Roku Might Be Showing Signs of Growing Up. But Is It Enough to Buy the Stock?
The back half of 2022 and most of 2023 have been pretty tumultuous for corporations. While investors may be distracted by the myriad challenges facing businesses of all sizes due to the hype around artificial intelligence (AI) and the possibility of a new bull market, make no mistake -- challenges still linger.
The S 500 index and Nasdaq Composite Index are up over 10% and 25%, respectively, so far in 2023. However, investors should keep in mind that the rising demand for generative AI and machine learning are not the only catalysts pushing equities higher. Several companies, especially in Big Tech, resorted to layoffs in an effort to curb bloated expense profiles and return to a path of profitability, while for some, revenue growth has slowed.
To put it bluntly, layoffs are an unfortunate component of organizational structure. From time to time, companies hire too quickly or pursue initiatives that are well beyond the core pillars of the business. If these investments do not contribute to some form of top-line growth, a business may be forced to make some difficult decisions.
Source Fool.com
