Roku Reveals Firings and Charges Over Streaming Content Removal – The Hollywood Reporter
Roku is laying off another 10 percent of its staff and incurring costs for further restructuring measures, the company announced in a regulatory filing on Wednesday.
The company cited an “ongoing evaluation of its operations” that led it to decide “to take additional actions to further reduce the year-over-year operating expense growth rate through a consolidation of office space occupancy and a strategic review of its content portfolio.” , Reducing spending on external services and slowing the growth rate of personnel expenses compared to the previous year, including through staff reductions and the limitation of new hires.”
The downsizing is expected to affect about 10 percent of the company’s employees, Roku said, led by founder, chairman and CEO Anthony Wood. Restructuring charges related to the downsizing, primarily composed of severance and employee benefits, are also anticipated at a preliminary estimate of $45 million to $65 million. Excluded from this range are charges related to the possible disruption of office facilities and content, which are described in paragraph 2.06 below. The Company anticipates that the majority of the restructuring charges will be incurred in the third quarter of fiscal 2023. The Company also anticipates that the implementation of the workforce reductions, including cash payments, will be substantially complete by the end of the fourth quarter of fiscal 2023.
“Related to the actions described above, the Company expects to incur an impairment charge in a preliminary estimate of $160 million to $200 million in the third quarter of fiscal 2023 related to the cessation of use of certain office equipment, as well as an impairment charge in a “preliminary estimate is $55 million to $65 million in connection with the removal of select existing licensed and produced content from the Company’s operated services on its TV streaming platform,” the filing reads.
Excluding restructuring and impairment charges, Roku now expects third-quarter revenue to reach $835 million to $875 million, with adjusted earnings before interest, taxes, depreciation and amortization reporting a loss of $20 million to $40 million becomes.
