In a surprising turn of events, Roblox Corporation's stock, RBLX, saw a significant decline in premarket trading, sinking by 21.9% to a current price of $58.94. This translates to a staggering drop of $16.53 per share, creating ripples across the investor community.
This notable decline follows the release of Roblox's fourth quarter and full year 2024 financial results, which revealed both strong revenue growth and substantial net losses. The company reported revenue of $988.2 million for Q4, marking a 32% increase compared to the previous year. However, despite these impressive figures, Roblox also reported a net loss attributable to common stockholders of $219.6 million for the quarter.
For the full year 2024, Roblox’s revenue reached $3.6 billion, a 29% increase year-over-year. Despite these numbers indicating a growth trajectory in terms of revenue and user engagement—with average Daily Active Users (DAUs) rising to 85.3 million—the reported net loss continued to raise eyebrows among investors.
The decline in stock price suggests that investors were particularly focused on the increased operational losses, which might overshadow the positive revenue growth. In Q4 2024, the company reported an adjusted EBITDA of $65.6 million but still ended with a consolidated net loss of $221.1 million.
CEO David Baszucki emphasized in his statement that despite the losses, Roblox is committed to innovation and building a strong community on its platform. He mentioned, "As we aim to support 10% of the global gaming content market, we’ll continue investing in our virtual economy, app performance, and AI-powered discovery and safety, empowering creators and enhancing the user experience.”
Investors will now be looking closely at Roblox's first-quarter guidance for 2025, as the company anticipates revenues between $990 million to $1.015 billion. Given the current market conditions and recent performance, the market sentiment regarding Roblox appears cautious, as evidenced by the sharp decline in the stock price.
