Roblox experienced a loss in the last 6 months of 22.11%. This is despite an all-time high in the number of users. The company profits have slid due to huge investment – making fans wonder if a proper metaverse experience is on the way.
For the last 3 months ending in June, Roblox’s losses came in at $176m. This figure has increased by 25.91% from last year’s quarterly loss – $140m.
“The increase in losses occurred due to increased costs to support business growth,” explained Roblox.
The company faced shareholders with the promise that they are heavily investing in the future of the company. Roblox’s spending spree on property and equipment in 2022 was came in at a cool $135m. Last year, the bill was a mere $45m.
Roblox Chief Business Officer Craig Donato said the company is investing in employees, increased server capacity, and global data centers.
“We’re very much in investment mode, and that’s going to put a little bit of drag on earnings, but these are investments that are the right investments for us to make. They will pay off in a three-to-five-year timeframe.”
Another factor dragging on profits is that the company changed user life from 23 months to 25 months in the second quarter. This resulted in a decrease in recognized revenue of $40m.
It has been suggested that Roblox was one of the first successful early metaverses, alongside Minecraft, in theory. Donato says, however, that they are in the very early days, with interoperability between metaverses and full immersion still not here yet.
“There’s so much more, when we think about where we are in the metaverse journey, we’re probably somewhere in the first inning. Right now we’re just building the stack. We’re all building the stack.”
Roblox have long been partnering up with with commercial partners such as Gucci whereby big brands create experiences for Roblox fans in their own branded worlds. They even have paired up with Spotify for a music world. It all seems rather Metaverseish.
Roblox Bookings are Up
Roblox calls the sales of its virtual currency – Robux – ‘bookings.’ Players use Robux to buy digital items like avatars and premium features.
The company’s revenue in the last quarter from bookings increased significantly. From $841m in the first half of last year, it soared 34.15% to a level of $1.12 billion in June. This is still down compared to the same period last year which amounted to $1.31 billion.
Daily Active Users
While revenue is down, the total daily active user (DAU) of Roblox is going gangbusters. In July, Roblox’s DAU hit an all-time high (ATH) to 58.5 million users. This was thanks to kids being locked up during the pandemic, right across the world.
Roblox’s Chief Executive Officer (CEO), David Baszucki, said the company continues to drive users and engagement globally. The aim is to expand the penetration of Roblox in all age groups and countries.
“On the vision side, our layered clothing system is just a first step to very highly personalized avatars across the platform. Our voice system is rolling out and is a great sign of really the future of how people will communicate on platforms like Roblox. And our physically-based material system is widely acclaimed by our developers as the next step in taking Roblox to a more realistic look and feel. Finally, I want to highlight that we continue to work on innovative, immersive native monetization systems, and we do expect to be rolling out a test of our immersive advertising system sometime later this year.”