Roku May Be In a Lot of Trouble -- Here's Why

The last few days have been a wild ride in the stock market. At the end of last week, SVB Financial, one of the nation's largest financial institutions, faced a sudden liquidity crunch. During its earnings call, investors were caught off-guard when the company announced that it was seeking to raise additional capital.

Subsequently, businesses and individuals who held funds at Silicon Valley Bank began to request withdrawals. This spiraled into a metaphorical contagion, and seemingly overnight Silicon Valley Bank was hit with a bank run.

So, what does this have to do with Roku (NASDAQ: ROKU)? Well, SVB Financial has become the de facto bank of choice for, you guess it, technology companies in Silicon Valley. Following the bank run, Roku announced that the company held roughly a quarter of its cash with SVB Financial.

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Source Fool.com