Game developer Roblox became the latest company in the video game industry to report a slowdown in growth, with a drop in a closely watched sales metric triggering a share price tumble in after-hours trading.
The company, whose eponymous platform helps players design their own games, went public through a direct listing in March 2021, a time when many children were spending more time at home on screens due to pandemic-related restrictions.
As those restrictions have been relaxed, the pandemic-fuelled boom for game developers has waned. This month, Call of Duty maker Activision Blizzard reported sales in its most recent quarter had dropped, while Take Two Interactive, maker of the Grand Theft Auto series, forecast adjusted sales for the full year that missed analysts’ expectations.
Roblox on Tuesday reported revenue was up 30 per cent from a year ago to $591.2mn in its second quarter. But the company also reports “bookings” — a figure adjusted for deferred revenue and which measures sales of Robux, the game’s virtual currency that users spend to customise their avatars.
Bookings were down 4 per cent from a year ago to $639.9mn, missing Wall Street expectations by almost $5mn.
The company reported a 21 per cent yearly increase in daily active users to 52.2mn, but the average bookings per active user fell by 21 per cent, down to $12.25.
The San Mateo-based company’s net loss of $176.4mn was wider than a year earlier and wider than what analysts expected.
Roblox shares fell 17 per cent in after-hours trading to $39.36 on Tuesday, leaving them down more than 40 per cent since the closing price of almost $70 when the direct listing took place in March 2021.
Source: Financial Times