Sure, kids are playing games, or as Roblox calls them, “experiences.” However, they’re also developing, producing and selling these games. But “played the game” isn’t the right way to describe what kids are doing on Roblox. Roughly 54% of Roblox’s total user base is 13 or younger. More than half of Americans aged 16 and younger have played the game. It’s no secret that Roblox is aimed at kids. Roblox Pressured Us to Delete Our Video.Investigation: How Roblox Is Exploiting Young Game Developers.If you want a more detailed rundown of both issues, you must watch the following two videos: These are real concerns - especially for parents whose kids play Roblox.īut for these issues to impact Roblox’s stock price or business operations, it’d take action from parents, lawyers and/or politicians … which means they may or may not come to the forefront.īut if these two issues do gain traction … it’s gonna be very, very bad for Roblox. There are two critical issues I’m about to cover that are probably gonna make you mad if you’re an investor just for the sake of being an investor. If you’re into blissfully making money and investing without worrying about the potential social, legal or political consequences or fallout of a company’s operations … stop reading now. So, if you’re clamoring for anything and everything metaverse related, Wall Street just handed you a discount on one of the biggest metaverse plays on the Street right now. ARK Funds’ Cathie Wood certainly thought so, as the ARK Innovation ETF ( NYSE: ARKK ) bought 334,691 shares of RBLX following the sell-off. In fact, the 10% drop was probably a great buying opportunity.
If you are a Roblox bull, the company’s November update was no reason to sell.
More than likely, investors used this blip as an excuse to sell RBLX stock amid an overall decline in the market due to COVID-19, inflation and Federal Reserve monetary policy concerns. In other words, I think Wall Street’s 10% drubbing of RBLX stock based on this slight miss in DAUs is more than a bit absurd. It’s anecdotal, but this is how it would work in my house - if I let my kids play Roblox, that is. start to crop up and students get serious about school heading into the holiday break. Meanwhile, November is about the time when exams, midterms, quarterlies, trimester exams, etc. Roblox’s main users are aged 16 and younger, right? School starts back up in August (September for some), so there should be a slight expected dip in activity during the school season. I think there’s another explanation for the slowdown. Wall Street looked at these numbers and came to the conclusion that, despite rising 35% year over year, Roblox’s growth was slowing … and users were moving away from the platform. You see, analysts were expecting Roblox’s DAUs to rise to 50.5 million in November, not 49.4 million. So, what prompted RBLX stock to plummet 10%? Expectations. In the third quarter of 2021, Roblox users spent 11 billion hours on the platform. The company offers users the ability to play in virtual worlds and provides developers the means to create games and other entertainment experiences virtually online. Roblox operates an online, virtual entertainment space that’s exactly what experts describe when they talk about the metaverse. As I detailed in the November 27 issue of Great Stuff - 5 Stocks To Rule The Metaverse - Roblox is probably the purest metaverse play on Wall Street right now. Activision-Blizzard and Electronic Arts wish they had these kinda growth numbers. That, Great Ones, is a veritable $^%&-ton of growth.
Revenue rose 84% to 87%, reaching between $184 million and $187 million.Bookings rose 22% to 24%, reaching between $208 million and $211 million.Daily active users (DAUs) were up 35% year over year to 49.4 million.I’m not gonna lie, the sheer levels of growth within the company’s update were astounding: On Wednesday, December 15, RBLX stock plunged more than 10% after Roblox released its November update.