RBLX Q3 2023 Earnings

Call Details

• Call Title: Roblox Corporation Q3 2023 Earnings Call
• Date: November 8, 2023 at 1:30 PM UTC
• Management Team:
  • David Baszucki (Chief Executive Officer)
  • Mike Guthrie (Chief Financial Officer)
  • Stefanie Notaney (Head of Investor Relations)

Call Summary

Financial Performance

• GAAP revenue for Q3 was $713M, which was up 38% year on year.
• Bookings in Q3 were $839.5M, representing year-on-year growth of 20%.
• Cash flow from operations in Q3 was $112M and free cash flow was $59M for the quarter.
• Daily active users (DAUs) reached 70M in Q3, which was up 20% year on year.
• Total hours of engagement in Q3 were 16B, which was up 20% year on year.
• Covenant-adjusted EBITDA for the quarter was $81M.
• Net liquidity was stated as over $2B and total cash equivalents and investments were $3.1B.
• The company reported record average monthly unique payers of 14.7M in the quarter.

Guidance

• The company announced it intends to begin providing formal financial guidance beginning in 2024 with the Q4 earnings call in February 2024 covering full-year 2024 and Q1 2024.
• Future guidance cadence will include quarterly forward guidance for the next quarter and updates to full-year guidance each quarter.
• Company stated it will guide on revenue, bookings, net income, and margins in the new cadence.
• CFO provided mean consensus for Q4 2023 as of November 7 of bookings $1.065B, adjusted EBITDA $173.2M, and revenue $809.3M and said the company is comfortable with consensus bookings and adjusted EBITDA.
• CFO cautioned that revenue is more complicated to forecast due to mix of consumable versus durable virtual goods and the 28-month average life of a payer affecting revenue recognition.
• Based on current assumptions and no change to payer average life, the company expects Q4 revenue to be approximately $740M to $750M, implying about 28% year-over-year growth.