Roblox has made building so easy that a child can do it. Unfortunately, building a profitable existence as a publicly-traded entity has proven to be a much harder task. 🤷
Strong growth throughout the pandemic set the bar too high for its comparable numbers. As a result, its earnings reports this year have left a lot to be desired. In September, however, its usage data picked up and signaled that its business could be starting to stabilize.
However, today’s mixed Q3 earnings report wasn’t enough to satisfy investors. 👎
The company reported a $0.50 loss per share, which exceeded the $0.35 loss expected by analysts. Revenue of $702 million did beat expectations of $686 million.
Where it ran into trouble was its average bookings per daily active user fell 11% YoY to $11.94. So despite its average daily active users ticking up 24% YoY and up 6.6 million from the second quarter, it’s making less money per user. 🔻
And in this environment, the market is not allowing much room for error. Even companies that beat expectations and have decent guidance are being taken to the woodshed.
As a result, $RBLX shares fell another 21% today as investors digested the news. 📉
