, the company disclosed on Thursday that they plan to cut jobs in wake of current economic conditions. Moreover, the company is expecting that the layoffs will reduce the company’s human resources expenses by 5 percent. “Taking these actions now will allow us to focus our investments on key strategic priorities to drive future growth and enhance our leadership position,” Roku said in their official statement.
CEO’s message to stakeholders
The company is going through a slow revenue growth phase and CEO Anthony Wood discussed the situation with the stakeholders earlier this month. Ad spending on Roku’s platform grew more slowly than its earlier forecast. “As we enter the holiday season, we expect the macro environment to further pressure consumer discretionary spend and degrade advertising budgets, especially in the TV scatter market. We expect these conditions to be temporary, but it is difficult to predict when they will stabilize or rebound.” Roku Chief Executive Anthony Wood wrote to the stakeholders.
$31 million restructuring cost
Earlier, during pandemic Roku expanded significantly in South California amid growth in its catalog of original content. Moreover, the company doubled its headcount to 200 in Santa Monica. However, with slower growth the company has now decided to cut jobs in United States. They have announced to lay off 200 employees. Moreover, the company will incur an expense of $31 million in severance costs. They have already initiated the regulatory filings. The company expects to proceed with this restructuring cost during the fourth quarter which will end on December 31.
As of December 31, 2021, Roku had an active headcount of 3,000 employees globally.
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