The child looks at the Roblox banner, hung in honor of the company’s IPO, on the front facade of the New York Stock Exchange (NYSE) in New York, March 10, 2021.
Brendan McDermid | Reuters
Shares of Roblox rose nearly 5% on Wednesday, marking a turnaround from an initial drop of 10% on Tuesday night after the company posted disappointing earnings for the first quarter.
The company reported a loss of 27 cents per share compared to a loss of 21 cents per share expected by Wall Street, according to Refinitiv. Analysts also expected $ 645 million in revenue, but the company posted $ 631.2 million. The company’s booking fell 3% in the quarter. It also reported 54.1 million active users on average per day in the first quarter, which was below the StreetAccount consensus of 55 million.
Although it is unclear what is causing the surge, the company looked tuned for growth this quarter. The online gaming platform faced difficult comparisons to its performance earlier during the pandemic, when children were glued to their TVs and gaming platforms to entertain themselves in lock mode.
“We expected growth year on year to bottom in April. Now it looks like it has bottomed out in March, which is good, so consistently our annual growth rate in April has been better than in March, and compared to last year I expect that it will be true in May and again in June, ”Roblox CFO Michael Guthrie said during a company conference with investors on Wednesday morning, according to an approximate transcript.
“In terms of the overall shape of the curve, usually … May is lower than April and then June is again higher than May, and indeed, the opening of the summer season is where normal seasonality begins,” Guthrie added.
Subscribe to CNBC on YouTube.