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Roblox (RBLX) co-founder and CEO Dave Baszucki wants his piece of the gaming pie.
“We’ve shared that the gaming market is a $190 billion market, and we have the goal of having 10% of that run on our Roblox platform,” Baszucki said in a new episode of Yahoo Finance’s Opening Bid podcast (watch above; listen only below).
Baszucki said Roblox is starting to have success with older kids, helped by a push into sports content.
“We’re starting to see more content that’s appealing. So all of these things are really creating an ecosystem for better content, a wider range of people all around the world,” Baszucki added.
Roblox is fresh off a better-than-expected first quarter as it gained traction with new gaming genres like racing with children over age 13. Revenue, daily active users, and bookings all increased by double-digit percentages year over year.
Sales clocked in at $1.03 billion, up 29% from the prior year. Bookings — a measure of in-game currency sales — gained 31% to $1.2 billion. Average daily users improved 26% to 97.8 million. Total hours of engagement on the platform increased 30% to 21.7 billion.
For the full year, Roblox forecasts revenue of $4.3 billion to $4.365 billion, up about 19.5% year over year. Adjusted operating profits are projected between $205 million and $265 million. At the midpoint, it would equate to adjusted operating profit growth of about 28%.
The strong start to the year has pushed Roblox shares to a 52-week high. Its stock is up 165% over the past year. Among the 30 sell-side analysts that cover Roblox, 70% rate the stock a Strong Buy or Buy and 20% rate it a Hold, according to Yahoo Finance data.
Interestingly, the average analyst price target on Roblox is $77.95 — 16% below current levels.
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“Roblox is taking share of video game user time and spend, and we believe the company has a significant monetization opportunity, including two new revenue streams ramping in advertising and commerce,” JPMorgan analyst Cory Carpenter said in a note. “We expect this to support sustained 20%+ bookings growth, which combined with RBLX coming out of a heavy investment cycle should result in FCF compounding at 30%+ through 2027.”
Carpenter rates Roblox shares at Overweight, a Buy equivalent.
Three times each week, Yahoo Finance Executive Editor Brian Sozzi fields insight-filled conversations and chats with the biggest names in business and markets on Opening Bid. You can find more episodes on our video hub or watch on your preferred streaming service.
Brian Sozzi is Yahoo Finance’s Executive Editor and a member of Yahoo Finance’s editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email [email protected].
