Roblox Corporation

Roblox Corporation NYSE
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May 182021

A dose of high fashion

Online gaming platform Roblox wants only the best for its customers, so the newly public company has kitted out the game with a brand new Gucci secret garden. Everyone loves a dose of high fashion, and prices rally over 8%. Fancy.

Gamers are getting a few weeks of high-flying fashion life as Gucci and Roblox launch a cool new collab. The gaming platform is now home to a Gucci-inspired virtual garden experience, which will take place alongside the real-life version in Florence in celebration of the fashion house’s 100th anniversary. When you enter the garden, you get a genderless, ageless mannequin to explore with, and Roblox has introduced a host of new accessories to get excited about.

We don’t partner with very many brands,

said Roblox exec Christina Wootton.

One thing that was very special when we started speaking with Gucci is that they took the time to understand our platform and what works well for designers and creators in our community.

Looks like the market agrees. Vogue.
May 122021

Roblox levels up

Roblox wows in its first post-debut earnings release, reporting revenue growth of 140% and pushing prices up a level with a 21% pre-results jump.

The global gaming platform beloved by teenagers everywhere made a supersonic debut only two months ago, soaring 54% on its first day of trading to close at $69.50 with a market cap of around $38 billion. It’s had a rocky ride since then, with its share price bouncing up and down like a basketball, but its latest earnings knocked it out of the park. Guess there’s not been much else to do recently.

The results saw revenues up 140% to $387 million and bookings (a form of adjusted revenue that analysts like to watch in gaming firms) up by 161% to $652.3 million, solidly outpacing initial forecasts of $573 million. Daily Active Users (DAUs) grew 70% from the same period the year before to 42.1 million, with players spending a mindblowing 9.7 billion hours on the platform, up by a massive 98% from March last year and logging over 230 hours per user. All that gaming led to an average booking per DAU of $15.48, up 46% from the same period the year before – note that because a lot of the platform’s content is free, DAU growth is important for Roblox to prove to investors how it monetizes its users.

The firm posted losses of $134.2 million for Q1 and a loss per share of $0.46, which missed expectations of earnings per share of $0.13, but investors still seemed happy with the results – the stock jumped over 21% on Tuesday in anticipation, and rose a further 5% in after-hours trading on Wednesday following the results. Looks like the pandemic really played into their hands.

“A fundamental part of being human is connecting with others, and we’re inspired by the way in which the Roblox community creates and shares experiences to play, work and even learn together,”

said CEO David Baszucki.

“The opportunity of what we’re building at Roblox is massive, and we will continue to make long-term investments as we build a human co-experience platform that enables shared experiences among billions of users.”

The platform, designated “crack for kids”, is already expecting a bumper second quarter and expects to log over $1.5 billion for the full year, so this could be a fun game to get in on. Overall, Roblox is up by about 17% since its $64.50 debut on March 10, closing on May 12 at $75.53. By comparison, the S&P 500 (SPX) is up 4.4% over the same period.

“Our first quarter 2021 results enabled us to continue investing aggressively in the key areas that we believe will drive long term growth and value, specifically hiring talented engineering and product professionals and growing the earnings for our developer community,”

said Roblox CFO Michael Guthrie.

“We believe we must continue to innovate and so remain focused on building great technology to make progress on our key growth vectors, primarily international expansion and expanding the age demographic of our users.”