01—Abstract
Summary
Summary of the 10-Q filed October 31, 2024. Cited figures are marked; the original filing is the authoritative source.
Roblox Corporation reported a revenue of $918.95 milliona for the third quarter of 2024, a significant 29% increase year-over-year, driven by higher bookings and a decrease in the estimated average lifetime of a paying user, which positively impacted deferred revenue amortization.
The company continues to invest heavily in its platform, with Research and Development expenses increasing by 14% year-over-year to $365.42 millionb, reflecting growth in headcount and stock-based compensation. Despite a net loss of $240.45 million for the quarter, free cash flow remained robust, totaling $520.67 million for the first nine months of the year.
The company also saw an increase in daily active users (DAUs) and a positive trend in bookings, indicating continued user engagement and monetization growth. However, ongoing investments in infrastructure, trust & safety, and R&D, along with a slight increase in cost of revenue as a percentage of revenue, are important considerations for future profitability.
02—Key points
Key Highlights
- Revenue increased by 29% year-over-year to $918.95 million in Q3 2024.
- Bookings grew significantly, driven by an increase in daily unique paying users.
- Free cash flow for the nine months ended September 30, 2024, was $520.67 million, demonstrating strong cash generation.
- Research and Development expenses increased by 14% to $365.42 million, reflecting continued investment in platform innovation.
- Infrastructure and trust & safety expenses increased by 12% to $244.60 million, with a portion attributed to accelerated depreciation.
- The company reported a net loss of $240.45 million for the quarter, though this was an improvement compared to the prior year's net loss.
- Cash and cash equivalents and investments stood at $3.9 billion as of September 30, 2024, providing ample liquidity.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q3 FY2024, Roblox Corp lost $0.26.
- Revenue$919.0M100.0%
- Cost of revenue−$205.0M22.3%
- Gross profit$714.0M77.7%
- Operating costs−$992.9M108.0%
- Operating income−$278.9M30.4%
- Interest, other & tax$39.6M4.3%
- Net income−$239.3M26.0%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed October 31, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $918.95M$713.23M | +28.8% |
| Cost of Revenue | $205.00M$163.58M | +25.3% |
| Gross Profit | $713.96M$549.64M | +29.9% |
| R&D Expenses | $365.42M$321.61M | +13.6% |
| Operating Expenses | $1.20B$1.01B | +18.2% |
| Operating Income | -$278.93M-$300.04M | +7.0% |
| Net Income | -$239.32M-$277.16M | +13.7% |
| EPS (Basic) | $-0.37$-0.45 | +17.8% |
| EPS (Diluted) | $-0.37$-0.45 | +17.8% |
| Shares Outstanding (Basic) | 650.96M619.35M | +5.1% |
| Shares Outstanding (Diluted) | 650.96M619.35M | +5.1% |
05—Questions
Frequently Asked Questions
What was Roblox's revenue performance in the third quarter of 2024?
Roblox reported revenue of $918.95 million for the third quarter of 2024, representing a 29% increase compared to the same period in 2023. This growth was primarily attributed to higher bookings and an adjustment in the estimated average lifetime of a paying user, which affected deferred revenue amortization.
How did Roblox's expenses change in the third quarter?
Several expense categories saw increases. Research and Development expenses rose by 14% to $365.42 million due to increased headcount and stock-based compensation. Infrastructure and trust & safety expenses increased by 12% to $244.60 million, partly due to accelerated depreciation. Developer exchange fees also increased by 36% to $231.54 million, driven by growth in bookings.
What is the company's current financial position in terms of cash and liquidity?
As of September 30, 2024, Roblox held $3.9 billion in cash, cash equivalents, and investments. The company also generated strong free cash flow of $520.67 million for the nine months ended September 30, 2024, indicating a healthy liquidity position to fund operations and future investments.
What are the key non-GAAP metrics that investors should focus on?
Investors should monitor 'Bookings,' which represents sales activity before non-cash adjustments and provides a more timely indication of trends. 'Average Bookings per DAU' (ABPDAU) is also a key metric to understand monetization across the user base. 'Adjusted EBITDA' offers insight into operational profitability, while 'Free Cash Flow' highlights the company's ability to generate cash after capital expenditures.
06—Continue