Roku, the streaming service hub and connected TV maker, announced plans to reduce its workforce by around 10% in order to cut expenses and bring down its operating expense growth rate. The company will slow down hiring, consolidate office space, and reduce service expenses as part of its cost-cutting measures. This move comes as Roku looks to improve its current-quarter revenue outlook.
Roku expects third-quarter revenues to be in the range of $835 million to $875 million, surpassing its previous projection of $815 million. The company’s subscriber base at the end of the second quarter stood at 73.5 million accounts. However, these cost-cutting measures will result in a ‘workforce reduction charge’ of $45 million to $65 million for the current quarter. Roku anticipates completing the job reductions by the end of the year.
Following the announcement of these measures, Roku shares surged 8.6% in pre-market trading, indicating an opening bell price of $90.97 per share. This increase will further extend the stock’s already impressive six-month gain of around 43%.
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