Roblox shares close up more than 40% after a solid earnings report.
IMPORTANT NOTES
- Roblox’s stock jumped 42.2 percent on Tuesday.
- After the bell on Monday, the business disclosed third-quarter financial results that were better than anticipated.
Roblox stock rose 42.2 percent on Tuesday, a day after the video game firm posted solid third-quarter earnings.
Investors seem to be thrilled with the company’s good October results, rather than the complete third quarter ended Sept. 30, since they may foreshadow what’s to come in the fourth quarter.
“Historically, October has been the lowest month of the fourth quarter, giving more confidence around our fourth-quarter expectations,” Stifel analysts said in a report Monday.
During the first 27 days of October, Roblox reported a 43 percent growth in average daily active users year over year. During that time, the firm also claimed high levels of engagement. However, the game was unavailable between October 28 and October 31.
Nonetheless, Roblox outperformed Wall Street in terms of sales or bookings.
Roblox reported $637.8 million in bookings, a 28 percent increase year over year, compared to a projected $636.5 million. Revenue excluding deferred revenue was $509.3 million, a 102 percent increase year on year.
In the third quarter, Roblox had more than 47.3 million average daily active users, up 31 percent year over year and up from 43.2 million in the second quarter.
“It’s evident that even when users return to pre-pandemic patterns and behaviors, Roblox remains a vital part of their day,” executives stated in a shareholder letter.
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