Roblox fell 15% after hours after earnings report


$Roblox Corporation(RBLX)$‌closed at $73.30 at 4pm (EST) but fell ‌15% during after hours after the earnings disappoint.





Roblox creates game platform where players can create their own worlds, allowing interaction, play in the metaverse.  Roblox sells virtual currency to players to purchase digital items in the game. Roblox has deals with several big brands like Nike and NFL.




From the latest earnings, EPS came at a loss of 0.25 whereas the forecast is 0.1369.  For the revenue, the forecast was $763.29M but actual was $568.77M, a significant miss for both EPS and revenue.


The following highlights are extracted from their website:


Fourth Quarter 2021 Financial Highlights

Revenue increased 83% over Q4 2020 to $568.8 million

Net cash provided by operating activities of $122.2 million; Free cash flow was $77.3 million

Bookings increased 20% over Q4 2020 to $770.1 million

Average Daily Active Users (DAUs) were 49.5 million, an increase of 33% year over year

Hours Engaged were 10.8 billion, an increase of 28% year over year

Average Bookings per DAU (ABPDAU) was $15.57


Full Fiscal Year 2021 Financial Highlights

Revenue increased 108% over fiscal year 2020 to $1.9 billion

Net cash provided by operating activities of $659.1 million; Free cash flow was $558.0 million

Bookings increased 45% over 2020 to $2.7 billion

DAUs were 45.5 million, an increase of 40% year over year

Hours Engaged were 41.4 billion, an increase of 35% year over year

ABPDAU was $59.85


January 2022 Key Metric Estimates

Revenue was between $203 million - $206 million, up 64% - 66% year over year

DAUs were 54.7 million, up 32% from January 2021

Hours engaged were 4.2 billion, up 26% year over year

Bookings were between $220 million and $223 million, up 2% - 3% year over year

ABPDAU were between $4.02 - $4.08, down 22% - 23% year over year


While there were some good news on increased hours of engagement, revenue and bookings increase.  It remains of concern that the the company continued tosuffer losses.  In fact, they have never met their EPS target and met/exceed revenue target twice since Q2 2021.


What to do with Roblox?




As the 1H chart above, there was a big drop following the disappointing news.  It would take a few days to bottom up from this drop and it is best to wait for few days/weeks before considering taking up a LONG position in this company.  Personally, I would prefer to observe the company from the side till they are able to demonstrate profitability in the coming earnings.  The company will need to improve both sales and manage their costs better to get into the black.


@TigerStars

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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  • CY Tan
    ·2022-02-18
    A big drop after hours. Will it recover in near term?
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    • KYHBKO
      will take a while
      2022-02-19
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  • jat
    ·2022-02-17
    i jus don't know how to trust my money in a kids' game ha ha ha ;)
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    • KYHBKO
      we can observe from the side.
      2022-02-17
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  • Mister Makam
    ·2022-02-17
    not surprised. the market is going to be brutal about any result that does not show increase in earnings
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    • KYHBKO

      good point

      2022-02-17
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  • Tulip123
    ·2022-02-18
    I play Roblox 
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    • KYHBKOReplying toTulip123
      thanks for sharing. happy investing
      2022-02-18
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    • Tulip123Replying toKYHBKO
      I play because of my son. I feel there are definitely some interesting games. We play everyday. My son told me to invest in this stock. I may consider if I have extra 💰..haha
      2022-02-18
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    • KYHBKO

      how is your experience with the game?  Do you rate this highly?

      2022-02-18
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  • Samlunch
    ·2022-02-19
    A rare miss by pelosi
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    • KYHBKO
      think that the market sentiment is much weaker than anticipated.
      2022-02-21
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  • 木子一休
    ·2022-02-18
    Great ariticle, would you like to share it?
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    • KYHBKO
      please feel free to share
      2022-02-18
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  • MoneyFace168
    ·2022-02-18
    Is the the price to enter yet?
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    • KYHBKO

      Would wait a while more.

      2022-02-18
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    • MoneyFace168
      Care to share your comfortable price?
      2022-02-18
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  • yinghao94
    ·2022-02-17
    damnn... market is pretty pessimistic right now
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    • KYHBKO
      yes, with the Ukraine situation, interest rate hike and pandemic. oil price near record highs did nothing to help.
      2022-02-17
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  • MoneyCentral
    ·2022-02-17
    No one is spared. Although the general downward declines hit their lows, if company doesnt perform, stock gets whacked. Look at $NVIDIA Corp(NVDA)$ which seemingly defied gravity for so long…
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  • ThunderPat
    ·2022-02-17
    Fundamentally, it seems strong. I think it should sail through the storm of uncertainty. Thank for sharing
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  • Mr Charles
    ·2022-02-18
    please like
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  • luckyone
    ·2022-02-17
    an interesting share that I will keep a lookout for
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  • EdwinKhoo
    ·2022-02-17
    good to go in now
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  • StaQ
    ·2022-02-17
    the industry have so much competition.  really need a very strong and unique differentiator.
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  • chester音響
    ·2022-02-28
    falling short could mean investors made an early withdrawal from market ?
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  • 叫我發先生
    ·2022-02-26
    Huathuat, pls givee me a like
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  • Dazza7
    ·2022-02-22
    Probably gonna keep an eye on this stock the next few days to determine whether to buy or avoid
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  • 小胖虎虎
    ·2022-02-22
    [财迷] [财迷] [财迷]
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  • Joelchua
    ·2022-02-20
    Still a far distance away from fundementals i feel
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  • MTamil
    ·2022-02-19
    👌🏻👌🏻👌🏻👌🏻
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