Roblox Corporation (NYSE:RBLX) shares are trading lower Friday after the company reported second-quarter earnings on Thursday after the market closed.

Roblox Beats Estimates with User Growth Despite $185M Loss

Roblox reported a loss of 26 cents per share, beating the consensus estimate of a 30 cent-loss. In addition, Roblox reported revenue of $1.55 billion, inline with the consensus estimate.

Average daily active users reached 123 million, up 10% year-over-year, while hours engaged rose 5% to 29 billion. Average monthly unique payers grew 15% to 27 million, and bookings increased 8% year-over-year to $1.6 billion. The company reported a consolidated net loss of $185 million.

“We remain focused on capturing 10% of the global gaming market and an even greater share in the U.S. Q2 delivered year-over-year gains in users and hours, following last year’s incredible growth,” said David Baszucki, founder and CEO of Roblox.

What to Expect in Q3

Roblox expects third-quarter revenue of $1.41 billion to $1.49 billion. The company expects third-quarter bookings to decline 14% to 18% year-over-year.

For the quarter, the company projects operating cash flow in the range of $110 million to $175 million and free cash flow in the range of $(60) million to $5 million, reflecting previously disclosed back-half loaded capital expenditures. These expectations also include about $40 million year-over-year working capital headwind, driven by the timing of creator payouts.

Analyst Consensus & Recent Actions

The stock carries a Buy rating with an average price forecast of $66.42. Recent analyst moves include:

  • Needham: Buy (Lowers Target to $50.00) (July 31)
  • BTIG: Downgraded to Sell (Target $30.00) (July 31)
  • Deutsche Bank: Downgraded to Hold (Lowers Target to $38.00) (July 31)

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Roblox Shares Crash

RBLX Price Action: At the time of publication, Roblox shares are trading 20.69% lower at $38.60, according to data from Benzinga Pro.

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