Summer is over, so kids are back to school, and adults are back to their regular routines. Unfortunately, for companies like Roblox, which rely heavily on a younger demographic, this often means trouble for their business metrics.
The last time we spoke about Roblox was in August when the company reported lower-than-expected earnings and revenue numbers. In addition, its daily active users (DAUs) came in at 52.2 million, nearly a million less than expected. Since then, the stock has continued to fall with the rest of the market.
Today, the company released its September “report card,” so let’s take a look at how it did. 🧐
September’s daily active users (DAUs) rose to 57.8% million, up 23% YoY and hours engaged were also up 16% YoY to 4 billion. Yes, that’s a “B” as in “boy, that’s a lot of gaming.”
Additionally, its estimated bookings were up between 11%-15% YoY, or $212 and $219 million.
While all of these numbers fell from August, many had expected worse declines as children returned to school. 👍
From a stock perspective, short interest was roughly 6.20% of outstanding shares, marginally lower than its all-time high of around 7.2% in July. When you combine better-than-expected news with a rebounding market and high short interest; you get a squeeze.
And that’s exactly what’s happening today in $RBLX shares as they rally over 20%. 📈
There are two *schools* of thought regarding the stock’s longer-term chart.
Bullish technical analysts say the stock is “building” on its long-term bottom formation here by forming a higher low of support. 🐂
Meanwhile, bearish analysts say a downward-sloping 200-day moving average indicates the long-term trend is still down and should act as resistance as prices approach it. 🐻
Bulls clearly have the upper hand today, but who is ultimately right remains to be seen. While we wait, head over to the $RBLX stream and share your thoughts!