Roblox stock dropped over 21% Thursday morning after the video game platform released a disappointing outlook for the coming months.
The California-based company reported a net loss of $270.6 million, or 43 cents per share, for the current period. This is compared to a loss of $268.3 million, or 44 cents per share, in the same period last year. Wall Street’s analysts predicted a per-share loss of 53 cents.
The revenue increased by 22.3% to $801.3 million, falling short of the expectation of $918.8 million. Its bookings rose by 19% to $923.8 million, just missing expectations of $930.4 million.
The company expects bookings of $885 million in the second quarter, which is lower than the estimate of $929 million. For the entire year, Roblox has forecasted bookings of $4.05 billion, which fell short of the expected target of $4.18 billion.
However, the company’s daily active users increased to 77.7 million in the first quarter, a 17% YoY increase, surpassing analysts’ expectations of 77.3 million.
“Our teams have been hard at work identifying opportunities to drive DAUs (daily active users), hours, and bookings growth rates back to 20% year over year,” said Chief Executive David Baszucki.
He mentioned that the company is testing changes in the AI-powered discovery algorithm and the placement of various content types on the homepage. The company has been making significant investments to develop its own version of the metaverse, a virtual reality world where people can interact and engage in various activities, such as gaming, socializing, attending concerts and watching sports.
Meta’s Metaverse is still losing the company billion’s, and many media outlets have proclaimed the venture all but dead.