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Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

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Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#21

Could someone please explain what SVB is and what money being stuck there means? Why do companies put money there? For what reason would a company file, or have to file, an 8-K?

You want to check out this: https://news.ycombinator.com/item?id=35096877

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#22

Could someone please explain what SVB is and what money being stuck there means? Why do companies put money there? For what reason would a company file, or have to file, an 8-K?

Silicon Valley Bank.

Knowing that probably answers your other questions.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#24

I was astonished that Roku has half a billion in cash. Then I learned this was only 26% of its cash reserves. I thought cash was considered wasteful because it loses value via inflation. Has the thinking changed? Can someone knowledgeable please help me understand this?

You need cash to pay for things, like payroll and rent.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#25

I was astonished that Roku has half a billion in cash. Then I learned this was only 26% of its cash reserves. I thought cash was considered wasteful because it loses value via inflation. Has the thinking changed? Can someone knowledgeable please help me understand this?

You need cash to pay for things, like payroll and rent.

But you typically run off firm promises of cash from investors. Then you only need a couple of weeks cash in the bank, and the investors promise to make cash available on demand as you need it.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#26
This is not a perfect analysis, but:

- Roku has 487M in SVB

- After the 8-K released, Roku lost 323M in market cap

Basically, the market is expecting around 30c of value recouped for every dollar inside of SVB.

(note: I know this analysis isn't perfect, but it gives a rough idea)

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#28
post #26

This is not a perfect analysis, but: - Roku has 487M in SVB - After the 8-K released, Roku lost 323M in market cap Basically, the market is expecting around 30c of value recouped for every dollar inside of SVB. (note: I know this analysis isn't perfect, but it gives a rough idea)

I'd be pretty happy to buy SVB deposits at 30c if I could do that without exposure to Roku everything else, etc.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#29
post #26

This is not a perfect analysis, but: - Roku has 487M in SVB - After the 8-K released, Roku lost 323M in market cap Basically, the market is expecting around 30c of value recouped for every dollar inside of SVB. (note: I know this analysis isn't perfect, but it gives a rough idea)

The market expects the bank going under to impact Roku by that much expected value. That's very different than saying the market expects a certain percentage of money to be returned in the end and it's not clear why this is supposed to give even a ballpark estimate of the expected recoup. After all the share price has way more to it than what the current assets come to.

It's also very likely the market changes its mind shortly, especially if Roku lays out the plan and expected impact to operations in more detail.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#30
post #26

This is not a perfect analysis, but: - Roku has 487M in SVB - After the 8-K released, Roku lost 323M in market cap Basically, the market is expecting around 30c of value recouped for every dollar inside of SVB. (note: I know this analysis isn't perfect, but it gives a rough idea)

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