Roblox Corp. shares fell 9.1% Wednesday, after the social-gaming and creation platform revealed that growth slowed after a massive Halloween weekend outage.
shares finished at $97.95, after being down as much as 13% in late afternoon trading. Shares are still 118% above their $45 direct-listing reference price from back in March, when the company went public. By comparison, the S&P 500 index
is up 22%, and the tech-heavy Nasdaq Composite Index
is up 19%, but the Renaissance IPO ETF
is down 10% over that period.
A month ago, Roblox shares soared more than 40% in one day after the company reported strong October results despite having lost three days to an outage that occurred over Halloween weekend. Shares surged the other way Wednesday after the videogame company disclosed November numbers that were not as strong.
For November, the company reported 49.4 million average daily active users, up 35% from last November but down from the 50.5 million it had in the first 27 days of October, which was a 43% gain from October 2020.
Estimated bookings for November were between $208 million and $211 million, or a gain of 22% to 24% year over year, Roblox said. Using the first 27 days of October, Roblox said bookings were between $177 million and $179 million in 2021, or 30% to 34% above the same period a year ago.
For November, hours engaged were 3.6 billion, a gain of 32% year over year, but in the first 27 days of October, hours of engagement were 3.2 billion, or up 41% over the same period in 2020.
“This marks an acceleration from October’s metrics when including the outage, but a deceleration from the unaffected first 27 days of October in terms of growth in DAUs, bookings and hours engaged,” KeyBanc Capital markets analyst Tyler Parker wrote in a note Wednesday. Parker has a hold rating on Roblox.
“Management commented on the last earnings call that November and October are usually similar in size; thus, we believe the bogey was closer to $215M to $220M in bookings for the buy side for November,” Parker said. “Considering management has also said December is roughly 80% larger than the October/November levels, we believe this means 4Q numbers are likely to come down in the immediate term.”
Of the 14 analysts who cover Roblox, 10 have buy ratings, three have hold ratings, and one has a sell rating, with an average price target of $113.36, according to FactSet data.