Roku Risks ‘Harm to Our Business’ if Virus Disrupts Supply Chain, Says 10-K
“Many uncertainties” surround the coronavirus and its impact on the Chinese supply chain, said Roku’s 2019 annual report Monday. Unknown are the “scientific and health issues” about how coronavirus spreads, plus the “duration and extent of economic disruption in China…
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
and other markets,” said the 10-K filing. Coronavirus “may result in supply shortages of our products or our licensee’s products,” said Roku. “Any decrease, limitations or delays on our or our licensees’ ability to import, export, or sell our streaming devices would harm our business.” Roku players use specific SoC solutions and Wi-Fi front-end modules from various manufacturers, “for which we do not have a second source,” said the company. “Although this approach allows us to maximize player performance on lower cost hardware,” it also creates “supply chain risk,” it said. These “sole-source suppliers” may face “production, shipping, or logistical constraints” from the coronavirus outbreak, it said. “Any such interruption or delay may force us to seek similar components from alternative sources, which may not be available.” Amazon, Best Buy and Walmart collectively were 72% of Roku player revenue in 2019, up from 68% in 2018, said Roku.