Roblox to Report Q1 Earnings: What's in the Cards?

Roblox (RBLX - Free Report) is set to report first-quarter 2022 results on May 11.

The Zacks Consensus Estimate for revenues is pegged at $641.12 million, indicating a decline of 1.71% from the year-ago quarter’s levels.

The consensus for loss has remained unchanged in the past 30 days and is currently pegged at a loss of 23 cents per share.

Let’s see how things have shaped prior to this announcement.

Roblox Corporation Price and EPS Surprise

Roblox Corporation price-eps-surprise | Roblox Corporation Quote

Factors to Consider

Roblox’s first-quarter performance is expected to have benefited from consumer onboarding, developer growth and a year-over-year rise in user engagement.

In fourth-quarter 2021, the average daily active users (DAU) reached 49.5 million, up 33% year over year.

Roblox reported 28% year-over-year growth in its DAUs, reaching 55.1 million in February 2022.

With people getting back to normal school and work life, the company expects a sequential decline in DAUs in the to-be-reported quarter.

In the fourth quarter of 2021, hours engaged were 10.8 billion, up 28% year over year. Hours engaged rose 21% year over year, reaching 3.8 million in February 2022. The to-be-reported quarter’s performance is expected to have benefited from strong engagement hours growth.

The company expects robust growth in the age demographics between 13-to-16-year-olds and 17-to-24-year-olds in first-quarter 2022. Roblox witnessed a high rate of growth in 17-to-24-year-olds in its user base, comprising almost 20.5% of all DAUs in January 2022.

Roblox’s increasing penetration in user base between 9 to 12 years and even U9 holds promise. This is expected to have aided user growth in the to-be-reported quarter.

Roblox’s developer community’s focus on providing good content featuring better visuals and effects and continued market penetration is expected to have driven first-quarter results.

Key Q1 Highlights

In the first quarter, the National Football League (NFL) teamed up with Roblox to expand its presence in the Metaverse Universe with the launch of NFL Tycoon. The NFL is the first official major sports league to offer a persistent experience on Roblox to sports fans in the Metaverse.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Roblox has an Earnings ESP of 0.00% and carries a Zacks Rank #3, currently. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.