What caused the sharp growth of Roblox shares
On Tuesday, Roblox’s (ROBLOX) shares soared 42% after the famous video game development company delivered strong third-quarter results.
Roblox revenue grew 102% year-on-year to $509.3 million. At the same time, the number of company orders – a key indicator that considers deferred revenue and represents the amount of virtual currency in dollars that users bought during the quarter – jumped by 28% to $637.8 million.
rapid growth was an increase in the average number of daily active users by 31% to 47.3 million people and an increase in the number of hours spent by users in the service by 28% to 11.2 billion. “User engagement is our guiding light–” CEO David Bashuki said in a press release. –We are happy that in the third quarter, people of all ages from all over the world decided to spend more than 11 billion hours in Roblox.” Nevertheless, Roblox is not yet a profitable company. Its net loss for the quarter was $74 million.
However, the fast-growing company is already generating positive free cash flow – it has reached $170.6 million. As a result, the results of Roblox turned out to be particularly impressive in light of the easing of restrictions associated with the coronavirus, thanks to which children were able to return to school and resume active recreation.
Our key indicators – the number of active users, the hours spent by users on the platform, and the order portfolio – showed significant growth compared to the last. However, the restrictions related to Covid are, and children are returning to school, said CFO Michael Guthrie.
If the positive trends continue – which seems likely – Roblox shareholders will enjoy even more significant growth. “It is obvious that even when users return to their usual pre-pandemic lifestyle, Roblox remains an important part of their day,” the company said in a letter to investors.
