Roblox shares rose the most in nearly a year after the video game company reported third-quarter bookings that beat analysts’ expectations. and increased their full-year guidance as the platform’s user base increased.
The San Mateo, California-based company reported $1.1 billion in bookings in the three months ended September 30, a sales measure that was 34% higher than the previous year. That figure exceeded analysts’ median estimate of $1 billion and the company’s own projections.
The company also raised its full-year bookings forecast to $4.34 billion from $4.18 billion. In the fourth quarter, bookings will be $1.34 billion to $1.36 billion, the company said. Roblox shares rose 15.7% to $49.93 at 9:51 a.m. in New York, the biggest gain in nearly a year.
Online platforms like Roblox, where users can play several different games with friends, continue to capture the interest of gamers. Roblox users spend more time and money on the platform every year.Roblox reported 88.9 million daily active users during the third quarter, an increase of 27%.
Roblox attributes its growth to its search and discovery feature, which uses artificial intelligence to help users find the games they like. Roblox game developers are also publishing games that the company says are of higher quality, prompting users to spend more money on them.
In November, Roblox will implement security changes following widespread criticism of its policies and arrests of alleged child molesters who use the service. Children under 13 (about 40% of Roblox’s user base) will need parental permission to access certain chat features.
In July, a Bloomberg Businessweek investigation showed that US police have arrested more than two dozen people accused of abusing or kidnapping victims they met or manipulated on Roblox.
In early October, Roblox shares fell 9% after short seller Hindenburg Research published a reportwhich claimed that Roblox does not do enough to prevent child predators from accessing the platform. The report also accused Roblox of misleading investors with its user numbers, although analysts have cast doubt on that claim.
Roblox addressed concerns about child safety in its Thursday press release, saying the company is “deeply concerned about any incident that endangers our users” and has a team of thousands of moderators.
