Roblox Stock Is Sinking. Earnings Were Worse Than Expected.
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The videogame company reported record numbers of daily active users and hours engaged for the fourth quarter.
Courtesy of Roblox
Roblox
reported a record numbers of daily active users and hours engaged for the fourth quarter, but shares were sinking after the company disclosed a wider-than-expected net loss.
Roblox
(ticker: RBLX) reported a fourth-quarter net loss of $143.3 million, or 25 cents a share, while analysts surveyed by FactSet had forecast a net loss of 12 cents. Bookings, a form of adjusted revenue preferred by videogame analysts, rose 20% year over year to $770.1 million, a tick below Wall Street’s consensus estimate of $772 million.
The company said average daily active users were 49.5 million during the quarter, up 33% year over year. Hours engaged hit 10.8 billion, up 28%.
Roblox is a platform that provides users—predominantly children and teens—with tools to make their own games and online experiences. Users can visit worlds and play custom games with friends.
For the month of January, bookings are estimated to have been between $220 million and $223 million, the latter figure being a year-over-year jump of 3%. Daily active users were 54.7 million, up 32% from January of 2021, while hours engaged were 4.2 billion.
Roblox doesn’t provide investors with formal financial forecasts, but does release key metrics monthly.
Roblox
stock, which rose 7.2% to $73.30 in Tuesday trading, dropped 11% in extended trading following the report and was down almost 16% in the premarket on Wednesday.
Chief Financial Officer Mike Guthrie told Barron’s on Tuesday that the company is excited about how it is growing internationally and expanding its age demographic by adding older users. The firm believes those two trends will help it to hit a billion users when paired with a greater expansion of the platform.
“Over the last year, we’ve been seeing music on the platform, brand partnerships starting to grow, and early investments in education,” he said. “And in the sense that generally just drives a breadth of content on the platform, and, in simplest terms, [it] makes it more appealing to a broader array of people. So, as long as we keep delivering on those three things, I’m really, really comfortable.”
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