Not So Wonderful News From Roblox's Digital Wonderland

On April 17th, Roblox Corporation RBLX saw its shares tumble 12% upon reporting its key metrics for March as the video game developer revealed that average bookings per daily user are expected to drop on a YoY basis.

March Key Metrics

Daily active users (DAUs) declined 1.1 million from February as they amounted to 66.2 million, but this is an increase of 26% from last March. Engagement amounted to 4.8 billion hours which is an improvement from February’s 4.6 billion. The March report will be the last monthly breakdown of key metrics as Roblox will be providing updates on a quarterly basis.

Roblox reported bookings to be in the range between $247 million and $255 million which translates to a YoY rise of 23% to 27%, with revenue being in the range between $212 million and $223 million. For Roblox, revenue equates to figure bookings as it comes from sales of its virtual currency called Robux, which players use to buy features in games and dress up their avatars. The average bookings per daily active user is seen at about $3.79. 

Fight For The Gaming Throne

Along with Fortnite, Roblox dominates the gaming universe. These two players are biggest in the space. Epic Games is also betting big with its Chief Creative Officer teasing a collaboration with The Last of Us. The new system to pay Fortnite creators that Epic Games created promises to disrupt the game’s ecosystem. The Creator Economy 2.0 that Epic Games introduced entails that Epic Games will be paying out 40 percent of Fortnite’s net revenues each month to creators based on how much players engage with their islands.

Upgrade From Jefferies

The Wall Street upgraded Roblox from hold to buy, reflecting its confidence that the online gaming platform will continue to show strong growth in spite of macro pressures. Shares climbed 2.9% after this upgrade. Roblox shares are up more than 60% year to date.

Roblox Is One Of First Creators Of The Metaverse

Many experts regard Roblox as one of the first official “metaverse” platforms with Nike Inc’s NKE going all in this digital direction with its Nikeland micro-metaverse that is built on Roblox’s platform. While the abilities provided by this digital wonderland are yet to be fully explored, Nike is already doing a great job in creating immersive experiences for its consumers passionate about sports and gaming, providing them with much more than just games as it allows them to try on virtual Nike products through their avatars. With Roblox’s tech power, Nike gained a valuable opportunity to connect with its consumers on a new level. While Nikeland is still a new habitant of the metaverse, it has achieved phenomenal results so no wonder that Nike has clearly stated that it will be playing an important part in its future marketing and branding strategies. 

Imagining A World Where AI Can Make Anyone Into A Gaming Creator 

Back in March, Roblox launched its first generative AI creation tools that make the creation process less tedious. Although these first AI tools are far from perfect, it’s the first step in helping users create codes. 

Therefore, it’s safe to say that despite Roblox’s duels and harsh rules of the games it plays, it will undoubtedly play an important part in defining the future of the gaming industry. 

DISCLAIMER: This content is for informational purposes only. It is not intended as investing advice.