Roblox forecasts wider losses overshadowing guidance for bookings; shares fall

[Roblox Developer Conference 2019]
Ian Tuttle/Getty Images Entertainment

Shares of Roblox (NYSE:RBLX [https://seekingalpha.com/symbol/RBLX#hasComeFromMpArticle=false#source=section%3Amain_content%7Cbutton%3Abody_link%7Cfirst_level_url%3Anews]) fell on Thursday after the online gaming platform forecast losses higher than analyst estimates for the fourth quarter and full year, which made investors overlook its strong outlook for bookings.

RBLX stock is down 6.4% ahead of the opening bell on the NYSE.

For 2025, net loss is expected to be $1.10B to $1.13B, higher than the _Bloomberg _consensus estimate of $1.09B. For Q4, net loss is expected to be $1.35B to $1.40B, higher than the $1.34B estimate.

Bookings, which the company defines as revenue plus the change in deferred revenue and other adjustments, for the FY are forecast in the $6.57B to $6.62B range, raised from $5.87B to $5.97B, and above the consensus estimate of $6.19B.

For the current quarter, bookings are expected in the $2B to $2.05B range, ahead of the consensus estimate of $1.86B.

In Q3, bookings surged 70% to $1.90B and topped the consensus estimate of $1.70B. Average daily active users also rose 70% to 151.5M and beat the estimates of 132.34M. Bookings per DAU on average were flat at $12.68 and were below the estimate of $13.40.

Users on Roblox engaged in 39.6B hours (est. 32.47B) of gameplay and activity during the quarter, up 91% year-over-year.

The company's free cash flow more than doubled to $443M and was ahead of the estimate of $398.9M. Total expenses surged nearly 38% to $1.66B in Q3.

For the three months ending September 30, the company's net loss increased to $255.6M, or a $0.37 loss per share, compared to a net loss of $239.3M, or a loss per share of $0.37, for the same period last year.

Revenue at the San Mateo, California-based company rose 48% to $1.4B but was below the expectations of $1.70B.

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