Roblox shares fall on disappointing earnings and bigger-than-expected losses
On Tuesday, Roblox shares fall shares fell about 10% in extended trading after the children’s video game company released first-quarter results short of analysts’ expectations.
Here’s how the company does it:
- Gain: A loss of 27 cents versus a loss of 21 cents as analysts expected, according to Refinitiv.
- Revenue: $631.2 million versus $645 million, according to analyst estimates, according to Refinitiv.
- The sales figure is what Roblox calls accruals, including quarterly sales and accrued earnings.
Sshares fall are down 3% for the quarter, which is how much Roblox’s business has cooled since the pandemic as kids stay home and spend more time in front of their screens. Roblox generates revenue from its virtual currency, Robux, which players use to dress up their avatars and purchase other premium in-game features.
Roblox reported an average of 54.1 million daily active users in the first quarter, up 28 percent year-on-year but below StreetAccount’s consensus of 55 million. Consumers spent 11.8 billion hours on Roblox; the company said, a 22% increase.
Average daily orders by active consumers fell 25% to $11.67. Analysts polled by StreetAccount were expecting $11.65.
Roblox experienced a more than 200% surge in bookings that closed schools and offices during the pandemic. Stocks were scorching in 2021 after the company’s direct listing in March. The store started trading at $64.50 and briefly surpassed $134 in November when the Nasdaq peaked. Roblox’s market cap is $80 billion.
The anger subsided as the economy began to reopen. And this year’s pullout has had a significant impact on up-and-coming public companies like Roblox. The gaming platform shares more than 80% of its all-time high.
The company expects to have provisions of $221 million to $224 million in April, down 8% to 10%.
“While Covid and subsequent reopenings have helped slow the growth of some of our indicators, based on third-country data, we believe we are factoring in the consumer and hour share of some of the other gaming and social media companies that have our consumers’ attention. ” Roblox said in a letter to shareholders.