Roblox - Back from the dead?
On the big picture, the company did well in Q1'21 to reaffirm some confidence after 2 successive quarters that were under satisfaction.
Here are some key points to take note of, even though the big picture seems good.
1. Revenue growth YoY is 22%
Roblox managed to eke out some growth in Q1'23 after just growing 2% in Q3'22 and Q4'22 YoY.
Even though the topline growth seems impressive, do take note net losses widened, cause mostly by increased research and development and infrastructure and trust & safety.
2. Daily Active Users (DAUs) increase, but not bookings per DAU
Apps that users get glued to need to show stable DAU growth. And this part Roblox has successfully done so. But apart from platforms like YouTube by $Alphabet-A(GOOGL.US$ and Facebook & Instagram by $Meta Platforms(META.US$, apps like Roblox need to earn from users paying money.
This aspect is called the bookings per DAU.
And for this aspect, Roblox didn't do well.
Average bookings per DAU is flat, implying that users are not spending more on Roblox even though DAUs increased.
3. Back to positive free cash flow
Another silver lining is that Roblox returned back to positive free cash flow after experiencing negative free cash flow for successive 3 quarters.
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The information available in this article/report/analysis is for sharing and education purposes only. This is neither a recommendation to purchase or sell any of the shares, securities, or other instruments mentioned; nor can it be treated as professional advice to buy, sell or take a position in any shares, securities, or other instruments. If you need specific investment advice, please consult the relevant professional investment advice and/or for study or research only.
The information available in this article/report/analysis is for sharing and education purposes only. This is neither a recommendation to purchase or sell any of the shares, securities, or other instruments mentioned; nor can it be treated as professional advice to buy, sell or take a position in any shares, securities, or other instruments. If you need specific investment advice, please consult the relevant professional investment advice and/or for study or research only.
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