Roblox (RBLX), which creates "immersive, interactive shared experiences," is scheduled to report results of its fourth quarter before the opening of the U.S. markets on Wednesday, February 15 and will host a conference call to answer questions regarding its results on the same date. What to watch:

USER GROWTH: Shares of Roblox closed lower on November 9, the day the company reported average daily active users grew 24% year-over-year to 58.8M in Q3.

In terms of other key metrics reported with its last quarterly report, Roblox said bookings of $701.7M were up 10% year-over-year, and up 15% year-over-year on a constant currency basis, while hours engaged were 13.4B, up 20% year-over-year. "We are creating innovative technologies to enable deeper forms of immersion, communication and expression to further enhance the value of the platform," added CEO David Baszucki.

On December 15, Roblox released certain metrics for November. Daily active users of 56.7M were up 15% in the month. November hours engaged of 3.9B were up 10%, while November bookings were reported in a range of $222M-$225M.

Following that release, Piper Sandler analyst Thomas Champion said Roblox's November metrics were generally below expectations. The company's daily active users and bookings missed Piper's estimates and the analyst was a "little surprised" as he thought Roblox could benefit from more students in the U.S. being home amid the worsening flu season. However, there might also have been "some noise" in the year-ago period after Squid Games and there was also one less day in November than October, wrote Champion, who continues to see a long-term opportunity for the company driven by daily active user growth, monetization upside and advertising as a catalyst.

On January 17, Roblox released its December metrics, including DAUs of 61.5M, up 18%. Hours engaged were 4.7B, up 21% year-over-year.

Afterward, Stifel analyst Drew Crum reiterated a Buy rating on Roblox shares. In recapping December's key performance indicators, or KPIs, Crum noted all metrics represented monthly records for Roblox, were ahead of his figures, and he believes they were ahead of market expectations.

Meanwhile, Truist analyst Matthew Thornton said he believed December bookings were above sell-side consensus and "directionally consistent" with his preview. Bookings upside was driven by both solid user growth and engagement, said Thornton, who believed the stock deserved "to trade up on these metrics" after downside in the company's October and November reports. The analyst, who also noted that Roblox disclosed that it will stop reporting monthly KPIs after its March report to be published in April, has a Hold rating on the shares.

BEARISH VIEWS: On December 21, Wolfe Research analyst Gal Munda downgraded Roblox to Underperform from Peer Perform with a $24 price target, stating that the company's "disappointing" November metrics potentially provided concern about the company's execution. The analyst believes consensus estimates for bookings growth over the near-to-medium term were high and that it is too early to model the potential contribution from Roblox's advertising opportunity as "many questions remain in terms of how the mechanics of advertisements can seamlessly work in the virtual platform."

More recently, on January 19, Morgan Stanley analyst Matthew Cost downgraded Roblox to Underweight from Equal Weight with a price target of $24. Cost believes a bookings reacceleration in the first half is priced in and expects slower growth in the second half and minimal upside from advertising in the near-term. Cost views North America trends and immersive ads as unlikely to drive further upward revisions this year, the analyst added at the time of the note's publication.

Among 34 analysts tracked by Bloomberg, 15 have Buy or equivalent ratings, 11 have Hold ratings, and eight have a Sell-equivalent rating. The average price target of 25 of those analysts who have recently updated their views is currently $34.76.

BTIG BULLISH: On January 3, BTIG analyst Clark Lampen named Roblox as his BTIG Top Pick for first half of 2023, replacing AppLovin (APP) on that list. The next day, Lampen lowered the firm's price target on Roblox to $48 from $51 while keeping a Buy rating on the shares as the analyst updated the firm's model going into the company's December metrics report.

Following the update, Lampen kept a Buy rating and $48 price target, stating that the company reported "strong" metrics for December. The outperformance was driven by the company's improving core monetization as well as a strong quarter for gift cards, the analyst told investors. Lampen adds that as comps ease over the next five months, Roblox growth should accelerate, also noting that he expects landing page optimizations to allow the company to continue driving improvements in monetization approaching the back half of the year.

CONSENSUS: In terms of overall results for the fourth quarter, analysts are calling for Roblox to report an adjusted loss of (37c) per share on total revenue of $876.2M, according to Bloomberg data. For the March-end quarter, analysts' consensus currently calls for revenue of about $697M and for the company to post an adjusted loss of (32c) per share, according to data from Bloomberg.

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