A couple minor updates this week… then I’ll dig into my theme of patience — which of my investments that fall into the “long duration stories which require patience” are really worthy of that patience right now, given recent updates? That’s a loaded question, but thinking it through led me to sell two positions, add to one, and adjust my “buy” prices for some others.

But first, a couple quick notes…

The press releases I like least are those that promise big layoffs… and cause the stock to surge.  Yes, some companies got bloated and over-hired and forgot to pay attention to the bottom line, and investors want more focus on profitability now… but when you hear about thousands of people losing their jobs and the stock bounces higher, I kind of feel like a cross between the monocled Monopoly Man and Ebeneezer Scrooge.

That’s what happened earlier this week with Roku (ROKU), which announced that they’re cutting about 10% of their staff and also reducing costs in other areas (consolidating office space, reducing some content spending for the Roku Channel), which is really a follow-through on promises they’ve made over the past year or so to become more efficient and more cost-conscious as their growth slows and they struggle to get back to profitability (this will mean that they’ve cut about 20% of their workforce in the last year, roughly 750 people). 

Investors pretty much always like to hear that kind of cost-cutting talk, even if we don’t really like to think about lots of people being laid off in our communities, but the more objectively optimistic news is that they’re also raising their revenue guidance — last quarter they told us to expect $815 million in revenue for the current quarter, and now they’re raising that to “$835-875 million.”  At the midrange, that would be 12% revenue growth for this quarter (year over year), which is a dramatic slowdown from the wild growth they had in 2020 and 2021, but also a reassuring recovery from recent weak quarters (the last four quarters had growth of 10.8%, 1%, 0.2%, and 12%… before that, it averaged something like 40-50% for several years). That’s a signal that advertising is still recovering, and Roku’s inventory, thanks to their huge and still growing user base is attractive to streaming TV advertisers (and it should be, with 73 million active ...