Roku Cuts Staff and Exceeds Third-Quarter Projections
Roku, the popular streaming platform, has announced that it will be reducing its staff by 10% in an effort to control rising costs. The company also revealed that it is projected to exceed its third-quarter revenue guidance, causing its shares to rise significantly in premarket trading.
Strong Revenue Projection
Roku has revised its revenue forecast for the quarter, anticipating a range of $835 million to $875 million. This is an increase from their previous estimate of $815 million and surpasses analysts' average expectation of $828.6 million.
Improved Ebitda Outlook
Additionally, the company expects an adjusted Ebitda loss of $20 million to $40 million for the quarter. This is a notable improvement from their earlier guidance of a negative $50 million. Wall Street had also predicted a deficit of $41 million, making Roku's projected loss better than anticipated.
Restructuring Measures
As part of the cost containment efforts, Roku has committed to a series of restructuring measures. These include reducing office space, implementing hiring restrictions, and removing certain content from its platform. These actions aim to align the company's operations with its long-term goal of achieving positive adjusted Ebitda by 2024.
Positive Market Response
Investors have reacted positively to Roku's announcements, resulting in a surge in share prices. Despite already doubling in value this year, Roku's shares have continued to rise, reaching $92.80 in premarket trading.
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