🔮 Better than the Oracle? Our Fair Value found this +42% bagger 5 months before Buffett bought itRead More

Roblox shares tumble following 'disappointing' November metrics

Published 12/15/2022, 10:42 AM
Updated 12/15/2022, 10:46 AM
© Reuters Roblox (RBLX) shares tumble following 'disappointing' November metrics

By Sam Boughedda 

Roblox (NYSE:RBLX) shares tumbled in early Thursday trading after the company reported its key metrics for November, with the company impacted by foreign exchange headwinds.

Roblox shares are down almost 15% at the time of writing.

"The strengthening of the US Dollar against the Euro, British Pound, and other foreign currencies during 2022 has had an adverse impact on bookings. We estimate that the impact of foreign currency fluctuations led to a reduction of approximately 4-5% in the year-over-year growth rate for November bookings," Roblox said in its report.

The gaming platform's estimated bookings were between $222 million and $225M, up 5% to 7% year-over-year, with its estimated average bookings per daily active user between $3.92 and $3.97, down 7% to 9%.

Meanwhile, daily active users came in at 56.7M, up 15%, and hours engaged rose 10% to 3.9B, with estimated revenue between $190M and $193M, rising from 1% to 3% year-over-year.

Reacting to the report, Benchmark analysts said Roblox "reported disappointing November key performance indicators; we are not surprised."

"We believe RBLX's video game platform is vulnerable to current and emerging negative macroeconomic trends including inflation, unemployment, and wealth reduction. We are astonished over RBLX's decision to continue elevated investment spend that should exaggerate a significantly challenging operating environment and deteriorate free cash flow," said the analysts, who have a Sell rating and $21 price target on the stock.

"We see continued execution risk on both revenue growth and profitability. RBLX remains painfully expensive in our view, with meaningful room for further valuation deterioration. We think a lack of clear vision and discipline have challenged CEO."

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.