Roblox Jumps 28% on Lower-than-Feared Q3 Loss, Bookings Rise

Shares of Roblox Corporation (RBLX) jumped 28.2% in the extended trading session on Monday after the American video game developer reported a smaller-than-expected loss for the third quarter of 2021 on the back of better-than-estimated bookings.

The company reported a loss of $0.13 per share against analysts’ loss estimates of $0.14 per share. The company had reported a loss of $0.26 per share in the same quarter last year.

Bookings came in at $637.8 million in the quarter, up 28% year-over-year, and beat analysts’ expectations of $618.8 million. Average Daily Active Users (DAUs) stood at 47.3 million, up 31%.

Meanwhile, total revenue of $509.3 million missed the Street’s estimate of $636.53 million but grew 102% year-over-year. Additionally, adjusted EBITDA stood at $135.7 million during the quarter, compared to $161 million in the prior-year quarter. (See Roblox stock charts on TipRanks)

During the quarter, Roblox experienced a platform-wide outage from the afternoon of October 28 through the afternoon of October 31. As per the company’s estimations, lost bookings during the outage were $25 million. Additionally, there were $6 million of bookings received during the outage for which the company’s developers were not compensated, for a total of $31 million. Consequently, the estimated earnings loss for the developers during the outage stood at $6.8 million.

CEO Comments

In response to the third-quarter results, the CEO of Roblox, David Baszucki, said, “Engagement is our north star. We’re very pleased that during the third quarter, people of all ages from across the globe chose to spend over 11 billion hours on Roblox. We are happy to report that the developer community earned over $130 million in the quarter and is on pace to earn well over $500 million this year. As we finish 2021 and head into 2022, we will continue to invest in innovative technology to enable our developer community to do what they do best – build and create.”

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Wall Street’s Take

The rest of the Street is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on 5 Buys, 1 Hold and 1 Sell. The average Roblox price target of $89 implies 15.58% upside potential from current levels. Shares have gained 10.8% over the past year.

Bloggers Weigh In

TipRanks data shows that financial blogger opinions are 80% Bullish on RBLX, compared to a sector average of 71%.