Roku plans to cut 6% of its workforce as part of a restructuring, the streaming company said in a regulatory filing Thursday.
The cut amounts to about 200 jobs, based on the 3,600 employees the San Jose, California-based company claimed in its 2022 annual report filed in February. The layoffs are expected to be complete by the end of June, though legal matters may stretch that time frame a bit, Roku said.
It’s the second round of layoffs for Roku in five months. The streamer announced a similar reduction of 200 positions in November that was slated to be completed by year-end 2022.
Roku is just one of a string of tech, media and entertainment companies to slash its workforce in recent months. For companies large and small, including Disney, Microsoft, Amazon, Facebook and Instagram parent Meta Platforms, job cuts have come in waves since the start of the year as advertising has slowed and worries about a potential recession have lingered. Warner Bros. Discovery, AMC Networks, Netflix and other rival streamers have also trimmed staffs in the past year.
U.S.-based tech companies alone have cut more than 118,000 workers so far in 2023, according to the Crunchbase Tech Layoffs Tracker.
Roku said its latest layoffs are aimed at improving operating expense growth and will allow the company to “prioritize projects that the Company believes will have a higher return on investment.”
It’s not clear what projects might be axed. Roku launched a line of branded HD and 4K TVs earlier this month. The TVs were well reviewed, but sales figures for the devices have not been released.
The company also plans to exit or sublease office space it’s no longer using.
Roku reported robust revenue growth of 20% for 2022, but posted a $498 million loss for the year, reversing a 2022 profit.
Its fourth quarter results surprised Wall Street with a smaller-than-expected loss for the period as it added 10 million new active accounts, bringing its total to 70 million globally. Roku’s fourth quarter also showed strong advertising growth, despite the uncertain market as streaming hours increased. Average revenue per user, a key metric in streaming, grew 2% to $41.68 million for the year.
The layoffs and other restructuring efforts will result in Roku booking approximately $30 to $35 million charges . That figure reflects severance payments, employee benefits contributions and costs related to the real estate matters. Most of the charges will be recorded in the current quarter, the filing said.
In morning trading, Roku shares gained $1.35, or 2.1%, to $65.26.
Once a high flyer, trading over $467 during the pandemic, Roku’s stock has changed hands between $38.26 and $135.99 in the past 52 weeks. It is up almost 61% since the start of the year, far outpacing the benchmark S&P 500’s gain of 6%.