Roblox announced earnings yesterday and basically missed on all fronts.
Revenue was $568MM, which was up 83% YoY and 12% QoQ
Unfortunately, expectations were significantly higher
Without rehashing everything you can read from the standard release, basically they disappointed on all levels.
Some of this is clearly a deceleration from the huge platform growth during the pandemic.
2021 YoY and QoQ revenue growth Q1 Q2 Q3 Q4 YoY 139% 127% 102% 83% QoQ 25% 17% 12% 12%
Definitely not the trend you want to see, but I think the larger question is whether or not this is a permanent deceleration from a one-time surge (i.e. Peloton/Zoom). On that front, I think Roblox is in a much better position.
Roblox is not a video game, but a development platform where users can interact. It’s not a “pie in the sky” vision like Meta’s metaverse that lost $10 billion last year. It grew from a pretty simple design (similar to Minecraft) and they are now in a phase of developing much more compelling (and hopefully profitable) content. As an example, in December, Roblox announced a deal with the NFL for users to virtually build a stadium and manage their own team.
One item in the report was positive. DAU (daily active users) fell short in Q4, but the reported number for January appears user growth has picked up. Last Q1 also showed a significant growth in QoQ DAUs. All the same, strong user growth does suggest the platform remains compelling.
2021/2 DAU (millions) and QoQ growth Q1 Q2 Q3 Q4 Jan22 DAU 42.1 42.3 47.3 49.5 54.7 QoQ 13% 3% 9% 5% 11%
In the end, a disappointing quarter, but I don’t think the story is over.