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Earnings Results: Roblox stock drops as bottom-line results, bookings fall short of Street expectations

Roblox Corp. shares dropped after hours Tuesday, following a healthy gain in the regular session, as the social-gaming platform reported quarterly results that fell short of Wall Street expectations.

Roblox 
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shares dropped as much as 16% after hours, following a 7.3% surge in the regular session to close at $73.31.

The company reported a fourth-quarter loss of $143.3 million, or 25 cents a share, compared with a loss of $58.7 million, or 30 cents a share, in the year-ago period. Roblox began trading as a public company in March and has about 581 million shares outstanding compared with the year-ago quarter’s 195 million shares.

Revenue rose to $568.8 million from $310 million in the year-ago quarter, while bookings grew to $770.1 million from $642.3 million in the year-ago period.

Analysts, on average, had forecast a loss of 12 cents a share on bookings of $772 million. FactSet’s Wall Street consensus for revenue compares against Roblox’s reported bookings.

The company defines bookings as “revenue plus the change in deferred revenue during the period and other non-cash adjustments.” The importance of bookings comes into play as the company sells virtual currency on its site that may be considered deferred revenue.

Read: The Roblox non-IPO: 5 things to know about the tween-centric gaming platform’s direct listing

Average daily active users, or DAUs, were 49.5 million, up 33% from the same year-ago period. For January, Roblox said DAUs rose 32% to 54.7 million from a year ago.

“With nearly 55 million daily active users, Roblox is increasingly an integral part of people’s lives,” said David Baszucki, Roblox chief executive, in a statement. “As we look ahead to 2022, we will continue to develop our technology to enable deeper forms of communication, immersion and expression on our platform.”

“The foundation we put in place that allows us to invest in our business while continuing to generate strong cash flow is one of the most unique aspects of our business,” added Michael Guthrie, Roblox chief financial officer, in a statement. “Our 2021 results demonstrate that the investments we were able to make in our technology and developer community are generating strong returns, and we will continue leaning into the business as we focus on the large, long-term growth opportunity ahead of us.”

Roblox reported free cash flow from operations of $558 million in 2021, compared with $411.2 million in 2020.

In November, Roblox shares rallied after the company reported strong results despite a three-day outage around Halloween.

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