Roku Spending Up to $35M Cutting Office Leases, 200 More Jobs
By Greg Cornfield April 4, 2023 3:05 pm
reprints
Major streaming company Roku is shrinking its office footprint and cutting its labor force, adding to the national tech and media reset and putting it in step with the belt tightening seen at companies like Meta and Amazon.
The Silicon Valley streaming platform expects to pay from $30 million to $35 million to terminate leases and or sublease office property across the country, and to complete a second round of layoffs for 200 workers, or about 6 percent of its workforce, according to an SEC filing from Roku.
Roku declined to comment for this article.
This follows 200 layoffs by Roku in November 2023, and comes amid companies making similar but much larger moves, like Facebook’s parent company spending billions of dollars to cut its office space and reduce its headcount by thousands of employees. It also comes as office landlords and investors suffer landmark drops in demand and property values.
Roku is based in San Jose and also has large offices in Santa Monica, New York City and Chicago. The company leases about 1.3 million square feet of office space, according to CoStar’s data.
The company did not disclose specific locations it plans to cut, but it is already trying to secure a subtenant for a significant portion of the 240,000 square feet it signed for early last year at RXR’s 5 Times Square in New York City in early 2022, CoStar reported, citing CBRE marketing materials. Two years ago, Roku signed a 10-year lease to expand its space at Boston Properties (BXP)’ prize Colorado Center office campus in Santa Monica.
The company’s restructuring plan is aimed at lowering operating expenses and prioritizing “projects that the company believes will have a higher return on investment … and result in the exit and sublease, or cease use, of certain office facilities that the company does not currently occupy.” Roku expects most of the restructuring charges will be incurred in the first quarter, while the implementation of the headcount reductions will be complete by the end of the second.
According to CoStar, Roku reported earlier this year that its net losses more than doubled by the end of 2022 to nearly $500 million. CoStar also reported the company was affected by the Silicon Valley Bank collapse, when it had about $487 million, or about 26 percent of its cash and cash equivalents, in deposits with the regional bank.
Gregory Cornfield can be reached at gcornfield@commercialobserver.com.
