Roblox Corp (RBLX)

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Roblox shares tumble on wider-than-expected loss
By: Investing.com | November 9, 2022

Roblox Corp (NYSE:RBLX) shares tumbled early Wednesday following the company's third-quarter earnings release, which saw it miss analyst consensus estimates.

The online game platform reported a loss per share of $0.50, $0.20, worse than the analyst estimate of a loss of $0.30 per share. In addition, revenue for the quarter came in at $517.7 million, 2% year over year, and below the consensus estimate of $690.79M.

Roblox shares are down more than 9% at the time of writing.

Bookings came in at $701.7M, up 10% year over year, while average daily users grew to 58.8M, up 24% compared to last year. Meanwhile, the company said hours engaged increased by 20% to 13.4 billion, while average Bookings per DAU was $11.94, down 11% year over year.

"We are pleased with the third-quarter growth in users, engagement and bookings, which demonstrates the significant progress we are making on key platform initiatives such as aging up and international growth," said Michael Guthrie, Chief Financial Officer of Roblox. "At the same time, we are continuing a disciplined capital allocation strategy focused on maximizing long-term shareholder value."

Reacting to the report, Citi analysts said Roblox's Q3 bookings, Adjusted EBITDA, average bookings per DAU, and DAUs were generally in line with or better than consensus.

"3Q22 revenue finished below the Street, partially driven by a $110 million headwind related to a change in the company's estimated paying user life (which we view as a positive for the company)," wrote the analysts. "We are a bit surprised by the weakness in the shares this morning based on these 3Q results (and October trends)."

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