Roblox Corporation (NYSE: RBLX) stock plummeted 22% in intraday trading Thursday following underwhelming first-quarter results and guidance.
Roblox (NYSE: RBLX) recently released its first-quarter financial results, falling slightly short of analyst estimates for revenue and bookings. Despite substantial year-over-year revenue growth, the company reported a net loss nearly identical to that of the previous year.
The company generated revenue of $801.3 million in the first quarter, narrowly missing estimates compiled by Visible Alpha of $806.2 million. This represents a 22% increase from the $655.3 million reported in the first quarter of 2023. Average daily active users, a critical metric for online games, reached 77.7 million for the quarter, reflecting a 17% increase compared to the year-ago period.
Despite the revenue growth, Roblox reported a net loss of $270.6 million for the quarter, equivalent to 43 cents per share, narrower than analysts’ expectations of $308.4 million. This loss was nearly identical to last year’s figure of $268.3 million, or 44 cents per share.
In a letter to shareholders, the company acknowledged that while daily active users and hours engaged showed year-over-year growth, engagement experienced an unseasonal decline for much of the first quarter across various regions, ages, and platforms.
Moreover, Bookings, another key metric for the company, reached $923.8 million for the first quarter, reflecting a 19% increase from the previous year but falling short of analysts’ expectations. Bookings include revenue from the sale of virtual currency, subscriptions, and one-time purchases like gift cards.
Looking ahead, Roblox provided conservative guidance for bookings, estimating $870 million to $900 million for the second quarter and $4 billion to $4.1 billion for the full year. These projections fell below analysts’ expectations of $939.1 million for the second quarter and $4.2 billion for the full year.
Roblox (NYSE: RBLX) Stock Price Action
RBLX stock plunged 22.06% to close at $30.42 on Thursday. Its value decreased by 18.53% this week. Trading activity has witnessed 69,831,876 (69.83 million) shares changing hands, well above the average daily volume of 7.01 million.
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