Issue 3
ROBLOX (RBLX)
Roblox is an immersive social 3D creation platform and virtual universe where millions of users globally gather to play, create, and learn together. As a major player in the digital entertainment space, the company serves over 85 million daily active users.
Price at a glance:
Business Assets:
๏ Roblox's main business is to monetize experiences by allowing brands and creators to sell digital items in their in-game stores. Users can purchase these items using real-world money in exchange for Roblox's virtual currency, Robux.
๏ The majority of games produced using Roblox Studio are developed by minors. Roblox allows players to buy, sell, and create virtual items which can be used to decorate their character that serves as their avatar on the platform. Clothes can be bought by anyone, but only players with a Premium membership can sell them.
๏ After a lull once the COVID pandemic ended, Roblox's near-term performance (RBLX stock +25% YTD) has improved dramatically. Revenue growth is at the high end of the industry, cash flow is improving and net loss declining. A goal of management is Roblox's long-term aim of reaching a billion users - more than 10 times its current scale.
Company Information:
Roblox was founded in 2004 by David Baszucki and Erik Cassel
• Headquarters: San Mateo, CA
• Employees: 2,400
• 2024 Revenue: $3.6 billion (+29%)
• 2024E Earnings $(1.1 billion) (-31%)
• P/E: -32.8x