Roku says 26% of cash reserves are tied up in Silicon Valley Bank

  • About $487 million, or 26%, of Roku’s cash reserves are tied up in Silicon Valley Bank, the streamer said in an SEC filing on Friday.
  • Shares fell after hours on the news, but the company believes its remaining reserves will be sufficient to meet its financial obligations for at least the next twelve months.

A video sign displays the logo of Roku Inc, a Fox-backed video streaming company, in Times Square after the company’s IPO on Nasdaq Market in New York, September 28, 2017.

Brendan McDermid | Reuters

Roku has $487 million in cash and cash equivalents in uninsured deposits at the failed Silicon Valley Bank, the streaming media company said in an SEC filing on Friday.

About 26% of Roku’s $1.9 billion in cash was deposited with SVB, which was placed in receivership by the FDIC midday Friday.

Roku shares fell more than 4% in after-hours trading.

“At this time, the Company does not know to what extent it will be able to recover its cash on deposit with SVB,” Roku said in a press release.

Nonetheless, Roku said it believes it will be able to meet its capital obligations for the “next 12 months and beyond” with its unrestricted cash reserves of $1.4 billion in other ” large financial institutions”.

“As outlined in our 8-K, we expect that Roku’s ability to operate and meet its contractual obligations will not be affected,” a Roku spokesperson said in a statement to CNBC.

The collapse of SVB has shaken both large and small companies. As the preferred lender and banker to many Silicon Valley startups and venture capitalists, the company’s receivership has alarmed founders, who are concerned about meeting payrolls and critical obligations with cash. limited.

FDIC insurance only covers the first $250,000 of deposit accounts, a fraction of the money Roku and many other companies had deposited with SVB.

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