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Roblox stock soars as Q3 results surpass expectations

"We are executing against our key priorities to enable deeper forms of immersion," said CEO David Baszucki
Roblox stock soars as Q3 results surpass expectations
  • Roblox reported bookings of $839.5 million for the third quarter of 2023, representing a 20% increase from the same period in the previous year

Online gaming platform Roblox has released its Q3 2023 earnings call, which shows that the company’s shares jumped over 11%, fueled by a third-quarter earnings report that outperformed expectations on both revenue and earnings and showcased impressive user growth.

Roblox reported bookings of $839.5 million for the third quarter of 2023, representing a 20% increase from the same period in the previous year. The company’s bookings metric includes both revenue recognised during the quarter and deferred revenue. In the year-ago quarter, bookings amounted to $702 million.

An impressive quarter

Roblox’s revenue is primarily driven by sales of its virtual currency, Robux, which players use in customising their avatars and acquiring additional in-game features. The company’s average Daily Active Users (DAU) also increased to 70.2 million in Q2 2023, a 20% increase from the previous year. In addition, over 16 billion hours were spent engaged with Roblox during the quarter, also representing a 20% year-over-year growth.

David Baszucki, founder and CEO of Roblox said, “Our strong third-quarter results reflect our continued platform innovation and growth across all age groups and geographies. We are executing against our key priorities to enable deeper forms of immersion, communication and Avatar expression on the platform, while investing in artificial intelligence, brands and advertising, to drive future growth.”

Despite its revenue growth, Roblox still reported a net loss of $277.2 million for the quarter ending September 30, 2023. While this represents a slight improvement from the net loss of $297.8 million reported in the same period last year, it highlights the company’s ongoing challenges in achieving profitability.

AI advances

“On the AI side, we continue behind the scenes to more and more incorporate AI up and down the stack,” said Baszucki. “We’re moving many of our moderation pipelines more and more to AI and this is simultaneously increasing quality as well as cost. And you can see that in our increased operating leverage,” he added.

In a letter to shareholders, Roblox highlighted the robust top-line growth in East Asia and Europe, underscoring the company’s expanding global reach. Recognising the need for fiscal discipline, Roblox has implemented measures to moderate its spending growth across key expense categories. It also noted its intention to start providing financial guidance in fiscal 2024.

This article originally appeared on BeyondGames.biz