Investors are feeling worried about the value of Roblox Corp’s stock after recent earnings reports suggested a bleak future.
Specifically, the stock fell after the Roblox makers reported some pretty strong revenue growth, but some categories of growth were much lower-than-forecast for 2021. That dented the company’s losses. company increased compared to the same period last year.
In the three-month period ending December 31, 2021, Roblox Corp earned $568.8 million in revenue, up 83 percent year-on-year in 2020. But experts found that growth slowed. throughout 2021 and much slower growth in January 2022 is a problem for Roblox Corp.
The report also said that the average daily user count increased 32% to 54.7 million last month, but Roblox’s lack of support should make the situation worse.
During the same quarter, Roblox Corp lost about $140 million, up significantly from the $69 million it lost in the fourth quarter of 2020. Similar trends followed the company’s full-year results. In 2021, revenue grew 108% to $1.9 billion.
What slows down the company’s revenue growth? Roblox’s target audience is children and teenagers, who are returning to school and reducing their gaming frequency. CEO David Baszucki took to CNBC to talk about the company’s performance, saying that there are untapped revenue streams, so many numbers are unaccounted for.
According to Reuters, in the fourth quarter, Roblox fell slightly below analyst expectations. They had forecast earnings of $772 million, not $770 million. Roblox also posted a much larger loss per share of $0.25 per share (compared to the $0.13 Wall Street analysts had expected).
At the close of trading, Roblox stock closed at $73.3 per share. However, during the extended trading period, it fell almost 20% to $62.1.