A man takes photos of a Roblox banner displayed to celebrate 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 closed down 15.7% on Thursday after the gaming company released a business update for November that showed slowing growth and a fall in revenue from its daily users.
The company said estimated bookings for the month ranged from $222 million to $225 million. That’s an increase of 5% to 7% year over year. But in November 2021, Roblox said estimated bookings were up 22% to 24% year over year over the same period. Roblox said the US dollar’s strength against the euro and British pound has impacted its business.
Roblox calls its sales figures bookings. The company generates revenue from the sale of its virtual currency called Robux, which players use to dress up their avatars and buy other premium features in games.
Roblox’s average bookings per daily active user ranged from $3.92 to $3.97, down 7% to 9% year over year.
Overall, daily active users grew 15% to 56.7 million users from November 2021, but over the past year the company reported 35% growth.
Roblox’s update comes amid broader weakness in the video game industry. Last month, Take Two Interactivethe company behind games like Grand Theft Auto, lowered its outlook for the current quarter and fiscal 2023, blaming “current macroeconomic conditions.”
“Our reduced guidance reflects shifts in our pipeline, fluctuations in foreign exchange rates and a more cautious view of the current macroeconomic backdrop, particularly in the mobile space,” said Strauss Zelnick, CEO of Take-Two, in a statement dated July 11.
In October, Apple also warned of weakness in digital advertising and games when it reported fourth-quarter results. “In services in particular, we expect growth but are impacted by the macroeconomic environment, which is increasingly impacting FX, digital advertising and gaming,” Luca Maestri, Apple’s chief financial officer, said on the company’s recent conference call.
Roblox shares are down about 73% year-to-date.