A man photographs a Roblox banner displayed to celebrate the company’s IPO on the front facade of the New York Stock Exchange (NYSE) in New York, March 10, 2021.
Brendan McDermid | Reuters
Shares of Roblox closed up 15.7% on Thursday after the gaming company released business update for November which showed a slowdown in growth and a decline in how much it earns from its daily users.
The company said expected bookings were between $222 million and $225 million for the month. This is a growth of 5% to 7% on an annual basis. But in November 2021, Roblox said expected bookings during the same period were up 22% to 24% year over year. Roblox said the strength of the US dollar against the euro and the British pound had affected its business.
Roblox calls its revenue bookings. The company generates revenue from sales of its virtual currency called Robux, which players use to dress up their avatars and buy other premium in-game features.
Roblox’s average bookings per daily active user were between $3.92 and $3.97, down 7% to 9% from a year ago.
Total daily active users increased 15% from November 2021 to 56.7 million users, but last year the company reported growth of 35%.
Roblox’s update comes amid broader weakness in the video game industry. Last month, Take-Two Interactivethe company behind games like Grand Theft Auto cut its outlook for the current quarter and for fiscal 2023, blaming “current macroeconomic conditions.”
“Our lowered forecast reflects changes in our process, currency fluctuations and a more cautious view of the current macroeconomic backdrop, particularly in mobile,” Take-Two CEO Strauss Zelnick said in a Nov. 7 statement.
In October, An apple also warned of weakness in digital advertising and gaming when it reported fourth-quarter earnings. “Specifically on services, we expect to grow but be impacted by the macroeconomic environment increasingly affecting foreign currency, digital advertising and gaming,” Apple Chief Financial Officer Luca Maestri said during the company’s latest earnings call. the company.
Shares of Roblox are down about 73% year-to-date.